Ratio Analysis of Tesco plc: Financial Performance Evaluation

Introduction to Managing
Finance

Contents
EXECUTIVE SUMMARY.................................................................................................................................3
INTRODUCTION...........................................................................................................................................4
MAIN BODY.................................................................................................................................................4
Ratio Analysis...........................................................................................................................................4
Results of Ratio Analysis..........................................................................................................................6
Recommendations.................................................................................................................................12
CONCLUSION.............................................................................................................................................12
REFERENCES..............................................................................................................................................13
APPENDIX..................................................................................................................................................14

EXECUTIVE SUMMARY
Trading, banking, trading, spending, investing, and anticipating are all examples of financial
management. Financial management is the act of overseeing business earnings in such a manner
that it remains lucrative and adhering to all relevant legislation. This first need a high-level plan
as well as on execution. Any company wishing to expand must employ cash in such a way that
the dividend payments surpass the cost of borrowing. This report based on the Tesco plc which is
leading organisation of retail sector in United Kingdom. In this report analysis the ratio of the
company in order to know the actual financial situation in proper manner and get better results in
regard investments. This ratio analysis present company effective position in effective manner.

INTRODUCTION
Tesco plc, based in Welwyn Garden City, England, is a British - based grocery and
consumer products store. It is the third largest retail in terms of revenues earnings and indeed the
ninth-largest in terms of revenue growth. Jack Cohen created Tesco PLC in 1919 in London,
England. Cohen started selling food from a modest booth after coming from the war, making a
profit of £1 on sales revenue of £4. Tesco has been one of the nation's biggest supermarkets,
working approximately 530,000 employees and supplying millions of consumers every week
across 14 countries. Tesco's Core Aim is to work with each other to improve what important. It's
loyal to their origins, but it's much more applicable to present era and the type of firm they like
being. The main objective to analysis financial performance of company in 2019 to 2021 by the
ratio analysis. Along with present all the data information in regard of ratio analysis with charts
and identify the problems by the ratio. At the end of the report provide appropriate
recommendations for the effective changes in business.
MAIN BODY
Ratio Analysis
CALCULATIONS:
Tesco PLC
Input data for Liquidity Ratios: 2019 2020 2021
Current Assets 13,889 13,893 10807
Current Liabilities 8,395 4,763 5190
Inventories 2,617 2,433 2069
Cash 4,277 4,137 2510
LIQUIDITY RATIOS: 2019 2020 2021
Current Ratio 1.65 2.92 2.08
Current Assets/Current Liabilities
Quick Ratio (or Acid Test Ratio) 1.34 2.41 1.68
(Current Assets-Inventories)/Current Liabilities