Tesco Profits Rise but Face War-Driven Pressure

Tesco, Britain's largest supermarket chain, has cautioned that profits may face pressure in the coming year amid heightened uncertainty from the war in Iran, which threatens to disrupt energy supplies and erode consumer confidence.

The retailer reported adjusted operating profits of 3.15 billion pounds for the 52 weeks ended February 28, a slight increase from 3.13 billion pounds the previous year. Sales excluding value-added tax and fuel rose 4.6 percent to 66.6 billion pounds, contributing to overall group sales growth of 5.4 percent to more than 73 billion pounds. These figures exceeded analyst expectations and reflect Tesco's strengthened market position, with its share reaching 28.7 percent in the 12 weeks to late December, the highest in over a decade.

Looking ahead, Tesco guided for adjusted operating profits between 3 billion and 3.3 billion pounds for the current financial year, a broader range than initially planned. The company attributed the wider forecast to the ongoing conflict in the Middle East, which began at the end of February and has already driven up fuel prices through disruptions to energy production and shipments via the Strait of Hormuz. Chief Executive...