After years in the retailing wilderness, Tesco Plc is getting back in touch with British shoppers.
The U.K.'s biggest supermarket chain on Friday posted its strongest sales growth in seven years, targeting customers' desire for healthier foods at affordable prices while wrestling with Brexit-fueled inflation.
"We've done a good job in difficult conditions," Chief Executive Officer Dave Lewis said on a conference call, almost three years after joining a business that was losing shoppers in the midst of an accounting scandal.
Lewis is heaping pressure on rivals by using the company's vast buying power to resist inflationary pressure. Tesco has raised prices less than competitors since Britain's vote to leave the European Union hit the pound, pushing up the cost of imported produce. It's also focused that price push on an area at the forefront of consumers' minds -- healthy living.
"Food, and fresh food in particular, is firing on all cylinders, and that's a huge shot across the bows for its competitors," John Ibbotson, an analyst at industry researcher Retail Vision, said by email.
The news was initially greeted positively by investors, driving the shares up as much as 4.5 percent. The stock later tumbled along with grocery shares across the U.S. and Europe as Amazon.com Inc. announced a major push into groceries with a $13.7 billion deal to acquire Whole Foods Market Inc.
SundayMonday Business on 06/18/2017