Britain’s biggest retailer Tesco posted the worst annual loss in its 96-year history on Wednesday after writing down the value of its stores by £4.7 billion.
Also hurt by an accounting scandal and sliding sales due to pressure from discounters and a brutal price war the supermarket made a statutory pre-tax loss of £6.38 billion (€8.9bn) in the year to February 28th.
The grocer, which was recently overtaken by Supervalu as the largest supermarket in Ireland, announced a 6.3 per cent fall in sales here over this period, with full-year sales falling to €2.6bn.
The decline was strongest in the second quarter of its financial year, when sales fell by 7.3 per cent. On a like-for-like basis, Irish sales fell by 6.4 per cent, but new store sales rose by 1.4 per cent.
Tesco closed 2 stores in Ireland during the year, and opened five, bringing its total up to 149 as of year-end.
“We have seen strong competition from discount retailers and this held back our sales performance, particularly in Ireland which saw a like-for-like sales decline of (6.3) per cent,” Tesco said, noting that the fall of the euro against sterling was a factor in European markets.
Tesco’s trading profit was £1.4 billion, in line with company guidance but less than half of the £3.3 billion made the year before and a third straight year of decline.
The firm also revealed it had net debt of £8.5 billion pounds and a net pension deficit of £3.9 billion.
The results highlight the work needed to mend Tesco’s finances under new boss Dave Lewis.
Source: Irish Times.ie