1、Annual Report and Financial Statements 2020 Serving shoppers a little better every day. Contents Strategic report. 2020 highlights .1 Chairmans statement .2 Group Chief Executives review .3 Strategic review .4 Our business model .6 Financial review .7 Key performance indicators .12 Principal risks a

2、nd uncertainties .13 Longer-term viability statement .19 Task Force on Climate-related Financial Disclosures .20 Little Helps Plan (LHP).21 Non-financial reporting statement and section 172 statement.23 Corporate governance. Chairmans letter .24 Board leadership and company purpose .25 Board of Dire

3、ctors .27 Executive Committee .31 Division of responsibilities .33 Composition, succession and evaluation .35 Nominations and Governance Committee.38 Stakeholders .40 Corporate Responsibility Committee .44 Audit Committee .46 Directors remuneration report .52 Directors report.65 Financial statements

4、. Independent auditors report .69 Group income statement .78 Group statement of comprehensive income/(loss) .79 Group balance sheet .80 Group statement of changes in equity.81 Group cash flow statement .83 Notes to the Group financial statements .84 Tesco PLC Parent Company balance sheet .148 Tesco

5、PLC Parent Company statement of changes in equity .149 Notes to the Parent Company financial statements .150 Related undertakings of the Tesco Group .155 Other information. Supplementary information (unaudited) .161 Glossary Alternative performance measures .164 Five-year record.170 Shareholder info

6、rmation .171 Visit for more information. 2020 highlights. Headline measures. Alternative performance measures (APMs) Measures with this symbol are defined in the Glossary section on pages 164 to 169. All measures reported on a continuing operations and 52-week comparable basis. Change shown at actua

7、l exchange rates. 2019 figures restated for adoption of IFRS 16 as explained in Note 1 and Note 37. (a) Excludes amortisation of acquired intangibles and excludes exceptional items by virtue of their size and nature in order to reflect managements view of underlying Group performance. (b) Diluted EP

8、S before exceptional and other items refers to diluted earnings per share from continuing operations before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements of financial instruments. (c) Net debt and Retail free cash flow exclude the

9、 impact of Tesco Bank. Our business was built with a simple mission to be the champion for customers. Thats as true today as it was when Jack Cohen first set out his East London market stall in 1919. Our core purpose is serving shoppers a little better every day putting customers at the heart of eve

10、rything we do and guiding every decision we make. (0.7)% 56.5bn (2019: 56.9bn) Group sales 13.5% 2,959m (2019: 2,607m) Group operating profit before exceptional and other items(a) 27.9% 17.92p (2019: 14.01p) Diluted EPS before exceptional and other items(b) (4.9)% 2,518m (2019: 2,649m) Operating pro

11、fit (18.7)% 1,315m (2019: 1,617m) Statutory profit before tax 1.3% 64.8bn (2019: 63.9bn) Statutory revenue (26.8)% 9.54p (2019: 13.04p) Statutory diluted EPS (8.4 )% (12.1)bn (2019: (13.2)bn) Net debt(c) 58.6% 9.15p (2019: 5.77p) Dividend per share 132.1% 2,063m (2019: 889m) Retail free cash flow(c)

12、 Statutory measures. 1Tesco PLC Annual Report and Financial Statements 2020 Strategic report After the year end, we also announced the proposed sale of our businesses in Thailand and Malaysia. This transaction, supported unanimously by the Board, will unlock significant value from an exceptionally h

13、igh-quality business, and allows us to further simplify and focus the Group. On completion, and subject to approval, we have taken the decision to return c.5bn of the proceeds to shareholders through a special dividend. CEO succession. In October 2019, we shared the news that Dave will leave the bus

14、iness later this year. The Board and I believe that Dave has done an outstanding job in turning the business around and reconnecting Tesco to its core purpose. The Board undertook a thorough succession process to find the best possible candidate and, as a result, we made the decision to appoint Ken

15、Murphy to take up the baton from Dave. Ken will bring to Tesco a wealth of experience, proven leadership in international retail businesses, a strong strategic mind and a track record in commercial and brand. What was very important to the Board in the recruitment process was that the new CEO would

16、be a good fit for the strong culture that we have developed. On behalf of the whole Board, I am extremely grateful to Dave for everything that he has achieved, and we look forward to welcoming Ken Murphy to the Board, and to Tesco, in October. John Allan Non-executive Chairman 7 April 2020 Chairmans

17、 statement A year of significant progress. This report covers our 2019/20 financial year, which ended on 29 February 2020. That year was one of significant progress, as we achieved our turnaround goals, further improved our business for customers, and firmly established ourselves on a strong financi

18、al footing. However, while the entire Tesco business has dealt with some serious challenges through the last five years of turnaround, undoubtedly the most significant of these occurred after our 2019/20 year end, with the global outbreak of COVID-19. As Dave reflects in his Group Chief Executives r

19、eview, our more than 400,000 colleagues have risen to the challenge incredibly, working day and night to ensure our customers have access to the food and essentials they need, in a safe environment. I cannot commend them highly enough for their efforts, which have been nothing short of inspirational

20、. The remainder of this report addresses, for the most part, the 2019/20 financial year - before the greatest impact of the significant changes that COVID-19 brought to our business, and indeed our society as a whole. Our priority is to keep an absolute focus on serving customers and to play our par

21、t in feeding the nation, as the situation with COVID-19 continues to dominate our current trading following the year end. Given these circumstances, we have included commentary on COVID-19 in this report where possible, while recognising that, at the time of writing, the situation is rapidly evolvin

22、g. For the latest updates on our response to the COVID-19 outbreak, I would encourage you to visit From turnaround to growth. In 2019/20, we marked the end of our turnaround. The management team set in 2015 and shared in 2016 a strategy to stabilise the business, to rebuild the brand, and to move to

23、wards the next chapter of growth. Guided by six strategic drivers, the whole Tesco team worked tirelessly to achieve these objectives and by October 2019, we had achieved every one of our turnaround goals. That momentum continued through this year, with full-year Group operating profit before except

24、ional items and amortisation of acquired intangibles up 13.5% to 2,959m. We now have a strong platform from which we can enter a new strategic phase, focused around earnings growth, cash profitability and cash flow, and with customer satisfaction at the heart. In June 2019, we hosted a Capital Marke

25、ts day, which set out untapped value opportunities for the Group, broadly categorised across three areas: growth, innovation and enabling technology. Highlights. Significant progress in the financial year ended 29 February 2020, as we marked the completion of our turnaround. Announced the proposed s

26、ale of our businesses in Thailand and Malaysia will release material value, and allow us to simplify and focus our business. Appointed a new Group Chief Executive, Ken Murphy, to succeed Dave Lewis in October 2020. 2Tesco PLC Annual Report and Financial Statements 2020 Other parts of our business ar

27、e stepping up too. Booker is supporting thousands of independent retailers in communities right across the UK, and Tesco Bank is providing critical services at a time of financial difficulty for many customers. It is impossible to present an exhaustive list, or to overstate how much has changed and

28、the extraordinary lengths the whole Tesco team has gone to in order to look after our customers. Recognising the incredible contribution of our colleagues, in March we announced a 10% bonus for front-line colleagues in the UK 12-week rolling data. (c) Reflects YouGov Brand perception measures of qua

29、lity and value on a 12-week rolling basis. (d) 14/15 data based on our 2014 What Matters to You survey and 2019/20 data based on our 2020 Every Voice Matters survey. (e) % of colleagues recommending Tesco as a great place to work. (f) The net promoter score for colleagues recommending Tesco as a gre

30、at place to shop. (g) % of colleagues agreeing that Treat people how we like to be treated is practised at Tesco (2014) and I feel I can be myself at Tesco without fear of judgement (2020). (h) % of colleagues agreeing that I can see a clear link between my work and the Tesco vision (2014) and The l

31、ink between my teams work and Tescos purpose is clear (2020). (i) Reflects % of UK the more our sales improve, the more we can reinvest in further improving the shopping trip. Channels To bring the best products to customers, we work through a range of channels from small shops to large shops, and o

32、nline. Booker gives us access to further channels, including Business Centres and delivered wholesale. Products We build close and mutually beneficial relationships with our supplier partners, to source the best possible products that meet and anticipate customers needs. Record level of Group supplier satisfaction 77.8% Full-year dividend 9.15p per share Voted Britains Favourite Supermarket* by customers for 5 years Colleagues