Tesco'S Profit Plunged In The First Half Of 90%

Under the adverse effects of false accounts and fierce market competition, Tesco group, the second largest retailer in the world, slumped 92% to 112 million in the first half of 2014.

On that day, its share price fell 6%, and its market value shrank by 1 billion, only half of what it was in January.

This is the second bad news of Tesco in a month.

In September 22nd, Tesco issued a statement that in its semi annual report released in August, the company falsified the profit of 250 million pounds (US $410 million) by accounting. The group hired DDT to conduct an investigation.

Affected by this, British district head, food director, food procurement supervisor and other executives were suspended from the investigation. Philip Clarke and chief financial officer Laurie McVey (Laurie McIlwee) were suspended from the company's salary. The time of publication of the group's mid year financial report was also postponed from October 1st to October 23rd.

According to the latest survey, there is about $410 million black hole in the Tesco account book. Previously, the fake accounts will be booked but the discount products that have not yet been sold will be used as income items, and at the same time, the sales cost will be reduced.

Tesco claims that financial fraud has been going on for at least two years, and the company will face heavy penalties from the UK financial market conduct authority.

In October 16th, Buffett, a "stock god", admitted in an interview with CNBC television that he had held a Tesco stock for 7 years and made a "huge mistake" himself.

A statement submitted by Buffett's Boxill Hathaway company to the London Stock Exchange shows that the company has reduced its stake in Tesco to less than 3% (see interface earlier: Buffett admits to seeing who can save TESCO).

Founded in 1919, Tesco is currently the largest private employer in Europe with a total workforce of over 500 thousand.

What has brought this glorious history enterprise to the end? In recent years, with the increasing popularity of Aldi and Lidl, a large chain discount supermarket in the UK, customers are increasingly dissatisfied with the quality and price of Tesco products and gradually lose their trust.

Not only has the local market failed, but also its overseas markets, such as the US and China, have suffered a setback.

Sales of Tesco declined sharply due to fierce competition from low-cost operators.

9 in mid - and late June, Tesco admitted that its profits were falsely reported in the first half of the year under external pressure.

Although Tesco claims not to be confident of making profits in the current fiscal year, the world's second largest retailer has to go back to its feet.

On the 23 day, Tesco chairman Richard Broadbent Richard Broadbrent said in a statement: "once the management level is over, the implementation of the new business plan will mark the beginning of a new stage for the company." (Lord)

Shore Capital, a retail analyst at stock broker, Clive Black (Clive Black) welcomed the company's high-level handover.

He told the daily telegraph that "once pnational giants are now in a mess, Lewis is the kind of leader they need urgently."

Black Lewis, a new CEO Dave Lewis (Dave Lewis), came from Unilever to replace Clark, who resigned under the pressure of scandal, for 7 weeks. But when he attended the performance conference yesterday, he obviously had easily integrated into the company's corporate culture.

This may be the positive signal that investors and Black saw.

Lewis acknowledges that there are more reasons for the situation, for example, the prices of some commodities have risen continuously in the past 18 months.

The number is decreasing.

Lewis said he wanted to change these phenomena. For example, he was going to sell four of the company's aircraft, and his staff would travel to London's surrounding cities instead of travelling by train instead of luxurious commercial vehicles.

He wants to spend money on places that customers can feel, such as getting more attendants in the shop.

"I am very interested in brand DNA," he said. "Now is the time to get Tesco back to its original state.

Tesco is the best practitioner of the doctrine of "customer first".

Obviously, for Tesco.

Lewis did his homework.

He can freely tell this allusion to a senior executive with a history of nearly a hundred years. For example, before 1977, executive Lord MacLaurin ordered all stores to shut down for a day in order to promote sales, and how the membership card introduced by former CEO Terry Leahy (1997 -2011) worked.

As for concrete revitalization

Plan, Lewis sold a pass, "detailed plan, I will be open after the implementation."

For such confidence, the outside world should be sure, but don't forget that his predecessor, Clark, also had a similar oath like speech in February.

After all, the criteria for judging a senior executive are the financial statements of an enterprise, the degree of satisfaction of customers and employees, rather than the beauty of a PPT speech.