LONDON, April 10 ― Tesco, Britain's biggest retailer, forecast a further increase in profit in its new financial year as strong demand and new customers helped it to post an 11 per cent jump in 2023/24.
The supermarket group, which has a 27.3 per cent share of Britain's grocery market, up 40 basis points on the year, also said inflationary pressures had “lessened substantially” and it was seeing signs of improving consumer sentiment.
“Customers are choosing to shop more at Tesco, which is reflected in growing market share as they respond to the improvements we've made to the value and quality of our products,” said CEO Ken Murphy, noting it now had “strong momentum”.
Tesco today forecast retail adjusted operating profit, its key profit measure, of “at least” £2.8 billion (RM16.9 billion) for its 2024/25 year.
It made £2.76 billion in the year to February 24 2024, slightly ahead of guidance of £2.75 billion and up from £2.49 billion made in the previous year.
Group sales, excluding VAT sales tax and fuel, rose 7.4 per cent to £61.5 billion, with UK like-for-like sales up 7.7 per cent.
The group, whose shares are up 9 per cent over the last year, is benefiting from a strategy of matching the prices of discounter Aldi on key items, and the popularity of its Clubcard loyalty scheme, which provides lower prices for members.
These programmes have been being financed by taking over £1 billion of costs out of the business in the two years to February 2024.
Tesco has also benefited from consumers looking to save money by cooking and entertaining at home rather than dining out, with sales of its “Finest” premium range up 15.7 per cent in the year.
The group also said it would buy back a further 1 billion pounds worth of shares over the next year, having already purchased £1.8 billion since October 2021. ― Reuters
