Pressure piles up on Tesco

Tesco has admitted it overstated its guidance for half-year profits by £250m. The UK’s accountancy watchdog says it is “monitoring the situation closely”.

UK’s biggest grocer sees sales fall and share price slumps after profit overstatement

SUPERMARKET giant Tesco’s market share fell below 29% in Kantar Worldpanel’s latest analysis of the British grocery market after its sales plummeted by more than 4%.
The latest Kantar analysis brought further woe for the company, which is currently in crisis after it revealed a £250m shortfall in its estimated profits for the six months to August 23.
Four senior executives have been suspended and an investigation has been launched into what new chief executive Dave Lewis described as a “serious issue” with the accounts.
Tesco also confirmed it had been without a chief financial officer for five months as Alan Stewart, previously of Marks & Spencer, was brought in two months early to fill the role.
Since the error was made public, the company has lost nearly half its market value, with shares falling sharply amid warnings that bosses could face a grilling from Ps.
Pressure was continuing to mount as Scottish Grocer went to press, but even before it hit the headlines over its recent accounting errors, there seemed to be no sign of recovery for Tesco.
The latest grocery share figures from Kantar Worldpanel, for the 12 weeks ending 14 September 2014, show the supermarket’s sales down 4.5%, leaving its market share at 28.8%.
Meanwhile, discounters Aldi and Lidl have continued their run of double-digit growth, which now stretches back to February 2011, and have claimed a further share of the market from the big multiples.
And Kantar says symbols and independents are holding steady, matching the current overall growth rate of 0.3% and maintaining their market share.
Asda recorded the best results among the big four supermarkets over the period. It was the only one of the major grocers to increase its market share, now at 17.4%, and to see an uplift in its sales, which have grown 0.8% compared to last year.
Morrisons’ continued to struggle in comparison to some competitors.
Its sales were down by 1.3%, although the rate of decline has slowed considerably.