Tesco to shed light on sales as ‘awful April' bill hikes squeeze budgets
Tesco shareholders will be watching closely for signs that it is managing to fend off competition as the supermarket price war heats up and 'awful April' bill hikes eat into household income.
The UK's biggest supermarket chain will unveil its financial results for the first three months of its financial year on Thursday.
Tesco recently signalled that a price war was mounting within the sector, saying that it expects to make as much as £400 million less in profit in the year ahead as a result of what it called 'a very competitive market'.
Asda has promised its biggest price cuts in 25 years under returning boss Allan Leighton, in a bid to revive the languishing chain.
The rapid growth of discounters Aldi and Lidl in the UK has also driven more competition as supermarkets move to match some of their prices to low-cost alternatives.
Tesco is expecting to generate a group adjusted operating profit of between £2.7 billion and £3 billion for the year to February 2026, down from the £3.1 billion made over the latest year.
A group of analysts for AJ Bell said that, despite fears of a supermarket price war, Tesco's share price was close to a 12-year high.
'Asda's reboot under new chair Allan Leighton prompted such concerns but, for now, the competition seems relatively limited in scope, with a focus on Clubcard and loyalty scheme customers and loss-leaders that drive footfall,' they said.
'Mr Leighton claims he can see the green shoots of recovery at Asda, but the latest Kantar survey of market share in the UK grocery market suggests that Tesco, Aldi and Lidl continue to have both Asda and Morrisons for breakfast.'
Asda is the UK's third-largest UK supermarket, behind Sainsbury's, but remains close to being overtaken by Aldi which has seen its share of the market grow steadily.
Meanwhile, investors will be looking for an update from Tesco on how consumers are faring following the onset of higher bills during what has been dubbed as 'awful April'.
Household bills including for electricity, water, phone deals, and council tax rose for many from the beginning of the month.
Financial markets analyst Michael Hewson said trading updates from the UK's biggest retailers can give a strong indication of consumer trends and any signs of weakness in the UK economy.
He said Tesco's Booker division – the food wholesaler – was the 'main drag' on its latest annual sales figures, 'largely due to weakness in its tobacco business, as well as the fast-food market serviced by its Best Food logistics brand'.
'This business supplies the likes of Burger King, Pret a Manger, Pizza Express, Zizzi, Nando's and Pizza Hut, and saw a like-for-like sales decline of 5.1% to £1.44 billion,' he said.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
12 hours ago
- Yahoo
Aldi Is Declaring a Summer Full of Savings With Discounts on More Than 400 Items
Aldi is cutting prices on more than 400 summer products across categories like meats, organic produce, and pantry staples in all 2,400 U.S. stores through Labor Day 2025. Consumer concerns about grocery costs are significant, with the Pew Research Center reporting a 28.3% increase in food-at-home prices since January 2020 and 60% of U.S. adults citing food costs as a key factor in their shopping decisions. Aldi credits its ability to maintain low prices to its streamlined operations, including practices such as the quarter-cart system and limited in-store one of the fastest-growing grocery chains in the United States, Aldi is set to become America's favorite supermarket — and the brand is making sure of it by announcing that it's cutting prices on over 400 products for summer. With rising grocery prices posing an ongoing concern for many Americans, it isn't the first time Aldi has made it clear that the chain aims to meet customers where they are. Last year, Aldi CEO Jason Hart emphasized on Good Morning America, 'We don't really focus on what the competition is doing. We're focused on what consumers want and need.' The German chain put its money where its mouth was in 2024 by announcing major discounts on 250 items throughout the summer. This year, Aldi is taking its savings even more seriously by lowering grocery prices on nearly 25% of its products, totaling over 400 items across various aisles — including meats, organic produce, pantry items, and more — in all 2,400 U.S. stores from now through Labor Day. Related: These Aldi Items Are the Answer to Easy Meals, and the Internet Loves Them According to a press release provided to Food & Wine, the brand estimates that it 'will save customers $100 million this summer.' The discounts couldn't have come at a better time: Statistics reveal that two-thirds of Americans are very concerned about the costs of 'food and consumer goods.' "Aldi wants shoppers to focus on what summer is all about — grilling, camping, concerts, and quality time with friends and family — not stressing over grocery bills,' Scott Patton, Aldi's chief commercial officer, tells Food & Wine. 'From grilling essentials to road trip snacks, Aldi is lowering prices on summertime favorites to help stretch our shoppers' savings where it matters most. Customers can look for the red 'price drops' logo in stores and online to easily shop summer favorites at even lower prices." In a recent survey by the Pew Research Center, data revealed that about six in ten adults in the United States consider food costs to be extremely or very important when filling their shopping carts and deciding which products to purchase. The Pew Research Center also reports that 'The cost of food at home has climbed 28.3% since January 2020, before the COVID-19 pandemic hit the U.S.' Beyond that, recent survey data from KPMG indicates that 79% of consumers anticipate price increases for goods, including groceries, in the coming months. At the same time, many households are reporting a decrease in their income compared to last year. Related: Americans Are Turning to Short-Term Loans to Afford Their Groceries Even before these newly announced price cuts, customers have always turned to Aldi for its affordable groceries. Hart says, 'Our customers count on ALDI for the lowest prices of any national grocer, every day, and we never take that trust for granted.' Aldi's summer discounts will feature reduced prices on a wide variety of products, including meats (such as grass-fed ground beef and baby back ribs, both ideal for seasonal cookouts), protein bars, fresh fruits, and sodas. 'While customers may see higher prices at other retailers, we're working hard to unlock even more value for our shoppers, just in time for summer's lineup of holidays and gatherings where food takes center stage,' Hart says. Related: Trump's Tariffs May Add Nearly $5,000 to the Average Family's Annual Grocery Costs Aldi's chief commercial officer, Scott Patton, details that, 'This summer, we're going further to deliver more of what sets us apart, great products at the lowest possible prices. With price drops on the season's most-loved products in every aisle, we want to do what we can to help shoppers enjoy more of summer.' If you're wondering how Aldi can afford to give shoppers such low prices, the supermarket even includes an answer in its press release about the summer savings, emphasizing that this is 'thanks to the intentionally different way the grocer operates. From its famous quarter cart system to the decision to skip music in its stores, Aldi cuts the fluff, so shoppers don't have to cut corners.' This summer, whether you plan to sear steaks for a crowd, grab your favorite ice cream, or buy drinks for the upcoming holiday weekends and backyard barbecues, be sure to take advantage of Aldi's seasonal promotions. Read the original article on Food & Wine Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
14 hours ago
- Yahoo
Tesco to shed light on sales as ‘awful April' bill hikes squeeze budgets
Tesco shareholders will be watching closely for signs that it is managing to fend off competition as the supermarket price war heats up and 'awful April' bill hikes eat into household income. The UK's biggest supermarket chain will unveil its financial results for the first three months of its financial year on Thursday. Tesco recently signalled that a price war was mounting within the sector, saying that it expects to make as much as £400 million less in profit in the year ahead as a result of what it called 'a very competitive market'. Asda has promised its biggest price cuts in 25 years under returning boss Allan Leighton, in a bid to revive the languishing chain. The rapid growth of discounters Aldi and Lidl in the UK has also driven more competition as supermarkets move to match some of their prices to low-cost alternatives. Tesco is expecting to generate a group adjusted operating profit of between £2.7 billion and £3 billion for the year to February 2026, down from the £3.1 billion made over the latest year. A group of analysts for AJ Bell said that, despite fears of a supermarket price war, Tesco's share price was close to a 12-year high. 'Asda's reboot under new chair Allan Leighton prompted such concerns but, for now, the competition seems relatively limited in scope, with a focus on Clubcard and loyalty scheme customers and loss-leaders that drive footfall,' they said. 'Mr Leighton claims he can see the green shoots of recovery at Asda, but the latest Kantar survey of market share in the UK grocery market suggests that Tesco, Aldi and Lidl continue to have both Asda and Morrisons for breakfast.' Asda is the UK's third-largest UK supermarket, behind Sainsbury's, but remains close to being overtaken by Aldi which has seen its share of the market grow steadily. Meanwhile, investors will be looking for an update from Tesco on how consumers are faring following the onset of higher bills during what has been dubbed as 'awful April'. Household bills including for electricity, water, phone deals, and council tax rose for many from the beginning of the month. Financial markets analyst Michael Hewson said trading updates from the UK's biggest retailers can give a strong indication of consumer trends and any signs of weakness in the UK economy. He said Tesco's Booker division – the food wholesaler – was the 'main drag' on its latest annual sales figures, 'largely due to weakness in its tobacco business, as well as the fast-food market serviced by its Best Food logistics brand'. 'This business supplies the likes of Burger King, Pret a Manger, Pizza Express, Zizzi, Nando's and Pizza Hut, and saw a like-for-like sales decline of 5.1% to £1.44 billion,' he said.
Yahoo
15 hours ago
- Yahoo
WHSmith pricing 'should be illegal' after customer charged £4.19 for a Pepsi
WHSmith pricing "should be illegal", according to shocked customers. Welsh snooker legend Mark Williams recently posted a picture of a checkout screen in WHSmith, where it showed a 500ml bottle of Pepsi Max costing £4.19. Williams was at Heathrow Airport at the time. Airports across the country are slightly notorious for charging inflated prices. At the time of writing, a 500ml bottle of Pepsi Max from Tesco costs £1.59. Customers subsequently blasted the store. WHSmith pricing should be illegal in general, no clue how they get away with it — Sel (@SA1903_) June 4, 2025 One said: "WHSmith literally sold off their entire High Street business but kept travel hub shops for this very reason. It's like printing money and they don't care about the customers." Another commented: "Smiths are proper cosy cosy with all the airports, word is they mark up their prices by 50% and go halters with the airport the shops located in". Someone else replied: "I paid that in Liverpool airport a couple of weeks ago, couldn't believe my eyes". Another said: "WHSmith pricing should be illegal in general, no clue how they get away with it". Some, however, defended the pricing. Recommended reading: Jeremy Clarkson bans fan from The Farmer's Dog pub after heated argument UK government makes major driveway law change set to affect millions of homes Pest control expert issues 'incredibly sneaky' bed bug warning to all UK homes Replying to the previous post, a user commented: "It's in an airport mate". To which he responded: "Expensive in other WHSmith stores too hence why I said general". Airports tend to be expensive due to a combination of factors, including high operational costs, the captive audience they serve, and the unique challenges of operating within a confined space. These costs are then reflected in higher prices for food, beverages, retail goods, and services within the airport, as well as in airline ticket prices, which often include airport fees.
