Strong international trading in the second quarter of this year has helped to boost half-year profits at UK supermarket giant Tesco.
Sales in Asia jumped by 12 per cent, European sales grew by nine per cent and US sales rose sharply by 45 per cent during the second quarter.
UK sales in the first quarter were almost flat, growing by just 1.1 per cent. However in the second quarter sales picked up, growing by four per cent.
For the six months ending late August, pre-tax profit rose 12 per cent, from £1.4 billion to £1.6 billion, with revenues increasing seven per cent, from £27.8 billion to £29.8 billion.
To compensate for weaker growth in its domestic market, Tesco is spending £2 billion on developing shopping malls in China. It also has plans to extend its hypermarkets and franchise convenience outlets in South Korea.
Commenting on the results, chief executive Terry Leahy said: “The global economic headwinds of the last two years are being replaced by the tailwinds of recovery in most of our markets and this is helping our international businesses to resume strong sales and profit momentum.
“Our important Asian markets in particular are emerging strongly from recession and we are now benefiting from the substantial investment we continued to commit to the region during the downturn.”
He continued: “In the UK, we have coped very well with subdued demand and modest levels of industry like-for-like growth, helped by excellent productivity, a pleasing performance from new stores and good growth from our Services businesses, particularly online and Tesco Bank.
“Economic recovery in the UK is slow and steady and I believe our investment in making the shopping trip even better for customers means that Tesco is well-placed to grow in this environment.”
In March, Leahy will step down after 14 years at Tesco. He is due to be replaced by international and IT director Philip Clarke.
