Tesco 'outperforms' with sales and profits growth

Tesco has seen sales and profits grow more than expected as Britain's biggest supermarket group shrugged off the impact of the pandemic.

In the six months to August, Tesco said it "outperformed" the grocery sector but also flagged that the sales surge could now start to "fall away".

But it would still mean stronger profits growth this year than was first thought, a Tesco statement said.

The industry-wide impact of supply chain problems also seemed less severe.

Ken Murphy, chief executive of Tesco, said: "With various different challenges currently affecting the industry, the resilience of our supply chain and the depth of our supplier partnerships has once again been shown to be a key asset."

The group forecast a full-year 2021-22 retail operating profit of between £2.5bn and £2.6bn. Tesco, which has a 27% share of Britain's grocery market, made retail operating profit of £1.38bn in the first half - ahead of analysts' average forecast of £1.26bn.

Sales in the first six months of Tesco's financial year rose 2.6% to £27.3bn, while UK like-for-like sales rose 1.2%, having risen 0.5% in the first quarter.