Tesco is one of the worlds leading international retailers. Since the company first the trading name of Tesco, in the mid 1920s, the group has expanded into different formats, different markets and different sectors. The UKs leading retailer Tesco was floated on the stock exchange in 1947 and in 1995 took over rival Sainsburys position as the UK number one. The principal activity of the group is food retailing, with over 2,000 stores worldwide. Tesco has a long term strategy for growth, based on four key parts: growth in the Core UK business, to expand by growing internationally, to be as strong in non-food as in food and to follow customers into new retailing services. The company launched a home shopping service in 2000, allowing customers to order their shopping online. Tesco is now expanding its convenience stores and overseas into areas such as Taiwan, Malaysia, Poland, the US and Ireland.

Upper graph = 12 month share price with 6 month moving average
Lower graph = 12 month volume (red line = volume average).

Still overvalued by 30% imo.

Oooooooooooooh! Handbags are out!

Just in from Sainsbury's:

From 2 October, your Brand Match coupon will just compare our prices and deals on brands with Asda.

Tesco will no longer be part of Brand Match.

Visit the Customer Service Desk in store or sainsburys.co.uk/brandmatch for more information.

From: http://www.ft.com/cms/s/0/2407849a-44cc-11e4-ab0c-00144feabdc0.html?ftcamp=published_links%2Frss%2Fhome_uk%2Ffeed%2F%2Fproduct

September 25, 2014 6:30 pm
Ashley’s gamble on Tesco divides opinion in the City
By Andrea Felsted, Senior Retail Correspondent

Newcastle Chairman Mike Ashley gives the thumbs up during the Barclays Premier League match at St James' Park, Newcastle. PRESS ASSOCIATION Photo. Picture date: Saturday September 20, 2014. See PA story SOCCER Newcastle. Photo credit should read: Owen Humphreys/PA Wire. RESTRICTIONS: Editorial use only. Maximum 45 images during a match. No video emulation or promotion as 'live'. No use in games, competitions, merchandise, betting or single club/player services. No use with unofficial audio, video, data, fixtures or club/league©PA
Mike Ashley, the billionaire retailer who likes a flutter, is taking a punt on Tesco.
Mr Ashley, who owns 58 per cent of Sports Direct, has entered into a derivative deal that gives him an interest in the fate of the struggling supermarket chain, just days after it announced that it had overstated first-half profits by £250m.



Even as other shareholders are taking flight, Mr Ashley is betting that the supermarket’s shares are oversold.
Sports Direct has sold a put option that gives Goldman Sachs the right to sell 23m Tesco shares to Sports Direct if they fall below a certain undisclosed exercise price, or receive an equivalent payment. If the shares are trading above the agreed price on the contract’s expiry, Sports Direct receives an undisclosed premium from Goldman.
Mr Ashley is no stranger to these kinds of transactions. In January, he entered into a similar deal with Goldman that could give him a 6.6 per cent stake Debenhams if its shares fall significantly.
Ashley and the Sage

Warren Buffett
Although it’s unlikely Warren Buffett ever got wild in Nottinghamshire, the legendary investor does share one similarity with Mike Ashley: they both like to sell puts.
See below
These kinds of arrangements, because they are of a relatively small size, do not require shareholder approval at Sports Direct.
But Mr Ashley’s share deals have raised eyebrows in among some investors and analysts who complain that Sports Direct should not be engaging in the sort of activity that is more commonly found in a hedge fund.
“I think people would rather Mr Ashley do something more conventional than potentially losing money punting on Tesco,” says Nick Bubb, the independent analyst.
But others say there is a clear strategic reason for Mr Ashley to take an interest in both retailers – Sports Direct could benefit from more access to their stores.
Since the bet on Debenhams, the department store chain has started operating a trial of Sports Direct concessions in two stores – Harrow and Southsea – and said it will possibly expand this further before the end of the year.
Chart: Mike Ashley's derivative bets
Sports Direct already has a relationship with Tesco. The supermarket leases space to Sports Direct inside eight stores in central Europe and four in Malaysia. Tesco also leases 11 UK store buildings to the sports goods retailer, but these are either beside existing Tescos or at sites where Tesco has closed a store.
The FT revealed last year that Sports Direct was in talks with Tesco to take space inside some of its large stores. However a deal has yet to come to fruition.
According to people familiar with the situation, there are three strands to Sports Direct’s interest. The first is taking excess space in Tesco stores to create Sports Direct concessions. Secondly, it could sell some of its products directly through Tesco stores. Finally, Tesco’s non-food online platform – Tesco Direct – already sells products for third parties, including House of Fraser. Sports Direct products could also be sold through Tesco Direct.
According to Jonathan Pritchard, analyst at Oriel Securities, the financial risk for Sports Direct is limited, and closer ties with Tesco would give it the potential to reach the millions of people who still shop at the UK’s largest supermarket chain.
For Tesco, the intervention could well be a mixed blessing.
As well as his already hefty to do list, new chief executive Dave Lewis now has to deal with Mr Ashley.


Chart: Fewer investors shorting Debenhams and Tesco

But Mr Lewis also has a ready made candidate to take some of the excess space in Tesco stores off of his hands. The arrangement with the sportswear retailer has already worked well in central Europe.
“Tesco have been very impressed with the footfall that Sports Direct drove to the stores in central Europe,” Mr Pritchard says.
Other retailers struggling with too much space, such as DIY chain B & Q, might welcome Mr Ashley’s presence. “B & Q would bite his hand off for this,” says Mr Pritchard.
Partly as a result, Mr Ashley’s new interest in Tesco is being interpreted in very different ways from his first put option on Debenhams.
The first put was widely regarded as an aggressive move, as analysts speculated that Sports Direct, with a market capitalisation of about £3.8bn could be looking to buy the department store chain, which has a market capitalisation of about £850m.

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But Sports Direct’s announcement of the Tesco put was openly supportive of the supermarket chain. The bet involves less than 0.3 per cent of the company’s shares and the group’s market capitalisation of nearly £16bn dwarf’s Mr Ashley’s group.
In addition to the two derivatives deals, Sports Direct has taken an 11 per cent stake in House of Fraser, which it has retained, despite the department store chain agreeing to be acquired by Chinese conglomerate Sanpower.
“He’s a maverick,“ says Mr Bubb. “You have to take him warts and all. Sports Direct is a great business, and sometimes he can be very clever. But sometimes he oversteps the mark.”
Mike Ashley’s puts and his links to the Sage of Omaha
It seems unlikely that Warren Buffett would have stripped to Tom Jones’ ‘You Can Leave Your Hat On’ in a Chinese restaurant in Nottinghamshire. But Mike Ashley, who did just that three years ago, does share one similarity with the Sage of Omaha. He likes to sell puts, writes Joseph Cottrell.
Sports Direct, the UK’s biggest sports retailer, in which Mr Ashley owns a 57 per cent stake, said on Thursday it had sold a put option on 23m Tesco shares to Goldman Sachs.

Homecoming" September 18, 2014 in Detroit, Michigan. The purpose of the invitation-only event of Detroit expatriats is to give the group a chance to reconnect, reinvest and reinvent with their hometown. The topic of Buffet's conversation was, "Why I'm Bullish on Detroit." (Photo by Bill Pugliano/Getty Images)©Getty
Warren Buffett
The put allows the bank to sell the shares to Sports Direct if their value ends up below an agreed strike price on the expiry date. That would imply Tesco’s recent fall from grace as one of the world’s largest retailers – due to accounting failures, profit destruction in the UK – has further to go. Sports Direct would then be paying up for cheap shares (or, it could pay the option’s cash value).
But, if Mr Ashley took a (Buffett-like) view of long-term value, Tesco might eventually sort its problems, and rebound – at which point Sports Direct’s equity stake would rise in value. And if the shares rebound before expiry, Sports Direct’s upside is the premium on the option itself.
Put like that, it might seem a fair bet. But the minority shareholders who provide Sports Direct itself with equity may not have been in it for derivatives bets.
Neither the strike price nor the expiry have been disclosed. Still, Tesco’s share price closed on the day before the put’s disclosure at 195p, so 23m of them were worth almost £45m. According to Sports Direct, its maximum exposure is £43m – that is, in the unlikely event Tesco’s price went to zero and it had to buy worthless shares. If the closing price was the strike price, this suggests the premium is £2m.
But another figure to note is Sports Direct’s financial assets held available for sale for the year which ended in April: £117m. Thus, £43m is a large bet involving a stake in Tesco that at 0.3 per cent, would confer little ownership control if it passed into Sports Direct’s hands.
Contrast Mr Buffett. Berkshire Hathaway’s best known put sales were made between 2004 and 2008, with long-term options on global equity indices. Berkshire shareholders know that they own an insurer and investment company, with a large ‘float’ of insurance premiums with which to fund such trades. Whereas Sports Direct – stripped down – sells sports kit.
Former Merrill Lynch banker behind Sports Direct’s deals
The mastermind behind Sports Direct’s derivative deals is New Zealand-born investment banker Jeff Blue, writes Andrea Felsted.
As Sports Direct’s strategic development director, Mr Blue in January advised the retailer on its purchase of shares in Debenhams. Days later, Sports Direct sold the stake at a £5m profit and entered into a derivative deal that could see it acquire an almost 7 per cent stake in the department store chain if the shares fall.
He has now helped Sports Direct take a punt on Tesco shares, by selling a put option to Goldman Sachs in relation to 23m shares in the crisis-hit supermarket chain.
The former Merrill Lynch banker, 43, has a long history with both Debenhams and Sports Direct’s controlling shareholder Mike Ashley. While at Merrill, he presided over the stock market flotations of both retailers in 2007. He also worked for Baugur, the Icelandic investment group whose UK arm went into administration.
Mr Blue left Merrill in April 2007 to join Baugur as head of retail, where he oversaw its £9.8bn retail portfolio. In February 2009, BG Group, the UK division of Baugur, went into administration.
Unfazed by the collapse, Mr Blue went on to set up a boutique financial services business – Aspiring Capital Partners – specialising in the European consumer and retail space.
His relationship with Mr Ashley was rekindled in 2010 when the billionaire sought his advice on a potential bid for outdoor goods specialist Blacks Leisure, in which Sports Direct had built up a 22.5 per cent stake. The bid was blocked by key supplier The North Face.
In 2012, Mr Ashley hired Mr Blue to lead Sports Direct’s deal activity.

regardless the above iis are off loading
gla

Don't get that gibby,
However, as I see it, this financial thingy means they (SD) believe TSCO shares will rise.
Nevertheless, we have yet to see the effect of offloading the TSCO US-operations ( which I though should have continued for a few years at least until the business finds its feet - as it were.)... this may be pricey.
The mis-statement of profits must surely lead shareholders to question the role of Auditors.... whilst I don't expect them to inspect every penny-piece, I'd hope they'd be rather curious over large figures -
Indeed, should they repay their fees from slept-though inspection periods?

TESCO INVESTIGATION INITIATED BY FORMER LOUISIANA ATTORNEY GENERAL: Kahn Swick & Foti, LLC Investigates Tesco PLC Following Announcement of $400 Million Overstatement of Profit Forecast & Accounting Errors

PR Newswire

NEW ORLEANS, Sept. 29, 2014

NEW ORLEANS, Sept. 29, 2014 /PRNewswire/ -- Former Attorney General of Louisiana, Charles C. Foti, Jr., Esq., a partner at the law firm of Kahn Swick & Foti, LLC ("KSF"), announces that KSF has commenced an investigation into Tesco PLC ("Tesco" or the "Company") (OTC: TSCDY).

Tesco, together with its subsidiaries, operates as a grocery retailer. The Company also provides retail banking, financial, and insurance services. KSF's investigation is focused on Tesco's September 22, 2014 disclosure that the Company is investigating the overstatement of its profit forecast for 2015 by approximately $408.8 million. According to the Company, its most recent profit forecast for fiscal 2015 was overestimated as a result of an accounting error related to revenue that was booked early and by delayed recognition of costs.

Following these disclosures, Tesco's stock dropped as much as 14%, or $1.68 per share, in intraday trading on September 22, 2014.

KSF's investigation is focusing on whether Tesco and/or its officers and directors violated state or federal securities laws.

If you suffered losses related to your investment in Tesco PLC or have information that would assist KSF in its investigation, you may, without obligation or cost to you, call toll-free at 1-877-515-1850 or email KSF Managing Partner Lewis Kahn (lewis.kahn@ksfcounsel.com).

About Kahn Swick & Foti, LLC

KSF, whose partners include the Former Louisiana Attorney General Charles C. Foti, Jr., is a law firm focused on securities class action and shareholder derivative litigation with offices in New York, California and Louisiana. KSF's lawyers have significant experience litigating complex securities class actions nationwide on behalf of both institutional and individual shareholders.

To learn more about KSF, you may visit www.ksfcounsel.com.

Contact:

Kahn Swick & Foti, LLC
Lewis Kahn, Managing Partner
lewis.kahn@ksfcounsel.com
1-877-515-1850
206 Covington St.

First of all I am not an investor, but I am on a customer advice panel that meets with managers every couple of months.

Like many companies I feel that Tesco set up the policy of these meetings with the sole intention of a PR stunt and nothing else.

After the first few meetings I and most of the other none Tesco members of the panel came to realise that although the local and area managers try their best to take note, suggestions and comments reach the top and are then filed away or more likely chucked in a bin.

The most regular suggestions are getting rid of the 3 for 2, 5 for 4 and other offers, and to reduce the price on individual items.

Also the continuing habit by all of the big 5 (Tesco are the worse from my research) of so called value offers being more than twice the price of the same items of half the size/weight.

As a person who always weighs up price and amount I am never caught out but many people, especially the elderly are, but for my part I hate that Tesco are trying to con me into buying so called value deals.

Until Tesco start listening to customers instead of just playing lip service, customer trust will not return and more customers like myself will be shopping elsewhere.

As said, not an investor but I hope for those who are, Tesco start listening to customers instead of just playing lip service because if they don't customer trust will not return and more customers like myself will be shopping elsewhere.

Won't post again unless questions asked.

greekman

I've never heard of one of these before.

It is not solely Tesco's because you say, "... I and most of the other none Tesco members of the panel..."

Can you please tell us more about this 'customer advice panel'?

Exactly what is its purpose?

Do most areas have one of these?

Does it have a specific name?

Why specifically do you attend? Do you get paid an attendance fee or expenses for attending or are you an 'altruist par excellence'? (Not that I mind but it would help me better understand why you bother with it if your input has zero effect and the group is composed of members giving exactly the same collective advice but to different supermarkets?????)

I just cannot get my head around this, you see.

We shopped at Tesco a couple of weeks ago and WITH VOUCHERS we had £30 worth of goods for £16. They said at the help desk that most people don't use the vouchers. However I'd rather they did reduce the individual item price and not have vouchers and deals which I believe is more honest trading.

At the current rate of depreciation, the Stock will be offered with Vouchers!!!!!

greekman

getting rid of the 3 for 2, 5 for 4 and other offers, and to reduce the price on individual items.

That's been one of my pet hates , for the single person if its fresh food ,you end up throwing most of it away. And also Tesco's sell buy dates can't be relied on. Another thing is the 100g per price is in klg's on a simpler product so it is not easy to workout the cheaper product

Hi ExecLine,

I was at a customer service desk in Tesco about 9 months ago, once again complaining about being charged more than the display price, when I was approached by a Manager who had been standing next to the customer service desk.

He asked me if I would be prepared to be a member of a panel that met every couple of months, he explained that the panel had been set up in order that customers could give their views/opinions, he also stated that he was asking me as I was obviously someone who spoke their mind.

Not sure how many are on the panel list, but the 3 meeting I have been to have consisted of a Manager, Assistant Manager, a Customer Liaison Officer and around 10 customers.

The meetings are held in store, last for around 1 hour, a very good buffet is put on with wine and beer, with plenty left to take home, we are not paid!

I will be attending the next meeting but only to see if anything changes, if it is still yet another round of listen but take no notice, I will tell them bluntly that it's a complete waste of time.

If you are interested, I suggest you ask at your local store as I was told that these panels run at other stores, but not sure if this applies to all of them.

Regards Greek.

OK, G. Thanks for telling me.

As understand it, lots of the '3 for 2' and 'BOGOF' deals and the like, etc, etc, are greatly financed by the suppliers. Although no doubt Tesco do shove their arms up their backs to make them do it. And then there are 'best shelf positions' and trials, loss leaders, market place positioning and tons of other 'screw the customer' scams.

I did feel sorry for Sainsbury's when an internal staff notice pushing staff to 'try to get just another 50p from each customer' was released into the public domain by a whistle blower just a few days ago. The media made a right meal of it, whereas this is how business has to work. A supermarket doesn't exist just for the good of its health:

old man buffet saying he made an error buying Tesco this morning is starting to have an affect gla

Supermarkets have become big-business because they cater for the rising aspirations of their local areas - just look at their effect on Petrol stations. This is because folks look only at the "headline price" and cheap petrol somehow off-sets their longer round-trip
.
However, as investors we've become used to increasing profits and the various "scams" they all run ( er, depending upon your viewpoint, naturally), are there to make more profit.


If you can't afford it, then be strong and buy the lower-priced item, is my motto.
IMHO Lidl and the like have raised their prices recently - their wines are an example where you can't buy anything that is "cheap" - admittedly they are probably below other Supermarkets, but I think (the Big five) should concentrate on filling their shelves with more-different products, rather than more-choice. If you want crisps, then having a whole aisle full of them doesn't make you spend more, only different. That difference means TSCO is carrying a lot of stock-capital, whereas they could increase their product ranges, esp. non-food..... since the Gov. is trying to reduce our food-intake!
Greekman pointed to Value-scams a while back and whilst there is much merit in his words, there are times when buying a smaller qty does save you money - a small bag of potatoes at £1 is better then a really large one at £2.50 - because a single-person will throw away the stuff when it goes off. In addition there is the suspicion that the big bag will contain a few "wrong-uns" to make the weight ( Ooops!).

What I object to is supermarkets that "Up the Price" for no reason - a change of packing is no excuse and often you will find the value-range repacked so it commands a higher price - one suspects that this is to remove the value-item which is a drag on profits.....but I'd argue that rich customers don't fine these bottom-shelf goods as they fly through towards the expensive items on their list. ASDA has doubled their Ketchup price, by substituting plastic for glass - now, glass is recyclable whereas plastic isn't - so I suspect they are paying more for no purpose.
Of course, it could be they will bring back the cheaper prices if enough folks can be bothered to complain . . . . but as Greekman hinted, one wonders if suggestion are filed in the bin, such is the arrogance of Managers while profits are rising.

I have no comment on TSCO profit-hole, other than to wonder if shareholders shouldn't ask Auditors to repay their fees - and maybe a few Dir bonuses likewise.
I'll get my coat.

Buy @13p is my advice.

Going to £1.50 imo

At 160 , they maybe under valued

Wonder how the NAV stacks up now with the Market Cap????

All that land and property.

You never know a cheeky bid could come in.

lol mitzy isnt that a tad high though? ;