Tesco increased group sales 8.1% to £67.6bn in its 2010/11 financial year, the retailer said today, while underlying pre-tax profit was up 12.3% to £3.8bn.
However, the supermarket’s preliminary results show that like-for-like sales in the UK were flat, and while in food and drink categories the company continued to perform ahead of the market it said that in some other product areas growth was below expectations. Electrical goods and clothing in particular were disappointing, and improving their performance is now a priority.
Overall, UK sales grew 5.5% to £44,571m – faster than the market as a whole – while UK trading profit was a 3.8% rise to £2,504m. However, the company said that it could do better and that it was taking action in key areas – “for example, to drive a faster rate of product innovation and to improve the sharpness of our communication to customers”.
The supermarket company, which is the UK’s largest, has also set out some immediate objectives for its team, which include keeping the UK strong and growing, being outstanding internationally and aiming to become a multi-channel retailer wherever it trades.
Tesco predicted that the retail environment would remain challenging in 2011, particularly in the more discretionary product categories.