Company Analysis Report Prepared for:Bega Cheese LTD Prepared by:xxx
1EXECUTIVE SUMMARY This report has been prepared to analyse and evaluate the financial position, financial performance, financial stability, liquidity etc of Bega Cheese limited. This report has been prepared to offer a conclusion to the investors about the financial position and the performance of the company so that it becomes easy for them to make a decision about the investment in the company or not. For this report, ratio study has been conducted. Firstly, the introduction has been given about the company and the industry further; various ratios have been measured to evaluate the financial position of the company.
TABLEOFCONTENTS 1EXECUTIVE SUMMARY.....................................................................................2 2INTRODUCTION................................................................................................4 3Profitability......................................................................................................5 3.1Return on shareholder equity....................................................................5 3.2return on total assets................................................................................6 3.3Net profit margin.......................................................................................7 3.4Gross profit margin...................................................................................8 4efficiency.........................................................................................................9 4.1inventory turnover....................................................................................9 4.2settlement period for accounts receivable..............................................10 4.3settlement period for creditors / accounts payable.................................11 4.4asset turnover.........................................................................................12 5liquidity.........................................................................................................13 5.1current ratio:...........................................................................................13 5.2cash flow from operations.......................................................................14 6financial gearing............................................................................................15 6.1gearing ratio...........................................................................................15 6.2interest coverage....................................................................................16 7conclusion/ recommendations.......................................................................17 8references.....................................................................................................18 9APPENDIX A...................................................................................................19 APPENDIX B.........................................................................................................20
2INTRODUCTION Profile ofBega Cheese Limited–. Bega cheese is an Australia company which is managing its operations in dairy industry of Australia. This company is one of the largest Australian dairy companies. Current valuation of the company is Australian $ 775 million. Around 25% share of Australian dairy industry is held by Bega cheese. This company has diversified its market into various countries to grab more opportunity. Various dairy products such as cheese yogurt, retail cheese, processed cheese, chilled food etc are offered by the company in the Australian market (Bloomberg, 2018). History This company has been founded in 1899 and in 2011; it has become public limited company. Initially, it has been founded by an agriculture corporative firm. Currently, this company has been listed in Australian stock exchange. Earlier, this company used to offer its services and the products into limited area. But now, it has diversified its market. Industry Bega cheese is an Australia company which is managing its operations in dairy industry of Australia. This is one of the largest Australian dairy companies. Various companies are operating its business in Australian dairy industry, but around 25% share of Australian dairy industry is held by Bega cheese.
3PROFITABILITY For analysing the performance and the position of Bega cheese limited, profitability ratios have been calculated. Profitability ratios brief the investors and the financial analyst about the net profit, gross profit position of the company in terms of equity, share capital etc. Following is the calculation of profitability position of company: 3.1RETURNONSHAREHOLDEREQUITY Return on shareholder is a measurement which analysed the performance of the stock of a company. Following is the formula of calculating the return on shareholders’: Return on Equity= Graph 1: Return on Equity (ROE) (%) The above ratio explains that the return on equity of 2014 was quite higher but in 2015, the ratio has been lower and in 2016, company has again tried to enhance it. Through the above graph, it has been found that return on equity position of 2016 of Bega cheese is quite improved and it explains that the stockholders would get a god return form the company (Annual report , 2016). 2014-20152015-2016 Increase/ decrease22.923.963.968.99 = - 18.96%= +5.03% Figure 1:Yearly Increase/Decrease on Return on Equity (ROE) (%)
3.2RETURNONTOTALASSETS Return on total assets is a measurement which analysed the performance of the total assets of a company in context with the total net profit of the company. Following is the formula of calculating the return on total assets: Return on total assets (ratio) = Graph 2: Return on Total Assets (%) The above ratio explains that the return on total assets of 2014 was quite higher but in 2015, the ratio has been lower and in 2016, company has again tried to enhance it. Through the above graph, it has been found that return on total assets position of 2016 of Bega cheese is quite improved and it explains that the good level of total assets have been managed by the company according to the total assets of the company. 2014-20152015-2016 Increase/ decrease17.052.982.980.01 = - 14.07%= - 2.97%Figure 2:Yearly Increase/Decrease on Return on Total Assets (%)
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