Tesco sales boosted by online shopping as consumers hunt for ‘value’

Tesco has unveiled a jump in sales for the first half of the year amid an online shopping boost and raised its annual profit outlook, despite cautioning that economic uncertainty was weighing on consumer confidence.

The UK’s biggest supermarket chain said sales, excluding fuel and VAT, totalled £33.8 billion for the 26 weeks to August 29.

Sales were 1% higher when compared like-for-like with the same period last year, and 1.5% higher in the UK alone.

Online sales surged by 8.4% in the UK with average grocery orders growing, and sales for its rapid delivery arm Whoosh soaring by 37%.

The company revealed its adjusted operating profit jumped by 6.3% to £1.8 billon.

Tesco said a strong financial performance for the first half meant it was now expecting profits of between £3.15 billion and £3.3 billion for the full year – an improvement on the £3 billion to £3.3 billion range it had previously guided.

Consumer confidence has been “relatively resilient” but “ongoing political tensions continue to create uncertainty”, the company said, which was translating to demand for a better value weekly shop.

Nevertheless, the supermarket’s “Finest” range of more premium products saw sales jump by 9% in the UK.

Meanwhile, fuel sales surged by nearly a fifth year-on-year which it attributed to higher oil prices pushing up the cost for consumers.

Ken Murphy, Tesco’s chief executive, said: “Against an uncertain external backdrop, we have continued to invest in giving customers the very best value for money.

“Our focus remains on helping customers get the best possible value from their weekly shop.

“Looking ahead, we’re excited to bring our new Christmas ranges to customers and help them enjoy a great festive season.”