Tesco turnaround gathers pace under new CEO
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* Kantar says Tesco (Xetra: 852647 - news) sales up 1.1 pct in 12 weeks to March 1
* Says Tesco resurgence hurting Asda
* Discounters' growth slowing
LONDON, March 10 (Reuters) - Britain's Tesco posted
its strongest sales performance in 18 months, industry data
showed on Tuesday, adding to evidence that new boss Dave Lewis's
turnaround plan is making an impact as a supermarket price war
intensifies.
Since joining the troubled grocer last September, Lewis has
cut prices on fresh produce and branded goods, improved product
availability and stepped up customer service, seeking to win
back shoppers who deserted Britain's biggest supermarket chain
for discounters Aldi and Lidl.
Data from market researcher Kantar Worldpanel showed that
Tesco's sales rose 1.1 percent over the 12 weeks to March 1,
suggesting that Lewis's plan may be working.
The increase helped Tesco to arrest its falling market
share, which was down only a tenth of a percentage point to 28.7
percent compared with last year.
Shares (Berlin: DI6.BE - news) in Tesco are down a quarter year on year but are up
37 percent over the past three months on recovery hopes. They
were flat on Tuesday.
Though Aldi and Lidl recorded sales increases of 19.3
percent and 13.6 percent respectively, their growth has been
slowing in recent months.
Kantar said that Tesco's resurgence has had an impact on
Asda, Britain's second-biggest supermarket chain, which competes
for many of the same shoppers as Tesco. Asda sales fell 2.1
percent, taking its market share down half a percentage point to
17 percent.
Last month Asda, the British arm of U.S. group Wal-Mart
, blamed a fall in its sales on the unprecedented use of
discount vouchers by its rivals among the so-called Big Four
grocers and warned that the practice was unsustainable.
Sales at Sainsbury's and Morrisons, the
third and fourth-biggest players, fell 0.5 percent and 0.4
percent respectively.
Last month's Kantar data had showed Tesco increasing its
sales for the first time since January 2014.
Kantar said that the overall grocery market increased sales
by 1.1 percent in the 12-week period, while deflation reached a
new low of minus 1.6 percent as price competition between the
rivals continued.
"All of the major supermarkets are cutting prices to win
shoppers, especially within everyday staples such as eggs,
vegetables and milk," said Fraser McKevitt, head of retail and
consumer insight at Kantar Worldpanel.
He noted that a combination of lower general inflation and
the grocery price war had saved shoppers 400 million pounds
($603 million) in the past 12 weeks.
Market share data (percent)
12 wks to 12 wks to Percentage
March 1, March 2, change in
2015 2014 sales
Tesco 28.7 28.8 1.1
Asda 17.0 17.5 -2.1
Sainsbury 16.8 17.0 -0.5
Morrison 11.0 11.1 -0.4
Co-op 5.9 6.1 -2.1
Waitrose 5.2 5.0 4.9
Aldi 5.0 4.3 19.3
Lidl 3.5 3.1 13.6
Iceland 2.2 2.2 -0.5
($1 = 0.6629 pounds)
(Reporting by James Davey; Editing by Neil Maidment and David
Goodman)