Tesco has blamed the impact of Covid-19 which was “particularly strong” on its Ireland operations as the reason for a dip in its Irish sales during the first six months of this year.
Tesco’s like-for-like sales fell by 0.1% in Ireland during the first half of this year – this included a decline of 2.4% in the first quarter as it traded over lockdown.
Commenting on its Irish operations the supermarket group said the impact of Covid-19 on its base had been particularly strong in Ireland because restrictions were “in place for a longer period than in other markets”.
Tesco also stated that in the second quarter, the effects of the “Covid-19 unwind” on volumes year-on-year eased, and sales grew by +2.4%. This also reflected a gradual increase in inflation in the market.
Tesco published its latest half year financial results for the UK and Ireland on Wednesday (October, 5) which showed that its total retail operating profit fell by 10%to £1.248 million.
It has warned of “significant uncertainties in the external environment” which could dampen its full year profit guidance for 2022 “towards the lower end” of between £2.4 billion and £2.5 billion.
The latest financial results show that Tesco’s total first half year group sales for 2022 in the UK and Ireland jumped by 3.1% to £28.178 billion.
Tesco, which celebrates its 25th anniversary in Ireland this year, employs 13,000 people and has 155 stores nationwide.
The supermarket group said during the first half of the year it had continued to expand its online business in Ireland and its click and collect service which had resulted in sales growth of +5.9%.
In June Tesco completed the acquisition of 10 Joyce’s stores in County Galway. It is required to sell off the Joyce’s Oranmore supermarket under direction from the Competition and Consumer Protection Commission (CCPC).
According to a report compiled for Tesco Ireland by economic consultants, Indecon, Tesco buys an estimated €1.6 billion a year from more than 500 Irish food and drink suppliers.
The Indecon report also suggested that in the region of 13,000 farm families nationwide supply fresh produce every day to Tesco Ireland.
Indecon said the majority of these – 83% or 10,850 farm families – supply beef and other meats while 11 per cent, or 1,400 farm families, supply dairy products and 6 per cent or 750 farm families supply other products including fruit and vegetables.