Tesco’s full-year retail sales rose 4.3% to £66.6bn, ignoring exchange rates. The uplift was driven by growth across all business divisions and regions, as market share reached its highest level in a decade.
Underlying operating profit grew at a slower pace of 0.6% to £3.2bn (£3.2bn expected), due to cost inflation.
Free cash flow was up 11.8% to £2.0bn (£1.7bn expected). Net debt rose 12% to £10.6bn, as the proceeds from last year’s £0.7bn sale of its banking operations have since been returned to shareholders.
For the year ahead, full-year underlying operating profits are expected to be between £3.0-3.3bn. Free cash flow is expected to land between £1.5-2.0bn.
Full-year dividends increased to 14.5p per share, up 5.8%
The shares were up 3.2% in early trading.
Our view
HL view to follow.
Tesco key facts
All ratios are sourced from LSEG Datastream, based on previous day’s closing values. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn’t be looked at on their own – it’s important to understand the big picture.
This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by LSEG. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.
This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment.