This document is a financial report analyzing Nokia's corporate performance through profitability, liquidity, efficiency, and financial risk ratios from 2010-2014. It also includes a brief macroeconomic analysis of Nokia's main geographical markets. The report finds that while Nokia's profitability ratios like gross profit margin and return on capital employed fluctuated during this period and were often below industry averages, its liquidity ratios like current ratio and acid test ratio improved after 2012 and were above industry standards by 2014.
The Bangkok office market saw a decrease in total office space and occupancy rates in 2011. Grade A office space saw the largest declines, with occupancy dropping 9.15% due to political issues and flooding slowing expansion. Grade B and C occupancy rates rose slightly. The average rental rate for Bangkok offices fell to 504 baht/sqm due to some buildings lowering rents to maintain occupancy during economic uncertainty. New supply is expected to increase modestly by 2012-2013 and have little impact on the market. The outlook remains cautious as expansion may still be limited while economic effects of the flooding continue.
Etude PwC IPO Watch 2013-2014 (mars 2014)PwC France
http://pwc.to/1oz8ppo
L’étude IPO Watch de PwC révèle que des opérations se préparent au premier semestre 2014 dans le secteur de la distribution et de la consommation. D’autre part, les privatisations devraient augmenter : certaines banques européennes renflouées pourraient être partiellement privatisées au travers d'introductions en bourse.
Acc30205 basic accounting assignment jan 2015Trace96
This document provides instructions for a group assignment on financial ratio analysis. Students must form groups of up to 3 members, select a publicly traded company, analyze the company's financial ratios over the past 2 years, and make an investment recommendation. The assignment requires submitting a 1500-word written report that includes the company background, ratio calculations and interpretations, and justification for the investment decision. It will be graded based on criteria such as the accuracy of calculations, depth of analysis, and quality of the recommendation.
MelihKomuscu_Intel Corporation Company ProjectMelih Komuscu
The document provides a business valuation report for Intel Corporation. It includes a business summary noting Intel is the world's largest semiconductor chip maker and designs computer components. It discusses Intel's financial performance and risks including competition and demand fluctuations. The valuation approaches Intel's stock using discounted dividend models, residual income valuation, and market multiples. It estimates Intel's stock is slightly undervalued based on the models.
The article discusses achieving a sustainable economy through innovation. A sustainable economy is one where resources are used at a rate that allows nature to replenish them, and benefits are shared equitably. The challenges are curbing consumption in developed nations while raising standards of living in developing nations without increasing overall resource use. This can be achieved through strategies and technologies that break the link between economic growth and environmental damage. The article argues that attaining sustainable development is one of the most important long-term challenges faced as businesses, cities, and regions that lead the sustainability revolution will prosper in the new low-carbon economy.
During 2011-2012, HTC's profitability declined as return on equity decreased by 51.9% and net profit margin fell from 13.6% to 6.2%. HTC's stability also weakened as working capital ratio declined, debt levels increased, and inventory and accounts receivable turnover slowed. While HTC remains a leader in mobile phones, its financial performance has weakened, so investors are recommended to consider alternatives. The price-earnings ratio of 8.09 years also suggests other companies may offer better investment value. In summary, HTC remains investable but its financials suggest it may not be the best choice compared to other options available.
The document provides a financial ratio analysis of Lenovo Company for the years 2012 and 2013. It finds that most profitability ratios improved over this period, such as return on equity and net profit margin, indicating better profitability. However, the general expenses ratio worsened. Most stability ratios also improved, like the working capital ratio, but the debtors turnover ratio increased, meaning it took longer to collect debts. The document recommends not investing in Lenovo shares due to their very high price-earnings ratio of 200, meaning it would take over 200 years for an investor's initial investment to be recouped.
The document provides an analysis of accounting ratios to assess the accounting sector of Galadari Hotels (Lanka) PLC for the financial year 2009/2010. It calculates and compares various profitability, liquidity, activity, and market ratios between 2009 and 2010. The profitability ratios show that the company performed better in 2010 than 2009, with higher gross profit and lower return on asset and equity ratios. Liquidity ratios indicate the company's liquidity position did not change significantly between the two years. Activity ratios show the company took longer to collect receivables and held inventory for a longer period in 2010 compared to 2009.
The Bangkok office market saw a decrease in total office space and occupancy rates in 2011. Grade A office space saw the largest declines, with occupancy dropping 9.15% due to political issues and flooding slowing expansion. Grade B and C occupancy rates rose slightly. The average rental rate for Bangkok offices fell to 504 baht/sqm due to some buildings lowering rents to maintain occupancy during economic uncertainty. New supply is expected to increase modestly by 2012-2013 and have little impact on the market. The outlook remains cautious as expansion may still be limited while economic effects of the flooding continue.
Etude PwC IPO Watch 2013-2014 (mars 2014)PwC France
http://pwc.to/1oz8ppo
L’étude IPO Watch de PwC révèle que des opérations se préparent au premier semestre 2014 dans le secteur de la distribution et de la consommation. D’autre part, les privatisations devraient augmenter : certaines banques européennes renflouées pourraient être partiellement privatisées au travers d'introductions en bourse.
Acc30205 basic accounting assignment jan 2015Trace96
This document provides instructions for a group assignment on financial ratio analysis. Students must form groups of up to 3 members, select a publicly traded company, analyze the company's financial ratios over the past 2 years, and make an investment recommendation. The assignment requires submitting a 1500-word written report that includes the company background, ratio calculations and interpretations, and justification for the investment decision. It will be graded based on criteria such as the accuracy of calculations, depth of analysis, and quality of the recommendation.
MelihKomuscu_Intel Corporation Company ProjectMelih Komuscu
The document provides a business valuation report for Intel Corporation. It includes a business summary noting Intel is the world's largest semiconductor chip maker and designs computer components. It discusses Intel's financial performance and risks including competition and demand fluctuations. The valuation approaches Intel's stock using discounted dividend models, residual income valuation, and market multiples. It estimates Intel's stock is slightly undervalued based on the models.
The article discusses achieving a sustainable economy through innovation. A sustainable economy is one where resources are used at a rate that allows nature to replenish them, and benefits are shared equitably. The challenges are curbing consumption in developed nations while raising standards of living in developing nations without increasing overall resource use. This can be achieved through strategies and technologies that break the link between economic growth and environmental damage. The article argues that attaining sustainable development is one of the most important long-term challenges faced as businesses, cities, and regions that lead the sustainability revolution will prosper in the new low-carbon economy.
During 2011-2012, HTC's profitability declined as return on equity decreased by 51.9% and net profit margin fell from 13.6% to 6.2%. HTC's stability also weakened as working capital ratio declined, debt levels increased, and inventory and accounts receivable turnover slowed. While HTC remains a leader in mobile phones, its financial performance has weakened, so investors are recommended to consider alternatives. The price-earnings ratio of 8.09 years also suggests other companies may offer better investment value. In summary, HTC remains investable but its financials suggest it may not be the best choice compared to other options available.
The document provides a financial ratio analysis of Lenovo Company for the years 2012 and 2013. It finds that most profitability ratios improved over this period, such as return on equity and net profit margin, indicating better profitability. However, the general expenses ratio worsened. Most stability ratios also improved, like the working capital ratio, but the debtors turnover ratio increased, meaning it took longer to collect debts. The document recommends not investing in Lenovo shares due to their very high price-earnings ratio of 200, meaning it would take over 200 years for an investor's initial investment to be recouped.
The document provides an analysis of accounting ratios to assess the accounting sector of Galadari Hotels (Lanka) PLC for the financial year 2009/2010. It calculates and compares various profitability, liquidity, activity, and market ratios between 2009 and 2010. The profitability ratios show that the company performed better in 2010 than 2009, with higher gross profit and lower return on asset and equity ratios. Liquidity ratios indicate the company's liquidity position did not change significantly between the two years. Activity ratios show the company took longer to collect receivables and held inventory for a longer period in 2010 compared to 2009.
Volkswagen Group is one of the largest car manufacturers in the world. The document analyzes Volkswagen's financial ratios from 2012-2013. It finds that profitability ratios like return on equity and net profit margin declined, indicating lower profits. Stability ratios like working capital ratio were also below requirements. As a result, the author recommends against investing in Volkswagen due to its unstable financial status and low profitability ratios over the period analyzed.
Global Powers of Consumer Products 2013Melih ÖZCANLI
Global Powers of Consumer Products 2013
Engaging the connected customer
by Deloitte, 2013
The opportunity for consumer products companies to manage their brands online, engage with consumers at an individual level, and drive sales through digital channels is significant. The question is how to do it well. Take a look at this year's report to see which consumer goods companies are on the Top 250 list. Then keep reading to see what approaches the industry is likely to take to engage this new, digitally empowered consumer.
Find out which companies are where on this year's Top 250 list by downloading the complete report.
Corporate Financial Management Assignment - Ratio Analysis of Hays plcAmany Hamza
This document analyzes the financial performance of Hays plc from 2011-2012 using various ratio analyses including profitability, liquidity, gearing, leverage, and efficiency ratios. Some key findings are that ROCE and profit margin increased slightly from 2011-2012 indicating better capital investment returns and operating efficiency. The current ratio remained relatively stable. Gearing and leverage ratios improved, showing lower debt levels and stronger interest coverage. The document also evaluates Hays share price using net asset value, dividend valuation, and P/E ratio models to determine if the stock is over or undervalued.
STUDY AND ANALYSIS OF WORKING CAPITAL MANAGEMENT sumit12dn
This research paper analyzes the working capital management of Trend Electronics Limited over four years from 2011-2014 using ratio analysis. The key findings are:
1) The company's net working capital, current ratio, and profitability declined over this period while its operating cycle remained steady around 8 months.
2) Specific issues identified include high inventory levels, increased debt, and declining gross profit margins.
3) Recommendations include improving liquidity ratios, reducing the operating cycle, increasing creditors payment periods, and taking actions to boost gross profit margins above 6%.
The document discusses recent market trends and the relationship between two opposing forces - the "Bubble Chain" and the "Deleveraging Chain".
The Bubble Chain refers to rising asset prices driven by central bank liquidity, moving from government bonds to corporate credit to equities. However, a Deleveraging Chain is also occurring, shown through weakness in commodities, emerging markets, and gold. These two chains send inconsistent signals about the economy.
The document argues one chain will have to give way at some point, allowing for a realignment. It also analyzes gold's recent sharp decline, putting forward several hypotheses for what triggered it and what implications it could have. The author remains uncertain about which
This document contains financial analysis of Amway Malaysia for the years 2012 and 2013. It includes the income statement, balance sheet, and calculation of various profitability and stability ratios. The profitability ratios like net profit margin, gross profit margin, and expense ratios improved from 2012 to 2013, indicating better management of costs. The stability ratios like working capital, debt, and inventory turnover also improved over this period. However, the P/E ratio of 18 times suggests the shares are overvalued currently. Overall, the financial health and performance of Amway Malaysia seems good based on the ratio analysis, but the shares may not be a good investment at the current price.
Italian banks face challenges including low profitability and deteriorating asset quality as non-performing loans have increased significantly. The size of the Italian non-performing loan market reached €122 billion in November 2012, with increased loss provisions by banks in late 2012. Recent activity in the market has included successful auctions of mixed loan portfolios and sales of consumer credit portfolios, while new investors have also entered the market. The outlook for 2013 will depend on further loan loss provisions, political stability, and the recovery of the real estate lending market.
You are welcome to review our Q4 2012 Lagos Real Estate Investment Report. MCORE is a project finance company focused on providing financing, investment, management and trading services to the real estate, construction, infrastructure, energy and commodity sectors.
India's balance of payments was under stress in 2011-12 as the trade and current account deficits widened. Exports grew at a slower rate while imports grew significantly, leading to a large trade deficit. The current account deficit also increased substantially. While capital inflows increased, they did not fully finance the current account deficit, resulting in a drawdown of foreign exchange reserves. The growing integration of India's economy with the global economy has helped growth but also increased vulnerability to external shocks. Focusing on domestic macroeconomic rebalancing can help reduce this vulnerability.
This document provides a summary of the global economic outlook and trends for retailers to consider. It discusses slowing economic growth in many leading markets in 2012. In Europe, government spending cuts and debt issues are weakening economies and confidence. In the US, uncertainty around fiscal policy is hurting markets. China is also slowing after monetary tightening. Some positives for retailers include potential margin improvements from lower commodity prices and inflation in some countries. Long term global growth prospects remain strong, especially in emerging markets.
Financial ratio analysis for honda motor companyHITESH BHARTI
Honda Motor Company's financial ratios are analyzed over a five year period from 2007-2011. The document analyzes Honda's liquidity, profitability, turnover efficiency, leverage, and cash flow ratios and compares them to industry averages. Key findings are that Honda's current ratio, liquid ratio, and debt ratios are lower than industry averages, indicating less risk, while profitability ratios like net margin and return on equity are consistently higher. Turnover ratios declined over time, suggesting room for improvement in inventory management and asset utilization.
Deal market digest issue 88_22march 2013CAR FOR YOU
The Dealmarket Digest provides concise summaries of private equity news and trends. This week's issue highlights that global private equity deal value more than tripled in February due to two large transactions. It also reports that private equity deals in Israel declined 10% in 2012 due to fewer high tech deals. Additionally, the issue summarizes surveys finding that family offices remain positive on private equity and that European venture philanthropy organizations are increasingly focusing on social enterprises.
Microsoft is a leading technology company founded in 1975. It has expanded from operating systems into hardware, gaming, and software. A ratio analysis of Microsoft from 2012-2013 found that the company's profitability increased as return on equity and net profit margin rose. However, gross profit margin declined. The company also improved at controlling selling and financial expenses. While financially stable with adequate working capital, the company's inventory and debt collection turnover slowed. With a price-earnings ratio of 15, investment is recommended for long-term investors willing to wait 15 years for returns.
Monetary policy review rbi july 2013 0 md317c83c123arjunarikeri
The document discusses recent macroeconomic developments in India during the first quarter of 2012-13. Some key points:
1) Economic growth in India slowed to a 29-quarter low of 5.3% in Q4 of 2011-12 and has likely remained weak in Q1 of 2012-13, with risks to growth increasing from the global slowdown, domestic supply constraints, and a poor monsoon.
2) Inflation has remained persistent, with both wholesale and retail inflation remaining above target levels, posing a challenge for monetary policy.
3) The current account deficit remains large and financing it is difficult given slowing capital inflows, though lower oil prices may provide some relief. External debt is rising
This document analyzes trends in shared services and outsourcing (SSO) across seven industries. It finds that the SSO market has grown substantially since the 2000 technology bust as companies seek cost savings. India remains the top location due to low costs and skills, but faces competition from countries like China. The report surveys large companies to understand current and future SSO patterns, including key drivers and locations. Top locations vary by industry, with India the overall leader but other Asian countries growing. The report provides an in-depth look at SSO trends, strategies and locations by industry.
The overview of financial performance of transcom electronic company ltdxeon_adi
The document provides an overview of the financial performance of Transcom Electronic Company Ltd from 2011-2015. It analyzes the company's liquidity, profitability, and leverage ratios over this period based on financial statements. Key findings include the company's current and quick ratios improving in 2015, gross and net profit margins increasing but being negative in some years, and return on investment fluctuating between years and being zero or negative at times. The conclusion states Transcom aims to be a market leader in Bangladesh and demonstrates that locally owned companies can provide modern, professional services.
The unemployment rate in Latvia declined slightly in Q4 2011 but the number of discouraged workers also decreased. While employment continued to grow in 2011, job creation is expected to slow this year. Unemployment remained high at 11.8% in January-February 2012, with over half of the unemployed being long-term unemployed. For economic growth to significantly reduce inequality, emigration and regional imbalance, tax, education and social policies need reforms beyond just focusing on growth alone.
This Project deals with the comparative study of 2 companies listed in S&P 500 for their performance evaluation & ratio analysis for the 3 financial years.
The document provides background information on Lenovo Company, including its history, products, acquisitions and growth. It then analyzes Lenovo's financial ratios from 2012-2013, finding that most profitability and stability ratios improved, indicating better control of expenses. However, the share price is not suitable for investment given its extremely high price-to-earnings ratio of 200 years, meaning an investor would have to wait over 200 years to recover their investment. In conclusion, while Lenovo's financial performance has strengthened, its shares are too expensive for conservative investors.
This document analyzes the financial ratios of BNL Stores from 2002-2010 using income statements, balance sheets, and cash flow statements. It finds that BNL's profitability ratios like net profit margin and return on equity declined significantly from 2004-2010. This was likely due to high growth in operating expenses outpacing sales growth. Accounts receivable also increased substantially from 2004-2005, indicating issues with collecting on credit sales. The analysis suggests BNL's strategy of offering store credit and incentivizing sales on credit harmed its financial performance in the long run.
Dell's financial analysis shows improving liquidity from 2011 to 2012 based on ratio calculations. The current ratio increased from 1.05 to 1.09, indicating greater ability to pay short-term debts. However, the quick ratio of 0.92 to 0.97 suggests Dell still relies on inventory to meet obligations. Asset turnover declined slightly from 0.58 to 0.55, meaning assets were not fully utilized to generate sales. Overall, the analysis found signs of better liquidity management but also opportunities for Dell to optimize its asset usage.
Volkswagen Group is one of the largest car manufacturers in the world. The document analyzes Volkswagen's financial ratios from 2012-2013. It finds that profitability ratios like return on equity and net profit margin declined, indicating lower profits. Stability ratios like working capital ratio were also below requirements. As a result, the author recommends against investing in Volkswagen due to its unstable financial status and low profitability ratios over the period analyzed.
Global Powers of Consumer Products 2013Melih ÖZCANLI
Global Powers of Consumer Products 2013
Engaging the connected customer
by Deloitte, 2013
The opportunity for consumer products companies to manage their brands online, engage with consumers at an individual level, and drive sales through digital channels is significant. The question is how to do it well. Take a look at this year's report to see which consumer goods companies are on the Top 250 list. Then keep reading to see what approaches the industry is likely to take to engage this new, digitally empowered consumer.
Find out which companies are where on this year's Top 250 list by downloading the complete report.
Corporate Financial Management Assignment - Ratio Analysis of Hays plcAmany Hamza
This document analyzes the financial performance of Hays plc from 2011-2012 using various ratio analyses including profitability, liquidity, gearing, leverage, and efficiency ratios. Some key findings are that ROCE and profit margin increased slightly from 2011-2012 indicating better capital investment returns and operating efficiency. The current ratio remained relatively stable. Gearing and leverage ratios improved, showing lower debt levels and stronger interest coverage. The document also evaluates Hays share price using net asset value, dividend valuation, and P/E ratio models to determine if the stock is over or undervalued.
STUDY AND ANALYSIS OF WORKING CAPITAL MANAGEMENT sumit12dn
This research paper analyzes the working capital management of Trend Electronics Limited over four years from 2011-2014 using ratio analysis. The key findings are:
1) The company's net working capital, current ratio, and profitability declined over this period while its operating cycle remained steady around 8 months.
2) Specific issues identified include high inventory levels, increased debt, and declining gross profit margins.
3) Recommendations include improving liquidity ratios, reducing the operating cycle, increasing creditors payment periods, and taking actions to boost gross profit margins above 6%.
The document discusses recent market trends and the relationship between two opposing forces - the "Bubble Chain" and the "Deleveraging Chain".
The Bubble Chain refers to rising asset prices driven by central bank liquidity, moving from government bonds to corporate credit to equities. However, a Deleveraging Chain is also occurring, shown through weakness in commodities, emerging markets, and gold. These two chains send inconsistent signals about the economy.
The document argues one chain will have to give way at some point, allowing for a realignment. It also analyzes gold's recent sharp decline, putting forward several hypotheses for what triggered it and what implications it could have. The author remains uncertain about which
This document contains financial analysis of Amway Malaysia for the years 2012 and 2013. It includes the income statement, balance sheet, and calculation of various profitability and stability ratios. The profitability ratios like net profit margin, gross profit margin, and expense ratios improved from 2012 to 2013, indicating better management of costs. The stability ratios like working capital, debt, and inventory turnover also improved over this period. However, the P/E ratio of 18 times suggests the shares are overvalued currently. Overall, the financial health and performance of Amway Malaysia seems good based on the ratio analysis, but the shares may not be a good investment at the current price.
Italian banks face challenges including low profitability and deteriorating asset quality as non-performing loans have increased significantly. The size of the Italian non-performing loan market reached €122 billion in November 2012, with increased loss provisions by banks in late 2012. Recent activity in the market has included successful auctions of mixed loan portfolios and sales of consumer credit portfolios, while new investors have also entered the market. The outlook for 2013 will depend on further loan loss provisions, political stability, and the recovery of the real estate lending market.
You are welcome to review our Q4 2012 Lagos Real Estate Investment Report. MCORE is a project finance company focused on providing financing, investment, management and trading services to the real estate, construction, infrastructure, energy and commodity sectors.
India's balance of payments was under stress in 2011-12 as the trade and current account deficits widened. Exports grew at a slower rate while imports grew significantly, leading to a large trade deficit. The current account deficit also increased substantially. While capital inflows increased, they did not fully finance the current account deficit, resulting in a drawdown of foreign exchange reserves. The growing integration of India's economy with the global economy has helped growth but also increased vulnerability to external shocks. Focusing on domestic macroeconomic rebalancing can help reduce this vulnerability.
This document provides a summary of the global economic outlook and trends for retailers to consider. It discusses slowing economic growth in many leading markets in 2012. In Europe, government spending cuts and debt issues are weakening economies and confidence. In the US, uncertainty around fiscal policy is hurting markets. China is also slowing after monetary tightening. Some positives for retailers include potential margin improvements from lower commodity prices and inflation in some countries. Long term global growth prospects remain strong, especially in emerging markets.
Financial ratio analysis for honda motor companyHITESH BHARTI
Honda Motor Company's financial ratios are analyzed over a five year period from 2007-2011. The document analyzes Honda's liquidity, profitability, turnover efficiency, leverage, and cash flow ratios and compares them to industry averages. Key findings are that Honda's current ratio, liquid ratio, and debt ratios are lower than industry averages, indicating less risk, while profitability ratios like net margin and return on equity are consistently higher. Turnover ratios declined over time, suggesting room for improvement in inventory management and asset utilization.
Deal market digest issue 88_22march 2013CAR FOR YOU
The Dealmarket Digest provides concise summaries of private equity news and trends. This week's issue highlights that global private equity deal value more than tripled in February due to two large transactions. It also reports that private equity deals in Israel declined 10% in 2012 due to fewer high tech deals. Additionally, the issue summarizes surveys finding that family offices remain positive on private equity and that European venture philanthropy organizations are increasingly focusing on social enterprises.
Microsoft is a leading technology company founded in 1975. It has expanded from operating systems into hardware, gaming, and software. A ratio analysis of Microsoft from 2012-2013 found that the company's profitability increased as return on equity and net profit margin rose. However, gross profit margin declined. The company also improved at controlling selling and financial expenses. While financially stable with adequate working capital, the company's inventory and debt collection turnover slowed. With a price-earnings ratio of 15, investment is recommended for long-term investors willing to wait 15 years for returns.
Monetary policy review rbi july 2013 0 md317c83c123arjunarikeri
The document discusses recent macroeconomic developments in India during the first quarter of 2012-13. Some key points:
1) Economic growth in India slowed to a 29-quarter low of 5.3% in Q4 of 2011-12 and has likely remained weak in Q1 of 2012-13, with risks to growth increasing from the global slowdown, domestic supply constraints, and a poor monsoon.
2) Inflation has remained persistent, with both wholesale and retail inflation remaining above target levels, posing a challenge for monetary policy.
3) The current account deficit remains large and financing it is difficult given slowing capital inflows, though lower oil prices may provide some relief. External debt is rising
This document analyzes trends in shared services and outsourcing (SSO) across seven industries. It finds that the SSO market has grown substantially since the 2000 technology bust as companies seek cost savings. India remains the top location due to low costs and skills, but faces competition from countries like China. The report surveys large companies to understand current and future SSO patterns, including key drivers and locations. Top locations vary by industry, with India the overall leader but other Asian countries growing. The report provides an in-depth look at SSO trends, strategies and locations by industry.
The overview of financial performance of transcom electronic company ltdxeon_adi
The document provides an overview of the financial performance of Transcom Electronic Company Ltd from 2011-2015. It analyzes the company's liquidity, profitability, and leverage ratios over this period based on financial statements. Key findings include the company's current and quick ratios improving in 2015, gross and net profit margins increasing but being negative in some years, and return on investment fluctuating between years and being zero or negative at times. The conclusion states Transcom aims to be a market leader in Bangladesh and demonstrates that locally owned companies can provide modern, professional services.
The unemployment rate in Latvia declined slightly in Q4 2011 but the number of discouraged workers also decreased. While employment continued to grow in 2011, job creation is expected to slow this year. Unemployment remained high at 11.8% in January-February 2012, with over half of the unemployed being long-term unemployed. For economic growth to significantly reduce inequality, emigration and regional imbalance, tax, education and social policies need reforms beyond just focusing on growth alone.
This Project deals with the comparative study of 2 companies listed in S&P 500 for their performance evaluation & ratio analysis for the 3 financial years.
The document provides background information on Lenovo Company, including its history, products, acquisitions and growth. It then analyzes Lenovo's financial ratios from 2012-2013, finding that most profitability and stability ratios improved, indicating better control of expenses. However, the share price is not suitable for investment given its extremely high price-to-earnings ratio of 200 years, meaning an investor would have to wait over 200 years to recover their investment. In conclusion, while Lenovo's financial performance has strengthened, its shares are too expensive for conservative investors.
This document analyzes the financial ratios of BNL Stores from 2002-2010 using income statements, balance sheets, and cash flow statements. It finds that BNL's profitability ratios like net profit margin and return on equity declined significantly from 2004-2010. This was likely due to high growth in operating expenses outpacing sales growth. Accounts receivable also increased substantially from 2004-2005, indicating issues with collecting on credit sales. The analysis suggests BNL's strategy of offering store credit and incentivizing sales on credit harmed its financial performance in the long run.
Dell's financial analysis shows improving liquidity from 2011 to 2012 based on ratio calculations. The current ratio increased from 1.05 to 1.09, indicating greater ability to pay short-term debts. However, the quick ratio of 0.92 to 0.97 suggests Dell still relies on inventory to meet obligations. Asset turnover declined slightly from 0.58 to 0.55, meaning assets were not fully utilized to generate sales. Overall, the analysis found signs of better liquidity management but also opportunities for Dell to optimize its asset usage.
The document provides financial ratio analyses for Lenovo Company for the years 2012 and 2013. It analyzes profitability ratios such as return on equity, net profit margin, and gross profit margin, which mostly increased from 2012 to 2013, indicating improved profitability. It also examines stability ratios like working capital ratio, debt ratios, and inventory turnover, which were stable or improved. However, the price-earnings ratio was extremely high at 200 years, making the stock unsuitable for investment according to the analysis.
This report analyzes the financial stability, profitability, and liquidity of Leggett & Platt Inc. based on their 10K filing. Ratios show transparency in items like acquisitions and impairments. While net income declined in 2013 due to an impairment charge, cash flows remained strong. Overall, the company has sustainable earnings, a conservative financial profile, and has increased its dividend for 42 consecutive years, positioning it for continued strong performance.
Download here - http://www.parker.com/parkerimages/Parker.com/About%20Us/Literature/FY13%20Annual%20Report%20Final.pdf
On the cover, Michael Gore, a T10 complete paraplegic, stands tall in the Parker Indego® which gives him the independence to do something he was told by the medical community that he would never do again – walk. Parker is pursuing a new growth platform in human motion and control as a natural extension of our vision to be the global leader in motion and control technologies. Indego® presents a compelling first step in a broader opportunity to create a meaningful and positive impact on the lives of individuals with limited mobility.
This year’s annual report focuses on innovations that have helped our customers solve problems. The difference made in the lives of our customers is representative of the broader change we hope to effect in the world around us.
It is our dedication to solving some of the world’s greatest engineering challenges, and our commitment to partner with our customers in search of unique and promising advancements, that drives Parker people forward and secures our future growth.
The document summarizes a PwC report on working capital performance in the manufacturing sector from 2009-2013. It finds that while revenue growth has stalled, companies have improved working capital performance by focusing on inventory management. However, €100 billion remains trapped in working capital across the industry. The report also notes that performance varies widely, and that improving working capital could release €100-162 billion in additional cash for the industry.
Cargills (Ceylon) PLC & Nestle Lanka PLC financial position and the performa...Dulakshi Ranadeera
Chapter 1
1.1. Earnings per Share
1.2. Dividend per Share…
1.3. Market Value…
1.4. Cash Flow
1.5. Profitability Ratios
1.6. Net Asset per Share
1.7. Solvency Ratios
1.8. Liquidity Position
2. Chapter 2
2.1. Nestle Lanka
2.1.1. The level of the corporate governance and legal procedure of the company
2.1.2. Compliance for legal procedure
2.1.3. Employee relations and relationship with shareholders
2.1.4. Social Responsibilities of the organization
2.1.5. Share information
2.1.6. Market share Percentage
2.2. Cargills (Ceylon) PLC
2.2.1. The level of the corporate governance and legal procedure of the company
2.2.2. Compliance for legal procedure
2.2.3. Employee relations and relationship with shareholders
2.2.4. Social Responsibilities of the organization
2.2.5. Share information
2.2.6. Market share Percentage
Chapter 3
Ericsson is a leading provider of communications technology and services. It analyzed key financial ratios from its income statement, balance sheet, and cash flow statement from 2012-2010. Profit margins, returns, and earnings per share declined from 2011 to 2012 due to lower profits. Liquidity was stable but inventory turnover improved. Debt levels were unchanged while interest coverage declined on lower profits. Valuation ratios indicated the share price was high relative to earnings. The cash flow statement showed interest and tax payments and cash and investment balances.
The document analyzes J2 Global Communications (JCOM) and finds its stock undervalued. Key reasons for undervaluation are embedded expectations that JCOM's core eFax business is declining, lack of belief in management's ability, and skepticism around cash usage. However, the analysis identifies catalysts that could drive the stock price up, including continued ROI growth exceeding expectations, strategic fit of recent acquisitions, and understanding that eFax remains innovative in new markets.
SPIMACO is a large Saudi pharmaceutical company with over $1.2 billion in capital. A SWOT analysis identified strengths like revenue growth and new product introductions, but also weaknesses such as declining earnings per share, gross profit margins, and net profit margins. Opportunities exist in mergers and acquisitions, utilizing local Saudi workers, and data analytics to improve customer insights. Threats include investor resistance due to low EPS, ensuring local workers are adequately trained, and competitive product pricing. Recommendations include focusing on top customers, reducing costs, innovating products, strengthening customer relationships, and using digital transformation to improve efficiency.
Effect of operating, financial and total leverage on expected stock return an...Shoaib Lalani
Regardless of the size and nature, largely all businesses are dependent on leverage. This research called for analyzing the impact of leverage on equity elements like the earnings to price ratio, Market value of equity and book to market ratio. Later on we also tested to identify the relationship between leverage and on expected stock returns. Financial data for different companies ranging in their own sectors was collected and then financial data from 2002 to 2012 was used to run pooled regression in order to find out any existing relationship
The results were pretty astonishing as it was proved that leverage had no impact on either of the equity elements. Nevertheless, a relationship could be identified between leverage and expected stock returns. Hence it will be safe to conclude that Pakistan’s economy is shortsighted and consumption oriented and that profits and earnings of companies in Pakistan are highly financed by their respective revenues. But nevertheless judgments about a particular sector couldn’t be made as this report has various business sectors of Pakistan.
Contents1.0Background11.1 Industry Overview11.2 Financi.docxmaxinesmith73660
Contents
1.0 Background 1
1.1 Industry Overview 1
1.2 Financial Background 1
2.0 Analysis of Accounting Quality 2
2.1 Vodafone PLC 2
2.2 Zain 3
3.0Trend Analysis 3
3.1 Financial Position 3
3.2 Revenue 4
4.0 Profitability Analysis 5
4.1 Return on Capital Employed 5
4.2 Profitability at Operational level 5
4.3 Financial Leverage 6
4.4 Operating Spread 6
4.5 Second Level of Decomposition 7
4.5.1 Profit Margin 7
4.5.2 Asset Turnover 7
5.0 Industry Analysis 7
5.1 Vodafone 7
5.2 Zain 9
6.0 Conclusion 10
7.0 References 11
8.0 Appendix 12
Return on Capital Employed - Inter-firm comparison 13
First Level Inter-firm Analysis 13
Financial Leverage 14
Net Borrowing Cost 14
Operating Spread 14
Second Level Inter Firm Analysis 15
Asset turnover 16
Drivers of Profitability – Vodafone – European Market 17
Drivers of Profitability – Zain Telecom – GCC Market 19
List of Tables
Table 1:1 Trend Analysis - Vodafone – Abstract4
Table 1:2: Trend Analysis - Zain Telecom - Abstract4
Table 1:3: Income Trend Analysis - Vodafone - Abstract 4
Table 1:4 Income Trend Analysis - Zain – Abstract5
Table 1: 5 Return on Capital Employed - Vodafone vs. Zain5
Table 1:6 Return on Net Operating Assets - Vodafone vs. Zain6
Table 1:7 Financial Leverage: Vodafone vs. Zain6
Table 1: 8 Operating Spread - Vodafone vs. Zain 6
Table 1:9 Profit Margin - Vodafone vs. Zain7
Table 1: 10 Asset Turnover - Vodafone vs. Zain 7
Table1: 11 Industry Average - Vodafone vs. Europe8
Table 1:12 Industry Analysis - Zain vs. Gulf9
ii
1.0 Background
It is impossible to imagine modern society without mobile telecommunications given that three billion calls are made each day in the US alone (Romano, 2013), there are more than 6.8 billion mobile telecommunications subscribers worldwide, and today, 96.2 out of every 100 people are expected to have a mobile device (Mobi-thinking, 2013). If these figures are not astonishing enough, the number of mobile subscribers is likely to surpass the world’s population in 2014 (Pramis, 2013). A total of 1.9 billion cell phones were sold in 2012, and the number does not seem as though it will fall anytime soon; in fact, the number is likely to grow to 2.6 billion by 2016 (Mobi-thinking, 2013). In 2011 in the UK, the number of mobile calls surpassed landline calls (Lee, 2013). Vodafone Group is the second largest service provider in the world, with a 2013 revenue of more than £44 billion (Mobi-thinking, 2013). However, assessing the financial state of a telecommunications company involves more than just assessing its revenue. This high technology oriented industry has continuous technical development, requiring shorter spans of return on investment and complex depreciation adjustments.
1.1 Industry Overview
The telecommunications industry is in itself diversified to various product offerings. Usually, cellular telecommunications (mobile and satellite) and fixed line telecommunications (landline and internet) are the two identified categories. China Mobi.
IntroductionThe company that has been researched is the Toyota .docxmariuse18nolet
Introduction:
The company that has been researched is the Toyota motor Corporation
Ticker symbol
TM
Exchange
New York Stock Exchange (NYSE)
No of common shares outstanding
1,583,714,334
Industry
Consumer goods
Country
Japan
Toyota Motor Corporation is considered to be a leading automaker headquartered in Japan. The human resources vertical employed 317,734 people and was the largest automobile manufacturer by production. Founded in 1937, the automaker has grown and has its presence in all countries of the world .the Toyota motor corporation group is considered to be one of the largest conglomerates in the world
A. Provide a rationale for the U.S. publicly traded company that you selected, indicating the significant factors driving your decision as a financial manager
Some financial highlights of the company which favorably incline towards investing in this company:
1. The third quarter result of the financial results of the firm showed that on a consolidated basis,
a. net revenues for the period totaled 19.12 trillion yen, an increase of 17.8 percent compared to the same period last fiscal year.
b. Operating income increased from 818.5 billion yen to 1.85 trillion yen,
c. Income before income taxes was 2.02 trillion yen.
d. Net income increased from 648.1 billion yen to 1.52 trillion yen
e. Operating income increased by 1.03 trillion yen.
Some of the major contributors to the increase in income were cost reduction efforts and favorable currency fluctuations. The global sales of automobiles under the group registered a 25% increase globally.
As the financial manger of a company, my instincts towards advising a client to invest in a company are grounded by strong fundamentals. Toyota Motor Corporation has been very strong in its financial fundamentals. Companies whose financial fundamentals are very strong make good investments portfolios.
Such firms are called blue chip companies and trades very selectively on the stock markets are can be studied in depth for any investment purposes. Such firms rarely indulge themselves in any kind of compliance issues are generally favored by investors.
Toyota Motor Corporation is one such stock that as a finance manager I would recommend to buy and hold because the firm has been in the news for all the right reasons and for its future plans of expansion with very strategic mergers and acquisitions. The firm’s product ranges especially the new line of green automotive ranges have caught the fancy of al countries and it is expected that the company will be giving a return of more than 22% to its shareholders (toyotaglobal.com).
B. Determine the profile of the investor for which this company may be a fit, relative to that potential investor's investment strategy. Provide support for your rationale.
The profile of a suitable investor for the company would be a conservative risk taker. The investor would like to buy the stock and hold it for long periods so as to partake of the .
Avant Garde wealth Mgmt - Quarterly letter - 1303Gaurav Jalan
- The document provides an analysis of investment trends, corporate profits, consumption patterns, and their impact on stock market valuations. It finds that declining new project announcements suggest a decline in capital expenditures and corporate profit growth over the next few years.
- It also discusses trends in the gold market, finding that recent price declines do not necessarily indicate the end of the secular bull market. Investor behavior and ongoing monetary easing by global central banks support ongoing gold demand and price appreciation over the long term.
- The portfolio has not changed much but individual stock positions are reexamined given recent sharp price moves. Returns have been subdued in the difficult market environment.
Valuation Analysis and Structured Management Buy-Out of SolarTech Inc.Neda Petkova
The document provides an analysis for a potential management buyout of SolarTech Inc. It includes:
- An analysis of SolarTech's financial performance over recent years which shows increasing sales and profits.
- A comparison of SolarTech's key financial ratios to industry averages, finding them similar or marginally better.
- An evaluation of two scenarios for the management buyout with different debt-to-equity mixes and their impact on returns.
- A recommendation to proceed with the buyout using a debt-to-equity mix of 60% debt and 40% equity as it best meets the desired return and financial covenant parameters.
This document provides a financial analysis of Imperial Tobacco Group PLC for 2014. It includes accounting ratios to analyze the company's performance, liquidity, gearing, investors' returns, and efficiency. Key ratios show the company's return on capital employed increased in 2013. Its current ratio, liquidity, and ability to cover interest expenses decreased slightly but were still considered adequate. The document also evaluates the company's share price, net asset value, dividend yield, historic and prospective price-earnings ratios. Based on the analysis, while the shares appear undervalued, they are recommended for long-term investors given the time needed to generate profits from the investment.
This document provides financial information about Square Pharmaceuticals Limited, including:
1. Key financial ratios from 2009-2010 to 2011-2012 showing the company has satisfactory current, quick, and debt ratios compared to industry averages.
2. Calculations for enterprise value, equity value, and value per share of Tk 232.51 based on historical income statements, balance sheets, and share prices from 2006-2012.
3. Assumptions made in forecasting the company's financial statements from 2012-2013 to 2014-2015 and calculating weighted average cost of capital.
The document analyzes the financial performance of Dangote Flour Mills PLC for 2012-2013 by comparing their financial ratios to Nestle Nigeria PLC. The summary shows that Dangote Flour Mills is struggling financially, with poor liquidity, profitability, activity and high leverage ratios, indicating inefficiencies and an overreliance on debt. In comparison, Nestle Nigeria PLC has stronger financial ratios and performance. Immediate action is needed to improve Dangote Flour Mills' operations and financial position.
Similar to Finished_Individual_Finance_Report (20)
1. Ind i v i d u a l F i na nc e R e p o r t
Prepared by: John Hunt
Student number: 12810977
Word Count: 2187
2. 12810977 John Hunt 16/05/2014
2
Table of Contents
INTRODUCTION.................................................................................................................................................3
PROFITABILITY RATIOS...............................................................................................................................4
GROSS PROFIT MARGIN......................................................................................................................................4
NET PROFIT MARGIN ........................................................................................................................................4
RETURN ON CAPITAL EMPLOYED.....................................................................................................................5
LIQUIDITY RATIOS..........................................................................................................................................5
CURRENT RATIO .................................................................................................................................................5
ACID TEST (ALSO KNOWN AS QUICK RATIO)................................................................................................5
OPERATING CASH FLOW TO CURRENT LIABILITIES ......................................................................................6
EFFICIENCY RATIOS........................................................................................................................................6
TOTAL ASSET TURNOVER (TAT)...................................................................................................................6
ACCOUNTS RECEIVABLE TURNOVER (ART).................................................................................................7
PAYABLES TURNOVER (DAYS).........................................................................................................................7
FINANCIAL RISKRATIOS..............................................................................................................................7
CAPITAL GEARING RATIO .................................................................................................................................7
DEBT EQUITY RATIO .........................................................................................................................................8
RETURN TO INVESTORS RATIOS.............................................................................................................8
EARNINGS PER SHARE.......................................................................................................................................8
DIVIDENDS PER SHARE......................................................................................................................................8
DIVIDEND COVER RATIO....................................................................................................................................9
MACROECONOMIC COUNTRY ANALYSIS.............................................................................................9
CONCLUSION.......................................................................................................................................................9
APPENDIX- RATIOS AND CALCULATIONS.......................................................................................11
REFERENCES.....................................................................................................................................................16
3. 12810977 John Hunt 16/05/2014
3
Introduction
In this report I will assess Nokia’s corporate performance through the use of financial
analysis in accompany withmacroeconomic country analysis. Nokia Oyjcommonly
knownas just Nokia is a Finnish multinational communications and information
technology company headquartered in Espoo, Uusimaa, in the greater Helsinki
metropolitan area. Nokia’s shares are listed on the Helsinki and New Yorkstock
exchange, and its market cap is £22.5b (17th May 2014). For the year ending 31
December 2014 Nokia’s net sales was €12.7bn with a net loss of €237million.
Nokia’s main geographical markets in 2014 are Europe (30.5%) Middle East and Africa
(8.6%) Greater China (11.1%)Asia-Pacific (26.4%) North America (15.1%) Latin
America (8.3%).
0
10
20
30
40
50
2010 2011 2012 2013 2014
Net Sales (EURbn)
Net Sales (EURbn)
Figure 1: Nokia’s net sales 2014 by region. Source:
company.nokia.com
4. 12810977 John Hunt 16/05/2014
4
Profitability ratios
Profitability is such a key aspect when looking at the financial status of any company.
These ratios are often used in conjunctionwith competitor’s results as a comparison
tool. Ratios of this nature give a clear outline of change when compared to previous
years, this data can be of great significance to anyone looking to invest in a company.
Gross profit margin
Gross profitmargin is calculated by dividing gross profit by revenue and expressed as a
percentage. Gross profit margin outlines the amount of profit received after accounting
for the cost of sales. Companies strive to maximise this figure, as it’s a key indicator
towards a company’s success, howeversome industries tend to have a naturally higher
GPMthan others. As shown in the table below Nokia’s GPMtook a rather drastic dive
between the years of 2010 and 2012 falling from 30.2% in 2010 to 29.3%in 2011 then
further more to 27.8% in 2012 this is due to fall in gross profitand can be more
specifically allocated to the fall in gross profitreceived from devices and services.
Nokia’s GPM then jumped to 42.1% this is due to the fallin cost of sales compared to the
year before and the increase in gross profit margin as a YOY change percentage. Nokia’s
GPMcontinued to grow from 2013-2014 where it reached 44.3% this was achievedby
an increase in gross profit of 6% compared to the year 2013 and a decrease in costof
sales by 4%, the fallin cost of sales could be due to new technologies being released in
turn improving efficiency and lowering the cost of sales. Nokia’s gross profit margin
fluctuates around the industry average.
2010 2011 2012 2013 2014 Industry
average
GPM (%) 30.2 29.3 27.8 42.1 44.3 37.9
Net Profit Margin
Net ProfitMargin (NPM)is the net income divided by the revenue. NPMmeasures the
percentage of profit each unit of revenue the company is left with as wellas capital
growth and what ever is left overto be paid out to shareholders via dividends whichis
what most investors willbe interested in. As you can see from the table below Nokia
have been struggling to keep their NPM positive in recent years. Nokia’s NPMhas been
so low as of recent due to the huge amounts of money they reinvest into research and
development, overthe past 5 years Nokia has invested 19668 EURm often causing then
to make a net loss. Between the years of 2010 and 2012 Nokia’s NPM had dropped from
a positive 4.2% to negative 8.8%. once reaching their trough in 2012 Nokias NPM then
reached a positive 1.9% in 2013 before decreasing again in 2014. Nokia’s net profits
have been drastically affectedby increased competition and "strategic entry deals,
particularlyinChina"yetstillstayaroundtheindustryaverage.
2010 2011 2012 2013 2014 Industry
Average
NPM (%) 4.2 -3.1 -8.8 1.9 -1.9 14.1
5. 12810977 John Hunt 16/05/2014
5
Return on capital employed
Return on capital employed indicates the amount of wealth generated compared to the
amount of wealth invested. It is calculated by dividing net profit by total assets minus
current liabilities. As ROCE is calculated using net profit weare going to see a similar
result to the NPM, as for the years 2011, 2012 and 2014 Nokia made a net loss therefore
there is going to be a negative return on any capital employed forthose years. For the
year 2010 Nokia made an 8.3% return on capital employed the followingyear it
dropped by almost 15% to minus 6.4% the reason forthe huge drop is due to that fact
that the amount of capital employed stays relatively stable around 2,000 EURmbut
there is a drastic fall in net profit from1786 EURm to negative 1198 EURm. Nokia’s
ROCE is well below the industry average
2010 2011 2012 2013 2014 Industry
Average
ROCE
(%)
8.3 -6.4 -17.3 1.5 -1.72 16.3
Liquidity Ratios
Liquidity ratios lookat how effectively companies can pay off their short-term debts. Bill
Rees (1995) once stated, “Theequity investor may concentrateon the long-run cash-
generating prospects of the firm but if short run cash flow difficultieswill put the firm
into a receivership the long run becomes rather irrelevant.”
Current ratio
The Current ratio is achieved by dividing current assets by current liabilities. It attempts
to measure the ability a company has at meeting its financial obligations throughout the
year using its short-term assets such as cash and inventory. Nokia’s current ratio in
2010 starts at 1.55 then falls to 1.46 in 2011 and further more in 2012 to 1.43 this is due
to the increased fall in current assets compared to current liabilities. After 2012 Nokia’s
current ratio start to increase reaching 1.54 in 2013 and 1.88 in 2014 which is above the
industry average. Due to the factNokia have above the industry average current ratio
results they should be able to obtain refinancing funds at competitive rates as they show
they are able to pay off all its short-term obligations.
2010 2011 2012 2013 2014 Industry
Average
Current
Ratio
1.55 1.46 1.43 1.54 1.88 1.64
Acid Test (also known as Quick Ratio)
This financial tool is very similar to the current ratio but instead uses current assets
minus inventories divided by current liabilities. The Acid Test doesn't take inventory
into account as most people fail to see it as a means to liquidate cash quickly. Nokia’s
Acid test results follow the same trend as their current ratio results; this is due to the
factthat Nokia’s inventories as a percentage of current assets stay relatively stable.
6. 12810977 John Hunt 16/05/2014
6
2010 2011 2012 2013 2014 Industry
Average
Acid test 1.40 1.33 1.32 1.37 1.71 1.46
Operating cash flow to current liabilities
Operating cash flow to current liabilities is calculated by dividing cash flow from
operations by current liabilities. Operating cash flow to current liabilities measures how
well a company can coverits current liabilities using cash flow generated froma
company’s operations. A measure of how well current liabilities are coveredby the cash
flow generated from a company's operations. Using operating cash flow opposed to
income often provides a better indication of liquidity simply because bills are normally
paid via cash. As youcan see from the table below all of Nokia’s results between 2010
and 2014 are below 1 whichindicates that they are not able to liquidate its current
liabilities from operating cash flow;in other words Nokia willhave to sell assets, borrow
money or issue stocks to meet its short term debt obligations.
2010 2011 2012 2013 2014 Industry
Average
Operating
CF to
Current
Liabilities
0.272 0.065 -0.024 0.0076 0.075 0.68
Efficiency ratios
Efficiency ratiosmeasure how well companies utilize their assets to generate income.
According to (PeterAtrill,1997) ‘Efficiency ratiosexamine the waysin whichvarious
resources of the business are managed.’
Total Asset Turnover (TAT)
TAT is calculated by dividing total revenue by total assets, TAT gives an indication of
how efficiently a company uses their assets to generate income. Nokia’s TAT stay
relatively constant between the years of 2010, 2011 and 2012 before halving from1.01
to 0.51 in 2013. Nokia’s TAT decline can be attributed to the significant drop in sales
from 30176EURm to 12709EURm between 2012 and 2013.
2010 2011 2012 2013 2014 Industry
Average
Total
Asset
Turnover
1.08 1.07 1.01 0.51 0.59
7. 12810977 John Hunt 16/05/2014
7
Accounts receivable Turnover (ART)
ART is total revenue over accounts receivable, as ART indicates a company’s ability to
collectits receivables the higher the ratio the more efficient.Nokia’s ART starts at 5.46
in 2010 then drops to 5.24 then again to 4.74 and in 2013 it drops further to 3.01. Its not
until 2014 that Nokia’s ART rapidly grows to 12.25 this is due to their average accounts
receivable dropping from 4226 to 1039 whilst their revenue stayed almost the same.
2010 2011 2012 2013 2014 Industry
Average
Acct
receivable
Turnover
5.46 5.24 4.74 3.01 12.25
Payables Turnover (days)
Payables turnover measures the speed at which a company pays its suppliers. It is
calculated by dividing accounts payable by costof sales and multiplying by 365. Nokia’s
payables turnover is around the industry average of 70.98 days forthe years of 2010,
2011 and 2012 before increasing to 91.29 in 2013 then again to 119 in 2014 this shows
that Nokia are taking longer to pay their suppliers in recent years this is most likely
down to cash flow problems.
2010 2011 2012 2013 2014 Industry
Average
Payables
Turnover
75.16 73.85 73.6 91.29 119 70.98
Financial Risk Ratios
Capital Gearing Ratio
Dividing non-current liabilities by share capital, retained earnings and non-current
liabilities and presenting it as a percentage formulate gearing. Nokia’s gearing rose from
37.48 to 58% between 2011 and 2012 this was due to the fallin retained earnings from
7385EURm to 3995EURm. It then reached it peak in 2013 with 60.63% of its funding
coming from outside sources whichis nearly 3 times the industry average.
2010 2011 2012 2013 2014 Industry
Average
Gearing
Ratio (%)
33.25 37.48 58.00 60.63 50.75 22.1
8. 12810977 John Hunt 16/05/2014
8
Debt Equity Ratio
Non-current liabilities divided by share capital plus retained earnings minus treasury
shares. This ratio measures the percentage of total funds provided by creditors. Nokia’s
debt to equity starts around 60% whichis close to the industry average of 52.4% it then
increases to 160% in 2012 then again in 2013 to 195% due to the fallin retained
earnings. Nokia’s retained earnings and treasury shares increased resulting in the
decrease to 128.7%.
2010 2011 2012 2013 2014 Industry
average
Debt
Equity
(%)
53.1% 65.1% 162.1% 195.7% 128.7% 52.4
Return to Investors Ratios
Return to Investors ratios allow investors to calculatethe return they will receive from
shares they invest in.
Earnings Per Share
Profitattributable to equity holders divided by average number of shares. Nokia’s EPS is
0.49 in 2010 before falling negative forthe next 3 years as Nokia aren’t making any
profit attributable to equity holders. In 2014 it then becomes 0.94, whichis still well
below the industry average.
2010 2011 2012 2013 2014 Industry
Average
Earnings per
share (€)
0.49 -0.31 -0.84 -0.17 0.94 68.4
Dividends per Share
‘DPS shows the amount of gross dividend, in pence, allotted to each equity share’ (Mills
and Robertson, 1999). Nokia’s DPS is €0.41 for years 2010 and 2011 before dropping to
0.2 in 2012 then drastically in 2013 to 0.019, it has since risen to 0.38 in 2015. Nokia’s
dividends per share are well below the average for our industry meaning shareholders
in Nokia are receiving much lower dividends compared to Apple and Samsung
2010 2011 2012 2013 2014 Industry
Average
Dividends
per share
(€)
0.41 0.41 0.20 0.019 0.38 4.77
9. 12810977 John Hunt 16/05/2014
9
Dividend cover ratio
‘Dividend coverratio shows the number of times dividend is coveredby earnings
attributable to shareholders’ (Mills and Robertson, 1999). It indicates to shareholders
how comfortably and company can pay their shareholders whilst retaining the funds to
reinvest in expansion. Nokia’s dividend cover is 1.20 in 2010 before falling negative for
the next three years as there is a loss attributable to shareholders. Nokia’s dividend
coverthen rises to 2.47 in 2014 due to the €0.45 increase in earnings per share that
year compared to 2010
2010 2011 2012 2013 2014 Industry
Average
Dividend
cover
ratio
1.20 -0.76 -4.2 -8.95 2.47 8.3
Macroeconomic Country Analysis
Nokia have already penetrated the markets, which are growing fastest such as
Asia, which look promising from an investor’s point of view. China’s rapid
economic growth, although slowing, is still higher than any other. With the
massive emerging middles classes demand for smart phones, Nokia’s sales in
China have increased by 17% in 2014 compared to 2013. Not only have the
number of Nokia sales in China been decreasing year on year since 2010 apart
from 2014 but Nokia have also moved many of their manufacturing plants out of
China and into Vietnam for the reduction in costs. In contrast to Asia, and other
countries such as China, the European telecommunications market makes up for
more than 30% of Nokia’s net sales in 2014, this however is a 1% decrease
compared to the year before. Considering recent events with the Euro and the
Economy as a whole its no surprise that since the recession hit in 2007 Nokia’s
share price has fallen upwards of 90% which has had drastic effects on Finnish
growth. At one point in time Nokia were paying as much as 23% of all Finnish
corporation tax and accounted for a fifth of Finland’s exports (The Economist,
2012). As of the 25th of April, 2014 Nokia completed the sale of all its Devices
and Services to Microsoft, Nokia also announced plans for a €5bn capital
structure optimization program to try and recommence dividend payments,
distribute excess capital and reduce interest bearing debt, this will be enticing to
new prospective investors and existing shareholders looking to receive
dividends.
Conclusion
As a whole, there are multiple factors for an investor to assess before investing
into Nokia. On the one hand it seems like a highly risky investment due to the
fact that its Return to investor ratios show that Nokia’s earnings per share and
Dividends per share are well below the industry average. It’s not only the return
to investor ratios that are below the industry average it's the same story with the
Financial risk ratios which show Nokia’s gearing level well above the industry
10. 12810977 John Hunt 16/05/2014
10
average at 50.75% in 2014 along with a Debt:Equity ratio of 128.7 more than
double the industry average. However, even though Nokia’s results seem very
poor compared to the industry its evident that Nokia understand and have begun
to start reacting to the changes in the market. Nokia have invested greatly into
research and development in recent years and we are starting to see a significant
improvement appear within all the results in 2014 compared to 2013 therefore
this may lead you to believe that Nokia are starting to stabilise and gives promise
for investors wanting to pick up shares in Nokia at a reduced price expecting
them to produce positive returns in the future.
11. 12810977 John Hunt 16/05/2014
11
Appendix- Ratios and Calculations
Gross profit Margin
2010 2011 2012 2013 2014
Equation Revenues-cost of
sales=GP
GP/Revenues x 100
Revenues-cost of
sales=GP
GP/Revenues x 100
Revenues-cost of
sales=GP
GP/Revenues x 100
Revenues-cost of
sales=GP
GP/Revenues x
100
Revenues-cost of
sales=GP
GP/Revenues x 100
Workings 42446-29629=12817
12817/42446x100=30.2
38659-
27340=11319
11319/38659x100
=29.28
30176-21786=8390
8390/30176x100=27.8
12709-
7364=5345
5345/12709x100
=42.1
12732-7094=5638
5638/12732x100=44.3
Answer 30.2% 29..28% 27.8% 42.1% 44.3%
Net Profit
2010 2011 2012 2013 2014
Equation Net profit margin=
NP/revenues x 100
Net profit margin=
NP/revenues x 100
Net profit margin=
NP/revenues x 100
Net profit margin=
NP/revenues x 100
Net profit margin=
NP/revenues x 100
Workings 1786/42446x100
=4.21
-1198/38659x100
=-3.10
-2644/30176x100
=-8.76
243/12709x100
=1.91
-237/12732x100
=-1.86
Answer 4.21% -3.10% -8.76% 1.91% -1.86%
ROCE
2010 2011 2012 2013 2014
Equation Net profit before
interest + tax/total
assets – current
liabilities x 100
Net profit before
interest + tax/total
assets – current
liabilities x 100
Net profit before
interest + tax/total
assets – current
liabilities x 100
Net profit before
interest + tax/total
assets – current
liabilities x 100
Net profit before
interest + tax/total
assets – current
liabilities x 100
Workings 1786/(39123-17540)
x100= 8.28
-1198/(36205-
17444)x100= -6.39
-2644/(29949-
14646)x100= -17.28
243/(25191-
9450)x100=1.54
-237/(21063-
7288)x100=1.72
Answer 8.3% -6.4% -17.3% 1.5% 1.7%
12. 12810977 John Hunt 16/05/2014
12
Liquidity Calculations
Current Ratio
2010 2011 2012 2013 2014
Equation Current Assets/
Current liabilities
Current Assets/ Current
liabilities
Current Assets/
Current liabilities
Current Assets/
Current liabilities
Current Assets/
Current liabilities
Workings 27145/17540=1.55 25455/17444=1.46 20878/14646=1.43 13796/9450=1.37 13724/7288=1.88
Answer 1.55 1.46 1.43 1.37 1.88
Acid Test (Quick Ratio)
2010 2011 2012 2013 2014
Equation Current assets-
inventories/current
liabilities
Current assets-
inventories/current
liabilities
Current assets-
inventories/current
liabilities
Current assets-
inventories/current
liabilities
Current assets-
inventories/current
liabilities
Workings 27415-
2523/17540=1.40
25455-
2330/1744=1.33
20878-
1538/14646=1.32
13796-
804/9450=1.37
13724-
1275/7288=1.71
Answer 1.4 1.33 1.32 1.37 1.71
Operating Cash Flow to Current Liabilities
2010 2011 2012 2013 2014
Equation Net Cash flow from
operating
activities/Current
Liabilities
Net Cash flow from
operating
activities/Current
Liabilities
Net Cash flow from
operating
activities/Current
Liabilities
Net Cash flow from
operating
activities/Current
Liabilities
Net Cash flow from
operating
activities/Current
Liabilities
Workings 4774/17540
=0.272
1137/17444
=0.065
-354/14646
=-0.0241
72/9450
=0.0076
1275/7288
=0.1749
13. 12810977 John Hunt 16/05/2014
13
Answer 0.272 0.065 -0.024 0.0076 0.175
Efficiency Calculations
Total asset turnover
2010 2011 2012 2013 2014
Equation Sales revenue/ Total
assets
Sales revenue/ Total
assets
Sales revenue/ Total
assets
Sales revenue/ Total
assets
Sales revenue/ Total
assets
Workings 42446/39123=1.08 38659/36205=1.07 30176/29949=1.01 12709/25191=0.51 12732/21663=0.59
Answer 1.08 1.07 1.01 0.51 0.59
Accounts receivable
2010 2011 2012 2013 2014
Equation Sales revenue/
average accounts
receivable
Sales
revenue/ average
accounts receivable
Sales revenue/
average accounts
receivable
Sales revenue/
average accounts
receivable
Sales revenue/
average accounts
receivable
Workings 42446/
((7570+7981)/2)
=5.46
38659/
((7181+7570)/2)
=5.24
30176/
((5551+7181)/2)
=4.74
12709/
((2901+5551)/2)
=3.01
12732/
((1275+804)/2)
=12.25
Answer 5.46 5.24 4.74 3.01 12.25
Payables Turnover
2010 2011 2012 2013 2014
Equation Accounts
payable/ cost of
sales x365
Accounts
payable/ cost of
sales x365
Accounts
payable/ cost of sales
x365
Accounts payable/
cost of sales x365
Accounts payable/
cost of sales x365
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Workings 6101/29629
x365=75.158
5532/27340
x365=73.85
4394/21786
x365=73.6
1842/7364
x365=91.29
2313/7094
x365=119
Answer 75.16 73.85 73.6 91.29 119
Financial Risk Ratios
Gearing Ratio
2010 2011 2012 2013 2014
Equation Non current
liabilities/ non
current liabilities
+ share capita +
retained earnings
Non current
liabilities/ non
current liabilities
+ share capita +
retained earnings
Non current
liabilities/ non
current liabilities
+ share capita +
retained earnings
Non current
liabilities/ non
current liabilities
+ share capita +
retained earnings
Non current
liabilities/ non
current liabilities
+ share capita +
retained earnings
Working
s
5352/246+10500
+5352
=33.25
4845/246+7836+
4845
=37.48
5856/246+3995+
5856
=57.99
4353/246+2581+
4353
=60.63
5106/246+4710+
5106
=50.75
Answer 33.3% 37.5% 58% 60.6% 50.75%
Debt to Equity
2010 2011 2012 2013 2014
Equation Non current
liabilities/ share
capital +
retained
earnings –
treasury shares
Non current
liabilities/
share capital +
retained
earnings –
treasury shares
Non current
liabilities/
share capital +
retained
earnings –
treasury shares
Non current
liabilities/ share
capital + retained
earnings – treasury
shares
Non current
liabilities/ share
capital + retained
earnings – treasury
shares
Working
s
(5352/246+105
00-663) x100
=53.079
(4845/246+783
6-644) x100
=65.138
(5856/246+399
5-629) x100
=162.126
(4353/246+2581-
603) x100
=195.728
(5106/246+4710-
988) x100
=128.679
Answer 53.1% 65.1% 162.1% 195.7% 128.7%
Return to investor ratios
Earnings per share
2010 2011 2012 2013 2014
Equation Profit attributable to
equity
holders/average no.
of shares
Profit attributable to
equity holders/average
no. of shares
Profit attributable to
equity
holders/average no.
of shares
Profit attributable to
equity
holders/average no.
of shares
Profit attributable to
equity
holders/average no.
of shares
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Workings 1850000000/
3708816000
=0.49
-1164000000/
3709947000
=-0.31
-3106000000/
3710845000
=-0.84
-615000000/
3712079000
=-0.17
3462000000/
3698723000
=0.94
Answer €0.49 -€0.31 -€0.84 -€0.17 €0.94
Dividends Per Share
2010 2011 2012 2013 2014
Equation Dividends/ number
of shares
Dividends/ number of
shares
Dividends/ number
of shares
Dividends/ number
of shares
Dividends/ number of
shares
Workings 1519000000/
3708816000
=0.41
1536000000/
3709947000
=0.41
755000000/
3710845000
=0.20
71000000/
3712427000
=0.019
1392000000/
3648143000
=0.3815
Answer €0.41 €0.41 €0.20 €0.02 €0.38
Dividend cover
2010 2011 2012 2013 2014
Equation Earnings per share/
dividends per share
Earnings per share/
dividends per share
Earnings per share/
dividends per share
Earnings per share/
dividends per share
Earnings per share/
dividends per share
Workings 0.49/0.41=1.195 -0.31/0.41=-0.756 -0.84/0.2=-4.2 -0.17/0.019=-8.947 0.94/0.38=2.473
Answer 1.2 -0.8 -4.2 -8.9 2.5
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References
Bill Rees. (1995). Ratio Analysis: Methods and Issues. In: Prentice Hall Europe Financial
Analysis . 2nd ed. Hemel Hempstead: Prentice Hall Europe. 98.
Catherine Gowthrope (2005). Business Accounting and Finance for non-specialists . 2nd
ed. London: Patrick Bond. p 299
Oswald D. Bowlin, John D. Martin, David F. Scott (1991). Financial Analysis . 2nd ed.
Maidenhead: McGraw-Hill Inc.,US; 2nd Revised edition edition. p29
Peter Atrill (1997). Financial Management For Decision Markers . 5th ed. Harlow:
Prentice Hall Europe. p 79.
Roger W. Mills and John Robertson (1999). Fundamentals of Managerial Accounting And
Finance . 4th ed. Great Britain: Redbooks LTD. p 127.
Roger W. Mills and John Robertson (1999). Fundamentals of Managerial Accounting And
Finance . 4th ed. Great Britain: Redbooks LTD. p 140.
Roger W. Mills and John Robertson (1999). Fundamentals of Managerial Accounting And
Finance . 4th ed. Great Britain: Redbooks LTD. p 148.
The Economist . (2012). The Nokia Effect . Available:
http://www.economist.com/node/21560867. Last accessed 15th May 2014.
17. 12810977 John Hunt 16/05/2014
17
Bibliography
Bill Rees. (1995). Ratio Analysis: Methods and Issues. In: Prentice Hall Europe Financial
Analysis . 2nd ed. Hemel Hempstead: Prentice Hall Europe. 98.
Catherine Gowthrope (2005). Business Accounting and Finance for non-specialists . 2nd
ed. London: Patrick Bond. p 299
Oswald D. Bowlin, John D. Martin, David F. Scott (1991). Financial Analysis . 2nd ed.
Maidenhead: McGraw-Hill Inc.,US; 2nd Revised edition edition. p29
Peter Atrill (1997). Financial Management For Decision Markers . 5th ed. Harlow:
Prentice Hall Europe. p 79.
Roger W. Mills and John Robertson (1999). Fundamentals of Managerial Accounting And
Finance . 4th ed. Great Britain: Redbooks LTD. p 127.
Roger W. Mills and John Robertson (1999). Fundamentals of Managerial Accounting And
Finance . 4th ed. Great Britain: Redbooks LTD. p 140.
Roger W. Mills and John Robertson (1999). Fundamentals of Managerial Accounting And
Finance . 4th ed. Great Britain: Redbooks LTD. p 148.
The Economist . (2012). The Nokia Effect . Available:
http://www.economist.com/node/21560867. Last accessed 15th May 2014.
http://company.nokia.com
http://www.londonstockexchange.com/home/homepage.htm
http://www.ft.com/home/uk