Tesco has announced a 4.6% decline in UK like-for-like sales excluding petrol for the six months until August 23, but sales at its convenience stores grew by 0.8%.
The grocery multiple blamed strong competition across grocery, price cuts and fewer untargeted promotions for the overall sales drop. Underlying profit before tax fell by 46.6% to £783m.
Following a Deloitte investigation, Tesco also revealed that it overstated its half year profits by £263m, as opposed to the £250m it originally estimated. Chairman Sir Richard Broadbent has announced his resignation in response to recent events.
Chief executive Dave Lewis said: “Our business is operating in challenging times. Trading conditions are tough and our underlying profitability is under pressure.
“Whilst my review of the whole business continues, three immediate priorities are clear: to recover our competitiveness in the UK, to protect and strengthen our balance sheet and to begin the long journey back to building trust and transparency into our business and brand.”
Tesco recently scrapped plans to build a superstore in Margate and delayed the opening of a 47,000sq ft store in Chatteris, Cambridgeshire, as it sharpens its focus on smaller format stores.
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