There were calls last night for the FSA (or whatever succeeds it) to tighten up the rules on share sales, after Tesco’s Chief Operating Officer, Noel “Bob” Robbins (right) the UK chief operating officer, was discovered to have sold 50,000 shares on January 4 – a week before the company’s poor Christmas sales results stunned the market, knocking around 16% off the share price. Mr Robbins, whose net selling gain was £200,000, would only have made £166,000 had he waited until after the results announcement.
Bob (above) kitted out in full non-awareness parade uniform
The rules of officers of plc companies state they ‘should not buy or sell shares in their company while in possession of unpublished, price-sensitive information’. Somewhat incredibly, Tesco is arguing this morning that ‘Bob’ was not in possession such data. Their spin department this morning claimed, ‘We are confident that Bob was not in possession of any price-sensitive information at the time that the sale was approved.’
Are they kidding? Bob is the Chief Operating Officer of a retail company. If he didn’t have the running national till return totals before Christmas Day, then an awful lot of people should be fired for not telling him. Then he should be fired for not asking.
Over the last year, we have become used to utterly unbelievable bollocks being put out by The Greedy in defence of the indefensible.
But Tesco insists that it and Mr Robbins have broken no rules, and unfortunately they may be right: how easy it would be to simply change the rules to say that no officer can trade in the shares two months either side of a results announcement – and any officer found to have sold within a month before a profits warning should be ordered to sell the shares back at the post-warning price.
Bob’s little harvest came in just three days before the end of Tesco Christmas trading. Supermarket sales are Christmas biased, but (a) that’s just under 1% of total days in a year and (b) I can tell you from personal experience that the general trend is nearly always clear by December 22nd – depending on what day Christmas itself lands on.
Only three days ago, Tesco CEO Philip Clarke blamed “longstanding business issues” as a major factor in the seasonal sales performance. If Robbins didn’t know about that, why not?
And the same question should be asked of Messrs Andrew Higginson, Group Strategy director, who dumped a massive £1.41m of shares in November at 403.34p; and Finance Director Laurie McIlwee, who sold £545,000-worth in October at 411.51p.
There then followed an interim management statement on December 8. Hmm. Strategy….Financial….you know, it’s just possible they were aware of a thing or too as well – you never know. Nah, perish the thought.
Anyway, I think Robbins should resign.
The Slog has been running a concerted campaign to clean up Tesco’s act on misleading pack and price combinations. The campaign will continue at all levels.
You can read the Daily Dishonesty at @SlogTesco on Twitter.