Tesco profits rise

Tesco unveiled strong first-half figures this morning, proving its continued dominance of UK retail. Pre-tax profits increased to£908 million, a rise of 18.7 per cent.

The results have put the supermarket on track to create 7,500 UK jobs in the second half.

The profits rise, which exceeded analysts' expectations, was a result of 'improving the shopping experience for customers in our business around the world. We have been able to deliver another good performance in a more challenging year,' said chief executive Sir Terry Leahy.

Tesco's share of the grocery market is estimated to be 30.5 per cent, up from 28.1 per cent last year. Sales were also boosted by the international market, which accounts for 54 per cent of group selling space.

The grocer's sales were also helped by the opening of 630,000 sq ft (58,530 sq m) of retail space, much of which is dedicated to non-food. This is an area of growth for the retailer, with UK non-food sales up 13 per cent to£2.8 billion.

Leahy is reported to have quashed speculation that Tesco would be bidding for US group Albertsons.