Good morning everyone, and thank you for joining Imran and I following the publication of our first quarter trading update earlier today. We've made a good start to the year.

I'm particularly pleased with our strong customer satisfaction scores, helping to drive further sales growth on top of the exceptional performance we delivered last year. Alongside ongoing investments in value, quality, and service, we are making strong progress against the longer-term growth drivers we set out in April, including personalization, retail media, and digital capability.

As we build on the unique strengths of our business, we are unlocking sustained long-term growth for all our stakeholders. I'd like to say a big thank you to all our colleagues for their continued hard work and commitment.

Their focus on delivering consistently great service has once again been key to our performance. Before opening the call to your questions, I would like to take a few moments to run through some of the highlights of the quarter.

Like-for-like sales in the UK grew by 1.8% against a particularly strong comparative period last year, which benefited from record-breaking weather and disruption at some of our competitors. This was also reflected in market share, where we broadly held our own across the quarter and saw a small decline in the latest four-week read as we started to lap the strong comparative.

Fresh food led the performance, with like-for-like sales growth of 3.6%. Finest also remained strong, with sales up 9%.

Online continues to grow strongly, with sales up 8.9%, including another strong contribution from Whoosh, where sales grew by over 30%. Alongside a further expansion of Whoosh's to more households, we also rolled out a book-for-later option, giving customers more choice and flexibility for same-day delivery.

Food innovation remains an important driver of our success, and during the period we launched over 500 new and improved products, including more than 200 in Finest. Our progress on quality was also recognized externally, including two Good Housekeeping Retailer of the Year awards.

With the conflict in the Middle East contributing to uncertainty for many households, we have continued to invest in the parts of the shopping trip that matter most to our customers. During the quarter, that included extending Aldi Price Match to more than 2,000 Express stores.

Alongside thousands of Clubcard deals, our extended Everyday Low Price program, and our ongoing investments into great quality and service, we're committed to giving customers the very best value for money however and wherever they shop with us. We are also committed to supporting the communities we serve.

During the quarter, we announced plans to double the size of our free Fruit & Veg for Schools program, reaching more than 1,000 schools every week from September. In Ireland, we have again delivered strong volume-led growth across all channels.

Like-for-like sales increased by 3.3%, with particularly strong online performance. New store openings are also making an important contribution to growth in Ireland, with a total sales growth of over 5.6%.

Booker's performance across retail and catering reflects both a strong prior-year comparative, which benefited from favorable weather, and the impact of exiting a lower-margin retail contract in the second half of the year. Underlying growth across retail and catering remains solid on a two-year basis, with customer satisfaction scores making further progress.

During the period, we also added a further 146 retail partners. In Central Europe, we delivered modest growth, supported by volume gains and an improved mix in food.

Online performed especially well during the period, and we are pleased to see a significant improvement in consumer confidence in Hungary. Alongside good short-term progress, we are also making strong progress against our longer-term strategic ambitions.

For instance, our new Adobe-powered personalized communications platform has now gone live, step-changing our capability to give customers more relevant inspiration, offers, and reminders. We were really excited to give all of our colleagues exclusive access to our AI meal planning assistant as we fine-tune it ahead of a broader rollout to customers later this year.

As we start a summer of major sporting events, including the football World Cup, we are seeing strong engagement from our suppliers as they look to connect with customers. That includes product exclusives from brands such as Budweiser, Walkers, and Pepsi.

Alongside innovative retail media activity, the World Cup is a clear example of how we are creating engagement moments for brands and customers. We're already seeing customers get into the World Cup spirit.

On Saturday, sales of Irn-Bru were up 50% ahead of the Scotland game, and cocktail cans were up 185%. Last night, we also extended our Whoosh operating hours until 11:00 PM so that England fans could get drinks and snacks straight to the door without missing a minute of the game, and Whoosh sales yesterday were up around 40%.

In summary, I'm pleased with the start we've made to the year. As customers remain mindful of their spending against a backdrop of continued uncertainty, we are committed to doing whatever we can to deliver the very best combination of price, quality, and service.

For the full year, we continue to expect group adjusted operating profit of between £3 billion and £3.3 billion, and free cash flow within our medium-term guidance range of £1.5 billion to £2 billion. Thank you for listening.

I'll now hand back to the operator, and Imran and I would be delighted to take your questions.

Hi. Good morning, Ken and Imran.

Thanks for taking the questions. Can I have three, please, if you don't mind, right at the top of the queue?

Hopefully that's okay. First one is, is there anything you can help us in terms of shape of trading, particularly towards the end of Q1 and as you entered Q2?

I know it's only a few weeks into Q2, so that will be very helpful. Secondly, I think in the outlook statement you referred to a good start to the year as you reiterated the operating profit and free cash flow outlook, as you just did there, Ken.

Does that good start mean profit growth in Q1? Is that how we should see it?

Last one, you've referred to a couple of interesting areas in the release, 15% growth in insurance policies and strong growth in retail media. Again, how should we think about contribution of these to growth of group operating profit this year?

I know it's a trading statement, but it'll be helpful for us to understand how we should think about those sorts of numbers you referred to. Thank you.

Thanks very much, Sreedhar. I will take the shape of trade and retail media and insurance question, I'll pass the profit question on to Imran.

I think it's fair to say that we are where we expected to be, Sreedhar. We are lapping exceptional weather last year, and of course we had disruption amongst our competitor set, which really influenced the base that we're lapping.

I would just say from a shape of trade point of view, we are where we are and where we expected to be. I would say that we have invested very heavily in value, and our price index is as strong as they've ever been.

As you can see from the release, we've also invested in product quality and innovation, with over 500 products released. We've extended the Aldi Price Match into our convenience stores, which we think was a really positively received move.

All of that has culminated in a record customer satisfaction score with an NPS of 31. Then as you say, what that's done is that the halo from that has meant that we're starting to see increasing traction with that ecosystem model of trading more people into our financial services products, increasing penetration of our Tesco Mobile offering, and winning with suppliers in terms of our retail media proposition, and we won another retail media award during the quarter.

All in all, we feel like the strategy we laid out for you in April is starting to show real signs of traction. I think it would help us if we could get some sunshine.

It's fair to say. Weather-related sales, things like clothing, fresh food, beer, wine, spirits, have definitely been impacted by the weather.

Other than that, I think the shape of trade is reasonably solid and consistent. I'll pass you over to Imran then.

Maybe if I give just one more comment on the shape of trade. In April we did very clearly mention there's going to be a first-half, second-half play in the sense that we knew we would lap a very strong sort of weather tailwind that we had.

You remember the 22 weeks of continuous sunshine was a thing, and clearly some disruption at our competitors also benefiting us, clearly that straddled Q1, Q2. I wouldn't want to get into a month-by-month play here, but clearly it's something that we factored into the shape of our planning.

Also maybe worth to say here as well, we are also very, very clear that, as Sreedhar, we are quite disciplined and we never go and buy sort of any empty share just because of the difficult lap. I think we continue to be very happy with how we're trading and the way that Ken described it is how we continue to operate.

Then in terms of outlook, on profit, look, I feel really good about where we are at the end of quarter one. Pretty much played out exactly as we anticipated.

You look at the online, you look at Finest, you look at Whoosh, you look at the strategic initiatives, all contributing as we anticipated. The shape of the sales growth exactly where we expected it to be, and frankly, that's also true for profit and cash.

Now, obviously there's nine months to go, still to play out, but at this stage, really happy with where we landed. Then this last question that you had, the contribution of profit drivers from media income, from IFS, from mobile, of course, they're all very helpful.

It's part of the strategy. They bring in new customers, but they also bring in new profit, and those are very helpful, as you have seen us perform over the last five years.

They have been contributing and they continue to do so in a nice way.

Imran, just really very, very quick follow-up. The level of growth we've seen in Q1, potentially Q2 as you point to H1, H2 there, is it enough to drive profit growth?

Look, every year we set out to drive profit growth, and we said the same as we started into this year, right? As you remember, the range we set out was clearly to give us the space should consumer behaviors change, driven by the uncertainty in the Iran conflict.

We haven't seen that yet, I would say one quarter in, I feel good about how we are trading and how profit is shaping up, but there's nine months to go. To your specific question, can you grow profits with the current shape of trade?

Yes.

Thank you very much. Thank you both.

Thanks, Sreedhar.

Good morning. Thank you for taking my question, and actually well done on growing sales against what you were facing into.

I just have one question. Last week the UK medical authorities approved a tablet form of diet suppressant drug.

I just wonder if this is starting to lap on your shores in terms of demand and volume, but also whether you see this development as a positive feature and prospect for Tesco going forward. Thank you very much.

Thank you, Clive. Good to talk to you, as always.

We actually see it as a positive thing. Anything that improves the health of the nation, we think is a good thing.

As you can see from the last three years, the tip of the spear for us has been our fresh food sales growth. We've been really pleased with the consistent quality improvement in our base fresh fruit, vegetables, meat, fish, poultry, and the innovation that we've brought to that area.

That's been a real positive for us. I think also we are one of the few grocers that have retained our pharmacy network, and we're the largest pharmacy chain, therefore we're doubling down on helping customers with their healthcare needs, with their broader healthcare needs, of which a weight-loss service is part of that.

Then finally, I would say it's really informed our food innovation program. We've released a number of high-protein, high-fiber product ranges, which actually play to a much broader interest customers have in healthcare that goes well beyond GLP-1.

Even before GLP-1 became a thing, I think largely through COVID we saw a big trend of customers wanting to live better lives, healthier lives, eat better, and that trend has continued and grown, and I think GLP-1 is a subset of that. We're adapting our business model to take advantage of it.

Yeah.

Ken, just by way of a follow-up, would you expect volume to reflect these trends, but mix to mean you're one-nil up?

I think so. I think that's probably the right way to look at it, absolutely.

I hope your good lady takes down those Harry Kane posters in your house quite soon, and enjoy the World Cup.

Clive, I promise you, in the long list of good-looking sports stars that she has on her wall, Harry Kane didn't quite make the cut.

Brian O'Driscoll's a bad man, isn't he?

No, Dan Carter and Roger Federer. They're the two that make the cut.

Very good, Ken. Thank you.

Thanks for answering. See you.

Bye.

Hello. Good morning.

I've got a couple of questions. The first one is on market share dynamics which you saw during the quarter.

I suppose that the temporary impact from lapping the competitor disruption from last year would have been in your budget and quite well known in advance. Could you maybe comment on your market share excluding those temporary impacts and what momentum you are seeing in your business outside of that?

Then as a sub-question on market share, could you also comment on the trend you're seeing in the Finest sales just because those have slowed down a little bit versus the mid-teens number we're used to seeing. I'm wondering, is that something that is market-wide and you're still gaining share in Finest, or has there been any change there?

Then my final questions is just the shape of the buy. As we think towards the two Qs, I guess there may be a little bit more disinflation to come and some continued month or so on the competitor disruptions based on Kantar.

Is it likely 2Q will be the lowest point of the year, or do you think the volume boost from weather and maybe the World Cup will be enough to offset that?

Let me talk on our planning assumptions. When we plan the year, you're absolutely right.

We took into account the fact that we have not just the weather tailwind, but also the disruption tailwind, and as I mentioned, that straddled Q1, Q2. Absolutely, when you think about the market share reads, we saw the beginning what I would call a period of exceptional gains, and the last month you saw that weakening in the four-week read.

That was exactly that. That still continues in my view a little bit, that big hill to climb, but it's part of the plan, it's part of how we forecasted, which is why when I look at our overall financial metrics, but also the KPIs around all the metrics that we are looking at, whether that's how online, Whoosh, fresh, food, non-food all grew is pretty much in line with expectations.

I think we're in a good place there. When I look at the rest of the business in terms of excluding those impacts, look, it's playing out exactly as we anticipated, right?

The good news is inflation is a little bit lower as you've seen. The market is calling, what was the market, around 3.5%, we're meaningfully below that.

Actually when I look at our volume performance, Izabel, in both fresh especially, it's actually quite strong, and between fresh and packaged equally, we're in a good place as in broadly slightly ahead, in fact, which is a good thing. We have been impacted, which is maybe worthy of your question to note down, is last year in Q1 we had clothing growth of around 10.5%, 11%, clearly as you lap Q1, Q2 because of that weather, that's in slight negative, but as anticipated.

All in all, trading is fully in line with our expectations. Then Q2, as you would rightly expect, weather will play a big role because you've seen outside, we've had one nice week in May, which was very, very helpful, and we saw really trade do really well during that period, which is a good sign.

Clearly, when you have sunshine, people spend more and enjoy themselves more, and I'm hoping for a longer stay for England and Scotland in the tournament. That is always helpful because I think it also lifts the mood.

When we look at our plans, our propositions, they're resonating well, they're delivering in line with expectations, but we could use a bit of help from the sun.

Izabel, just to address your second two questions, look, I'm feeling really good about Finest sales because the 9% was building on particularly strong sales the year before. I think our two-year number is kind of mid-20s in terms of the growth, so that represents an exceptional performance in Finest, and it continues to resonate really well.

Of the 500 products that we innovated around in the first quarter, over 200 of them, 220 to be precise, were Finest, including a lot of kind of ready-to-drink cocktails, which saw particularly strong growth in Scotland last Friday. In terms of the shape of the buy, look, we're very sensitive to weather.

The World Cup has been for sure factored into our buying and into our thinking around trade plan shape, and with the weather expected to turn really positive next week, we are feeling positive about the shape of trade, and we're well set up for it.

Okay. Thanks very much.

Thanks, Izabel.

Morning, Ken. Morning, Imran.

Thank you for taking my questions. I just had two, if I may.

My first question was on convenience. I just wondered if you could give us some color on the performance of the convenience estate versus the large stores, and sort of any more color on the impact of the Aldi Price Match extension to Express.

Then my second one, you've mentioned the World Cup a few times, was just wonder if you could give maybe a little bit more color on historically how much has or how has the World Cup influenced trading, the shape of trading, and is it more sort of the marketing opportunity or a footfall opportunity for people buying that bit more alcohol? Thank you.

I can give you a bit of color on the channel sort of split to bring that a bit of life for you. If you break down the different channels, what you would have is online growing at around 9%, large stores growing around 1.5%, and convenience slightly down.

That is driven by obviously the tobacco industry trends, as you would expect, but also the lap of the hot weather, where you would imagine in convenience, when hot weather comes in, you also have the drinks, the ice creams, the impulse products that clearly have an immediate impact on that, and also the fact that one of our competitors had been quite disrupted within their convenience channels, which obviously had been a tailwind for us last year. All in all, I look at the market share in all three channels, we're in a good place.

Listen, Manjari, in terms of World Cup, yes, we do mention it. I think we mention it more from a consumer sentiment point of view than necessarily from a big change in consumer behavior, where the weather has a much bigger impact on consumer behavior and buying habits.

I think, given that confidence has taken a step back since the war in the Middle East, we think it could, together with a sustained peace deal in the Middle East, give consumer confidence a bit of a boost, which will be really welcome. Then if we kind of get some decent weather, which we're due to get, I think that will also help a lot, and, as I said, we've planned for that.

That's great. Thank you.

Thank you.

Hi. Good morning.

Thanks for taking the questions. Two from me.

Firstly, I guess just to clarify, it sounds like, Imran, you're saying you're happy with full-year EBIT consensus, in that sort of upper quartile, shall we say, of the guidance range. Just hope you can confirm that's the case.

Also say what kind of volumes we sort of need to see to get there. Looks like maybe minus-1 in the first quarter, how much of a recovery do we need to get there in the latter part of the year.

Then the second one, just sorry to get bogged down in the shorter term again, but I do think like-for-like momentum quite important at the minute. The second quarter, we're looking at the sort of softer comps, maybe some staycations, and obviously those Irn-Bru sales coming through.

Does it feel like we should have seen an inflection point in the sort of first quarter into the second quarter, or do you think that could be the third quarter before we start to see the like-for-like improve? Thank you.

Look, I think on the EBIT number, just to give you the long answer and then the short version as well. The long version being that the range, the £3 billion to £3.3 billion, I would say, as I always say, we aim to grow profits every single year.

The low end is to give us the flexibility and the space in case consumer sentiment turns. Nine months to go is a long period.

Far, consumer sentiment hasn't turned and has actually been in line with prior year, and as I said, our first quarter performance on sales, profit, and cash is in line with our expectations. That's a really good place to start off with.

Then clearly, if I look at consensus, I feel right now it's within that range and therefore I feel good about where it is. That's also important.

Then in terms of volume, to give you a little bit of color maybe, if that helps, right? If I take it in the round for quarter one, volume mix within food is broadly flat, and we had a stronger performance than that even in fresh food, so that's important.

Then again, I mentioned it before, but clearly the volume is impacted as well by the lap within clothing and non-food, right? Especially within clothing last year, we had an 11%, 10.5% growth or so in quarter one.

When you lap that, you obviously have a negative impact on that. Then when I think about the quarters two, three, and four, I think it would be very unhelpful if I did sort of a month-by-month play, but the way we think about it, broadly speaking, is half one had fantastic momentum behind it, driven by weather, disruption, and frankly our brilliant execution on availability and all the propositions we brought in.

I think the availability and all the propositions we're bringing in are as strong or even stronger than last year, but as you would expect, there is a lap impact on weather and customer and competitor disruption that was helpful to us. That will straddle Q1, Q2, but, I would expect then that us to come out of that at some point, but exactly which precise month, I'm not going to get into.

Very clear. Appreciate it.

Thank you.

Thanks, Rob.

thank you for taking my question. Two, if I may.

Just back to Rob's point about the consensus again and range, you've got a good Q1, you said in line with your expectations, why not potentially narrowing down the range, what are you concerned potentially not to be more precise going into Q2 and Q3? The second one is more about the catering and the food-out-of-home environment in the UK.

Have you seen any changes of behavior recently, and what are you prospect potentially going forward?

Honestly speaking, on the first question, it's a question of timing, right? We're basically just three months in.

You see the same headlines I do, right? We see the same ones as in uncertainty on the macro does exist out there, and consumer confidence levels have and continue to be low.

The good news is we haven't seen that low consumer confidence translate into different behaviors, and that's good. Look, with nine months to go, I would say to you: one quarter down, happy where we are, nine months to go, and we'll keep you posted as we come and speak to you again in October.

Then

on your second question, which was around catering performance, is that right? Are you talking about wholesale?

Yes, correct.

I think, Xavier, if you think about it, last year actually the catering performance was outstanding, and it was really driven by the exceptional weather we had. We've had exactly the opposite this year, where we've had very poor weather, so that's had a particular impact on catering performance.

Again, from an offer and proposition point of view, nothing's changed. We're as competitive as we've ever been in terms of value, our reach is unparalleled, and our customer service and satisfaction scores are stronger than ever in Booker.

We don't have any concerns about the fundamentals, but it is a tough market, and clearly some of the regulation and tax changes have impacted caterers over the last six months in particular.

I would also add, Xavier, just because I think it's helpful just from a philosophy point of view, the same applies to catering as it does on what we said about the UK core business. You don't chase unprofitable sales, right?

We don't buy empty volumes just to get a sales number up. I think A, that impacts the market and its rationality, and B, it actually costs you in the end on the bottom line and in cash, and that's just not a healthy thing to do.

Thank you. That's very helpful.

Hi. Good morning.

The first question is just on the sequential disinflation that you've seen over the last couple of months. Can you just comment on where you're seeing disinflation still come through, and are you seeing any signs of inflation feeding through from the conflict in the Middle East?

Then the second one is on the competitive environment. Obviously last year it was a key focus.

How would you describe the competitive environment at the moment relative to last year? Thanks.

Yes.

Look, on inflation, we have, as we said, seen inflation step down progressively right through the last 12 months. Quarter one this year is even lower than it was in quarter four in the last financial year.

That's really been driven by commodity disinflation. Some key categories like dairy, coffee, cocoa, etc., which has been helpful.

We haven't seen material impacts from the war yet, as clearly it's not a large food-producing region, and most of the kind of commodities like fertilizer, etc., had already been bought for the current season. Now what we don't know is whether there will be a knock-on effect into the second half of the year from things like fertilizer prices, but either way, we would hope that some of that would be compensated by falling commodity prices.

Clearly, commodity price volatility is a thing, and therefore we couldn't give you any kind of forward prognosis on inflation at this point other than it's materially lower than some people were forecasting, and we're doing everything in our power to minimize the impact on consumers.

I would also add to that, clearly what's good is our Save to Invest program, the half a billion we're chasing, we're feeling good. That should help us to continue to sort of inflate a little bit less, inflate a little bit later than the market.

That comes to your second question, how rational is the market? I would say to you last year, as you rightly point out, there was a bit more sort of disruption, and I think we did well through that.

We held our own, we reinvested back, and we still grew. This year, I would say, it's highly competitive as ever, but fairly rational across the board, I would say.

Understood.

Thank you very much.

Thank you.

Hi. Good morning.

Morning, Ken and Imran. Three questions from me, if I can, please.

The first was just on non-food. Imran, I think you mentioned the tough clothing comps plus 10 in the last period.

If you could just give us some sense in the UK of what the non-food growth was like in the quarter, that would be really helpful. The second, sort of reading between the lines of what you've been saying on the consumer, clearly industry volumes are negative, but they have been for over 12 months, you've seen a bit of disinflation, is it right to think, given your comments about aiming to grow profit, growth, etc., that you haven't seen any material change one way or another in the consumer environment versus where we were a few months ago aside from things like the weather?

Then the final question I had was just on retail media. You make these points on the number of awards you've been winning and the contribution from that business increasing.

I'm just wondering whether the World Cup is quite a good opportunity to leverage that business, and what opportunities you see from the tournament. Thank you.

Let me then address the first one on your non-food question. If it helps, just to lay it out for you, in fact.

Food grew 2.6% and non-food grew -0.5%, and the -0.5% is in the face of that clothing number I talked about of close to 10 or over 10. That gives you a sense of how that played out.

On the consumer, Monique, you're absolutely right to say that volumes in the industry have been negative now for over 12 months. We saw that kind of consumer post the good weather of last summer stepped down in the autumn and has stayed largely flat since by way of behavior.

You're right to say that the war in the Middle East and the kind of political uncertainty closer to home have not really impacted consumer behavior. Your final point in terms of retail media as an opportunity is absolutely an opportunity in terms of World Cup activation.

We have a number of exclusives, as we mentioned in my introduction, with people like Walkers, Pepsi, and Budweiser, and we have done a lot of different media activation campaigns to kind of inspire people to enjoy themselves during the World Cup, you're dead right.

Excellent. Thank you.

Thank you.

Hi. Thank you.

Good morning, both. Two quick questions, if I can.

Firstly on UK consumer again. You've been pretty clear on that, but I just wanted to speak in context of the significant increase in fuel prices and your fuel sales being up nearly 20% in the first quarter.

Are you seeing any impact of that in terms of people consolidating shops into bigger baskets and fewer trips, or perhaps it's supporting online growth with people less willing to go out in the car to do their shopping? The second question, just a quick one on market share, with 1Q playing out as you expected in your outlook.

Is your assumption for the full year that you can still gain market share in the UK? Thank you.

Thanks, Matt. I'll take the second question first.

I think we'd always say every year we have an ambition to grow share. That's the kind of framework we laid out a number of years ago, and we're very clear about that as an ambition.

The short answer to that is yes. The second point around the UK consumer and the impact of fuel, we have seen a surge in demand for fuel because we're amongst the most competitive in the market, we have actually gained share during the period.

The online trend is actually a continuation of a trend that was well underway long before the fuel prices became an issue, and is just a continuation. The growth in grocery home shopping and quick commerce shopping is effectively persisting, and we are taking full advantage of that.

It's also fair to say that over the last three years, a great source of growth for us has been the consolidation of baskets, and that's something we continue to focus on.

Great. Thank you.

Thanks, Matt.

Thank you very much, Sergey. Thank you everyone for joining the call this morning.

We really appreciate the great questions and your time, and we really look forward to catching up with you again in October for the interim results. Have a great week and the best of luck to both England and Scotland in the World Cup.

Take care.