Menu
Equities Retail UK

Tesco share price subdued as group posts Q1 results

Share this article!

Tesco’s share price (LON:TSCO) has been subdued in London in today’s session as Britain’s biggest grocer updated investors on its first-quarter performance, posting what it referred to as ‘outperformance in a subdued market’. The company’s results, however, pointed to slower growth in sales during he reported period, along with downbeat performance in Central Europe.

As of 09:02 BST, Tesco’s share price had given up 0.40 percent to 226.60p. The shares are underperforming the broader UK market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.21 percent higher at 7,383.09 points.

Tesco posts Q1 results

Tesco announced in a statement this morning that like-for-like sales had inched 0.2 percent to £13.98 billion in the 13 weeks ended May 25. At home, the group’s LFL sales rose 0.4 percent, while its wholesale business Booker saw a 3.1-percent rise. Central Europe, however, underperformed, with LFL sales in the region falling 4.9 percent, on account of store closures and two fewer trading days in Poland, along with cooler weather across the region.

“We have had a strong start to the year, growing ahead of the UK market on both a volume and value basis,” Tesco’s chief executive Dave Lewis commented in the statement.

Analysts weigh in

“UK sales were up a meagre 0.4%, short of the 0.8% expected and well below the 1.7-percent from the prior quarter,” said Neil Wilson, chief market analyst at Markets.com, as quoted by Proactive Investors. “Whilst no one thought the Christmas boost would carry through completely into the first quarter, these are mildly disappointing results. The threat from the discounters is not going away.”

The newswire also quoted Richard Hunter, head of markets at Interactive Investor, as commenting that the trading update was ‘unsurprisingly light’ on strategic detail ahead of next week’s Capital Markets Day, but the trading performance showed “positive trends across the board, with the exception of its Central European business”.

According to MarketBeat, Britain’s biggest grocer currently has a consensus ‘buy’ rating, while the average target of Tesco’s share price stands at 279.90p.

Add Comment

Investing is speculative. When investing your capital is at risk. This site is not intended for use in jurisdictions in which the trading or investments described are prohibited and should only be used by such persons and in such ways as are legally permitted. Your investment may not qualify for investor protection in your country or state of residence, so please conduct your own due diligence. This website is free for you to use but we may receive commission from the companies we feature on this site. Click here for more information.