Supermarket group Tesco has reported a nine per cent jump in profits despite intense competition, which drove down prices in the UK.

The group said pre-tax profits for the 24 weeks to August 12 jumped from £381 million last year to £415 million.

Chief executive Terry Leahy said: "These are strong results reflecting the successful implementation of our strategy against a tough background at home."

The group also confirmed expansion plans it announced in April. These would see it create 20,000 jobs worldwide this year, 8,000 of them in the UK. Tesco said it remained difficult to get new retail space in the UK. Despite this, it opened 19 new stores in the first half. Internationally, it was looking to expand in Asia and Europe, where it will have 68 stores by the year end and 130 by year end 2002.

Mr Leahy added: "We have the fastest organic growth rate of any major international retailer. Tesco is moving from being a domestic player to being an international retailer of real scale, giving us a strong position in the league of major international retailers."

Tesco said its core market in the UK had seen "intense competition for customers" and continued: "This has been tough for the industry, but in this environment we continue to trade strongly and gain market share."

During the half-year, sales in the UK grew 7.5 per cent to £8.9 billion, while on a like-for-like basis, stripping out the effect of new store openings, sales were up 3.9 per cent. Tesco added it had cut prices, improved product availability on the shelves, extended trading hours and revamped its products, with the re-launch of its Organics range and further development of its Finest brand. The group was also creating more space for its non-food products, which it expected to be on offer in 140 stores by February.