Tesco protects market share as pressure increases on Morrisons



The revival of Tesco (Other OTC: TSCDY - news) is gathering pace with new industry data showing that Britain’s biggest retailer has maintained its market share for the first time in 18 months.

According to Kantar Worldpanel, Tesco held its share of the UK grocery market at 30.4pc in the 12 weeks to January 20 after a 3.3pc rise in sales compared with the same period last year.

The figures confirm that Tesco has bounced back from a slump in sales in the run-up to Christmas 2011, which forced the company to issue its first profits warning in 20 years.

Edward Garner, director at Kantar Worldpanel, said: “These positive results are a sign of stabilisation for Tesco as the retailer gets back on track with its customers.”

Philip Clarke, chief executive of Tesco, committed £1bn to revamping the supermarket group following the profits warning, which included hiring more staff and modernising its stores.

However, Tesco’s revival is piling further pressure on Wm Morrison Supermarkets, which saw its market share decline from 12.5pc to 11.9pc over the period.

The Bradford-based company is suffering from its lack of presence in the fast-growing parts of the grocery industry sales from the internet and convenience stores and is losing market share to discount chains such as Aldi.

The Kantar figures show that the discounters are still growing faster in the UK than the leading four supermarkets which also includes Asda and J Sainsbury (LSE: SBRY.L - news) as cautious consumers cut spending.

In the 12 weeks to January 20, Aldi sales rose by 28.2pc and it now has 3.1pc of the UK grocery market, while Lidl sales rose 10pc, taking its share to 2.7pc.