The retailer’s share price jumped 9% after it reported an increase in UK sales.
Tesco’s like-for-like sales in the UK were up 0.6% in the first half, with like-for-like sales for the group growing by 1%. The retailer also confirmed that its pension deficit has jumped by £3.2bn to £5.9bn “due to lower bond yields”, whilst profit before tax was down 28.3% to £71m.
Sales volumes and transactions in the UK were up by 2.1% and 1.6% respectively, and international like-for-like sales were up 2.6%.
Although Tesco chief executive Dave Lewis said that prices at the retailer were down 6% on a year ago, the company’s like-for-like sales were positive. On the back of its sales performance, the retailer is now hoping to boost its operating margins.
Dave commented: “”We have made further strong progress in the first half, with positive like-for-like sales growth across all parts of the group as we re-invest in our customer offer, whilst rebuilding profitability in a sustainable way. We are also more competitive across our offer. Prices are more than 6% lower than two years ago, availability and service have never been better, and our range is more compelling. 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.”