Supermarket giant Tesco said on Thursday that sales rose at the fastest pace for three years during the Christmas and New Year trading period, triggering a turnaround in fortunes for the firm, Britain's biggest retailer.
Tesco, which has struggled in recent times both in its main market Britain and abroad, said sales at its British stores open more than 12 months rose 1.8 percent in the six weeks to January 5 compared with sales in the equivalent period one year earlier.
"Like-for-like sales grew by 1.8 percent -- our strongest rate of growth for three years. This was driven by a much stronger food performance than last year and a further improvement from the third quarter," Tesco said in a statement.The festive period covered part of Tesco's fiscal fourth quarter which is due to end next month.
Chief executive Philip Clarke added in Thursday's statement: "The group performed broadly in line with our expectations through the Christmas period, with an improved performance in the UK and maintained trends elsewhere as we continue to experience tough trading conditions -- particularly in Central Europe." Separately, Tesco announced it had appointed company veteran Chris Bush to head its British division after it had been led by Clarke over the past nine months.
During this time, the group has set about investing £1.0 billion ($1.6 billion, 1.2 billion euros) to help turn around the domestic business amid fierce price competition from rival supermarket chains.
Richard Brasher last year quit as Tesco's head of British operations following poor 2011 Christmas results and a profit warning by the supermarket last January.
The market welcomed Tesco's announcements on Thursday, sending its share price rising 2.39 percent to 357.5 pence on London's benchmark FTSE 100 index, which was flat overall in early trading.
"What a difference a year makes," said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers.
"Last January, Tesco issued a profits warning which precipitated a 20-percent fall in the share price and questions being asked about the validity of the strategy."
Hunter cautioned however that the latest sales data was set against "extremely weak comparatives and there remains much to be done."
Tesco meanwhile remains on course to withdraw from its struggling US business Fresh & Easy after Clarke last month said its presence would likely end.
Launched in 2007 by former Tesco chief executive Terry Leahy, Fresh & Easy has failed to turn a profit despite investment of about £1.0 billion.
Also last year, Tesco struck a deal to exit its Japanese business after nine years. Tesco is the world's third-largest retailer after US-based Wal-Mart and France's Carrefour.