The move by chief executive Philip Clarke, which means Fresh & Easy will end the year with 200 stores rather than the 230 initially planned, is intended to allow Tesco to focus on making the existing stores profitable and restricting further investment into the US.
“We are clear that Fresh & Easy needs to demonstrate it can be a positive return for shareholders,” Mr Clarke said. “This is a clear message to the market. I hope they like what we have chosen to do.”
Fresh & Easy was launched by Tesco in 2007. Mr Clarke wants the business to make a profit by 2014, but losses in the last six months remained £74m despite the number of profitable stores increasing from 30 to 55.
Mr Clarke announced the slowdown in store openings as Tesco, Britain’s biggest retailer, reported its first fall in profits since 1994 due to a drop in sales in the UK, the cost of a £1bn turnaround plan to halt that decline, and pressure on its international businesses.
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