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Tesco PLC  (OTCPK:TSCDY) Total Inventories: $2,876 Mil (As of Feb. 2017)

Tesco PLC's total inventories for the quarter that ended in Feb. 2017 was $2,876 Mil. Tesco PLC's average total inventories from the quarter that ended in Aug. 2016 to the quarter that ended in Feb. 2017 was $3,080 Mil.

In Ben Graham's calculation of liquidation value, inventory is only considered worth half of its book value. Tesco PLC's liquidation value for the quarter that ended in Feb. 2017 was $-37,550 Mil.

Inventory can be measured by days sales of inventory (DSI). Tesco PLC's days sales of inventory (DSI) for the six months ended in Feb. 2017 was 15.73.

Days Inventory indicates the number of days of goods in sales that a company has in the inventory. Tesco PLC's Days Inventory for the six months ended in Feb. 2017 was 16.64.

Inventory Turnover measures how fast the company turns over its inventory within a year. Tesco PLC's Inventory Turnover for the quarter that ended in Feb. 2017 was 10.97.

Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue. Tesco PLC's Inventory-to-Revenue for the quarter that ended in Feb. 2017 was 0.09.


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Tesco PLC Annual Data

Feb08 Feb09 Feb10 Feb11 Feb12 Feb13 Feb14 Feb15 Feb16 Feb17
Total Inventories Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5,795.67 5,920.53 4,535.28 3,471.43 2,876.25

Tesco PLC Semi-Annual Data

Aug07 Feb08 Aug08 Feb09 Aug09 Feb10 Aug10 Feb11 Aug11 Feb12 Aug12 Feb13 Aug13 Feb14 Aug14 Feb15 Aug15 Feb16 Aug16 Feb17
Total Inventories Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 4,535.28 4,081.00 3,471.43 3,283.09 2,876.25

Calculation

Total Inventories includes the raw materials, work-in-process goods and completely finished goods of a company. It is a portion of a company's current assets.


Explanation

Inventory control is an important part of business operation. If a company does not have enough inventory, it may not be able to meet customers' required delivery time. If it has too much inventory, the cost of holding the inventory can be high.

1. In Ben Graham's calculation of liquidation value, inventory is only considered worth half of its book value.

Tesco PLC's liquidation value for the quarter that ended in Feb. 2017 is

Liquidation value (Q: Feb. 2017 )
=Cash, Cash Equivalents, Marketable Securities-Total Liabilities+(0.75 * Accounts Receivable)+(0.5 * Total Inventories)
=8897.5-49268.75+0.75 * 1843.75+0.5 * 2876.25
=-37,550

2. Inventory can be measured by Days Sales of Inventory (DSI).

Tesco PLC's Days Sales of Inventory for the six months ended in Feb. 2017 is

Days Sales of Inventory (DSI)
=Total Inventories (Q: Feb. 2017 )/Revenue (Q: Feb. 2017 )*Days in Period
=3079.67152687/35723.75*365 / 2
=15.73

3. Days Inventory indicates the number of days of goods in sales that a company has in the inventory.

Tesco PLC's Days Inventory for the six months ended in Feb. 2017 is calculated as:

Days Inventory=Total Inventories (Q: Feb. 2017 )/Cost of Goods Sold (Q: Feb. 2017 )*Days in Period
=3079.67152687/33775*365 / 2
=16.64

4. Inventory Turnover measures how fast the company turns over its inventory within a year.

Tesco PLC's Inventory Turnover for the quarter that ended in Feb. 2017 is calculated as

Inventory Turnover=Cost of Goods Sold (Q: Feb. 2017 ) / Total Inventories (Q: Feb. 2017 )
=33775 / 3079.67152687
=10.97

5. Inventory-to-Revenue determines the ability of a company to manage their inventory levels. It measures the percentage of Inventories the company currently has on hand to support the current amount of Revenue.

Tesco PLC's Inventory to Revenue for the quarter that ended in Feb. 2017 is calculated as

Inventory-to-Revenue=Total Inventories (Q: Feb. 2017 ) / Revenue (Q: Feb. 2017 )
=3079.67152687 / 35723.75
=0.09

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Be Aware

Manufacturers with durable competitive advantages have the advantage that the products they sell do not change, and therefore will never become obsolete. Buffett likes this advantage.

When identifying manufacturers with durable competitive advantage, look for inventory and net earnings that rise correspondingly. This indicates that the company is finding profitable ways to increase sales which called for an increase in inventory.

Manufacturers with inventories that spike up and down are indicative of competitive industries subject to boom and bust.


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