M&S and Tesco report “strong” performance over festive period
UK retailers M&S and Tesco have released their 2023/24 trading statements, with both reporting “strong” growth.
M&S and Tesco both reported strong volume growth, with M&S reporting a 7% increase in Q3. Tesco said it showed particular strength in its fresh food category, which it suggested was supported by its “market-leading availability”.
Meat, poultry, produce, grocery and in-store bakery all delivered “strong growth” for M&S, while Tesco’s ‘Finest’ range reportedly saw sales up by16.7% with a record Christmas sales week.
Looking towards the future, Tesco said it had adjusted its expected retail operating profit to around £2.75 billion, and increase compared to its previous expected range of £2.6 billion to £2.7 billion.
In its trading statement, M&S said its new year and financial year expectations for economic growth remained “uncertain”, as it reported it was facing additional cost increases from higher than anticipated wage and business rates related cost inflation. However, it also said that the “strong” Christmas trading performance provided confidence that the “results for the new year will be consistent with market expectations”.
Stuart Machin, M&S chief executive, said: “In Food, we led the market on volume growth every month with a c.7% increase across the quarter, and served more customers than ever before. Core categories grew strongly and renewal stores, which cater to larger basket shops, performed particularly well, as more customers looked to us for more of their full shop.
“We enter 2024 with a spring in our step, but clear eyed on the near-term challenges. We are determined to deliver our objective of driving 1% growth in market share in both businesses and to up the pace of our transformation: keeping a relentless focus on trusted value; accelerating our store rotation and renewal plans; doubling down on our supply chain programmes to improve availability and lower costs; and resetting our data, digital and technology strategy to unlock benefits in future years.
Tesco chief executive Ken Murphy commented: “We stepped up our investment in service over the key festive period, with more colleagues on the shop floor, helping to deliver market-leading availability and making this our best Christmas yet.
“As part of our focus on value, we offered a full Christmas dinner for just £2.09 per person, helping to drive record sales in the weeks leading up to Christmas and further market share gains. We put a strong focus on quality and innovation too, with over 550 new and improved festive products. Over 18 million customers took the opportunity to treat themselves by shopping from our Finest range, which saw sales growth of nearly 17%.
“Over the period we cut nearly 2,700 prices, with a further 150 prices cut just this week, cementing our position as the UK’s cheapest full-line grocer. Our powerful combination of great value, quality, availability and service means that we head into the New Year in great shape to keep delivering for customers.”
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