Tesco has today released its latest results covering the first half of 2016. Like for like sales in the UK are up 0.6%, and operating profits are up 38% on the back of improving customer performance. Food sales volumes have grown ahead of the market, and helped make this the first time since 2010-11 that the UK and Ireland business has delivered positive like for like sales for the half year.
Dave Lewis, CEO of Tesco, also revealed plans to rebuild operating margins to 3.5 to 4% by 2019-20. Underpinning the drive for higher margins and continued growth are six strategic drivers:
- Differentiating the brand;
- Reducing costs;
- Strong cash generation;
- Maximising margin mix;
- Maximising value of the property portfolio; and
- Innovating the customer and business offer.
Shares in Tesco rose sharply on the news with initial trading showing a 10% increase in price.
Frontier advises Tesco across its business on these and other strategic issues. Frontier also regularly works with other clients in the wider retail sector on their strategic opportunities.
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