Jack's to come under the spotlight in Tesco results
Tesco boss Dave Lewis will be quizzed on the performance of the supermarket's new discount store format Jack's this week as the group unveils its half-year results.
Jack’s, launched just weeks ago, aims to take on German discounters Aldi and Lidl, which have eaten into the market share of Britain’s so-called “big four” supermarkets.
Tesco plans to open up to 15 Jack’s branches over the next year, and the City will be keen to hear how the first two stores in Chatteris, Cambridgeshire, and Immingham, north-east Lincolnshire, have been trading.
“There has much speculation regarding the group’s plans for its new discount outlet, Jack’s, and how many stores it will close or convert,” said Graham Spooner, investment research analyst at The Share Centre.
Mr Lewis said when Jack’s launched that prices will be “the cheapest in town” at each location.
He added that the move, which has been under discussion at the supermarket for more than two years, is in response to consumer desire for a “smaller, simpler range at shops”.
City analysts also expect the grocery giant to report its 11th consecutive quarter of like-for-like sales growth.
For the first half as a whole, Tesco will report UK and Ireland like-for-like sales growth of 3.3%, according to consensus estimates.
David McCarthy, analyst at HSBC, said warm weather over the summer, which helped supermarkets, will boost the results.