By Matteo Castia

 

Tesco PLC said Wednesday that it will repay to the U.K. government and the devolved administrations the 585 million pounds ($785.1 million) of business rates relief it received as support to face the coronavirus pandemic.

The U.K.'s largest grocer by market share said the business rates relief was a "game changer" amid the spring lockdown, when panic buying, pressure on supply lines and safety concerns created a real and immediate risk to the supermarkets' ability to continue to work.

Tesco said the business rates relief helped to partially mitigate coronavirus-related costs, which is estimated to be GBP725 million for this year.

The cash impact of the repayment of the GBP585 million will be split into GBP535 million in fiscal 2021 and GBP50 million in fiscal 2022, the company said.

"Excluding the repayment, our guidance for retail operating profit before exceptional items for fiscal 2021 is unchanged: we expect it to be at least the same level as fiscal 2020 on a continuing operations basis," Tesco said.

 

Write to Matteo Castia at matteo.castia@dowjones.com

 

(END) Dow Jones Newswires

December 02, 2020 02:32 ET (07:32 GMT)

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