The new boss of supermarket giant Tesco has today backed the strategy of his predecessor, despite a drop in first-half core profit as Covid-19 costs and losses at Tesco Bank outweighed a surge in sales.
Irishman Ken Murphy, who formerly worked at healthcare group Walgreens Boots Alliance, succeeded Dave Lewis as Tesco CEO on October 1.
"I think you can take it that I'm really happy with the strategy and direction of the company, unless you actually see it changing in the stores," he told reporters.
"My job is to maintain momentum in the business and keep us focused on delivering a brilliant Christmas," he said.
Ken Murphy said it was too early to talk about longer term strategic opportunities. But he said he had no plans to exit any more overseas markets or sell Tesco Bank, which swung to a first half loss as it braces for a surge in virus-related bad debts.
In his six years at the helm, Lewis put Tesco back on track after an accounting scandal and refocused the group on its home market.
Tesco still faces major challenges, most notably the economic impact of the pandemic and potential disruption when Britain's Brexit transition period finishes at the end of 2020.
Shares in Tesco went sideways during Lewis' tenure and last week the group briefly lost its position as Britain's most valuable food retailer to online specialist Ocado.
Its shares were up 2.2% today, paring 2020 losses to 14.3% after the group forecast that retail operating profit in the full 2020-21 year would be at least the same level as 2019-20 - a slight upgrade from its June forecast.
Tesco today reported group operating profit before one-off items of £1.04 billion in the 26 weeks to August 29, down from £1.23 billion the same time last year. Retail operating profit rose 4.4%.
Tesco said its UK like-for-like sales jumped 7.6% as shoppers continued to eat more at home due to coronavirus-related restrictions on socialising, having been up 8.7% in the first quarter.
However, the cost of coping with the pandemic - including extra staff - amounted to £533m.
Tesco said that like-for-like sales in its Irish operations rose by 15.5% on the back of its "out of home" consumption and high customer confidence in the company's safety measures.
It said that growth was particularly strong in its large stores and its online grocery business here..
Tesco Bank made a loss of £155m, driven by a provision for potential bad debts and reduced income. A loss of £175-200m is still expected for the full year.
The £8.2 billion sale of Tesco's Thailand and Malaysia businesses, agreed in March, is expected to complete in the second half, allowing Tesco to return £5 billion to shareholders via a special dividend.
Tesco also named Tate & Lyle's Imran Nawaz as its new finance chief. He will succeed Alan Stewart who retires in April.
The company said that an interim dividend of 3.2 pence is being paid.