Tesco, the supermarket giant, recently increased its annual profit forecast as it achieved a successful market share during the first half of the year. This improved performance sets the stage for the crucial holiday season trading time. Tesco’s stores in Ireland exhibited a like-for-like sales increase of 4.7% in the financial year’s first half, with a total revenue minus fuel and VAT reaching €1.7 billion over the six-month period. The group currently holds 23.5% of the market share in Ireland, marking an 88 basis point increase from the previous year.
Tesco is now anticipating a retail operating profit of approximately £2.9 billion (€3.5 billion) for the financial year of 2024/25, an improvement on the earlier estimation of roughly £2.8 billion. The company earned £2.76 billion the previous financial year, 2023/24.
The grocery chain attributed this growth to the opening of new stores, steady investments in product quality and innovation, as well as refurbishments of existing stores. Food sales saw a 5.4% growth, whereas non-food items witnessed a minor slump by 0.8%, largely due to the transition towards the recent partnership with The Entertainer.
Regarding UK sales, they saw a 4% increase on the whole. The supermarket’s shares have observed a 22% climb this year, mostly due to the pricing strategy where it matches the prices of discounted products from Aldi on hundreds of well-liked items. Its Clubcard loyalty scheme, which offers discounted prices for members, also proves favourable. Both these initiatives are funded by reducing business costs.
In the first six months, Tesco earned a retail operating profit of £1.56 billion, marking a 10% growth on a constant currency basis. “We are in a solid position, with volume growth resulting in strong financial performance,” said CEO Ken Murphy, highlighting the substantial gains in the UK and ROI (Ireland) market share over the past year.