The City was impressed with Tesco chief executive Phil Clarke last week when he delivered his first full-year results, although sales slipped slightly by 1.28% on the day.

Shore Capital analyst Clive Black said the figures were broadly in line with market expectations, but he will tweak his forecasts to show slightly lower profits in the UK and US, and slightly higher profits in Europe and Asia.

He said: “We welcome the candid nature of Tesco’s assessment that it was not just market conditions that contributed to its at times below par performance [in the UK], there were deficiencies in its own camp.”

Bernstein analyst Christopher Hogbin said: “The tone displayed more balance and candour than we have previously seen, for example, in describing UK performance.”

Barclays Capital analyst Marc Hazelton said that Tesco’s plan to link management remuneration to return on capital employed “should please shareholders”. The grocer said it expected return on capital employed to improve in all regions.