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Running head FINANCIAL ANALYSIS OF LOWE’S COMPANY .docxwlynn1
Running head: FINANCIAL ANALYSIS OF LOWE’S COMPANY 1
FINANCIAL ANALYSIS OF LOWE’S COMPANY 11
Financial Analysis of Lowe’s Company
Introduction
Lowes Company is a national store that was founded in the year 1948. The company was first opened in North Carolina and it was among the first retailer companies in America back then. The company mainly dealt with home equipment and appliances. Moreover, the company is said to have been generating huge revenues back then when it began. The company continued to thrive in its operations as it opened up approximately 2390 stores across the world. The company also promoted social responsibility in the society as it has so far employed around 310, 000 individuals in its stores worldwide. However, in the past years, the performance of the company began deteriorating and a financial analysis has to be carried out in order to know the problem.
Body
Common size income statement
year
2018
2017
2016
2015
Net sales
100
100
100
100
Cost of sales
65.89
65.45
65.18
65.21
Gross margin
34.11
34.55
34.82
34.79
Selling, general exp
22.41
23.27
23.88
23.61
Depreciation and amortization
2.11
2.29
2.53
2.66
Operating income
9.60
8.99
8.41
8.52
Interest expense
0.93
1.00
0.93
0.92
Amortization
0.02
0.02
0.01
0.01
Interest income
0.02
0.02
0.01
0.01
Interest net
0.92
0.99
0.93
0.92
Loss on extinguishment of debt
0.68
-
-
-
Pre-tax earnings
8.00
8.00
7.48
7.61
Income tax provisions
2.98
3.24
3.17
2.81
Net earnings
5.02
4.76
4.31
4.80
A common size financial statement is a document that is used in doing comparison of financial information. The values of the common size income statement are normally converted as a percentage of the returns. From the common size income statement it is clear that the cost of sales increases over the years. The cost of sales in 2015 was 65.21 and in 2018 the cost of sales was 65.89. However, the gross margin is decreasing over the years. A gross margin is the amount that is the revenue that is collected in each commodity that is sold. The decrease in the gross margin is an indicator that the company is not performing well financially. Companies should have a high gross margin so that they can be able to meet other financial obligations.
Moreover, from the common size financial statement of analysis, it can be seen that the pretax earnings decreased slightly in 2015 and 2016 and then remained stable for the next two years[footnoteRef:1]. In addition, the interest net, interest income and the amortization are a clear indication that the company is carrying out proper investments using the shareholders property and wealth. The extra investments will enable the company to have a high debt to equity ratio and eventually the return on equity will increase greatly. Firms that have a high return on equity also have a greater ability to meet the day to day expenses. Therefore, firms are.
General Electric 14General ElectricFinanc.docxbudbarber38650
General Electric 14
General Electric
Financial Analysis
Nicole Henry
EXECUTIVE SUMMARY
General Electric has been in business for over a century now and the inception of the dynamo has been the key to one of the largest global names. The company has been able to financially provide for the electrical and then today in the financial sector as well. This is reflected in the financial position of the company which has performed in the double digits during tough times. When analyzing the financial position of the company, it is evident that the performance that the company had been gaining for over a period has now started seeing a settlement impact. This means that the growth perspective that the company was seeing over the last couple of years have now subsided. The impact of growth is visible in the current year where the company’s financial position took a dip. Although the dip is the settlement of the exceeding performance; and has a subsided impact from the financial crunch in the previous decade around the globe.
ANALYSIS OVERVIEW
In order to analyze a company which has its operations in different business factions there are certain questions that need to be raised. The first question is that with such a gigantic business across the globe, is it feasible to break the financial analysis on a business wise or is the company feasible to be analyzed in a single entity perspective. The perspective reveals that the company analyzes its performance as a single entity and hence all the stakeholders are considered under a single arena. Thence, the review has to be taken in the single entity perspective. Along with this, there is a portion of performance review which is to set the trends for the future. The perspective cannot be taken as the downward trend, but this has to be taken as a moving average of the recent years. The financial analysis will reveal what factions of the company underperformed and led to a decrease in the financial position. The financial ratios used in the study reveal the position and performance of the company in the perspective of how each pillar has performed. This ratio analysis will also be an intricate combination of the businesses of the company to augment each pillar.
ASSUMPTIONS
The basis for carrying out the financial analysis for the company involves the changing trends of the company and the industry itself. Although the company’s financial positions appear to present strong performance, the underlying belief is that the company is now in a position where the product and service demand is increasing. Connecting the dots, the company is carrying out the sales with controlled receivables. The assumption set here is that the company’s growth in sales trends for products and services is not driven through increasing credit exposure. Along with this, there is an increased trend for cost hikes. This is assumed to be driven from the pricing positions in the market and the underlying costs requir.
Equity-Investment Analyst who have been working in the financial markets for over 35 years. A University of Pennsylvania Wharton School of Business Graduate, an Investment and Financial leader on Capital Hill in Washington, DC and 20 years of financial modeling and analysis consulting experience. I am a teacher, a mentor and accomplished businessman eager to share my experience, and helpful advice
Running head FINANCIAL ANALYSIS OF LOWE’S COMPANY .docxwlynn1
Running head: FINANCIAL ANALYSIS OF LOWE’S COMPANY 1
FINANCIAL ANALYSIS OF LOWE’S COMPANY 11
Financial Analysis of Lowe’s Company
Introduction
Lowes Company is a national store that was founded in the year 1948. The company was first opened in North Carolina and it was among the first retailer companies in America back then. The company mainly dealt with home equipment and appliances. Moreover, the company is said to have been generating huge revenues back then when it began. The company continued to thrive in its operations as it opened up approximately 2390 stores across the world. The company also promoted social responsibility in the society as it has so far employed around 310, 000 individuals in its stores worldwide. However, in the past years, the performance of the company began deteriorating and a financial analysis has to be carried out in order to know the problem.
Body
Common size income statement
year
2018
2017
2016
2015
Net sales
100
100
100
100
Cost of sales
65.89
65.45
65.18
65.21
Gross margin
34.11
34.55
34.82
34.79
Selling, general exp
22.41
23.27
23.88
23.61
Depreciation and amortization
2.11
2.29
2.53
2.66
Operating income
9.60
8.99
8.41
8.52
Interest expense
0.93
1.00
0.93
0.92
Amortization
0.02
0.02
0.01
0.01
Interest income
0.02
0.02
0.01
0.01
Interest net
0.92
0.99
0.93
0.92
Loss on extinguishment of debt
0.68
-
-
-
Pre-tax earnings
8.00
8.00
7.48
7.61
Income tax provisions
2.98
3.24
3.17
2.81
Net earnings
5.02
4.76
4.31
4.80
A common size financial statement is a document that is used in doing comparison of financial information. The values of the common size income statement are normally converted as a percentage of the returns. From the common size income statement it is clear that the cost of sales increases over the years. The cost of sales in 2015 was 65.21 and in 2018 the cost of sales was 65.89. However, the gross margin is decreasing over the years. A gross margin is the amount that is the revenue that is collected in each commodity that is sold. The decrease in the gross margin is an indicator that the company is not performing well financially. Companies should have a high gross margin so that they can be able to meet other financial obligations.
Moreover, from the common size financial statement of analysis, it can be seen that the pretax earnings decreased slightly in 2015 and 2016 and then remained stable for the next two years[footnoteRef:1]. In addition, the interest net, interest income and the amortization are a clear indication that the company is carrying out proper investments using the shareholders property and wealth. The extra investments will enable the company to have a high debt to equity ratio and eventually the return on equity will increase greatly. Firms that have a high return on equity also have a greater ability to meet the day to day expenses. Therefore, firms are.
General Electric 14General ElectricFinanc.docxbudbarber38650
General Electric 14
General Electric
Financial Analysis
Nicole Henry
EXECUTIVE SUMMARY
General Electric has been in business for over a century now and the inception of the dynamo has been the key to one of the largest global names. The company has been able to financially provide for the electrical and then today in the financial sector as well. This is reflected in the financial position of the company which has performed in the double digits during tough times. When analyzing the financial position of the company, it is evident that the performance that the company had been gaining for over a period has now started seeing a settlement impact. This means that the growth perspective that the company was seeing over the last couple of years have now subsided. The impact of growth is visible in the current year where the company’s financial position took a dip. Although the dip is the settlement of the exceeding performance; and has a subsided impact from the financial crunch in the previous decade around the globe.
ANALYSIS OVERVIEW
In order to analyze a company which has its operations in different business factions there are certain questions that need to be raised. The first question is that with such a gigantic business across the globe, is it feasible to break the financial analysis on a business wise or is the company feasible to be analyzed in a single entity perspective. The perspective reveals that the company analyzes its performance as a single entity and hence all the stakeholders are considered under a single arena. Thence, the review has to be taken in the single entity perspective. Along with this, there is a portion of performance review which is to set the trends for the future. The perspective cannot be taken as the downward trend, but this has to be taken as a moving average of the recent years. The financial analysis will reveal what factions of the company underperformed and led to a decrease in the financial position. The financial ratios used in the study reveal the position and performance of the company in the perspective of how each pillar has performed. This ratio analysis will also be an intricate combination of the businesses of the company to augment each pillar.
ASSUMPTIONS
The basis for carrying out the financial analysis for the company involves the changing trends of the company and the industry itself. Although the company’s financial positions appear to present strong performance, the underlying belief is that the company is now in a position where the product and service demand is increasing. Connecting the dots, the company is carrying out the sales with controlled receivables. The assumption set here is that the company’s growth in sales trends for products and services is not driven through increasing credit exposure. Along with this, there is an increased trend for cost hikes. This is assumed to be driven from the pricing positions in the market and the underlying costs requir.
Equity-Investment Analyst who have been working in the financial markets for over 35 years. A University of Pennsylvania Wharton School of Business Graduate, an Investment and Financial leader on Capital Hill in Washington, DC and 20 years of financial modeling and analysis consulting experience. I am a teacher, a mentor and accomplished businessman eager to share my experience, and helpful advice
9 Important Things To Consider In Quarterly Results Before Investing In Stock...ZyloStar
The Global exchange-listed companies must file their quarterly results with the stock market for the four quarters ending in June, September, December, and March. The March results also will include the annual results of the corporate.
We have picked up HUL balance sheets of years from ACE-Equity and applied some ratio analysis to analyze the trend and predict next year results of the company.
Running Head: FINANCIAL ANALYSIS
1
FINANCIAL ANALYSIS
7
Financial Analysis
Students Name
Institutional Affiliation
Executive summaryThis report created from the financial statements of The Coca-Cola Company (KO) provides an analysis and evaluation of the actual and the prospective liquidity, profitability and the financial stability of the company. The methods that have been used in the analysis include trend analysis, the vertical analysis and the horizontal analysis. Also we have used certain analysis such as Quick ratio, debt ratio, and the current ratios. More calculations that have been used includes the returns on the owners equity, the earning per share, net operating working capital, total operating capital, net operating capital, net operating profit after taxes, operating cash flow and free cash flow. A result from the data reveals that, all the company ratios are above the industries averages. Comparative performance is good in the area of the liquidity, credit control and inventory management.
The report finds that the tidings for the company are positive in the near future. The major areas of weakness highlighted require further investigation and immediate action by management. The recommendations that were provided include;
· Improving the average accounts receivable collection period,
· Raising/ increasing the inventory turnover and reduction of prepayments in order to have enough operating cash for the subsequent periods.
The investigation in this report also had its shortcomings that arose and are highlighted as;
The forecasted figures used are estimates that sometimes maybe arbitrate; we also cannot fully provide data on the position of other companies with the data limitation we have experienced. The monthly details would have given us more information from which we could base a proper in year trend analysis, rather than the blanket whole year analysis provided. Though we had the above mentioned strain in preparation of this report, we still great belief that the analysis provided is best suited to show the standing of the Coca-Cola Company (KO).
In the financial report below, the strengths, weakness, opportunity and threats have been highlighted as we analyze the various financial sub segments.
Identify your company, its industry, and analyze the important segments (percentage of sales or subsidiaries) of your company compared to its industry and its overall business
The Coca-Cola Company (KO) is a multinational American Company that has its headquarters at Atlanta Georgia. The company has got its branches in more than 200 countries in the world and majority of its sales is in America, amounting to 40% of the total sales. The company operates in the non alcoholic beverage industry made up of the following companies as the main rivals, Dr Pepper Snapple Group, Inc, Nestle and Pepsi Inc. the company is the best performer in market capitalization compared to competitors with a capitalization of 169.49billion, higher .
Introduction to ratio analysis. This slide show is an analysis of accounting ratios to introduce students and those interested in taking accounting as their future career into ratio analysis. It's been simplified and made concise. The writer is a lecturer in engineering and a financial engineer. You can always follow the writer on LinkedIn, Twitter of Facebook. You comments are also welcome for future work.
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9 Important Things To Consider In Quarterly Results Before Investing In Stock...ZyloStar
The Global exchange-listed companies must file their quarterly results with the stock market for the four quarters ending in June, September, December, and March. The March results also will include the annual results of the corporate.
We have picked up HUL balance sheets of years from ACE-Equity and applied some ratio analysis to analyze the trend and predict next year results of the company.
Running Head: FINANCIAL ANALYSIS
1
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Executive summaryThis report created from the financial statements of The Coca-Cola Company (KO) provides an analysis and evaluation of the actual and the prospective liquidity, profitability and the financial stability of the company. The methods that have been used in the analysis include trend analysis, the vertical analysis and the horizontal analysis. Also we have used certain analysis such as Quick ratio, debt ratio, and the current ratios. More calculations that have been used includes the returns on the owners equity, the earning per share, net operating working capital, total operating capital, net operating capital, net operating profit after taxes, operating cash flow and free cash flow. A result from the data reveals that, all the company ratios are above the industries averages. Comparative performance is good in the area of the liquidity, credit control and inventory management.
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· Improving the average accounts receivable collection period,
· Raising/ increasing the inventory turnover and reduction of prepayments in order to have enough operating cash for the subsequent periods.
The investigation in this report also had its shortcomings that arose and are highlighted as;
The forecasted figures used are estimates that sometimes maybe arbitrate; we also cannot fully provide data on the position of other companies with the data limitation we have experienced. The monthly details would have given us more information from which we could base a proper in year trend analysis, rather than the blanket whole year analysis provided. Though we had the above mentioned strain in preparation of this report, we still great belief that the analysis provided is best suited to show the standing of the Coca-Cola Company (KO).
In the financial report below, the strengths, weakness, opportunity and threats have been highlighted as we analyze the various financial sub segments.
Identify your company, its industry, and analyze the important segments (percentage of sales or subsidiaries) of your company compared to its industry and its overall business
The Coca-Cola Company (KO) is a multinational American Company that has its headquarters at Atlanta Georgia. The company has got its branches in more than 200 countries in the world and majority of its sales is in America, amounting to 40% of the total sales. The company operates in the non alcoholic beverage industry made up of the following companies as the main rivals, Dr Pepper Snapple Group, Inc, Nestle and Pepsi Inc. the company is the best performer in market capitalization compared to competitors with a capitalization of 169.49billion, higher .
Introduction to ratio analysis. This slide show is an analysis of accounting ratios to introduce students and those interested in taking accounting as their future career into ratio analysis. It's been simplified and made concise. The writer is a lecturer in engineering and a financial engineer. You can always follow the writer on LinkedIn, Twitter of Facebook. You comments are also welcome for future work.
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2. Executive Summary
This report intends to provide an overview of Telstra Corporation Limited and conduct analysis
of the several aspects of the financial statements of the company. This shall include various items
from the cash flow statements, balance sheets and the profit and loss account for the last six
years i.e. 2010 to 2015. The report intends to address the significant areas of performance by the
company by conducting ratio analysis and itemized study of important items and thereby
focusing on the areas to be improved by the company. External influences that do not cover the
financial aspect but may affect the investor’s decision have been also identified and discussed.
These include the market rating given by various credit rating agencies and the study of the
industry in which the company belongs because the company does not function as an
independent entity and its success and failure depends on lots of factors.
3. Contents
Executive Summary.......................................................................................................................................2
Introduction ..................................................................................................................................................4
Analysis of Income Statement ....................................................................... Error! Bookmark not defined.
Analysis of Balance Sheet .............................................................................. Error! Bookmark not defined.
Analysis of Cash Flow Statement................................................................... Error! Bookmark not defined.
Analysis of Ratios ........................................................................................... Error! Bookmark not defined.
Analysis .....................................................................................................................................................8
External Factors ............................................................................................. Error! Bookmark not defined.
Conclusion...................................................................................................................................................14
Appendices..................................................................................................................................................15
Appendix A-1 Ratio calculation...............................................................................................................15
Appendix A-2 Ratio calculation...............................................................................................................16
Appendix B Profit and loss account ........................................................................................................17
Appendix C Balance sheet.......................................................................................................................18
Appendix D Cash flow statements..........................................................................................................19
Appendix E- Solvency ratio calculation…………..………………………………………………………………………………… 17
Appendix F Revenue expenses..............................................................................................................218
4. Introduction
Telstra Corporation Limited is the biggest market player in mobile telecom in Australia (Telstra
2016). The company was founded in the year 1975. The company privatized in the years of
1997, 1999 and the year 2006 in three stages. The company originated from the Australia post as
one of the government departments. It operates mobile towers, pay television, internet access etc.
Currently, Andy Penn is the Chief Executive Officer of the company. Warwick Bray is the Chief
Financial Officer of the company. As of 2015, the total revenue of the company stands at $26.6
billion and the profit after tax stands at $4.3 billion (Thomson Reuters 2016). Telstra has been
voted as the most respected company in the year of 2014 by a leading Australian newspaper.
Telstra in order to win back its market share has separately allocated a huge sum of money which
it intends to spend for the said purpose.
Analysis of Income Statement
• Operating revenue: The operating revenue of the company has remained almost consistent
over the past 6 years. Minimal growth is present in the revenue. Therefore, it can be stated that
the company has tried to retain its customers in the given years but has not been able to attract
new customers. This item was selected as the revenue is the main resource of the organization’s
survival (Telstra 2016). Following chart shows the revenue and its growth year wise:
5. Depreciation charged to the profit and loss account has been on a reducing trend for the past 6
years which implies that the company has not invested any funds in the procurement of capital
assets. This can be attributable to the nature of industry in which it is involved. However, it can
also be commented that the company has not expanded its operations for these years and so, it idi
not require any further capital asset. We can study the following chart
• Operating Expense: We can observe that the operating expense has also remained almost
consistent in the past 6 years. The main reason behind such consistency would be attributable to
24.4
24.6
24.8
25
25.2
25.4
25.6
25.8
26
1
Year 2010
Year 2011
Year 2012
Year 2013
Year 2014
Year 2015
2.6
2.7
2.8
2.9
3
3.1
3.2
3.3
3.4
3.5
Depriciation ($ billions)
2010
2011
2012
2013
2014
2015
6. the consistent operating revenue. This can also be seen as a positive factor because it would
ensure that the operating margin has not reduced in the years. These expenses are directly
attributable to operations therefore, it can be stated that the company is operating efficiently even
with consistent revenue.We may look at the following chart:
Analysis of Balance Sheet
• Current Investments: The investments have significantly reduced over the period of 6
years. This shows that the company has relied less on current investments for the income. This
also could be due to the fact that company has reduced the short-term borrowings to save on the
interest cost. Current investments are important as the liquidity of the company can only be
determined on the basis of short-term investments. They are strategically important to discharge
the short term future liabilities.
13
13.5
14
14.5
15
15.5
16
1
Year 2010
Year 2011
Year 2012
Year 2013
Year 2014
Year 2015
7. • Noncurrent investments: This has increased significantly over the last 6 years depicting the
fact that company has invested in good return investments due to which company is earning
more which is overall good for the growth of the company. We can also notice that the other
income of the company has also increased in the years.This term derives its importance as these
are generally items of high value which will not be redeemed in near future. The rate of return on
these items is also high.
• Account payable: This has increased marginally over the last 6 years by 4% which suggests
that the company maintains a traditional account payable ratio towards its creditors which
suggests a good financial capacity of the company to repay its creditors. Accounts payable is
important as the short term liability needs to be paid off company’s regular payments depicts its
financial ability to pay off its liabilities.
Analysis of Cash Flow Statement
• Investments: There is a change of 95% in the last years in investments which is a part of
investing activities. The company has actually been purchasing investments which are also
reflected in the balance sheet. This could be due to a company getting the higher return on these
long-term investments.
• Investment cash inflow: Company has the change of over 50% in the last 6 years in income
from investments. From the above point, it is clear that the company is purchasing long-term
investments and in return as is evident from the return on investment, the company is being paid
quite well.
8. • Payment to suppliers and employees: This has increased to 17% in the last 6 years. This is
attributable to the fact that sale of the company has increased due to which the production has
gone up creating more suppliers and hence more liability which in turn creates more payments.
These items seem to be in consonance natural business course of the company. This is a part of
operating activities.
Analysis of Ratios
Ratio - Refer Appendix A-1 and A-2 at the end
Analysis
Gross profit ratio
The GP ratio has been fluctuating over the last 6 years which is not a good sign for the
company’s growth as the sales of the company have remained almost consistent and the falling
GP suggests that the cost of goods sold of the company has increased.
Net profit ratio
38
40
42
44
2010
2011
2012
2013
2014
2015
Gross Profit Ratio
Gross Profit
Ratio
9. NP ratio, however, has increased in the last 3 years which implies that the company is operating
efficiently. This suggests that company is able to hold its place in the market well.
Debt equity ratio
Debt equity ratio is around 1 which suggests that company uses equity and outside debt almost
equally to meet its financial needs. However, the ratio is always over 1 therefore, the debt
financing has always remained higher and we can state that it is very important to have good
earnings in order to meet the debt obligations.
Debt Ratio
This is below 0.5 which suggests that company has enough assets to meet its debt obligations.
0
10
20
2010
2011
2012
2013
2014
2015
Net Profit Ratio
Net Profit
Ratio
0
0.5
1
1.5
2010
2011
2012
2013
2014
2015
Debt Equity Ratio
Debt
Equity
Ratio
10. Fixed Asset turnover ratio
This has been increasing over the last 6 years suggesting that the company is able to generate
more out of its fixed assets used in production.
Equity turnover ratio
This has increased and then decreased again over the past 6 years indicating that the company
uses how much equity to generate a particular level of sale. However, there is not much
significant change as such. The performance of the company seems reasonable.
0.34
0.36
0.38
0.4
0.42
2010 2012 2014
Debt Ratio
Debt Ratio
0
1
2 2010
2011
2012
2013
2014
2015
Fixed Asset
Turnover Ratio
Fixed Asset
Turnover
Ratio
11. Payout ratio
This has increased considerably since 2010 and then decreased again. However, we must
understand if the company pays the dividend, then the market value of the company decreases.
So, overall the shareholders of the company do not gain or lose in case of a dividend.
Dividend yield
This reflects the ratio between the market price per share and the dividend per share declared by
the company. This has actually decreased too much which is due to the fact that the Market price
per share has decreased considerably over the last 6 years. However, looking at the dividend
individually, the dividend has increased despite fall in the market share instilling confidence
among its shareholders.
1.5
2
2.5
2010
2011
2012
2013
2014
2015
Equity Turnover
Ratio
Equity
Turnover
Ratio
0
50
100
150 2010
2011
2012
2013
2014
2015
Payout Ratio
Payout
Ratio
12. Solvency ratio
The solvency ratio of the company is the measure company being solvent. In the given case the
solvency ratio of the company has been almost stagnant at 0.49 which seems a good sign.
However, this should be compared with other competitors to get the better idea.
Current Ratio
The current ratio of the company was 0.8 in 2010 which improved above in 2014 to 1.2.
However, it has declined to 0.9 which is still acceptable as the acceptable current ratio for any
company is generally 1.
0
5
10
15
2010
2011
2012
2013
2014
2015
Dividend Yeild
Dividend
Yeild
0.4
0.42
0.44
0.46
0.48
0.5 2010
2011
2012
2013
2014
2015
Solvency Ratio
Solvency
Ratio
13. External Factors
Market rating/ credit rating
The credit ratings given by various credit rating agencies must be considered before making an
investment decision in large companies. This is because these are professional agencies who take
into account all the monetary and nonmonetary factors which ultimately may affect the growth of
the company or the industry of the company have immense expertise in understanding the
business environment and the financial position based on policies of the government, other
external factors, thus ensuring the investors of a safe investment.
Business environment of the industry in which the company relates
If the company has the strong financial background and appears free from all the negative
financial indications, then the investor might consider the industry also in which the company
relates. For example, take a sugar industry. The company seems strong but a recent circulation
by the government has allowed the import of sugar at low prices which would directly affect the
company’s profitability. Now, the investor might want to reconsider the decision of investing in
that company even though as of now the company has strong financial base but soon the
0
0.5
1
1.5
2010
2011
2012
2013
2014
2015
Current Ratio
Current
Ratio
14. company may be severally affected by the change in the policy of import by the government due
to which the company may not be able to earn healthy profits or may altogether come in losses.
Conclusion
After studying the above points, it looks that the company has been able to maintain and sustain
the business it manages in Australia. The company has sustained the revenue collection and the
profit of the company seems overall well managed. However, the one thing which may bother
the current and the prospective customers is that the company has not been able to grow at a pace
that is expected from the company of such size and capacity. The revenue has increased
marginally by just 4% in the last 6 years which does not seem that impressive. In terms of profit
also, the company has not been able to grow at much pace. However, one good sign is that the
company has reduced the other overhead cost as the Net profit ratio has increased more than the
gross profit ratio. This suggests that company has been able to reduce the other indirect costs
incurred by the company in processes other than the manufacturing processes which implies that
the controlling steps must have been taken by the management (Edmunds, (n.d.))
22. References
(2016). Retrieved 8 April 2016, from https://www.telstra.com.au/aboutus/our-company
(2016). Retrieved 8 April 2016, from https://www.telstra.com.au/aboutus/investors/financial-
information/financial-results
(2016). Retrieved 8 April 2016, from https://www.telstra.com.au/content/dam/tcom/about-
us/investors/pdf%20D/telstra-financial-results-and-annual-report-year-ending-30-June-
2015.pdf
(2016). Retrieved 8 April 2016, from https://www.telstra.com.au/content/dam/tcom/about-
us/investors/pdf%20A/2014-Annual-Report.pdf
(2016). Retrieved 8 April 2016, from https://www.telstra.com.au/content/dam/tcom/about-
us/investors/pdf%20A/results-annual-report-2013.pdf
(2016). Retrieved 8 April 2016, from https://www.telstra.com.au/content/dam/tcom/about-
us/investors/pdf%20A/2012fy-results.pdf
(2016). Retrieved 8 April 2016, from https://www.telstra.com.au/content/dam/tcom/about-
us/investors/pdf%20B/2010-results.pdf
Telstra Corporation Ltd stock quote, Telstra Corporation Ltd company overview | Reuters
India. (2016). In.reuters.com. Retrieved 8 April 2016, from
http://in.reuters.com/finance/stocks/overview?symbol=TLS.AX
TLSYY Telstra Corp Ltd ADR Stock Performance of Total and Trailing Returns. (2016).
Performance.morningstar.com. Retrieved 8 April 2016, from
http://performance.morningstar.com/stock/performance-return.action?t=TLSYY