Tesco div­i­dend tipped to re­turn af­ter hia­tus

The Sunday Telegraph - Money & Business - - Front page - By Ash­ley Arm­strong

TESCO chief Dave Lewis will this week at­tempt to con­firm the su­per­mar­ket gi­ant’s come­back by restor­ing its div­i­dend, even as the al­leged “colos­sal fraud” that blew a hole in its fi­nances is laid bare in court.

Mr Lewis, who was drafted in to lead Tesco three years ago af­ter in­ves­ti­ga­tors un­cov­ered hun­dreds of mil­lions of pounds of miss­ing prof­its, scrapped the div­i­dend months into his reign to help re­pair the bal­ance sheet. Its ex­pected re­turn as part of Tesco’s half-year re­sults on Wed­nes­day comes as in­vestor nerves are tested by the high-pro­file trial of three for­mer se­nior ex­ec­u­tives ac­cused of mas­ter­mind­ing a scheme to “cook the books”.

The trial of Christo­pher Bush, Tesco UK’S for­mer man­ag­ing di­rec­tor, Carl Rog­berg, the com­pany’s for­mer UK fi­nance di­rec­tor, and John Scouler, for­mer food com­mer­cial di­rec­tor, be­gan on Fri­day. Bruno Monteyne, an an­a­lyst at Bern­stein, has said that, while the size of any div­i­dend may be small, it will be “im­por­tant sym­bol­i­cally”.

The City ex­pects Bri­tain’s big­gest re­tailer to un­veil half-year sales that have nudged 3pc higher to £28.1bn while op­er­at­ing prof­its are fore­cast to have edged 2pc lower to £502m.

Mr Lewis and fi­nance boss Alan Ste­wart will ben­e­fit as they de­ferred re­spec­tive £860,000 and £424,000 share awards un­til 2019 or “un­til the re­sump­tion of div­i­dend pay­ments”.

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