Operational and Financial Performance Analysis of Tesco

OPERATIONAL AND FINANCIAL PERFORMANCE ANALYSIS OF TESCO
Operational and Financial Analysis of TESCO
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2OPERATIONAL AND FINANCIAL PERFORMANCE ANALYSIS OF TESCO
Executive Summary:
This report analyzes and interprets the financial and operational performance of Tesco PLC.
Tesco PLC is having a large network of retail outlets dominating in groceries and food
products. For better understanding of their performance and competitive position in the
market, their operational and financial performance has been compared with the performance
of their competitor Sainsbury PLC. Different financial ratio helps in evaluating and
understanding financial performance of a company. For the users of financial information it
becomes easy to interpret the financial performance and financial position of a company
easily from certain financial ratios. Lastly, the paper concludes with some recommendations
to the management of the Tesco for improving their operational and financial performance
and gain more competitive advantage in the market.

3OPERATIONAL AND FINANCIAL PERFORMANCE ANALYSIS OF TESCO
Table of Contents
Introduction:...............................................................................................................................4
Brief overview of the Company:................................................................................................4
Overview of the Market Structure:............................................................................................5
Analysis of operational activities of Tesco PLC:.......................................................................5
Ratio Analysis of Tesco PLC:....................................................................................................6
Profitability Ratios:................................................................................................................7
Liquidity Ratios:.....................................................................................................................7
Leverage Ratios:.....................................................................................................................8
Efficiency Ratios:...................................................................................................................9
Comparative analysis of Financial and Operational Performance of Tesco PLC with
Sainsbury:...................................................................................................................................9
Revenue generation:.............................................................................................................10
Profit before tax:..................................................................................................................10
Return on Assets:.................................................................................................................10
Comparison of operational performance:.............................................................................11
Conclusion:..............................................................................................................................11
Recommendation:....................................................................................................................12
References:...............................................................................................................................13

4OPERATIONAL AND FINANCIAL PERFORMANCE ANALYSIS OF TESCO