Tesco will tomorrow unveil annual profits in the region of £2.5bn. The record figure - equivalent to earnings of £4,800 a minute - will come as Tesco faces increasing pressure over its domination of the UK market. Critics have accused Britain's biggest retailer of squeezing out many local stores across the country.

However, CEO Sir Terry Leahy is expected to again come out fighting in defence of the group as one of Britain's global success stories. A significant slice of Tesco's earnings are now abroad, from central Europe to the Far East and a nascent operation in the US. The supermarket group has opened 400 stores in eastern Europe and Asia in the past year, four times as much new space as in Britain at 7.5m sq.ft. It is believed Tesco's results will also be accompanied by news of its plan to roll out its Tesco Express convenience store format in central Europe.

The most recent batch of market-share data showed that Tesco's sales growth in the UK since Christmas had failed to match the pace set by Sainsbury’s and Asda, even though it has opened more outlets. Aside from asking what was behind the slowdown, analysts will want an update on how Tesco's big push into selling non-food products online is going. Tesco launched an expanded version of its Tesco Direct catalogue last month. Tesco will also get questioned about whether it has any more plans up its sleeve for its vast property portfolio. The grocer has formed several property joint ventures already this year, but is opposed to any wholesale sell-off. Sir Terry Leahy, the chief executive, may have an update about the group's ambitious US expansion plans. If he doesn't, he will certainly get pressed to provide one.

NamNews - Monday 16th April 2007

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