Tesco reveals disappointing sales growth as Sainsbury’s hits targets
Tesco shares suffered their biggest drop in four years after the retailer announced disappointing growth in first-quarter sales.
Analysts had predicted sales growth of 5.2%, but the supermarket group, which accounts for about a third of the
The retailer said food sales had been strong for the first 13 weeks of 2007, but said non-food sales had been subdued.
Shares in Tesco fell by 4.9% following the announcement on Tuesday, the biggest fall since April 2003.
Sainsbury’s just reached its growth target of 5-6% as it said sales, excluding fuel, for its first quarter were up 5.1%.
However, shares in the supermarket increased by 0.6% on Wednesday following the announcement.
Despite the sales increase, chief executive Justin King remained cautious, describing the market as “competitive” as consumers continued to tighten their belts.