4th December 2016

29th November 2016 – Tesco 20-year Value Performance



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FOR IMMEDIATE RELEASE

 

TESCO 20-YEAR VALUE PERFORMANCE SHOWS COMPANY’S NON-UK ACTIVITIES ACHIEVED ECONOMIC LOSSES OF £6.1bn

London – 29th November 2016. vysyble today announces the publication of Tesco plc – A Contrarian Shareholder Value Perspective’.  This is an examination of the financial and economic performance of the company from 1995 onwards with a focus on value creation and the achievement of economic profit.

The 24-page report assesses the company’s performance against its own strategic objectives and direction.  Central to this enquiry is the metric, economic profit – a measure which combines information from the profit and loss account and the balance sheet and therefore considers all the costs of doing business.  It is a metric which has been used by some of the world’s truly great value creators – for example; Coca-Cola under Roberto Goizueta, Gillette under the leadership of Jim Kilts and Lloyds Bank when the great Brian Pitman was at the helm. This measure provides a true reflection in the creation or destruction of value within club balance sheets.

Roger Bell, author of the report, commented: ‘Retail and the media is fixated by like-for-like sales which is a misleading measure. The transparency afforded by calculating economic profit and thus value creation gives rise to a clear perspective in terms of what has been a turbulent period in Tesco’s fortunes. From our calculations, Tesco has destroyed £6.4bn during the period of analysis from non-UK operations, which demonstrates that international expansion has been a highly challenging pursuit in terms of strategic and economic value.’

The report also investigates the company’s management performance against value-based criteria such as total shareholder return together with a detailed analysis of the company’s economic performance against the company’s own strategic objectives.

vysyble is an insights and business information provider. We help businesses understand the world with trends, data and insights via detailed reports and graphical outputs covering a wide range of industries, sectors and individual corporate entities.

 

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