Itv Plc Financial Ratios
ITV Plc is a company on UK london Stock Exchange. This report calculates it important financial ratios to give a pitcure of its financial position in the market comparing by comaparing it to its industry average.
From Annual report of year 2011 of ITV Plc .
Financial Performance Analysis:
This section aims to reflect the financial performance of the ITV Plc by analysing a range of financial ratios from the last two years. A comprehensive evaluation is provided of the significant ratios and later it is compared with its peers and sector ratios.
Liquidity Ratios
Basically the liquidity ratios are used to determine a company’s ability to cover its short term obligations when are in financial distress and these obligations are due. Liquidity Ratios | Ratios | Formula | 2011 | 2010 | Peer Average | Sector | Approach 1 | | | | | | Current Ratio | Current assets/ Current Liabilities | 1.96 | 1.93 | | 1.8x | Quick Ratio | Cash and accounts receivables/ Current Liabilities | 1.59 | 1.61 | | 1.5x | Approach 2 | | | | | | Average Collection period | {Accounts receivable/ Annual credit sales}*365 | 7.5 Days | | | | Account Receivables Turnover | | | | | 6.0x | Inventory Turnover | Cost of goods sold / Inventory | 5.79 times | 5.72 times | | No data avaliable |
Current Ratios
In current ratios the current assets are compared with current liabilities and depict the company’s ability to pay back its short term liabilities with its short term assets. The ratio shows a slight increase from year 2010 to 2011. ITV appears to be stronger than the industry average in covering its short term liabilities. ITV shareholders have little to worry about as the company is far from this risk of not meeting its short term financial obligations. This ratio here means that for every pound in current liabilities there is nearly £1.97 in current assets, hence ITV has sufficient funds for covering its short term liabilities.
Quick Ratios
From Annual report of year 2011 of ITV Plc .
Financial Performance Analysis:
This section aims to reflect the financial performance of the ITV Plc by analysing a range of financial ratios from the last two years. A comprehensive evaluation is provided of the significant ratios and later it is compared with its peers and sector ratios.
Liquidity Ratios
Basically the liquidity ratios are used to determine a company’s ability to cover its short term obligations when are in financial distress and these obligations are due. Liquidity Ratios | Ratios | Formula | 2011 | 2010 | Peer Average | Sector | Approach 1 | | | | | | Current Ratio | Current assets/ Current Liabilities | 1.96 | 1.93 | | 1.8x | Quick Ratio | Cash and accounts receivables/ Current Liabilities | 1.59 | 1.61 | | 1.5x | Approach 2 | | | | | | Average Collection period | {Accounts receivable/ Annual credit sales}*365 | 7.5 Days | | | | Account Receivables Turnover | | | | | 6.0x | Inventory Turnover | Cost of goods sold / Inventory | 5.79 times | 5.72 times | | No data avaliable |
Current Ratios
In current ratios the current assets are compared with current liabilities and depict the company’s ability to pay back its short term liabilities with its short term assets. The ratio shows a slight increase from year 2010 to 2011. ITV appears to be stronger than the industry average in covering its short term liabilities. ITV shareholders have little to worry about as the company is far from this risk of not meeting its short term financial obligations. This ratio here means that for every pound in current liabilities there is nearly £1.97 in current assets, hence ITV has sufficient funds for covering its short term liabilities.
Quick Ratios