FINANCE FOR BUSINESS Finance for Business
Added on 2020-05-16
9 Pages2135 Words364 Views
Running Head: FINANCE FOR BUSINESSFinancial analysis
Finance for Business 1ContentsIntroduction...........................................................................................................................................2Description of the company...................................................................................................................2Ownership and Governance Structure...................................................................................................2Substantial holders.............................................................................................................................2Main people involved in governance.................................................................................................2Key ratios..............................................................................................................................................2Movements in the share prices..............................................................................................................4Announcements.....................................................................................................................................6Stock information..................................................................................................................................6Weighted Average Cost of Capital (WACC).........................................................................................6Debt ratio analysis.................................................................................................................................7Dividend Policy.....................................................................................................................................7Letter of Recommendation....................................................................................................................7References.............................................................................................................................................8
Finance for Business 2Introduction The report contains a whole evaluation of Emerald Resources Limited Materials, a company listed on ASX. The analysis is done in aspect of its financial condition by considering variousfactors like dividend policy, weighted average cost of capital, return on equity, return on assets and debt ratio. The objective of this analysis is to provide advice to the investor regarding its investment in this company.Description of the companyEmerald Resources NL is a company in the gold industry sector that deals in exploring and developing gold projects. It has its head office in Perth, Western Australia and is listed on Australian Securities Exchange with code ASX: EMR. The main strategy of the company is to increase the shareholder value by identifying suitable advanced gold development projects.Emerald Resources had takeover Renaissance Minerals Limited (ASX: RNS delisted) in May2016 and is now focusing on the advancement and growth of its Cambodian Gold Project, operating in eastern region of Cambodia (Emeraldresources.com.au, 2018).Ownership and Governance StructureSubstantial holders More than 5%: Morgan Hart (12.21%), Ross Stanley (10.54%) and SHL Pty Ltd (5.41%)Morgan hart and Ross Stanely have more than 5% holding in company’s share capital and also are the part of firm governance. Both are the directors of Emerald Resources NL (Emeraldresources.com.au, 2018).Main people involved in governanceChairman: Mr Simon Lee AOBoard Members: Morgan Hart (Managing Director), Ross Stanley (Non-Executive director), Ross Williams (Non-Executive Director) and Justin Tremain (Executive Director).Key ratios (i)Calculation of ROA and ROEBoth the ratios are calculated on the basis of financial data taken from the annual reports of Emerald for past four years. Emerald Resources NL Financial Statements for year 2014-17Particulars2014201520162017AUD$ AUD$ AUD$ EBIT-971-1,400-1,326-8492.91Net profit411-1,343-1,346-8472.13Total Assets13,46618,10918,11047,098.80Total Liabilities89128433944.579Shareholders' Equity13,377 17,981 17,67746,154.22
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