Tesco has reported a rise in sales for the first half of the year, driven by an online shopping boost, and has raised its annual profit outlook despite cautioning that economic uncertainty is weighing on consumer confidence.
Sales and profit figures
The UK's biggest supermarket chain said sales, excluding fuel and VAT, totalled £33.8 billion for the 26 weeks to August 29. Sales were 1% higher on a like-for-like basis compared with the same period last year, and 1.5% higher in the UK alone.
Online sales surged by 8.4% in the UK, with average grocery orders growing, and sales for its rapid delivery arm Whoosh soared by 37%. The company revealed that adjusted operating profit jumped by 6.3% to £1.8 billion.
Profit outlook and consumer confidence
Tesco said its strong financial performance for the first half meant it now expects profits of between £3.15 billion and £3.3 billion for the full year, an improvement on the £3 billion to £3.3 billion range it had previously guided.
The company said consumer confidence has been "relatively resilient" but that "ongoing political tensions continue to create uncertainty", which was translating into demand for a better value weekly shop. Nevertheless, the supermarket's "Finest" range of premium products saw sales jump by 9% in the UK.
Fuel and outlook
Fuel sales surged by nearly a fifth year-on-year, which Tesco attributed to higher oil prices pushing up costs for consumers.
Ken Murphy, Tesco's chief executive, said: "Against an uncertain external backdrop, we have continued to invest in giving customers the very best value for money. Our focus remains on helping customers get the best possible value from their weekly shop. Looking ahead, we're excited to bring our new Christmas ranges to customers and help them enjoy a great festive season."
