Financial Analysis of BHP Billiton and Rio Tinto

Financial
Analysis
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FINANCIAL ANALYSIS 1
Overview of the organisation
In this report, BHP Billiton has been taken into consideration to analyse the financial
condition of the company. The ratio of Rio Tinto will also be evaluated to analyse the
position of the company in the industry. BHP Billiton is an Australian multinational mining,
metal and petroleum dual-listed public company. Rio Tinto is also a mining company under
the Australia stock exchange. It is ranked as the world largest mining company which is
based on market capitalisation. As per the review of the Chairman of the company, the
numbers of asset are founded around the world in different locations. The Chairman Tone is
optimistic as he is confident that the company is well placed to deliver the shareholder value
and returns due to which it attains the success in future.
Balance sheet
Horizontal analysis of Balance Sheet
2017 2018
Varianc
e
Cash 14184 15871 1687
Accounts
receivable 2836 3096 260
Total assets 117006
11199
3 5013
Vertical Analysis of balance sheet

FINANCIAL ANALYSIS 2
Cash 14.17%
Accounts
receivable 2.76%
Total assets 100%
As per the horizontal analysis, it is observed that the total asset of the company is
increases with the amount of 5013. The total asset of the company is increases due to
receiving the debt amount from debtors (2836 to 3096). The cash in hand is also increases
(14184 to 15871) due to which the total asset is increases (BHP Billiton, 2018). According to
vertical analysis, it has been evaluated at the total asset of the company is 100%. The account
receivable of the company is decreases 2.76% as which is very less percentage that is why;
the total asset of the company is less. Although, the total asset of the company have effective
amount but it is require to increases the percentage of receivable and cash.
Income statement
Horizontal analysis of income statement
2017 2018
Varianc
e
Sales 38285 43638 5353
Cost of Goods sold 17016 17204 98
Gross margin 21269 26434 5165