Britain's biggest retailer Tesco forecast flat profit in its new financial year after recording a 6.3% fall for 2022/23, hurt by its move to shield consumers from the full force of soaring inflation.

The group, which has a 27% share of Britain's grocery market, said on Thursday it made retail adjusted operating profit of 2.49 billion pounds ($3.11 billion) in the year to Feb. 25 - in line with guidance of 2.4-2.5 billion pounds but down from the 2.65 billion pounds made in 2021/22.

"We expect to be able to deliver a broadly flat level of retail adjusted operating profit in 2023/24," Tesco said.

It forecast retail free cash flow within its target range of 1.4-1.8 billion pounds and adjusted operating profit of 130-160 million pounds for its bank division.

"We are...confident that we have the right strategy to keep winning," it said.

"We will continue to prioritise investment in our customer offer whilst doing everything we can to offset the impact of ongoing elevated cost inflation." ($1 = 0.8012 pounds) (Reporting by James Davey; Editing by Kate Holton)