News Worms
News Worms


Dividend return and credit rating hint bolster Tesco's recovery

Dividend return and credit rating hint bolster Tesco's recovery

In addition to the triumphant return of its interim dividend, group sales were up 3.3% to £25.2bn, marking Tesco's seventh consecutive quarter of higher sales.

Mr Lewis said: "We are continuing to make strong progress".

Tesco (TSCO) has announced its first dividend since it was plunged into crisis by the revelation of a £263 million black hole in its accounts, after a 27% jump in first-half profits.

Group operating profit before exceptional items in the 26 weeks to August 26 increased by 23.7 percent at constant exchange rates to 759 million pounds, compared with the same period a year earlier.

Overall, pre-tax profits rose to £562m from £71m (691.5% change) reported in the first half of 2016/17.

The last time this happened was in the 2014-15 financial year, weeks before Tesco became embroiled in an accounting scandal that saw it overstate profits by £326 million.

"It's a significant milestone in the recovery of the business and one which demonstrates the confidence we and the board have in our plans", he told reporters.

Tesco remains the largest of Britain's supermarket groups by a clear margin, having a market share of nearly 28% according to the latest industry figures.

It remains 'firmly on track to reduce our costs by £1.5 billion, generate £9 billion of retail cash from operations and improve operating margins to between 3.5% and 4.0% by 2019/20'.

Tesco agreed to pay a fine of £129m to the Serious Fraud Office earlier this year to avoid prosecution for its 2014 accounting irregularities scandal.

"Tesco appears most at risk" with only 65 percent of its 743 supermarkets in the United Kingdom within 2km of an Aldi or a Lidl which is the lowest percentage among the Big Four grocers, Credit Suisse said, as quoted by Sharecast.

Provisional results are due from the Competition and Markets Authority later this month and a final decision will come in December.

While the numbers and story behind Tesco at the moment looks encouraging, our view is that competition is here to stay and will be ramped up by the German discounters making the margin improvement targets more hard to achieve over time.

He said the secret of Lewis's success has been to work with fewer suppliers and then use the formidable buying power of the country's largest grocer to drive down prices.

follow

editors' picks

October 05, 2017
Ford's new "Team Edison" is all about electricity
Hackett and his executive team spent the summer reevaluating Ford's operations after former CEO Mark Fields was ousted in May. The same day, Ford announced it had formed an independent unit, dubbed Team Edison, to create a business case for EVs.

October 05, 2017
Nobel Prize 2017: Inventors Of Gravitational Waves Honoured With Award In Physics
Weiss won half the prize, with Barish and Thorne sharing the other half. Albert Einstein had predicted these ripples in space a century ago.

October 04, 2017
Why Jose Mourinho has left Luke Shaw out in the cold
The Portuguese worldwide made a then world-record breaking £80m move to Real Madrid after scoring 118 goals in all competitions in 292 appearances.

October 04, 2017
Putin Offers New Ambassador Condolences Over Las Vegas Shooting
One of his predecessors, Michael McFaul, left the post under a cloud after just two years in Russian Federation . Huntsman, who also served an ambassadorship under President George H.W.

October 04, 2017
Red Bull chassis now the best on F1 grid - Marko
Vettel, 28 points behind Hamilton in the title race, lost drive on his first flying lap. Vettel's title hopes have been dealt a severe blow for two races in a row now.

October 04, 2017
Tonight's the night for Twins!
The Twins offense played well in September as well, and they're a team we shouldn't take for granted going into the playoffs. The game of baseball revolves around series, around establishing over a number of games, which team is deeper and better.

October 04, 2017
Ricciardo revels in double Red Bull Malaysia podium, defends Vettel move
The Dutchman is already the F1's youngest ever driver to win an F1 race at the Spanish GP in Barcelona a year ago . Vettel's last win came at the Hungarian GP before the summer break, moving him 14 points clear of Hamilton.

October 04, 2017
Congress Lets Insurance Program for Poor Children Expire, Oklahoma to Lose $49M
Senate Bill 1827, or the Keeping Kids' Insurance Dependable and Secure (KIDS) Act of 2017, was introduced September 18 by Sen. The House Energy and Commerce Committee is also having a hearing on Wednesday to consider its version of the Senate bill.

October 03, 2017
Watson, Texans Blow Past Titans
Miller was asked why it seems like Watson is playing far more advanced than expected for a rookie. He ran the ball four times for 24 yards and one touchdown. "I would definitely think that".

October 03, 2017
Philippe Coutinho Makes Liverpool Promise After Failed Barcelona Transfer
Coutinho handed in a transfer request in an attempt to force the Merseyside outfit into reconsidering their position but the Reds held firm and refused to be talked into a transfer deal.