London: British retail king Tesco rebounded into annual net profit on strong sales and restructuring, the group said Wednesday, as its recovery continued after a costly accounting scandal the prior year.
The supermarket giant revealed in statement that earnings after taxation rebounded sharply to £1.2 billion (Dh6.3 billion, $1.7 billion, €1.4 billion) in its 2017/2018 financial year to February. That contrasted with a net loss of £40 million in 2016/2017.
Excluding exceptional items, operating or underlying profit jumped 28 per cent to £1.6 billion, in line with company forecasts and after a major restructuring overseen by chief executive Dave Lewis.
Total sales grew almost three per cent to £57.5 billion despite tough times in Britain, where high inflation has eroded consumers’ purchasing power.
“This has been another year of strong progress, with the ninth consecutive quarter of growth,” said Lewis.
“More people are choosing to shop at Tesco and our brand is stronger, as customers recognise improvements in both quality and value.
Tesco, which completed its vast £3.7-billion takeover of British wholesaler Booker last month, added that it was on course to deliver at least £200 million of annual cost savings from the deal.
“I am delighted to have completed our merger with Booker, and we are moving quickly to deliver synergies and access new growth, making the most of the complementary skills in our combined business,” added Lewis.
Tesco, which is the world’s third-biggest supermarket chain after France’s Carrefour and global leader Wal-Mart of the United States, has been troubled in recent years by the accounting scandal and fierce domestic competition from German discount chains Aldi and Lidl.