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Gloucestershire Business News

Every little helps: Tesco profits jump as company hails buyback of two Gloucestershire stores

The buyback of two Gloucestershire stores was highlighted by Tesco in their preliminary results released today.

Tesco announced an increase in pre-tax profits of 28.8 per cent this morning to £1.67billion.

Revenue was also up with £63.9billion ticking through tills in 2018/19, an 11 per cent increase on the 2017/18 figures.

The results are ahead of expectations, according to the company with chief executive Dave Lewis saying the turnaround of the company was nearly complete.

Lewis joined Tesco in the wake of the accounting scandal in 2014 when the company overestimated their profits by £250million.

He set out six strategic drivers to put the company back on track, one of which was ton maximise the value from property.

And the results published today show that the company released a further £285million in value from property, including the buybacks of their Stroud Superstore and Cirencester Extra outlets.

Hailing the ahead of expectation results, Lewis said: "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.

"I'm delighted with the broad-based improvement across the business.

"We have restored our competitiveness for customers - including through the introduction of 'Exclusively at Tesco' - and rebuilt a sustainable base of profitability."

Like-for-like sales in the UK and Ireland were up by 2.9 per cent, aided by the 2017 acquisition of the Booker cash and carry stores at the end of the 2017/18 financial year.

The annual profit margin was 3.45 per cent and the group has issued a year-end dividend of 4.1p, returning 5.77p per share for the year.

Lewis added: "The full year margin of 3.45 per cent represents clear progress and the second half level of 3.79 per cent, even before the benefit of Booker, puts us comfortably in the aspirational range we set four years ago.

"I'm pleased that we are able to accelerate the recovery in the dividend as a result of our continued capital discipline and strong improvement in cash profitability."

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