This year marks the store’s worst performance in the history of its nearly 100 year existence. The pre-tax loss of £6.38bn compares to a pre-tax profit of £2.26bn in the previous year. The loss is the biggest that has ever been made by a UK company and the biggest ever experienced by a British retailer.
The Chief executive of Tesco, Dave Lewis, has pinpointed the loss on deterioration in the market and erosion in the competitiveness of Tesco in the recent years. ‘We have faced into this reality, sought to draw a line under the past and begun to rebuild, and already we are beginning to see early encouraging signs from what we’ve done so far’ said Lewis.
Mr Lewis announced that despite a huge loss, Tesco was seeing some improvements in trading. The volume of goods which are sold across the UK has seen an increase for the first time in four years. The increase in trading has been spurred on by price cuts, an increase of staff in stores and a better availability of products.
Despite this turbulent year, Mr Lewis assured that he is prepared to invest more money in order to improve performance if such was necessary. The plans to turn around the struggling retailer include some cost-cutting measures and restructuring. These have received some general support from the market as Tesco shares rose up 24 per cent since the start of the year after hitting an 11 year low in December.
Meanwhile, CityAM reported that the supermarket remains highly competitive with macro-economic deflationary pressure and significant price investment across the industry.