Tesco lays out plans to revamp Europe business
TESCO said yesterday it planned to double returns from its central and eastern European business by buying more goods regionally, opening a variety of stores and selling more services.
At its annual results in April, the British supermarket group set a target to boost company-wide returns to 14.6 per cent by 2014-15 from 12.9 per cent in 2010-11, and the firm offered more details yesterday.
It aims to double returns in central and eastern Europe, where it operates in the Czech Republic, Hungary, Poland, Slovakia and Turkey, to 10 per cent over the same time frame.
The world’s third largest retailer told analysts and investors on a trip to the region that the growth will be driven in part by a revamp of its hypermarkets, which includes adding over 5,500 new lines and upgrading fresh service counters.
“Central Europe is a good indication of Tesco’s wider Group strategy,” said Credit Suisse analyst Andrew Kasoulis in a research note. “Central Europe is beginning to develop as a whole unit rather than five independent countries.”