External Sources of Finance and Financial Analysis of Dominos Plc

Dominos Plc

Contents
Introduction:........................................................................................................................................3
Main Body............................................................................................................................................3
Examine the external sources of finance that are available to Dominos Plc......................................3
Analysis and interpretation of Dominos Plc’s financial statements with the help of ratios:...............4
Review of recent media coverage of Dominos Plc and its impact on the share price and market
capitalization:....................................................................................................................................9
The stock movements of Dominos Plc and its comparative study with relevance to FTSE index. . .10
Conclusion...........................................................................................................................................12
References..........................................................................................................................................13

Introduction:
Dominos Plc is the UK Based food retail outlet. (John., 2021). The upcoming report
looks into the various types of finance sources that a business can use in order to raise funds.
Along with this it also includes the analysis and interpretation of financial records and events
by the calculation of ratios. In addition to this, it also highlights the news pointers that have
affected the share price and market capability of Dominos Plc. Furthermore, it also contains
the analytical data and theory for the stock price movement with respect to Russell group.
Main Body
Examine the external sources of finance that are available to Dominos Plc.
The word external source of capital recommend itself the nature of finance. Dominos
Plc. can raise income from outside origins like equity capital, preferred stock, loans, trade
credit, overdrafts etc.
The contemporary and external sources that are available to Dominos Plc are as follows:
 Equity Shares: A big company like Dominos Plc can opt for this method in order to
raise the funds. In this, the return is in the manner of dividend which is given to the
shareholders. The return arising from thus method is not tax deductible. Dominos Plc.
will have to undergo with so many legal procedure formalities to generate money
from this source. But it will be easy for Dominos Plc. as it holds a great goodwill and
so the investors have faith with this outlet. (John and John., 2021).
 Debentures: Dominos Plc can also use this to raise finance because it is the most used
method that a business uses in order to generate the finance. It is said to be the
cheaper mode when compared to equity (Wang, Feng, and Huan., 2021). It does not
involve high cost because the return is tax- deductible. Dominos Plc. can issue the
debentures to the common public. This issue includes some amount of cost.
 Term Loans: In this, Dominos Plc can borrow money from some banks or the
financial institutions. A brief analysis of a company’s fiscal is carried out and the
repaying potential of money in future of a business is checked before granting loans.
Dominos Plc can go for this as well because it has good financial records and gain
good amount of profit.
 Preferred stocks: It contains the features of both i.e., the equity stocks and debt. It is
known as preference share because the equity holders are given priority in it.
Dominos Plc will have to make them the payment first at the time of liquidity.

 Leasing and hire Purchase: Dominos Plc can choose any of them as the set of choices
between the delay in the cash payment for goods if supported by the suppliers which
is same as having the products funded. They both given an option to the owner of a
company to buy an asset when its term ends.
 Bank- overdraft: It is the short-term external source through which Dominos Plc. can
raise money. Bank – overdraft is mainly for the short- term financing that helps the
business enterprises to meet its day – to – day needs for money.
 Trade- credit facilities: Dominos can ask for the credit from its creditors and
suppliers. Lenders can help the organization to delay the payments for some time –
frame.
 Factoring in debt: In this Dominos Plc can sell its receivables on discounted rates. In
this the buyer can collect the money from the debtors in place of firm and can charge
some amount of premium for providing this kind of services.
 Venture Capital: It is the same source just like an equity share. But in this the
investors are the different group of people. In this the money is invested in new
business by doing the proper analyzation and observation of the financials.
Analysis and interpretation of Dominos Plc’s financial statements with the help of ratios:
Income statements: These are the records that states the expenses and income that a
company has occurred during the financial period. Financial Statements: These statements
reflect the financial position of company’s assets and liabilities.
 Following are the profit and loss account and statement of financial position of
Dominos Plc for 2021:
Income statement for accounting period 2021