Rexam Financial Analysis

This assignment requires a comprehensive analysis of Rexam's financial statements spanning several years. It focuses on understanding the company's performance by examining the balance sheet, income statement, and cash flow statement. The analysis should identify key trends, profitability, liquidity, solvency, and cash flow generation patterns.

Running head: STRATEGIC FINANCIAL ANALYSIS
Strategic Financial Analysis
Name of the Student
Name of the University
Authors Note
Course ID

1STRATEGIC FINANCIAL ANALYSIS
Table of Contents
Introduction:...............................................................................................................................2
Critical review of Traditional Methods of Financial Analysis:.................................................2
Horizontal Analysis:...................................................................................................................2
Vertical analysis:........................................................................................................................4
Traditional Ratio analysis:.........................................................................................................4
Contemporary methods of financial analysis:............................................................................6
Capital asset Pricing Model:......................................................................................................6
Dividend Growth Model:...........................................................................................................7
Effective market hypothesis:......................................................................................................9
Conclusion:..............................................................................................................................11
Reference List:.........................................................................................................................12
Appendix:.................................................................................................................................15
Horizontal Analysis..................................................................................................................15
Wolseley:..................................................................................................................................15
Income Statement:....................................................................................................................15
Balance Sheet:..........................................................................................................................15
Cash Flow Statement:..............................................................................................................17
Rexam:.....................................................................................................................................18
Income Statement:....................................................................................................................18
Balance Sheet:..........................................................................................................................19

2STRATEGIC FINANCIAL ANALYSIS
Cash Flow Statement:..............................................................................................................20
Vertical Analysis:.....................................................................................................................21
Wolseley...................................................................................................................................21
Income Statement:....................................................................................................................21
Balance Sheet:..........................................................................................................................21
Cash Flow Statement:..............................................................................................................23
Rexam:.....................................................................................................................................23
Income Statement:....................................................................................................................23
Balance Sheet:..........................................................................................................................24
Cash Flow Statements:.............................................................................................................25

3STRATEGIC FINANCIAL ANALYSIS
Introduction:
The current report is based on the critical analysis of the different tradition and
modern methods involved in the determining the financial and operating position of an
organization. Several financial analysis tools has been proposed and examined by the
researchers from the last decades. Most notably and widely acknowledged is the vertical and
horizontal method of analysis the financial position of the organization. Following the
vertical and horizontal mode of analysis the financial position of an organization there is also
another tool of analysing the financial position of the organizations is the ratio analysis
(Grant 2016). Ratio analysis is regarded as the core of the financial analysis because of its
ability of covering large range of financial aspects of the company by addressing the rotating
financial and operating activities of the organization.
The current report will be critically analysing the financial position of the Wolseley
and Rexam by employing the financial analysis tools of vertical horizontal and ratio analysis
to measure the operating performance of the organization. On the other hand, other methods
such as Capital asset pricing model, dividend growth model and effective market hypothesis
will be performed as well. The analysis will cover the description of the models and will
address the limitations surrounding the model. Finally, a comprehensive conclusion will be
presented stating the best available tool of analysing the financial performance of
organizations.
Critical review of Traditional Methods of Financial Analysis:
Horizontal Analysis:
The most commonly used methods of analysis is the horizontal analysis. These are the
statements, which shows the profitability and the financial position of the organization for a
different period under the comparative form in order to give an idea regarding the financial

4STRATEGIC FINANCIAL ANALYSIS
position of two or more periods. It is generally applicable to two most important financial
statements particularly the balance sheet and the statement of profit and loss in a comparative
method (Wahlen, Baginski and Bradshaw 2014). The financial data will be comparative
under the circumstances when the identical principles of accounting is used in preparing the
statements. If this is not the situation, changes in the use of the methods of accounting
principles must be mentioned in the footnotes.
As derived from the financial computation a somewhat tumultuous trends is found by
having an in depth analysis for the Wolseley with the falling trend in the sales as the
company suffered a falling trend of sales in the financial year of 2012 and 2013. However, in
the following years of 2015 and 2016 the sales revenue increased for the Wolseley. On the
other hand Rexam reported a blend in their trend of sales as reported by the company during
the financial year. The revenue reported by the company experienced a rising trend of 1.89%
during the year 2011-12 however in the following years of 2012-13 since the revenue
declined by 8.56% which further declined in the subsequent years of 2014-15 by 2.82%. The
trend represented a declining terms of the revenue derivation, which slightly aided in the year
of 2015 with a slight increase of 2.43 for Rexam. Therefore, horizontal analysis is beneficial
for the readers since it provides them with the benefits of examining and comparing the
position of the organization over the years.
However, horizontal analysis suffers from criticism since it suffers from the
shortcoming that the aggregate of the information that is stated in the financial statements
may be changed over the period (Weygandt, Kimmel and Kieso 2015). This is because of the
ongoing changes in the accounts might shift amid different accounts and therefore it causes
variances at the time of comparing the balance of the accounts from one period to another
period of accounting.

5STRATEGIC FINANCIAL ANALYSIS
Vertical analysis:
There are certain statements that reflects the association of different items on the
financial statement with common items by stating each item as the percentage of the common
item. Vertical analysis can be defined as the proportional analysis of the financial statements
where each line of items of the financial statements is recorded as the percentage of the other
item (Carmona 2014). Typically, this represents that the each line of the item in the income
statement is the percentage of gross sale while every line of item of on the balance sheet is
stated as the percentage of the total sales (Vogel 2014). Considering the horizontal analysis
performed for the companies it can be stated that Rexam reported a profit from the business
operations of 8.88% and 5.58% respectively for the financial year of 2011-2012 respectively.
A declining trend in the profit was noticed in the subsequent year of 2013 with Rexam
reporting a profit of 2.38%. On the other hand the profit reported by the Wolseley for the year
2013-14 stood 2.25% and 4.11% respectively. However in the following year of 2015 and
2016 the profit attributed to the shareholder stood 1.60% and 4.57% respectively.
While considering the other side of analysis Vertical analysis is entitled to the certain
limitations. According to Edmonds et al. (2013), criticizes the technique since it does not
addresses the significant changes in the degree of inflationary effect. Therefore, the results of
the inputs can be misleading because the information is largely reliant on the historical cost.
Additionally the analysis does not considers the qualitative aspects at the time of evaluating
the performance such as quality of the work, relation with stakeholders etc. Additionally, it is
restricted to liquidity aspects of the analysis and ignores the current ratio and debt ratio,
which holds the entitlement of computing the liquidity and solvency.
Traditional Ratio analysis:
Ratio analysis is considered as the most widely used and appreciated method of
comparing in respect of the financial and operating performance. In the words of Valickova,

6STRATEGIC FINANCIAL ANALYSIS
Havranek and Horvath (2015), have stated their opinion that ratio analysis determining the
efficiencies of the organization in respect of the financial and operating performance. The
ratio analysis helps the managers to identify the degree of efficiency in respect of deriving
profits from the assets employed. As represented in table below;
Year 2012 2013 2014 2015 2016
Wolseley Fixed asset turnover % 4.86 4.59 4.31 5.21 4.94
Rexam fixed asset turnover % 0.94 1.08 1.21 1.17 1.11
As evident from the above stated ratio trend it provides the reader with the in depth
vision of the fixed asset turnover for both Wolseley and Rexam. An assertion can be bought
forward in this context by stating that Wolseley has reported a higher return on assets that its
counterpart Rexam with the trend over the period of five year has reflected a rising trend
while Rexam reported a somewhat tumultuous return. Rexam has experienced an unstable
trend of return on asset deployed by the company a notable trend of decline has been
witnessed during 2012-13 while it regained in the following year of 2015 to 1.21 however in
the later years the return again take a downward dive. Therefore, it can be stated that the ratio
analysis is considered an effective tool when there is a situation of comparing the financial
performance of two companies.
Additionally, ratio analysis is considered as the effective means of identifying the
shortcoming in the performance of the companies operations in spite of the fact the overall
performance of the company is better (Edmonds et al. 2016). The statistics gained that is
gained by the management from the ratio analysis helps in formulation of plans by analysing
the past performance and develop an effective plan to overcome the weakness in foreseeable
time.
2012 2013 2014 2015 2016
Current Ratio of Wolseley 1.69 1.51 1.49 1.38 1.46

7STRATEGIC FINANCIAL ANALYSIS
Current Ratio of Rexam 1.56 1.17 1.11 1.13 0.98
By noticing the trend above, it provides the reader with the analysis of the liquidity
position of both Wolseley and Rexam in terms of the current ratio reported by the company.
considering into the scenario of the Wolseley the company posted a strong liquidity position
as it reported a better current ratio over the period of five years (Mayes 2014). Rexam, on the
other side reported a declining trend of current ratio with overall span of slight increase in
2014. Thereby, it can be concluded by stating the recognition of liquidity by the management
of Wolseley and Rexam with sufficient strategies must be aligned to overcome the
shortcomings.
Contemporary methods of financial analysis:
Capital asset Pricing Model:
The capital asset pricing model is based on the specific assumptions where some of
which is common to CAPM and MPT. The model has been widely appreciated for its
capability of calculating the risk efficiently. According to Barberis et al. (2015), considers
CAPM as the tool of systematic risk for the investors to diversify their portfolio for
eliminating the haphazard risk. Additionally, it was also reinforced in comparing the
perspective since CAPM considers the company comparing itself throughout the market. The
investors under the CAPM model aims at maximising the utility of their wealth. The main
difference between them is that individual prefer taking into the considerations the account of
utility concept.
Whereas as some have preference for large amount of risk that will have increasing
marginal utility or wealth. Others will have less preference for their risk in the incremental
wealth will be considered to be less attractive if it is attached with more risk (Habibi et al.

8STRATEGIC FINANCIAL ANALYSIS
2016). The technique of CAPM is considered as the better technique for the investors to use
the tool for investment appraisal because it provides appropriate link with the required rate of
return and systematic risk. The contemporary procedure of CAPM overcomes the
shortcomings of the other traditional methods by addressing risk by facilitating comparison of
the performance that is ignored by the traditional methods.
Investors have identical anticipations of Risk and return therefore without such
consensus standards the estimates related to mean variance might result in different forecast
with the result that the critical portfolio of each will be not be similar from that of the others
(Golez 2014). Given that the investors does not have identical anticipations there will be no
homogeneity in their conception and solitary efficient frontier would be applicable to all. The
assumptions of the CAPM represents that the market equilibrium and the anticipated rate of
return is equivalent to the required rate of return for the given degree of risk. CAPM offers a
liner association amid the required rate of return and it is associated to the market risk or Beta
that cannot be avoided.
The model of CAPM is not considered to be realistic since it assumes that all the
investors are averse to risk and with higher risk the return is higher. In spite of getting
widespread support, the model of CAPM suffers from certain limitations and shortcomings
(Bodie, Kane and Marcus 2014). At first CAPM is largely based on the assumptions that have
bought forward the questions based on the actuality of the model since the prevalence of the
perfect market is absence from the pricing of the model. In addition to this, borrowing from
the investors is not performed at the risk free rate and this represents that the actual security
market line will be steeper. Finally, in terms of the competition with the CAPM, investment
appraisal provides bigger perception on the investments returns whereas the model of CAPM
restricts the span to short and singular period.

9STRATEGIC FINANCIAL ANALYSIS
Dividend Growth Model:
The Gordon’s dividend growth model is considered as one of the most popular model
in finance to make use value in order to evaluate the fundamental values of the stocks. The
dividend discount model assumes that the value is a direct function of the cash flow
anticipated in the future (Asimakopoulos et al. 2016). Under the circumstances of the
common stock, the relevant cash flows is the dividends that is paid along with the value of
the stock when it is sold. The price or the value of the share is that is derived from the future
stream of dividends is considered to be the intrinsic value of the stock. By assuming that the
dividends are paid out at the end of every year, the investors can estimate the fair price of the
stock to hold for the period of three years.
According to Belo et al. (2015), the advantage of dividend growth model lies in its
consistency since dividend generally stays for a longer period as compared to the other
components like earnings. Hamid et al. (2017), also supports the model for their wide range
of coverage that considers the minority shareholders. An important consideration in this
regard can be bought forward that dividend growth model is the efficient model in respect to
other traditional analysis since it enables the companies to compare companies of different
industries and market conditions that is primarily limitations to the ratio analysis.
The dividend growth model offers a wide mean of developing the explicit returns
together for the individual stocks and the aggregate market (Jordan 2014). The model
essentially contributes in the appraisal of the relative attractiveness of the individual stocks
together with the evaluation of the attractiveness of the stock market in the entire asset
allocation settings. In addition to this, the dividend growth model provides the usefulness in
understanding the factors of risk such as variation in interest rate with changing inflation rate
create an impact on the stocks.

10STRATEGIC FINANCIAL ANALYSIS
In spite of the success of the model, dividend growth model possesses certain
limitations as well. In the words of Lundholm and Sloan (2013), the mode is reliant heavily
on the inputs since a small change in the required rate of return or a continuous growth might
result in huge change in the terminal value along with the value of the stock. The model has
been additionally criticized for assuming that the growth rate is constant that makes the
dividend of the company appear liner whereas the empirical evidences represents that the
dividend growth is found to be seldom liner which ultimate makes the validity of the model
under query. The model does not assume non-dividend factors such as brand loyalty,
retention of customers and ownership of the intangible assets which increases the value of the
company. The model assumes that the stock price of the company is hypersensitive to the
dividend growth rate selected and the growth rate cannot go past the cost of equity and this
generally does not happen.
Effective market hypothesis:
The effective market hypothesis is regarded as the proposition where present prices of
stock clearly reflects the information that is available regarding the value of the organization
with no other means of earning excess amount of profit (Frahm 2014). The effective market
hypothesis is concerned with the most fundamental and exciting issues in finance by
addressing the reasons behind the change in the price and methods involved in changes in
price in security market. The effective market hypothesis holds important implications for the
investors along with the managers that the traditional method of analysis.
Several investors make an attempt to recognize the securities, which is undervalued,
and are anticipated to increase the value in upcoming time and especially those that would
increase more than others would (Weygandt, Kimmel and Kieso 2015). Several investors
along with investment managers considers that they can select securities, which would

11STRATEGIC FINANCIAL ANALYSIS
outperform in market. They make use of the several types of valuation and forecasting
techniques to assist them in their investment decision.
Most arguably, none of the economics theory or financial theory have produced more
passionate discussion surrounding its challenges and proponent. As stated by Narayan et al.
(2015), there is no proposition in the economics that possess more solid empirical evidence
supporting the efficient market hypothesis. An important consideration to denote that
effective market hypothesis suggest that profiting by predicting the price movements is
cumbersome and unlikely prospect. The main engine behind the price changes is the influx of
the new evidence. A market is considered to be efficient if the price adjust quickly and on
average without being bias to the new information (Jovanovic, Andreadakis and Schinckus
2016). Consequently, the present price of the securities reflects all the available information
during any given period. Because of this, there is hardly any reason to believe that the prices
are very high or low. The price of the securities adjust before an investor has the time to
adjust to the trade and profit the new section of information.
One of the prime reason for the prevalence of the effective market hypothesis is the
high degree of competition amid the investors to profit from the new information. The ability
of identifying the over and under priced stocks is considered to be very valuable as it enables
the investors to purchase some stocks in less than the true value and selling those stocks to
others at a higher value (Baltes, Dragoe and Ardelean 2015). In natural terms as more number
of investors compete against each other with the effort of taking advantage of over and
undervalued securities with the probability of being able to identify the exploit such miss-
priced securities becomes relatively small. An important considerations under the Effective
market hypothesis is that at any situation of time prices of the securities provides an all
known information that is available to the investors. There is hardly any means of deceiving

12STRATEGIC FINANCIAL ANALYSIS
investors and because of this all the investments under the efficient market is priced fairly. In
other words, investors get just what they pay for.
Conclusion:
On succeeding review of the literature a conclusion can be drawn by stating that
tradition tool of financial analysis namely, vertical horizontal and ratio analysis possess
certain kinds of limitations, which makes these analysis almost insufficient to use. On the
other hand, the capital asset pricing model has responded to the criticism by providing a
appropriate computation of the risk involved in investment.
As it is understood that systematic risk has been ignored by other methods of analysis
CAPM is regarded as one of the better tool of diversifying the risk involved in portfolio. An
important consideration can be draw in this context is that even though the model has been
subject to some criticism in the recent years because of the multifaceted business
environment the model of CAPM yet remains one of the useful mode of analysis until
something better is presented to diversify the risk for the investors involved in investment.

13STRATEGIC FINANCIAL ANALYSIS
Reference List:
Asimakopoulos, P., Asimakopoulos, S., Kourogenis, N. and Tsiritakis, E., 2017. Time-
Disaggregated Dividend–Price Ratio and Dividend Growth Predictability in Large Equity
Markets. Journal of Financial and Quantitative Analysis, 52(5), pp.2305-2326.
Baltes, N., Dragoe, A.G.M. and Ardelean, D.I., 2015. Study regarding the assets evaluation
on the financial market through the CAPM model. Studia Universitatis Vasile Goldis Arad,
Seria Stiinte Economice, 24(3), pp.78-87.
Barberis, N., Greenwood, R., Jin, L. and Shleifer, A., 2015. X-CAPM: An extrapolative
capital asset pricing model. Journal of Financial Economics, 115(1), pp.1-24.
Belo, F., COLLIN‐DUFRESNE, P.I.E.R.R.E. and Goldstein, R.S., 2015. Dividend dynamics
and the term structure of dividend strips. The Journal of Finance, 70(3), pp.1115-1160.
Bodie, Z., Kane, A. and Marcus, A.J., 2014. Investments, 10e. McGraw-Hill Education.
Carmona, R., 2014. Statistical analysis of financial data in R(Vol. 2). New York: Springer.
Edmonds, T.P., Edmonds, C.D., Tsay, B.Y. and Olds, P.R., 2016. Fundamental managerial
accounting concepts. McGraw-Hill Education.
Edmonds, T.P., McNair, F.M., Olds, P.R. and Milam, E.E., 2013. Fundamental financial
accounting concepts. New York, NY: McGraw-Hill Irwin.
Frahm, G., 2014. A Modern Approach to the Efficient-Market Hypothesis (No. 1302.3001).
Golez, B., 2014. Expected returns and dividend growth rates implied by derivative
markets. The Review of Financial Studies, 27(3), pp.790-822.
Grant, R.M., 2016. Contemporary Strategy Analysis Text Only. John Wiley & Sons.

14STRATEGIC FINANCIAL ANALYSIS
Habibi, H., Habibi, R. and Habibi, H., 2016. Derivation of Kalman Filter Estimates Using
Bayesian Theory: Application in Time Varying Beta CAPM Model. Journal of Statistical
and Econometric Methods, 5(2), pp.1-16.
Hamid, K., Suleman, M.T., Ali Shah, S.Z., Akash, I. and Shahid, R., 2017. Testing the weak
form of efficient market hypothesis: Empirical evidence from Asia-Pacific markets.
Jordan, B., 2014. Fundamentals of investments. McGraw-Hill Higher Education.
Jovanovic, F., Andreadakis, S. and Schinckus, C., 2016. Efficient market hypothesis and
fraud on the market theory a new perspective for class actions. Research in International
Business and Finance, 38, pp.177-190.
Lundholm, R.J. and Sloan, R.G., 2013. Equity valuation and analysis with eVal. McGraw-
Hill Irwin.
Mayes, T.R., 2014. Financial Analysis with Microsoft Excel. Nelson Education.
Narayan, P.K., Narayan, S., Popp, S. and Ali Ahmed, H., 2015. Is the efficient market
hypothesis day-of-the-week dependent? Evidence from the banking sector. Applied
Economics, 47(23), pp.2359-2378.
Valickova, P., Havranek, T. and Horvath, R., 2015. Financial development and economic
growth: A meta‐analysis. Journal of Economic Surveys, 29(3), pp.506-526.
Vogel, H.L., 2014. Entertainment industry economics: A guide for financial analysis.
Cambridge University Press.
Wahlen, J., Baginski, S. and Bradshaw, M., 2014. Financial reporting, financial statement
analysis and valuation. Nelson Education.

15STRATEGIC FINANCIAL ANALYSIS
Warren, C.S., Reeve, J.M. and Duchac, J., 2013. Financial & managerial accounting.
Cengage Learning.
Weygandt, J.J., Kimmel, P.D. and Kieso, D.E., 2015. Financial & Managerial Accounting.
John Wiley & Sons.
Weygandt, J.J., Kimmel, P.D. and Kieso, D.E., 2015. Financial & Managerial Accounting.
John Wiley & Sons.

16STRATEGIC FINANCIAL ANALYSIS
Appendix:
Horizontal Analysis
Wolseley:
Income Statement:
Wolseley 2012 2013 2014 2015 2016
Income Statement
Revenue 100% -2% -7% 9% 8%
Cost of sales 100% -2% -7% 8% 8%
Gross profit 100% -1% 0% 0% 0%
Operating costs
Total operating costs 100% -9% -14% 17% 4%
Operating profit 100% 134% 42% -21% 38%
Finance income 100% 50% -67% 0% -100%
Finance costs 100% 22% 0% 0% 0%
Profit on disposal of associate 100% -100%
Profit before tax 100% 132% 47% -25% 43%
Taxation 100% 28% 10% -4% 24%
Profit from continuing operations 100% 373% 70% -33% 55%
Profit/(loss) from discontinued operations 100% -500% 83% -591% -243%
Profit for the year
Attributable to
Shareholders of the Company 100% 419% 70% -58% 209%
Non-controlling interests 100% 0% 0% 0% 0%
Balance Sheet:
Wolseley 2012 2013 2014 2015 2016
Balance Sheet
Assets
Non-current assets
Intangible assets: goodwill 100% 10.70% -4.20% -10.53% 10.54%
Intangible assets: other 100% -2.00% -2.72% -31.82% 3.59%
Property, plant and equipment 100% 5.69% -2.93% -5.06% 23.20%
Financial assets: available-for-sale
investments 100% 0.00% 0.00% 0.00% 0.00%
Retirement benefit assets 100% 0.00% 0.00% 0.00% 0.00%
Deferred tax assets 100% -
22.17%
-
24.68
% -3.36% 10.43%

17STRATEGIC FINANCIAL ANALYSIS
Other receivables 100% 6.25% 5.88% 6.17% 23.26%
Derivative financial assets 100% -
20.69%
-
32.61
% -22.58%
-
16.67%
Total non-current assets 100% 3.80% -0.66% 0.00% 0.00%
current assets 100%
Inventories 100% 7.22% -4.88% 0.00% 0.00%
Trade receivables 100% 7.79% -6.14% 0.00% 0.00%
Other receivables 100% 11.34% 11.55
% -22.30% 14.06%
Current tax receivable 100% -
50.00%
60.00
% -75.00%
-
100.00
%
Derivative financial assets 100% 14.29%
-
31.25
% -9.09% 10.00%
Financial receivables: construction
loans (secured) 100%
-
100.00
%
Cash and cash equivalents 100% 0.00%
-
29.20
% 360.42%
-
14.93%
Total current assets 100% 0.00% -6.09% 22.02% 9.59%
Assets held for sale 100% 23.26%
-
45.28
% 593.10%
-
72.14%
Total assets 100% -1.37% -4.17% 10.88% 8.94%
Liabilities and equity 100% 0.00% 0.00% 0.00%
Liabilities 100% 0.00% 0.00% 0.00%
Current liabilities 100% 0.00% 0.00% 0.00%
Trade payables 100% 11.87% -5.93% 4.75% 15.97%
Other payables 100% 1.55%
-
13.20
% -11.89% 13.50%
Current tax payable 100% -
31.63% 2.99% -15.94% 74.14%
Bank loans and overdrafts 100% -
52.83%
218.00
% 529.56%
-
29.97%
Obligations under finance leases 100% 30.00%
-
46.15
% -42.86% 0.00%
Derivative financial liabilities 100% - 0.00%
-
100.00
%
Provisions 100% 50.00%
-
20.33
% -20.41% 12.82%
Retirement benefit obligations 100% 0.00% -
72.41
0.00% 12.50%

18STRATEGIC FINANCIAL ANALYSIS
%
Total current liabilities 100% 6.35% -4.73% 31.96% 3.09%
Non-current liabilities 100% 0.00% - -
Other payables 100% 35.53% 7.77% 12.61% 30.40%
Bank loans 100% 3.52% 12.20
% 15.42% 28.70%
Obligations under finance leases 100% 2.33%
-
18.18
% -30.56% 8.00%
Deferred tax liabilities 100% 1.43%
-
34.51
% -43.01% 22.64%
Provisions 100% -8.70% 1.36% -14.09% 3.91%
Retirement benefit obligations 100% -
68.39%
-
22.12
% -20.99%
115.63
%
Total non-current liabilities 100% -
12.94% 1.29% 3.73% 30.05%
Liabilities held for sale 100% 36.36%
-
93.33
%
13500.00
%
-
91.18%
Total liabilities 100% -0.45% -3.18% 26.23% 7.69%
Equity attributable to shareholders of
the Company 100% 0.00% - -
Share capital 100% 0.00% 3.57% 0.00% 0.00%
Share premium account 100% 42.11% 51.85
% 2.44% 0.00%
Reserves 100% -2.85% -6.07% -10.19% 11.98%
Shareholders’ equity 100% -2.55% -5.47% -9.91% 11.65%
Non-controlling interest 100% - 0.00%
-
-
128.57
%
Total equity 100% -2.55% -5.47% -9.67% 11.28%
Total liabilities and stockholders' equity 100% -1.37% -4.17% 10.88% 8.94%
Cash Flow Statement:
Consolidated cash flow statement Wolseley
2012 2013 2014 2015 2016
Cash generated from operating activities 100% -36% 9% 15% 15%
Net cash outflow/inflow from investing
activities 100%
-
247% 57% 6% 6%
Net cash outflow from financing activities 100% 155%
-
62%
104
%
104
%
Net cash (used)/generated 100% -
188%
-
73%
-
116
-
116

19STRATEGIC FINANCIAL ANALYSIS
% %
Cash transferred to disposal groups held for
sale 100%
-
100% 0% 0% 0%
Effects of exchange rate changes 100% -73% 30%
-
123
%
-
123
%
Net (decrease)/increase in cash, cash
equivalents and bank overdrafts 100%
-
207%
-
71%
-
109
%
-
109
%
Cash and cash equivalents at the start of the
period 100% 133%
-
61% 53% 53%
Cash and cash equivalents at the end of the
period 100% -61%
-
45% -3% -3%
Rexam:
Income Statement:
Rexam 2011 2012 2013 2014 2015
Income Statement
Sales 100%
1.89
% -8.56% -2.82% 2.43%
Cost of sales 100%
1.13
% -6.08% -3.32% 5.37%
Gross profit 100%
2.95
%
-
11.98
% -2.07% -1.86%
Operating expenses 100%
0.00
% 0.00% 0.00% 0.00%
Total operating expenses 100%
5.38
%
-
12.87
% -1.53% 7.07%
Operating profit 100%
-
3.56
% -9.35% -3.60%
-
27.61%
Share of post tax profits of associates and
joint ventures 100%
0.00
% 0.00% 11.11% 30.00%
Retirement benefit obligations net finance
cost 100%
-
12.50
%
14.29
% 0.00%
-
25.00%
Profit before interest and income taxes 100%
-
3.19
% -9.89% -3.41%
-
26.26%
Interest expense 100%
45.33
%
-
29.36
% -22.08%
-
16.67%

20STRATEGIC FINANCIAL ANALYSIS
Interest income 100%
14.29
%
-
25.00
% 16.67% 14.29%
Profit before tax 100%
-
11.94
% -4.24% 1.18%
-
27.11%
Tax 100%
-
20.35
% -4.44% -11.63%
-
14.47%
Profit for the financial year from
continuing operations 100%
-
8.65
% -4.17% 5.53%
-
30.71%
Loss)/profit for the financial year from
discontinued operations 100%
-
157.4
7%
216.00
%
-
156.96%
-
100.00
%
Total profit for the financial year
attributable to equity shareholders of
Rexam PLC 100%
-
43.09
%
-
55.61
% 275.79%
-
48.18%
Balance Sheet:
Rexam 2011 2012 2013 2014 2015
Balance Sheet
Assets
Non-current assets
Goodwill
100
% -15.32% -20.67% -1.14% 1.40%
Other intangible assets
100
% -24.20% -86.92% -23.53%
280.77
%
Property, plant and equipment
100
% -8.24% -13.85% 1.43% 12.63%
Investments in associates and joint
ventures
100
% -2.86% 11.76% 5.26% 10.00%
Pension assets
100
% 0.00% 0.00% 13.48%
Insurance backed assets
100
% 0.00% -13.04% 15.00% 0.00%
Deferred tax assets
100
% -0.68% -7.53% -22.22% 15.71%
Trade and other receivables
100
% 3.77% 42.73% 12.74% 8.47%
Available for sale financial assets
100
% 0.00% -100.00%
Derivatives financial instruments
100
% 0.00% 0.00% 0.00% 0.00%
Total non-current assets 100 -11.64% -18.45% 0.12% 8.39%

21STRATEGIC FINANCIAL ANALYSIS
%
current assets
100
% 0.00% 0.00% 0.00% 0.00%
Inventories
100
% 0.00% 0.00% 0.00% 0.00%
Insurance backed assets
100
% 0.00% 0.00% 0.00% 0.00%
Trade receivables
100
% -14.86% -12.24% 1.03% -3.84%
Other receivables
100
% 16.67% -26.98% 7.61% 25.25%
Available for sale financial assets
100
% 0.00% 0.00% 0.00% 0.00%
Derivatives financial assets
100
% 0.00% 0.00% 0.00% 0.00%
Cash and cash equivalents
100
% 217.23% -83.86% 36.49% -17.71%
Total current assets
100
% 47.93% -49.81% 11.56% -0.61%
Assets classified as held for sale
100
% 50.00%
23000.00
%
-
100.00
%
Total assets
100
% 3.90% -19.24% -10.74% 5.80%
Liabilities and equity
100
% 0.00% 0.00% 0.00% 0.00%
Liabilities
100
%
Current liabilities
100
% 0.00% 0.00% 0.00% 0.00%
Borrowings
100
%
1986.79
% -72.97% -2.34% 28.77%
Derivatives financial instruments
100
% -58.73% 50.00% 7.69% 30.95%
Current tax
100
% -30.77% -66.67%
233.33
% 60.00%
Trade payables
100
% -7.06% -3.59% 23.41% 7.80%
Other payables
100
% 2.56% -31.94% -1.22% 6.20%
Provisions
100
% 27.78% -39.13% -35.71% 94.44%
Total current liabilities
100
% 96.98% -47.01% 9.06% 15.33%
Liabilities classified as held for sale
100
%
-
100.00
%
Non-current liabilities
100
%

22STRATEGIC FINANCIAL ANALYSIS
Borrowings
100
% -38.04% 6.78% -4.83% -1.42%
Derivatives financial instruments
100
% -18.78% -3.40% 13.38% 18.63%
Retirement benefits obligations
100
% -4.44% -19.19% 15.59% 6.85%
Deferred tax liabilities
100
% -6.35% -8.47% -25.93% 50.00%
Non-current tax
100
% -2.30% -8.24% -29.49% -5.45%
Other payables
100
% -3.77% 74.51% -28.09% -25.00%
Provisions
100
% 30.00% -14.29% 1.28% -16.46%
Total non-current liabilities
100
% -26.05% -0.78% -1.67% 1.75%
Total liabilities
100
% 7.12% -19.77% -2.97% 6.74%
Stockholders' equity
100
%
Ordinary share capital
100
% 0.18% 0.18% 0.18% 0.00%
Non equity B shares
100
%
-
100.00
%
Share premium account
100
% 0.30% -39.31% -29.57% 0.24%
Capital redemption reserve
100
% 0.00% 112.54% 23.99% 0.11%
Retained earnings (Loss)
100
% 35.55% -134.97%
192.00
% -18.84%
Other reserves
100
% -54.41% -40.86%
-
483.64
% 30.81%
Shareholders’ equity
100
% -1.38% -18.28% -24.34% -0.64%
Non-controlling interests
100
%
Total equity
100
% -1.38% -18.28% -24.34% 3.68%
Total liabilities and stockholders'
equity
100
% 3.90% -19.24% -10.74% 5.80%
Cash Flow Statement:
Consolidated cash flow statement
Rexam

23STRATEGIC FINANCIAL ANALYSIS
Particulars 2011 2012 2013 2014 2015
Cash generated from operating
activities 100% -0.63% -12.98%
-
11.74% -12.19%
Net cash outflow from investing
activities 100%
-
550.00%
-
342.59%
-
195.04
%
-
222.89
%
Net cash outflow from financing
activities 100%
-
293.29%
-
524.31%
-
56.96% -85.17%
Net increase/(decrease) in cash and
cash equivalents 100% 188.67%
-
224.13%
-
107.81
%
-
179.76
%
Cash and cash equivalents at the start
of the period 100% 306.06% 210.70%
-
84.71% 41.88%
Exchange differences and other
adjustments 100%
-
733.33%
-
189.47%
-
123.53
%
250.00
%
Cash and cash equivalents at the end
of the period 100% 210.70% -84.71% 41.88% -29.89%
Vertical Analysis:
Wolseley
Income Statement:
2012 2013 2014 2015 2016
Revenue 100% 100% 100% 100% 100%
Cost of sales 72% 72.22% 72.23% 72.04% 71.73%
Gross profit 28% 27.78% 27.77% 27.96% 28.27%
Operating costs 0.00% 0.00% 0.00% 0.00% 0.00%
Total operating costs 25.97% 24.01% 22.03% 23.79% 22.95%
Operating profit 1.58% 3.77% 5.75% 4.17% 5.32%
Finance income 0.01% 0.02% 0.01% 0.01% 0.00%
Finance costs 0.24% 0.30% 0.24% 0.37% 0.28%
Profit on disposal of associate 0.12% 0.00% 0.00% 0.00% 0.00%
Profit before tax 1.48% 3.50% 5.51% 3.81% 5.04%
Taxation 1.03% 1.34% 1.58% 1.40% 1.60%
Profit from continuing operations 0.45% 2.16% 3.93% 2.41% 3.44%
Profit/(loss) from discontinued operations 0.02% 0.09% 0.18% 0.81% 1.07%
Profit for the year 0.42% 2.25% 4.11% 1.60% 4.50%
Attributable to 0.00% 0.00% 0.00% 0.00% 0.00%
Shareholders of the Company 0.42% 2.25% 4.11% 1.60% 4.57%
Non-controlling interests 0.00% 0.00% 0.00% 0.00% 0.06%

24STRATEGIC FINANCIAL ANALYSIS
Balance Sheet:
Balance Sheet Wolseley 2012 2013 2014 2015 2016
Assets
Non-current assets
Intangible assets: goodwill 12.04% 13.52% 13.52% 10.91% 11.07%
Intangible assets: other 4.20% 4.17% 4.24% 2.61% 2.48%
Property, plant and equipment 16.74% 17.94% 18.17% 15.56% 17.59%
Financial assets: available-for-sale investments 0.04% 0.03% 0.25% 0.21% 0.28%
Retirement benefit assets 0.00% 0.00% 1.42% 0.76% 0.00%
Deferred tax assets 2.84% 2.24% 1.76% 1.54% 1.56%
Other receivables 2.02% 2.17% 2.40% 2.30% 2.60%
Derivative financial assets 0.81% 0.65% 0.46% 0.32% 0.25%
Total non-current assets 38.70% 40.73% 42.22% 34.20% 35.82%
current assets
Inventories 22.49% 24.45% 24.27% 22.56% 24.75%
Trade receivables 22.65% 24.75% 24.24% 22.00% 23.24%
Other receivables 3.61% 4.13% 4.88% 3.60% 3.84%
Current tax receivable 0.28% 0.14% 0.24% 0.05% 0.00%
Derivative financial assets 0.20% 0.23% 0.16% 0.13% 0.13%
Financial receivables: construction loans
(secured) 0.08% 0.00% 0.00% 0.00% 0.00%
Cash and cash equivalents 11.39% 4.81% 3.56% 14.77% 11.53%
Total current assets 60.70% 58.52% 57.35% 63.11% 63.49%
Assets held for sale 0.60% 0.75% 0.43% 2.69% 0.69%
Total assets
100.00
%
100.00
%
100.00
%
100.00
%
100.00
%
Liabilities and equity
Liabilities
Current liabilities
Trade payables 23.24% 26.36% 25.87% 24.45% 26.02%
Other payables 8.15% 8.39% 7.60% 6.04% 6.29%
Current tax payable 1.37% 0.95% 1.02% 0.78% 1.24%
Bank loans and overdrafts 1.48% 0.71% 2.36% 13.38% 8.60%
Obligations under finance leases 0.14% 0.18% 0.10% 0.05% 0.05%
Derivative financial liabilities 0.00% 0.00% 0.00% 0.01% 0.00%
Provisions 1.15% 1.75% 1.45% 1.04% 1.08%
Retirement benefit obligations 0.41% 0.41% 0.12% 0.11% 0.11%
Total current liabilities 35.94% 38.75% 38.53% 45.86% 43.39%
Non-current liabilities
Other payables 1.06% 1.46% 1.64% 1.67% 2.00%
Bank loans 9.54% 10.01% 11.72% 12.20% 14.42%
Obligations under finance leases 0.60% 0.62% 0.53% 0.33% 0.33%
Deferred tax liabilities 1.96% 2.02% 1.38% 0.71% 0.80%

25STRATEGIC FINANCIAL ANALYSIS
Provisions 2.25% 2.09% 2.21% 1.71% 1.63%
Retirement benefit obligations 4.61% 1.48% 1.20% 0.86% 1.69%
Total non-current liabilities 20.03% 17.68% 18.69% 17.48% 20.87%
Liabilities held for sale 0.15% 0.21% 0.01% 1.82% 0.15%
Total liabilities 56.12% 56.65% 57.23% 65.16% 64.41%
Equity attributable to shareholders of the
Company
Share capital 0.39% 0.40% 0.43% 0.39% 0.36%
Share premium account 0.27% 0.38% 0.61% 0.56% 0.52%
Reserves 43.22% 42.57% 41.73% 33.80% 34.74%
Shareholders’ equity 43.88% 43.35% 42.77% 34.75% 35.62%
Non-controlling interest 0.09%
Total equity 43.88% 43.35% 42.77% 34.84% 35.59%
Total liabilities and stockholders' equity
100.00
%
100.00
%
100.00
%
100.00
%
100.00
%
Cash Flow Statement:
Consolidated cash flow statement
Wolseley 2012 2013 2014 2015 2016
Cash generated from operating activities
100.00
% 100.00%
100.00
%
100.00
%
100.0
0%
Net cash outflow/inflow from investing
activities 21.96% 50.00%
71.68
%
36.55
%
33.80
%
Net cash outflow from financing activities 40.81% 161.35%
55.53
%
39.18
%
69.50
%
Net cash (used)/generated 81.15% 111.35%
27.21
%
24.27
% 3.30%
Cash transferred to disposal groups held for sale 6.54% 0.00% 0.00% 0.00% 0.00%
Effects of exchange rate changes 5.76% 2.42% 2.88%
11.26
% 2.29%
Net (decrease)/increase in cash, cash equivalents
and bank overdrafts 68.85% 113.77%
30.09
%
13.01
% 1.02%
Cash and cash equivalents at the start of the
period 51.71% 186.96%
67.04
%
37.43
%
32.53
%
Cash and cash equivalents at the end of the
period
120.56
% 73.19%
36.95
%
36.26
%
31.51
%
Rexam:
Income Statement:
2011 2012 2013 2014 2015

26STRATEGIC FINANCIAL ANALYSIS
Sales
100.00
%
100.00
%
100.00
%
100.00
%
100.00
%
Cost of sales 58.41% 65.24% 61.27% 59.24% 62.42%
Gross profit 41.59% 47.29% 41.62% 40.76% 40.01%
Operating expenses 0.00% 0.00% 0.00% 0.00% 0.00%
Total operating expenses 30.32% 0.00% 0.00% 0.00% 0.00%
Operating profit 11.27% 12.00% 10.88% 10.49% 7.59%
Share of post tax profits of associates and
joint ventures 0.21% 0.23% 0.23% 0.26% 0.34%
Retirement benefit obligations net finance
cost 0.38% 0.37% 0.42% 0.42% 0.31%
Profit before interest and income taxes 0.00% 11.87% 10.70% 10.33% 7.62%
Interest expense 1.77% 2.84% 2.01% 1.57% 1.30%
Interest income 0.17% 0.21% 0.16% 0.18% 0.21%
Profit before tax 9.50% 9.24% 8.85% 8.95% 6.52%
Tax 2.67% 2.35% 2.24% 1.98% 1.70%
Profit for the financial year from continuing
operations 6.83% 6.89% 6.60% 6.97% 4.83%
Loss)/profit for the financial year from
discontinued operations 0.00% 1.30% 4.12% 2.35% 0.00%
Total profit for the financial year
attributable to equity shareholders of Rexam
PLC 8.88% 5.58% 2.48% 9.32% 4.83%
Balance Sheet:
Balance Sheet Rexam 2011 2012 2013 2014 2015
Assets
Non-current assets
Goodwill 29.95% 24.41% 23.97% 26.55% 25.45%
Other intangible assets 5.60% 4.09% 0.66% 0.57% 2.04%
Property, plant and equipment 25.96% 22.93% 24.46% 27.80% 29.59%
Investments in associates and joint
ventures 1.14% 1.07% 1.48% 1.74% 1.81%
Pension assets 0.00% 0.00% 0.00% 1.94% 2.08%
Insurance backed assets 0.38% 0.36% 0.39% 0.50% 0.47%
Deferred tax assets 4.80% 4.59% 5.25% 4.58% 5.01%
Trade and other receivables 1.73% 1.73% 3.06% 3.86% 3.96%
Available for sale financial assets 0.02% 0.02% 0.00% 0.00% 0.00%
Derivatives financial instruments 4.33% 3.66% 4.18% 3.64% 2.51%
Total non-current assets 73.91% 62.85% 63.46% 71.18% 72.92%
current assets 0.00% 0.00% 0.00% 0.00% 0.00%
Inventories 8.44% 7.02% 9.07% 10.99% 11.09%
Insurance backed assets 0.03% 0.03% 0.04% 0.04% 0.04%
Trade receivables 8.46% 6.93% 7.53% 8.52% 7.75%

27STRATEGIC FINANCIAL ANALYSIS
Other receivables 1.76% 1.98% 1.79% 2.16% 2.56%
Available for sale financial assets 0.02% 0.00% 0.00% 0.00% 0.00%
Derivatives financial assets 0.62% 0.60% 0.53% 0.83% 0.76%
Cash and cash equivalents 6.73% 20.54% 4.11% 6.28% 4.88%
Total current assets 26.06% 37.11% 23.06% 28.82% 27.08%
Assets classified as held for sale 0.03% 0.05% 13.49% 0.00% 0.00%
Total assets
100.00
%
100.00
%
100.00
%
100.00
%
100.00
%
Liabilities and equity 0.00% 0.00% 0.00% 0.00% 0.00%
Liabilities 0.00% 0.00% 0.00% 0.00% 0.00%
Current liabilities 0.00% 0.00% 0.00% 0.00% 0.00%
Borrowings 0.87% 17.38% 5.82% 6.37% 7.75%
Derivatives financial instruments 1.03% 0.41% 0.76% 0.92% 1.13%
Current tax 0.21% 0.14% 0.06% 0.22% 0.33%
Trade payables 8.33% 7.45% 8.89% 12.30% 12.53%
Other payables 5.73% 5.66% 4.77% 5.28% 5.30%
Provisions 0.59% 0.72% 0.54% 0.39% 0.72%
Total current liabilities 16.75% 31.76% 20.84% 25.46% 27.76%
Liabilities classified as held for sale 0.00% 0.00% 3.11% 0.00% 0.00%
Non-current liabilities 0.00% 0.00% 0.00% 0.00% 0.00%
Borrowings 29.15% 17.38% 22.98% 24.50% 22.83%
Derivatives financial instruments 2.96% 2.31% 2.76% 3.51% 3.94%
Retirement benefits obligations 8.82% 8.11% 8.11% 10.51% 10.61%
Deferred tax liabilities 1.03% 0.93% 1.05% 0.87% 1.24%
Non-current tax 1.42% 1.34% 1.52% 1.20% 1.07%
Other payables 0.87% 0.80% 1.73% 1.40% 0.99%
Provisions 1.14% 1.43% 1.52% 1.72% 1.36%
Total non-current liabilities 45.38% 32.30% 39.68% 43.71% 42.04%
Total liabilities 62.13% 64.06% 63.63% 69.17% 69.79%
Stockholders' equity 0.00% 0.00% 0.00% 0.00% 0.00%
Ordinary share capital 9.21% 8.88% 11.01% 12.36% 11.68%
Non equity B shares 0.00% 0.00% 0.00% 0.02% 0.00%
Share premium account 16.15% 15.59% 11.71% 9.24% 8.76%
Capital redemption reserve 5.73% 5.52% 14.52% 20.17% 19.08%
Retained earnings (Loss) 3.45% 4.49% -1.95% -6.37% -4.88%
Other reserves 3.33% 1.46% 1.07% -4.60% -5.69%
Shareholders’ equity 37.87% 35.94% 36.37% 30.83% 28.95%
Non controlling interests 0.00% 0.00% 0.00% 0.00% 1.26%
Total equity 37.87% 35.94% 36.37% 30.83% 30.21%
Total liabilities and stockholders'
equity
100.00
%
100.00
%
100.00
%
100.00
%
100.00
%

28STRATEGIC FINANCIAL ANALYSIS
Cash Flow Statements:
Consolidated cash flow statement
Rexam
2011 2012 2013 2014 2015
Cash generated from operating activities
100.00
%
100.00
%
100.00
%
100.00
%
100.00
%
Net cash outflow from investing activities 5.07% 22.98% 64.06% 68.98% 96.53%
Net cash outflow from financing activities 31.50% 61.28%
298.78
%
145.71
% 24.61%
Net increase/(decrease) in cash and cash
equivalents 63.42%
184.26
%
262.84
% 23.27% 21.14%
Cash and cash equivalents at the start of the
period 20.93% 85.53%
305.38
% 52.91% 85.49%
Exchange differences and other adjustments 0.63% 4.04% 4.16% 1.11% 4.42%
Cash and cash equivalents at the end of the
period 84.99%
265.74
% 46.70% 77.29% 59.94%