Tesco has raised its profit forecast for the year to £2.6bn and £2.7bn, up from £2.5bn as sales and profits jumped in the first half.
The leading retailer’s adjusted operating profit rose by 13.9% to £1.48bn and total revenue including fuel was up 5% to £34.1bn.
UK like-for-like sales were also up 8.7% in the first half to 26 August 2023.
Tesco CEO Ken Murphy said: “Food inflation fell across the half and while external pressures remain, we expect that it will continue to do so in the second half of the year.”
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The grocer said it was “consistently the cheapest of the full-line grocers across the first half”, as it cut prices on 2,500 products with average savings of 12%.
It has also introduced more affordable own-brand products in its Express convenience stores, which has seen savings of up to 40% in comparison to the products replaced.
Murphy said: “Customers are responding well, contributing to market share gains in store and online. We’re seeing the results at both ends of the basket, with strong growth in our Finest range as shoppers look to save by treating themselves at home, voting with their feet as they switch from premium retailers to Tesco.”
As well as having raised its profit outlook, looking ahead, the supermarket has said it will continue to prioritise investment in its customer offer and work with suppliers to reduce prices where it can.
“We are in a strong position to keep investing for customers, and will continue to lower prices wherever we can – doing everything in our power to make sure customers can have a fantastic, affordable Christmas by shopping at Tesco,” Murphy added.
