Tesco has said that profits could dip over the current year as it flagged increased uncertainty linked to the conflict in the Middle East.
The UK’s largest supermarket group reported stronger-than-expected adjusted operating profits of £3.15 billion for the year to February 28, up slightly from £3.13 billion a year earlier.
The retailer said it expects this to be between £3 billion and £3.3 billion over the current financial year, telling shareholders it was “providing a wider range of guidance than we were previously planning” due to uncertainty caused by the Iran war.
Tesco also revealed that sales, excluding VAT and fuel, grew by 4.6% to £66.6 billion for the past year.
The group said on Thursday that it plans to make a further £500 million in cost savings in 2026/27, after surpassing its £535 million savings target last year.
Ken Murphy, chief executive of Tesco, said: “We are committed to doing whatever we can to help keep down the cost of the weekly shop, and with the conflict in the Middle East creating further uncertainty for consumers and the economy more broadly, that commitment matters more than ever.
“Over the last year, despite cost pressures from new regulation, we have increased our investments in keeping prices low, further improving quality and offering even better service.
“Customers are choosing to shop more with us as a result, leading to our highest market share for over a decade.”
