REG - Tesco PLC - Q1 Trading Statement 2025/26

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RNS Number : 4837M  Tesco PLC  12 June 2025

 

 

Q1 Trading Statement 2025/26

 

INCREASED CUSTOMER SATISFACTION CONTRIBUTING TO CONTINUED MARKET SHARE GAINS.

Sales performance (exc. VAT, exc. fuel) for the 13 weeks ended 24 May 2025:

                 Sales (£m)   LFL sales change
 UK & ROI        15,386       4.7%
     UK          12,305       5.1%
     ROI         772          5.5%
     Booker      2,309        2.0%
 Central Europe  997          4.1%
 Group           16,383       4.6%

Ken Murphy, Chief Executive:

"We are pleased with our performance across the first quarter. Our continued
commitment to delivering great value, quality and service for our customers
has contributed to like-for-like sales growth across all parts of the Group.

In the UK we have continued to see market share gains and increased customer
satisfaction across a wide range of measures, a reflection of our powerful
value proposition, strong availability and focus on product quality and
innovation. We introduced over 350 new own-brand products across the quarter,
including the launch of our exciting summer food range, and Finest is going
from strength to strength, with sales up 18% year-on-year.

The market remains intensely competitive, and we are committed to ensuring
customers get the best value in the market by shopping at Tesco. I would like
to thank every one of our colleagues for the contribution they are continuing
to make to deliver the best possible shopping trip for our customers."

Performance highlights(1).

UK: Continued market share momentum and further improvement in customer
satisfaction

 •    UK market share +44bps YoY to 28.0%(2) with 24 consecutive four-week periods
      of share gains
 •    Overall UK brand perception +65bps YoY(3); with further improvements in
      quality and value perception
 •    Maintained our strong price positioning relative to the market; Aldi Price
      Match on >600 lines, Low Everyday Prices on around 1,000 lines and around
      9,000 Clubcard Prices deals each week
 •    Food sales up +5.9%, with a strong contribution from fresh food; non-food
      sales (excluding toys) up +6.2%(4), with strong growth in home and clothing,
      benefiting from new and extended ranges as well as warmer weather
 •    Launched over 350 new products, including our new Finest Regional Italian
      range and enhancements to our Fire Pit barbecue range; awarded 40 Gold and
      Silver medals at the International Wine Competition
 •    Growth across all channels, led by Online, where sales were up +11.5% and
      market share up +163bps(5) as we increased capacity and saw improving customer
      satisfaction
 •    Online launch of F&F in May, helping more customers access our range of
      stylish and affordable clothing
 •    Awarded first place in the Advantage supplier survey for the 10(th) year in a
      row

ROI: Market share growth and higher volumes, driven by food

 •    Continued growth in ROI market share, up +22bps to 23.3%(6), delivering 40
      consecutive four-week periods of share gains
 •    Food sales up +5.8%, with volume growth supported by continued investment in
      our fresh proposition; Irish fresh food range received 10 Monde Selection
      awards
 •    Growth across all channels, led by Online with sales up +19.8% which continues
      to benefit from the launch of same-day Click & Collect and home delivery
      last year

Booker: Strength in core catering and retail offsets tobacco market decline

 •    Core catering growth of +7.3%, supported by warmer weather and a strong Easter
 •    Core retail growth of +5.4%, driven by strong symbol brands performance
 •    Total Booker LFL growth of +2.0% impacted by the continued decline in tobacco
      and Best Food Logistics

Central Europe: LFL growth across all markets driven by strong food
performance

 •    LFL growth across all regions, driven by a strong performance in food +4.4%
 •    Fresh food sales up +7.3%, with strong contributions from produce, dairy and
      bakery categories; packaged sales up +1.6%
 •    Targeted price investments in the context of increased competitive pressure
      and new regulation in Hungary which introduces a margin cap on certain food
      products

Guidance (unchanged versus Preliminary Results published on 10 April 2025).

We continue to expect Group adjusted operating profit of between £2.7bn and
£3.0bn for FY 25/26 (FY 24/25: £3,128m), and free cash flow within our
medium-term guidance range of £1.4bn to £1.8bn.

Since the commencement of our £1.45bn share buyback programme on 10 April
2025 and up until market close on 11 June 2025, we have bought back £448m
worth of our ordinary shares. The balance will be completed by April 2026.

Contacts.

 Investor Relations:  Chris Griffith       +44 (0) 1707 940 900
                      Andrew Gwynn         +44 (0) 1707 942 409

 Media:               Christine Heffernan  +44 (0) 330 678 0639
                      Teneo                +44 (0) 207 420 3143

A call for investors and analysts will be held today at 09:00am. A link will
be available on our website at www.tescoplc.com/investors
(http://www.tescoplc.com/investors) . A transcript and playback facility will
also be made available after the call.

We will report our Interim Results on Thursday 2 October 2025.

 

 Additional Q1 sales detail.

 13 weeks to 24 May 2025  Sales               Sales change          Sales change
 (exc. VAT, exc. fuel)    £m                  (constant rates)      (actual rates)
 UK & ROI                 15,386              5.5%                  5.4%
      UK                  12,305              5.7%                  5.7%
      ROI                 772                 7.2%                  5.7%
      Booker              2,309               3.5%                  3.5%
 Central Europe(7)        997                 5.8%                  3.5%
 Group                    16,383              5.5%                  5.3%

 UK fuel sales.

                          Sales               LFL sales change
                          £m
 UK exc. fuel             12,305              5.1%
 Fuel                     1,470               (10.6)%
 UK revenue               13,775              3.1%

 Booker sales performance.

                          Sales               LFL sales change
                          £m
 Core retail              844                 5.4%
 Core catering*           703                 7.3%
 Tobacco                  404                 (9.0)%
 Best Food Logistics      358                 (0.8)%
 Total Booker             2,309               2.0%

 * Includes sales to small businesses and sales from Venus Wine and Spirit
 Merchants PLC, which was acquired in June 2024. Venus is excluded from LFL
 growth.

 

Notes.

 1.  Sales growth percentages refer to like-for-like change unless otherwise
     stated.
 2.  UK market share based on Kantar Grocers' Share of Total Till Roll for the 12
     weeks ended 18 May 2025.
 3.  Brand Perception based on YoY changes in YouGov BrandIndex scores for 12 weeks
     ended 25 May 2025.
 4.  Our partnership with The Entertainer means we no longer recognise the full
     value of toy sales and instead earn commission income. UK non-food
     like-for-like sales including toys was +2.4%. The impact on our reported Q1
     like-for-like sales for the UK, ROI and the Group is (0.2)ppts, (0.4)ppts and
     (0.2)ppts respectively.
 5.  UK online market share based on Kantar Total Grocery Online Market for 12
     weeks ended 18 May 2025.
 6.  ROI market share based on Kantar Total Till Roll for the 12 weeks ended 18 May
     2025.
 7.  Certain rental income for malls owned in Central Europe has been reclassified
     to revenue from the start of this financial year, with no impact on prior
     period comparatives due to immateriality. The impact on total sales growth (at
     constant rates) is +1.3ppts in Central Europe. The reclassification does not
     affect like-for-like sales growth.

 

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