Finance for Managers: Importance of Finance and Ratio Analysis of Renishaw plc

FINANCE FOR MANAGERS

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
REPORT..........................................................................................................................................1
CONCLUSION ...............................................................................................................................4
REFERENCES................................................................................................................................5
Ratio Analysis of Renishaw plc...................................................................................................6

INTRODUCTION
Finance is term broadly described for study and systems of the money, investment and
financial instruments. Authorities have preferred to divide the finance in three categories that is
public finance, personal finance and corporate finance. Most important is corporate finance and
has critical role in every business. Business cannot run smoothly without the availability of
sufficient finance to carry out the operations. Present report has covered the importance of
finance. This has used ratio analysis as a tool for assessing the financial health and position of
company. In the present report Renishaw plc has been taken as the host company. Report will
enhance the understanding of the financial performance of company using the financial ratios.
REPORT
Renishaw Plc
Renishaw plc is British engineering corporation which is based in Gloucestershire.
Company specialise in measurement, healthcare, motion control, spectroscopy and for
manufacturing. It is also known for the measuring machines & machine tools. Company is
leading in the metal additive production where the machine prints part using metal powder.
Company is listed over London Stock Exchange (LSE) and constituent of FTSE 250 Index. It is
operating since 1973 in the engineering industry. Company had revenues of 574 million in 2019
with operating income of 99.8 million. It employs over 4968 people in the industry.
Assessing financial performance of company.
Financial performance of the company can be measures using number of indicators such
as financial ratios like liquidity ration, solvency ratios, profitability and many more ratios.
Measuring financial performance is essential to identify the health and position of the company
in the industry in comparison to its competitors. The users before investing he funds assess the
financial performance by analysing its profitability, its liquidity position, operating efficiency
and the financial structures. Ratio analysis is an essential tool used by the experts and users of
financial statements for assessing the viability of their investments. They prevent the investors
from blocking their funds in industries having low profitability and returns. In the present case
financial performance of Renishaw plc has been assessed. In depth analysis of financial
statements have been carried out in the report.
Profitability Ratios
1