Tesco warns about second-half slowdown
current buoyant trading might not continue through the second half
of the year.
On August 6, the British supermarket group Tesco cautioned that current buoyant trading might not continue through the second half of the year, reports the Financial Times. The group said that despite strong trading, the price inflation that had been helping the grocery sector was beginning to ebb. Having broken the £1bn ($1.4bn) profits mark for the first time last year, Tesco is forecast to report sales growth of between 13 and 14 per cent for the current year compared to last year's 12 per cent increase to £21bn. UK supermarkets have been enjoying a good run since the start of this year with the return of price inflation and increased spending by consumers. However, Sir Peter Davis, chief executive of rival J Sainsbury, recently issued a similar warning. In June 2001, Tesco reports a 14 per cent increase in Q1 sales, up 6.7 per cent on a comparable-store basis. Despite the warning, the group said it was maintaining its margins, and that its overseas operations were performing to expectations and should break even in Poland this financial year.
