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Last Updated: Thursday, 25 November, 2004, 11:09 GMT
Petrol sales boost Tesco turnover
Tesco is continuing to lead the UK supermarket sector
Tesco says it is continuing to enjoy fast sales growth after a strong third quarter performance across all parts of its business.

The UK's largest supermarket group said overall sales were up 12.2% during the 14 weeks to 20 November, compared to the same period last year.

Tesco said UK sales alone were up 12.3%, compared to the second quarter rise of 11.8%, aided by petrol sales.

It said it had kept petrol prices as low as possible despite oil hikes.

Fuel driven

Tesco's like-for-like UK sales growth in the quarter was 9.8%, or 7.5% excluding petrol.

The Tesco figures are phenomenal. The market never gives it the credit it's due
David Buik, Cantor Index

"Petrol volumes continued to grow exceptionally strongly during the third quarter, helped by our efforts to keep fuel prices down during a period of rising oil prices," said Tesco.

International sales grew by 18.2% at constant exchange rates, and by 11.9% at actual currency rates.

Two months ago the Hertfordshire-based group beat market expectations with a 24% rise in half-year profits to 822m.

"The core UK business has delivered another strong performance, sales and market share in non-food have increased, our international operations have continued to make good progress and our retailing services businesses have grown fast," the company said.

During the final quarter of its financial year, Tesco said it expects to see overseas sales increase even further thanks to the opening of an additional 1.4 million square feet of trading space.

"The Tesco figures are phenomenal. The market never gives it the credit it's due," remarked David Buik of Cantor Index.

Festive drive

Tesco said it had continued to take market share in non-food business ahead of the Christmas retail season.

Tesco 28.3%
Asda 16.7%
Sainsbury's 15.5%
Morrisons & Safeway 13.2%
Somerfield 5.7%
Co-ops 5.1%
Waitrose 3.6%
Iceland 2%
Budgens 0.4%

Strong growth in clothing and DVDs helped boost sales and it reported a positive response to its new value range of kitchen products.

Digital cameras are part of its strategy to take on major electrical retailers on the High Street such as Dixons and Comet.

"There's been a huge move towards digital cameras, we're expecting to sell something like 40,000 digital cameras over Christmas," it said.

The world's third biggest supermarket chain by turnover has operations in 12 countries, including Hungary, Poland, Taiwan and Japan and plans to open more new stores abroad.

Tesco shares, which have outperformed the FTSE-100 index by 10% this year, were trading nearly 5% higher at 313.75 on Thursday morning.

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