By Adriano Marchese

 

Tesco PLC (TSCO.LN) said Wednesday that pretax profit rose 29% in fiscal 2019 and that it is making progress toward its cost savings target.

The U.K. supermarket chain said pretax profit was 1.67 billion pounds ($2.18 billion) in the year ended Feb. 23, compared with GBP1.3 billion in fiscal 2018. Adjusted operating profit--Tesco's preferred metric that strips out exceptional and other one-off items--rose 34% to GBP2.21 billion, compared with a FactSet forecast of GBP1.57 billion based on five analysts estimates.

Sales for the year were up 11% at GBP63.91 billion, compared with a forecast of GBP64.07 billion, according to a FactSet-provided consensus of 12 analyst estimates.

Tesco, which has been fighting to maintain its market share against discount grocers, said it reduced in-year costs by GBP532 million, with savings of GBP1.4 billion toward its target of GBP1.5 billion. Some of the measures of the savings program included closing Tesco Direct and developing more sustainable general merchandise categories, the company said.

The board declared a final dividend of 4.10 pence a share, bringing the total payout to 5.77 pence, up from 3.0 pence the year before.

"After four years we have met or are about to meet the vast majority of our turnaround goals. I'm very confident that we will complete the journey in 2019-20," Chief Executive Dave Lewis said.

 

Write to Adriano Marchese at adriano.marchese@dowjones.com

 

(END) Dow Jones Newswires

April 10, 2019 02:45 ET (06:45 GMT)

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