Tesco, the world's third largest retailer, named a new British leader as it showed signs of a revival in its home market with a rise in underlying Christmas sales.

Tesco said on Thursday it had appointed Chris Bush as managing director of the British business, which contributes about two thirds of group trading profit.

Bush is currently chief operating officer in Britain.

Group CEO Philip Clarke had taken direct control of the British business in March after Richard Brasher departed.

Tesco said sales at British stores open over a year, excluding fuel and VAT sales tax, were up 1.8 percent in the six weeks to Jan. 5, part of its fiscal fourth quarter.

That compares with analysts' forecasts in a range of up 0.5-1.5 percent and a third quarter fall of 0.6 percent.

The firm benefited from easy comparative numbers and the impact of its 1 billion pounds ($1.60 billion) investment plan.

In the same six week period of Tesco's last financial year like-for-like sales had fallen 2.3 percent, prompting the firm's first profit warning in 20 years and a strategic re-think.

Tesco said group sales rose 3.9 percent excluding petrol.

It said its full-year outlook for Britain was unchanged and it expected tough conditions for consumers in Central Europe to persist. - Reuters