UK retailer Tesco has released its Interim Results Trading Statement 2023/24, showcasing an increased operating profit when compared to results from 2022/23. CEO Ken Murphy attributes the retailers success to its status as “the cheapest full-line grocer.”
According to the statement, UK ROI like-for-like (LFL) sales were up 8.4% year-on-year (YoY). UK were up 8.7%, ROI up 6.9% and Booker up 7.5%.
Retail adjusted operating profit in UK and ROI was £1,371 million, up 17.2% YoY, with accelerated cost savings and a “resilient” volume performance offsetting cost pressures.
Statutory revenue was up £34.1 billion, up 5% at actual rates. The retailer’s statutory operating profit finished the year at £1,482 million, up 105.5%. Profit before tax was £1,217 million, up 207.3%.
In-store changes reflected in interim results
Tesco cut prices on around 2,500 products by the end of the half, reporting an average saving of about 12%. It also boasted over 8,000 products now in its ‘Clubcard Prices’ scheme, and calculated a saving of up to £390 for customers each year.
A total of 335 new products were introduced, while a further 1,150 were reformulated.
Net switching gains from premium retailers for 13 consecutive periods strengthened the Finest range leading to both sales and volume growth, and more than 150 new Finest products were placed on Tesco shelves.
More own brand products were stocked in Express stores, making savings of up to 40% when compared to the products they replaced.
The retailer described itself as the “cheapest full-line grocers across the half” after including over 650 lines in its Aldi Price Match scheme, price locking more than 1,000 products and distributing “exclusive” Clubcard Prices deals.
Focusing on customers and keeping food bills down
Ken Murphy, Tesco chief executive, 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.
“We’re seeing the results at both ends of the basket, with strong growth in our Finest range as shoppers look to save by treating themselves at home, voting with their feet as they switch from premium retailers to Tesco.
“Food inflation fell across the half and while external pressures remain, we expect that it will continue to do so in the second half of the year. 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.”
