Tesco's Fresh Food Helps Retailer Surmount Cost Pressures

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Red Peppers are seen in the fruit and vegetable aisle in a Tesco Metro store, operated by Tesco Plc, in London, U.K., on Monday, April 16, 2012. Tesco Plc, the U.K.'s largest supermarket chain, will reduce spending by more than 350 million pounds ($559 million) to ensure it can continue its dividend yield, according to JPMorgan Cazenove.Photographer: Simon Dawson

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By Sam Chambers

April 11, 2018 at 6:20 AM UTC

Updated on

April 11, 2018 at 8:38 AM UTC

This article is for subscribers only.

Tesco Plc’s fresh food and prepared dishes helped the U.K.’s biggest retailer overcome a Brexit-fueled surge in costs, as the outlook brightens for the country’s grocers.

The supermarket operator’s profit jumped in the latest financial year as it sold more ready meals from ranges like Hearty Food Co. and plant-based products from the new Wicked Kitchen line. That helped Tesco mitigate inflationary pressure stemming from the weak pound, which has prompted staff cuts and price increases by Britain’s grocers as they compete with German discounters Lidl and Aldi for market share.