Analysis Of X Ray Tesco : Financial Analysis

Evaluation 14 Conclusions and recommendation 15 References 16 Appendix 18 Appendix A: Methods and data 18 Appendix B: Ratio Calculations 19 Introduction The retail sector in the United Kingdom is essential for the economy, the company Tesco PLC currently corresponds to the biggest retailer in the UK (1) by revenue and it is one of the top five in the sector at the world level according to market capitalisation (2). Therefore, it would have been justifiable to consider Tesco as a safe investment. However, the company is now facing agency issues (3) which has concerned investors and has caused the company to lose 50% of its market share price. This report will analyse the financial performance of Tesco PLC in order to gain an insight of the company’s financial health. To understand this, the CORE method of approach (Context, Overview, Ratios and Evaluation) will be employed. Firstly, the Context of the company will be examined to see how macroeconomic conditions or external factors could have affected the performance of the company, for example, the financial crisis of 2008 or the current low (0%) inflation in the UK. Additionally, the internal financial perception within the company is studied from the financial annual report. The second part of this work aims to give an Overview by use of a SWOT analysis of the company throughout the last five years 2010 - 2014, for this horizontal and trend analysis techniques are employed referring to key values presented