Tesco Ireland sees sales rise over Christmas

Sales were up at the supermarket chain over Christmas but the markets had expected stronger growth

Sales were up at the supermarket chain over Christmas but the markets had expected stronger growth Adrian Dennis  AFP  Getty Images

Tesco had been tipped to outperform the rest of the big four in the third quarter, but that title appears to have been taken by Morrisons, which posted like-for-like sales rises of 3.7 per cent earlier in the week.

On Thursday, M&S said same store food sales fell 0.4%.

And although some shareholders will be put at ease by a reiteration of FY guidance, it seems unlikely to reduce concerns that the M&S turnaround is failing to see the success of the aforementioned Tesco, while also raising further questions about how much pressure the United Kingdom high street can handle from the rise of online retailers.

In the Republic of Ireland sales were up 4pc during the Christmas period, while sales were up 3.3pc overall in Ireland in the three months to 31 December.

Alongside the Christmas update, Tesco reported a 2.3% rise in sales for the third quarter, just before the festive period, meaning that for the combined 19 weeks it was up by 2.1%.

Catherine Shuttleworth, chief executive at retail marketing agency Savvy, said: "We think that the M&S food shopper has in part been lured away to the discounters this Christmas with their enhanced premium ranges and outstanding wines and spirits offers".

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Tesco saw its biggest ever sales week in the United Kingdom over Christmas, with 58 million customer transactions and 770,000 online grocery deliveries in one week.

Outside of Ireland and the United Kingdom, the retail giant experienced "positive" like-for-like sales growth of 0.8pc in Central Europe in the three month period, as it improved its customer offering. While this was better than analysts' average forecast of a 1.1% decline, it was worse than a 0.1% fall in the previous quarter.

Supermarkets are battling rising costs linked to the Brexit-hit pound, falling consumer confidence and fierce competition in the sector as Lidl and Aldi continue their relentless march.

"Our (food price) inflation has been lower than our peers".

"We are very encouraged by our strong performance in Q3, building on the positive momentum in the first half of the year", commented Andrew Yaxley, CEO of Tesco Ireland.

Supermarkets Morrisons and Sainsbury's also suffered in the wake of the slump, drifting down 3.3p to 226.2p and 5.3p to 248.6p respectively.

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