Tesco back in growth for first time in a year as grocery sales rise

Tesco sales rose marginally in the 12 weeks to 1 February for the first time in a year, while the wider grocery market grew 1.1%, according to data from Kantar.

Tesco: back in the black for the first time in a year
Tesco: back in the black for the first time in a year

Kantar Worldpanel said the rise in sales had been driven by consumers taking advantage of lower fuel prices and the supermarket price war, which has seen the grocers slash like for like prices by 1.2% - a "record low".

Tesco's sales grew 0.3% over the period and the market grew 1.1%, though the figures were still poor "by historical standards".

"Britain’s largest retailer is bouncing back from a tough year, with Dave Lewis’s efforts to overhaul the supermarket attracting an additional 236,000 shoppers into its stores in the last 12 weeks," said Fraser McKevitt, head of retail and consumer insight at Kantar.

"All of the major grocers have continued to compete fiercely on price leading to like-for-like grocery prices falling by 1.2%.  This is another record low, saving Britain’s shoppers £327 million over the past 12 weeks."

However he added Tesco's market share had at the same time fallen 0.2 percentage points compared to last year. 

Meanwhile, Asda, Sainsbury's and Morrisons suffered falling sales compared with 2014 with Asda taking the title of the UK's second largest retailer over the period, overtaking Sainsbury's. Morrisons' sales slumped 0.4% but this was retailer's best performance since December 2013, Kantar said.

McKevitt said the results suggested discounters Aldi and Lidl would struggle to match their historic accelerated growth levels, growth having slowed on previous levels, but still up.

Meanwhile at the premium end of the market, Waitrose saw sales rise of 7.2%.

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