Tesco's Financial Summary

Good Essays
5. Overview

A summary of Sainsbury’s & Tesco’s financial performance can be derived from a broad analysis of their statements for the periods (2011-2013). The balance sheets and income statements (from the extended period 2009–2014) are summarised with assumptions made – in Table’s 1–4 in the Appendix.
Income Statements
Tesco’s income statement shows a year on year increase in revenue from 2009 – 2013 (with a slight drop in 2014). Tesco’s sales for the period are very healthy, selling almost 3 times the rate of Sainsbury’s. However Tesco’s gross profit fell by 22.28% and operating profit dropped by 45.09% (despite falling admin expenses) over the 2012/13 period. Tesco also endured property losses, a reduction in JV income, a £1.2 billion
…show more content…
A significant decrease in net assets by 6.4% leading to the same decrease in total equity for 2012/2013 (2014 shows an ever bigger decrease in net assets and equity by a further 11.64%). Non-current assets have risen steadily from 2009–2012 (by almost £6bn) before dipping by 2.33% from 2012-2013 due to group write downs. Current assets on the other hand have risen steadily since 2010 revealing high levels of inventory, trade receivables, loans to customers and cash.
A decrease in value of property, plant and equipment by 3.27% in 2012/13 (and 1.53% in 2014) and humble increase of 0.5% in investment property over the same period. Further property write downs in 2014 have led to massive decrease in investment property by 88.66%. This highlights Tesco’s failed international ventures and their risk taking practice of land banking – buying property during the boom times which has subsequently been devalued. Tesco have taken the brave decision to write this off over the short term instead of devaluing the assets over a longer
…show more content…
Tesco see the biggest reduction – with decreasing Trade Payables and a significant reduction in short term borrowings between 2012 and 2013.
Tesco’s Non-Current Liabilities have decreased by £535 million from 2009–2013. This supports comments in the Tesco’s 2013 financial report in which the financial director highlighted his aim to reduce net debt significantly over the medium term. However closer inspection shows a rising trend from a low in 2011. Sainsbury’s Non-Current Liabilities on the other hand shows a relatively steady but manageable increase. Both can attribute the majority of these rising trends to increases in ‘post employment benefit obligations’ (pensions) and

Related Documents

  • Decent Essays

    Viacom Growth Strategy

    • 761 Words
    • 4 Pages

    Another decrease the balance sheet displays, is liabilities and shareholders equity. It reached a meager 22.22 billion in 2015, the first time it had dipped below 23 billion in the past years. The common equity of Viacom dropped more than five billion dollars, accumulating just 3.54 billion. Likewise, their total equity dropped to 3.82 billion, more than 4 billion less than it had been in 2011. Their retained earnings increases substantially, however.…

    • 761 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    Higher the EPS, better for the company. POSCO has maintained an acceptable EPS from 2004 to 2011 which can be seen from the graph above. The EPS of 2012 showed a decline when compared to the previous year due to a decrease of net income by USD 887 million in 2012 when compared to 2011’s net income. Similarly, EPS reduced further in 2013 due to a decrease of nearly USD 986 million when compared to 2012’s net income. Decomposition of ROE – DuPont Analysis DuPont analysis decomposes ROE into the following three…

    • 995 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    CHINA INDUSTRIAL PRODUCTION Industrial production in China rose 5.90 percent year-on-year in December of 2015, slowing from a 6.20 percent increase in the previous month and missing market expectations of 6.0 percent growth. Manufacturing sector expanded the most by 7.0 percent, followed by mining. In contrast, electricity, heat, gas and water production and supply declined by 0.8 percent. From January to December 2015, industrial output rose 6.1 percent. On month-on-month basis, industrial output grew 0.41 percent.…

    • 935 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    As consumption spending and business investment dried up, massive job loss followed. The US labor market lost 8.4 million jobs, about 6.1% of payroll employment. Some 46.2 million Americans lived below the official poverty level in 2010, which is about 15.1 percent of the population. The number of people living in poverty grew by 27 percent between 2006 and 2010. Poverty increased greatly among the Hispanics and African Americans, households of women, and working class adults between the ages of 18-34.…

    • 1857 Words
    • 8 Pages
    Decent Essays
  • Decent Essays

    Rroton Ratio Analysis

    • 1293 Words
    • 6 Pages

    In 2013, the positive trends in some ratios are reversed. The growth in EPS is interesting given the profit margin is decreasing from 2012 to 2013.The EPS has gone from 60.77 cents in 2011, 60.99 cents in 2012 to 67.15 cents in 2013. It must be remembered the revenue is increasing during the three years. Consequently, any ratio that involves the number of revenue in the dominator will increase all else being equal. the gross cash flow per share is higher than the EPS, but the gross cash flow per share may not be restricted to operating cash flow only.…

    • 1293 Words
    • 6 Pages
    Decent Essays
  • Decent Essays

    Swot Analysis Of Mlb

    • 966 Words
    • 4 Pages

    Although they are down by $1 million same quarter 2014. HRB has managed to make an improvement with the long-term-debt. In 2013 HRB long-term-debt topped off at $905.4 million dollars and they’ve diligently decreased their long-term-debt by 0.1% from 2014 to 2015. Using the debt/equity ratio we rationalize that as of the close of fiscal 2015 HRB carries a 0.28% debt-to equity percentage signifying they have the ability to balance debt and pay notes without stressing the balance sheet. The debt-to-equity ratio of 1.44 exhibits their ability to thwart short-term cash flow issues.…

    • 966 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    Be Our Guest Case Analysis

    • 1591 Words
    • 7 Pages

    This decrease in net earnings is due in great part to the 120% increase in general & admin. salaries. Be Our Guest, Inc.’s ROE decreased 53% over the four- year span, from 33% to 16%; net earnings and total equity affect this decline. As mentioned, the net earnings decreased 37% from 1994 to 1997, due to greatly to operating expenses such as general & admin expenses; whereas, the total equity increased 34% from $420,000 in 1994 to $562,000 in 1997. The total equity increased, which is a direct result of the 41% increase in retained earnings.…

    • 1591 Words
    • 7 Pages
    Decent Essays
  • Decent Essays

    Despite the tremendous challenges we faced during the year, the Company’s net profits after AFS portfolio, amounted to KD 43.9 million (US $ 146 million), declined by 16% compared to the previous year. This decline of the Company’s profits in 2015 is mainly due to the adverse factors and economic turbulence and events in the markets in which the Company…

    • 1415 Words
    • 6 Pages
    Decent Essays
  • Decent Essays

    Simeon Case Study

    • 966 Words
    • 4 Pages

    Therefore , the efficiency of inventory management for Simeon Company is decrease. 4 Days’ sales in inventory =( Ending inventory)/(Cost of goods sold ) X 365 2009 $82,500/($345,500 ) X 365 = 87.16 days 2010 $112,500/($411,225 ) X 365 = 99.85 days The days’ sales in inventory is increase from year 2009 , 87.16 days to 2010 ,99.85 days. Therefore ,the liquidity of inventory for Simeon Company is decrease. 5 Account payable turnover = Cost of goods sold Average account payable…

    • 966 Words
    • 4 Pages
    Decent Essays
  • Decent Essays

    1. Looking at Revance Therapeutics and Radius Health’s stock pricing performance show that Revance has had some miscalculations whereas Radius has grown to what it is now. Revance Therapeutics started at a $21 stock price and are currently at years end for 2016 at $21.25. The company started with a high stock price which immediately dropped and stayed low for their first year however over the span of three years they have been able to rise their price back to just above their starting price. However looking at Radius they hit the market with a lower stock price of $8 and over three years their stock prices have consistently increased.…

    • 1265 Words
    • 6 Pages
    Decent Essays