Tesco trading update shows UK retail sales up 4.3%

A Tesco trading update for the first quarter was issued today, reporting a solid start in the UK with like-for-like retail sales up 4.3%.

In addition, net new stores contributed 2.8% and Tesco Personal Finance 2.2%, taking the total growth to 9.3%.

Including petrol though, which has been hit by deflation, total UK sales grew by 5.5%.

Whilst higher than their previously reported quarter, Tesco’s growth falls behind that of Morrisons at 7.3% and Asda, owned by Wal-Mart, at 8.4%.

Sainsbury’s is also widely expected to top the Tesco’s growth, they provide their trading update later this week.

Sir Terry Leahy, Tesco chief Executive, said ‘We’ve made a solid start to the financial year, maintaining good momentum in a challenging economic climate.’

Tescos international business supported their overall performance with a 20% rise in sales over the period.

In the UK, a relaunched Clubcard scheme has seen encouraging take-up from customers.

As part of the growth in the Tesco Personal Finance division, the company has started the introduction of Banking and Insurance Centres in stores, with 6 opened so far.

Tescos comment on the outlook is ‘Operationally the business is performing in line with expectations and the outlook for the year as a whole remains unchanged.’

Many analysts are now viewing Tesco shares as a buy. Currently the shares are trading at a around 363p, up 2%.

Investors should of course make their own judgements on buying or selling shares and if in doubt seek independent financial advice.