Corkman Murphy takes over as Tesco CEO at challenging time

He faces the long-term impact of coronavirus crisis, a recession, and possible Brexit disruption

Corkman Ken Murphy takes over tomorrow as new Tesco chief executive.

Cork-born businessman Ken Murphy officially takes over as Tesco group chief executive tomorrow, succeeding former boss Dave Lewis.

Mr Murphy was announced as Tesco’s new boss last year, but formally joins when the supermarket giant is facing huge challenges.

Mr Murphy, who was previously at healthcare group Walgreens Boots Alliance, faces the long-term impact of the coronavirus crisis, a recession, and possible disruption when Britain's Brexit transition period finishes at the end of 2020.

He starts as Britain’s supermarkets have seen grocery sales boosted by the pandemic, both in stores and online, but have also seen a big increase in costs.

There are also fears that the pandemic-induced recession will spark a margin damaging price war.

Mr Murphy will have to decide the future of Tesco’s central European division, with stores in the Czech Republic, Hungary, and Slovakia, its only remaining overseas supermarket operations apart from Ireland.

A week after Murphy starts, analysts expect Tesco to report second-quarter UK like-for-like sales growth similar to the first- quarter’s 8.7% but anticipate increased costs will drag down core earnings.

Tesco was on its knees shortly after former chief executive Mr Lewis joined in 2014 when an accounting scandal knocked millions off its profits and billions off its share price.

But by October last year, Mr Lewis declared Tesco’s turnaround complete, and its position as the clear market leader in the UK reinforced.

— additional reporting Reuters