Tesco has cautioned the Labour Party against implementing tax increases on businesses, despite generating profits exceeding £100 per second. The supermarket chain faced accusations of excessive corporate greed as it raised its full-year profit forecast to £1.67 billion over the past six months.
This surge in profits occurred alongside the April hike in employers’ national insurance contributions, with shareholders receiving a hefty £314 million half-year dividend. Ken Murphy, Tesco’s CEO, urged Chancellor Rachel Reeves to present a growth-oriented and job-supportive Budget, emphasizing the need to maintain industry competitiveness and value for customers.
In contrast, Sharon Graham, Unite’s general secretary, criticized Tesco for accumulating substantial profits and distributing large dividends while many workers struggle financially. She called for the Labour government to address corporate profit-driven practices and prevent workers from bearing the brunt of such behaviors.
Responding to inquiries about price reductions, Mr. Murphy highlighted Tesco’s commitment to all stakeholders and emphasized that its price inflation remains below the industry average, offering significant savings to Clubcard customers. The company’s stronger-than-expected half-year results, driven by customer acquisition from competitors, cost efficiencies, and favorable weather conditions, led to an upward revision of the annual profit target to between £2.9 billion and £3.1 billion.
Tesco’s market share has expanded to 28.4% this year, with UK half-year sales increasing by 4.9% and total sales surpassing £33 billion. Despite customer concerns about the Budget and economic prospects, Mr. Murphy expressed confidence in a successful Christmas period, anticipating heightened competition from rivals in the second half of the financial year.
Additionally, Tesco highlighted launching over 470 new products, including 300 in its premium Finest range, within the six-month period. The company’s online segment experienced notable growth, with sales up by over 11%, leveraging artificial intelligence for optimizing delivery routes and reducing weekly mileage by approximately 100,000 miles.
