Tesco poised to unveil strong sales figures as turnaround continues

UBS analysts are forecasting a 2.4 per cent increase in like-for-like sales at Tesco over the festive period and third quarter.
UBS analysts are forecasting a 2.4 per cent increase in like-for-like sales at Tesco over the festive period and third quarter.
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Tesco is expected to continue along the road to recovery by posting strong sales figures when it updates the market this week.

The supermarket giant, which has been undergoing a turnaround under chief executive Dave Lewis, is set to report its third-quarter and Christmas trading figures on Thursday.

Analysts at UBS are forecasting a 2.4 per cent increase in like-for-like sales over both the festive period and the third quarter.

Tesco is experiencing strong momentum relative to its peers and in October Lewis hailed a “significant milestone” after unveiling the first dividend payout for three years following a surge in half-year profits and sales. The group posted a 27 per cent rise in underlying earnings to £759 million for the six months to 26 August after it notched up its seventh consecutive quarter of increasing sales.

Sreedhar Mahamkali, analyst at Macquarie Capital, said: “We expect a decent Christmas update from the sector, with Tesco continuing to report the best like-for-likes in the sector.

“A key feature for a considerable period of time in Tesco’s recovery is the strong and consistent growth in grocery sales over the past several months.”

The group was further buoyed in December when its £3.7 billion takeover of wholesale group Booker was given the final all-clear by the competition watchdog.