Corkman Ken Murphy named next Tesco group CEO

British supermarket giant Tesco has named Cork-born businessman Ken Murphy as its next group chief executive.

Mr Murphy, a former joint chief operating officer at Boots UK and Ireland before becoming chief of global brands for parent group Walgreens Boots Alliance, will take over the day-to-day running of Tesco next summer.

Tesco said sales in its Irish operations grew by 0.5% - to £1.14bn (€1.28bn) - in the first half of its current financial year.

It said Irish sales were mainly driven by growth in core fresh food products - bakery and produce, in the main - with customers responding well to its price promotion campaigns.

"Our total sales performance [in the Republic] includes a new store contribution of 0.5%, principally relating to the opening of Liffey Valley Extra [store] in May last year," Tesco said.

Recent industry figures showed Tesco commanding a co-leading 21.4% share of the Irish grocery sector.

On a group-wide basis Tesco beat forecasts with a 25% rise in first-half operating profit, before one-off items, to £1.4bn and a hike in its interim dividend of 58.7%.

It generated group sales of £28.3bn for the six months to the end of August - 0.1% up on a year-on-year basis.

Overshadowing the figures to some degree, however, was the announcement that group boss Dave Lewis will step down next summer after declaring the turnaround of Britain’s biggest retailer complete, handing over to Mr Murphy.

Tesco is five years into a recovery plan that Mr Lewis launched after a 2014 accounting scandal capped a dramatic downturn in trading.

Mr Murphy will become the second outsider to lead Tesco, following in the footsteps of former Unilever executive Mr Lewis.

And like Mr Lewis, he also has experience in the consumer goods industry - key suppliers to supermarkets - having started his career at Procter & Gamble.

“Now is the right time for me to pass on the baton, our turnaround is complete,” Mr Lewis said.

“We’ve delivered all the metrics we set for ourselves, the leadership team is very strong, our strategy is clear and it is delivering,” he said, adding he was not leaving for another job.

Tesco chairman John Allan said Mr Lewis had indicated to him a year ago of his plan for a 2020 departure, kicking off a succession process that also considered internal candidates.

Mr Murphy will be paid a yearly wage of £1.35m, with a pension contribution of 7.5% of basic salary.

-Additional reporting Reuters