FINANCIAL ANALYSIS

Financial Analysis of Tesco & Sainsbury

Introduction3

Question # One3

A. Background of Companies3

Overview of Tesco3

Overview of Sainsbury4

B. Financial Analysis of Underlying Companies4

Financial Ratios of Sainsbury5

1.Investor Ratios5

2.Lender Ratios5

3.Shareholders Ratios5

4.Supplier Ratios6

Financial Ratios of TESCO6

1.Investor Ratios6

2.Lender Ratios7

3.Shareholders Ratios8

4.Supplier Ratios8

C. Reporting Performance9

D. Recommendation9

Question # Two10

Financial Analysis of Tesco & Sainsbury

Introduction

This Report is aimed at explaining several financial concepts from a practical approach. Basically we have divided this assignment into two segments; first part deals with the analysis of two companies (Tesco & Sansbury), whereas in second part we are going to define what segmenting reporting actually is.

Question # One

A. Background of Companies

Overview of Tesco

Tesco PLC is the leading retailer in Britain. It is a global chain of retailing that has its basis in United Kingdom. It deals mainly in grocery and general items. The stores of Tesco in UK are categorized into six different categories, including Tesco Superstar, Tesco Extra, Tesco Metro, One stop and Tesco Home plus. Tesco in UK has the largest operations within all the countries where Tesco is present. Tesco has more than 3000 stores in UK alone, and it employs around 310,000 employees from UK alone. Likewise, UK alone has the most shares in the profits and sales of Tesco all over the world.

Tesco was the world's first online grocery retailer. It has around more than 2 million GBP sales right now from its online grocery section throughout the world. There are many exclusive services that Tesco's customers are entitled to, which include click & collect service, club card service and Tesco's talking shop. Tesco owns the two largest food brands in the entire UK, which are Finest and Everyday value with each having sales of more than GBP 1 million.

The purpose of this interim report is to present a sales plan for TESCO PLC which would be aligned with the company's overall strategy to go international (Anonymous 2013, p.n.d.).

Overview of Sainsbury

Sainsbury's was established in the year 1869 by John James and his wife Mary Ann Sainsbury; they opened their first store at Dury lane which was one of the underprivileged areas in London at that time and rapidly it became popular to offer excellent quality products at low prices. In 1882 Sainsbury launched its own product brand and it was bacon (J-Sainsbury's, 2009, pp 375). In 1914 it started employing women to help with colleagues shortages during the First World War. It initiated workshops, awareness and training programmes for colleagues in 1916 at Black fairs to guarantee their workers were the best trained.

During 1950's Sainsbury's was the first to initiate self service stores among their competitors bringing an end to long queue counters and they also introduced bakeries, fresh fish counters and petrol stations in the seventies and in mid seventies it entered into non food section market and opened first Sava centres.

B. Financial Analysis of Underlying Companies

Financial Ratios of Sainsbury

Investor Ratios

J Sainsbury has improved its current ration from 0.58 of 2011 to ...