Financial Analysis and Qualitative Factors of Marks & Spencer's

Marks & Spencer’s
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Contents
Introduction-About the Company..............................................................................................3
Financial Analysis......................................................................................................................3
Qualitative factors affecting future performance of the company.............................................8
Corporate Governance of the Company.....................................................................................9
Conclusion................................................................................................................................10
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Introduction-About the Company
Marks and Spencer’s is one of the leading British brands, which have its headquarters located
in London. The company is listed on London stock exchange. The primary activities of the
company are selling branded line of clothes and foods. Over the years, the revenue generation
form clothing line has decreased and that from food has increased. The last reported market
capitalisation of the company was 4.56 billion GBP. The company has over 1433 stores
spread worldwide and is also engages in online trading. (Marks and Spencer's Group Plc,
2017)
In our discussion below we will cover the financial performance of the company along with
its future prospects and also its corporate governance strategies.
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Financial Analysis
In order to analyse the financial status of the company we have conducted ratio analysis.
Ratio analysis is the financial tool which helps us calculate the returns and financial
performance in quantitative data. This helps us analyse the company performance and make
decisions (Bragg, 2016).
Return on Assets
2017 2016 2015
Net Income 116 404 482
Total Assets 8,293 8,476 8,196
Return on Assets 1.40 4.77 5.88
2017 2016 2015
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
Return on Assets
Net Income
Total Assets
Return on Assets
Return on assets is the profitability ratio which helps the investor calculates the return they
earn in terms of percentage of assets (Fridson & Alvarez, 2012). Return on assets ratio is also
referred to as return on investment ratio. The return on assets of the company has been
declining over the years. The company reported a return of 5.88% in 2015, it declined to
4.77% in 2016 and finally the lowest return of 1.40% was reported by the company in 2017.
There has been decline in the investment and net income in 2017 as compared to last years.
Net Profit Margin
2017 2016 2015
Net Income 116 404 482
Sales Revenue 10,622 10,555 10,311.40
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