- Tesco’s sales rose 4.5% to £15.6bn in the 13 weeks ending May 25.
- Chief executive Ken Murphy received a £10m compensation package over the past year
Tesco maintained its full-year guidance by recording healthy sales growth in the first quarter, driven in part by increased numbers of shoppers buying its Finest range of products and using its fast online delivery service, Whoosh.
Britain’s largest supermarket chain said sales from continuing operations, excluding fuel, rose 4.5 percent at constant currency levels to £15.6 billion in the 13 weeks ending May 25. .
Like-for-like retail revenue rose 3.4 per cent following a strong result in the British Isles, where the group enjoys growing volumes and market share.
Good result: Tesco revealed that sales from continuing operations, excluding fuel, rose 4.5 per cent at constant currency levels to £15.6bn in the 13 weeks ending 25 May.
In the United Kingdom, the company’s food sales rose 5 percent thanks to strong demand for fresh products, while non-food orders were boosted by higher purchases of clothing.
It also benefited from an 8.9 per cent rise in online turnover, helped by the popularity of its fast delivery service, Whoosh, and 12.5 per cent growth in sales of its premium Tesco Finest range to despite cost of living pressures.
Following the strong performance, the company still anticipates full-year adjusted operating profits of at least £2.8 billion from its retail operations and approximately £80 million from its Tesco Bank business.
In addition to this, it believes retail free cash flow generation will be within its guidance range of £1.4bn to £1.8bn.
Ken Murphy, chief executive of Tesco, said: “We have continued to build momentum in the business, with strong volume growth in the UK, Republic of Ireland and Central Europe supported by a reduction in inflation.”
“We remain the cheapest and most competitive full-line grocer we have ever been, and our value, product quality and service drive improved brand perception and customer satisfaction.”
Murphy received a compensation package of almost £10m last year, more than double the £4.4m he was awarded the previous year.
The amount received backlash from the Unite union and some shareholder groups, partly because it is 431 times the £23,010 the average Tesco worker earns annually.
Investors will vote on remuneration at Tesco’s annual general meeting on Friday, which will be held at its headquarters in Welwyn Garden City, Hertfordshire.
In the last financial year, Tesco’s pre-tax profits soared 159 per cent to £2.3bn, its best result in more than a decade, while turnover rose 7.4 per cent to about £61.5 billion.
Since then, the company’s market share has continued to grow, reaching 27.6 percent in May, according to industry research provider Kantar.
Sophie Lund-Yates, senior equity analyst at Hargreaves Lansdown, said: “Tesco has done an exceptionally good job of growing its market share, given the increasing competition.
‘Its full-line offering sets it apart from the likes of Aldi, and its product proposition puts it ahead of other big names.
“Tesco’s huge scale means it works more like a utility company in some ways: everyone needs to put dinner on the table, and an increasing number of customers buy it at a Tesco.”
tesco stock They rose 1.6 per cent to 307.3p on Friday morning, making them one of the biggest risers on the FTSE 100 index.
