Belfast Telegraph

Tesco chief hails surge in profits for retail giant

By Holly Williams

Tesco boss Dave Lewis has hailed a "significant milestone" in the firm's turnaround after unveiling the first dividend payout for three years following a surge in half-year profits and sales.

The group posted a better-than-expected 27% rise in group underlying earnings to £759m for the six months to August 26 after it notched up its seventh quarter in a row of rising sales.

The grocery chain has around 50 stores in Northern Ireland. According to the latest research by analysts Kantar Worldpanel, it's grown its share of consumer spending in supermarkets here by 0.5% to 35%.

UK like-for-like sales in the second quarter lifted 2.1%, although this marked a slowdown against 2.3% in the previous three months.

Mr Lewis cheered the group's move to resume paying shareholder dividends for the first time since it was thrown into crisis after an accounting scandal in 2014, with a 1p a share interim payout.

He said: "It's a significant milestone in the recovery of the business and one which demonstrates the confidence we and the board have in our plans."

Mr Lewis said efforts to keep prices low in the face of Brexit-fuelled inflation helped attract 300,000 more customers than a year earlier. The group said its inflation was around 1% lower than across the rest of the supermarket sector as it worked with suppliers to protect customers from inflationary pressures.

Industry-wide inflation is running at around 2.7% to 3.2%, according to the group.

The results signal that its recovery is in full swing following the 2014 accounting scandal and intense competition from German discounters Aldi and Lidl.

UK and Ireland operating profits leapt 21% higher to £471m in its first half, while on a statutory basis, group pre-tax profits rose from £71m to £562m. But the group has come under heavy fire in recent days over its own-brand chicken after it was discovered that supplier 2 Sisters had taken Lidl chicken and repackaged it under Tesco's Willow Farms brand.

Belfast Telegraph