Tesco profits fall after “incredibly tough year for customers”
Tesco has posted a fall in full year profit after being hit by “unprecedented levels of inflation”.
In the year to 25 February 2023, adjusted retail operating profit declined by 6.1% to £2.49 billion despite a strong sales performance.
On a statutory basis, pre-tax profit was down 50.8% at £1 billion.
Meanwhile group sales in the period climbed by 5.3% to £57.6 billion as like-for-like sales in the UK and Ireland both rose by 3.3%. Like-for-like sales growth in central Europe was particularly strong at 10.4%.
Ken Murphy, Tesco chief executive, said: “”It’s been an incredibly tough year for many of our customers, and we have been determined to do everything we can to help. Our results reflect our continued investment in delivering great value and quality for our customers, whilst at the same time looking after our colleagues. This is despite unprecedented levels of inflation in the prices we have paid our suppliers for their products, and the cost of running our own operations.”
During the year, the retailer opened 91 new stores and has recently acquired the Paperchase brand.
The supermarket said it is confident it has the the right strategy to “keep winning” and will continue to prioritise investment in its customer offer whilst working to offset the impact of ongoing elevated cost inflation.
Looking ahead, it expects to deliver a broadly flat level of retail adjusted operating profit in the current financial year.
Murphy added: “Our focus on customer satisfaction, market share and free cash flow is working. It is delivering strong results and enabling us to re-invest in the business, maintain a strong balance sheet and return cash to shareholders.
“I am really confident that by investing to give customers the best possible value and continuing to look after our colleagues, we will create further significant value for every stakeholder in Tesco.”
