Tesco reported record profit this week of £2.2bn, but its growth in recent months slowed to its lowest in four years.

Tesco chief Sir Terry Leahy admitted that it was now growing slower than some of its competitors, following Sainsbury's fourth-quarter results in March, when it announced higher like-for-like sales of 5.3% for the same period (The Grocer, April 1, p9).

However, Sir Terry said that its figures were off far tougher comparables.

Analysts said the results held no big surprises, despite the slowdown. "We believe Tesco's business model is robust and will prove a long-term winner," said an analyst at Citigroup. However, he added that he was "more concerned than most about the deteriorating price environment" in the UK. "We expect Tesco's lack of public concern masks some serious behind-the-scenes activity."

Sir Terry pledged not to squeeze suppliers for increased volume rebates. "We always work closely with suppliers and we plan long term for them to grow with the business."

Ahead of the OFT's decision on whether to refer the grocery industry to the Competition Commission, Tesco said it had submitted evidence on April 6.

But Sir Terry said he did not believe that a different conclusion would be drawn from the previous two inquiries or that it would be forced to sell any landbank sites. "We only have sites with the intention of opening up supermarkets."