Andrea Felsted, Columnist

There's Life In Supermarkets Yet

Tesco's purchase of Booker is working out even better than hoped.

June 15, 2018 at 9:15 AM UTC

Andrea Felsted is a Bloomberg Opinion columnist covering consumer goods and the retail industry. Previously, she was a reporter for the Financial Times.

An employee takes an item from the conveyor belt at a Tesco supermarket.
Photographer: Chris Ratcliffe

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To say not all of Tesco Plc's investors were fans of its 4 billion-pound ($5 billion) takeover of wholesaler Booker Group Plc would be an understatement. Some were vociferous in their opposition. Yet the early signs are looking good, judging by the retailer's latest trading update.

Booker's like-for-like sales rose 14.3 percent, or 12.4 percent excluding tobacco, in the three months to May 26. Analysts at Barclays had forecast an increase of 8.5 percent. Tesco's own U.K. like-for-like sales rose 2.1 percent. While that marks a slowdown from the last two quarters, it still beat analyst expectations, which had factored in moderating food price inflation and poor weather.