3rd Oct 2018 07:43
LONDON (Alliance News) - The UK's biggest supermarket Tesco PLC said Wednesday that it is "firmly" on track to meet its medium-term ambitions after reporting growth in the first half of its financial year.
For the six months to August 25, the FTSE 100 grocer posted a rise in pretax profit of 2% year-on-year to GBP564 million from GBP553 million.
Revenue, including VAT and fuel, came in 12% higher than the prior year at GBP31.73 billion versus GBP28.33 billion. Excluding VAT and fuel revenue increased 13% to GBP28.29 billion from GBP25.16 billion.
However, almost doubled administrative expenses of GBP1.05 billion compared to GBP780 million partly offset the revenue increase.
By geography, the UK and Ireland, Tesco's biggest market, saw like-for-like sales up 3.8% year-on-year to GBP25.70 billion, Central Europe sales dipped 1.5% to GBP3.11 billion due to changed to Sunday opening regulations in Poland and Asia sales declined 7% to GBP2.36 billion.
Meanwhile Tesco Bank achieved GBP547 million in revenue.
Chief Executive Officer Dave Lewis said: "We have made a good start to the year. The step up in the second quarter is driven mainly by the UK & ROI and delivers our eleventh consecutive quarter of growth.
"We are firmly on track to deliver our medium-term ambitions and are continuing to improve the quality and value of our offer for customers in all of our markets. In doing so, we are well-positioned to deliver strong, sustainable returns for shareholders."
Tesco hiked its interim dividend by 67% to 1.67 pence per share from 1.0p a year ago.
Looking ahead, the grocer said it delivered GBP1.1 billion in costs savings so far, steadily approaching its GBP1.5 billion target set in 2016.
Last month, Tesco launched its own discount chain, Jack's, in a bid to fight German discounters Aldi and Lidl who are shaking the UK's grocery market increasing sales and market share faster than all other contenders.
However, Tesco did not provide any more detail on Jack's in its result statement.
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