• First-quarter UK like-for-likes rise 0.3% as recovery continues
  • Harris + Hoole to be sold to Caffè Nero
  • Group like-for-likes up 0.9%
  • International like-for-likes rise 3%

Tesco has reported a second consecutive rise in quarterly UK like-for-likes and struck a deal to sell its coffee chain Harris + Hoole to rival Caffè Nero.

The grocer said today that UK like-for-likes in the three months to the end of May rose 0.3%. It comes off the back of a 0.9% increase the previous quarter.

Sales volumes in the UK increased 2.2% in the latest quarter and transactions rose 1.7%.

“We are rebuilding profitability in a sustainable way”

Dave Lewis, Tesco

Group like-for-likes rose 0.9%. 

Chief executive Dave Lewis, who is driving a turnaround of the business, said grocery remained a “challenging market with sustained deflation”.

But he added: “We are putting customers at the centre of everything we do and re-configuring our business to serve them a little better every day.” 

Lewis has been disposing of Tesco’s non-core assets, having this month sold garden centre business Dobbies, restaurant chain Giraffe and its Turkish unit. 

Harris + Hoole has now been added to the chopping block, Tesco revealed today, as it has agreed a sale of the chain to Caffè Nero for an undisclosed sum.

The grocer only took full control of Harris + Hoole in February this year, having acquired a minority stake three years ago under previous boss Phil Clarke.

Meanwhile, Tesco said its new “exclusive” fresh food brands were performing “very well” with a “strong initial customer response”.

International like-for-likes rose 3%. Volumes increased 2.7% and transactions climbed 1.5%.

Lewis added: “We are encouraged by the progress we are making. 

“By growing volumes, transforming the way we work together with our suppliers, and further optimising our store operating model we are rebuilding profitability in a sustainable way. I am confident that the improvements we are making for customers are working and will create long-term value for our shareholders.”

In April, Tesco swung back into the black as annual pre-tax profits hit £162m.

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