?Health and the environment will continue to be at the top of our agenda because they are both becoming increasingly important to our customers. On health we start the new year with our GDA nutritional labelling on more products and very soon we will have it on all Tesco products. I believe that this has been our single most important contribution to helping customers eat more healthily and it is making a real difference to their diets. The sales figures continue to show a significant shift towards healthier products across all categories as the new labelling is introduced.

Our customers have reacted enthusiastically to the environmental initiatives we launched last year whether it's reducing the number of carrier bags they use and earning green Clubcard points or recycling more at our state-of-the-art automated recycling machines. I am excited by the impacts, such initiatives can have and I am committed to encouraging and incentivising more customers to do something differently.

Consumers continue to be cautious because they have seen their household bills such as utilities and mortgage costs increase. This always poses a challenge to retailers and flushes out the best from the rest. The grocery sector is, of course, in the midst of another competition inquiry and 2007 should see it concluded. Ours has always been a competitive industry and competition is good for consumers, good for business and good for the economy. Tesco is at its best when the competition is tough so I'm looking forward to facing these new challenges.

We have some exciting plans to give our customers the best shopping trip possible, no matter how or where they shop. We will grow our Tesco Direct business offering more products and more ways to shop for them. We will continue to innovate to help our customers help the environment and get healthy, and overseas we have some strong growth plans for our existing markets and, of course, we will open our first stores in the US.

Sir Terry Leahy is chief executive of Tesco