Tesco has confirmed its full-year profit forecast as it reported an increase in underlying sales for the crucial Christmas trading period, in line with analysts’ expectations. The supermarket giant revealed it had gained market share from competitors across both the UK and Ireland.
In its latest trading update, Tesco reported a 4.1% increase in UK Christmas sales. Meanwhile, sales in Ireland rose by 4.8% during the festive period, contributing to a 4.2% increase in sales during its fiscal third quarter.
The company highlighted its strong performance in fresh food, particularly in Ireland, where it has maintained a remarkable 34 consecutive periods of market share growth. Tesco’s fresh food volume saw an increase of 2.1%, driven by the ongoing success of its “fresh first” program. In addition, the company’s Irish online sales surged by 17.1%, bolstered by the introduction of same-day Click & Collect and home delivery services.
Tesco Ireland’s CEO Natasha Adams praised the company’s results, attributing the success to the business’s commitment to providing an exceptional shopping experience. She noted the company’s significant investments in expanding its store network, with four new stores opened during the third quarter, as well as multi-year contract extensions with key suppliers and improvements in employee pay and benefits.
“These initiatives underscore our ongoing commitment to building a thriving Irish economy,” Adams said.
Tesco also affirmed its full-year outlook, maintaining its expectation for retail adjusted operating profit of around £2.9 billion for the year ending February 2025. This figure marks an increase from the £2.76 billion achieved in 2023/24. The company holds a 28.5% share of the UK grocery market.
Under the leadership of CEO Ken Murphy, Tesco has benefited from a strategic programme aimed at enhancing the value and quality of its products, increasing innovation, and improving customer service.
“We delivered our biggest ever Christmas, with continued market share growth and switching gains,” said Murphy, emphasizing the company’s successful performance during the key holiday period.
However, Tesco warned that it would face additional costs of approximately £250 million annually due to the UK government’s upcoming hike in social security payments, set to take effect in April. Despite these challenges, the company remains optimistic about its financial outlook and continued growth.
