Tesco reports profits up 28% as turnaround nears completion

Tesco has reported a 28% jump in profits as its turnaround plan nears completion.

Full year pre-tax profits for Britain’s biggest supermarket were £1.67 billion (up 28.8%) while same store sales for Tesco grew 1.7%.

Chief executive Dave Lewis said the group was on track to meet the “vast majority” of the turnaround goals he set when he was appointed four years ago, following a major accounting scandal at the company.

He said: “After four years we have met, or are about to meet, the vast majority of our turnaround goals. I am very confident that we will complete the journey in 2019/ 2020.”

Lewis oversaw the takeover of wholesaler Booker in 2017. He also launched a discount chain – Jack’s – to take on the discounters Aldi and Lidl, and Tesco said it has had a “strong response” from the eight new stores.

Booker “bulk buys” are already being offered in a number of Tesco stores and this will be expanded this year, while more Jack’s stores are also in the pipeline, with seven planned for this year alone.  

Over the past year Tesco also re-launched 10,000 own brand products and introduced eight new ‘Exclusively at Tesco’ brands.

The company also reported an increase in customer numbers – up by an estimated 149,000 this year.

Lewis said: “We have restored our competitiveness for customers – including through the introduction of ‘Exclusively at Tesco’ – and rebuilt a sustainable base of profitability.”

The retailer stil faces a difficult trading environment with the uncertainty of Brexit looming as well as the potential merger of Sainsbury's and Asda. 

In January Tesco announced 9,000 jobs were at risk across its head office and stores as part of a major cost-cutting drive. 

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