One of the world's largest retailers, with an unrivaled leading market position in the U.K. food-retail market; Superior operating performance and track record in the U.K. due to scale and a strategy based on business growth through sales and not margins; Well-diversified store portfolio with large percentage of freehold properties; and Successful diversification into the nonfood product categories. Intermediate financial risk profile owing to ongoing substantial investment in the U.K. and abroad; Persistent negative discretionary cash flow generation, but strong earnings growth mitigates rise in debt; and Increasing focus on shareholder value creation. The ratings on U.K.-based Tesco PLC reflect its leading market position and strong operating performance in the stable but highly competitive U.K. food retail market, with good
