Financial analysis of nestle group from 2007 to 2016.

1. SUBMITTED TO - DR. SUNIL VERMA
PROFESSOR OF BUSINESS FINANCE
SGT UNIVERSITY, GURUGRAM
SUBMITTED BY-NISHA KHANAL
SECTION-A BBA(G)
ROLL NO.-160604046 1

2. S.NO HEADINGS 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
1 CURRENT ASSETS 35770 33048 39870 38997 33324 35205 30066 33961 29434 32042
2 CURRENT LIABILITY 43326 33223 36083 30149 35232 38753 35400 32521 33321 37517
3 CASH 6594 5835 2734 8057 4938 5840 6415 7448 4884 7990
4 SHORT TERM INVESTMENT 2902 1296 2585 8189 3050 3585 638 1433 921 1306
5 RECEIVEABLES 14890 13442 12309 12083 1340 13404 12206 13459 12252 12411
6 TOTAL DEBT 21399 20216 36437 32692 35891 42032 37815 38643 38268 41838
7 TOTAL ASSETS 115361 106215 110916 111641 114091 126229 120442 133450 123992 131901
8 AVERAGE TOTAL ASSETS 57680.5 53107.5 55458 55820.5 57045.5 63114.5 60221 66725 61996 65950.5
9 LONG TERM DEBT 7220 7608 8966 7483 6207 9009 10363 12396 11601 11091
10 TOTAL SHAREHOLDERS' EQUITY 54776 54916 53631 62598 65382 126229 64139 71884 63986 65981
11 GROSS PROFIT 15024 15676 15699 16194 12538 14012 14047 14019 13382 13693
12 TOTAL REVENUE 107552 109908 107618 109722 83770 92324 92373 91865 89083 89786
13 OPERATING PROFIT 1434 22978 14970 38820 12471 13932 13068 10905 12408 13163
14 NET PROFIT 11382 19051 11793 35384 9804 11060 10445 14904 9467 8883
15 EARNING BEFORE TAX 13518 21833 14355 38067 12050 13451 12437 10268 11784 12526
16 OPERATING INCOME 108247 119334 108127 134463 83754 92332 92774 91766 88911 89823
NOTE: AMOUNT IN MILLION
2

3. S.NO HEADINGS 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
1 RECEIVABLE TURN OVER RATIO 1.864616 2.069538 1.940532 1.965622 1.46847 1.462802 1.5339 1.37677
1.43691
5 1.36142
2 CURRENT RATIO 0.825601 0.994733 1.104952 1.293476 0.94584 0.908446 0.849322 1.044279
0.88334
7 0.85407
3 QUIKRATIO 0.562849 0.61924 0.48854 0.939633 0.26475 0.58909 0.54404 0.686941
0.54191
1 0.57859
4 CASH RATIO 0.219176 0.21464 0.14741 0.538857 0.22672 0.243207 0.199237 0.273085
0.17421
4 0.24778
5 DEBT TO ASSETS RATIO 0.185496 0.190331 0.32851 0.292831 0.31458 0.332982 0.313969 0.289569
0.30863
3 0.31719
6
LONG TERM DEBT TO ASSETS
RATIO 0.062586 0.071628 0.080836 0.067027 0.05440 0.07137 0.086041 0.092889
0.09356
2 0.08409
7 FINANCIAL LEVERAGE RATIO 2.10605 1.934136 2.068132 1.78346 1.74499 1 1.877828 1.856463
1.93779
9 1.99908
8 GROSS PROFIT MARGIN 0.139691 0.142628 0.145877 0.147591 0.14967 0.15177 0.152068 0.152604
0.15021
9 0.15251
9 NET PROFIT MARGIN 0.105828 0.173336 0.109582 0.322488 0.11703 0.119796 0.113074 0.162238
0.10627
2 0.09894
10 PRETAX PROFIT MARGIN 0.125688 0.198648 0.133388 0.34694 0.14384 0.145693 0.134639 0.111773
0.13228
1 0.13951
11 OPERATING PROFIT MARGIN 0.013333 0.209066 0.139103 0.353803 0.14887 0.150903 0.14147 0.118707
0.13928
6 0.1466
3

4.  It is also termed as debtors turnover ratio.
 It shows how many times accounts receivable are
created and collected during the period.
 Receivables turnover =
Total revenue
Average receivables
4

5. 0
0.5
1
1.5
2
2.5
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
receivable turn over ratio
receivable turn over ratio
year ratios:
2007 1.8646
2008 2.0695
2009 1.9405
2010 1.9656
2011 1.4685
2012 1.4628
2013 1.5339
2014 1.3768
2015 1.4369
2016 1.3614
5

6.  In the fig, on 2008 the turnover ratio is the highest.
 There is only a slight fluctuation in turn over ratio
from 2007 to 2016,
 The lowest point in this fig. is about 1.4 on 2016.
6

7.  It provides the information about the ability to
satisfy current liabilities using current assets.
 Current ratio =
Current assets
Current liabilities
7

8. YEAR CURRENT RATIO
2007 0.825601
2008 0.994733
2009 1.104952
2010 1.293476
2011 0.945845
2012 0.908446
2013 0.849322
2014 1.044279
2015 0.883347
2016 0.854066
0
0.2
0.4
0.6
0.8
1
1.2
1.4
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
CURRENT RATIO
CURRENT RATIO
8

9.  Current ratio increases gradually from 2007 to
2010 and reaches to the maximum point at 1.29,
 Then it slightly falls down,
 On 2014 it drastically increases but again starts to
fall and reaches to the minimum point at 0.85 on
2016.
9

10.  It is the relationship between quick assets and the
current liability .
 It helps to test the liquidity more precisely than
current assets.
 Quick ratio =
Cash + Short−term
investments
+ Receivables
Current liabilities
10

11. YEAR QUICK RATIO
2007 0.562849
2008 0.61924
2009 0.48854
2010 0.939633
2011 0.264759
2012 0.58909
2013 0.54404
2014 0.686941
2015 0.541911
2016 0.578591
11

12.  At first two years, it slightly increases and in 3rd
year it Increases drastically and reaches to its
highest point at 0.93,
 Afterward on 2010 it tremendously falls and
reaches to its lowest point at 0.26,
 On 2012, it increases and reaches to 0.6,then it
fluctuates,
 by 2016, quick ratio is 0.57.
12

13.  Cash ratio helps to find out the ability to satisfy
current liabilities using only cash and cash
equivalents to the business concern.
 Cash ratio =
Cash + Short−term
investments
Current liabilities
13

14. years CASH RATIO
2007 0.219176
2008 0.21464
2009 0.14741
2010 0.538857
2011 0.226726
2012 0.243207
2013 0.199237
2014 0.273085
2015 0.174214
2016 0.247781
0
0.1
0.2
0.3
0.4
0.5
0.6
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
CASH RATIO
CASH RATIO
14

15.  On 2007, 2008 and 2009 the ratios remain almost
same but on 2010 the ratio increases drastically
and reaches to the highest level at 0.53 and after
that it falls down,
 From 2011 to 2016 the ratios fluctuates
continuously.
15

16.  It is calculated as total debt divided by total
assets.
 It refers to proportion of assets financed with debt.
 Debt to assets ratio =
Total debt
Total assets
16

17. YEARS DEBT TO ASSETS RATIO
2007 0.185496
2008 0.190331
2009 0.32851
2010 0.292831
2011 0.314582
2012 0.332982
2013 0.313969
2014 0.289569
2015 0.308633
2016 0.317192
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
DEBT TO ASSETS RATIO
DEBT TO ASSETS RATIO
17

18.  On 2007 and 2008 the ratio is almost constant,
 On 2009, the ratio increases to 0.32 after this
year, ratio fluctuates continuously till 2016,
 By 2016 debt to assets ratio is 0.13.
18

19.  It is calculated as long term debt divided by total
assets.
 It refers to the proportion of assets financed with
long-term debt.
 Long term debt to assets ratio =
Long−term debt
Total assets
19

20. YEAR
LONG TERM DEBT
TO ASSETS RATIO
2007 0.062586
2008 0.071628
2009 0.080836
2010 0.067027
2011 0.054404
2012 0.07137
2013 0.086041
2014 0.092889
2015 0.093562
2016 0.084086
0
0.01
0.02
0.03
0.04
0.05
0.06
0.07
0.08
0.09
0.1
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
LONG TERM DEBT TO ASSETS RATIO
LONG TERM DEBT TO ASSETS RATIO
20

21.  From 2007 to 2009 the ratio gradually increases,
afterward it starts falling.
 On 2011, due to tremendous decrease in ratio, it
reaches to the lowest point 0.05,
 While on 2012 it increases in an increasing rate,
afterward increases in a decreasing rate,
 On 2016 again it starts to falling.
21

22.  It is calculated as total assets divided by total
shareholders’ equity.
 It reliance on debt financing.
Financial leverage =
Total assets
Total shareholders′ equity
22

23. YEARS
FINANCIAL LEVERAGE
RATIO
2007 2.10605
2008 1.934136
2009 2.068132
2010 1.78346
2011 1.744991
2012 1
2013 1.877828
2014 1.856463
2015 1.937799
2016 1.999075
0
0.5
1
1.5
2
2.5
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
FINANCIAL LEVERAGE RATIO
FINANCIAL LEVERAGE RATIO
23

24.  From 2007 to 2011, financial leverage ratio
continuously fluctuates,
 On 2012, it decreases drastically and reaches to
its minimum point at 1,
 After a year, it increases tremendously and
reaches to 1.87,
 Again it starts to fluctuate, by 2016 it reaches to
1.99.
24

25.  It is calculated as gross profit divided by total
revenue.
 It measures the overall profitability of the company
in terms of sales.
 Gross profit margin =
Gross profit
Total revenue
25

26. YEARS
GROSS PROFIT
MARGIN
2007 0.139691
2008 0.142628
2009 0.145877
2010 0.147591
2011 0.149672
2012 0.15177
2013 0.152068
2014 0.152604
2015 0.150219
2016 0.152507
0.13
0.135
0.14
0.145
0.15
0.155
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
GROSS PROFIT MARGIN
GROSS PROFIT MARGIN
26

27.  On 2007, the gross profit ratio is 0.139,
 It increases gradually from 2007 to 2014,
 While on 2015, the ratio decreases and reaches to
0.1502,
 by 2016, the ratio increases to 0.1525.
27

28.  It is calculated as net profit divided by total
revenue.
 This ratio measures the overall profitability of a
business by establishing the relation between net
profit and sales.
 Net profit margin =
Net profit
Total revenue
28

29. YEARS
NET PROFIT
MARGIN
2007 0.105828
2008 0.173336
2009 0.109582
2010 0.322488
2011 0.117035
2012 0.119796
2013 0.113074
2014 0.162238
2015 0.106272
2016 0.098935
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
NET PROFIT MARGIN
NET PROFIT MARGIN
29

30.  On 2007, the ratio is 0.105 and on 2008, it
increases to 0.173 while on 2009, it decreases to
0.109,
 On 2010, it drastically increases to 0.322 and
reaches to its maximum point,
 While on 2011, it tremendously decreases and
reaches to the 0.117 and afterward it starts
fluctuating and by 2016 the ratio is 0.09.
30

31.  It is calculated as earning before taxes divided by
total revenue.
 Pretax profit margin =
Earnings before taxes
Total revenue
31

32. YEARS
PRETAX PROFIT
MARGIN
2007 0.125688
2008 0.198648
2009 0.133388
2010 0.34694
2011 0.143846
2012 0.145693
2013 0.134639
2014 0.111773
2015 0.132281
2016 0.13951
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
0.4
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
PRETAX PROFIT MARGIN
PRETAX PROFIT MARGIN
32

33.  On 2007, the ratio is 0.125 and on 2008, it
increases to 0.198 while on 2009, it decreases to
0.133,
 On 2010, it drastically increases to 0.346 and
reaches to its maximum point,
 While on 2011, it tremendously decreases and
reaches to 0.143 and afterward it starts fluctuating
 By 2016 the ratio is 0.139.
33

34.  It is calculated as operating profit divided by total
revenue.
 Operating profit margin =
Operating profit
Total revenue
34

35. YEARS
OPERATING PROFIT
MARGIN
2007 0.013333
2008 0.209066
2009 0.139103
2010 0.353803
2011 0.148872
2012 0.150903
2013 0.14147
2014 0.118707
2015 0.139286
2016 0.146604
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
0.4
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
OPERATING PROFIT MARGIN
OPERATING PROFIT MARGIN
35

36.  On 2007, the ratio is 0.013. Afterward on 2008, it
increases to 0.209 while on 2009 it falls to 0.139,
 On 2010, it drastically increases to 0.35 at its
maximum level,
 On to 2011, it tremendously falls down to 0.15
after that it fluctuates continuously,
 By 2016 the ratio is 0.147.
36

37. 37