Financial Ratio Analysis Performance Report Essay Example
1.0 Executive Summary
This report provides an analysis and compare of the current profitability, efficiency and financial stability of Premier Investments Ltd and David Jones Ltd over last 2 years. Methods of analysis include trend, horizontal and vertical analyses as well as ratios such as Gross Net profit margin, Inventory turnover and Current ratios. All calculations can be found in the appendices. Results of data analysed show that David Jones Ltd have better performance and is more stability than Premier Investments Ltd. In particular, Premier Investments Ltd’s profit had dropped almos half than the year before.The report finds the prospects of both companies in their current position are pretty positive. The major areas of weakness require further investigation and remedial action by management. Recommendations discussed include:
Improving/increasing the profit of Premier Investments Ltd
Improving the return on equity, return on assets of Premier Investments improving/increasing inventory turnover of David Jones Ltd
The report also investigates the fact that the analysis conducted has limitations. Some of the limitations include: Timing, Information base and End use.
Table of Contents
1.0 executive summary 1
2.0 introduction 3
3.0 Body of report 4
3.1 Profitability 4
3.2 Efficiency 6
3.3 Financial Stability 8
4.0 Additional information 10
5.0 limitations 12
6.0 conclusion and recommendations 11
7.0 references 13
8.0 APPENDICES………………………………………………………………………………………….............14
2.0 Introduction
This report tends to analyse two organizations working in different industries. The purpose of this report is to conduct a ratio analysis of the two companies, and evaluate which of them is in a better and more stable financial position. For this purpose the report focuses on several profitability, efficiency and liquidity ratios. The ratios will be analysed on the basis of a comparison
This report provides an analysis and compare of the current profitability, efficiency and financial stability of Premier Investments Ltd and David Jones Ltd over last 2 years. Methods of analysis include trend, horizontal and vertical analyses as well as ratios such as Gross Net profit margin, Inventory turnover and Current ratios. All calculations can be found in the appendices. Results of data analysed show that David Jones Ltd have better performance and is more stability than Premier Investments Ltd. In particular, Premier Investments Ltd’s profit had dropped almos half than the year before.The report finds the prospects of both companies in their current position are pretty positive. The major areas of weakness require further investigation and remedial action by management. Recommendations discussed include:
Improving/increasing the profit of Premier Investments Ltd
Improving the return on equity, return on assets of Premier Investments improving/increasing inventory turnover of David Jones Ltd
The report also investigates the fact that the analysis conducted has limitations. Some of the limitations include: Timing, Information base and End use.
Table of Contents
1.0 executive summary 1
2.0 introduction 3
3.0 Body of report 4
3.1 Profitability 4
3.2 Efficiency 6
3.3 Financial Stability 8
4.0 Additional information 10
5.0 limitations 12
6.0 conclusion and recommendations 11
7.0 references 13
8.0 APPENDICES………………………………………………………………………………………….............14
2.0 Introduction
This report tends to analyse two organizations working in different industries. The purpose of this report is to conduct a ratio analysis of the two companies, and evaluate which of them is in a better and more stable financial position. For this purpose the report focuses on several profitability, efficiency and liquidity ratios. The ratios will be analysed on the basis of a comparison