Financial Management: Analyzing the Financial Performance and Position of Companies

FINANCIAL MANAGEMENT

Executive Summary
The report is about analysing the financial performance and position of company. The financial
statement show only figures but actual performance is not analysed by direct. For knowing t5he
actual position of company ration analysis is performed by companies and investors for knowing
the true position of company. This provides them with base to make decision for theie
investments and management to make decisions for improving the performance of company.
Ratio analysis has helped to compare the results and operation of two companies.

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Business profiles of two companies.................................................................................................1
ANALYSIS......................................................................................................................................1
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Financial management refers to organizing, planning directing & controlling financial
activities like procurement and utilizing funds for enterprise. It refers to the application of
management principles over the financial resources of enterprise. There are various companies
operating in market in which investment can be made. Financial statement of company do not
provide the direct and clear position of company. Before making any decision about the
performance of company, users perform ratio analysis for comparing the results of companies.
Ratio analysis helps users to identify the difference in performance of two companies. This
report is based on Ryanair Plc which offers airline services to the customers at suitable prices.
Hence, the present report perform the ratio analysis of two companies that are listed on London
stock exchange. For analysing the financial performance of Ryanair, from several perspectives
such as profitability, liquidity, efficiency and financial gearing, in against to its competitor Easy
Jet of Ryanair has been taken as the company and Easy jet ratio analysis tool has been applied.
Business profiles of two companies
Ryanair Holdings Plc
Ryanair is Irish airline company founded in 1984, having headquarters in Dublin, Swords
and Ireland. It is largest of the in Ryanair Holdings. It became largest Budget airline in Europe
that carried international passengers more than other airline. Ryanair is operating above 400
Boeing 737-800 aircrafts with only one 737-700 charter aircraft. Ryanair networks are serving
over more than 38 European countries. Company faced criticism over employee conditions and
extra charges. Parent company of Ryanair airlines is Ryanair Holding plc. Company is serving
from last 34 years and now is having an employee base of 17500 people (Furse, 2016).
Easy Jet plc
It is UK based airline carrier with low costs. Company is operating as company with low
costs as short haul airline. Company is serving over more than 1000 routes in 30 countries. It is
listed over LSE. Company has expanded its growth by number of acquisitions and demands for
low cost travel. Company with its associate companies like easy jet Switzerland and easy jet
Europe is operating above 300 aircraft. It carried above 65 millions of passengers in 2014 that
made it 2nd largest budget airlines in Europe behind Ryanair. Company is serving from last 24
years since 1995 with staff base of nearly 14000 persons (Milkiewicz, 2015).
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