A trading update for the first quarter of Tesco's financial year is expected to reveal that the recovery plan has yet to gain momentum, and the group is still losing market share amid the price war and a buoyant performance from discounters Iceland, Aldi and Lidl.
Andrew Kasoulis, an analyst at Credit Suisse, expects like-for-like sales excluding fuel and VAT to decline 1.5 per cent in the 13 weeks to May 26, in only a slight improvement on the 1.6 per cent fall in the previous quarter.
The sales performance comes at a time when food price inflation has been more than 4 per cent, indicating that underlying sales volumes at Tesco are significantly down. Tesco has been trying to turn around its performance through a raft of special offers, including money-off vouchers.
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