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Tesco has upped its full-year guidance after a period of “strong momentum” and rising profits in its half-year results, with the supermarket’s boss noting the business is “in good shape”. Over the period, retail operating profits rose by 10% to £1.56bn, while statutory operating profits were up by 13% to £1.6bn.
Meanwhile, like-for-like retail sales grew by 2.9%, while group sales were up by 4% to £31.5bn.
It comes as the supermarket lowered prices on “thousands” of lines, with an Aldi Price Match on over 700 lines, and over 8,000 Clubcard Prices deals each week, meaning it is still the cheapest full-line grocer in the UK.
Over the period Tesco also invested additional hours in stores, the equivalent of more than 2,000 extra employee roles year-on-year.
The group said these “significant” investments it is making in value, quality and service across the group ultimately delivered volume growth ahead of expectations in the first half.
In light of this, it now expects to deliver around £2.9bn in retail adjusted operating profits for the 2024/25 financial year, up from its previous guidance of “at least” £2.8bn.
CEO Ken Murphy said: “We’ve been working really hard to offer our customers the best possible value, quality, and service and they are shopping more at Tesco as a result. We have lowered prices on thousands of lines, launched or improved over 860 products in partnership with our suppliers and growers, and our customer satisfaction scores continue to improve across a broad range of measures.
“The combination of price, quality and innovation means we are as competitive as we have ever been, and we have been the cheapest full-line grocer for nearly two years. Our strong UK and ROI market share gains across the last year demonstrate our continued momentum.”
He added: “I want to say a big thank you to all my Tesco colleagues for their hard work serving customers so well. As we approach the Christmas season, we are looking forward to sharing the quality of our festive food with customers, and can’t wait for them to taste it. We are in good shape, with volume growth delivering strong financial performance.
“This builds on our track record of delivery for all our stakeholders. Our strong momentum allows us to continue to focus on value, quality, innovation, and the broader customer experience, whilst investing in growth opportunities in a disciplined, returns-focused way.”
