Irish staff don't proceed to check out Tesco share offering
Tesco's Irish staff have shunned their own employer's shares as the retail giant suffered an accounting scandal, a slump on the stock market, and a sales decline.
Thousands of eligible Irish staff exercised a total of just 6,521 share options during the 12 months to February 28. At an average weighted price of £3.11 each, that amounted to just £20,500 (€28,500).
Any employee who exercised those options at that price is already sitting on a loss. Tesco shares are currently trading at just £2.20.
Details of the share take-up by Irish staff were revealed in Tesco's annual report, which was published yesterday.
In the previous financial year, Tesco employees had exercised options over 200,710 shares with an average weighted price of £3.18 each, valued at a total of £638,257 (€896,000).
The annual report also shows that Tesco's staff in Ireland may fare better in coming years. In February last year, there were almost 4.9m shares outstanding under the Irish savings-related share options scheme.
Tesco granted an additional 4.96m options to the scheme in the last financial year, with an average weighted price of just £1.50.
The group employs about 15,000 people in Ireland. It's thought that more than 4,000 of those are members of the share scheme, which enables them to set aside money to buy shares in the group at a discounted price.
The retailer, the joint biggest grocery business in Ireland along with Musgrave's SuperValu, has endured a difficult time here in the past couple of years.
Like-for-like sales in Ireland, including fuel but excluding VAT, fell 6.4pc in the last financial year to €2.55bn from €2.69bn. The chain has faced strong discounter pressure.
Tesco also unveiled a new structure for its executive bonus plan yesterday.
The structure will focus on bonuses more linked to sales growth rather than short-term profit.