Tesco CEO Ken Murphy has issued a commitment that the business will do all it can to minimise the impact of the conflict in the Middle East on its customers.
Speaking today as the UK’s biggest retailer published its full-year results for the year 22 February, Murphy also questioned a warning issued by the Food & Drink Federation last month that food inflation would reach more than 9% by the end of the year due to the impact of the conflict,
“In terms of inflation, we are not seeing any meaningful inflation coming through, with the obvious exception of the cost prices we’ve seen on fuel,” Murphy said. “We don’t recognise the number that was published.”
Murphy was at pains to point out the situation in terms of availability and pricing remained unpredictable but that currently Tesco suppliers were not flagging any issues.
“This scenario seems to change literally by the hour, depending on the latest social media post from the American president,” he added.
“I’m giving a commitment that Tesco will do its very, very best to minimise the impact on customers. I think that we’ve demonstrated that commitment over the last five years, and we’ve had a number of different crises, whether it be Covid, supply chain crisis, cost of living crisis, and Tesco has responded incredibly quickly to that. So I think if you’re looking for reassurance, are we doing everything in our power to minimise and mitigate any potential impact? The answer is yes. Can I provide guarantees? Of course not.”
Murphy added that Tesco would continue to work closely with its suppliers and the government to manage any issues.
“What we do with suppliers is we keep in touch with them constantly. Our fresh food supplier base, which would be the most impacted. We operate an open book system where we transparently look at their costs. It’s an ongoing watching brief effectively, and we work very closely with them also in terms of improving efficiencies and helping them, and also drive down costs to hold back inflation from our customers.
“That’s something that’s worked very well for us for a number of years now.”
The supermarket exceeded its own expectations in the financial year, beating profit targets and posting 4.6% revenue growth, with UK like-for-like sales up 4.2%. Sales excluding fuel reached £66.6bn, adjusted to a 52-week basis to 22 February 2026.
Tesco’s adjusted operating profit nudged up to £3.15bn, outperforming its own estimates of £2.9bn-£3.1bn after a strong showing over Christmas.
Tesco’s market share was up 24bps in the year to 28.5%, having reached a decade peak in December.
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