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Tesco warns profits could fall amid Iran war uncertainty

about 16 hours ago
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Tesco has warned that profits could fall back in the year ahead, citing increased uncertainty caused by the conflict in the Middle East.Ken Murphy, its chief executive, said that despite concerns about the impact of the closure of the strait of Hormuz on oil, gas and linked chemicals, the UK’s largest supermarket chain was “in good shape” on stocks of fuel for its petrol stations and distribution network.He said Tesco was not currently seeing problems with the supply of food or groceries, or “meaningful” inflation except at the pump on its forecourts.Murphy said he did not recognise predictions from the UK’s Food and Drink Federation that food inflation could hit 9% amid fears of shortages.“None of our growers, suppliers or manufacturers have flagged any supply issues,” he said.

But he admitted: “Ultimately it is an unpredictable situation.The scenario seems to change literally by the hour depending on the latest social media post of the American president.”Murphy said Tesco would “do its best to minimise the impact on customers” and had demonstrated its ability to do so over the last six years of crises, from Covid to Brexit and the ensuing supply chain disruption.He said the biggest recent challenge for food supply had come from storms in southern Spain and north Africa, which supply large amounts of fresh produce to the UK in the winter and early spring, but shoppers “didn’t really notice” as the company had secured supplies elsewhere.However, he said: “Given how quickly the situation globally changes and the volatility of the actors involved, it would be wrong to give any guarantees.

”Tesco gave a warning over a potential drop in profits, which would be the first step back since 2023, after it hit its highest share of the market in a decade, topping 28%.The UK’s biggest supermarket revealed profits rose by 8.5% to £2.4bn in the year to 28 February, as sales rose by 4.3% to £66.

6bn, including strong growth in the UK.It has paid shop floor, distribution workers and other frontline staff a £65m “special performance award” in light of the results, while shareholders have received £937m in dividends during the year.However, the company said it had widened its guidance on profits for the year ahead to between £3bn and £3.3bn, adding: “Much will depend upon the duration of the conflict and in particular, the potential implications for UK households and the economy more broadly.”Murphy said Tesco had won over more shoppers because “despite cost pressures from new regulation, we have increased our investments in keeping prices low, further improving quality and offering even better service”.

He said there had been an “increase in competitive intensity” in the UK, in the face of which Tesco had ensured more than 10,000 of its products were cheaper at the year end than at the start, despite grocery price inflation across the market.Tesco aims to make £500m in new savings in the year ahead, which Murphy said would be ploughed into keeping prices down and improving product quality.The savings will include more use of AI in helping to work out when and how to mark down prices, as well as AI-led finance tools.Murphy said the chain was “committed to doing whatever we can to help keep down the cost of the weekly shop, and with the conflict in the Middle East creating further uncertainty for consumers and the economy more broadly, that commitment matters more than ever”.He said Tesco had not seen any meaningful changes in shoppers’ behaviour as a result of the conflict and households were still looking to eat more healthily and dine more at home.

Despite continuing pressures on household budgets, Tesco reported a 15% rise in sales of its Finest premium own-label range, an 11% increase in online grocery sales and a 51% jump in sales at Whoosh, its rapid home delivery service.
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Five key questions: who overruled decision to deny Mandelson security clearance?

The revelation that Peter Mandelson failed his security vetting clearance, only for the decision to be overruled by the Foreign Office so he could take up his post as ambassador to the US, raises a number of questions.According to multiple sources, Mandelson was initially denied clearance in late January 2025 after a developed vetting process, a type of a highly confidential background check carried out by UK Security Vetting (UKSV), a division of the Cabinet Office.By that stage he had already been announced as Keir Starmer’s pick for ambassador in Washington. Within two days, the Foreign Office had overruled the UKSV decision, granting him clearance despite the recommendation from security officials. It is not known who made the decision to overrule security officials, or why

about 8 hours ago
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Officials debate withholding Mandelson vetting documents from parliament

Exclusive: Opinions split on ‘unprecedented’ release of files, despite demand for ‘all papers’ related to ex-US ambassador’s appointmentRevealed: Mandelson failed vetting but Foreign Office overruled decisionFive key questions: who overruled decision to deny Mandelson security clearance?Senior government officials have been considering whether to withhold from parliament sensitive documents that show Peter Mandelson failed security vetting before he assumed the role of US ambassador, the Guardian can reveal.Any such decision could amount to an extraordinary breach of a parliamentary vote, known as a humble address, that ordered the release of “all papers” relevant to Mandelson’s appointment.The Guardian has revealed that Mandelson did not receive vetting clearance from security officials, but that their decision was overruled by the Foreign Office to ensure he could take up his post.According to multiple sources, officials across government have been in dispute over whether to release documents that would reveal those facts, and other information about Mandelson’s security vetting, to the parliamentary intelligence and security committee (ISC).The committee has been entrusted by parliament with the role of assessing the most sensitive papers relating to Mandelson’s appointment

about 8 hours ago
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Revealed: Mandelson failed vetting but Foreign Office overruled decision

Guardian investigation uncovers decision by UK security officials to deny clearance before Mandelson took up role as US ambassadorTop civil servant Olly Robbins forced out over vetting rowOfficials debate withholding Mandelson vetting documents from parliamentFive key questions: Who overruled the decision to deny Mandelson security clearance?Peter Mandelson failed his security vetting clearance but the decision was overruled by the Foreign Office to ensure he could take up his post as ambassador to the US, an investigation by the Guardian can reveal.According to multiple sources, Mandelson was initially denied clearance in late January 2025 after a developed vetting process, a highly confidential background check by security officials.Keir Starmer had by then announced he would be making Mandelson the UK’s chief diplomat in Washington, posing a dilemma for officials at the Foreign Office, who decided to use a rarely used authority to override the recommendation from security officials.Mandelson’s failure to secure vetting approval has not previously been publicly revealed, despite intense scrutiny over his appointment and the release by the government of 147 pages of documents supposed to shed light on the case.Downing Street released a statement late on Thursday confirming the Guardian’s story

about 9 hours ago
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As an older man, I feel for Peter Mandelson being caught short | Letter

You report that the Royal Borough of Kensington and Chelsea intends to fine Peter Mandelson for urinating in the street at 11pm one night last November (Peter Mandelson faces fixed-penalty notice for urinating in public, 10 April). I’m no fan of Mr Mandelson, but on this occasion my sympathies are entirely with him.I am a year younger than him and, like many men of similar age, what used to be quaintly called my “waterworks” aren’t as robust as they used to be.What was he supposed to do when caught short on a cold night? Wet himself and allow the stream to flow from his trouser leg? Or follow the example of the Danish astronomer Tycho Brahe, who refused to leave a banquet to relieve himself because it would be a breach of etiquette and, according to Johannes Kepler, died shortly after as a result?If the council proceeds with this fine, I assume that it will also fine dog owners who allow their pets to pee in the street. This would be ridiculous, but no more so than what it intends doing with Mr Mandelson

about 10 hours ago
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A decade on from Brexit, Britain still flounders without a place in the world | Letters

Perhaps the saddest consequence of Brexit is that it has left the UK a profoundly unhappy country (Ten years after Brexit, this is the UK: a divided nation frozen in time, 9 April). For Brexit supporters, the dream of a proud, independent Britain able to direct its own destiny in the world is nowhere near fulfilled, as if it ever could be. And they continue to grasp at the nearest proximate cause – an “invasion” of immigrants undermining British identity and draining its resources. For those who wished to remain, Brexit has left them unmoored from the security of membership of a grouping that gave them an identity and clear position in the world.Unfortunately, that unhappiness is now exacerbated by the state of the world outside the UK

about 10 hours ago
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SNP pledges to cap bread and milk prices if it wins Scotland’s parliamentary elections

The SNP will cap supermarket prices for essential goods such as bread and milk if it retains power, John Swinney has pledged, after describing the cost of living as “the defining issue of this election”.With polls pointing to a fifth Holyrood term for the Scottish National party, its leader said he would use devolved public health powers to fix prices on 20 to 50 items such as bread, milk, cheese, eggs, rice and chicken because their rising cost was “impacting our nation’s nutrition”.The eye-catching pledge, made at the launch of the SNP manifesto for the Scottish parliament election, was immediately dismissed as a “potty gimmick” by retailers. It could also put the party on a collision course with the UK government because it may breach the Scotland Act of 1998 that created a devolved parliament.Ewan MacDonald-Russell, deputy head of the Scottish Retail Consortium, said supermarkets already paid significantly higher rates in Scotland, £162m more over the next three years than in England

about 11 hours ago
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Senate Democrats move to stall Trump’s ‘absurd’ bid to install new Fed chair

about 5 hours ago
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Next chief Simon Wolfson paid record £7.4m – and could get far more this year

about 8 hours ago
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Labour and Lib Dem MPs demand ‘shameful’ Palantir NHS contract be scrapped

about 8 hours ago
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Man used AI to make false statements to shut down London nightclub, police say

about 9 hours ago
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Fans and players unite behind Hull’s John Cartwright as St Helens go top

about 4 hours ago
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Tiger Woods mentioned drones over home and car, ‘president’ in remarks after crash, filing shows

about 6 hours ago