"The UK's largest supermarket group now expects to deliver annual profits of up to £3.1bn, £100m higher than previous guidance, after its decision to cut prices on 6,500 products by an average of 9% drew in more customers. Tesco said its grocery inflation was running "well behind" the latest industry rate of 4.9%, according to figures from Worldpanel."
"'Some of our competitors went pretty strong on their statement of intent at the start of the year and have acted on that. It doesn't feel that rational. We are anticipating the second half could be more intensive, not less,' Murphy said. He added that Tesco would be 'pulsing in strong deals' over the next three months but warned that shoppers were already showing signs of nervousness ahead of the November budget. Tesco reported a 5.1% rise in group sales to £33bn in the six months to 23 August, with UK like-for-like sales up 4.9%. Trading was boosted by the warm summer, which lifted sales of barbecue foods, and by a shift in consumer behaviour, with customers buying more premium ready meals and fresh produce to cook at home rather than eating out."
Tesco expects annual profits of up to £3.1bn, £100m higher than previous guidance, after cutting prices on 6,500 products by an average of 9%, which attracted more customers. Tesco's grocery inflation is running well below the industry's 4.9% rate. Rivals have signalled intentions to compete aggressively on price, raising expectations of an intensified price battle before Christmas. Group sales rose 5.1% to £33bn in the six months to 23 August, with UK like-for-like sales up 4.9%. Pre-tax profits fell 6.3% to £1.3bn due to restructuring charges, banking separation and price-reduction investments. Efficiency savings and AI-driven forecasting helped offset some financial pressures.
Read at Business Matters
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