Ratio Analysis of Tesco Plc Financial Performance between 2010 and 2014 in Comparison to Both Sainsbury and Morrisons

Abstract

Ratio analysis is a method of assessing and comparing the performance of a company in a particular year to previous years’ performance and possibly with other companies in the same industry. This paper aims at analyzing the financial performance of Tesco Plc between 2010 and 2014 and compares it with the performance of both Morrisons and Sainsbury. The paper intends to make use of financial statements of Tesco, Sainsbury and Morrisons from 2010 to 2014. From the data analysis, it is discovered that from 2010, the financial performance of Tesco Plc is not improving and the shareholders’ wealth has been decreasing. Not only that, the Gross Profit, Return on Capital Employed, Dividend payment, Share prices, etc. have been reducing from year to year. The consequence of this is that Tesco Plc may run into loss in the nearest future if not in 2015. The paper recommends that Tesco needs to adjust his business activities so as to improve its performance.