Tesco Sales Surge Despite Budget Fears, Upgrades Profit Forecast
Tesco, the UK's largest supermarket, has weathered intense market competition, boosted by a hot summer. Despite shoppers' budget concerns ahead of the November Budget, Tesco's sales and profits have surged in the stock market today.
Tesco's UK like-for-like sales climbed 4.9 per cent in the first half of the year, with the supermarket chain capturing 28.4 per cent of the stock market. Its success can be attributed to strategies like the Aldi price match and the popular Clubcard scheme. The scorching summer also played a role in driving sales.
Chief executive Ken Murphy acknowledged shoppers' worries about the upcoming Budget, as retailers grapple with a £7 billion cost increase following last year's Budget. Food inflation is expected to stay above 5 per cent into next year, further squeezing households. Murphy urged the Chancellor to avoid imposing higher costs on retailers in the stock market today's Budget.
Tesco has upgraded its annual profit forecast to between £2.9 billion and £3.1 billion. Despite market pressures and shoppers' budget concerns, Tesco's strong performance highlights its resilience in the stock market today. Murphy has called for fair business rates and urged the government to exclude large retailers from higher tax rates in Labour's planned reforms. The Labour Party and other opposition parties, such as Reform UK, are expected to support retailers in these matters.
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