LONDON, October 23 (RIA Novosti) – Chairman of UK retailer Tesco Sir Richard Broadbent will resign in light of a large-scale profit forecast error, the company said Thursday in its Interim Results 2014/15 report.
"I will begin now to prepare the ground to ensure an orderly process for my own succession at that time," Broadbent said.
"My decision reflects the important principle of accountability on behalf of the Board and will support the company to draw a line under the past as it enters the next phase of its development," he said.
Broadbent said that the company acted quickly to clarify its financial performance, and a new management team was already in place to address the causes of the error and to develop a strategy to improve Tesco's position.
The supermarket chain confirmed that its profits were overstated by 263 million pounds ($421 million) instead of the 250 million pounds reported earlier.
Tesco also reported a 92 percent drop in pre-tax profits and said that the accounting black hole in the company's profits was larger than projected.
On September 22, Tesco launched a probe into its accounting practices after the issue with profit forecast overstatement was uncovered. Back in July, Tesco chief executive Philip Clarke was forced to leave his post after leading the company through three years of losses.
Tesco, founded in London in 1919, is a multinational grocery and retailer based in Cheshunt, Hertfordshire. The company currently operates some 6,500 stores worldwide.
