STOCK OF THE WEEK: Tesco to announce half year results
Customers and shareholders will be eager to hear Tesco’s latest update as supermarkets battle to win over hard-pressed shoppers.
Shopping bills are still rising – 12.2 percent higher than a year ago, according to figures from Kantar – but major suppliers have been on a price-cutting spree in recent months.
The price war has helped Tesco gain market share against the onslaught of discounters Aldi and Lidl. Therefore, Wednesday’s half-year results will be analyzed to see what impact this has had.
Tesco reported an 8.2 percent increase in sales to £14.8 billion in the first quarter. But stocks have fallen since their annual high in May, so investors will be hoping for good news.
Susannah Streeter of Hargreaves Lansdown said: “Tesco’s razor-sharp focus on low prices is helping it fend off rival discounters, which should bode well for its half-year results.”
“The extension of Aldi’s price match promotion has also paid off, allowing Tesco to maintain customer loyalty, and investors will want to see this trend continue.”
“Inflation remains arguably the biggest headwind and with some commodity prices remaining stubborn, sustained relief could still prove difficult.”
Tesco boss Ken Murphy will also be questioned about the impact of shoplifting on the company and its employees, while warning the country is experiencing an “epidemic” of theft and violence in stores.