Tesco 2010 Annual Report Download - page 10

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resultspresentation
8 Tesco PLC Annual Report and Financial Statements 2010
Chief Executive’s
review
business by 2050; to reduce the
carbon impact of the products in our
supply chain by 30% by 2020; and to
help our customers halve their own
carbon footprint by 2020. And we’re
making good progress already.
We’re delivering for all stakeholders:
an improved shopping trip for
customers; training and good careers
for our staff; growth and innovation
with our suppliers; in local communities
we’re supporting causes that matter
to customers; and we’re delivering
good returns to shareholders.
Looking forward
The outlook for shareholder returns
is encouraging: we have a strong
core UK business growing well; our
international businesses offer significant
upside from recovery in the short
term and maturity in the longer term;
our balance sheet is strengthening;
and we’re creating value through
good property development.
Our positions in high-growth
international economies and non-food
meant we were always likely to face
strong headwinds during the recession
but it will be these parts of our business
which will grow fastest in the recovery
and beyond.
I am confident that with the prospect
of an improving global economy and
recent investments in acquisitions and
new selling space making a greater
contribution going forward, returns
will improve significantly – starting
this year.
Sir Terry Leahy
Chief Executive
Each element of our strategy – UK,
International, Non-food, Retailing
Services and Community – is stronger
now than this time last year.
In International, our businesses have
made good progress in a challenging
global economic environment. Our
strategy is working – we’ve grown
sales, profits and market shares and
we’ve continued to invest in the drivers
of future growth. Our performance
in Asia was particularly pleasing,
our business in Europe held up
well despite the obvious economic
challenges and I believe the start-up
losses in our US business will now
begin to reduce as Fresh & Easy
establishes itself.
Our UK business had a good year.
By remaining focused on helping
customers spend less and encouraging
loyalty with an increased investment
in Clubcard, our UK business has
delivered a solid performance. In our
core grocery operations, we’re growing
ahead of the industry as a whole and
we have been less affected by falling
inflation than the market at large.
In Non-food we have made good
progress. In the UK we achieved a
particularly strong performance in
electricals, entertainment and toys.
Our clothing range is becoming an
international success, led by our F&F
range which is growing rapidly in our
European markets and this year was
launched in four countries in Asia.
Our Retailing Services have grown
sales and profits once again. We’ve
also been building the platforms for
future growth, particularly in Tesco
Bank, which is making good progress
in developing its own systems and
people capabilities as well as working
on a broader product range as it
moves towards becoming a full-
service retail bank.
In the same way that we’ve stuck
to our strategy in other parts of
the business, we’ve also remained
committed to our work on Community
and the environment. In October, we
set ourselves three challenging long-
term targets: to become a zero-carbon
This year’s results show another
solid performance from across
the Group. By staying focused
on doing the right thing for
customers we have weathered
the economic storm well. And by
remaining committed to our long-
term strategy we are emerging
from recession stronger – with
good building blocks in place
for future growth.