Tesco, Britain’s biggest retailer, warned its profit would fall in the current year due to the tough economic conditions and pressure on consumers after it reported a 35.8 per cent rise for the 2021-22 year.
The group, which has an over 27 per cent share of Britain’s grocery market, said on Wednesday it made retail adjusted operating profit of £2.65 billion in the year to Feb. 26 – in line with guidance of slightly above £2.6bn and up from £1.96bn in 2020-21.
For the 2022-23 year it forecast retail adjusted operating profit of between £2.4-2.6bn.
“Given the significant uncertainties in the external environment, we believe it is appropriate to provide profit guidance in the form of a wider than usual range,” Tesco said.
Inflation jumped to 7 per cent in March, official figures showed on Wednesday.
Tesco said three factors were likely to influence its performance – the return to more normal customer behaviour after the Covid-19 pandemic, the level of cost inflation and its ability to partially offset it through more savings, and the investment required to maintain its price position relative to the market.
Tesco said total group sales rose 3 per cent to £54.8bn in its 2021-22 year.
The group has to date returned £300 million to shareholders through a share buyback programme and has committed to a further £750m by April 2023.
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