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Sustained Strong Performance at Tesco: Third Successful Christmas

Tesco’s like-for-like sales grew by 1.1% for the 19 weeks to 7 January 2017. With a small number of new store openings largely offsetting the impact of UK non-core business disposals, total sales (exc. VAT, exc. fuel) grew by 1.0% at constant rates. At actual exchange rates, sales grew by 5.7% including a 4.7% positive foreign exchange translation effect due to a weakening of sterling against our European and Asian currencies.

Like-for-like sales growth in the combined UK & ROI business over the 19-week period was 1.4%, representing a fourth consecutive reported period of growth. UK volumes rose by 1.1%, and transactions were up 2.1% as more customers chose to shop with Tesco.

Dave Lewis, Chief Executive: “We are very encouraged by the sustained strong progress that we are making across the Group. In the UK, we saw our eighth consecutive quarter of volume growth and delivered a third successful Christmas. Our fresh food ranges proved particularly popular, outperforming the market with great quality, innovative new products and even more affordable prices. Internationally, we have continued to focus on improving our offer for customers in challenging market conditions”.

“We are well-placed against the plans we shared in October to become more competitive for customers, simpler for colleagues, and an even better partner for our suppliers, whilst creating long-term value for our shareholders. I would like to thank all of our colleagues for everything they have done to serve our customers brilliantly over this very busy period.”

General merchandise performance, particularly online, was heavily impacted by not repeating last year’s Clubcard ‘Boost’ promotion. Without this impact, total UK like-for-like sales would have been 0.8% higher over the Christmas period. F&F clothing outperformed the market with 4% like-for-like sales growth over the Christmas period. Within this, seasonal clothing was particularly popular with sales up over 40% year-on-year.

Like-for-like sales in the Republic of Ireland grew by 0.1% over the 19-week period as the supermarket  invested in further lowering prices – particularly in the Christmas period – which drove strong volume growth and increased customer transactions.

International like-for-like sales were down (0.1)% over the 19-week period with a similar performance in both Europe and Asia, as annualised a strong performance last year.  In Europe, a sustained strong performance in the third quarter in Hungary, the Czech Republic and Slovakia helped to offset the impact of intense competitive activity in Poland.

Tesco Bank continues to provide a simple, clear product offer for Tesco customers. Sales increased by 6.7% in the 19-week period, due to strong growth in lending. credit card customers spread the cost of Christmas by giving 0% interest on all Tesco purchases made in November and December.

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