Managing Finance Coursework: Financial Ratio Analysis of Morrison PLC

2. MANAGING
FINANCE
Coursework

EXECUTIVE SUMMARY
A fundamental concept in a corporate is the handling of cash and the economic resources of
the company. This management is carried out with the help of many techniques outlined in
strategic management. Financial ratio interpretation is one of the most important tools for
forecasting business performance and making adjustments in the firm that are needed to do better
inside the marketplace. The use of financial ratios in the instance of Morrison PLC, a UK based
supermarket, is highlighted in this report. The firm receives an analysis of the ratios as well as
recommendations. The study takes into account the company's annual reports for the years 2019,
2020, and 2021.

Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................4
MAIN BODY..................................................................................................................................4
Background of the company Morrison........................................................................................4
Comments on the performance of company using the Financial Ratio Analysis........................4
Analysis of the Financial Statements...........................................................................................6
Findings from the above Ratio Analysis with recommendations made to the company.............7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9
APPENDIX....................................................................................................................................10

INTRODUCTION
Managing finance is a classifying the resources of the organisation considering the
management principles which needs to be followed. It also assists in formulating the financial
policies and controlling them in an appropriate manner. It is one of the most major part of the
organisation (Abutabenjeh, 2021). In this report, the ratios of the company Morrison Plc has
been calculated of the year 2019 to 2021. Through this the efficient profitability, and the
liquidity position of the company can be analysed. Morisons is a supermarket which is based in
UK and is a public limited company (PLC) on the London stock exchange. It was established in
the year 1899 and was founded y William Morrison. Further the interpretation of the ratios id
done and a suggestion is given that the investor should invest or not in the organisation.
MAIN BODY
Background of the company Morrison.
WM Morrison Supermarket Plc, incorporated in Bradford, West Yorkshire, England, is the
UK's fourth largest supermarket company. William Morrison established it in 1899. It all started
with an eggs and cream booth in Bradford's Rawson Market. Morrison had predominantly
focused its shop sites in the northern England until 2004, when it acquired Safeway. The
enterprise now has 475 stores in the United Kingdom. Food and grocery - the weekly shop –
account for the majority of company revenue. Morrison sources and processes a wide range of
foods in-house, allowing them to maintain strict control so over source and quality (Anopchenko
and Ostrovskiy, 2021). Furthermore, they employ more employees to prepare food in the store
than every grocery.
Comments on the performance of company using the Financial Ratio Analysis.
Profitability Ratio: It is computed for the classifying the capability of the corporation in
term of the profit and the benefits earned on the net revenue and other costs. Here, the usage of
income statement is mainly used for computing the proportions. These ratios are calculated
below:
 Net profit Margin = (Net income / Net sales) * 100
2021 = (96 / 17598) * 100 = 0.545 %