07 Oct 2020
 New CEO takes the reigns at steadfast Tesco Posted in Retail

Following today's release of TescoH1 figures for 2020/21,

Thomas Brereton, Senior Retail Analyst atGlobalData, a leading data and analytics company, comments:

''Tesco's eagerly anticipated H1 results reveal an impressive performance amid an incredibly tough backdrop, navigating thechoppy waters of COVID-19 to deliver strong growth in its core UK & ROI market. Although total sales suffered as non-food sectors fell victim to altered consumer behaviour habits (notably UK clothing sales down 17.2% and fuel down 42.0%), a market-leading performance from food (+9.2%) shows Tesco's ongoing strategy of retreating from international markets to focus on UK & ROI food is harmonious with downtrodden customers prioritising food spend over non-essential purchases.

Theresults also welcome Ken Murphy as newCEO, a tried and tested leader with lengthy experience in UK retail from his time atWalgreen Boots Alliance. While he takesup themantle against a much more tranquil internal backdrop than Dave Lewis did in 2014, he will need to cope with numerous external challenges (including COVID-19, recession and Brexit) that will require quick adoption of newpolicies to meet rapidly shifting consumer choices.

Theexisting strategy of a dual assault on value and online fulfilment is a good one for Tesco. It has overhauled stores to shield itself from surrendering further market share to thediscounters, with its Aldi Price Match and rejuvenated ClubCard loyalty scheme front and centre in theminds of value-driven consumers. In theface of a fragile UK economy and distressingly low consumer confidence, this tactic is and will continue to bear fruit for Tesco. And its rapidly evolving online presence (having more than doubled slot capacity to 1.5m per week and launching its first Urban Fulfilment Centre) is in step with thequarter of Brits that have tried food shopping online since thepandemic began. For many such shoppers, this change will be a permanent one, and Tescois pulling as many strings as possible to keep newonline shoppers on its site.'

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GlobalData plc published this content on 07 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 07 October 2020 18:29:03 UTC