Tesco Interim management statement tomorrow should be interesting reading

 

Tesco’s first Quarter Interim Management Statement 2014/15 is set to be issued tomorrow morning and expectations are low to say the least after the release of sales data from a data auditing firm today. The retailer’s shares dropped 1% today to 297p after Kantar Worldpanel data revealed worryingly low consumer sales for both Tesco and Sainsbury and the weakest grocery market in the UK since 2003.

In the 12 weeks to 25th May 2014 according to Kantar, Tesco’s sales fell 3.1% from the same period in 2013, Morrisons dropped 3.9% and Sainsbury’s dropped 0.9%. This compared with the German owned supermarkets, Aldi and Lidl, whose sales increased by 35.9% and 22.7%, respectively and Asda which had a 2.4% increase while maintaining its market share at 17.1%.

Tesco’s market share dropped to 29% from 30.5% while Morrisons share fell to 10.9% from 11.6%. Sainsbury’s by 0.9%, and its market share dipped to 16.5% from 16.7%.

Yesterday, Philip Clarke, Tesco’s chief executive, announced a reshuffle of the senior management team by introducing two new roles – chief customer officer and chief creative officer. The company has also established an executive committee below the board, which includes the two new roles. Jill Easterbrook, who heads the One Stop franchise and Dobbies garden centres, will be chief customer officer, while Matt Atkinson, the chief marketing officer, becomes chief creative officer.

Will Clarke answer his critics tomorrow? Unlikely.

Contrarian Investor UK

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