Tesco’s sales rise with Booker’s acquisition

Tesco has increased its sales for the 10th quarter in the three-months to 26 May, meaning its acquisition of wholesaler Booker was a successful move.

Tesco reported its group sales increased by 1.8%, with UK and Ireland sales increasing 3.5%. Similarly, Booker, which Tesco bought for £3.7bn last year, had a rise of 1.4% in sales during the quarter.

Both supermarkets said they are working in the relaunch of 10,000 own-brand products as part of their efforts on improving customer offer. They have already put 2,850 back on shelves.

Tesco said the top 30 selling Booker product lines at two stores will now be available in 50 more branches.

Associate director at Fidelity Personal Investing, Emma-Lou Montgomery, said: “Forget the ‘threat’ of the Sainsbury’s/Asda merger, the strong performance from the recently-acquired Booker wholesale business suggests Tesco has its eye on far bigger fish. Namely, taking on retail behemoth Amazon.

“‘Pile ‘em high, sell ‘em cheap’ was the motto Tesco was founded on and that healthy 14.3% rise in like-for-like sales from Booker, shows the UK’s largest supermarket chain has no desire to relinquish its title any time soon.”

Dave Lewis, Tesco’s CEO, added: “Our growth plans are on track and we are pleased with the momentum in the business. We remain well-placed to serve our customers better and deliver on our medium-term financial ambitions.

“We are delighted with initial progress on Booker, and are focused on delivering the synergy benefits that our merger brings.”

Tesco has also announced its decision to close its non-food business Tesco Direct on 8 July.