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Tesco`s Misses Sales Forecast
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Posted by: forwardone
LONDON, Jan 15 (Reuters) - Tesco Plc, Britain's biggest retailer, reported on Tuesday a 3.1 percent rise in underlying sales at UK stores open more than a year for the six weeks to Jan. 5, missing analysts' forecasts.
Tesco shares were expected to open at least 4 percent lower, traders said. The worse-than-expected update is the latest in a series from British retailers pointing to a slowdown in consumer spending amid rising energy costs and weaker house markets.
Finance and Strategy Director Andrew Higginson said Tesco had enjoyed a good Christmas, but called on the Bank of England to lower interest rates to help shore up the confidence of a "more cautious" British consumer.
"The Bank of England does need to move quickly," Higginson said in an interview.
Analysts had on average expected the supermarket group to report UK like-for-like sales, excluding fuel, up 4.0 percent, a Reuters survey of eight brokerages showed. Forecasts ranged from 3.5 percent to 4.5 percent.
Group sales at the world's third-largest supermarket group after Wal-Mart Stores Inc. and Carrefour rose 12.8 percent.
International sales grew 26.9 percent from the 12 countries outside Britain where Tesco operates. Sales in Central Europe showed some of the strongest growth, rising almost 30 percent.
Higginson said customers' response to Tesco's newest expansion in the United States, where it has 30 stores operating under the Fresh & Easy brand, was "very encouraging".
Reuters