"Half-Year Results Indicate That Tesco Has Been "Rocked To The Core"
Tesco revealed that group like-for-like sales were down 4.4 per cent in the first half of the year, with group trading profit down a massive 41 per cent across the group, and by 55.9 per cent in the UK.
Tesco revealed that the Deloitte investigation into its profits overstatement earlier this year has now been completed, confirming that profits were overstated by £263 million, £118 million of which refers to the first half of this year. Tesco chairman Sir Richard Broadbent has also confirmed he will step down from the retailer.
“This morning’s results show how retail giant Tesco has been rocked to the core by the accounting scandal, with a string of key executives now on the suspended list and every painful twist and turn gleefully documented by both specialist and mainstream media," said David Gray, retail analyst at Planet Retail. "Not that they are wanting for material, either. Like-for-like declines in almost all markets – including the UK – are now the norm for a company that seems bereft of any solution that might arrest its vertiginous decline."
Shore Capital's Darren Shirley said that "Tesco has had quite a few years of challenge and disappointment. However, we can never recall a period so damaging to the reputation of the company as H1 FY2015. That a powerhouse of international retailing was reduced to a rudderless corporate entity where downgrade followed downgrade, executive followed executive out of the business, with no effective succession planning, capped by a material accounting issue, reflects to a detrimental extent, to our minds, upon those who are the guardians of Tesco on behalf of its owners."