Tesco CEO's £10m pay package overshadows Q1 sales jump
By Frank Prenesti
Date: Friday 14 Jun 2024
(Sharecast News) - British supermarket chain Tesco on Friday held annual guidance after reporting a 4.6% jump in UK first-quarter sales, but the £10m pay packet for company boss Ken Murphy was the only number in focus.
UK retail sales on a like-for-like basis for the 13 weeks to May 25 came in at £11.3bn as the company said its UK market share had grown 52 basis points to 27.6% as it clawed back customers from its main rivals amid the cost-of-living crisis.
Shareholders were set to vote on Murphy's pay deal at the company's annual meeting on Friday. He "absolutely accepted" that he was well paid as his salary more than doubled to £9.9m for the year to February 29, driven by a performance-linked bonus of £8.3m.
Sharon Graham general-secretary of the Unite union said Murphy's wage increase was a "slap in the face to the millions of struggling workers and their families who paid for it through higher food bills".
"The fact is, Tesco has taken advantage of the cost-of-living crisis to rake in obscene profits, and it is far from the only one."
AJ Bell investment director Russ Mould said Murphy's pay may not be in the league of Tesla chief Elon Musk's $45bn - signed off by shareholders on Thursday - "but it still sticks out at a time when many of the company's staff and shoppers are feeling the pinch".
Tesco still expects retail adjusted operating profit of £2.8bn for the current fiscal year, up from the £2.76bn it reported in 2023/24.
Group sales were up 3.4% to £15.3bn, driven by strong volume growth across the UK, Republic of Ireland and Central Europe supported by easing inflation.
"We continue to be the cheapest full-line grocer and are the most competitive we've ever been, with our value, product quality and service driving better brand perception and customer satisfaction," said chief executive Ken Murphy.
"Our market share reflects this, growing more than at any other time in the past two years, with customers switching to us from other retailers, shopping with us more often and with more in their baskets."
Reporting by Frank Prenesti for Sharecast.com
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