Tesco has confirmed it is to close 43 unprofitable UK stores and halt construction on almost 50 others as part of a plan to revive its fortunes.
In the wake of four profit warnings last year and the accounting scandal which saw group chief executive Dave Lewis take charge of the UK business, Tesco said it had enjoyed a good Christmas.
Like-for-like sales fell just 0.3% in the six weeks over Christmas - better than analysts predicted - however like-for-like sales in its third quarter were down 2.9%.
But Tesco's sales woes - a result of a lack of focus on its core store offering in the past and the strong challenge from discounters - are only part of the problem for Mr Lewis.
He used the trading update to confirm a number of changes in order to ensure no repeat of the £263m profit over-statement - including new guidelines for supplier negotiations - and outlined plans to streamline the business.
Its head office in Cheshunt is to close in 2016 while it confirmed the sale of Tesco Broadband and Blinkbox, the video steaming service, to TalkTalk.
Options were being explored for Dunnhumby, the unit which manages its Clubcard loyalty scheme, signalling a likely sale process which could value it at up to £2bn.
Tesco did not disclose the locations of the 43 stores to close but Mr Lewis revealed that a "significant proportion" would be Tesco Express convenience shops.
Changes to store management and working-hour flexibility structures would deliver savings of £230m annually but result in a one-off cost of £300m, Tesco said.
It also plans to close the company defined benefit pension scheme to staff but said colleagues would soon be offered turnaround-based bonuses.
Tesco confirmed too that it had poached Halfords boss Matt Davies to run the UK business but he would not be able to start work until 1 June.
The announcements were cheered by investors, with Tesco's share price - having taken a battering last year - rising more than 5% in early trading on the FTSE 100.
On the shop floor, Tesco joined the New Year price war with major rivals by cutting prices from today on hundreds of branded products.
It said the move, resulting in average savings of 25% on brands such as Hovis, Coca-Cola, Marmite and Tetley, was a response to "demands from customers for simpler, lower and more stable prices."
Commenting on the Christmas sales performance, Mr Lewis said: "We are seeing the benefits of listening to our customers.
"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.
"Our recent performance gives us confidence that when we pull together and put the customer first we can deliver the right results."
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