Tesco Plc Financial Statements Analysis Essay Example
Assignment Module Financial Statement Analysis
1. Introduction to the company and its role within the wider international market; including competitors and current market conditions that may impact on its financial performance. Tesco plc is a British multinational grocery and these days the third- largest retailer worldwide in terms of revenues, operating in 14 countries across Europe, Asia and Nord America.The retailer was founded in 1919 and operated exclusively within the UK until the early 1990s when it started diversifying geographically. Tesco in its early years only offered foods and drinks in its stores but then successfully diversified its product range to electronics, books, household appliances, clothes, financial services and telecoms to mention only a few as examples. Tesco employs more than 500,000 people globally in more than 6,500 stores, whereof more than 290,000 people are working in more than 3,000 stores in the UK where Tesco has a market share of around 30 %. Globally Tesco’s main competitors are the US-retailer Wal-Mart and the French retailer Carrefour, in the UK its main competitor became recently Sainsbury’s plc - which is compared regarding its performance to Tesco in the second part of this paper – as well as Asda Stores Ltd. and William Morrisons Supermarkets plc. Recently, Tesco had to struggle with financial problems, especially in the UK where its profits fell for the first time in 20 years (cf. Graham Ruddick, The Telegraph, 30 September 2012) and in the United States where its subsidiary Fresh & Easy only during the first half in 2012 made losses amounting to £ 74,000,000. Generally the retail market is especially due to the high competition quite saturated and the retailers have to struggle with the “challenging economic backdrop” (Justin King, chief executive Sainsbury’s) as well as the external environment which “continues to present challenges all over the world” (Philip Clarke, chief executive Tesco). In the UK Tesco had
1. Introduction to the company and its role within the wider international market; including competitors and current market conditions that may impact on its financial performance. Tesco plc is a British multinational grocery and these days the third- largest retailer worldwide in terms of revenues, operating in 14 countries across Europe, Asia and Nord America.The retailer was founded in 1919 and operated exclusively within the UK until the early 1990s when it started diversifying geographically. Tesco in its early years only offered foods and drinks in its stores but then successfully diversified its product range to electronics, books, household appliances, clothes, financial services and telecoms to mention only a few as examples. Tesco employs more than 500,000 people globally in more than 6,500 stores, whereof more than 290,000 people are working in more than 3,000 stores in the UK where Tesco has a market share of around 30 %. Globally Tesco’s main competitors are the US-retailer Wal-Mart and the French retailer Carrefour, in the UK its main competitor became recently Sainsbury’s plc - which is compared regarding its performance to Tesco in the second part of this paper – as well as Asda Stores Ltd. and William Morrisons Supermarkets plc. Recently, Tesco had to struggle with financial problems, especially in the UK where its profits fell for the first time in 20 years (cf. Graham Ruddick, The Telegraph, 30 September 2012) and in the United States where its subsidiary Fresh & Easy only during the first half in 2012 made losses amounting to £ 74,000,000. Generally the retail market is especially due to the high competition quite saturated and the retailers have to struggle with the “challenging economic backdrop” (Justin King, chief executive Sainsbury’s) as well as the external environment which “continues to present challenges all over the world” (Philip Clarke, chief executive Tesco). In the UK Tesco had