Tesco has issued a shock profit warning today reducing its full-year forecasts from £2.8bn to £2.4bn. It has also reduced its interim dividend by 75% to 1.16p per share.
The news comes as the retailer’s new boss Dave Lewis is joining more than a month earlier than expected.
Shares in Tesco fell 8% in early trading and later traded 6.7% lower at 228.9p.
The supermarket is expecting profits of £1.1bn for the six months to 23 August.
Tesco chairman Sir Richard Broadbent said: “The Board’s priority is to improve the performance of the Group.
“We have taken prudent and decisive action solely to that end. Our new chief executive, Dave Lewis, will now be joining the business on Monday and will be reviewing every aspect of the Group’s operations. This will include consideration of all options that create value for customers and shareholders.
“The actions announced today regarding capital expenditure and, in particular, dividends have not been taken lightly. They are considered steps which enable us to retain a strong financial position and strategic optionality.”