Tesco raises full year profit guidance after price cuts boost sales
Tesco has raised its profit guidance for its full year after achieving strong first-half sales growth.
In the six months to 26 August, revenues increased by 5% to £34.1 billion while retail like-for-like sales in the UK rose by 8.7%.
Meanwhile, retail adjusted operating profit grew by 13.5% to £1.417 billion.
By the end of the half year, Tesco had cut prices on around 2,500 products to give customers an average saving of around 12%. It also applied Clubcard Prices on over 8,000 products across the store in a move that saved customers up to £390 per year.
Tesco chief executive Ken Murphy said: “We know how challenging it is for many households across the country, as they continue to grapple with ongoing cost of living pressures. We are committed to doing everything we can to drive down food bills and Tesco is now consistently the cheapest full-line grocer.
“Our investments in value, and in improving more than 1,100 own brand products from pasta to fresh fish, are helping us to offer outstanding quality at great prices, all underpinned by market-leading availability. Customers are responding well, contributing to market share gains in store and online.”
Tesco also saw strong growth in its premium Finest range in the period as as shoppers looked to save money by treating themselves at home instead of visiting restaurants,
Looking ahead, the supermarket said it will continue to prioritise investment in the customer offer by working with suppliers to reduce prices wherever possible.
It now expects to deliver between £2.6 billion and £2.7 billion in retail adjusted operating profit for the 2023/24 financial year.
Murphy added: “We are in a strong position to keep investing for customers, and will continue to lower prices wherever we can – doing everything in our power to make sure customers can have a fantastic, affordable Christmas by shopping at Tesco.”
