Tesco fell victim to the consumer slump with its worst UK sales in 20 years while rival Sainsbury’s reported only modest growth.
Tesco said UK second-half profits will be flat following its recent £500m investment in price cuts in a bid to boost market share, which fell from 30.8% to 30.4% in recent weeks.
It said that UK sales excluding new store space, VAT and petrol fell 0.9% in the three months to August 27. The group reported a 12% in underlying profits to £1.9bn in the half-year, boosted by a strong performance in Asia.
Sales rose 9% to £35.5bn.
Sainsbury’s said same-store sales including VAT increased by 1.9% in the 16 weeks to October 1, the same increase as the previous quarter.
Sainsbury’s, which recently changed its slogan to ‘Live Well For Less’, described its performance as “good” in a tough consumer environment.