Tesco shareholders will this week be hoping the supermarket giant has maintained its positive trading performance in the first quarter of the year despite the continuing onslaught of the German discounters.
Last year was a strong one for Tesco, with a 34 per cent jump in profits, but concerns over whether the improvement can be sustained have recently seen shares in the UK’s biggest grocer slump to three-month lows.
“This week’s Q1 sales numbers are likely to be a reminder that the tough retail environment is expected to remain a drag on profit margins over the next few months,” predicts Michael Hewson, analyst at CMC Markets.
The latest industry data from Kantar showed that Tesco’s market share dropped to 27.3 per cent at the end of last month, from 27.7 per cent a year ago. “Once again this has been due to the discounters Aldi and Lidl eating into its market share,” said Hewson.
The figures will be announced on Thursday, the same day as Tesco’s annual general meeting where executive pay is likely to come under the spotlight.
Shareholder advisory specialist Pirc has advised that investors oppose the “excessive” £4.6 million pay deal for chief executive Dave Lewis.