Member Article

Tesco announce £6.4bn losses after ‘deterioration’ in the market

In what has been the worst year on record for Tesco, the company has announced £6.4bn in losses.

Tesco said that the market has detoriated and that its competitiveness has eroded

It blames some of its poor financial results on tough trading conditions overseas, especially in Korea and bad performance in Europe.

Tesco has closed 43 unprofitable stores and is restructuring its head office in an attempt to improve its finances.

The results mark a difficult year in which Tesco is still being investigated by the Serious Fraud Office for overstating its profits by an estimated £263m.

Chief executive, Dave Lewis said: “It has been a very difficult year for Tesco.

“The results we have published today reflect a deterioration in the market and, more significantly, an erosion of our competitiveness over recent years.

“We have faced into this reality, sought to draw a line under the past and begun to rebuild, and already we are beginning to see early encouraging signs from what we’ve done so far.

“Over the last six months we have put customers back at the centre of everything we do.

“By focusing on the fundamentals of availability, service and targeted price reductions, we have seen a steady increase in footfall, transactions and, most significantly, volumes.

“More customers are buying more things at Tesco.

“We are making deep changes to the way we organise and run our business, with a simpler, more agile office team, more colleagues serving customers and a new approach to the way we work with suppliers.

“I do not underestimate how difficult some of these changes have been for the team and I thank everyone for their professionalism and contribution at this time of great change.

“The market is still challenging and we are not expecting any let up in the months ahead. When you add to this the fundamental changes we are making to our business and our offer, it is likely to lead to an increased level of volatility in short-term performance.

“Our clear priority - and the one that will deliver sustainable value for our shareholders - is to improve consistently for customers.

“The changes we have made and will continue to make put us in a stronger position to do this.”

This was posted in Bdaily's Members' News section by Sophia Taha .