Tesco is set to unveil its worst-ever performance in its almost 100-year history this week, which Clive Black of Shore Capital has said will be a “horror show” at a statutory level. The Times has reported the supermarket chain will also have to raise more cash to fill a £5bn black hole in its pension fund, according to a former Tesco adviser. JP Morgan Cazenove, Tesco’s corporate broker until 2013, said it found it difficult to believe that Tesco could continue to drive volumes, improve margins and pay down debt simultaneously without raising capital. “The most obvious solutions Tesco could opt for in order to strengthen its balance sheet are … either in the form of asset disposals or a potential share placing.” There has been much speculation in the City about whether Tesco CEO Dave Lewis will prefer to raise the money by selling off assets such as Dunnhumby and Giraffe or plump for a rights issues.

Lewis and Tesco are expected to reveal a loss for the year of between £4bn and £5bn thanks to falling sales, a £263m accounting scandal, a huge pension deficit and a massive write down of the company’s property estate, which analysts are tipping to come in at about £4 billion (The Financial Times £).

However, the results will mark an end to the retailer’s most miserable year on record and let Lewis get on with delivering his turnaround plan. Andrew Clark of The Times says even though there will be pain, investors shouldn’t panic. “Dave Lewis has made quick and impressive headway in improving the basics in stores,” he added. The bottom line will be dreadful but Tesco, like rivals Sainsbury’s and Morrisons, has to devalue its property portfolio has it halts store openings and closes 43 shops. “Make no mistake, this turnaround that will take years, but Mr Lewis’s approach of beginning with basic common sense in the stores is a decent one,” Clark said.

Birds Eye owner Iglo is set to be gobbled up by Nomad Foods for €2.6bn, according to people familiar to the matter. The Financial Times (£) said the expected deal, which could be announced as early as today, would be the latest transaction in a series in Europe as boardroom confidence grows.

As reported in this week’s The Grocer, the Co-operative Group has told its members it can’t make an enhanced commitment to stock Fairtrade products because of tough competition among supermarkets and its shift towards convenience stores. Chairman Allan Leighton blamed financial position and an “austere market climate” (The Guardian).