BUSINESS LIVE: Tesco profits near £2.8bn; THG returns to revenue growth; M&C Saatchi earnings slump

Rising commodity prices were not enough to prop up the London stock market as defence shares tumbled.

On a subdued day of trading, the FTSE 100 dipped 0.1 per cent, or 8.68 points, to 7934.79 and the FTSE 250 descended 0.5 per cent, or 91.23 points, to 19,763.35.

Brent crude headed towards $91 a barrel and even after giving up its gains it remains up more than 15 per cent so far this year.

Tesco expects even stronger profitability this year after bumper demand lifted 2023 earnings by 11 per cent to almost £2.8billion.

Britain’s biggest supermarket group forecast retail adjusted operating profit, its key profit measure, of ‘at least’ £2.8billion this year, after 2023 earnings beat forecasts of just under £2.5billion.

Group sales, excluding VAT sales tax and fuel, rose 7.4 per cent to £61.5billion, with UK like-for-like sales up 7.7 per cent.

Boss Ken Murphy said:

‘This strong performance reflects the hard work of colleagues across the whole Tesco Group, and their commitment to serving our customers.  Customers are choosing to shop more at Tesco, which is reflected in growing market share as they respond to the improvements we’ve made to the value and quality of our products.

‘Inflationary pressures have lessened substantially, however we are conscious that things are still difficult for many customers, so we have worked hard to reduce prices and have now been the cheapest full-line grocer for well over a year.  We have continued to invest in helping customers where it matters most, cutting prices on more than 4,000 products and doubling down on our powerful combination of Aldi Price Match, Low Everyday Prices and Clubcard Prices. 

‘Customer perception of the quality of our products is growing ahead of the market and we continue to win customers from premium retailers, with sales of Tesco Finest now exceeding £2bn.’