Tesco slashes dividend and unveils fresh profits warning

Tesco, Britain's biggest supermarket chain, has cut its interim dividend by 75pc and issued a fresh profits warning.

The struggling retailer also announced that the new chief executive, Dave Lewis, will join the company on Monday, a month earlier than planned.

Tesco said in a trading update on Friday: "The business continues to face a number of uncertainties, including market conditions and the pace at which benefits from the investments we are making flow through in the second half and consequently the board has revised its outlook for the full year.

"We now expect trading profit for 2014/15 to be in the range of £2.4bn to £2.5bn. Trading profit for the six months ending 23 August 2014 is expected to be in the region of £1.1bn."

Mr Lewis will be reviewing all aspects of the froup in order to improve its competitive position and deliver attractive, sustainable returns for shareholders, Tesco said.

The company is also cutting capital expenditure by £400m this year to "no more than £2.1bn" - this is a reduction £600m from the previous financial year.

Tesco will make cuts in IT and slow its roll-out of its stores refresh programme.

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