Tesco posts surge in first half profit
Tesco has reported a 28.7% uplift in first half pre-tax profits after it benefited from customers buying more food due to the coronavirus pandemic.
In the six months to 29 August, the supermarket’s pre-tax profits rose to £551 million while group sales increased by 6.6% to £26.7 billion. However, it also incurred Covid-19 related costs of £533 million.
Sales in the UK and Ireland climbed by 8.6% to £24.3 billion after first quarter growth was particularly strong as customers stocked up on essential grocery items during the Covid-19 lockdown and ate more meals at home.
Growth in the six month period was most marked online with the uplift reaching 90% during the retailer’s second quarter. In addition, Tesco’s online delivery capacity more than doubled to reach 1.5 million slots a week in the half year.
Meanwhile, sales in Central Europe declined by 1.5% after positive growth in the first quarter was followed by a weaker second half performance as countries came out of lockdown.
Ken Murphy, chief executive of Tesco, said: “The first half of this year has tested our business in ways we had never imagined, and our colleagues have risen brilliantly to every challenge, acting in the best interests of our customers and local communities throughout.
“Tesco is a great business with many strategic advantages. I’m excited by the range of opportunities we have to use those advantages to create further value for our customers and, in doing so, create value for all of our other stakeholders.”
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