has reported a 15% increase in group operating profit to £3.206bn in its preliminary results for 2008/09. Online, "Tesco.com has delivered another excellent performance, with our on-line businesses achieving a 20% increase in sales to £1.9bn, with profits, after initial start-up losses on Tesco Direct, rising to £109m," the retailer reports.
"We are continuing to see robust growth in customer and order numbers and operationally the business made further progress, with improved product availability, and strong productivity. Growth in the international businesses – in Korea and Ireland – was very strong," says Tesco.
"Tesco Direct, which is managed within Tesco.com, is designed to extend the reach of our non-food offer by making it more available to customers via the internet and catalogues and is now established and thriving," the report continues. "It has delivered excellent sales growth and reduced losses as planned. We issued 11.5m catalogues last year and now have 12,500 products available on-line. The popularity of our in-store Direct desks, which are now in 231 stores, continues to increase as more customers order and collect items from their local Tesco. We plan to add clothing to our on-line offer later this year."
Chief executive Sir Terry Leahy explains that "At a time when customers everywhere are feeling the economic strain, we are responding to their changing needs in all our markets by lowering prices, introducing more affordable products and offering even sharper promotions. These actions, combined with our core strengths — in selling food and everyday essentials, owning our own property and having a broad business base — are helping us to cope well with the effects of the downturn."
"As a result, we have delivered a solid sales and profit performance, both in the UK and internationally, whilst continuing to invest in our long-term strategy for growth," he added. "We have made a good start to the new financial year and I am confident Tesco will continue to make good progress even in the current global economic environment."
You can download a pdf copy of the full preliminary results report from Tesco's website