Tesco Ireland 'very satisfied' with 8.9% increase in sales to €1.66bn

Tesco Ireland reported an 8.9 per cent growth in sales to €1.66 billion in the year to February 23rd, 2002. Like-for-like growth was 5.8 per cent, according to Tesco Ireland chief executive Mr Gordon Fryett.

The retailer invested more than €120 million during the year, opening four new stores in Killarney, Newbridge, Tralee and Finglas in Dublin, while it recently completed a major extension to its store in Navan. Mr Fryett said Tesco would invest more than €100 million in the current year, bringing to more than €500 million the company's total investment in Ireland over the past five years.

That investment programme in Ireland was funded entirely by its own earnings and profits, Mr Fryett said. But he said the level of investment for the current year could not be taken as an indication of the company's profitability last year.

Tesco Ireland does not divulge its profitability figures for competitive reasons, according to Mr Fryett. "The profit margin we achieve in Ireland is satisfactory and allows us to invest in the Irish operation," he said. "We run Tesco Ireland as an autonomous, self-governing organisation. We are a standalone business. The level of investment here is sustainable on a stand-alone basis." Mr Fryett said he was very satisfied with the 8.9 per cent growth in sales here, despite the fact that the figure was lower than that of total international sales which recorded a 37.4 per cent growth to £40 billion sterling (€65.3 billion), group sales which were up 12.7 per cent to £25.7 billion and UK sales which grew by 9.1 per cent to £21.7 billion.

Growth in other countries reflected the varying maturity of the markets, different economic circumstances and the number of new stores being built, he said. "You can't compare like with like," he said. "Growth of 8.9 per cent in a solid, mature business is good."

Tesco Ireland will carry out one major store extension and will build a new store in Ashbourne, Co Meath, this year, said Mr Fryett. Five new stores are planned for 2003 in Carlow, Clarehall and Sandyford in Dublin, and Youghal and Mitchelstown in Cork.

The company also plans to construct a major central distribution facility in north Dublin shortly which will come into operation in 2003 with the creation of 350 jobs, Mr Fryett said. A major redevelopment of the company's IT systems and retail infrastructure would also start this year, he said.

Applications by Tesco to set up petrol retailing outlets at four sites are currently before An Bord Pleanála following objections from the Society of the Irish Motor Industry, he said.

Tesco's internet shopping service was extended to Kildare, Meath, Wicklow, Waterford and Kerry during the year, in addition to Dublin, Cork, Limerick and Galway.