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Executive Summary:

This report aims to analyze the financial position of TESCO PLC from the point of view an investor who seeks to evaluate the prospects of buying shares of a company in food and retailing sector. The potential investor has selected TESCO PLC and has asked the author to analyze the investment prospects and present a report on the same.

The analysis shall be based on the most recent annual financial statements available for TESCO and of other companies in the same industry. The analysis will not take into account the half yearly and quarterly financial data and updates issued.

The scope of analysis shall be limited to the financial strengths and weakness of the company through its financial statements of the last year and previous years and by a comparison within the retailing industry. The scope does not include the strategic strengths and SWOT analysis of the company however risks or opportunity factors related with company’s financial weakness or strengths shall be reviewed in this report.

The structure of the report is as follows:

After a brief introduction of the company, the report outlines the methodology employed for financial analysis and steps involved. Following the methodology, the main sections of the report then discuss various aspects of the financial analysis including accounting principles of the company, quality of financial statements and financial performance study through ratio analysis. Based on the given analysis, the report ends with a conclusion and a recommendation for the potential investor.

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Introduction of the Company and Sector: TESCO PLC is one of the world’s leading international retailers. With a turnover of GBP 42.6 billion for year 2006, it is the largest British retailer and the world’s third largest retailer behind Wal-Mart (USA) and Carrefour (France). TESCO controls 30% of the grocery market in the UK, which is approximate to the combined market share of its closest rivals, Asda and Sainsbury's. Apart from being the national leader in the food sector, TESCO sells almost everything books, CD/DVD/mini-discs, hi-fi and household appliances, household equipment, flowers, wine, apparel - the list goes on and on! With an eye to the future, Tesco has adapted to the rapid technological changes. It makes an astonishing profit from its on-line sales site Tesco.com. Tesco Express also owns gas [petrol] stations and provides financial services: a joint venture with the Royal Bank of Scotland enables it to offer life insurance and general insurance (home, car, pet, and travel), credit cards and advantageous loan and savings schemes. In addition to 1988 stores in UK, TESCO is well established in Ireland, Central Europe (Poland, Slovakia and the Czech Republic) and Asia (Thailand and South Korea) totalling to 1274 stores outside UK (as of 24 Feb 2007 – Annual Report 2007) The most recent financial statements of the company were issued on 16 April 2007 for the financial year closing on 24th Feb 2007. Groups Income Statement, Cash flow statement and Balance sheet are attached to this report in Appendix-A. The notes to financial statement are not included in the hard copy of this report however are available in the soft copy issued along with this report.

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PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . however. Table 1: Selection and definition of Performance measures 3 o m w w w w . after having measured the company’s financial strength through above criteria. in the following table. Operating Profits Profit (loss) before tax / Total Revenue Profit (loss) before tax* / (SH funds+Non cur. holders Liq. the most important step is to evaluate whether investing in the stocks of this company carry the required returns for investment.c Methodology of Financial Analysis: The financial strength or weakness of a company is measured against the following basic criteria: • Liquidity. Solvency and Gearing Financial Efficiency Stocks Performance *Defined as per FAME database Note: Other ratios may be discussed or analyzed as required in the analysis below.d o c u -tr a c k . ratio Solvency ratio (%) Gearing ratio (%) Stock Turnover Collection Period Credit Period P/E Ratio Share Price trend Measure or Ratio Definition Time growth of Revenue. the key ratios that will be utilized in the analysis: Performance Aspect Growth and Profitability Measure or Ratio General Growth Profit Margin (%) ROCE (%) ROSF (%) Current Ratio Sh. I have short-listed. From an investor point of view. liab. This shall be done by: • company’s stock performance The company’s performance on these dimensions shall be measured through financial ratios analysis. As there are many variations of ratios available to measure more or less the same aspect of performance.c O W w .) Profit (loss) before tax / Shareholders funds Current Assets / Current Liabilities Shareholders funds / long term Liabilities Shareholder funds/Total assets (Longterm Liabilities + Loans)* / shareholder funds Total revenue / Stocks Accounts payable / Total revenue x 360 (in days) Accounts recv’bles / Total revenue x 360 (in days) Share Price / Unit share earnings Historical trend Liquidity. Profitability and Financial efficiency. Solvency.d o c u -tr a c k ! w o .

000 2 12.d o c u -tr a c k ! w o .565.436.c O W w . a summary of company’s financial strengths and weaknesses shall be presented and a recommendation shall be made regarding the prospects of investment in the company stocks.151.000 5 3.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N .249. STEP 1: Definition of Peer Group A standard peer group available in FAME database with companies ranked in the order of turnover of last financial year is as follows: Company Name Median TESCO PLC J SAINSBURY PLC WM MORRISON SUPERMARKETS P L C SAFEWAY LIMITED SOMERFIELD LIMITED WAITROSE LIMITED ICELAND FOODS LIMITED Year LY 2007 2007 2007 2007 2006 2007 2007 Turnover th GBP 6.300 6 1. Also.000 1 17.436.d o c u -tr a c k .462. the ratios shall be analyzed with timetrend and in comparison with peer group or industry. the ratio analysis shall be done in specific context and in conjunction with other complementary analysis.500 4 5.c Acknowledging the limitations of the ratio analysis.500 42.337 7 Table 2: Selection of peer group SOMERFIELD has been making losses recently and WAITROSE and ICELAND FOODS are relatively much smaller companies with whom bench marking TESCO will not be 4 o m w w w w .641. Systematic analysis shall be done in following sequential steps: Step-1: Definition of Peer group and selection of companies for comparison Step-2: Review of accounting policies and comparison with peers to ensure a likefor-like comparison Step-3: Review of auditor’s opinion to ensure that any audit qualifications are duly noted during comparison Step-4: Check of any irregular / exceptional items in the financial statements Step-5: Financial ratios / measures analysis (as per Table 1 above) Finally.000 3 6.497.

for a proper comparison purposes. Goodwill is recognized as an asset on the balance sheet and allocated to each Cash Generating Unit (CGU) as per IAS 36. GCC. Sainsbury and Carrefour have used IFRS. Only for a review the accounting policies. all other European companies TESCO. it is important to review that accounting policies adopted by the company are in general in line with industry norms and practices and that there is no specific policy which may make the comparison of some ratios or performance irrelevant merely sue to way it is applied. Except Wal-Mart which has not clearly mentioned the accounting standards in the notes.d o c u -tr a c k . Singapore and other countries. Goodwill: Goodwill represents the excess of purchase price over fair value of net asset acquired. Therefore.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . I have reduced TESCO’s peer/competitor group to include only the top 4 UK companies in this sector which are: • • • • TESCO PLC J SAINSBURY PLC WM MORRISON SUPERMARKETS P L C SAFEWAY LIMITED STEP2: Review of Accounting Policies: Before starting to analyze the financial statements. Australia. India. in this section. Accounting and Reporting Standards: Until 2005. we have added two non UK international companies for comparison and these are Carrefour and Wal-Mart. Russia. Goodwill is no more capitalized and amortized.c O W w .d o c u -tr a c k ! w o . Therefore. TESCO was reporting financial results in line with UK GAAP but from 2006 onwards.c accurate and appropriate. last two years financial reports have been issued in accordance with IFRS which is now mostly adopted standards in almost 100 countries including EU. we will discuss these policies in comparison with peer group / competitors in the same sector. but 5 o m w w w w .

Again no significant differences are found. TESCO (and its peers/competitors including J. Example of such test is an entry in TESCO’s income statement where impairment losses are registered for a cash generating unit at GERRADS Cross Site (see Income Statement 2007) Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalized by TESCO and its peers. and Wal-Mart) treat goodwill as an asset and impairment tests are done annually or when needed. Tangible Fixed Assets: Property. plant and equipment are depreciated by straight line method over useful life.). Sainsbury. All of them use a straight line depreciation of definite-lived intangible assets (licenses or software etc. This is consistent across the retailer industry as seen from statements of TESCO. Sainsbury. For R&D Expenses. Carrefour. but in principle.c O W w . The impairment test procedure may be different in different companies. Other Intangible Assets: No major differences in accounting practices are found between TESCO and its peers/competitors including J. Carrefour. goodwill is subject to impairment tests which are conducted at least once a year or whenever a need is realized. Carrefour and Wal-Mart. these are amortized over project’s useful life.d o c u -tr a c k . A slight variation in lifetime is noticed between different companies on deciding the lifetime of the equipment but these differences are minor. For example Carrefour and Tesco have a maximum life limit of 40 years for buildings while Sainsbury and Wal-Mart have it set at 50 years.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . Inventories at TESCO are valued at lower of cost and fair values less cost to sell by using weighted average method. Sainsbury differentiates inventories at warehouse and at retail 6 o m w w w w . Sainsbury.d o c u -tr a c k ! w o .c now in accordance with IFRS 3. there is no significant difference in TESCO practices from industry specific usage. and Wal-Mart. Impairment tests are done for all tangible or intangible assets are done at least once a year.

PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . Sainsbury and Wal-Mart do not make any mention of inflation adjustment in high inflation countries as done by Carrefour which adjusted for Turkey in 2005. 7 o m w w w w . Therefore.d o c u -tr a c k . in this section we don’t record any specific caution regarding TESCO financial statement impacted by their accounting policies and we can move on next section without qualifications. income tax and income per share calculations are in principle similar in all of these companies. It makes the foreign exchange sensitivity important. Before assessing a company’s financial position. Nevertheless all of the companies reflect any differences in the income statement on the last day of financial year end. it is important to know about auditor’s opinion about these financial statements.last day of the financial year in accordance with applicable accounting standards (IFRS) and that statements are prepared in accordance with legal requirements of the Company Act and IAS regulation. employees’ benefits. STEP 3: Review of Auditor statement Auditors report is an indicator of credibility of financial statements. No such differentiation is mentioned in notes of TESCO statements. investment properties. Foreign Operations and Exchange rates: About 25% of TESCO sales and profits are coming from operations outside UK. At Tesco foreign currency transaction are converted to GBP on the day of transaction. The opinion of the auditors (PricewaterhouseCoopers LLP) on the TESCO PLC financial statements for the last year confirms that financial statements give a “true and fair” view of the affairs as on 24/02/2007 .c O W w .c outlets and values latter ones at average cost price. The notes to accounting statement of TESCO. Similarly other practices related with financial assets.d o c u -tr a c k ! w o .

ensure that he has understood the impact of these items on the company’s income statement and these don’t form significant part of the company’s earning for the given year.95 % .’ (TESCO PLC Annual report and financial statement 2007. Therefore. the first and most basic financial reporting quality check is complete and we can proceed to further analysis.d o c u -tr a c k ! w o . As an investor should mainly be concerned with future performance of the company he must. STEP 4: CHECK of Irregular Items: Irregular items include such items that will most likely not be repeated next year like discontinued operations. extra-ordinary items and changes in accounting principles etc.6% Assessment/ Adjustment Gain(loss) 0 ?? ?? Table 3: Irregular Items in TESCO financial statement 2007 We briefly review both the exceptional items as follows: Gerrads Cross Site: Company’s Operating and Financial Review mentions that company is: ‘….an impairment charge of 35m).c O W w .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . Category Item description Discontinued Operations Exceptional items Profit(loss) from Impairment of Gerrads Cross site (Note …) Pension Adjustments – Finance Act 2006 (Note 23) Stated Impact (GBP.84 % 13. facing continuing uncertainty … complex legal situation following the tunnel collapse.c The auditors report is clean and unqualified and confirms the credibility (fairness and truth) of the financial statements. page 6) The scope of the current report (academic assignment) does not extend to assess the legality of the claims and an assessment of potential risks and liabilities that company may face in this instance.d o c u -tr a c k .899 m) 0. however it is to be acknowledged that a provision may be necessary to 8 o m w w w w . We have written off the carrying value…. We are not yet in a position to assess any recoveries or liabilities in respect of ongoing claims. millions) 18 (35) 258 % of net income (GBP 1.1. therefore. …..

This one-off 258 million addition increases the ROCE by about 1%. For purpose of current report we will assume the auditors have reviewed this point and have agreed that allocation of impairment charges is a fair and true reflection of total liability exposure. 9 o m w w w w . this one-off item is in line with accounting principles and is justified. STEP 5: FINANCIAL RATIO ANALYSIS: ASPECT 1: Revenue Growth and Profitability Since last 5 years. Moreover. however.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . Finance Act revision was agreed. Especially during 2003-05 when all of its peers / competitors were suffering losses and industry average went to loss. These numbers indicate a very well managed business in its sector. For the purpose of this report. this increase in revenue has not caused any drop in profit margin and TESCO has been consistently maintaining profit margin above between 5 and 6% which is above its peer group average. Tesco’s sales revenue has consistently grown while other competitors have had difficulties even in maintaining their sales.c be made in order to evaluate more accurate the return of investment in the company stocks. . This change altered company’s pension scheme assumptions and resulted in reduction of future liability by GBP 258 m which is has been recognized in last year income statement. Pension Adjustment: In April 2006. Although this adjustment may seem to be unrelated with company’s sales revenues. TESCO managed to maintain its profits. however a detailed analysis of note 23 (regarding Pension and post employment funds income/expense) is beyond the scope of current report and mere acknowledgement of presence of such one-off item in the income statement and noting its possible impact on the returns is sufficient for the purpose of this report.c O W w .d o c u -tr a c k .d o c u -tr a c k ! w o .

com) Version Feb 2008 Figur-2: Profit Margin .Comparison and trend Source: FAME (fame.com) Version Feb 2008 10 o m w w w w .bvdep.c Figure-1: Turn-Over – Comparison and Trend Source: FAME (fame.d o c u -tr a c k ! w o .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N .c O W w .d o c u -tr a c k .bvdep.

c O W w .d o c u -tr a c k ! w o .Comparison and Trend Source: FAME (fame.c Looking at the ROCE and ROSF.bvdep.bvdep.com) Version Feb 2008 Figur-4: ROCE – Comparison and Trend Source: FAME (fame.d o c u -tr a c k .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . Tesco has shown consistency and growth in returns of capital and returns of shareholder funds. Figure-3: ROSF .com) Version Feb 2008 11 o m w w w w .

The values and trends of gearing for TESCO and peer group confirm that gearing in TESCO is controlled and management seems to be in full control of borrowings. High gearing.25% (TESCO). TESCO GEARING HISTORY 100 90 80 70 60 RATIOS 50 40 30 20 10 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 ANNUAL REPORT Gearing (%) ROSF (%) ROCE (%) Interest Cover (Times) Figure-5: Effect of Gearing on ROSF/ROCE Graph data sourced from FAME (fame.3% of Carrefour and 11. 26. the greater the risk for investors.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . ASPECT 2: LIQUIDITY.d o c u -tr a c k .5% (Carrefour) and 22% (Wal-Mart).com) Version Feb 2008 12 o m w w w w .c Comparing the 2007 numbers internationally. is not a problem as long as the company can source loans at a more attractive rate than the rate of return the business can generate from additional loan.9% compared with 4. from an investor perspective.c O W w . SOLVENECY and GEARING: Gearing: The increase in revenue and profits reported above. in itself. is to be looked at in combination with the gearing ratio and interest cover. This indicates that TESCO may be 3rd in its revenue size but it’s profitability is very much comparable to its international competitors.bvdep. revenue growth of TESCO was 10.d o c u -tr a c k ! w o .7% of Wal-Mart. ROSF was 25. It is important to check how far the business is bringing these returns out of loan financing and what the company’s exposure to borrowing risks is and how much times the yearly profit covers the interest payable. Lower the level of interest coverage.

d o c u -tr a c k . Although the current level of gearing at 75% is still quite high. The profit margin has to really drop a lot for the interest to become an issue for the company.d o c u -tr a c k ! w o . the company had to increase the gearing i. From 2003 onwards.e. At this point.c O W w . take more loans during 2001 to 2003. This is the time (as seen form figures above) when competitors are having financial difficulties and TESCO has an opportunity to make acquisitions and that’s the reason why TESCO management went for borrowings to increase their market share. but in fact it depends on the nature of the industry. it seems company’s strategy has paid off and the ROCE and ROSF are increasing while the gearing is reducing. In retailing business. Liquidity and Solvency: Liquidity refers to business’ ability to pay its bills. At the last annual report (2006). and it should be a cause of concern for potential investor. the gearing stayed at 75% against peer group average of 122%. however these concerns are somewhat eased by available interest cover of 13 times.5:1).PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . This is confirmed by the current ratios comparison with peer group (as in fig-7): 13 o m w w w w .56. A low level of current assets keeps this ratio low. Solvency is a measure of business ability to pay back its long term debts.c As we can see from the 10 year Gearing history graph. Although it may seem low (some thumb rules suggest it be higher than 1.(takeover of its competitor T & S Stores in January 2003). Current ratio of Tesco has improved over time and in last year statement it stood at 0. it can be considered as not the major issue but this concern has to be reviewed along with wider retailing industry prospects (discussed below). dues and similar other short term obligations (as and when they become due) without affecting the normal operations. the average current ratio is low as it holds only fast moving inventories of finished goods and stock turn over period is in days.

Liquidity Trends Graph data source: FAME (fame.5 Ratio Current Ratio 0.6 0.bvdep.bvdep.0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 ANNUAL REPORT Figur-6: TESCO .Comparison and Trend Graph data source: FAME (fame.1 0.3 Liquidity Ratio 0.d o c u -tr a c k .c Figure-7: Current Ratio .7 0.-8 TESCO .Short term Liquidity ratios 0.2 0.c O W w .4 0.com) Version Feb 2008 14 o m w w w w .d o c u -tr a c k ! w o .com) Version Feb 2008 The long term solvency ratios for TESCO have slowly declined as shown in Fig.8 0.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N .

How long it takes to collect the accounts receivables. The key ratios in this aspect of performance deal with questions like how quickly does the business turn over its inventory as the assets in inventory represent funds tied up which can not be used for other purposes. Tesco’s performance in this area is represented by following graphs and compared with its peer groups. TESCO .00 10.0 30.0 20.0 Shareholders liquidity (Equity / Debt) Ratio 60.c Solvency or Equity/Assets or Equity/Debt ratio is reciprocal of gearing. As explained above.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N .0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 0.Long term Solvency Ratios 5.bvdep. 15 Solvency (Equity / Asset) ratio (%) o m w w w w .00 1.0 Equity / Assets Ratio (%) 4.00 50. Figure-6 and figure-8 actually tell the same story with inversion of denominator and numerators.d o c u -tr a c k ! w o .00 40.d o c u -tr a c k .c O W w .0 Equity / Debt ratio 2.00 3.00 ANNUAL REPORT Figur-8: TESCO – Solvency Trends Graph data source: FAME (fame.com) Version Feb 2008 ASPECT 3: Financial Efficiency Financial efficiency ratios look at how well business resources are managed.00 0. increased gearing or reduced solvency should not be a cause of concern as the company has increased the debt financing required for expansion and acquisitions and shareholders have benefited from such expansions.

c O W w .bvdep.com) Version Feb 2008 Figure-10: Creditors Payment comparison and trend Source: FAME (fame.d o c u -tr a c k .d o c u -tr a c k ! w o .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N .bvdep.c Figure-9: Stock T/over .Comparison and Trend Source: FAME (fame.com) Version Feb 2008 16 o m w w w w .

(Source: http://www.com/) 17 o m w w w w .d o c u -tr a c k ! w o . The following graphs show that historically TESCO shares have outperformed FTSE100 average and also that of food and retailers industry average. this effect is same for all other retailers and in general FTSE100. its share price is susceptible to economic downturns that could affect consumer spending.tescocorporate. Information regarding settlement period for accounts receivable is not available in FAME database. ASPECT 4: Company Future Outlook and Stock Performance.PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . TESCO’s average creditors’ payment period ranging between 26 and 30 days is more or less equal to its peer group average. Figure-11: Total Share Price History. However. Despite TESCO’s consistent performance over the years as shown above by profitability ratios.d o c u -tr a c k . Similarly.c TESCO average stock turnover between 20 and 25 days is equal or better than its peer group average of 24 to 32 days.c O W w .

tescocorporate.com/ During 2007. the share price is falling due 18 o m w w w w .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . there are two important parameters to note when studying the performance of certain stocks. Tesco shares have performed very well due to increase in market share and international acquisitions. PE ratio of TESCO shares has been close to 15 which indicate a good level of market confidence about TESCO future performance. Figure-12: Total Shareholder Returns (TSR is notional return from a share or index based on share price movements and declared dividends). However during Q4-07 and Q1-08. P/E Ratio: P/E ratio takes into the market value of the share and the company earnings per share. This is the ratio of the two. These are: • • Total Shareholder Returns (TSR is notional return from a share or index based on share price movements and declared dividends). Source: http://www.c From an investor perspective.d o c u -tr a c k ! w o .d o c u -tr a c k .c O W w . Performance of TESCO stocks when measured by total shareholders return has been comparatively better than FTSE100 average and also food and retailers industry average.

faces a threat from external economic environment which may cause food items inflation and drop in consumer spending. TESCO. This threat is however a short term threat and in the long term TESCO is though to perform better because of company’s strong management controls and growth strategies in international market. not coming from company performance but actually from external economic environment. 2007 Tesco has turned up the pressure on the Bank of England to cut interest rates tomorrow in an effort to revive consumer confidence in the run-up to Christmas and the new year. TESCO has been consistently growing its revenue and profitability and efficiently employing the gearing to its benefits through wise management strategies. Andrew Higginson. Although TESCO product mix and market mix seems well diversified to counter such UK based threats. 19 o m w w w w . however. but still in the short term it will have a negative impact on its revenue growth and the share price – the sign of which are already starting to appear.c O W w .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N . From The Times December 5. Following news confirms that TESCO has been asking government to cut interest rates to offset the effect on their sales. It’s important that [the Bank of England] starts to show interest rates are going to come down.” The threats to Tesco shares are. said: “The problem is not inflation but consumer sentiment. Tesco’s group finance director.c to effect of consumer spending resulting from credit crunch.d o c u -tr a c k . Conclusion and Recommendation: TESCO strength comes from its market share and turn over in UK which is more than sum of its two immediate competitors. Not only has it outperformed its competitors inside UK. it has also achieved consistent growth outside UK through international expansion and acquisitions. therefore.d o c u -tr a c k ! w o . All the financial performances indicators and ratios clearly show the outstanding performance and growth achieved by TESCO over the past years which has put it in a clear leading position among its peers in UK.

20 o m w w w w . We conclude our analysis by following quote: From The Times December 5. a long term investor seeking to invest in retailing industry may in fact benefit from this short term drop in share price and is recommended to buy TESCO stocks as soon as they fall below 350 pence per share.d o c u -tr a c k ! w o . retailing industry shares in general are not recommended for a short term investor due to forecasted effects of credit crunch and signs of increasing inflation.c From investment point of view.” Mr Kasoulis said. “We continue to view Tesco as the best long-term investment in the European food retail sector. an analyst at Credit Suisse. However. 2007 Andrew Kasoulis. said that the performance of Tesco was in line with expectations.c O W w .d o c u -tr a c k .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N .

co.carrefour.zhtml?c=112761&p=irol-irhome FINANCIAL TIMES: http://www.A Forbes Media Company And Various Other Internet Resources o m w w w w .com/ TIMES ONLINE: http://business. A. 1.com/ INVESTOPEDIA .c LIST OF APPENDICES: Appendix.investopedia. No.com/ WAL-MART Investor information Website: http://investor.co.C: FAME – Standard Report – TESCO Statement (10 years) Appendix. (2000). Peter and McLaney.D: FAME – Standard Report – TESCO Ratios (10 years) References: Artill.com/ (Accessed Version Feb 2008) TESCO PLC Corporate Website: http://www.com/ J-SAINSBURY Corporate website: http://www.uk/ http://www. 2000. The effect of accounting diversity on international financial analysis: empirical evidence. FAME Database: http://fame.uk/ CARREFOUR Website http://www.j-sainsbury. 5th edition.ft. Pearson Education Limited. Laínez. A.c O W w .com/phoenix.A: TESCO – Financial Statement 2007 Appendix. and Callao. Harlow. The International Journal of Accounting Vol. J.d o c u -tr a c k ! w o .timesonline.walmartstores.bvdep.B: FAME – Standard Report – TESCO Profile (10 years) Appendix. Accounting and Finance for Non-Specialists. 35.d o c u -tr a c k .PD PD F- XC h a n g e Vi e w F- XC h a n g e Vi e w er er ! O W N y bu to k lic C m C lic k to bu y N .tescocorporate. Eddie (2006).

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