ACC 3015

ACC 3015
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Contents
Introduction......................................................................................................................................3
Section A.........................................................................................................................................3
Strategic plans..............................................................................................................................3
Evaluation of financial performance...........................................................................................4
Investment opportunity..............................................................................................................11
Section B........................................................................................................................................12
Sources of internal and external long-term finances.................................................................12
Stakeholder analysis..................................................................................................................13
Conclusion.....................................................................................................................................14
References......................................................................................................................................15
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Introduction
Financial performance analysis of a company is necessary for both company and investors to
assess their past and present information to decide on their future course of action (Song, Zhao
and Zeng, 2017). This report contains two sections. Section A contains financial performance
analysis of the three companies – Greencore Group Plc, Hilton Food Group Plc and Premier
Food Plc. All the three are UK based companies operating in food and drinks industry. In Section
B, identification and analysis of various sources of internal and external sources of finance
available to companies are discussed.
Section A
Strategic plans
Companies prepare strategic plans to outline the measures in which they want to achieve
long term targets and goals.
Greencore Group Plc – It has a vision of “making every day taste better” which forms the
basis of all its strategies. Company has three pillared strategy – growth, relevance and
differentiation and believes in four differentiators – people at the care, sustainability, great food
and excellence. Company is aiming to reclaim its customer base by improving their production
and distribution level. It is planning to increase its meal salads and chilled snacking this year
(Building back with confidence, 2020). They believe their capital allocation model provides
them a base building sustainability and strengthening resilience against dynamic and powerful
market impact. Their marketing is driven by core values – improving food safety, making
customers’ lives simpler and conservation but are marred by uncertainties posed due to Covid-19
pandemic and unclear Brexit policies.
Hilton Food Group Plc – The core values of the company that drives its strategy and
brand building is providing sustainable value growth to shareholders. They have adopted
expansionary policies as medium to grow and aims to improve their profitability by 3 pillar
policy - reducing unit cost, introducing new products range and diversifying their production and
distribution centres. They enter into agreements, mergers, acquisitions, joint ventures, etc. to
expand their business (Kusumah and Fabianto, 2018). They have acquired half stake in Dalco to
diversify into protein and growing vegetarian market, SV Cuisine Ltd to add slow cooked
products in their range, etc. They also have other investments like opening facilities in Poland
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and in Brisbane, Australia and partnership agreements with Tesco UK and Delhaize to pack all
of their read meats (Strategic Report, 2019).
Premier Food Plc – Main focus of company is on achieving profit oriented sustainable
growth model. For this, it has adopted the strategy of cost control. Company management has
recently undergone changes and new board aims to renew the operational processes to improve
profitability and cash flows. All the three companies are from food and drinks industry which
being critical were allowed to remain operational in the pandemic lock-down. However, with
reduced demand and disrupted supply chain, cost increased and compromised profitability. Other
than pandemic, it is also marred by uncertainties caused by unstable political and economic
environment of UK due to confusion over Brexit. However, it has developed policies to tackle it
anyways. It places high value on workforce engagement and development of new product ranges
to attract customers. For example, plant-based recipe brand PLANTASTIC (Strategic report,
2019-20).
Evaluation of financial performance
Below mentioned are comparative analysis of various financial and non-financial ratios of
the three chosen company:
Financial Ratios
Particulars 2019-20 2018-19 2017-18
Greencore Hilton Premier Greencore Hilton Premier Greencore Hilton Premier
Current
Ratio (in
x)
0.69 1.05 0.98 2.01 1.23 0.78 0.75 1.2 0.78
Gearing
(in %)
156.67 175.87 64.91 90.47 66.57 105.83 119.39 36.16 106.9
RoE using
net
income
(in %)
34.66 17.23 2.77 4.55 17.95 -3.51 1.72 15.2 0.76
RoCE
using net
income
19.12 9.02 3.37 4.8 11.98 1.16 2.58 12.43 2.94
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