In any normal week, and certainly in years gone by, Tesco reporting annual profits for the year to 22 February would be dominating press coverage. But these are not normal times: this week, just as with the past few, we are being served up wall-to-wall Trump and tariffs.

Tesco boss Ken Murphy and CFO Imran Nawaz will likely have spent much of today trying to analyse what the latest machinations of the US president will mean for its trading in the coming weeks and months, but at 7.30 this morning it was “too early to tell” as Murphy played a straight bat to the many journalists trying to prise a killer quote from him.

Fair enough – the tariff picture is nothing if not fluid, though Murphy was keen to point out that food makes up 93% of the Tesco business and its focus on UK sourcing means its direct exposure to the impact of tariffs is limited to some degree. Of course, how these trade wars affect the millions of Tesco customers worrying about their pensions and investments is another matter.

A challenge Murphy was prepared to comment on this morning was that of Asda and the recent declaration from its executive chairman Allan Leighton that it is investing significantly into lowering prices and is aiming to be between 5% and 10% cheaper than its main supermarket rivals.

Tesco this morning did hint at a possible looming supermarket price war as it gave out a full-year profit forecast of between £2.7bn and £3bn, which is anything from £100m to £400m less than this year.

Tesco wants to win ’highly competitive market’

Having said that, Murphy seemed pretty unfazed by what its rivals are up to, and confident in where Tesco is sitting right now.

“We are setting ourselves up for the year ahead with the flexibility to continue to win in a highly competitive market,” he said.

“Despite inflationary headwinds, we are committed to ensuring customers get the best possible value by shopping at Tesco and see further opportunities to strengthen our competitiveness.”

And as far is Asda is concerned, “I think I would point to a general intensification of competition across the board.

“There have been statements made in the press by one competitor, but in truth we’re just seeing a very competitive market and we’ve led the charge in terms of making sure customers get great value with Tesco.”

It’s certainly hard to argue that Tesco should be unduly worried by Asda right now. Of course, it will not want to be outflanked in price and will respond to any moves from Asda or any other rival, but as we stand there are two very strong performers among the traditional big four supermarkets – Tesco and Sainsbury’s. Morrisons is still in something of a turnaround phase, though the signs under CEO Rami Baitiéh are encouraging, while Asda has many more issues to address beyond price.

Tesco, meanwhile, is sitting on a market share of 28%, its highest for a decade. Its core stores are performing well, as is its online operation. Its rapid delivery service Whoosh is flying, as its is own label offering, particularly its Finest range.

Aside from worrying about Trump, the concerns for Murphy and Tesco seem to be those that are hitting the whole grocery sector right now. These are rising costs such as National Insurance employer contributions and the ever-thorny issue of business rates.

And a new worry might just be wholesale. Sales at its all-powerful Booker wholesale division fell 1.8% in the past year. It comes after we saw an even bigger fall for Co-op’s wholesale division last week. Tesco said the fall was down to a decline in tobacco sales and challenges for the fast food customers of its Best Food logistics arm.

Booker has been a runaway success for Tesco since it completed its acquisition in 2018. Many rivals have attributed their own struggles to the impact of Booker and its Tesco-fuelled buying power. It will be fascinating to see what Tesco and Booker can do now to get the business firing again.

Tesco will surely have a plan – and it’s unlikely to get too distracted by Trump or Leighton.

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