Comparative Evaluation of NRW Holdings Limited and Reliance Worldwide Corporation Limited

FINANCING ENTERPRISES
200910
SPRING 2018

TABLE OF CONTENTS
Introduction......................................................................................................................................3
Question 1........................................................................................................................................3
Analyses of the liquidity position of NRW Holding Limited and Reliance Worldwide
Corporation Limited....................................................................................................................3
Question 2........................................................................................................................................5
Question 3........................................................................................................................................8
Part A...........................................................................................................................................8
Part B.........................................................................................................................................10
Question 4......................................................................................................................................10
Question 5......................................................................................................................................12
References......................................................................................................................................13

INTRODUCTION
The present study is based on a comparative evaluation of NRW Holdings Limited and Reliance
Worldwide Corporation Limited by computing their financial ratios and comparing with industry
standards. Overview of both the companies is as follows:
NRW Holdings Limited
NRW Holdings is well known for providing the diversified services to the resources, civil
infrastructure, energy, and urban development areas. The company is operating with a team of
nearly 2000 industry-experienced employees as a civil and mining service provider. Moreover,
they have boasted a solid position for carrying up multifaceted projects in a demanding
environment (Annual report of NRW Holdings Limited, 2017). NRW Holdings is a group of
leading business that supply services like civil construction and mining in Australia as a whole.
The Group is composed of Brisbane based civil and mining services business, Golding NRW
Civil and Mining based in Perth, Perth based maintenance and manufacturing provider AES
Equipment Solutions. Further, the cited company is one of Australia’s largest drill and blast
companies.
Reliance Worldwide Corporation Limited
Reliance Worldwide Corporation plans, produce, and supplies water control systems and
plumbing way out for domestic, industrial applications, profitable. It presents a choice of
thermostatic force, temperature control, dividing, and growth control, regulator (Annual report of
Reliance Worldwide Corporation Limited, 2018). Moreover, the company offers industrial and
airline fittings , tube connection fittings, water control devices, valves, threaded, adaptors, taps,
tubing and accessories PVC hoses, and fire plumbing products, for example, boosters, hydrant
valves standpipes, PEX pipes, and couplings. It makes delivery of the products for, plumbing,
sanitary, and heating industries in Europe as well as internationally.

QUESTION 1
Analyses of the liquidity position of NRW Holding Limited and Reliance Worldwide
Corporation Limited
The liquidity ratio assists the company to evaluate the liquidity position so that the company can
determine its capacity for the payment of the long-term debt obligation as well as the short-term
debt obligation. There are many types of liquidity ratio, by which the company can ascertain the
liquidity position. Among the various ration, in this current study ratio and the quick ratio has
been considered to evaluate the overall liquidity position of the company (Wahlen, Baginski, and
Bradshaw, 2014).
Current ratio determines whether the company can meet its short-term obligation of the debt as-
as when they arise. In other words, through the current ratio company can evaluate about its
resources and whether the resources are sufficient for the payment of the short-term liability of
the company (Yu, & et al. 2014).
The quick ratio, which is also known as the acid test ratio, measures the company’s capacity to
pay off its short-term debt in a more comprehensive manner. It determines how fast the resources
of the company can meet its current liability.
Calculation of the liquidity ratio of NRW Holdings Limited
Amount In Million $
Particulars Formula 2018 2017
Current Ratio Current Assets/Current Liabilities
Current Assets 206.631 116.098
Current Liabilities 186.035 83.206
Current Ratio 1.11 1.39
Quick Ratio
Current Assets-Inventory/Current
Liabilities
Current Assets-Inventory 184.154 99.81
Quick Ratio 0.99 1.19
Calculation of the liquidity ratio of Reliance Worldwide Corporation Limited