Tesco, the world's number three retailer, has shown its resilience to the economic downturn, posting a 10% rise in underlying annual profit to £3.128 billion sterling - a record for a British retailer.
In Ireland, Tesco said total sales grew by 5.2% to €3.15 billion in the 53 weeks to the end of February. But this was boosted by the opening of 16 new stores, and underlying sales were down 4.2%, reflecting the slowdown in consumer spending in the final quarter of the year.
Chief executive Tony Keohane said Tesco Ireland working to get prices down to levels more in line with the lower incomes of its customers.
Tesco said there had been a steep rise in cross-border shopping into Northern Ireland encouraged by the decline in sterling in relation to the euro - which has seen an estimated 4% of the total market move over the border. But it said it was 'working to close the gap' on food prices with the North.
The company said the performance of different categories varied, with clothing sales in Ireland growing by 45%, but demand for alcoholic drinks and household products falling.
Tesco said its new distribution centre at Donabate in north County Dublin had delivered substantial efficiencies and improved stock management. The company employs 13,500 people in Ireland.
The parent group, which employs 440,000 people in about 4,000 stores across 14 countries, earlier said that its total sales rose by 15.1% to £59.4 billion in the 53 weeks to the end of February.
In today's results statement, Tesco said that it has made a good start to the new financial year with total sales up by 9.2% in the first six weeks, and 12% excluding petrol.
Analysts had expected Tesco to make a profit before tax and once of items of £3.04 billion.
Tesco CEO Terry Leahy said it was 'impossible to say' when Tesco's US business would break even, because of the economic downturn.
Tesco had planned for its US Fresh & Easy chain to break even at the end of its 2009-10 fiscal year, but said it now expected the business to make a similar trading loss to the £142m for the year just ended. Leahy said he was 'absolutely' committed to the US chain.
Meanwhile, the company - which is to create hundreds of jobs in Northern Ireland - is facing industrial action from staff at one of its busiest Cork stores in a row over changes to work practices as part of relocation to new premises.
Tesco intends to remove established terms and conditions for staff moving to a new store at the same location in Douglas. The ballot of the 85 Mandate members took place yesterday.