Britain's largest retailer Tesco is to close 43 stores amidst a number of restructuring plans.
A significant proportion” of the closures will come from its local convenience stores and are targeted on its unprofitable outlets. It has also scrapped plans to open 49 new large supermarket stores.
The company also plans to make cuts totalling 250m, reduce overheads by 30 per cent and close its staff pension scheme. It is also selling streaming service Blinkbox and Tesco Broadband to TalkTalk and hopes to sell its data business Dunnhumby.
On top of this, it is closing its Cheshunt headquarters and relocating to nearby Welwyn Garden City.
The news comes after the reporting of better than expected financial results for the retailer. UK Christmas sales fell by just 0.3 per cent while grocery shopping for the period climbed 13 per cent. Online clothing sales jumped 50 per cent.
Like-for-like UK sales for the quarter fell 2.9 per cent – an improvement over the previous quarter's 5.4 per cent drop.
We are seeing the benefits of listening to our customers,” chief executive Dave Lewis said. The investments we are making in service, availability and selectively in price are already resulting in a better shopping experience. A broad-based improvement has built gradually through the third quarter, leading to a strong Christmas trading performance.
In difficult circumstances the team has begun the challenging task of reinvigorating our business. There is more to do but we have taken the first important steps in the right direction. We have some very difficult changes to make. I am very conscious that the consequences of these changes are significant for all stakeholders in our business but we are facing the reality of the situation.”
Tesco had a tumultuous 2014, with a profits overstatement leading to the sacking of key officials. Last month it warned that profits for the year ending February will be nearly 1bn less than previous predicted.