Tuesday, September 22, 2020

Booker says it’s “business as usual” as margins hit by plummeting tobacco sales


Booker has released its fourth quarter results, revealing a marginal rise in sales ahead of its landmark merger with Tesco.

In the 12 weeks to March 24, Booker — a wholesaler that also owns the Budgens, Londis and Premier convenience store brands reported a 0.7 per cent rise in like-for-like sales alongside a total sales rise of 0.5 per cent.

Tobacco sales drastically offset Booker’s overall performance. Non-tobacco like-for-like sales saw a more promising 4.7 per cent rise, while total non-tobacco sales rose 4.5 per cent.

The new plain packaging and display ban reportedly saw sales at Booker‘s Budgens and Londis stores plummet.

Both convenience store chains “performed well” while Booker‘s internet sales, excluding Budgens and Londis, rose by eight per cent to £233 million.

READ MORE: Tesco-Booker merger thrown in doubt after shareholders’ protest

“On 27 January we announced the planned merger with Tesco,” chief executive Charles Wilson said.

“We are excited about the benefits the enlarged group will bring to consumers, our customers, suppliers, colleagues and shareholders.

“The merger is going through the competition process. Meanwhile it is business as usual as we continue to improve choice, prices and service for our retail, catering and small business customers.”

Both Booker and Tesco have come under scrutiny from the competition authority which will investigate the potential effects of such a large-scale merger on the UK market.

The merger has also been jeapardised by a shareholder revolt, as two Tesco shareholders with a combined nine per cent stake publicly criticised the deal earlier this week.

On the same day, Tesco faced a landmark £129 million fine over the accounting scandal three years ago.

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