Tesco reports strong performance in FY 2023/24
Tesco Bank saw an improvement in performance reaching £69 million compared to £22 million in 2023
Print11 April 2024
Tesco plc has released its preliminary results for the fiscal year 2023/24, showcasing significant market share gains and a return to positive volume growth as customers increasingly choose to shop at Tesco.
Performance highlights
Group sales (excluding VAT and fuel) reached £61,477 million (€71,826 million), marking a 7.4% increase compared to the previous fiscal year. Adjusted operating profit rose to £2,829 million (€3,305 million), reflecting a 12.8% increase.
Tesco Bank saw a substantial improvement in performance, reaching £69 million (€80 million) compared to £22 million (€25 million) in the previous year. The company achieved a statutory profit before tax of £2,289 million (€2,674 million), representing a significant increase from £882 million in the prior year. Retail free cash flow stood at £2,063 million (€2,410 million) with net debt reduced to £9,764 million (€11,407 million), reflecting a 6.9% decrease.
Key Insights
Tesco’s strong sales performance was evident across all markets, with Retail Like-For-Like (LFL) sales up 6.8%. In the UK and Republic of Ireland (ROI), LFL sales increased by 7.3%, with Tesco’s value and volume shares rising consistently.
The company maintained a disciplined approach to investment while focusing on value, quality, and service, resulting in overall gains in both value and volume share.
Tesco continued its commitment to sustainability and community support, including the launch of the Stronger Starts programme, which funds activities and nutrition in thousands of projects. The proposed sale of banking operations to Barclays is expected to generate approximately £700 million (€817 million) in cash.
Outlook
Tesco anticipates retail adjusted operating profit of at least £2.8 billion (€3.2 million) for the 2024/25 financial year. The company remains focused on offering value, quality, and convenience to customers, leveraging digital capabilities, and driving top-line growth.
Ken Murphy, chief executive, Tesco, said: “Inflationary pressures have lessened substantially, however we are conscious that things are still difficult for many customers, so we have worked hard to reduce prices and have now been the cheapest full-line grocer for well over a year. We have continued to invest in helping customers where it matters most, cutting prices on more than 4,000 products and doubling down on our powerful combination of Aldi Price Match, Low Everyday Prices and Clubcard Prices.
“Customer perception of the quality of our products is growing ahead of the market and we continue to win customers from premium retailers, with sales of Tesco Finest now exceeding £2bn. We have strong momentum in our business, and are encouraged by signs of improving consumer sentiment.”
Read more: Tesco Ireland opens new store on Townsend Street
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