Tesco suspends executives as inquiry launched into profit overstatement

Tesco has suspended four executives, including its UK managing director, after the supermarket overstated its half-year profit guidance by £250m.

That would be almost a quarter of its expected profit for the period.

It has launched an investigation headed by Deloitte, and says it is now working to establish the impact of the issue on its full-year results.

"Disappointment would be an understatement," said Tesco chief executive Dave Lewis.

Mr Lewis, who only took the helm on 1 September, said it was "a serious issue", but insisted "it doesn't take away from what I'm able to build at Tesco".

Shares fell 8% in early trading.

Mr Lewis said "a number of people" had been suspended from duty "to facilitate the fullest and deepest

Tesco cuts its profit forecast

Struggling supermarket Tesco has cut its full-year profit forecast to £2.4bn from £2.8bn.

In a statement, it said the "challenging trading conditions and ongoing investment...continued to impact the expected financial performance of the Group".

The new start date for new chief executive Dave Lewis has been brought forward to Monday "in order to improve its competitive position".

The dividend has also been cut.

The company said it anticipated a