Tesco shares plunge despite Christmas sales growth

Tesco shares plunge despite Christmas sales growth

"Rowe's five-year plan is no more than a profit stabilisation strategy and (we) see better value elsewhere", Investec's Kate Calvert, who has a "sell" rating on M&S, said. Online sales in the United Kingdom were up 5% over the entire 19-week period. In contrast, Marks & Spencer refused to participate in Black Friday discounting, but saw sales in general merchandise fall.

However, according to recent financial reports, more retailers emerged as winners than losers.

Tesco, which has been transformed by CEO Lewis following a 2014 accounting scandal, reported a 1.9% rise in like-for-like sales in its United Kingdom home market in the six weeks to January 6, below a forecast of 2.4-3.2%.

According to reports, Tesco took a significant hit from lost tobacco sales after the collapse of wholesaler Palmer & Harvey a year ago put an extra strain on its distribution network.

Tesco, which has a 28 percent share of the British grocery market, reported a 1.9 percent rise in like-for-like revenue in the six weeks to January 6. As a result, full year guidance remains unchanged.

However, analysts had expected a rise of between 2.4 and 3.2 percent.

Lewis said food, and particularly fresh food, were driving growth across all the company's stores and online, with the company selling over 600,000 turkeys and half a million kilos of fresh salmon. Fellow German chain Aldi also notched up a double-digit rise, helping it rake in over £10 billion in turnover previous year for the first time as festive shoppers snapped up luxury products and cut-price vegetables.




Department store John Lewis shrugged off any gloom with a 3.1% hike in sales over the six weeks to December 30, while its sister company Waitrose booked a rise of 1.5%. "With both Sainsbury's and Morrisons beating their Christmas trading forecasts, the supermarket giant needs to keep prices competitive despite inflation to keep customers loyal and coming back for more".

Next surprised with an impressive set of figures and profit upgrade thanks to bumper online sales at its Directory arm, having otherwise suffered a tough 2017.

Retail bellwether Marks & Spencer reported mixed trading after another fall in fashion sales and sluggish trading in its food halls.

As ever, the all-important Christmas trading has brought a mixed bag of fortunes for retailers.

Tesco said all its formats, covering stores and online, had performed well, resulting in record sales and volumes in the four weeks leading up to Christmas Day. Total sales in United Kingdom however improved 1.1 percent to 2,858 million pounds (3,855 million dollars), while like-for-like sales decreased 1.4 percent in the quarter.

M&S food sales were up 3.6 per cent, though like-for-like sales were down 0.4 per cent. Sales through M&S.com were up 3 per cent.

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