Chief executive Dave Lewis called it strong progress. To the lay reader Tesco PLC’s (LON:TSCO) interims revealed some marginal improvements.
However, in the ultra-competitive world of food retail, small changes can have a significant impact on the bottom line.
The most eagerly sought after figures were for sales. And here there seemed to be a marked improvement.
UK like-for-like revenues grew by 0.6% in the six months to August 27, suggesting the fightback against discounters Aldi and Lidl had become more aggressive. That is the third straight quarter of growth.
Volumes were up 2.1% and transactions were ahead 1.6%, which means Tesco cut prices to kick-start growth. In fact Tesco said prices had fallen 6% over the last two years.
Group underlying sales grew by 1%.
The improvements leave the grocer “well placed” to achieve £1.2bn of operating profit for the full-year. In the six months the figure was £596mln on turnover of £24.4bn.
CEO Lewis and the team wants to rebuild operating margins to 3.5-4% by 2019/20 by implementing £1.5bn of further cost cuts.
"We have made further strong progress in the first half, with positive like-for-like sales growth across all parts of the group as we re-invest in our customer offer whilst rebuilding profitability in a sustainable way,” the Tesco boss added.