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British supermarket chain Tesco has finally managed to present positive results for its home territory. At 0.9 %, it was its first turnover growth in the United Kingdom in seven years.
New private labels
Total turnover for its fiscal year 2016 – 2017, excluding gasoline sales, went up 4.3 % to 49.9 billion pounds (59 billion euro). However, it would only have been a 1.1 % growth if exchange rates had remained stable. Operational profit grew an astonishing 29.9 % to 1.28 billion pounds (1.5 billion euro).
Tesco believes the introduction of seven new private labels helped generate this additional turnover, despite a 300 million pound (350 million euro) investment. Currently, 64 % of all shopping carts have one of these seven brands included already. The company also managed a like-for-like growth in nearly every market, aside from Ireland (- 0.1 %). The United Kingdom and the rest of Europe achieved a 0.9 % like-for-like turnover growth and Asia doubled that, with a 1.8 % like-for-like turnover growth.
“Ahead of where we expected to be”
Over the mid-term, Tesco also wants to lower its costs by 1.5 billion pounds (1.75 billion euro) and its 226 million pound cost-cutting measures over the past fiscal year helped it along very nicely.
“We are ahead of where we expected to be at this stage, having made good progress on all six of the strategic drivers we shared in October. We are confident that we can build on this strong performance in the year ahead, making further progress towards our medium-term ambitions”, CEO Dave Lewis said.
