Tesco Share Discussion Threads

[the grumpy old men] 04/5/2016 09:17

Top Four UK Grocers Lose Market Share; Aldi, Lidl Shares Rise
04/05/2016 8:04am
Dow Jones News

Tesco (LSE:TSCO)
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Today : Wednesday 4 May 2016
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By Ian Walker



LONDON--German discount retailers Aldi and Lidl continued to take market share and sales from the top four U.K. grocers, which all saw their shares fall in the 12 weeks ended April 24, according to a market survey Wednesday.

Aldi and Lidl's joint market share rose to 10.4%, up from 9.2% in the comparable 12 weeks ended April 26, 2015, Kantar said. Kantar monitors the household grocery purchasing habits of 25,000 demographically representative households in the U.K.

Separately, Aldi's market share has risen to 6% in the 12 weeks ended April 24, from 5.4% for the comparable period in 2015. Lidl's market share has risen to 4.4%, from 3.8% in the 12 weeks ended April 26, 2015.

Aldi's sales in the 12 weeks have grown 13% to 1.53 billion pounds ($2.22 billion), while Lidl's shares have risen 15% to GBP1.12 billion.

Tesco PLC's (TSCO.LN) market share has fallen to 28%, from 28.4% in the 12 weeks ended April 26, 2015 and sales have fallen 1.3% to GBP7.12 billion.

Sainsbury PLC's (SBRY.LN) market share in the 12 weeks ended April 24 was unchanged at 16.5%, while sales fell 0.4% to GB4.18 billion.

Asda, a subsidiary of Wal-Mart Stores Inc. (WMT), saw its market share fall to 16%, from 16.9% for the comparable 12 weeks, with sales 5.1% lower at GBP4.1 billion.

Up-market retailer Waitrose' market share rose to 5.2%, from 5.1% in the 12 months ended April 26, 2015, while sales climbed 1.5% at GBP1.32 billion.

Wm Morrison Supermarkets PLC (MRW.LN)'s market share fell to 10.6%, from 10.9%, while sales are 2.6% lower at GBP2.69 billion.



Write to Ian Walker at [e-mail]



(END) Dow Jones Newswires

May 04, 2016 03:49 ET (07:49 GMT)

[buoycat] 04/5/2016 09:09

It's called a market

[vaneric] 04/5/2016 09:03

Manipulated down to make traders a lot of money, now to manipulate it back up to two quid and make a lot more.

[buoycat] 04/5/2016 08:43

I agree about the tech. It's what did for Woolworths. Our Woolworths was replaced by Wilkinson's; Woolworths without the tech in all but name.

[the_man_with_the_pink_gun] 03/5/2016 18:54

STRONG SELL

TARGET £1.28P

[rlivsey] 03/5/2016 17:44

It's all v depressing. Are we heading toward 1.50 again ?

[cherryandwhite2] 03/5/2016 17:21

crikey, all gone quiet here.

[fangorn2] 27/4/2016 16:58

@Cape,

Judging by Amazon's tax bill - not very much at all!!

[capeview] 27/4/2016 16:55

Yes, but how much profit is Amazon really making?

[dealer1972] 27/4/2016 16:35

I'd beg to differ! Amazon are entering the grocery arena!

[capeview] 27/4/2016 15:50

Maybe Tesco needs to go back to just selling the essentials and come out of some of the other sectors such as gaming, media and tech because a lot of what they sell can be bought cheaper and better quality elsewhere.
After all,you don't see big tech companies or gaming retailers all trying to sell groceries, and add to that some excellent customer service and the could make a huge recovery.
When I shop in Waitrose I go for groceries, if I want tech I go to John Lewis, but I get excellent customer service in both and they feel like 2 very different stores. With Tesco, it feels like one great big store trying to do everything with no real definition as to what Tesco is about, and when the likes of Tesco, sainsburys and Asda all try the customer service thing, it always feels tacked on as an after thought.
If they went back to competing in the groceries division, I would think they could have a huge turnaround and maybe spin of there other businesses as a separate entity.

[gotnorolex] 27/4/2016 15:11

Tesco (From the Fool a day earlier)
Tesco once had around 33% of the UK market, but its slice is now down to 28%, as low-price rivals Aldi and Lidl have made relentless progress. It remains the super-heavyweight with nearest competitor Sainsbury’s having just 16.4% of the market. But will the UK’s number one see its market share further eroded, or can it fight back and thrive once again?

In France, Carrefour was hit by competition earlier than Tesco, and its response looks the model for the UK firm. It brought prices down, not to Aldi/Lidl levels, but enough to entice customers back with a balance of value, range and service. It’s proved a successful strategy and the shares have made a big recovery over the past few years.

Tesco has been sowing similar seeds and there are signs of green shoots. The Welwyn Garden City firm’s annual results earlier this month showed improving trends across the board in the final quarter of last year. Analysts expect earnings to more than double this year, followed by a 35% increase next year, bringing a high price-to-earnings (P/E) ratio down to a reasonable 18. It’s early days, but the shares could continue to march higher if a Carrefour-like recovery unfolds.

[philanderer] 27/4/2016 13:40

FT Alphaville this morning


Tesco PLC (TSCO:LSE): Last: 176.05, down 7.4 (-4.03%), High: 181.20, Low: 176.00, Volume: 14.43m
PM
So it has
PM
Why?
BE
I believe it’s on Cazenove saying the balance sheet’s still too thin.
BE
And stepping back figures after “taking a closer look” at the FY results.
BE
Which I think is code for finding a buried profit warning.
PM
ha
BE
We derive our new EPS estimates, c20% lower in
2016/17E and c10% lower thereafter, based on these trends and the new guidance
provided by management.

Our main conclusions are the following:

(i) Tesco’s ability to generate cash flow in the foreseeable future could be
more constrained than we thought before the results;

(ii) The results were of lower quality than it seemed at first glance;

(iii) The upcoming news flow is likely going to remain negative across the
industry and for Tesco in particular, we believe, as we expect the
discounters to react to Tesco’s Farm brands and Asda to sequentially
improve its performance;

(iv) We acknowledge that the improving UK LFL volume trend poses a risk
to our UW thesis but rather believe it is more likely set to fade in the
coming months as competition intensifies.

BE
And in terms of the balance sheet ………..

BE
At c£740m, FCF generation in ‘15/16 was decent for this stage of the turnaround, we believe. We note, however, that FCF benefited from the following tailwinds that are unlikely to recur to the same extent in 2016/17E:
- Capex of c£1bn (well below depreciation of £1.3bn, down 45% from £2bn
in 2014/15 and £3bn in 2012/13);

- Working capital improvement of £350mn (inc £280mn inflow generated by
the discontinuation of Korea up to the point of disposal);
- No tax payment in the year (tax loss carry-forward following last year’s
losses in the UK);

BE
Actually, let me spin back up to page one.
BE
 FCF: Following a more prudent profitability outlook, higher capex guided,
smaller WC tailwinds & normalized taxes, we do not expect FCF to
improve in 2016/17E, projecting £716m FCF (4.5% FCF yield or 6% at our
150p PT).

 Profitability: We are of the view that some of the tailwinds benefiting
EBIT in 2015/16E are unlikely to recur to the same extent going forward
(e.g. GM expansion, stock losses reduction, shrinking fuel within the mix,
declining operating leases, extended asset lives etc; see Tables 3-7).
Surprisingly, operating costs (EBITDAR less implied gross profit) were up
c£200mn YoY to £11.4bn from £11.2bn despite £400mn of cost savings
delivered. We believe that Tesco’s high fixed cost base and increasing
variable costs, in combination with a reduced pace of cost savings
opportunity going forward could result in a muted margin expansion in the
UK of 30bp YoY to 1.5% in 2016/17E (sequence: 1.6% in 2H15/16 after
0.8% in 1H15/16 from losses in 2H14/15).

 B/S: We view Tesco’s progress in reducing indebtedness as impressive, but
the B/S remains stretched, at 4.6x LA (lease adjusted) ND/EBITDAR. This
remains a concern in the context of Tesco’s thin margins and the more
marked structural and cyclical headwinds within its core UK market.

BE
All of which is quite aggressive, really, particularly if we’re assuming Asda’s going to pull the trigger on a price war.

[philanderer] 27/4/2016 13:35

27th april

JP Morgan Cazenove 'underweight' target price 150p

[james smith] 27/4/2016 11:40

TESCO - TSCO
James Smith - 22 Apr 2015 - 23:01:35 - 14617 of 17452
Back to 175p where it should have stayed.

[james smith] 27/4/2016 11:37

Just finding it's natural level. It will be there soon.

[robrah] 27/4/2016 11:34

Just because they can :)

[tfergi] 27/4/2016 11:15

Why the drop today??

[james smith] 26/4/2016 20:36

We're Still Going ! to 175p. again !

[capeview] 25/4/2016 11:23

Just had a letter through the post from Tesco. Tesco boost is coming to an end this May with the last one to double your reward vouchers from £5 to £10 on all sorts of items.
Was obvious this was going to happen. They are looking to give customers extra value with there reward points and partner boosts.

Won't be long before that changes too.

As Tesco says, 'Every little helps'

Will be interesting to see if this boosts there profits into this full year or hinders it with lack of sales?

[chinese investor] 22/4/2016 09:31

We're Still Going !

[chinese investor] 22/4/2016 08:34

Here We Go !

[andrewbaker] 21/4/2016 14:15

At current price levels, TSCO is definitely worth buying on any dips, and at any price under 200p., IMHO.

Disclosure: long TSCO.

[chinese investor] 21/4/2016 13:24

Back On Track !