TESCO is expected to emerge as the winner of a tough Christmas trading period for Britain’s big four supermarkets as weak consumer confidence, falling real incomes and rising real prices put pressure on the sector.
Analysts predict the grocer will on Thursday post a one per cent rise in UK like-for-like sales for the six weeks to 5 January – its first increase in three Christmases.
However, this compares with dire trading last year that prompted Tesco’s first profit warning in 20 years.
Dave McCarthy, analyst at Investec, warned the grocer still faced major structural issues.
“Store profitability is under pressure as the internet and convenience channels cannibalise large store sales, and problems in Europe and Asia remain”.
Meanwhile Sainsbury’s is forecast to report a 0.9 per cent rise in third quarter like-for-like sales on Wednesday compared with a 1.9 per cent rise the previous quarter.
The supermarket group launched a money-off petrol voucher on 27 December, which McCarthy said was “a sign of a weak Christmas”.
However, Morrisons is tipped to be the Christmas turkey of the three, with house broker Jefferies predicting it will today post a 2.8 per cent slump in like-for-like sales in the six weeks to 30 December.
Panmure Gordon analyst Philip Dorgan said chief executive Dalton Philips is likely to come under pressure as the grocer lags behind rivals in moving online and opening convenience stores.