Tesco share price: Grocer set to trim garden centres unit
Tesco (LON:TSCO) is preparing to offload its garden centres unit, Sky News has revealed. In other news, the UK’s biggest supermarket has said that it will accept shoppers’ brand match coupons issued by blue-chip rival J Sainsbury (LON:SBRY).
Tesco’s share price has jumped in today’s session, having added 1.89 percent to 194.15p as of 14:54 BST, and outperforming the FTSE 100 which currently stands 0.13 percent higher at 6,212.41 points. The supermarket’s shares have gained just under 30 percent in the year-to-date, as compared with about a 0.6-percent fall in the benchmark index.
Sky News reported today that Tesco’s chief executive Dave Lewis had approved the appointment of Greenhill, a long-standing investment banking adviser to the grocer, to work on the sale of Dobbies. The business, which has 35 garden centres across the UK, recorded a £48 million loss in its 2014-15 financial year after writing down the value of its real estate. The move is part of Lewis’ strategy to dispose of businesses and brands which either dilute the supermarket’s margins or act as a distraction from its principal revival mission.
In a separate development, Tesco said in a statement today that customers will be able to use Sainsbury’s Brand Match coupons to get money off their shopping at the UK’s biggest supermarket until June. The announcement comes after Sainsbury’s said last week that it was ditching its Brand Match promotion later this month as it prepares to cut more prices on everyday products.
“This is a little help for Sainsbury’s customers from us at Tesco,” the group’s CEO for the UK and Ireland Matt Davies said in the statement. “It also provides the opportunity for Sainsbury’s customers to experience Tesco’s Brand Guarantee, which we launched in October, and has been universally welcomed by our customers.”
The move comes as Tesco prepares to update investors on its full-year performance this Wednesday, with analysts expecting the results to point to a momentum in the grocer’s recovery. The Telegraph reported yesterday that the UK’s biggest supermarket is expected to post pre-tax profits of £447 million for the year to the end of February, compared to the massive £6.4-billion loss a year earlier, the biggest in UK corporate history.
As of 10:06 BST, Monday, 11 April, Tesco PLC share price is 193.28p.