Tesco has seen a decline in its underlying third quarter sales in the UK, with the supermarket chain blaming a weaker market for groceries.
Like-for-like UK sales - a statistic that does not include new shop openings - excluding VAT and petrol were down 1.5 per cent.
The announcement comes 18 months after boss Philip Clarke launched a £1 billion turnaround plan for the company.
Tesco's overseas businesses also saw a drop in sales, especially in Asia, and Ireland. Clarke said: “Continuing pressures on UK household finances have made the grocery market more challenging for everyone since the summer and our third quarter performance reflects this. The actions we have taken to position the business for the future – including the work currently underway to transform our general merchandise offer and our decision to significantly reduce the amount of new space we open – are also holding back our sales performance in the short-term.
"Customers are continuing to respond positively to the changes we are making to the UK business to differentiate our offer and position Tesco as a multichannel leader. These include the re-launch of finest, over 100 more store refreshes in the quarter and further investment into our fast-growing online grocery service."
Outside the UK, Tesco saw its sales decline by 5.1 per cent in Asia - something the retailer claims was driven by a worsening performance in Thailand and South Korea.
In Europe, like-for-like sales were down 4 per cent, while Tesco said sales in Ireland had been hit by "extremely challenging conditions for consumers".
This latest announcement comes on the back of the UK's largest grocery chain reporting a 23.5 per cent drop in profits in the first half of its financial year in October.