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Tesco profits take a tumble

Tesco profits take a tumble
Photo: Tesco

Tesco has announced a fall in pre-tax profits of nearly 20% in the past year to £825 million, due to costs rising by almost £900 million due to the pandemic, reports Retail Gazette. The major increase in sales during the past 12 months was not enough to offset the spiralling extra overheads. Tesco hired almost 50,000 temporary workers during the pandemic, about 20,000 of whom have joined the retailer permanently.

Tesco said group sales excluding fuel increased by 7% to £53.4 billion for the year to February, driven by soaring online sales. In its core UK and Ireland market, Tesco’s full-year sales were up 8.6% to £48.8 billion. Online sales jumped by 77% to £6.3 billion in the UK.

Tesco chief executive Ken Murphy said: “Tesco has shown incredible strength and agility throughout the pandemic. By putting our customers and colleagues first, we have built a stronger business.”

 

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Morrisons’ profits plunge in 2020

Morrisons’ profits plunge in 2020
Photo: Morrisons

UK retailer Morrison’s has announced a 50.7% fall in profits to £201 million for the year to January 31. The plummeting profits are mainly due to the additional £290 million in costs linked to the Covid-19 pandemic. A large contributor is an increase in staff absences, as well as the £230 million impact of handing its business rates relief back to the Treasury.

Like-for-like sales (excluding fuel and VAT) rose by 8.6% thanks to strong grocery demand, with the final quarter seeing 9% growth. Full-year revenue was up by only 0.4% to £17.6 billion. 

However, Morrisons’ online sales tripled during the year and its capacity jumped five-fold.

 

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Greenyard announces dip in sales of 1.7%

Green shoots appear for Greenyard as it sets out on road to recovery

Global market leader in fresh produce Greenyard has announced a slight dip in sales over the past twelve months. In the year ending March 31st 2018, the group’s net sales declined by 1.7% to €4.175 billion. Results were below expectations due to pricing pressure in the group’s main markets and a number of one-offs. Volumes were lost in some core fresh markets. Lower volumes led to a fall in fresh sales of 2.4%, which were also affected by an unfavourable sterling exchange rate.  Meanwhile, horticulture sales were up 20.2%, mainly thanks to the acquisition of Mykogen and favourable exchange rates.

The group’s gross operating profits (REBITDA) decreased by 3.8% to €140.2 million, mainly as a result of the aforementioned losses in the fresh category. Long Fresh continued to improve, even in difficult markets, mainly thanks to an improved product mix and increase in prices in the frozen segment. However, these improvements were largely offset by rising raw material costs that could not be passed on to customers under annual contracts. Profits in the horticulture segment were up by €1.5 million, which was somewhat offset by the postponement of the expected spring sales season in March due to the bad weather in Belgium.

Greenyard has announced that it expects REBITDA to rise by 10% over the coming year. In its statement, Greenyard said, “We remain committed to steer our organisation closer to our customers to jointly create a strategic view on fruit and vegetables in our mutual interest. By keeping our focus on creating added value in partnership with and for our growers, our retailers and our consumers, we are confident that we can make the difference in strengthening our position as a global leader in fruit and vegetables in all its forms”.