Financial analysis report of Telstra Telecommunication company

Financial analysis report of Telstra Telecommunication company

Executive summary
This report includes the analysis of Telstra Corporation Limited and it deals in building and
operating telecommunication networks and markets voice, mobile, internet access, pay television
and other products and services. It includes the analysis of evaluating the potential investors of
the company and it is based on the financial performance and market reviews of the company.
They are committed to providing the best services to customers. They offer a full range of
services and compete in all the telecommunications market in Australia. This report includes the
analysis of financial performance of the company. The analysis of the report is done to make the
recommendation for shareholders for making the investment and required decisions for
improving the financial performance of the company.
Analysis
Telstra telecommunication is analyzed as one of the largest network providers in Australia. The
below information includes the financial performance of the company from the Telstra annual
report for the year ended 30th June 2018. It is analyzed that the total income of the company has
been decreased with 3.6% as compared to last year and the net profits of the company are $2.1
billion. The various factors are considered by the board for capital management as well as
maintaining the financial strengths and financial flexibilities. The operating expenses of the
company are increased by 6.5 percent form the last year. The current assets of the company have
increased by 1.4 percent and it has helped in increasing the sales of the company by $121 million
(Telstra Telecommunications Company, 2019). The total revenue of the company has decreased
as well as the total income. The finance cost of the company has increased from $42 million to $
630 million because of increase in net borrowing costs. The balance sheet of the company was
strong because of net assets value which is $14,530.

The financial position of the company
Return on Equity
Year 2019 (in dollars)
Net Profit (A) 2,149
Shareholder's Equity (B) 14,530
Ratio (A/B) 0.15
Return on Asset
Year 2019 (In dollars)
Net Profit (A) 2,149
Total Asset (B) 42,589
Ratio (A/B) 0.05
Current Ratio
Year 2019 (In dollars)
Current Asset (A) 7,303
Current Liability (B) 9,553
Ratio (A/B) 0.76
Liquid Ratio
Year 2019 (In dollars)
Liquid Asset (A) 6,855
Inventories (B) 448
Current Liability (C) 9,553
Ratio (A)-(B)/(C) 0.67