Profits at Britain's biggest retailer have risen again, this time to nearly £3bn, thanks a slew of price cuts.
Tesco announced an 11% increase in adjusted operating profit to £2.8bn, while group sales improved 7.4% to £61.5bn.
As a result of the growth the retailer has hiked its full-year dividend per share by 11% to 12.1p.
The company has also said it will buyback £1bn worth of shares following the successful £600m sale of its banking arm.
The supermarket, which boasts a 27.3% market share in Britain, is benefiting from its price match strategy which sees it rival discount grocer Aldi on a number of key items.
It's free-to-use clubcard scheme also provides lower prices for its members.
Ken Murphy, Tesco CEO, said: "This strong performance reflects the hard work of colleagues across the whole Tesco Group, and their commitment to serving our customers. Customers are choosing to shop more at Tesco, which is reflected in growing market share as they respond to the improvements we’ve made to the value and quality of our products.
"Inflationary pressures have lessened substantially, however we are conscious that things are still difficult for many customers, so we have worked hard to reduce prices and have now been the cheapest full-line grocer for well over a year.
He added: "We have continued to invest in helping customers where it matters most, cutting prices on more than 4,000 products and doubling down on our powerful combination of Aldi Price Match, Low Everyday Prices and Clubcard Prices.
“Customer perception of the quality of our products is growing ahead of the market and we continue to win customers from premium retailers, with sales of Tesco Finest now exceeding £2bn."
FTSE 100
The UK's flagship share index, the FTSE 100, was up 44-points at 7,979 shortly after opening this morning.
Brent crude oil futures were up 0.31%, trading at $89.70 a barrel.
Companies reporting today
- Tesco - Full year results