Tesco 2004 Annual Report Download - page 8

6TESCO PLC
DIRECTORS’ REPORT
COMPANY’S SHAREHOLDERS The company is not aware of any
ordinary shareholders with interests of 3% or more.
DIRECTORS AND THEIR INTERESTS The names and biographical
details of the present Directors are set out in the separately
published Annual Review and Summary Financial Statement 2004.
Mr R W P Brasher, Mr E M Davies, Mr K J Hydon and Mr D
E Reid were appointed to the Board in the last twelve months
and, as required by the Articles of Association, offer themselves
for election. Mr C L Allen, Mr P A Clarke, Dr H Einsmann,
Ms V Morali and Mr G F Pimlott 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 Report of the Directors on
Remuneration set out on pages 13 to 23.
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.
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 Tesco success.
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 gender, marital status, race, age, sexual orientation 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 UK staff magazine called one team and the equivalents in our
overseas businesses, videos and staff brieÞng 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.
The Directors present their annual report to shareholders on
the affairs of the Group, together with the audited consolidated
financial statements of the Group for the 53 weeks ended
28 February 2004.
PRINCIPAL ACTIVITY AND BUSINESS REVIEW The principal activity
of the Group is the operation of food stores and associated
activities in the UK, Republic of Ireland, Hungary, Poland, Czech
Republic, Slovakia, Thailand, South Korea, Taiwan and Malaysia.
During the year, we entered the Turkish and Japanese markets.
A review of the business is contained in the Annual Review
and Summary Financial Statement 2004 which is published
separately and, together with this document, comprises the full
Tesco PLC Annual Report and Financial Statements.
GROUP RESULTS Group sales including VAT rose by £5,277m to
£33,557m, representing an increase of 18.7%. Group underlying
profit on ordinary activities before taxation, net loss on disposal
of fixed assets, integration costs and goodwill amortisation was
£1,708m, compared with £1,401m for the previous year, an
increase of 21.9%. Including net loss on disposal of fixed assets,
integration costs and goodwill amortisation, Group profit on
ordinary activities before taxation was £1,600m. The amount
allocated to the employee profit-sharing scheme this year was
£57m as against £51m last year. After provision for tax of
£498m, minority interests of £2m and dividends, paid and
proposed, of £516m, profit retained for the financial year
amounted to £584m.
DIVIDENDS The Directors recommend the payment of a final
dividend of 4.77p per ordinary share to be paid on 25 June
2004 to members on the Register at the close of business on
30 April 2004. Together with the interim dividend of 2.07p per
ordinary share paid in November 2003, the total for the year
will be 6.84p compared with 6.20p for the previous year, an
increase of 10.3%.
TANGIBLE FIXED ASSETS Capital expenditure amounted to £2,285m
compared with £2,134m the previous year. In the Directors
opinion, the properties of the Group have a market value in
excess of the book value of £12,009m included in these financial
statements.
SHARE CAPITAL The authorised and called-up share capital of the
company, together with details of the shares allotted during the
period, are shown in note 24 to the financial statements. Details
of investments held in Tesco PLC are shown in note 14 in the
financial statements.