Industry & Business

Tesco may not be out of trouble yet after a turbulent few years, but there was nevertheless positive signs as it published its latest set of financial results.

Shares at Tesco began to fall in 2011, and have kept on falling, culminating in an accounting scandal that wrote off £263 million in profits towards the end of 2014.

With their latest results for the first half of 2016, however, it seems Tesco may be clawing back some of the business lost in both the UK and Ireland.

Commenting on their Irish performance, Tesco indicates: “In a market that remains highly competitive, like-for-like sales in the Republic of Ireland grew 0.2% as customer perceptions of our proposition improved significantly year-on-year. Whilst top-line growth in value terms was held back by our continued investment in lower prices, we retain our leading position in the market in volume terms thanks to a strong performance in fresh food.”

Overall, UK & ROI operating profit before exceptional items was £389 million. Tesco indicates this first half profitability was ahead of their initial plan.

According to recent figures from Kantar World Panel, Dunnes Stores has caught up with Tesco in terms of market share in the Irish market, with the pair joint-second on 21.6%. Just ahead in first place is SuperValu, who hold a market share of 22.4%. Aldi and Lidl, meanwhile, lie around 11%.

Kantar point out: “While Tesco has seen value sales fall by 2.3% it continues to sell more items, with volume sales 1.9% higher than the same time last year. The performance gap between value and volume sales is a reflection of a lower average price point at Tesco, in part the result of its ‘Staying Down Prices’ campaign.”

Commenting on the overall results, Tesco Chief Executive Dave Lewis said: “Whilst the market is uncertain, we have made significant progress against the priorities we set out two years ago, stabilising the business and positioning us well for the future.”