Tesco has shaken off its deep torpor of recent years to post a modest return to the type of surging profits the like of which it had once taken for granted.
Shrugging off despondency which has settled elsewhere on the High Street Tesco regained some of its former vim with a pre-tax profit of £1.3bn in the year up to 24 February, a healthy 795% increase on last year’s efforts and comfortably above expectations of £1.2bn.
These numbers vindicate a turnaround programme instigated by chief executive Dave Lewis, who has been busy selling off underperforming businesses and slashing costs while simultaneously splurging on advertising.
A report by Ebiquity yesterday suggested that Tesco now has the highest ad spend of all UK supermarkets with a 68.2% increase in above the line ad spend to £73.9m, comfortably outspending rivals who are all either flat lining or retrenching.
The apparent turnaround still leaves Tesco with room for improvement however, with its £1.3bn profit still far behind the £3bn it pocketed in 2013-14 prior to its recent slump.
The financial results were contained in Tesco’s first set of accounts to be published since its £3.7bn takeover of wholesaler Booker.