Tesco has posted a record loss of £6.4bn, one of the biggest losses outside of banking in British corporate history.
In its annual results, published today, the supermarket group revealed it made a pre-tax loss of £6.38bn in the year to the end of February, compared with a pre-tax profit of £2.3bn the previous year.
The loss has been driven by £7bn in one-off charges, which the company says reflects “challenging industry conditions and profit decline”.
Tesco has also agreed a plan to fund its £3.9bn pension deficit with cash contributions of £270m a year. In January it confirmed plans to close its defined benefit pension scheme as part of a drive to cut annual costs by up to £250m.
Tesco chief executive Dave Lewis says: “It has been a very difficult year for Tesco. The results we have published today reflect a deterioration in the market and, more significantly, an erosion of our competitiveness over recent years. We have faced into this reality, sought to draw a line under the past and begun to rebuild, and already we are beginning to see early encouraging signs from what we’ve done so far.”
It emerged last year that the FCA was investigating Tesco after the supermarket revealed it had overstated its half-year profit forecast by £250m.