COVID-19 UPDATE AND PRELIM RESULTS 2019/20 - PT 2

RNS Number : 1443J

Tesco PLC

08 April 2020

 

Wednesday 8 April 2020

COVID-19 UPDATE AND   PRELIMINARY RESULTS 2019/20

This is Part 2 of 2 of the Preliminary Results 2019/20

Tesco PLC - Parent Company balance sheet

Notes		29 February 2020 £m	23 February 2019 £m
Non-current assets
Investments	6	17,829	17,887
Receivables	7	1,043	2,139
Derivative financial instruments	12	1,167	1,043
		20,039	21,069
Current assets
Receivables	7	547	1,154
Short-term investments	8	-	11
Cash and cash equivalents	9	249	6
		796	1,171
Current liabilities
Borrowings	11	(43)	(766)
Payables	10	(238)	(242)
Derivative financial instruments	12	-	(213)
		(281)	(1,221)
Net current assets/(liabilities)		515	(50)
Non-current liabilities
Borrowings	11	(2,285)	(2,536)
Payables	10	(82)	(88)
Derivative financial instruments	12	(735)	(303)
		(3,102)	(2,927)
Net assets		17,452	18,092
Equity
Share capital	15	490	490
Share premium		5,165	5,165
All other reserves		2,950	2,969
Retained earnings (including profit/(loss) for the financial year of £(21)m (2019: £3,074m))		8,847	9,468
Total equity		17,452	18,092

The notes on pages 102 to 106 form part of these financial statements.

Dave Lewis

Alan Stewart

Directors

The Parent Company financial statements on pages 100 to 106 were approved and authorised for issue by the Directors on

7 April 2020.

Tesco PLC

Registered number 00445790

Tesco PLC - Parent Company statement of changes in equity

				All other reserves
	Share capital £m	Share premium £m	Currency basis reserve £m	Capital redemption reserve £m	Hedging reserve £m	Own shares held £m	Merger reserve £m	Retained earnings £m	Total equity £m
At 23 February 2019	490	5,165	(13)	16	95	(179)	3,050	9,468	18,092
Profit/(loss) for the year	-	-	-	-	-	-	-	(21)	(21)
Other comprehensive income/(loss)
Gains/(losses) on cash flow hedges	-	-	(7)	-	92	-	-	-	85
Reclassified and reported in the Company income statement	-	-	-	-	(23)	-	-	-	(23)
Tax relating to components of other comprehensive income	-	-	1	-	(11)	-	-	-	(10)
Total other comprehensive income/(loss)	-	-	(6)	-	58	-	-	-	52
Total comprehensive income/(loss)	-	-	(6)	-	58	-	-	(21)	31
Transactions with owners
Purchase of own shares	-	-	-	-	-	(221)	-	-	(221)
Share-based payments	-	-	-	-	-	150	-	56	206
Issue of shares	-	-	-	-	-	-	-	-	-
Dividends	-	-	-	-	-	-	-	(656)	(656)
Total transactions with owners	-	-	-	-	-	(71)	-	(600)	(671)
At 29 February 2020	490	5,165	(19)	16	153	(250)	3,050	8,847	17,452
			All other reserves
	Share capital £m	Share premium £m	Currency basis reserve £m	Capital redemption reserve £m	Hedging reserve £m	Own shares held £m	Merger reserve £m	Retained earnings £m	Total equity £m
At 24 February 2018	410	5,107	-	16	62	(16)	-	6,693	12,272
Adjustment on initial application of IFRS 9 (net of tax)	-	-	(13)	-	13	-	-	(5)	(5)
At 25 February 2018	410	5,107	(13)	16	75	(16)	-	6,688	12,267
Profit/(loss) for the year	-	-	-	-	-	-	-	3,074	3,074
Other comprehensive income/(loss)
Gains/(losses) on cash flow hedges	-	-	-	-	38	-	-	-	38
Reclassified and reported in the Company income statement	-	-	-	-	(13)	-	-	-	(13)
Tax relating to components of other comprehensive income	-	-	-	-	(5)	-	-	-	(5)
Total other comprehensive income/(loss)	-	-	-	-	20	-	-	-	20
Total comprehensive income/ (loss)	-	-	-	-	20	-	-	3,074	3,094
Transactions with owners
Purchase of own shares	-	-	-	-	-	(277)	-	-	(277)
Share-based payments	-	-	-	-	-	114	-	63	177
Issue of shares	80	58	-	-	-	-	3,050	-	3,188
Dividends	-	-	-	-	-	-	-	(357)	(357)
Total transactions with owners	80	58	-	-	-	(163)	3,050	(294)	2,731
At 23 February 2019	490	5,165	(13)	16	95	(179)	3,050	9,468	18,092

The Company has considered the profits available for distribution to shareholders. At 29 February 2020, the Company had retained earnings of £8.8bn, of which the unrealised profit elements are £1.7bn of share-based payment reserves and £1.4bn of dividends received from subsidiary undertakings not yet settled by qualifying consideration. After deducting the cost of its own shares held in trust of £0.3bn, the Company had profits available for distribution of £5.4bn, sufficient to support the planned 50% ordinary dividend pay-out ratio in line with the Group's dividend policy.

The Group also has retained profits in its subsidiary companies which are expected to flow up to the Company in due course to further supplement its distributable reserves position. The Company would expect to receive such dividends from the proceeds of the proposed sale of Tesco Thailand and Tesco Malaysia, which is subject to shareholder approval. The Company has announced its intention to declare a special dividend of c.£5bn, also subject to shareholder approval, following completion of the sale and publication of interim company accounts.

The notes on pages 102 to 106 form part of these financial statements.

Notes to the Parent Company financial statements

Note 1 Authorisation of financial statements and statement of compliance with FRS 101

The Parent Company financial statements for the 53 weeks ended 29 February 2020 were approved by the Board of Directors on 7 April 2020 and the Company balance sheet was signed on the Board's behalf by Dave Lewis and Alan Stewart.

These financial statements were prepared in accordance with Financial Reporting Standard 101, 'Reduced Disclosure Framework' (FRS 101). The Company meets the definition of a qualifying entity under FRS 100, 'Application of Financial Reporting Requirements' as issued by the Financial Reporting Council.

The Company's financial statements are presented in Pounds Sterling, its functional currency, generally rounded to the nearest million.

The principal accounting policies adopted by the Company are set out in Note 2. The financial statements have been prepared under the historical cost convention, except for certain financial instruments and share-based payments that have been measured at fair value.

Note 2 Accounting policies

Basis of preparation of financial statements

The Parent Company financial statements have been prepared in accordance with FRS 101 and the Companies Act 2006 (the Act).

FRS 101 sets out a reduced disclosure framework for a 'qualifying entity' as defined in the standard which addresses the financial reporting requirements and disclosure exemptions in the individual financial statements of qualifying entities that otherwise apply the recognition, measurement and disclosure requirements of EU-adopted IFRS.

The financial year represents the 53 weeks to 29 February 2020 (prior financial year 52 weeks to 23 February 2019).

As permitted by FRS 101, the Company has taken advantage of the disclosure exemptions available under that standard in relation to business combinations, financial instruments, capital management, presentation of comparative information in respect of certain assets, presentation of a cash flow statement, impairment of assets, share-based payments and related party transactions. Where required, equivalent disclosures are given in the consolidated financial statements of Tesco PLC.

The Parent Company financial statements are prepared on a going concern basis as set out in Note 1 of the consolidated financial statements of Tesco PLC.

The Directors have taken advantage of the exemption available under Section 408 of the Companies Act 2006 and not presented an income statement or a statement of comprehensive income for the Company alone.

A summary of the Company's significant accounting policies is set out below.

Short-term investments

Short-term investments are recognised initially at fair value, and subsequently at amortised cost. All income from these investments is included in the Company income statement as interest receivable and similar income.

Investments in subsidiaries and joint ventures

Investments in subsidiaries and joint ventures are stated at cost less, where appropriate, provisions for impairment. The Company tests the investment balances for impairment annually or when there are indicators of impairment.

Foreign currencies

Transactions in foreign currencies are translated to the functional currency at the exchange rate on the date of the transaction. At each balance sheet date, monetary assets and liabilities that are denominated in foreign currencies are retranslated to the functional currency at the rates prevailing on the balance sheet date.

Share-based payments

The fair value of employee share option plans is calculated at the grant date using the Black-Scholes or Monte Carlo model. The resulting cost is charged to the Company income statement over the vesting period. The value of the charge is adjusted to reflect expected and actual levels of vesting. Where the Company awards shares or options to employees of subsidiary entities, this is treated as a capital contribution.

Own shares held

Own shares represent the shares of Tesco PLC that are held in Treasury or by the Employee Benefit Trust. The Company adopts a 'look-through' approach which, in substance, accounts for the trust as an extension of the Company. Own shares are recorded at cost and are deducted from equity.

Financial instruments

Financial assets and financial liabilities are recognised in the Company balance sheet when the Company becomes party to the contractual provisions of the instrument.

Receivables

Receivables are recognised initially at fair value, and subsequently at amortised cost using the effective interest rate method, less any expected credit losses.

Financial liabilities and equity instruments

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that gives a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments issued by the Company are recorded as the proceeds received, net of direct issue costs.

Interest-bearing borrowings

Interest-bearing bank loans and overdrafts are initially recognised at fair value, net of attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost with any differences between proceeds and redemption value being recognised in the Company income statement over the period of the borrowings on an effective interest basis.

Payables

Payables are recognised initially at fair value, and subsequently at amortised cost using the effective interest rate method.

Derivative financial instruments and hedge accounting

The Company uses derivative financial instruments to hedge its exposure to foreign exchange and interest rate risks arising from operating, financing and investing activities. The Company does not hold or issue derivative financial instruments for trading purposes; however if derivatives do not qualify for hedge accounting they are accounted for as such.

Derivative financial instruments are recognised and stated at fair value. Where derivatives do not qualify for hedge accounting, any gains or losses on remeasurement are immediately recognised in the Company income statement. Where derivatives qualify for hedge accounting, recognition of any resultant gain or loss depends on the nature of the hedge relationship and the item being hedged. In order to qualify for hedge accounting, the Company is required to document from inception, the relationship between the item being hedged and the hedging instrument.

The Company is also required to document and demonstrate an assessment of the relationship between the hedged item and the hedging instrument, which shows that the hedge will be highly effective on an ongoing basis. This effectiveness testing is performed at each reporting date to ensure that the hedge remains highly effective.

Derivative financial instruments with maturity dates of more than one year from the reporting date are disclosed as non-current.

Fair value hedging

Derivative financial instruments are classified as fair value hedges when they hedge the Company's exposure to changes in the fair value of a recognised asset or liability. Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the Company income statement, together with any changes in the fair value of the hedged item that is attributable to the hedged risk.

Cash flow hedging

Derivative financial instruments are classified as cash flow hedges when they hedge the Company's exposure to variability in cash flows that are either attributable to a particular risk associated with a recognised asset or liability, or a highly probable forecasted transaction. The effective element of any gain or loss from remeasuring the derivative designated as the hedging instrument is recognised directly in the Company statement of comprehensive income and accumulated in the hedging reserve. Any cost of hedging, such as the change in fair value related to forward points and currency basis adjustment is separately accumulated in the currency basis reserve. The ineffective element is recognised immediately in the Company income statement.

The associated cumulative gain or loss is reclassified from other comprehensive income and recognised in the Company income statement in the same period or periods during which the hedged transaction affects the Company income statement. The classification of the effective portion when recognised in the Company income statement is the same as the classification of the hedged transaction. Any element of the remeasurement criteria of the derivative instrument which does not meet the criteria for an effective hedge is recognised immediately in the Company income statement within finance income or costs.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies for hedge accounting. At that point in time, any cumulative gain or loss on the hedging instrument recognised in equity is retained in the Company statement of changes in equity until the forecasted transaction occurs or the original hedged item affects the Company income statement. If a forecast hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised in the Company statement of changes in equity is reclassified to the Company income statement.

Pensions

The Company participates in defined benefit pension schemes. There are no formal policies or contractual agreements for recharging within the Group and the Company cannot identify its share of the underlying assets and liabilities of the schemes. Accordingly, as permitted by IAS 19 'Employee Benefits', the Company has accounted for the schemes as defined contribution schemes, and the charge for the financial year is based upon the cash contributions payable.

The Company also participates in a defined contribution scheme open to all UK employees. Payments to this scheme are recognised as an expense as they fall due.

Taxation

The tax expense included in the Company income statement consists of current and deferred tax.

Current tax is the expected tax payable on the taxable income for the financial year, using tax rates enacted or substantively enacted by the balance sheet date. Tax expense is recognised in the Company income statement except to the extent that it relates to items recognised in the Company statement of comprehensive income or directly in the Company statement of changes in equity, in which case it is recognised in the Company statement of comprehensive income or directly in the Company statement of changes in equity, respectively.

Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised based on the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax is charged or credited in the Company income statement, except when it relates to items charged or credited directly to equity or other comprehensive income/(loss), in which case the deferred tax is also recognised in equity, or other comprehensive income/(loss), respectively.

Judgements and sources of estimation uncertainty

The preparation of the Company financial statements requires management to make judgements, estimates and assumptions in applying the Company's accounting policies to determine the reported amounts of assets, liabilities, income and expenses.

The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis, with revisions to accounting estimates applied prospectively.

The preparation of the Company financial statements for the financial year did not require the exercise of any critical accounting judgements or significant estimates.

New standards effective for the current financial year

-  IFRS 16 'Leases' which had no material impact on the Company; and

-  'Interest rate benchmark reform' amendments, which have been adopted early. Refer to Note 25 to the Group financial statements for the impact of IBOR Reform amendments on the Company.

Other standards and amendments

Refer to Note 1 to the Group financial statements.

Note 3 Auditor remuneration

Fees payable to the Company's auditor for the audit of the Company and Group financial statements are disclosed in Note 3 to the Group financial statements.

Note 4 Dividends

For details of dividends see Note 8 to the Group financial statements.

Note 5 Employment costs, including Directors' remuneration

Notes		2020 £m	2019 £m
Wages and salaries		16	17
Social security costs		2	3
Pension costs	14	2	4
Share-based payment expense	13	7	7
Total		27	31

The amounts above include recharges from other Group companies for Tesco PLC related activities.

The average number of employees (all Directors of the Company) during the financial year was 13 (2019: 13).

The table below sets out remuneration received by Directors:

	2020 £'000	2019 £'000
Salaries and fees	3,758	3,815
Incentive schemes (excluding share options)	7,413	5,019
Other benefits *	681	727
Total Directors ' remuneration	11,852	9,561

* Dave Lewis and Alan Stewart received a cash allowance in lieu of pension of 25% of base salary. Non-executive Directors are not paid a pension and do not participate in any of the Company's variable incentive schemes. The value of options exercised during the current financial year was £nil (2019: £17k).

Note 6 Investments

	2020 £m
Cost
At 23 February 2019	21,283
Additions	87
Disposals	(684)
At 29 February 2020	20,686
Accumulated impairment losses
At 23 February 2019	(3,396)
Impairment losses	(144)
Disposals	683
At 29 February 2020	(2,857)
Net carrying value
At 29 February 2020	17,829
At 23 February 2019	17,887

The impairment losses of £144m relate to the Group's disposal of Gain Land Limited and the subsequent impairment of its intermediate holding company Cheshunt Holdings Guernsey Limited to a recoverable amount of £241m, based on net asset value, a fair value less costs of disposal measurement at Level 3 in the fair value hierarchy. Refer to Note 33 in the Group financial statements for further details.

The list of the Company's subsidiary undertakings and joint ventures is shown on pages 107 to 113.

Note 7 Receivables

	2020 £m	2019 £m
Amounts owed by Group undertakings *	1,530	3,232
Amounts owed by joint ventures and associates	24	21
Other receivables	36	40
	1,590	3,293
Of which:
Current	547	1,154
Non-current	1,043	2,139
	1,590	3,293

*  Amounts owed by Group undertakings are either interest-bearing or non interest-bearing depending on the type and duration of the receivable relationship, with interest rates ranging from 0% to 3%, with maturities up to and including March 2025.

The expected credit loss on receivables is immaterial (2019: immaterial).

Note 8 Short-term investments

	2020 £m	2019 £m
Money market funds	-	11

Note 9 Cash and cash equivalents

	2020 £m	2019 £m
Cash and cash equivalents	249	6

Note 10 Payables

	2020 £m	2019 £m
Amounts owed to Group undertakings *	278	299
Other payables	11	11
Taxation and social security	4	3
Deferred tax liability	27	17
Total payables	320	330
Of which:
Current	238	242
Non-current	82	88
	320	330

*  Amounts owed to Group undertakings are either interest-bearing or non interest-bearing depending on the type and duration of the creditor relationship, with interest rates ranging from 0% to 3%, with maturities up to and including February 2051.

The deferred tax asset/(liability) recognised by the Company, and the movements thereon, during the current financial year are as follows:

	Financial instruments £m	Other timing differences £m	Total £m
At 23 February 2019	(17)	-	(17)
Movement in other comprehensive income/(loss) for the year	(10)	-	(10)
At 29 February 2020	(27)	-	(27)

Note 11 Borrowings

Current

	Parvalue	Maturity	2020 £m	2019 £m
Bank loans and overdrafts	-	-	43	668
5.5% MTN	£97m	Dec 2019	-	98
			43	766

Non-current

	Parvalue	Maturity	2020 £m	2019 £m
6.125% MTN (a)	£417m	Feb 2022	416	561
5% MTN (a)	£93m	Mar 2023	103	183
3.322% LPI MTN (b)	£354m	Nov 2025	358	349
6% MTN (a)	£48m	Dec 2029	58	119
5.5% MTN (a)	£109m	Jan 2033	133	186
1.982% RPI MTN (c)	£294m	Mar 2036	297	288
6.15% USD Bond	$525m	Nov 2037	555	428
4.875% MTN (a)	£20m	Mar 2042	20	32
5.125% MTN	€356m	Apr 2047	316	319
5.2% MTN (a)	£30m	Mar 2057	29	71
			2,285	2,536

^(a)  During the current financial year, the Group undertook a tender for outstanding bonds and as a result the following notional amounts were repaid early: 6.125% MTN Feb 2022 £114m, 5% MTN Mar 2023 £78m, 6% MTN Dec 2029 £50m, 5.5% MTN Jan 2033 £41m, 4.875% MTN Mar 2042 £12m and 5.2% MTN Mar 2057 £43m.

^(b)  The   3.322%   Limited Price Inflation (LPI) MTN is redeemable at par, indexed for increases in the RPI over the life of the MTN. The maximum indexation of the principal in any one year is 5%, with a minimum of 0%.

^(c)  The 1.982% RPI MTN is redeemable at par, indexed for increases in the RPI over the life of the MTN.

Note 12 Derivative financial instruments

The fair values of derivative financial instruments have been presented in the Company balance sheet as:

	2020		2019
	Asset £m	Liability £m	Asset £m	Liability £m
Current	-	-	-	(213)
Non-current	1,167	(735)	1,043	(303)
Total derivative financial instruments	1,167	(735)	1,043	(516)

	2020					2019
	Asset			Liability		Asset				Liability
	Fair value £m	Notional £m	Fair value £m		Notional £m		Fair value £m	Notional £m	Fair value £m		Notional £m
Fair value hedges
Interest rate swaps and similar instruments	10	65	-		-		11	65	-		-
Cross-currency swaps	228	409	-		-		126	180	(10)		222
Cash flow hedges
Cross-currency swaps	208	306	-		-		138	309	-		-
Index-linked swaps	185	649	-		-		170	632	-		-
Derivatives not in a formal hedge relationship
Index-linked swaps	536	3,339	(735)		4,461		598	3,339	(506)		3,339
Total	1,167	4,768	(735)		4,461		1,043	4,525	(516)		3,561

Note 13 Share-based payments

The Company's equity-settled share-based payment schemes comprise various share schemes designed to reward Executive Directors.

For further information on these schemes, including the valuation models and assumptions used, refer to Note 28 to the Group financial statements.

Share option schemes

The number of options and weighted average exercise price (WAEP) of share option schemes relating to the Company employees are:

For the 53 weeks ended 29 February 2020

For the 52 weeks ended 23 February 2019

	Savings-related Share Option Scheme		Nil cost Share options
	Options	WAEP	Options	WAEP
Outstanding at 24 February 2018	23,840	151.00	14,271,355	-
Granted	19,148	188.00	200,518	-
Forfeited	-	-	(1,704,300)	-
Exercised	(23,840)	151.00	(23,840)	-
Outstanding at 23 February 2019	19,148	188.00	12,743,733	-
Exercise price range (pence)		188.00	-	-
Weighted average remaining contractual life (years)		3.03	-	7.18
Exercisable at 23 February 2019	-	-	3,837,740	-
Exercise price range (pence)		-	-	-
Weighted average remaining contractual life (years)		-	-	6.00

Share bonus and incentive schemes

Executive Directors participate in the Group Bonus Plan, a performance-related bonus scheme. The amount paid is based on a percentage of salary and is paid partly in cash and partly in shares. Bonuses are awarded to Executive Directors who have completed a required service period and depend on the achievement of the corporate and individual performance targets. For further information on these schemes, including the valuation models and assumptions used, refer to Note 28 to the Group financial statements.

The number of share bonuses & share incentives awarded during the financial year were 506,768 (2019: 739,293) for Group Bonus Plan and 2,388,395 (2019: 2,071,068) for Performance Share Plan. Respectively weighted average fair value (WAFV) was 244.1p (2019: 241.8p) and 230.3p (2019: 254.8p).

Note 14 Pensions

The total cost of participation in the Tesco Retirement Savings Plan (a defined contribution scheme) to the Company was £1.9m (2019: £4.4m). Further disclosure relating to all schemes can be found in Note 29 to the Group financial statements.

Note 15 Called up share capital

Refer to Note 30 to the Group financial statements.

Note 16 Contingent liabilities

In addition to the contingent liabilities shown in Note 34 to the Group financial statements, the Company has entered into financial guarantee contracts to guarantee the indebtedness of Group undertakings amounting to £2,589m (2019: £1,715m). It has also guaranteed derivative agreements of Group undertakings with a gross liability of £168m (2019: £162m) at the reporting date. These guarantees are treated as contingent liabilities until it becomes probable they will be called upon.

In addition, the Company has guaranteed the rental payments of certain Group undertakings relating to a portfolio of retail stores, distribution centres and mixed use retail developments.

The likelihood of the above items being called upon is considered remote.

Note 17 Events after the reporting period

On 9 March 2020, the Group announced the proposed sale of Tesco Thailand and Tesco Malaysia for net cash proceeds of $10.3 billion (equivalent to £8.0 billion) before tax and other transaction costs. Subject to completion of the transaction, which is subject to shareholder and regulatory approval, the Board intends to return c.£5.0 billion to shareholders via a special dividend with associated share consolidation. Refer to Note 36 to the Group financial statements for further details on the transaction.

Refer to Note 36 to the Group financial statements for further details of the Group's assessment of the impact of the coronavirus pandemic (COVID-19).

Related undertakings of the Tesco Group continued

Name of undertaking	Registered address	Class of share held	% held by Group	Name of undertaking	Registered address	Class of share held	% held by Group
Acklam Management Company Limited	1	Limited by Guarantee	-	dunnhumby Overseas Limited	4	£1.00 Ordinary	100
Adminstore Limited	1	£0.01 A Ordinary	100	dunnhumby Trustees Limited	4	£1.00 Ordinary	100
		£0.01 B Ordinary	100	Giant Bidco Limited	8	£1.00 Ordinary	100
		£0.01 C Ordinary	100	Giant Booker Limited	8	£0.25 Ordinary	100
Alfred Preedy & Sons Limited	2	£1.00 Deferred	100	Giant Midco Limited	8	£1.00 Ordinary	100
		£1.00 Ordinary	100	Highams Green Management Company Limited	1	Limited by Guarantee	-
Armitage Finance Unlimited	1	£0.90 Ordinary	100	IRTH (15) Limited	8	£1.00 Ordinary	100
Bath Upper Bristol Road Management Company Limited	1	Limited by Guarantee	-	IRTH (19) Limited	8	US$0.000000052383172 Ordinary	100
Berry Lane Management Company Limited	1	Limited by Guarantee	-	Launchgrain Limited†	1	£1.00 Ordinary	100
BF Limited	8	£1.00 Ordinary	100	Linnco Limited	8	£1.00 Ordinary	100
Bishop's Group Limited	8	£0.01 Ordinary	100	Londis(Holdings) Limited	8	£50.00 Ordinary	100
Booker Cash & Carry Limited	8	£1.00 Ordinary	100	Londis Pension Trustees Limited	8	£1.00 Ordinary	100
Booker Direct Limited	8	£0.01 Ordinary	100	Makro Holding Limited	8	£1.00 Ordinary	100
Booker Group Limited	8	£0.00000000055625 Ordinary	100	Makro Properties Limited	8	£1.00 Ordinary	100
Booker Limited	8	£1.00 Ordinary	100	Makro Self Service Wholesalers Limited	8	£1.00 Ordinary A	100
Booker Retail Partners (GB) Limited	8	£1.00 Ordinary	100			£1.00 Ordinary B	100
Booker Retail Limited	8	£0.10 Ordinary	100	Maldon Finance Limited (e)	1	£1.00 Ordinary	100
Booker Pension Trustees Limited	8	Limited by Guarantee	100			$1.00 A Preference	100
Booker Wholesale Holdings Limited	8	£0.01 Ordinary A1	100			$0.50 B Preference	100
Booker Unapproved Scheme Trustees Ltd	8	Limited by Guarantee	-	Motorcause Limited	1	£1.00 Ordinary	100
Bourne End Residential	1	Limited by Guarantee	-	Murdoch Norton Limited	8	£0.05 Ordinary	100
Broughton Retail Park Nominee 1 Limited	1	£1.00 Ordinary	100	Munster Road Management Company Limited	1	Limited by Guarantee	-
Broughton Retail Park Nominee 2 Limited	1	£1.00 Ordinary	100	Oakwood Distribution Limited	1	£1.00 Ordinary	100
Broughton Retail Park Nominee 3 Limited	1	£1.00 Ordinary	100	One Stop Community Stores Limited	2	£0.00001200004 Ordinary	100
Broughton Retail Park Nominee 4 Limited	1	£1.00 Ordinary	100	One Stop Convenience Stores Limited	2	£1.00 Ordinary	100
Budgen Holdings Limited	8	£1.00 Ordinary	100	One Stop Stores Limited†(a)	2	£1.00 Ordinary	100
Budgens Pension Trustees No.2 Limited	8	£1.00 Ordinary	100	One Stop Stores Trustee Services Limited	2	£1.00 Ordinary	100
Budgens Property Investments Limited	8	£1.00 Ordinary	100	Orpington (Station Road) Limited	1	£1.00 Ordinary	100
Budgens Stores Limited	8	£1.00 Ordinary	100	Oxford Fox and Hounds Management Company Limited	1	Limited by Guarantee	-
Buttoncable Limited	1	£1.00 Ordinary	100	Paper Chain (East Anglia) Limited	2	£1.00 Deferred	100
Buttoncase Limited†	1	£1.00 Cumulative Redeemable Preference	100			US$0.001 Ordinary	100
		£1.00 Ordinary	100	PTLL Limited	1	£1.00 Ordinary	100
Canterbury Road Management Limited	1	Limited by Guarantee	-	Ritter-Courivaud Limited	8	£0.10 Ordinary	100
Cardiff Cathays Terrace Management Company Limited	1	Limited by Guarantee	-	Seacroft Green Nominee 1 Limited	1	£1.00 Ordinary	100
Comar Limited†	1	£1.00 Ordinary	100	Seacroft Green Nominee 2 Limited	1	£1.00 Ordinary	100
Day And Nite Stores Limited	2	£1.00 Cumulative Convertible Participating Preferred Ordinary	100	Spen Hill Developments Limited	1	£1.00 Ordinary	100
		£1.00 Cumulative Redeemable Preference	100	Spen Hill Management Limited†(b)	1	£1.00 Ordinary	100
		£1.00 Ordinary	100	Spen Hill Properties (Holdings) plc†	1	£1.00 Ordinary	100
Dillons Newsagents Limited*	2	£0.25 Non-Voting Ordinary	100	Spen Hill Regeneration Limited	1	£1.00 Ordinary	100
dunnhumby Holding Limited	4	£1.00 Ordinary	100	Spen Hill Residential No 1 Limited	1	£1.00 Ordinary	100
dunnhumby International Limited	4	£1.00 Ordinary	100	Spen Hill Residential No 2 Limited	1	£1.00 Ordinary	100
dunnhumby Limited	4	£3.59 Ordinary	100	Station House Welling Management Limited	1	Limited by Guarantee	-
				Statusfloat Limited	1	£1.00 Ordinary	100

	Name of undertaking	Registered address			Class of share held			% held by Group		Name of undertaking			Registered address			Class of share held			% held by Group
	T & S Stores Limited†	2			£0.05 Ordinary			100								£1.00 B Ordinary			100
	Tapesilver Limited†	1			£1.00 Ordinary			100		Tesco Navona (Nominee 1) Limited			1			£1.00 Ordinary			100
	Teesport (GP) Limited	1			£1.00 Ordinary			100		Tesco Navona (Nominee 2) Limited			1			£1.00 Ordinary			100
	Tesco (Overseas) Limited†	1			£1.00 Ordinary			100		Tesco Navona (Nominee Holdco) Limited			1			£1.00 Ordinary			100
	Tesco Aqua (3LP) Limited	1			£1.00 Ordinary			100		Tesco Navona PL Propco Limited			1			£1.00 Ordinary			100
	Tesco Aqua (FinCo1) Limited	1			£1.00 Ordinary			100		Tesco Overseas Investments Limited†			1			£1.00 Ordinary			100
	Tesco Aqua (FinCo2) Limited	1			£1.00 Ordinary			100		Tesco Overseas ULC			1			£0.00000025 A Ordinary			100
	Tesco Aqua (GP) Limited	1			£1.00 A Ordinary			100								£0.00000025 B Ordinary			100
					£1.00 B Ordinary			100								£0.00000025 C Ordinary			100
	Tesco Aqua (Nominee 1) Limited	1			£1.00 Ordinary			100								£0.00000025 D Ordinary			100
	Tesco Aqua (Nominee 2) Limited	1			£1.00 Ordinary			100								£0.00000025 E Ordinary			100
	Tesco Aqua (Nominee Holdco) Limited	1			£1.00 Ordinary			100								£0.00000025 F Ordinary			100
	Tesco Atrato (1LP) Limited	1			£1.00 Ordinary			100								£0.00000025 G Ordinary			100
	Tesco Atrato (GP) Limited	1			£1.00 A Ordinary			100								£0.00000025 H Ordinary			100
					£1.00 B Ordinary			100								£0.00000025 J Ordinary			100
	Tesco Atrato (Nominee 1) Limited	1			£1.00 Ordinary			100								£0.00000025 K Ordinary			100
	Tesco Atrato (Nominee 2) Limited	1			£1.00 Ordinary			100								£0.00000025 L Ordinary			100
	Tesco Atrato (Nominee Holdco) Limited	1			£1.00 Ordinary			100								£0.00000025 M Ordinary			100
	Tesco Atrato Depot Propco Limited	1			£1.00 Ordinary			100								£0.00000025 N Ordinary			100
	Tesco Blue (GP) Limited	1			£1.00 A Ordinary			100								£0.00000025 O Ordinary			100
					£1.00 B Ordinary			100								£0.00000025 P Ordinary			100
	Tesco Blue (Nominee 1) Limited	1			£1.00 Ordinary			100		Tesco Passaic (1LP) Limited			1			£1.00 Ordinary			100
	Tesco Blue (Nominee 2) Limited				£1.00 Ordinary			100		Tesco Passaic (GP) Limited			1			£1.00 A Ordinary			100
	Tesco Blue (Nominee Holdco) Limited				£1.00 Ordinary			100								£1.00 B Ordinary			100
	Tesco Corporate Treasury Services PLC†	1			£1.00 Ordinary			100		Tesco Passaic (Nominee 1) Limited			1			£1.00 Ordinary			100
	Tesco Depot Propco Limited	1			£1.00 Ordinary			100		Tesco Passaic (Nominee 2) Limited			1			£1.00 Ordinary			100
	Tesco Distribution Holdings Limited	1			£1.00 Ordinary			100		Tesco Passaic (Nominee Holdco) Limited			1			£1.00 Ordinary			100
	Tesco Distribution Limited	1			£1.00 Ordinary			100		Tesco Passaic PL Propco Limited			1			£1.00 Ordinary			100
	Tesco Dorney (1LP) Limited	1			£1.00 Ordinary			100		Tesco PEG Limited			1			£0.01 Ordinary			100
	Tesco Employees' Share Scheme Trustees Limited†(c)	1			£1.00 Ordinary			100		Tesco PEG Limited			1			£1.00 Ordinary			100
	Tesco Family Dining Limited	1			£1.00 Ordinary			100		Tesco Pension Investment Limited(d)			1			£1.00 Ordinary			100
	Tesco Food Sourcing Limited	1			£1.00 Ordinary			100		Tesco Pension Trustees Limited†			1			£1.00 Ordinary			100
	Tesco Freetime Limited	1			£1.00 Ordinary			100		Tesco Personal Finance Group PLC†			6			£0.10 A Ordinary			100
	Tesco Fuchsia (3LP) Limited	1			£1.00 Ordinary			100								£0.10 B Ordinary			100
	Tesco Gateshead Property Limited	1			£1.00 Ordinary			100								£0.10 C Ordinary			100
	Tesco Holdings Limited†	1			£0.10 Ordinary			100		Tesco Personal Finance PLC			6			£0.10 Ordinary			100
					£1.00 Preference			100		Tesco Property (Nominees) (No.1) Limited			7			£1.00 Ordinary			100
	Tesco International Services Limited†	1			£1.00 Ordinary			100		Tesco Property (Nominees) (No.2) Limited			7			£1.00 Ordinary			100
	Tesco Lagoon GP Limited	5			£1.00 Ordinary			100		Tesco Property (Nominees) Limited			7			£1.00 Ordinary			100
	Tesco Maintenance Limited	1			£1.00 Ordinary			100		Tesco Property Finance 1 Holdco Limited			1			£1.00 Ordinary			100
	Tesco Mobile Communications Limited†	1			£1.00 Ordinary			100		Tesco Property Finance 1 PLC			1			£1.00 Ordinary			100
	Tesco Mobile Services Limited	1			£1.00 Ordinary			100								£0.25 Ordinary			100
	Tesco Navona (1LP) Limited	1			£1.00 Ordinary			100		Tesco Property Holdings (No.2) Limited			1			£1.00 Ordinary			100
	Tesco Navona (GP) Limited	1			£1.00 A Ordinary			100		Tesco Property Holdings Limited			1			£1.00 Ordinary			100
										Tesco Property Nominees (No.5) Limited			1			£1.00 Ordinary			100
										Tesco Property Nominees (No.6) Limited			1			£1.00 Ordinary			100
										Tesco Property Partner (GP) Limited†			1			£1.00 Ordinary			100
	Name of undertaking	Registered address		Class of share held			% held by Group	Name of undertaking				Registered address			Class of share held				% held by Group
	Tesco Property Partner (No.1) Limited†	1		£1.00 Ordinary			100	dunnhumby Chile SpA				48			CLP 500,000 Ordinary				100
	Tesco Property Partner (No.2) Limited†	1		£1.00 Ordinary			100	dunnhumby Colombia S.A.S.				74			COP 2,000 Type A				100
	Tesco Red (3LP) Limited	1		£1.00 Ordinary			100								COP 41.00 Type B
	Tesco Red (GP) Limited	1		£1.00 Ordinary A			100								COP 1.00 Type C
				£1.00 Ordinary B			100	dunnhumby Computer Information Technology and Consultancy Services LLC				18			TL 25.00 Ordinary				100
	Tesco Red (Nominee 1) Limited	1		£1.00 Ordinary			100	dunnhumby Consulting Services India Private Limited				60			INR 10.00 Ordinary				100
	Tesco Red (Nominee 2) Limited	1		£1.00 Ordinary			100	dunnhumby Czech s.r.o.				16			CZK 200,000 Ordinary				100
	Tesco Red (Nominee Holdco) Limited	1		£1.00 Ordinary			100	dunnhumby Denmark lvS				57			DKK 1.00 Ordinary				100
	Tesco Sarum (1LP) Limited	1		£1.00 Ordinary			100	dunnhumby Finland Oy				30			100 Kovellinum Oy				100
	Tesco Seacroft Limited	1		£1.00 Ordinary			100	dunnhumby France SAS				61			€2.00 Ordinary				100
	Tesco Secretaries Limited	1		£1.00 Ordinary			100	dunnhumby Germany GmbH				14			€1.00 Ordinary				100
	Tesco Services Limited	1		£1.00 Ordinary			100	dunnhumby Hungary Kft				32			Registered capital HUF 3,000,000				100
	Tesco Stores Limited	1		£1.00 A Preference			100	dunnhumby Inc.				35			No par value				-
				£1.00 B Preference			100	dunnhumby Information Technology Consulting (Shanghai) Company Limited				62			Registered capital US$140,000				100
				£1.00 Ordinary			100	dunnhumby Ireland Limited				67			€1.00 Ordinary				100
	Tesco TLB Finance Limited	1		£1.00 Ordinary			100	dunnhumby IT Services India Private Limited				36			INR 10.00 Ordinary				100
	Tesco TLB Properties Limited	1		£1.00 Ordinary A			100	dunnhumby Italia Srl.				37			€1.00 Ordinary				100
				£1.00 Ordinary B			100	dunnhumby Japan K.K				38			JPY 10,000 Ordinary				100
	The Big Food Group Limited	8		£0.10 Ordinary			100	dunnhumby Mexico S. de R.L. de C.V.				69			MXN 2,970 Ordinary A				100
	The Teesport Limited Partnership	1		Limited Partnership			100								MXN 30.00 Ordinary B
	The Tesco Aqua Limited Partnership	1		Limited Partnership			100	dunnhumby Netherlands B.V.				70			€1.00 Ordinary				100
	The Tesco Blue Limited Partnership	1		Limited Partnership			100	dunnhumby New Zealand				64			NZD 100.00 Ordinary				100
	The Tesco Navona Limited Partnership	1		Limited Partnership			100	dunnhumby Poland Sp. z o.o.				42			PLN 50,000 Ordinary				100
	The Tesco Passaic Limited Partnership	1		Limited Partnership			100	dunnhumby Russia LLC				79			RUB 1.00 Ordinary				100
	The Tesco Property Limited Partnership	1		Limited Partnership			100	dunnhumby Singapore Pte Ltd				19			SGD 1.00 Ordinary				100
	The Tesco Red Limited Partnership	1		Limited Partnership			100	dunnhumby SARL				61			€100.00 Ordinary				100
	TPI Fund Managers Limited	1		£1.00 Ordinary			100	dunnhumby Serviços de Promoço Digital Ltda				77			R$1.00 Ordinary				100
	TPT Holdco No.1 Limited	1		£1.00 Ordinary			100	dunnhumby Slovakia s.r.o.				58			No shares in issue				-
	Ventnor High Street Management Company Limited	1		Limited by Guarantee			-	dunnhumby Sp. z o.o.				47			PLN 50.00 Ordinary				100
	Weymouth Avenue (Dorchester) Limited	1		£1.00 Ordinary			100	dunnhumby Spain S.L				50			€1.00 Ordinary				100
	International subsidiary undertakings							dunnhumby South Africa (Pty) Ltd				43			No par value Ordinary				100
	Name of undertaking	Registered address		Class of share held			% held by Group	dunnhumby Ventures LLC				44			-				-
	Arena (Jersey) Management Limited†	33		£1.00 Ordinary			100	Edson Investments Limited				24			€2.00 Ordinary				100
	Cheshunt Holdings Guernsey Limited†	27		£1.00 Ordinary			100	Edson Properties Limited				24			€1.00 Ordinary				100
	Cheshunt Hungary Servicing	32		HUF 100,00 Quota			100	Ek-Chai Distribution System Co., Ltd.*				34			THB 10.00 Ordinary				100
	China Property Holdings (HK) Limited	20		HKD 1.00 Ordinary			100	ELH Insurance Limited				71			£1.00 Ordinary				100
	Chirac Limited	24		€1.25 Ordinary			100	Genesis sp. z o.o.				42			PLN 500.00 Ordinary				100
	Cirrus Finance (2009) Limited	24		£1,000 A Ordinary			100	Jasper Sp. z o.o.				42			PLN 100.00 Ordinary				100
				€1.00 Ordinary			100	Kabaty Investments Tesco (Polska) Sp. z o.o. Sp.k				42			PLN Partnership Interests				100
	Clondalkin Properties Limited	24		€1.25 Ordinary			100	Letňany Development land 1 s.r.o.				16			CZK 100,000 Ordinary				100
	Commercial Investmentment Limited	24		€1.25 Ordinary			100	Letňany Development land 2 s.r.o.				16			CZK 100,000 Ordinary				100
	Crest Ostrava a.s	16		CZK 100,000 Ordinary			100	Marine Coffee Company Holdings Limited				75			€1.00 Ordinary				100
	dunnhumby (Korea) Limited	66		KRW 5,000 Ordinary			100	Monread Developments Limited				24			€0.001 Ordinary				100
	dunnhumby (Malaysia) Sdn Bhd	84		RM 1.00 Ordinary			100	Nabola Development Limited				24			€1.25 A Ordinary				100
	dunnhumby (Thailand) Limited	73		THB 1,000,000 Ordinary			100								£1.25 B Ordinary				100
	dunnhumby Advertising (Shanghai) Co., Ltd	23		€130,000 Registered Capital			100	Orpingford Unlimited Company				24			€1.00 Ordinary				100
	dunnhumby Australia PTY Limited	65		AUD 100 Ordinary			100
	dunnhumby Brasil Consultora Ltda	77		BRL$1.00 Ordinary			100
	dunnhumby Canada Limited	59		CA$ 1.00 Ordinary			100
Name of undertaking			Registered address			Class of share held			% held by Group		Subsidiary undertakings in liquidation
PEJ Property Developments Limited			24			€1.00 Ordinary			100		The following subsidiary undertakings were incorporated in the United Kingdom
Pharaway Properties Limited			24			€1.00 Ordinary			100		Name of undertaking			Registered address			Class of share held		% held by Group
R.J.D. Holdings Unlimited			24			€1.269738 Ordinary			100		Adsega Limited†			9			£0.0026 Ordinary		100
Sociomantic Labs Internet Hizmetleri Limited Şireketi			51			TRY 25.00 Ordinary			100		Booker EBT Limited			9			£1.00 Ordinary		100
Tesco (Polska) Sp. z o.o.			42			PLN 500.00 Ordinary			100		Cullen's Holdings Limited			9			£0.0000000370 Ordinary		100
Tesco Akadémia Képzési és Fejlesztési Korátolt Felelősségű Társaság			32			HUF 1.00 Business Share			100		Cullen's Stores Limited			9			£0.00000161 Ordinary		100
Tesco Bengaluru Private Limited			41			INR 10.00 Ordinary			100		Cheshunt Finance Unlimited			9			£0.000000001 Ordinary		100
Tesco Capital No. 1 Limited†			28			£0.50 A Ordinary			100		Cheshunt Overseas LLP			9			Limited Liability Partnership		100
						£0.50 B Ordinary			100		dunnhumby Advertising Limited			9			£0.001 Ordinary		100
						£0,01 Preference - Guaranteed cumulative fixed rate preference					Europa Foods Limited			9			£0.000000176 Ordinary		100
						£0.01 Preferred Ordinary			100		Faraday Properties Limited			10			£0.000147 Ordinary		100
Tesco Capital No. 2 Limited			28			£0.01 Floating Rate Redeemable Preference†			100		Fresh Food Trader Limited			9			£1.00 Ordinary		50
						£1.00 Ordinary			100								£1.00 Preference		100
Tesco Chile Sourcing Limitada			22			CLP 1.00 Ordinary			100		Gibbs News Limited			9			£0.00001 Ordinary		100
						Ordinary US$ 1.00			100		NutriCentre Limited			9			£0.10 Ordinary		100
Tesco Digital Ventures Pte Ltd			49			SGD 1.00 Ordinary			100		Wm. Low Supermarkets Limited			10			£0.0000000180 Ordinary		100
Tesco Dystrybucja Sp. z o.o.			42			PLN 50.00 Ordinary			100		Halesworth SPV Limited			9			£1.00 Ordinary		100
Tesco Franchise Stores ČR s.r.o.			16			CZK 2,000,000 Ordinary			100		Harts the Grocers (Russell Square) Limited			9			£1.00 Ordinary		100
Tesco-Global Stores Privately Held Company Limited			32			HUF 10.00 Common			100		J.E. Cohen & Company Limited			9			£1.00 Ordinary		100
Tesco Global Employment Company Limited			34			THB 100.00 Ordinary			100		J.Smylie & Sons (IOM) Limited			72			£1.00 Ordinary		100
Tesco Guangdong (HK) Co. Limited			20			US$ 1.00 Ordinary			100		KSS Retail Limited			9			£0.000000851		100
Tesco Holdings B.V.			40			€1.00 Ordinary			100		Linebush IV Limited			9			£0.01 Ordinary A		100
Tesco International Clothing Brand s.r.o.			68			€1.00 Ordinary			100								£1.20 Ordinary B		100
Tesco International Franchising s.r.o.			58			€1.00 Ordinary			100								£0.01 Ordinary C		100
Tesco International Sourcing Limited			20			HKD 10.00 Ordinary			100		Linebush Limited			9			£0.01 A Ordinary		100
Tesco Ireland Holdings Limited			24			€1.25 Ordinary			100								£1.00 B Oridinary		100
Tesco Ireland Limited			24			€1.25 Ordinary			100								£0.01 C Ordinary		100
Tesco Ireland Pension Trustees Limited			24			€1.25 Ordinary			100		Linebush V Limited			9			£1.20 Ordinary A		100
Tesco Joint Buying Service (Shanghai) Co., Limited			82			US$ 1.00 Ordinary			100								£1.20 Ordinary B		100
Tesco Mobile (Thailand) Co. Limited			34			THB 100.00 Ordinary			100		London and Home Counties Superstores Limited			9			£1.00 Ordinary A		100
Tesco Mobile Ireland Limited			24			€1.00 Ordinary			100		M & W Limited			9			£0.0000000582261		100
Tesco Property (No. 1) Limited			28			£1.00 Ordinary			100		Morgam News Limited			9			£1.00 Ordinary		100
Tesco Sourcing India Private Limited			80			INR 10.00 Ordinary			100		Stewarts Supermarkets Limited			9			£1.00 Ordinary		100
Tesco Stores (Malaysia) Sdn Bhd*			86			RM 1.00 A Ordinary			100		Snowman Retail 1 Limited			9			£1.00 Ordinary		100
						RM 10.00 Non Convertible Non Cumulative Irredeemable Preference Shares			100		Tesco Treasury Services Limited†			9			£0.000001 Ordinary		100
						RM 1.00 B Ordinary			100		Tesco FFC Limited			9			£0.01 Ordinary		100
Tesco Stores (Thailand) Limited*			34			THB 10.00 A Ordinary			100		Tesco International Internet Retailing Limited			9			£0.0000013543		100
						THB 10.00 B Preference			<0.001		Tesco Kirkby (General Partner) Limited			9			£1.00 Ordinary		100
						THB 10.00 C Preference			100		Tesco Kirkby (LP) Limited			9			£1.00 Ordinary		100
Tesco Stores ČR a.s.			16			CZK 250 Ordinary			100		Tesco Kirkby (Unitholder1) Limited			9			£1.00 Ordinary		100
Tesco Stores SR, a.s.			81			€33,193.92 Ordinary			100		Tesco Kirkby (Unitholder2) Limited			9			£1.00 Ordinary		100
Tesco Trustee Company of Ireland Limited†			24			€1.25 Ordinary			100		Tesco TLB Barnstaple Limited			9			£1.00 Ordinary		100
TESCO Üzleti és Technológiai Szolgáltatások Zârtköruen Múködó Részvénytársaság			25			HUF 1.000.00			100		Tesco TLB Nottingham Limited			9			£1.00 Ordinary		100
Thundridge Unlimited			24			€1.00 Ordinary			100		Tesco TLB Pontypridd Limited			9			£1.00 Ordinary		100
Victoria BB Sp. z o.o.						PLN 800.00 Ordinary			100		Verulam Properties Limited			9			£1.00 Ordinary		100
Wanze Properties (Dundalk) Limited						€1.00 Ordinary			100
WSC Properties Limited						€0.0000005 Ordinary			100

 

The following subsidiary undertakings were incorporated outside of the United Kingdom				The following associated undertakings were incorporated outside of the United Kingdom
Name of undertaking	Registered address	Class of share held	% held by Group	Name of undertaking	Registered address	Class of share held	% held by Group
Avantil Services Company Limited	39	£1.00 Ordinary	100	Arena Unit Trust	33	-	50
Booker Cyprus Limited	21	€1.00 Ordinary	100	Booker India Private Limited	54	INR1.00 Ordinary	49
Saneyia Limited	21	€1.00 Ordinary	100	Booker Satnam Wholesale Private Limited	54	INR1.00 Ordinary	49
sociomantic Labs Private Limited	78	INR 10.00 Ordinary	100	China Wisdom dunnhumby Limited	53	RMB 264,000 Ordinary	50
Tesco Mauritius Holdings Limited	85	£1.00 Ordinary	100	China Wisdom dunnhumby (Shanghai) Limited	63	RMB 26,400,000	50
Tesco Vin Plus S.A.	52	€1.60 Ordinary	100	dunnhumby Mitsui Bussan Customer Science Co., Ltd	55	Common stock 1,000	50
				dunnhumby Norge A.S.	56	NOK 1,000 Ordinary	50
Associated undertakings				Merrion Shopping Centre Limited	24	€0.012697 Ordinary	51
The following associated undertakings were incorporated  in the United Kingdom				Retail Property Co., Limited*	83	THB 100.00 Ordinary A	100
Name of undertaking	Registered address	Class of share held	% held by Group	Synergistic Property Development Co. Limited	68	THB 100.00 Ordinary	50
Broadfields Management Limited	12	£0.10 Ordinary	35.3	Tesco General Insurance Broker Limited	45	THB100.00 Common	100
Clarepharm Limited	13	£0.10 Ordinary	26.5	Tesco Life Assurance Broker Limited	45	THB100.00 Common	100
Shire Park Limited	15	£0.10 Ordinary	54.5	Tesco Lotus Money Services Ltd	45	THB 100.00 Ordinary A	100
Tesco Coral (GP) Limited*	1	£1.00 A Ordinary	100	Tesco Lotus Retail Growth Freehold and Leasehold Property Fund	46	THB non par value listed	25
Tesco Coral (Nominee) Limited	1	£1.00 Ordinary	100	Tesco Mobile ČR s.r.o.	16	CZK 100,000 Ordinary	50
Tesco Dorney (GP) Limited*	1	£1.00 A Ordinary	100	Tesco Mobile Slovakia s.r.o.	81	€1.00 Ordinary	50
Tesco Dorney (Nominee 1) Limited	1	£1.00 Ordinary	100	Trent Hypermarket Private Limited	26	INR 10.00 Equity	50
Tesco Dorney (Nominee 2) Limited	1	£1.00 Ordinary	100
Tesco Dorney (Nominee Holdco) Limited	1	£1.00 Ordinary	100	Consolidated Structured Entities
Tesco Jade (GP) Limited	29	£1.00 A Ordinary	30	Name of undertaking	Registered address	Class of share held
		£1.00 B Ordinary	30	Delamare Cards Holdco Limited	85	Securitisation entity
Tesco Mobile Limited*	1	£0.10 A Ordinary	100	Delamare Cards MTN Issuer plc	85	Securitisation entity
		£0.90 B Ordinary	100	Delamare Cards Receivables Trustee Limited	85	Securitisation entity
Tesco Property (Sparta Nominees) Limited	1	£1.00 Ordinary	100	Delamare Cards Funding 1 Limited	85	Securitisation entity
Tesco Property (Nominees) (No.3) Limited	1	£1.00 Ordinary	100	Delamare Cards Funding 2 Limited	85	Securitisation entity
Tesco Property (Nominees) (No.4) Limited	1	£1.00 Ordinary	100	Delamare Finance PLC	11	Securitisation entity
Tesco Property Partner (GP No.2) Limited*	1	£1.00 A Ordinary	100	Delamare Group Holdings Limited	11	Securitisation entity
Tesco Sarum (GP) Limited*	1	£1.00 A Ordinary	100
Tesco Sarum (Nominee 1) Limited	1	£1.00 Ordinary	100
Tesco Sarum (Nominee 2) Limited	1	£1.00 Ordinary	100
Tesco Sarum (Nominee Holdco) Limited	1	£1.00 Ordinary	100
Tesco Underwriting Limited	31	£1.00 Ordinary	49.9
The Tesco Atrato Limited Partnership	1	Limited Partnership	50
The Tesco Coral Limited Partnership	1	Limited Partnership	50
The Tesco Dorney Limited Partnership	1	Limited Partnership	50
The Tesco Property (No.2) Limited Partnership	17	Limited Partnership	50
The Tesco Sarum Limited Partnership	1	Limited Partnership	50

1  Tesco House, Shire Park, Kestrel Way, Welwyn Garden City AL7 1GA, United Kingdom

2  Apex Road, Brownhills, Walsall, West Midlands WS8 7HU, United Kingdom

3  KPMG LLP, 15 Canada Square, London E14 5GL, United Kingdom

4  184 Shepherds Bush Road, London W6 7NL, United Kingdom

5  C/O   Morton   Fraser   LLP, 5th Floor, Quartermile Two, 2 Lister Square, Edinburgh, Scotland EH3 9GL, United Kingdom

6  2 South Gyle Crescent, Edinburgh, EH12 9FQ, United Kingdom

7  35 Great St Helen's, London EC3A 6AP, United Kingdom

8  Equity   House,   Irthlingborough Road, Wellingborough, Northamptonshire NN8 1LT, United Kingdom

9  Ernst & Young LLP, 1 More London Place, London, SE1 2AF, United Kingdom

10  Atria One, 144 Morrison Street, Edinburgh, EH3 8EX

11  40/14,   Hardengreen Business Park, Dalhousie Road, Eskbank, United Kingdom, EH22 3NU

12  2 Paris Parklands, Railton Road, Guildford, Surrey, GU2 9JX

13  Thompson Jenner, 28 Alexandra Terrace, Exmouth, Devon, EX8 1BD

14  Ritterstraße 6, 10969 Berlin, Germany

15  Riverside House 3 Place Farm, Wheathampstead, St. Albans, AL4 8SB, England

16  1527/68b, Vrsovicka, Praha 10, City of Prague, 100 00, Czech Republic

17  PO Box 87 22 Grenville Street, St Helier, Jersey

18  Yeni Havaalani Caddesi, No. 40 Cigli, Izmir, 35610 Turkey

19  30 A Tanjong Pagar Road, Singapore 088453, Singapore

20  31st Floor AIA Kowloon Tower Landmark East, 100 How Ming Street, Kowloon, Hong Kong

21  5 Esperidon Street, 4th floor, 2001 Strovolos, Nicosia, Cyprus

22  Avenida Santa María 5888, Piso 2 Zona A, Oficina 4, Vitacura, Santiago, 7660268, Chile

23  Room 886S, 8/F, 1111, Changshou Road, Jing'an District, Shanghai, People's Republic of China

24  Gresham House, Marine Road, Dun Laoghaire, Co. Dublin, Ireland

25  ll38 , Budapest, , Váci út, 187., Hungary

26  Taj   Building, 2nd Floor, 210, Dr D.N. Road, Fort, Mumbai, 400001, India

27  PO Box 25, Regency Court, Glategny Esplanade, St. Peter Port, Guernsey, GY1 3AP, Guernsey

28  Lime Grove House, Green Street, St Helier , Jersey , JE1 2ST, Jersey

29  20 Churchill Place, Canary Wharf, London E14 5HJ

30  c/o   RSM   Finland Oy, Ratamestarinkatu 7 B, 00520 Helsinki, Finland

31  Ageas House Hampshire Corporate Park, Templars Way, Eastleigh, Hampshire, SO53 3YA

32  H-2040 Budaörs, Kinizsi, ÚT 1-3, Hungary

33  47 Esplanade, St Helier, Jersey, JE1 0BD, Jersey

34  629/1 Nawamintr Road, Nuanchan, Buengkoom, Bangkok, , 10230, Thailand

35  c/o   The   Corporation Trust Company, 1209 Orange Street, Corporation Trust Center, Wilmington, DE 19801, USA

36  S-22 Greater Kailash, Part 1, Lower Ground Floor, New Delhi 110048, India

37  Carrera 48 no. 32B sur - 139, Envigado, Italy

38  9th   Floor,   Shiroyama Trust Tower, 3-1,, Toranomon 4-chome,, Minato-ku, Tokyo, Japan

39  38/39 Fitzwilliam Square, Dublin 2, Ireland

40  Danzigerkade   13H   2hg, 1013AP Amsterdam, Netherlands

41  81 & 82, EPIP Area, Whitefield, Bangalore, 560066, India

42  56 Kapelenka St, 30-347, Krakow, Poland

43  3rd   Floor,   54 Melrose Boulevard, Melrose Arch, Gauteng, 2196, South Africa

44  One   East Fourth Street, Suite 1400, Cincinnati, Ohio 45202, United States

45  87/1 Floor 10 Capital Tower, All Seasons Place, Wireless Road, Lumpini, Pathumwan, Bangkok, 10330, Thailand

46  1 Empire Tower, 32nd Floor, South Sathorn Road, Yannawa, Sathorn, Bangkok, 10120, Thailand

47  Sociomantic labs Sp z.o.o., ul. Pulawska 2,02 566 Warszawa, Poland

48  Av. El Golf 40, 7th floor, Las Condes, Santiago de Chile, Chile

49  163   Tras Street, #03-01, Lian Huat Building, Singapore, 079024, Singapore

50  Paseo de General Martinez Campos, Campos nº 9 1º izquierda, 28010 Madrid, Spain

51  Istiklal Caddesi Beyoglu Is Merkezi No: 187/5 Galatasaray, Istanbul, Turkey

52  Centre   de Commerces et de, Loisirs, Cite Europe, 62231 Coquelles, France

53  Suite 1106-8, 11/F., Tai Yau Building, No 181 Johnston Road, Wanchai, Hong Kong

54  Unit 607, 6th floor, Trade Centre, Bandra Kurla Complex, Bandra East, Mumbai, 400051, Maharashtra, India

55  1-2-3 Marunouchi, Chiyoda-ku, Tokyo, Japan

56  Rosenkrantzgate 16, Oslo, O160, Norway

57  c/o   TMF   Denmark A/S, Købmagergade 60, 1. tv., 1150 København K, Denmark

58  Cesta na Senec 2, Bratislava, 821 04, Slovakia

59  1400-340 Albert St, Ottawa ON K1R 0A5, Canada

60  4th Fl, Tower B, Paras Twin Towers, DLF Golf Course Road, Sector 54, Gurgaon, Haryana-HR, 122002, India

61  48 rue Cambon, 75001, Paris, France

62  Room 1001, Enterprise Development Tower, No. 398, Jiangsu Road Changning District, Shanghai 200050, People's Republic of China

63  Room 501-4, No.398 Jiangsu Road , Shanghai, People's Republic of China

64  RSM   New   Zealand, Level 2, 60 Highbrook Drive, Auckland, 2013, New Zealand

65  Level 21, 55 Collins Street, Melbourne, VIC 3000, Australia

66  13F   WeWork   Yeoksam Station 2,14, Teheran-ro 26-gil, Gangnam-gu, Seoul, 06236, Korea

67  Floor 3, 2 Harbour Square, Crofton Road, Dun Laoghaire, Dublin, Ireland

68  999/9,   31st Floor, Rama 1 Road, Pathumwan District, Bangkok, 10330, Thailand

69  Av President Masarik No. 111, Piso 1, Colina Polance V Seccion Delegacion Miguel Hidalgo, C.P. 11560, Mexico

70  Herikerberweg 238, Luna Arena 1101CM, Amsterdam, Zuidoost, Netherlands

71  Dorey Court, , Admiral Park, St. Peter Port, GY1 4AT, Guernsey

72  PO Box 237, Peregrine House, Peel Road, Douglas, Isle of Man, IM99 1SU

73  No. 319 Chamchuri Square Building, 16th Fl, Unit 01, 

Phayathi Road Pathumwan sub District, Bangkok 10330, Thailand

74  Calle 32 b sur #48-100, Envigado, Antioquia, Colombia

75  25-28 North Wall Quay, International Financial Services Centre, DUBLIN 1, Ireland

76  Paul-Lincke-Ufer 39/40, 10999 Berlin, Germany

77  Av.Brigadeiro Luis Antônio, 3530, 5° Andar, 01402-001 São Paulo, Brazil

78  C/o   Vaish Associates, 106, Peninsula Centre, Dr. S. S. Rao Road, Parel Mumbai

- 400012, Maharashtra, India

79  121099, Pereulok Spasopeskovskik 7/1 , Building 1, Moscow, Russian Federation

80  5th   Floor,   Unit 401, Tower B, The Millenia, No. 1&2 Murphy Road Ulsoor, Bangalore, 560 008, India

81  Einsteinova 24, Bratislava 851 01, Slovakia

82   Unit 01, 02, 06, 07, 08, 09, Floor 17, No. 610 Xujiahui Road, Huangpu District, Shanghai, People's Republic of China

83  313   CP Tower, Silom Road, Khwaeng Silom, Khet Bangrak, Bangkok, Thailand

84  Suite 13.03 , 13th Floor, Menara Tan & Tan, 207 Jalan Tun Razak, 50400 Kuala Lumpur, Malaysia

85  c/o   SGG   Corporate Services (Mauritius) Ltd, 33 Edith Cavell Street, Port Louis, 11324, Mauritius

86  Level 8, Symphony House,, Pusat Dagangan Dana 1,, Jalan PJU 1A/46, 47301 Petaling Jaya,, Selangor Darul Ehsan, Malaysia

Supplementary information (unaudited)

Total sales performance at actual rates (exc. VAT, exc. fuel)

	1Q	2Q	3Q	4Q	1H	2H	FY
	2019/20	2019/20	2019/20	2019/20(a)	2019/20	2019/20(a)	2019/20(a)
UK & ROI	1.2%	(0.9)%	0.2%	(0.1)%	0.2%	0.0%	0.1%
UK & ROI (comparable growth) (b)	0.1%	(0.9)%	0.2%	(0.1)%	(0.4)%	0.0%	(0.2)%
UK	(0.4)%	(1.4)%	(0.5)%	(0.3)%	(0.9)%	(0.4)%	(0.6)%
ROI	0.8%	0.3%	(0.4)%	(3.3)%	0.5%	(1.9)%	(0.7)%
Booker	3.1%	1.6%	4.3%	2.6%	2.3%	3.5%	2.9%
Central Europe	(10.8)%	(3.3)%	(15.9)%	(18.4)%	(7.0)%	(17.2)%	(12.1)%
Asia	7.3%	9.5%	9.7%	1.0%	8.4%	5.0%	6.7%
Tesco Bank	(1.9)%	7.5%	(5.2)%	(10.9)%	2.8%	(8.1)%	(2.6)%
Group	0.4%	(0.1)%	(0.8)%	(2.2)%	0.1%	(1.5)%	(0.7)%
Group (comparable growth) (b)	(0.5)%	(0.1)%	(0.8)%	(2.2)%	(0.3)%	(1.5)%	(0.9)%

Total sales performance at constant rates (exc. VAT, exc. fuel)

	1Q	2Q	3Q	4Q	1H	2H	FY
	2019/20	2019/20	2019/20	2019/20(a)	2019/20	2019/20(a)	2019/20(a)
UK & ROI	1.3%	(1.0)%	0.2%	0.1%	0.2%	0.2%	0.2%
UK & ROI (comparable growth)(b)	0.2%	(1.0)%	0.2%	0.1%	(0.4)%	0.2%	(0.1)%
UK	(0.4)%	(1.4)%	(0.5)%	(0.3)%	(0.9)%	(0.4)%	(0.6)%
ROI	2.7%	(1.4)%	0.7%	1.3%	0.6%	1.0%	0.8%
Booker	3.1%	1.6%	4.3%	2.6%	2.3%	3.5%	2.9%
Central Europe	(7.9)%	(4.7)%	(14.4)%	(13.7)%	(6.3)%	(14.0)%	(10.1)%
Asia	2.6%	(0.5)%	(0.1)%	(1.6)%	1.0%	(0.9)%	0.1%
Tesco Bank	(1.9)%	7.5%	(5.2)%	(10.9)%	2.8%	(8.1)%	(2.6)%
Group	0.4%	(1.2)%	(1.4)%	(1.7)%	(0.4)%	(1.6)%	(1.0)%
Group (comparable growth)(b)	(0.5)%	(1.2)%	(1.4)%	(1.7)%	(0.8)%	(1.6)%	(1.2)%

^(a)  4Q on a 13 weeks basis, 2H on a 26 weeks basis and FY on a 52 weeks basis.

^(b)  Comparable growth presents growth with Booker sales included in the prior year base using a comparable number of weeks. Booker sales growth was 12.4% for Q1 2019/20, 6.5% for 1H 2019/20 and 5.0% for FY 2019/20, reflecting 9 additional days of Booker sales in the current year.

Like-for-like sales performance (exc. VAT, exc. fuel)

	1Q	2Q	3Q	4Q	1H	2H	FY
	2019/20	2019/20	2019/20	2019/20	2019/20	2019/20	2019/20
UK & ROI	0.8%	(0.6)%	0.4%	0.3%	0.1%	0.4%	0.2%
UK	0.4%	(1.0)%	(0.4)%	(0.3)%	(0.3)%	(0.3)%	(0.3)%
ROI	1.3%	(1.0)%	2.0%	2.4%	0.1%	2.2%	1.2%
Booker	3.1%	1.9%	5.0%	3.5%	2.4%	4.2%	3.3%
Central Europe	(4.9)%	(1.4)%	(11.0)%	(8.7)%	(3.1)%	(9.8)%	(6.4)%
Asia	0.1%	(2.7)%	(1.6)%	(3.1)%	(1.3)%	(2.4)%	(1.9)%
Tesco Bank	n/a	n/a	n/a	n/a	n/a	n/a	n/a
Group	0.2%	(0.9)%	(0.9)%	(0.9)%	(0.4)%	(0.9)%	(0.6)%
Country detail - Retail
				Revenue (exc. VAT, inc fuel)*
				Local  Currency		Average exchange	Closing exchange
				(m)	£m	rate	rate
UK				44,302	44,302	1.0	1.0
ROI				2,746	2,392	1.1	1.2
Booker				6,204	6,204	1.0	1.0
Czech Republic				42,201	1,437	29.4	29.6
Hungary				557,052	1,479	376.6	393.8
Poland				7,144	1,451	4.9	5.0
Slovakia				1,381	1,203	1.1	1.2
Malaysia				4,593	867	5.3	5.4
Thailand				172,163	4,351	39.6	40.4
*  Excludes franchising revenue within Central Europe of £6m, which is not allocated to individual countries.

UK sales area by size of store

	29 February 2020				23 February 2019
Store size (sq. ft.)	No. of stores	Million sq. ft.		% of total sq. ft.	No. of stores	Million sq. ft.		% of total sq. ft.
0-3,000	2,508		5.4	14.0%	2,518		5.4	13.9%
3,001-20,000	284		3.0	7.8%	276		3.0	7.9%
20,001-40,000	284		8.2	21.3%	284		8.2	21.2%
40,001-60,000	182		8.8	22.9%	182		8.8	22.9%
60,001-80,000	120		8.4	21.8%	120		8.5	22.1%
80,001-100,000	45		3.7	9.6%	50		3.7	9.7%
Over 100,000	8		1.0	2.6%	8		0.9	2.3%
Total*	3,431		38.5	100.0%	3,438		38.5	100.0%

*  Excludes Booker and franchise stores.

Group space summary

Actual Group space - store numbers^(a)

	2018/19 year end	Openings	Closures/ disposals	Net gain/ (reduction)(b)	2019/20 year end	Repurposing/ extensions(c)
Large	797	2	(3)	(1)	796	-
Small(d)	1,855	72	(7)	65	1,920	-
Dotcom only	6	-	-	-	6	-
Total Tesco	2,658	74	(10)	64	2,722	-
One Stop(d)(e)	772	7	(82)	(75)	697	-
Booker	197	-	(1)	(1)	196	-
Jack's	8	5	(1)	4	12	-
UK(e)	3,635	86	(94)	(8)	3,627	-
ROI	152	-	(2)	(2)	150	-
UK & ROI(e)	3,787	86	(96)	(10)	3,777	-
Czech Republic(e)	188	-	(2)	(2)	186	10
Hungary	204	-	(2)	(2)	202	13
Poland	353	-	(24)	(24)	329	59
Slovakia	150	-	-	-	150	10
Central Europe(e)	895	-	(28)	(28)	867	92
Malaysia	73	2	-	2	75	5
Thailand	1,965	54	(31)	23	1,988	158
Asia	2,038	56	(31)	25	2,063	163
Group(e)	6,720	142	(155)	(13)	6,707	255
UK (One Stop)	174	35	(18)	17	191	-
Czech Republic	99	8	-	8	107	-
Franchise stores	273	43	(18)	25	298	-

 

Actual Group space - '000 sq.ft.^(a)

	2018/19 year end	Openings	Closures/ disposals	Repurposing/extensions(c)	Net gain/ (reduction)(b)	2019/20 year end
Large	31,368	34	(66)	-	(32)	31,336
Convenience(d)	5,097	149	(42)	-	107	5,204
Dotcom only	716	-	-	-	-	716
Total Tesco	37,181	183	(108)	-	75	37,256
One Stop(d)(e)	1,261	13	(135)	-	(122)	1,139
Booker	8,436	-	(60)	-	(60)	8,376
Jack's	81	74	(36)	-	38	119
UK(e)	46,959	270	(339)	-	(69)	46,890
ROI	3,335	-	(61)	-	(61)	3,274
UK & ROI(e)	50,294	270	(400)	-	(130)	50,164
Czech Republic(e)	4,602	-	(64)	(249)	(313)	4,289
Hungary	6,281	-	(6)	(275)	(281)	6,000
Poland	7,804	-	(977)	(1,154)	(2,131)	5,673
Slovakia	3,438	-	-	(258)	(258)	3,180
Central Europe(e)	22,125	-	(1,047)	(1,936)	(2,983)	19,142
Malaysia	3,533	50	-	(133)	(83)	3,450
Thailand	15,024	145	(67)	(644)	(566)	14,458
Asia	18,557	195	(67)	(777)	(649)	17,908
Group(e)	90,976	465	(1,514)	(2,713)	(3,762)	87,214
UK (One Stop)	227	34	(24)	-	10	237
Czech Republic	95	6	-	-	6	101
Franchise stores	322	40	(24)	-	16	338

^(a)  Continuing operations.

^(b)  The net gain/(reduction) reflects the number of store openings less the number of store closures/disposals.

^(c)  Repurposing of retail selling space.

^(d)  Included within openings and closures/disposals are 54 stores (113,065 sq.ft.) which were converted from One Stop stores into Tesco Express stores.

^(e)  Excludes franchise stores.

Group space forecast to 29 February 2020 - '000 sq. ft.^(a)

 

	2019/20 year end	Openings	Closures/ disposals	Repurposing/extensions	Net gain/ (reduction)	2020/21 year end
Large	31,336	12	-	-	12	31,348
Small	5,204	69	(29)	-	40	5,244
Dotcom only	716	-	-	-	-	716
Total Tesco	37,256	81	(29)	-	52	37,308
One Stop(b)	1,139	-	-	-	-	1,139
Booker	8,376	-	-	-	-	8,376
Jack's	119	96	-	-	96	215
UK(b)	46,890	177	(29)	-	148	47,038
ROI	3,274	59	-	6	65	3,339
UK & ROI(b)	50,164	236	(29)	6	213	50,377
Czech Republic(b)	4,289	14	(4)	(99)	(89)	4,200
Hungary	6,000	-	-	(147)	(147)	5,853
Poland	5,673	-	(715)	(418)	(1,133)	4,540
Slovakia	3,180	54	-	(78)	(24)	3,156
Central Europe(b)	19,142	68	(719)	(742)	(1,393)	17,749
Malaysia	3,450	94	-	-	94	3,544
Thailand	14,458	378	(48)	(464)	(134)	14,324
Asia	17,908	472	(48)	(464)	(40)	17,868
Group(b)	87,214	776	(796)	(1,200)	(1,220)	85,994
UK (One Stop)	237	-	-	-	-	237
Czech Republic	101	20	-	-	20	121
Franchise stores	338	20	-	-	20	358

^(a)  Continuing operations.

^(b)  Excludes franchise stores.

Tesco Bank income statement

	2020(a)  m	2019(a)(b) (restated) £m
Revenue Interest receivable and similar income Fees and commissions receivable	733 335	729 368
	1,068	1,097
Direct costs
Interest payable	(166)	(175)
Fees and commissions payable	(25)	(27)
	(191)	(202)
Gross profit	877	895
Other expenses
Staff costs	(164)	(170)
Premises and equipment	(72)	(80)
Other administrative expenses	(191)	(197)
Depreciation and amortisation	(78)	(85)
Impairment loss on financial assets	(179)	(164)
Operating profit before exceptional items	193	199
Exceptional items(c)	(119)	(30)
Operating profit	74	169
Net finance costs: movements on derivatives and hedge accounting	(11)	(4)
Net finance costs: interest	23	(6)
Share of profit/(loss) of joint venture	10	8
Profit for the year	96	167

^(a)  These results are for the 12 months ended 29 February 2020 and the previous period represents the 12 months ended 28 February 2019.

^(b)  Restated for the adoption of IFRS 16 as explained in Note 1 and Note 37 of the Group financial statements.

^(c)  Exceptional items in 2020 comprise of a PPI provision charge of £(45)m (February 2019: £(16)m), a restructuring charge of £(13)m (February 2019: credit of £2m),   accelerated amortisation and costs related to the sale of the mortgage book and PCA £(61)m (February 2019: £nil), and a regulatory provision of £nil (February 2019: £(16)m).

Glossary  

Introduction

In the reporting of financial information, the Directors have adopted various APMs.

These measures are not defined by International Financial Reporting Standards (IFRS) and therefore may not be directly comparable with other companies' APMs, including those in the Group's industry.

APMs should be considered in addition to, and are not intended to be a substitute for, or superior to, IFRS measurements.

Purpose

The Directors believe that these APMs assist in providing additional useful information on the underlying trends, performance and position of the Group.

APMs are also used to enhance the comparability of information between reporting periods and geographical units (such as like-for-like sales), by adjusting for non-recurring or uncontrollable factors which affect IFRS measures, to aid users in understanding the Group's performance.

Consequently, APMs are used by the Directors and management for performance analysis, planning, reporting and incentive-setting purposes.

Details of changes to APMs within the period can be found in Note 1.

Some of the Group's IFRS measures are translated at constant exchange rates. Constant exchange rates are the average actual periodic exchange rates for the previous financial period and are used to eliminate the effects of exchange rate fluctuations in assessing performance. Actual exchange rates are the average actual periodic exchange rates for that financial period.

APM	Closest equivalent IFRS measure		Adjustments to reconcile to IFRS measure		Definition and purpose
Income statement Revenue measures
Group sales	Revenue		-  Exclude sales made at petrol filling stations		-  Excludes the impact of sales made at petrol filling stations to demonstrate the Group's underlying performance in the core retail and financial services businesses by removing the volatilities associated with the movement in fuel prices. This is a key management incentive metric.
Growth in sales	No direct equivalent		-  Consistent with accounting policy		-  Growth in sales is a ratio that measures year-on-year movement in Group sales for continuing operations for 52 weeks. It shows the annual rate of increase in the Group's sales and is considered a good indicator of how rapidly the Group's core business is growing.
Like-for-like	No direct equivalent		-  Consistent with accounting policy		-  Like-for-like is a measure of growth in Group online sales and sales from stores that have been open for at least a year (but excludes prior year sales of stores closed during the year) at constant foreign exchange rates. It is a widely used indicator of a retailer's current trading performance and is important when comparing growth between retailers that have different profiles of expansion, disposals and closures.
Profit measures
Operating profit before exceptional items and amortisation of acquired intangibles	Operating profit*		-  Exceptional items -  Amortisation of acquired intangibles		-  Operating profit before exceptional items and amortisation of acquired intangibles is the headline measure of the Group's performance, and is based on operating profit from continuing operations before the impact of exceptional items and amortisation of intangible assets acquired in business combinations. Exceptional items relate to certain cost or incomes that derive from events or transactions that fall within the normal activities of the Group but which, individually or, if of similar type, in aggregate, are excluded by virtue of their size and nature in order to reflect management's view of the underlying performance of the Group. This is a key management incentive metric.
Retail operating profit	Operating profit*		-  Tesco Bank operating profit -  Retail exceptional items -  Retail amortisation of acquired intangibles		-  Retail operating profit is a measure of the Group's operating profit from continuing operations from the Retail business excluding Tesco Bank. It is based on Retail operating profit before exceptional items and amortisation of acquired intangibles.
Operating margin	No direct equivalent		-  Consistent with accounting policy		-  Operating margin is calculated as operating profit before exceptional items and amortisation of acquired intangibles divided by revenue. Progression in operating margin is an important indicator of the Group's operating efficiency.
Retail earnings before exceptional items, interest, tax, depreciation and amortisation (Retail EBITDA)	Operating profit*		-  Exceptional items -  Depreciation and amortisation -  Tesco Bank earnings before exceptional items, interest, tax, depreciation and amortisation -  Discontinued operations		-  This measure is based on Retail operating profit from continuing operations. It excludes Retail exceptional items, depreciation and amortisation and is used to derive the Total indebtedness ratio and Fixed charge cover APMs.

APM	Closest equivalent IFRS measure		Adjustments to reconcile to IFRS measure		Definition and purpose
Profit measures continued
Profit before tax before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements of financial instruments	Profit before tax		-  Exceptional items -  Amortisation of acquired intangibles -  Net pension finance costs -  Fair value remeasurements on financial instruments		-  This is a key management incentive metric. This measure excludes exceptional items and amortisation of acquired intangibles, net finance costs of the defined benefit pension deficit and fair value remeasurements of financial instruments. Net pension finance costs are impacted by corporate bond yields, which can fluctuate significantly and are reset each year based on often volatile external market factors. Fair value remeasurements are impacted by changes to credit risk and various market indices, which can fluctuate significantly. Also included in these items are fair value remeasurements of financial instruments resulting from liability management exercises.
Total finance costs before exceptional items, net pension finance costs and fair value remeasurements on financial instruments	Finance costs		-  Exceptional items -  Net pension finance costs -  Fair value remeasurements on financial instruments		-  Total finance costs before exceptional items, net pension finance costs and fair value remeasurements of financial instruments is the net finance costs adjusted for nonrecurring one-off items, net pension finance costs and fair value remeasurements of financial instruments. Net pension finance costs are impacted by corporate bond yields, which can fluctuate significantly and are reset each year based on often volatile external market factors. Fair value remeasurements are impacted by changes to credit risk and various market indices, which can fluctuate significantly. Also included in these items are fair value remeasurements of financial instruments resulting from liability management exercises.
Diluted earnings per share from continuing operations before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements on financial instruments	Diluted earnings per share		-  Exceptional items -  Amortisation of acquired intangibles -  Discontinued operations -  Net pension finance costs -  Fair value remeasurements on financial instruments		-  This relates to profit after tax before exceptional items and amortisation of acquired intangibles from continuing operations, net pension finance costs and fair value remeasurements attributable to owners of the parent divided by the weighted average number of ordinary shares in issue during the financial period adjusted for the effects of potentially dilutive share options. -  It excludes net pension finance costs and fair value remeasurements on financial instruments. Net pension finance costs are impacted by corporate bond yields, which can fluctuate significantly and are reset each year based on often volatile external market factors. Fair value remeasurements are impacted by changes to credit risk and various market indices, which can fluctuate significantly. Also included in these items are fair value remeasurements of financial instruments resulting from liability management exercises.
Tax measures
Effective tax rate before exceptional items and amortisation of acquired intangibles	Effective tax rate		-  Exceptional items and their tax impact -  Amortisation of acquired intangibles and their tax impact		-  Retail operating profit is a measure of the Group's Effective tax rate before exceptional items and amortisation of acquired intangibles is calculated as total income tax credit/(charge) excluding the tax impact of exceptional items and amortisation of acquired intangibles divided by profit before tax before exceptional items and amortisation of acquired intangibles. This provides an indication of the ongoing tax rate across the Group.
Effective tax rate before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements on financial instruments	Effective tax rate		-  Exceptional items and their tax impact -  Amortisation of acquired intangibles and their tax impact -  Net pension finance costs and their tax impact -  Fair value remeasurements on financial instruments and their tax impact		-  Effective tax rate before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements of financial instruments is calculated as total income tax credit/(charge) excluding the tax impact of exceptional items and amortisation of acquired intangibles items, net pension finance costs and fair value remeasurements divided by the profit before tax before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements.
Balance sheet measures
Net debt	Borrowings less cash and related hedges		-  Net debt from Tesco Bank		-  Net debt excludes the net debt of Tesco Bank but includes that of the discontinued operations to reflect the net debt obligations of the Retail business. Net debt comprises bank and other borrowings, lease liabilities, net derivative financial instruments, joint venture loans and other receivables and net interest receivables/payables, offset by cash and cash equivalents and short-term investments. It is a useful measure of the progress in generating cash and strengthening of the Group's balance sheet position and is a measure widely used by credit rating agencies.

 

APM	Closest equivalent IFRS measure		Adjustments to reconcile to IFRS measure		Definition and purpose
Balance sheet measures continued
Total indebtedness	Borrowings less cash and related hedges		-  Consistent with accounting policy		-  Total indebtedness is the net debt plus the IAS 19 deficit in the pension schemes (net of associated deferred tax) to provide an overall view of the Group's obligations. It is an important measure of the long-term obligations of the Group and is a measure widely used by credit rating agencies.
Total indebtedness ratio	No direct equivalent		-  Consistent with accounting policy		-  Total indebtedness ratio is calculated as Total indebtedness divided by the rolling 12-month Retail EBITDA. It is a measure of the Group's ability to meet its payment obligations and is widely used by analysts and credit rating agencies.
Fixed charge cover	No direct equivalent		-  Consistent with accounting policy		-  Fixed charge cover is calculated as the rolling 12-month Retail EBITDA divided by the sum of net finance cost (excluding net pension finance costs, finance charges payable on lease liabilities, exceptional items, capitalised interest and fair value remeasurements) and all lease liability payments. It is a measure of the Group's ability to meet its payment obligations and is widely used by analysts and credit rating agencies.
Cash flow measures
Retail operating cash flow	Cash generated from operating activities		-  Tesco Bank operating cash flow -  Discontinued operations		-  Retail operating cash flow is the cash generated from continuing operations, excluding the effects of Tesco Bank's cash flows. It is a measure of the cash generation and working capital efficiency by the Retail business, recognising that Tesco Bank is run and regulated independently from the Retail operations, and a key measure to demonstrate the recovery of the Retail operations. This is a key management incentive metric.
Free cash flow	Cash generated from operating activities		-  Net cash generated from/(utilised in) investing activities, and the market purchase of shares issued in relation to scheme schemes -  Repayment of obligations under leases -  Investing cash flows that increase items within Group net debt -  Cash flows from major corporate acquisitions and disposals		-  Free cash flow includes all cash flows from operating and investing activities, the market purchase of shares net of proceeds from shares issued in relation to share schemes, and repayment of obligations under leases. The following items are excluded: investing cash flows that increase/ decrease items within Group net debt, and cash flows from major corporate acquisitions and disposals. This measure reflects the cash available to shareholders.
Retail free cash flow	Cash generated from operating activities		-  Tesco Bank operating cash flow -  Retail net cash generated from/(used in) investing activities, and the market purchase of shares issued in relation to share schemes -  Repayment of obligations under leases -  Investing cash flows that increase/ decrease items within Net debt -  Cash flows from major corporate acquisitions and disposals		-  Retail free cash flow includes all cash flows from operating and investing activities for the Retail business, the market purchase of shares net of proceeds from shares issued in relation to share schemes, and the repayment of obligations under leases. The following items are excluded: investing cash flows that increase/decrease items within Net debt, and cash flows from major corporate acquisitions and disposals. This measure reflects the cash available to shareholders.

As detailed in the basis of consolidation, refer to Note 1, for the UK and the Republic of Ireland (UK & ROI), the results are for the 53 weeks ended 29 February 2020 (prior financial year 52 weeks ended 23 February 2019). For all other operations, the results are for the calendar year ended 29 February 2020 (prior calendar year ended 28 February 2019).

In order to provide comparability with the prior year results for the 52 weeks ended 23 February 2019, the tables below present the Group's statutory results on a 53 week basis to 29 February 2020, adjusted to remove the results of week 53 for the UK & ROI to also separately present the APMs on a 52 week basis to 22 February 2020. In determining the week 53 adjustment for the UK & ROI, revenue, sales and cost of goods sold represent the actual trading performance in that week, with overhead expenses allocated proportionally to week 53 based on the reported results for the 53 weeks to 29 February 2020. No week 53 adjustments are required with respect to the Group's operations in Central Europe, Asia or Tesco Bank which report on a calendar year basis.

APMs: Reconciliation of income statement measures

UK & ROI	Notes	2020 As reported on a 53 week basis £m	Exclude  week 53 £m	APM 2020 52 week basis  m	APM 2019 (restated) £m
Continuing operations
Group Sales	2	45,752	(843)	44,909	44,883
Revenue	2	52,898	(983)	51,915	51,643
Operating profit before exceptional items and amortisation of acquired intangibles	2	2,230	(46)	2,184	1,868
Operating margin	2	4.2%	-	4.2%	3.6%
Growth in sales at actual rates		2.0%	(1.9)%	0.1%	16.1%
Growth in sales at constant rates		2.1%	(1.9)%	0.2%	16.1%

Total Group	Notes	2020 As reported on a 53 week basis £m	Exclude week 53 £m	APM 2020 52 week basis £m	APM 2019 (restated) £m
Continuing operations
Group Sales	2	57,370	(843)	56,527	56,883
Revenue	2	64,760	(983)	63,777	63,911
Operating profit before exceptional items and amortisation of acquired intangibles	2	3,005	(46)	2,959	2,607
Operating margin	2	4.6%	-	4.6%	4.1%
Growth in sales at actual rates		1.1%	(1.8)%	(0.7)%	11.5%
Growth in sales at constant rates		0.8%	(1.8)%	(1.0)%	11.3%

APMs Reconciliation of income statement measures continued

	Notes	2020 As reported on a 53 week basis £m	Exclude week 53  m	APM 2020 52 week  basis £m	APM 2019 (restated) £m
Operating profit before exceptional items and amortisation of acquired intangibles (£m)	2	3,005	(46)	2,959	2,607
Share of post-tax profits/(losses) of joint ventures and associates before exceptional items and amortisation of acquired intangibles (£m)		26	-	26	21
Net finance costs before exceptional items and amortisation of acquired intangibles (£m)	5	(1,070)	27	(1,043)	(1,064)
Profit before tax from continuing operations before exceptional items and amortisation of acquired intangibles (£m)		1,961	(19)	1,942	1,564
Add: Net pension finance costs (£m)	5	71	-	71	89
Add/(less): Fair value remeasurements of financial instruments (£m)	5	244	(18)	226	153
Profit before tax from continuing operations before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements of financial instruments (£m)		2,276	(37)	2,239	1,806
Total income tax credit/(charge) before exceptional items, net pension finance costs and fair value remeasurements of financial instruments (£m)	9	(491)	7	(484)	(441)
Effective tax rate before exceptional items, net pension finance costs and fair value remeasurements of financial instruments (%)		21.6%	-	21.6%	24.4%
Profit before tax from continuing operations before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements of financial instruments attributable to the owners of the parent (£m)	9	2,273	(37)	2,236	1,806
Taxation on profit from continuing operations before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements of financial instruments attributable to the owners of the parent (£m)	9	(490)	7	(483)	(439)
Profit after tax from continuing operations before exceptional items and amortisation of acquired intangibles, net pension finance costs and fair value remeasurements of financial instruments attributable to the owners of the parent (£m)		1,783	(30)	1,753	1,367
Basic weighted average number of shares (millions)	9	9,716	-	9,716	9,686
Basic 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 (pence)		18.35	(0.31)	18.04	14.11
Diluted weighted average number of shares (millions)	9	9,783	-	9,783	9,758
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 (pence)		18.23	(0.31)	17.92	14.01

Retail EBITDA

	Notes	2020 As reported on a 53 week basis £m	Exclude week 53 £m	APM 2020 52 week basis £m	APM 2019 (restated) £m
Operating profit operations before exceptional items and amortisation of acquired intangibles	2	3,005	(46)	2,959	2,607
Less: Tesco Bank operating profit before exceptional items	2	(193)	-	(193)	(199)
Retail operating profit	2	2,812	(46)	2,766	2,408
Add: Depreciation and amortisation (excluding amortisation of acquired intangibles)	2	2,078	(29)	2,049	1,972
Less: Tesco Bank depreciation and amortisation	2	(141)	-	(141)	(85)
Retail EBITDA		4,749	(75)	4,674	4,295

APMs Reconciliation of balance sheet measures

Total indebtedness ratio

	Notes	2020 As reported on a 53 week basis	Exclude week 53	APM 2020 52 week basis	APM 2019
					(restated)
Net debt (£m)(a)(b)	32	12,298	(197)	12,101	13,204
Add: Defined benefit pension deficit, net of deferred tax (£m)(a)	29	2,573	-	2,573	2,338
Total indebtedness (£m)(a)		14,871	(197)	14,674	15,542
Retail EBITDA (£m)		4,749	(75)	4,674	4,295
Total indebtedness ratio		3.1	-	3.1	3.6

^(a)  Net debt, Total indebtedness and the defined benefit pension deficit, net of deferred tax on a 52 week basis are as at 22 February 2020.

^(b)  Free cash outflow in week 53 of £197m has been deducted from Net debt as at 29 February 2020 to determine the Group's 52 week Total indebtedness ratio.

Fixed charge cover

	Notes	2020 As reported on a 53 week basis £m	Exclude  week 53 £m	APM 2020	APM 2019
				52 week basis £m	(restated) £m
Net finance costs (£m)	5	1,221	(27)	1,194	1,064
Less: Net pension finance costs (£m)	5	(71)	-	(71)	(89)
Less: Exceptional fair value remeasurement loss on derivative restructuring (£m)	5	(180)	-	(180)	-
Add: Exceptional fair value remeasurement gain on Tesco Bank mortgage book disposal (£m)	5	29	-	29	-
Add: Fair value remeasurements of financial instruments (£m)	5	(244)	18	(226)	(153)
Total finance costs before exceptional items, net pension finance costs and fair value remeasurements of financial instruments (£m)		755	(9)	746	822
Add: Capitalised interest (£m)	5	-	-	-	1
Less: Finance charges payable on lease liabilities (£m)	12	(541)	6	(535)	(561)
Net finance cost, excluding net pension finance cost, exceptional items, capitalised interest, fair value remeasurements of financial instruments and finance charges payable on lease liabilities (£m)		214	(3)	211	262
Add: Retail total lease liability payments (£m)	12	1,170	-	1,170	1,163
		1,384	(3)	1,381	1,425
Retail EBITDA (£m)		4,749	(75)	4,674	4,295
Retail charge cover		3.4	-	3.4	3.0

APMs: Reconciliation of cash flow measures

	Notes	2020 As reported on a 53 week basis £m	Exclude  week 53 £m	APM 2020	APM 2019
				52 week basis £m	(restated) £m
Retail cash flows generated from operations excluding working capital	2	4,365	(63)	4,302	4,027
Retail (increase)/decrease in working capital	2	(124)	240	116	(390)
Retail operating cash flow	2	4,241	177	4,418	3,637
Retail interest and corporation tax paid*	2	(1,066)	27	(1,039)	(1,153)
Retail cash generated from/(used in) operating activities	2	3,175	204	3,379	2,484
Retail cash generated from/(used in) investing activities	2	(1,215)	(7)	(1,222)	(952)
Retail proceeds from issue of ordinary share capital	2	-	-	-	60
Retail own shares purchased	2	(149)	-	(149)	(206)
Retail repayments of obligations under leases	2	(632)	-	(632)	(605)
Add: Retail cash outflow from major acquisition	2	-	-	-	747
Less: Retail net investments in/(proceeds from sale of) short-term investments	2	687	-	687	(639)
Retail free cash flow	2	1,866	197	2,063	889
Tesco Bank free cash flow	2	476	-	476	(126)
Free cash flow		2,342	197	2,539	763

*  Retail interest paid in week 53 amounted to £27m.

Other .

Capital expenditure (Capex)

The additions to property, plant and equipment, investment property and intangible assets (excluding assets acquired under business combinations).

Capital employed

Net assets plus net debt plus dividend creditor less net assets of the disposal group and non-current assets classified as held for sale.

Enterprise Value

This is calculated as market capitalisation plus net debt.

EURIBOR

Euro Interbank Offered Rate.

FTE

FTE refers to full-time equivalents.

LIBOR

London Inter-Bank Offered Rate.

LPI

LPI refers to limited price inflation.

Market capitalisation

The total value of all Tesco shares calculated as total number of shares multiplied by the closing share price at year-end.

MTN

MTN refers to Medium Term Note.

MREL

Minimum Requirements for Own Funds and Eligible Liabilities (European Banking Authority).

Net Promoter Score (NPS)

This is a loyalty measure based on a single question requiring a score between 0-10. The NPS is calculated by subtracting the percentage of detractors (scoring 0-6) from the percentage of promoters (scoring 9-10). This generates a figure between -100 and 100 which is the NPS.

Return on capital employed (ROCE)

Return divided by the average of opening and closing capital employed.

Return

Profit before exceptional items and interest, after tax (applied at effective rate of tax).

RPI

RPI refers to the retail price index.

Total shareholder return

The notional annualised return from a share, measured as the percentage change in the share price, plus the dividends paid with the gross dividends, reinvested in Tesco shares. This is measured over both a one and five year period.

 

END

 

 

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