Business

Tesco suspends three more top staff

Tesco store sign Image copyright PA

Supermarket giant Tesco has asked three more executives to leave their posts as the fall-out continues from its £250m profit guidance overstatement.

They take the number of suspended executives to eight.

Tesco said, "We have asked three employees to step aside to facilitate the investigation into the potential overstatement of profits in UK food.

"We will provide an update on the investigation with our interim results on 23 October."

Tesco shocked investors in September with the revelation that it may have overstated its profits by £250m.

At the start of this month, Tesco said it had been notified by the Financial Conduct Authority that it was under investigation over the guidance error.

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An internal investigation is being carried out by the accountancy firm Deloitte and law firm Freshfields.

The company has a new boss, Dave Lewis, who took over as chief executive from from Philip Clarke on 1 September.

He has made clear that the actions taken against the Tesco executives are not "disciplinary or an admission of guilt".

How the company came to overstate its future profits by such a sum is not yet clear. In the meantime, billions have been wiped off the value of Tesco's stock market value as a result of the misreporting.

Others who have been suspended include former commercial director Kevin Grace and UK managing director Chris Bush.

Tesco's share price has plummeted 50% in a year as falling sales, boardroom reshuffles, and increased competition from rival supermarkets such as Aldi and Lidl have unnerved investors.

This week, Mr Lewis refreshed his board with the appointment of Compass boss Richard Cousins and former Ikea boss Mikael Ohlsson as non-executive directors.

Tesco still has a 28.8% share of the UK grocery market, according to retail analyst Kantar Worldpanel.

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