Asian growth boosts Tesco profits

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Britain's biggest retailer, the supermarket chain Tesco, said on Tuesday that net profits jumped to 1.18 billion pounds in the first half on the back of strong sales growth in Asia.

"The global economic headwinds of the last two years are being replaced by the tailwinds of recovery in most of our markets and this is helping our international businesses to resume strong sales and profit momentum," said Tesco chief executive Terry Leahy.

"Our important Asian markets in particular are emerging strongly from recession and we are now benefiting from the substantial investment we continued to commit to the region during the downturn."

Leahy announced in June that he was stepping down in March 2011 after 14 years as chief executive.

Leahy, who turned Tesco from a solid British food retailer into a worldwide operation also selling electrical items, clothes and financial products, will be replaced by its head of Asian, European and IT operations Philip Clarke.

Tesco on Tuesday said that profit after tax rose 15 percent to 1.18 billion pounds (1.36 billion euros, 1.87 billion dollars) in the six months to the end of August compared with the equivalent period in 2009.

Group sales jumped 8.3 percent to 32.9 billion pounds for Tesco, which is the world's third largest retailer after number one Wal-Mart and French supermarket giant Carrefour.

Tesco on Tuesday added that profits before tax and exceptional items rose 14 percent to 1.79 billion pounds, which beat analyst expectations for underlying earnings of 1.7 billion pounds.

© 2010 AFP

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