Tesco 2008 Annual Report Download - page 20

Tesco PLC Annual Report and
Financial Statements 2008
18
General information
Principal activity, business review and future developments The
principal activity of the Group is retailing and associated activities in the
UK, the Republic of Ireland, Hungary, Poland, the Czech Republic, Slovakia,
Turkey, Thailand, South Korea, Malaysia, Japan, China and the US.
For a review of the business of the Group including: a description of the
key activities, future developments and an analysis of the key risks and
uncertainties (including financial risk management strategy), see the
Business Review on pages 3 to 17 of this document.
Group results Group revenue rose by £4.7bn to £47.3bn, representing
an increase of 11%. Group profit before tax increased by £150m, to
£2,803m. Profit for the year was £2,130m, of which £2,124m was
attributable to equity holders of the Parent Company.
Dividends The Directors recommend the payment of a final dividend
of 7.70p per ordinary share, to be paid on 4 July 2008 to members on
the Register at the close of business on 25 April 2008. Together with the
interim dividend of 3.20p per ordinary share paid in December 2007, the
total dividend for the year will be 10.90p compared with 9.64p for the
previous year, an increase of 13.1%.
Fixed assets Capital expenditure (excluding business combinations)
amounted to £3.9bn compared with £3.0bn the previous year. In the
Directors’ opinion, the properties of the Group have a market value in
excess of the carrying value of £16.9bn included in these financial
statements. In the year we received net proceeds of approximately £860m
from our new property joint venture with The British Land Company PLC
and property disposals to Prudential plc.
Share capital The authorised and called-up share capital of the Company,
together with details of the shares allotted and bought back during the
year, are shown in note 25 of the financial statements. Details of treasury
shares held by Tesco PLC are shown in note 26 of the financial statements.
Company’s shareholders The Company has been notified that as at
the date of this report, the following shareholders own more than 3%
of the issued share capital of the Company:
Legal & General Assurance (Pensions Management Limited) 4.97%
Barclays 4.29% (Barclays Global Investors – 1.72%, Barclays PLC – 2.57%)
Except for the above, the Company is not aware of any ordinary
shareholders with interests of 3% or more in the issued share capital
of the Company.
Articles of Association The Company’s Articles of Association may only
be amended by special resolution at a General Meeting of the shareholders.
Directors and their interests The Directors who served during the
year were:
> Mr D E Reid; > Mr D T Potts;
> Mr R F Chase CBE; > Mr C L Allen CBE;
> Sir Terry Leahy; > Mrs K Cook;
> Mr R Brasher; > Mr E M Davies CBE;
> Mr P A Clarke; > Dr H Einsmann;
> Mr A T Higginson; > Mr K J Hydon;
> Mr T J R Mason; > Ms C McCall; and
> Miss LNeville-Rolfe CMG.
Ms McCall resigned from the Board on 10 April 2008.
The biographical details of the present Directors are set out in the
separately published Annual Review and Summary Financial Statement 2008.
Mr Allen, Mr Chase, Mrs Cook, Dr Einsmann, Sir Terry Leahy and Mr Mason
retire from the Board by rotation and, being eligible, offer themselves for
re-election. The interests of Directors and their immediate families in the
shares of Tesco PLC, along with details of Directors’ share options, are
contained in the Directors’ Remuneration Report set out on pages 25 to 38.
At no time during the year did any of the Directors have a material interest
in any significant contract with the Company or any of its subsidiaries.
A qualifying third-party indemnity provision as defined in Section 309 B (1)
of the Companies Act 1985 is in force for the benefit of each of the
Directors and the Company Secretary (who is also a Director of certain
subsidiaries of the Company) in respect of liabilities incurred as a result
of their office, to the extent permitted by law. In respect of those liabilities
for which Directors may not be indemnified, the Company maintained a
Directors’ and officers’ liability insurance policy throughout the financial year.
Employment policies The Group depends on the skills and commitment
of its employees in order to achieve its objectives. Staff at every level are
encouraged to make their fullest possible contribution to the success of
Tesco. A key business priority is to deliver an ‘Every little helps’ shopping
experience for customers. Ongoing training programmes seek to ensure
that employees understand the Group’s customer service objectives and
strive to achieve them. The Group’s selection, training, development and
promotion policies ensure equal opportunities for all employees regardless
of factors such as gender, marital status, race, age, sexual preference and
orientation, colour, creed, ethnic origin, religion or belief, or disability.
All decisions are based on merit.
Internal communications are designed to ensure that employees are well
informed about the business of the Group. These include a new staff
newspaper ‘The One’ and the equivalents in our overseas businesses,
videos and staff briefing sessions. Staff opinions are frequently researched
through surveys and store visits. We work to deliver ‘Every little helps’ for
all our people across the Group. Employees are encouraged to become
involved in the financial performance of the Group through a variety of
schemes, principally the Tesco employee profit-sharing scheme (Shares in
Success), the savings-related share option scheme (Save As You Earn) and
the partnership share plan (Buy As You Earn).
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