The big earning news in the City today is the third quarter interim management statement from Tesco, which has shown weaker sales growth than some analysts were expecting.
Britain's biggest supermarket chain reported that UK like-for-like sales rose by 2.8% (excluding petrol and adjusted for lower VAT) in the 13 weeks to 28 November. Analysts were forecasting around 3%.
Today's result is also lower than the 3.1% like-for-like sales growth that Tesco achieved in the second quarter of the year. Back in the first quarter of the year, when food inflation was still rising, Tesco's UK sales grew by 4.3%.
Overall, group sales were up by 8.8% (excluding petrol) compared with the previous quarter thanks to a stronger performance overseas, and chief executive Sir Terry Leahy insisted that Tesco was coping well with the economic downturn:
We are seeing improving customer confidence and encouraging trends in both the UK and our international businesses, although recessionary conditions still exist in a number of markets. As ever, with Christmas approaching, we're doing even more for customers with low prices, great promotions, including on our Finest range, and of course double Clubcard points.
But traders are predicting that Tesco's shares could some under pressure today – they fell just over 2% when the stock market opened.
Finance director Laurie McIlwee has also told Reuters that while Tesco can cope with the end of the temporary VAT reduction, it would not be happy if VAT rose to 20%.
We also have results from Game Group this morning, which continues to find 2009 much tougher than 2008. Like-for-like sales in the UK and Ireland are now down 16.6% this year.
Game had been pinning its hopes on a corking selection of new computer games in the run-up to Christmas, but chairman Peter Lewis indicated that Game may be a bit disappointed:
Since the half year, there have been a number of major software releases including Call of Duty: Modern Warfare 2 and FIFA 10, which both broke records in their first week of launch. However, the exceptionally strong performance of these titles was in part offset by softer than expected sales of some other releases.
In other news … Xstrata will take a $1.9bn hit after writing down the value of its nickel assets.
And on a brighter note, FTSE 250-listed Domino Printing has hiked its dividend by 10% after increasing its pre-tax profits by 11% to £28m.
