Tesco to post trading update

The firm is expected to report two consecutive quarters of sales growth
The firm is expected to report two consecutive quarters of sales growth

Retail will dominate company reporting this week, with Tesco and Debenhams both providing trading updates ahead of the critical June 23 vote on Britain’s EU membership.

Tesco is expected to report two consecutive quarters of UK sales growth for the first time in over five years as the supermarket giant continues its turnaround.

City analysts forecast that like-for-like sales in the first quarter of the year will rise 0.3% in the UK, and follows on from the 0.9% uptick in the previous period.

Bruno Monteyne of Bernstein also expects chief executive Dave Lewis to say that the firm’s recovery is “on track”.

He said: “Tesco’s execution over the last 18 months has been ahead of all expectations. The expected message is ‘business as usual’, the recovery is fully on track and they are retaining the margin guidance.”

Over the past two weeks, Mr Lewis has continued his strategy of shedding non-core assets. Tesco has offloaded the Giraffe restaurant chain to Harry Ramsden owner Ranjit Boparan and also sold its Turkish operations.

Most recently, it sold Dobbies Garden Centres for £217 million to investors led by Midlothian Capital Partners and Hattington Capital.

Tesco reports its results on the day of the EU referendum vote and former Tesco boss Sir Terry Leahy has urged the British people to vote to remain, warning that food prices will rise as a result of Brexit.

He told the Press Association: “Food prices will go up if we vote for Brexit as the supply chain would be severely disrupted and we would be paying tariffs.

“Consumers are a big part of the recovery, and we should protect that recovery, not risk it.”