Supermarket powerhouse Tesco, today unveiled plans to rake in as much as £5 billion from property sales over the next five years as it notched up record profits of more than £2.2 billion, the biggest ever made by a British retailer.
The group said it plans to release equity from the portfolio through a sequence of joint venture deals, both in the UK and internationally. “The total scale of this sale and leaseback programme in terms of cash proceeds over the next five years is expected to be up to £5bn.”
Tesco said, “At least £1.5bn of these proceeds will be used to buy Tesco shares in the market. The balance will be used to enhance shareholder value, either through the funding of future growth, or by further return of capital.”
The group reported an 18 per cent rise in pre-tax profit to £2.24bn from £1.89bn a year earlier, on sales up 16.7per cent to £43.1bn last time.
Tesco saw strong sales both in the UK and abroad, with UK sales rising 10.7per cent and foreign sales increasing by 23 per cent.
“These results represent good progress across the group in a more challenging year. By investing to improve the shopping experience for customers in our businesses around the world, we have been able to deliver another strong sales performance,” Chief Executive Terry Leahy said.
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