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).

May be its time for me to exit Tesco before the possibility of the Summer sell off.

http://www.dailymail.Tesco-set-unveil-eye-watering-4bn-loss-boss-Drastic-Dave-Lewis-rolls-turnaround-plan.

Tesco to plug pensions black hole

By Giles Gwinnett
April 21 2015, 6:39pm
Wednesday's agenda - Tesco's pending full year results divides opinion


Supermarket supertanker Tesco (LON:TSCO) reports final results and the numbers are sure to be closely scrutinised, though what they will be has opinion divided.

It's been a rough couple of years for Britain's largest grocer, blighted with falling profits and accounting scandals, but recently the green shoots of improvement have been visible.

Earlier this month, Kantar, the market researcher, said in the 12 weeks to March 29, Tesco sales were up 0.3% to £7.1bn.

But there's no doubt that new man at the helm Dave Lewis certainly has his work cut out for him as he attempts to re-build the group's balance sheet and rebuild shareholder value.

Most commentators believe the results will paint a dismal picture Wednesday though HSBC has gone against the grain.

The international bank has a "buy" recommendation on the shares and a target price of 295 pence, which is a long old way from the current price of 234.75p.

The bank reckons despite a period of huge under-performance, sales growth has been catching up with the industry and it is no longer losing significant market share.

Others expect the results to be the worst in 96 years, with some predicting the loss for the year to be up to £5bn.

Other black holes to look out for are said to include the pension deficit, property writedown, and supplier fees.

Pension problems dominated news on Tuesday with the retailer kicking off consultation with its 300,000 about the future of their pensions. The deficit has been estimated at £5bn.

US broker Citi rates the shares 'neutral' targeting £2.35 - up from £1.90.

The broker expects £1,840mln net ‘retail’ operating cash flow for FY14/15 - around 50% lower than last year and assumes a £4.5bn pension deficit at year-end.

Preliminary Results

PRELIMINARY RESULTS 2014/15

· £1.4bn Group trading profit, in line with expectations
· UK like-for-like sales volumes up for first time in over four years, driven by better availability, service and pricing; like-for-like sales performance improved to (1.0)% in Q4
· Significant reduction in UK trading profit, as previously announced
· Tough trading conditions overseas, especially in Korea; disappointing performance in Europe
· Transformation programme outlined in January progressing well; portfolio review ongoing
· £(7.0)bn one-off charges, predominantly non-cash; includes £(4.7)bn fixed asset impairment, reflecting challenging industry conditions and profit decline
· Pension deficit funding plan agreed with Trustee, comprising cash contributions of £270m per annum
· No final dividend, as previously announced
· Enhanced disclosure, including property valuation/ownership and commercial income
· Reiterating commitment to reinvest any savings or outperformance into further improvements for customers

An eye watering 6.4 billion loss, certainly not going to be the Tesco we know today for the future. Will drastic Dave survive ?

Bankruptcy a possibility?

Ha Ha! Not even a remote one.

Whatever their woes, it is generally considered they can trade out of it - even if it needs some kind of massive re-financing just to boost the balance sheet with cash.

And they don't seem to want any of that kind of medicine.

For the moment, the board are being supported as Dave clears the decks. In fact, I guess now we can just about believe, that there is maybe not even an ounce more of any bad news.

Or can we? I'm not exactly sure what I've just said means the shares are a 'buy'. The market itself is a bit toppy and wobbly and there's also the uncertainty of the Election.

No dividend - so I was out at 239p

Tesco are in serious trouble with Net debt now standing
at £8.4bn, while Tesco’s total indebtedness - the amount it is contractually obliged to pay in rent and its pension deficit – totals £21.7bn.


Mind you the Titanic could never sink Harry, I would not be so sure.

HARRYCAT - 22 Apr 2015 13:56 - 1443 of 1445
Ha Ha! Not even a remote one.

Five reasons why investors shouldn't panic over Tesco's huge losses

Graham Ruddick says Tesco is already showing signs of recovery despite bottom-line loss of £6.38bn for the year to February 28 - the worst in its 96-year history

They will survive by selling off assets, living for today. But as said many times the discounters are not sitting still. They are opening stores on a weekly basis, with more pressure mounting. Just read Tesco may have to close 200 stores. Sadly the pressure will never end. Drastic Dave will eventually be forced into a rights issue, just hope there will be assets left. The discounters are going to make them look like a corner shop.

However analysts believe that the discounters have reached their limit and are starting to level off. As the threat of recession recedes, shoppers will migrate from the base market to better stores, so it may well be that Aldi, Lidl etc are going to have to consider their options when faced with a more demanding shopper.

The problem being that the food being supplied by the discounters is in many cases and proven award winning. Just how many will switch back? Not so straight forward in my view. In many cases the food is equal, if not better. I'm sure the big range rovers , bmws etc are not going to our local Aldi and loading up with junk. Its the old principal of they are not going to be ripped off.

Tesco-boss-pressure-sales-stumble-market-share-takes-dip.

That's the problem - Lidl saw sales grow 8.8pc and its market share reached a record of 3.9 per cent, up from 3.6 per cent last year. Aldi also grew sales by 15.7 per cent, taking its share to 5.4 per cent of the market.

Probably a dead cat bounce but worth risking a wee punt, long on the spreads @213p tight stop.

I'd settle for 240p atm!

Deutsche Bank Buy 208.65 208.65 275.00 240.00 Reiterates

Aldi-surge-goes-snaps-heels-Britain-s-five-supermarkets