£4,800 may seem like a handsome lottery prize to some, but for Tesco, it’s merely one minute’s profits. Clearly, every little helps. The supermarket leviathan outdid itself once again this week when it released its interim results, posting a net profit of £2.5 billion on the back of sales of approximately £40 billion.

Overall, profits swelled by 10 percent, with growth driven primarily by the non-food sectors. The company’s share buyback scheme also appears to have gathered pace, with almost £470m worth of shares re-purchased so far - with plans to increase original £1.5bn to £3.0bn.

The retailer ascribed the good performance in the UK to a number of factors. “We’ve introduced significant changes to our ranges in response to customer demand,” its statement read. “For example, we are selling a much larger organics range which is now fully integrated into ranges across our stores - with sales up almost 40 percent; we have introduced over 2,000 new premium lines, including a faster pace of new product launches for Finest.”

The NFU responded to news of Tesco’s results by saying that it is less concerned by the retailer’s profit margins and more with how it treats its farmer and grower suppliers.

"On that score, there have been significant and encouraging developments, both with the new deal being offered to Tesco’s milk suppliers and in the arrangements being put in place to source local products for Tesco stores.

“We will continue to encourage Tesco to apply the blueprint which they have adopted for their liquid milk supplies across the whole range of British produce that they source, so as to reassure their customers and reinforce the economic sustainability of their supply base.”

Topics