TESCO PLC (TSCO)

TESCO PLC (TSCO)

Blog posts

Justin King ex-Sainsburys CEO – Supermarket Supply Chains, Profits and Share Prices

In the present environment its useful to get some insights into what’s happening in the food retail sector and how it's impacting the major players. I came across this 10 minute interview with Justin King which was filmed at the end of March and thought it may be of interest to members. Justin King, Formerly CEO of Sainsbury's and now an advisor to Supermarket Income REIT (LON: SUPR), answers a series of questions for the investor community. Justin discusses the supermarket sector. ...

Supermarket Winners and Losers – Ocado, M&S, Waitrose, Sainsburys and ASDA

As a recent purchaser of Ocado (OCDO) shares I have received the notice of a General Meeting to approve the deal with Marks & Spencer (MKS). The agreement is the formation of a new joint venture and will effectively replace the previous partnership with Waitrose (part of John Lewis) to provide own-brand products. This looks a very positive deal for Ocado if you read the detail as the Waitrose deal was restrictive in some regards and Waitrose has also been developing ...

Acquittals Over Tesco Fraud

Yesterday (6/12/2018) was another sad day for those who would like to stop false accounts being published by public companies. Two former executives of Tesco who had been charged with their involvement in the inflating of Tesco’s profits by including supplier credits were discharged by the court on the basis that they had no case to answer. The judge, Sir John Royce, said the case was so weak that it should not be put to a jury. It appears that the problem ...

Tesco Investor Compensation and Booker Opposition

Tesco (TSCO) have agreed a Deferred Prosecution Agreement with the Serious Fraud Office (SFO) over the overstatement of profits which came to light in 2014. Tesco has also conceded to a finding of market abuse by the Financial Conduct Authority (FCA) in relation to a trading statement issued in August 2014. As a result the company has agreed to establish a compensation scheme for purchasers of Tesco's ordinary shares or bonds between the 29th August 2014 and 19th September 2014 (inclusive). ...

Tesco Fraud Charges, Cattles and Globo

The Serious Fraud Office (SFO) has charged three former managers of Tesco in relation to the overstatement of profits that occurred over several years and which came to light in 2014. The charges are fraud and false accounting and those charged are Carl Rogberg (finance director at the time), Christopher Bush (UK Managing Director) and John Scouler (UK Commercial Director). The former Chief Executive, Philip Clarke, has not been charged but is apparently still under investigation in relation to the offences. Neither ...

Brexit Result Impact and Tesco AGM

The result is in, and the people have spoken. We will now leave the EU, unless of course there is some more re-negotiation or other fudge which would probably require some U-turns by politicians. They are of course adept at finessing such manoeuvres so don't be surprised if the outcome is not quite as simple as it might first appear. The pound has already fallen substantially (I am writing this just before the stock market opened). Is that a disaster? Not quite ...

Tesco Results and Elementis AGM

Tesco (TSCO) and Elementis (ELM) - two very different companies. The first announced their preliminary results this morning, and the second held their AGM today which I attended. The opening line of the Tesco announcement says  it all: "It's has been a very difficult year for Tesco". Although it said like-for-like sales volumes were up for the first time in four years, the rest of the commentary was pretty negative and of course there will be no final dividend. Debts are rising, pension ...

2014 Review and New Year Resolutions

Now's the time of year to look back on the performance of the stock market in 2014, and look at plans for the future. Last year was undoubtedly a disappointing year for the UK stock market. The FTSE All-Share index was down 2.45%, worse than many other major markets. The cause was undoubtedly that the All-Share index is dominated by large mega-cap FTSE-100 companies such as BP, Shell, Glaxo and Tesco. The first two have been badly hit by the decline ...

Tesco Legal Action – or should we just “put our hands up”?

Law firm Stewarts Law has announced that it is preparing a case against Tesco based on the losses of investors in the company from the overstatement of profits. To quote from their announcement: "The Claim will allege that directors and senior management knew or were reckless as to whether Tesco's statements to the market were untrue or misleading and/or dishonestly concealed the true position, in breach of the Financial Services and Markets Act". They don't intend to await the results of ...

Tesco and why ShareSoc members should not have been surprised

After we published some previous comments on Tesco, Warren Buffett publicly admitted that his investment was a "huge mistake". He currently has about a 4% stake in the company, and may have lost over $800 million at the current share price after first buying it in 2007. It's perhaps worth reminding ShareSoc members and others of the fact they could have read a report on the Tesco 2013 Annual General Meeting in June 2013 which spelled out some of the problems the ...

Sainsbury and Tesco (do they need a pressure group?)

Following on from the debacle at Tesco, Sainsbury produced some quite awful trading figures yesterday (1/10/2014). Here's a review of some of the news on those and other retailers. Tesco The Financial Conduct Authority (FCA) are undertaking an investigation into Tesco's "overstatement of expected profit". Making misleading statements to the market is potentially a criminal offence. How long that will take to reach any conclusions is anyone's guess. The result of such investigations are often reported to investors so late in the day ...

The Tesco Board – fit for purpose?

There was a very good article in the Financial Times today by Luke Johnson. It covers the problems at Tesco and suggests that "the stewardship at Tesco has been woeful".  A particular focus is on the experience of board members, of which only one is executive (recently appointed Dave Lewis). It says "Like every single other director on the main board, he has no executive experience as a retailer whatsoever". Luke suggests they might have a wide and impressive set of ...

Barclays, Tesco and MoPowered

Barclays, Tesco and MoPowered - two big companies and one a typical new AIM company which has yet to show it can make a profit - but all three are under the weather in the last couple of days. Barclays have today (23/9/2014) been fined £38m by the Financial Conduct Authority for failing to ensure that clients money in the investment bank was kept separate from the banks own assets. When I joked in my local Barclays Bank this morning that I ...

Terry Smith demolishes Tesco

Terry Smith, CEO of Fundsmith, did a great job of demolishing the business of Tesco yesterday in the Financial Times (FT Money 6/9/2014). He explained why he won't be buying Tesco even though the shares have fallen to a level that equals what it was in 2003 and investors have been imploring him to buy it. Even though Warren Buffet has owned some shares in Tesco of late, he quotes from Mr Buffet's 1979 letter to shareholders thus: "The primary test of ...

Tesco admits it needs a new leader

Today Tesco announced that CEO Philip Clarke is departing. The statement included a further profit warning which mentioned that the overall market is weaker and trading profit in the first half of the year is below expectations. It's surely an acceptance that Mr Clarke had been given long enough to turn around the business, but had ultimately failed (he has been in the CEO role since March 2011). The new CEO is to be Dave Lewis who joins from Unilever where he has ...

How many corporate jets does Tesco need?

How many corporate jets does Tesco need? Four is the answer apparently. Every little helps (sic) as is their motto no doubt. The cost of these aircraft has actually risen in recent years and the expenditure on them was £8.9m last year. In addition the company has established a new "corporate" office in the West End of London for meetings rather than have directors travel to Cheshunt (that's just north of London for those who don't know). One has to ask whether they have ...

AGM Reports

Tesco (TSCO) AGM Report 2013 (Latest Tesco offers – 2 for the price of 3, and Nigerian Guinness)

Yes you can learn a lot from going to AGMs, and the above is some of what you can now buy in Tesco according to shareholder comments at today’s Annual General Meeting (AGM) of the company. Readers do not need reminding that Tesco has had a set of quite dire results recently. To quote Investors Chronicle in their review of last year’s figures: “Tesco’s figures are dismal…..”, but the figures in the Interim Management Statement were also poor. The prospective p/e is ...