Tesco Ireland posts €120m operating profit in first ever publishing of statutory accounts
Currently, Tesco sits in joint first position in market share, comprising almost 23% of the Irish grocery sector.
Tesco's Irish arm posted an operating profit of €120.35m in 2023 on the back of several price hikes amid sustained high inflation.
Publishing its statutory accounts for the first time for its Irish operations, Tesco Ireland saw after-tax profit fall to €85.53m in 2023, down from €104.95m in the previous year.
The group's retail sales turnover reached €2.98bn in the 12 months ending in February 2023, up 4.8% on the previous period.
Posting a 14% decline in operating profit, Tesco said this reflected its "level of investment in its customer offer and for colleagues", with a Save to Invest programme largely offsetting significant operating cost inflation.
Posting the decline, the retailer noted higher energy costs, inflation-led price increases, and rising property impairment charges as a result of changing macroeconomic assumptions.
Tesco Ireland chief executive Natasha Adams said: "Earlier this year, we made the decision to begin publishing our statutory accounts for Tesco Ireland to address transparency in our business, and demonstrate the significant contribution that Tesco makes to the Irish economy.
"Tesco, as a group, is the single, largest purchaser of Irish food and drink in the world, buying €1.6bn a year; more than any other single country in the European Union. We are publishing to demonstrate our commitment to the role we play in supporting the Irish economy."
Currently, Tesco sits in in joint first position in market share, comprising almost 23% of the Irish grocery sector.
Overall, Tesco Ireland's operating profit margin was 4% for the year, down from 4.9% in the previous period. The group also paid €23.5m in corporation tax in the year.
Employing almost 13,000 people nationwide, the company's profit follows more than a year of rising price levels which has put increased pressure on Irish consumers.
In the 12 months, food retailers across Ireland have come under extensive criticism by the Government for their prices, prompting Minister of State at the Department of Enterprise, Trade and Employment Neale Richmond to call an emergency meeting earlier this year with retailers to address soaring food and grocery costs.
While many have cut their prices in response to sustained criticism, latest figures from the CSO show food prices remain around 8% higher on an annual basis, with all staple household groceries increasing in price over the past year.
Publishing its annual report in June this year, Tesco plc reported growth of almost 4% rise in Irish sales, but did not at the time publish profits across its Irish arm.
Combining both its UK and Irish markets, Tesco posted an operating profit of just under £2.3bn (€2.7bn) for its 2022/23 year, with the company noting that the Republic of Ireland "consistently outperforms" the wider market.
Speaking at the time, chief executive Ken Murphy, from Cork, said the company was conscious of its many customers facing significant cost-of-living pressures, but added that there were "encouraging signs that inflation is starting to ease across the market".
At the time, Mr Murphy pushed back at suggestions of profiteering following its annual results for 2022/23, which also showed its pre-tax profits dropped by over 50% to £1bn (€1.14bn).
Across its Irish arm, Tesco's clothing business also saw a surge in growth, with sales rising by almost 13%, with non-food like-for-like growth exceeding 5%.
The retailer's loyalty scheme — which offers heavily discounted prices on grocery products — has seen significant uptake in the past year. In its annual report, the retailer said Tesco Clubcard penetration reached 77% in the Republic of Ireland with 700,000 Irish users.
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