(Alliance News) - Tesco PLC on Friday posted a first quarter sales rise, despite catching up to tough comparatives, though the grocer did note that its fortunes moderated later in the quarter as Covid-19 restrictions in the UK eased.
In April, beer gardens were reopened in England, allowing punters to dine and drink outdoors. This eased further in mid-May, allowing for indoor hospitality.
In the 13 weeks to May 29, Tesco posted group sales of GBP13.36 billion, up 1.0% annually like-for-like and rising 8.1% from two years earlier, before the onset of the pandemic. Excluding VAT and fuel, total first quarter sales were 1.1% higher year-on-year.
In the UK, it noted a "continued strong performance with growth on top of exceptional sales last year".
UK sales were 0.5% higher annually on a like-for-like basis and 9.3% up from two years earlier. Compared to two years ago, Tesco said it benefitted from more people eating meals at home.
Its like-for-like sales hike on two years earlier peaked at 15% in March, though the grocer cautioned that growth in April and May eased as Covid-19 curbs were relaxed.
Also on Friday, the Office for National Statistics noted retail sales in the UK fell 1.4% monthly in May as people returned to pubs and restaurants.
Online demand "remains high" in the UK, Tesco noted, with the supermarket seeing orders of 1.3 million per week. Online sales in the UK were up 22% year-on-year during the first quarter.
While its core grocery unit has seen growth stifled by easing virus restrictions, its wholesale unit Booker has benefitted. Booker's catering sales rose 68% like-for-like, though retail sales fell 4.3%.
Elsewhere, like-for-like sales in Central Europe fell 1.6% in the first quarter. Tesco Bank sales fell 10%.
Tesco Chief Executive Ken Murphy said: "We delivered a strong performance in the first quarter, even as we lapped the high demand of last year due to the pandemic.
"Our profit guidance from April remains unchanged. While the market outlook remains uncertain, I'm pleased with the strong start we've made to the year and continue to be excited about the many opportunities we have to create value over the longer term."
Shares in Tesco were down 0.4% at 230.30 pence in London early Friday.
By Eric Cunha; ericcunha@alliancenews.com
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