Slide 1: Tesco Preliminary results 2024/25
Tesco Preliminary results 2024/25. Ken Murphy, Chief Executive Officer Imran Nawaz, Chief Financial Officer 10 April 2025
Slide 2: Agenda
Agenda. 01. Introduction 02. Preliminary results 03. Strategic progress 04. Q&A 2
Slide 3: Introduction
Introduction
Slide 4: Further improving customer satisfaction
Further improving customer satisfaction. Progress across all measures of brand perception1 Brand perception growing ahead of market average2 +282bps +242bps +251bps +153bps +113bps +68bps Impression Quality Value Reputation Satisfaction Recommend Feb 21 Feb 25 Tesco Competitor Average Tesco Competit
Slide 5: Winning market share in UK and ROI
Winning market share in UK and ROI. UK share gains Highest UK share since 2016 ROI share gains UK Market Share YoY1 Historical UK Market Share (%)2 ROI Market Share YoY1 30 +67bps +75bps +64bps +47bps 28 +37bps +37bps +29bps +25bps 2023 26 2022 2021 2022 2024 2025 2021 2023 2024 2025 (3)bps (29)bps
Slide 6: Taking share from across the market
Taking share from across the market. Broad-based market share gains, supported by: Net switching gains in FY 24/251 • Our powerful value proposition: Total net switching gains £496m £300m £274m £191m £200m • Launching >1,000 new products and improving >600 • Market-leading availability2 £100m • Chea
Slide 7: Supporting our colleagues
Supporting our colleagues. Further colleague satisfaction improvement; 85% recommend as ‘a great place to work’1 5.2% rise in UK store colleague pay by end of August 2025 Over 21,000 colleagues now registered for our new virtual GP service Recognised as ‘Retailer Employer of the Year’ at the Grocer
Slide 8: Partnering with our suppliers
Partnering with our suppliers. Further increase in supplier satisfaction, highlighting strong relationships1 Extended the Tesco Sustainable Pig Group, one of six sustainable farming groups Working together to improve supply chain resilience and sustainability Ranked 1st in the Advantage supplier sur
Slide 9: Strong financial performance
Strong financial performance. +4% Group sales1 +11% Group adjusted operating profit2 £1.75bn Free cash flow Dividend and buybacks in £1.9bn last 12 months3 1. Group sales at constant rates of exchange and excludes VAT and Fuel. 9 2. At constant rates of exchange. 3. Share buybacks and ordinary divid
Slide 10: Well placed to keep winning for customers
Well placed to keep winning for customers. FY 25/26 Guidance1 Robust balance sheet and a well-invested business Group adjusted operating profit of £2.7bn to £3.0bn Positive momentum as we start the year Free cash flow within our mid-term guidance range of £1.4bn to £1.8bn £1.45bn share buyback to be
Slide 11: Creating sustainable value
Creating sustainable Improved customer satisfaction supporting volume value. growth and market share gains Strong financial performance, robust balance sheet and positive momentum Flexibility and firepower to continue winning in a highly competitive market 11
Slide 12: Imran Nawaz
Imran Nawaz
Slide 13: Performance headlines
Performance headlines. 1 On a continuing operations basis Group sales Profit 2 3 Growing sales volumes, with further market share gains in the UK and Ireland +4.0% £3,128m Profit growth from stronger volumes and Save to Invest Like-for-like +3.1% +10.9% vs. last year delivery Free cash flow Net debt
Slide 14: Segmental performance
Segmental performance. On a continuing operations basis1, where the Insurance and Money Services business has been presented within headline performance measures Change at Adjusted Change at Sales 2 constant LFL operating constant Margin4 Rates Profit3 Rates UK & ROI £59,450m 4.2% 3.1% £3,016m 10.3%
Slide 15: UK & ROI: UK
UK & ROI UK. LFL sales +4.0%; strong volume growth LFL – Food/Non-Food View LFL – Channel View throughout the year; market share gains +67bps1 Food +4.9%; investments in value and quality +4.9% delivering volume growth ahead of the market +3.2% excluding toys Large 4.1% +3.2% Clothing +3.0%; strong
Slide 16: UK - Online
UK & ROI UK - Online. Sales growth1 +10.2%; includes a c.3ppts contribution Total Online1 24/25 YoY change from Tesco Whoosh Sales inc. VAT £6.8bn 10.2% Improving customer satisfaction metrics Orders per week 1.3m 10.8% Basket size1 £109 3.6% Tesco Whoosh now in over 1,500 stores, including launch i
Slide 17: ROI
UK & ROI ROI. LFL – Food/Non-Food View Sales Growth2 LFL sales +4.6%, driven by strong volumes; +4.0% excluding toys market share gains +29bps1 +5.0% +1.0% +5.6% Food sales +5.0%, supported by ongoing +4.0% +4.6% investments in our fresh proposition Home & Clothing +0.9%, reflects transition to a co
Slide 18: Booker
UK & ROI Booker. Core Retail +0.9%; symbol brands1 continue to Sales LFL perform well, whilst challenges in independent convenience sector continue Core Retail £3,234m 0.9% Core Catering +2.1%; supported by volume growth Core Catering2 £2,621m 2.1% as customers responded well to our value investment
Slide 19: Central Europe
Central Europe. LFL – Food/Non-Food View LFL - Channel View LFL sales +2.2%, driven by improved category mix +5.3% and volume growth Food sales up +2.4%; volume-driven, due to positive response to value & range investments +2.4% Growth across all channels, with particularly strong +0.9% growth in Su
Slide 20: Group operating profit
Group operating profit. On a continuing operations basis1 • UK & ROI UK & ROI CE Group • Strong volume growth in UK and ROI, partially offset 2 by Booker trading challenges Operating profit £3,016m £112m £3,128m • Ongoing Save to Invest delivery, more than offsetting net operating cost inflation Ope
Slide 21: Statutory profit after tax
Statutory profit after tax. On a continuing operations basis1 • £(417)m of adjusting items reflects: 24/25 23/24 YoY £m £m £m • Non-cash net impairment charge of £(286)m, due primarily to increase in discount rates Adjusted operating profit 3,128 2,829 299 • Amortisation of acquired intangibles of £
Slide 22: Free cash flow
Free cash flow. 24/25 23/24 • Working capital outflow of £(45)m reflects lower trade £m £m balances in fuel, driven by price deflation. Prior year inflow driven by elevated input cost inflation Cash generated pre-working capital 4,692 4,415 • Capex spend of £1.4bn, prioritising high returning (Incre
Slide 23: Balance sheet metrics
Balance sheet metrics. 1,2 3 Net debt Fixed charge cover 2.0x 2.2x 4.2x 3.8x Balance sheet remains strong with net debt2 £1,136m £1,182m ratio of 2.0x £9.5bn £9.7bn £159m £185m Fixed charge cover improved to 4.2x reflecting £7.7bn £7.6bn strong EBITDA growth £977m £997m £1.7bn £2.1bn FY 24/25 FY 23/
Slide 24: Return on capital employed
Return on capital employed. 1,2 ROCE 14.6% Continued investment in our estate; 13.4% 90 new stores & 463 stores refreshed 12.1% 11.8% Investing in automation; new robotic automation 8.7% at our existing Peterborough DC and Aylesford fresh food DC opening summer 2025 FY24/25 WACC3 Developing AI techn
Slide 25: Strategic progress
Ic Sstrateg
Slide 26: Multi-year performance framework
Multi-year performance framework. • Increasing customer satisfaction relative to the market Drive top-line growth • Growing or at least maintaining our core UK market share Generate £1.4bn to £1.8bn free cash flow per year • Leveraging our assets efficiently across Grow absolute all channels profits
Slide 27: Progress against the framework
Progress against the framework. Customer satisfaction1 UK market share2 Top line growth +470bps +121bps +4.5% CAGR Drive top-line growth £9.6bn cumulative free cash Aug. 21 Feb. 25 Aug. 21 Feb. 25 Feb 21 Feb. 25 flow since FY20/21 Retail adj. operating profit3 New profit opportunities Save to invest
Slide 28: Our strategic priorities
Our strategic priorities. Magnetic I love my Easily the Save to value for Tesco most Invest customers Clubcard convenient Re-defining value to become Creating a competitive Serving customers wherever, Simplify, become more the customer’s favourite advantage through powerful whenever and however they
Slide 29: Magnetic value
Magnetic value. >600 everyday >1,000 Low c.8,000 Clubcard essentials price Everyday Prices Prices offered matched to Aldi locked until Easter each week Further improvements in price position against the market since January 2025 Customers could save up to £392 a year with Clubcard Prices1 Exclusive
Slide 30: Leading on value
Leading on value. CORN FLAKES, [cnuacur s cusy We've not just cut prices. We've not just cut prices. We've slashed them. F ‘ We've slashed them. We’ve not just cut prices. We've slashed them. TESCO a septa ane esa isetomtescemime sone sarong Egy Uiatle dalps Teiostravoores oo 8.25/
Slide 31: Investing in quality across our ranges
Investing in quality across our ranges. 400 new Tesco Finest products in UK, Taste Discoveries range, inspired by Health-led High Protein including Finest Steakhouse range; Japanese and Korean cuisine and Gut Sense ranges expansion of Finest in Central Europe 31
Slide 32: Investing in our stores
Investing in our stores. Continuously enhancing our customers’ experience in store Fresh together Showcasing product quality and innovation Energy efficient refrigeration 32 Photos from Cheshunt Tesco Extra, UK, March 2025.
Slide 33: I love my Tesco Clubcard even more
I love my Tesco Clubcard even more. Celebrating 30 Years of Clubcard Trial of Your Clubcard Prices, Clubcard Challenges offered to 10m with exclusive Reward Partner with customers receiving weekly customers, awarding up to offers and competitions offers personalised to them £50 worth of Clubcard Poi
Slide 34: Enhanced retail media offer
Enhanced retail ‘Celebrate the Season’ multi-channel campaign with Coca-Cola media offer. Over 9,000 campaigns delivered across the year Growth in active advertisers and spend per campaign Launched store wrapping at scale and video ads at Tesco.com Over 5,000 digital screens across stores Recognised
Slide 35: Easily the most convenient
Easily the most convenient. In-store Online • Opened 90 new stores across the Group • 2.4m active customers of grocery home • >1,500 stores offering Tesco Whoosh • Further 463 stores refreshed shopping service • Tesco Marketplace: >400k products across • 770k Delivery Saver subscribers; +9% YoY home
Slide 36: Booker winning in a challenging market
Booker winning in a challenging market. c.98% Availability, improved YoY1 Venus integration and capacity expansion enhancing on-trade offer Winner of ‘Symbol / Franchise Retailer of the Year’ for a third year Launch of Scoot rapid-delivery service for retail partners 36 1. Booker availability is an
Slide 37: Supporting our communities
Supporting our communities. Stronger Starts funding of £13m for over 12,000 projects in UK Launched Fruit & Veg for Schools campaign, benefiting 400 UK schools 80 schools added to Stronger Starts Food Programme in ROI, bringing total to c.240 Over 300m meals donated to charities and local communitie
Slide 38: Caring for our planet
Caring for our planet. On track to achieve target of 65% healthy food sales Launched two low Reduced Scope 1 & 2 by Dec 20252 carbon concept emissions by 65%1, farms, trialling exceeding our 60% innovation in our target by Dec 2025 supply chain 38 1. Versus 2015/16 baseline. 2. Sales by volume In th
Slide 39: Well placed to keep winning for customers
Well placed to Improved customer satisfaction driving volume growth and market share gains keep winning for customers. Strong financial performance; Group adjusted operating profit up 11%, free cash flow of £1.75bn Significant progress in long-term growth opportunities and enhancing digital capabili
Slide 40: Appendix
Slide 41: Guidance
Guidance. Group profit Adjusted operating profit of between £2.7bn and £3.0bn Free cash flow Within our medium-term guidance range of £1.4bn to £1.8bn Capex Expect similar level of capital investment in FY 25/26 (FY 24/25: £1.46bn) Net finance costs1 Broadly in line with last year (FY 24/25: £(536)m
Slide 42: Debt and liquidity
Debt and liquidity. Debt maturity profile Smooth debt maturity profile • Less than £1bn maturing in any one year £bn Debt Maturities Sustainability-Linked Bond 1.50 • Weighted average maturity of c.6 years 1.25 1.00 Weighted average interest cost of <5% 0.75 0.50 0.25 Strong liquidity position 0.00
Slide 43: Adjusting items – FY 24/25
Adjusting items – FY 24/25. FY 24/25 FY 23/24 £m £m Net impairment (charge) / release on non-current assets (286) 28 Amortisation of acquired intangible assets (76) (74) Save to Invest restructuring provisions (43) (50) Property transactions 2 75 Other1 (14) 13 Total adjusting items in statutory ope
Slide 44: Disclaimer
Disclaimer. Certain statements made in this document are forward-looking statements. For example, statements regarding future financial performance, market trends and our product pipeline are forward-looking statements. Phrases such as "aim", "plan", "intend", “should”, "anticipate", "well-placed",