Tesco’s shares made a giant leap forward as they closed 10% higher after a rise in sales.
The terrific Tesco sales mean they hit their full-year profit target and are well underway to stabilising the business after a prior accounting scandal.
Shares were 207.10p at the end of the day, 18p higher than their previous standings and the highest level for over a year.
Food prices have been falling for the last two years thanks to the much publicised supermarket price war. The main perpetrators for this price war are Lidl and Aldi, whom provide products for lower prices than the standard big four.
"The market is tough for big retailers," said Dave Lewis, Chief Executive of Tesco. “But this is good news for customers.”
"Whilst the market is uncertain, we have made significant progress against the priorities we set out two years ago, stabilising the business and positioning us well for the future."
"We are winning back shoppers who may have gone elsewhere. You'll see in the results that 200,000 more people shopped at Tesco than a year ago.”
Mr Lewis has set a target for the group’s operating margins to be in the region of 3.5% and 4% by the end of the 2019-2020 financial year.
Expert Jasper Lawler from CMC Markets says that whilst German supermarkets Aldi and Lidl continue their ascent, it’s Asda falling out of favour, not Tesco, whose shares have jumped.
"Tesco has invested heavily in reducing prices in the last two years, and has gradually reduced its customer exodus to the discounters Aldi and Lidl."
It remains to be seen if the ascent of the two German supermarkets may wipe out a major UK store.