Financial Performance Analysis of Pharmaceutical Companies: A Report

This report provides a detailed financial analysis of three pharmaceutical companies: GlaxoSmithKline, AstraZeneca Plc, and Shire Plc. It begins with an introduction to financial ratio analysis and its significance in assessing industry efficiency and capabilities. Section A focuses on the justification and selection of financial and non-financial ratios, including profitability, operational, and liquidity ratios, to evaluate the companies' performance. The report identifies the best-performing organization for investment and the worst-performing company, offering recommendations for financial improvement. Section B delves into the capital investment decision-making process, exploring investment appraisal methods. The analysis covers key financial ratios, including ROCE, ROA, profit margin, gross margin, net assets turnover, interest cover, collection period, current ratio, liquidity ratio, and gearing ratio. Non-financial ratios, such as profit per employee and costs of employees/operating revenue, are also assessed. The report concludes with a summary of findings and recommendations, offering valuable insights for investors and industry professionals.

ACCOUNTING AND
FINANCE FOR MANAGERS

TABLE OF CONTENTS
INTRODUCTION..............................................................................................................1
SECTION A (QUESTION 1).............................................................................................1
a) Justification and selection of 10 financial and 2 non-financial ratios of 3 industries
................................................................................................................................. 1
b) Identification of best performing organisation in context of making investment. 13
c) Determination of poor performing company and recommending the way to improve
financial performance of business.........................................................................14
SECTION B (QUESTION 2)...........................................................................................14
a) Stating the key stages in Capital Investment Decision making process and the role
of investment appraisal..........................................................................................14
Identifying and explaining the main methods of investment appraisal used in practice
...............................................................................................................................15
CONCLUSION............................................................................................................... 17
REFERENCES...............................................................................................................18
APPENDIX..................................................................................................................... 20
Appendix 1.............................................................................................................20
Appendix 2.............................................................................................................21
Appendix 3.............................................................................................................23

INTRODUCTION
Analysis of efficiency and capabilities in an industry will require proper financial
examination. Implications of ratio analysis technique will be assistive to users of such
information in context with judging the strength of business. The outcomes can be used
in investment decisions as well as internal operational improvements to rise market
value of business. In the present report, there will be discussion based on analysing
financial health of 3 companies pertaining to pharmaceutical industry namely
GlaxoSmithKline, Astrazenenca Plc and Shire Plc. Along with this, identification of poor
and the best performing organisation will be acknowledged as per ranking and relevant
suggestions will be facilitated to professionals of these industries. Further, it will provide
in-depth insight of how investment appraisal tools and techniques aid in financial
decision making.
SECTION A (QUESTION 1)
a) Justification and selection of 10 financial and 2 non-financial ratios of 3 industries
To demonstrate operational efficiency and ability of firm, there are various tasks
and objectives which will address various facts that are required for effective
management. In this context, there has been analysis made on profitability, liquidity and
various non-financial efficiency of 3 pharmaceutical companies.
PROFITABILITY RATIOS
ROCE using Net income (%): This a technique of identifying amount of net
income generated by an industry that will be payable to shareholders in terms of
debentures (Wijethilake, 2017). Thus, it will help in retaining the higher number of
investors associated with firm. This is a ratio which is determined to have effective
financial measurements and demonstration of profitability of an organisation (Limon and
Crozet, 2017). Moreover, these are the returns which have been payable by an
organisation with a motive of analysing its efficiency and operational increment.
1

Figure 1: ROCE using Net income (%)
Interpretation: To analyze profitability of these organizations as per net income
and total capital employed, this ratio will be helpful for analyzing returns obtained by firm
on capital employed. Thus, in this respect, the morality of outcomes determines huge
variations in GlaxoSmithKline and Shire Plc with respect of Astrazenenca which reflects
constant outcomes in each period. Along with this, it can be said that there has been
rise in the ratio of AZ in 2016 as 8.55% to 10.33% which determines that there was
increase in profitability in this period. However, with the impacts of such increment,
there will be rise in value of marketable securities of firm.
ROA using Net income (%):
2

Figure 2: ROA using Net income (%):
Interpretation: In consideration with the above listed analysis, return payable by
these organizations on their assets was measured. It ascertains large number of
changes in operations due to rise in assets of firm with respect to its debts. There has
been increment in capacity of making returns on assets. In analyzing the performance
of all organizations, GSK has higher variations in each year which shows drastic rise
and fall in ratios while Shire Plc has poor returns of assets. It demonstrates that there
has been reduction in ratios over the period. On the other side, AZ has reflected
consistency in performance which leads to have higher ratio in 2016. It was increased
from 4.70% to 5.60% on which it can be said that firm is capable of making proper
returns on their assets.
Profit margin (%)
It is the income of an organisation after making necessary adjustments and
payments of all operating expenses in business (Christ and Burritt, 2017). Thus, this
profit will be used in making payment to dividend holders and in further operational
practices.
3

Figure 3: Profit margin (%)
Interpretation: To evaluate profitability of selected firms, which were analyzed in
those respective years. In this respect, AZ has effective profitability and favorable
outcomes as compared with GSK and Shire Plc. GSK had reduction in the profit margin
in 2016 from 43.37% to 6.85%. Thus, firm has poor performance in the year while in
analyzing AZ’s profitability, there was a favorable reform in this ratio. It had raised in
2016 from 12.10% to 15.08%. Thus, firm has control over its operating expenses more
effectively than other competitors. Administrating each transaction will be helpful to the
entity in terms of developing fruitful gains.
Gross margin (%):
These are the profits which have been generated by an organization over its
sales as well as for adjusting costs of production. It will ensure profitability of entity
based on its expenses incurred in manufacturing process. However, the below listed
graphical presentation will be helpful in reflecting GP margin of respective firms.
4

Figure 4: Gross margin (%)
Interpretation: As per addressing the above listed graph, it reflects GP margin of
GSK, AZ and Shire Plc. These firms have favorable outcomes as they reflect analysis
which is more than 65% in each year. GSK was reflecting consistent margin as they
have managed to perform operations which have brought them suitable gains. Among
these companies, Astrazenenca has the most effective sales and less cost implied over
activities. It reflected the rise in ratio as in 2016, it was at 85.60% which is higher as
compared with other entities.
OPERATIONAL RATIOS
Net assets turnover (x):
5

Figure 5: Net assets turnover
Interpretation: Operating profitability of a firm demonstrates ability to make the
future operations and paying off shareholders of a business. In analysing the net asset
turnover of business, GlaxoSmithKline has comparatively positive outcomes that other
competitors are more capable of having effective net asset. As compared with other
entities, GSK was more efficient in making operating expenses. It increased in the year
2016 from 0.61 to 0.71. Thus, such operational increment will be helpful in meeting
goals at the right time.
Interest cover (x):
6

Figure 6: Interest cover
Interpretation: The above graphical presentation represents changes in results
of interest cover ratio. The interest cover that has been payable by an organization to
shareholders will be effective in making payment to their returns. Shire Plc has huge
reduction in the ratio from 2014 to 2016. On the other side, GSK and AZ had consistent
returns. In 2016, GSK had effective dividend policies which will be helpful in making
payments to shareholders as well as increase in ratios.
Collection period (days):
7

Figure 7: Collection period (days)
Interpretation: As per ascertaining the outcomes, GSK, AZ and Shire Plc have
been analyzed for their efficiency in accounts receivables. Thus, with respect with the
same, AZ is more capable in collecting the receivables. Reduction in ratios of firm
presents that 66 days in 2015 reduced to 39 days in 2016. Thus, lower accounts
receivables reflect less time to recover them.
LIQUIDITY RATIOS
Current ratio (x)
8

Figure 8: Current ratio
Interpretation: Outcome of financial ratio shows fluctuating trend in the current
ratio of all the 3 selected pharmaceutical companies. In the accounting year 2016,
current ratio of GSK and AZ decreased significantly. On the other side, current ratio of
Shire Plc inclined from .61 to .97 at the end of accounting year 2016. In accordance with
the ideal ratio, firms need to maintain 2 current assets in against to 1 obligation.
Referring current liquidity position, it can be presented that all the three firms were failed
to maintain enough assets as per obligations. Hence, such concerned companies need
to focus on maintaining enough assets which in turn can be used for meeting the
obligations on time.
Liquidity ratio (x)
9

Figure 9: Liquidity ratio
Interpretation: The above depicted column graph presents declining pattern in
the quick ratio of GSK, AZ and Shire Plc. In FY 2016, quick ratio of GSK, AZ and Shire
Plc implied for .61, .72 & .51 respectively. On the basis of ideal measure, business units
must have 1 asset which can easily be converted into cash over 2 liabilities. Hence, in
accordance with graphical presentation, liquidity position of such three firms were in line
with ideal measure. Thus, it can be entailed that GSK, AZ and Shire plc is capable to
meet the current obligations from quick assets such as cash, debtors, etc.
Gearing (%):
10

Figure 10: Gearing ratio
Interpretation: By doing ratio analysis, it has been assessed that gearing ratio of
concerned pharmaceutical companies has increased significantly over the years. This in
turn not recognized as good indicator because as per ideal measure, debt-equity ratio
must be .5:1. Results of ratio analysis clearly exhibits that gearing position of all the
selected three pharmaceutical firms were too higher in comparison to the ideal
measure. Moreover, concerned firms have raised or generated more funds through
equity rather than debt. Thus, it can be presented that capital structure of AZ and GSK
was not optimal from 2014 to 2016. However, as compared to the competitors, Shire Plc
has maintained effectual capital structure by including the combination of equity and
debt.
NON- FINANCIAL RATIO
Profit per employee (th):
11

Figure 11: Profit per employee
Interpretation: Outcomes derived through ratio analysis present that profit per
employee associated with Shire Plc was decreased significantly from 415 (th) to 17.
Along with this, profitability generated by GSK from per employee also decreased over
the time. On the contrary to this, profit per employee of AZ inclined from 14 to 48 th
respectively. Overall, evaluation presents that profitability (generated through
employees) of AZ is good as compared to the competitors.
Costs of employees / Operating revenue (%):
12

Figure 12: Costs of employees / operating revenue
Interpretation: Column graph depicted above entails that lower cost is
associated with per employee in context of Shire Plc. However, GSK and AZ spent high
on employees over revenue. This is not a good indicator because it directly impacts
over profit margin of firm and thereby, on the overall success. Thus, companies need to
make focus on the development of competent strategic framework which makes
contribution in cost reduction and profit maximization.
b) Identification of best performing organisation in context of making investment
Profitability: In consideration with the below listed appendix, it can be said that
profitability of Astrazenenca and GlaxoSmithKline are more favorable than Shire.
Among them, AZ has been denoted on 1st rank due to proper execution over cost as
well as sales revenue of firm in due period. However, investing in AZ and GSK will be
profitable for investors to gain appropriate returns on their capital.
Efficiency: The operational performance of GSK is more effective. It has been
treated as on 1st position because of the best performance and accuracy in allocation of
funds in all units or departments in organization.
Liquidity: In relation with liquidity and efficiency, Shire Plc and GSK has the most
positive outcomes (Abdullah, Hassan and Kassim, 2017). Therefore, their short as well
13

as long term solvency is comparatively favourable than AZ. Thus, GSK has been
ranked as 1st, Shire as 2nd and AZ as 3rd.
Non-financial ratios: As per considering non-financial ratios of these firms, Shire
plc has more positive outcomes than AZ and GSK. CSR activities of firm are more
balanced and satisfactory which have resulted in making proper administration of
operations.
Moreover, after analysing all data set and performances of all firms, it can be said
that AZ will be a suitable company for making investment. The profitability and efficiency
of business will be beneficial to investors in terms of having proper returns on their
invested capital.
c) Determination of poor performing company and recommending the way to improve
financial performance of business
On the basis of ratio analysis and ranking, AZ and GSK is recognized as poorly
performing firms in comparison to Shire Plc. Hence, such business units need to take
effectual measures for making improvement in the financial position and performance
such as:
 GSK and AZ should focus on undertaking budgetary control tools and
techniques. This in turn helps such companies in exerting control over expenses
and thereby, enhances profitability.
 Further, while raising funds, GSK should keep in mind the ideal ratio of .5:1. In
other words, such business unit should consider combination of both debt and
equity while raising funds. This will help GSK in developing optimal capital
structure to a great extent and exert control over undesirable expenses.
 Along with this, both GSK and AZ are suggested to maintain liquidity within firms
on the basis of their working capital requirements (Trinh and Thao, 2017).
 In order to improve the performance from non-financial aspects, business units
need to make focus on organizing training and development session for
personnel. This in turn helps in enhancing the efficiency and ability of personnel
which makes contribution in productivity as well as profitability.
14

SECTION B (QUESTION 2)
a) Stating the key stages in Capital Investment Decision making process and the role of
investment appraisal
To ensure profitability of proposed plan, which is required by professionals for
initiating or investing in a new project. In addition, there can be use of various
techniques which will help in administrating the operations such as:
 Project identification: For funding the operations and developing effective plan
for industrial functions, it is required to have an effective internal management of
activities (Christ and Burritt, 2017). The immersion of effective planned project
will be required to have proper identification of all resources. There is need of
determining resources such as funds, reliability of project, human capital, etc.
 Project screening: Timeliness is mandatorily required by an entity for having
effective control on resource allocation as well as on their utilisation. Managing
operations in a manner for achieving goals, meeting financial requirements as
well as monitoring activities (Wijethilake, 2017). Along with this, proper screening
of all required terms is quite necessary for a business.
 Analysing and accepting: Assessment of various functions will define
alternative solution and decision making for resolving risks and obstacles which
normally incurred in operations. Ascertainment of all risk factors will bring
successive growth to the invested project in required timeframe.
 Implementation: It ensures that all techniques and tools which will be used by
professionals in relation with operating activities of firm are to be properly implied
(Bader and et.al., 2018). It consists of proper planning for cost estimation and
policies to perform the tasks.
 Monitor and adjust: After preparation of blue print and implication of such
drafted plan, it needs to have proper execution. It will bring information regarding
loopholes or drawback of the plan which will be modified in terms of enhancing
operational efficiencies (Begg, 2017).
 Post Audit: It ensures auditing of plan which was being performed by
professionals that will be analysed on the basis of their performance. Results and
15

outcomes have to be discussed and analysed for making qualitative changes in
further functions.
Role of investment appraisal techniques:
Importance of implicating such techniques helps personnel in identifying reliability
of projected plan in the future (Limon and Crozet, 2017). They can estimate costs and
implicate efforts for effective management of operations. Forecasting the future gains
through such projected plan will be beneficial for generating qualitative returns in proper
decision making.
Identifying and explaining the main methods of investment appraisal used in practice
To estimate the growth and succession of projected plan, there is need to
implicate investment appraisal techniques. However, there can be use of various
techniques such as:
 Accounting rate of return: It usually compares profit which was being expected
for making investment in capital projects (Accounting rate of return, 2018). For
example:
Accounting rate
of return
profit after tax 4500
Average
investment 8000
ARR 56%
 Net present value: It is an estimation for analysing present value of future cash
flows. Positive or negative outcomes will be analysed for determining the
profitability of operations (Li and Trutnevyte, 2017). Therefore, effectiveness of
such projected plan will have assistance in immersion of decision making. For
example:
year Cash
flow
Discounting
factors
Present
value
16

@10%
0 8000
1 3000 0.90909 2727.27
2 3200 0.82645 2644.63
3 3500 0.75131 2629.6
4 3200 0.68301 2185.64
Total present
value 10187.1
Less: Initial
investment 8000
Net present value 2187.15
 Payback period: It ascertains the length of investment period which will repay
top firm in the specific time. It mainly focuses on managing cash flows and net
profit for the period.
 Internal rate of return: This technique is used on planning capital budgeting for
the future cost estimations (Abdullah, Hassan and Kassim, 2017). It is the rate
which ascertains the proportionate amount of return that a firm will have through
respective investment.
year
Cash
flow
0 -8000
1 3000
2 3200
3 3500
4 3200
IRR 22%
 DCF: It is the technique which has been implicated by firms for valuation. It
estimates the future cash flows based past expenses and efficiency of firm.
17

CONCLUSION
On the basis of above report, it can be concluded that to develop industrial
efficiency and rise in financial health of an entity, it requires continuous audit of all
accounts. In this report, a study on 3 pharmaceutical firms i.e. GlaxoSmithKline,
Astrazenenca and Shire plc is made. They were analysed on their financial performance
in years 2014, 2015 and 2016. Further, they have been analysed on their efficiency,
liquidity, profitability and suggested to make necessary changes in business activities.
Report also included various investment appraisal techniques which were being used
for effective management and project plan. However, overall it can be concluded that
among all the 3 firms, AZ has effective profitability and favorable outcomes as
compared with GSK and Shire Plc.
18

REFERENCES
Books and Journals
Abdullah, A., Hassan, R. and Kassim, S., 2017. AN INVESTMENT APPRAISAL OF
INTERNATIONAL MARITIME ASSETS FOR MALAYSIAN ISLAMIC FINANCIAL
INSTITUTIONS-THE CASE FOR EQUITY. AL-SHAJARAH, pp.27-59.
Bader, A. and et.al., 2018. Capital Investment Appraisal Practices of Jordan Industrial
Companies: A Survey of Current Usage. International Research Journal of
Applied Finance. 9(4). pp.146-161.
Begg, I., 2017. Social investment and its discount rate. The Uses of Social Investment.
p.174.
Christ, K. L. and Burritt, R. L., 2017. Water management accounting: a framework for
corporate practice. Journal of cleaner production. 152. pp.379-386.
Li, F. G. and Trutnevyte, E., 2017. Investment appraisal of cost-optimal and near-
optimal pathways for the UK electricity sector transition to 2050. Applied
energy. 189. pp.89-109.
Limon, T. and Crozet, Y., 2017. Risk analysis and high speed rail projects in France:
introducing economic slowdown into appraisal methodologies. Transportation
Research Procedia. 25. pp.2824-2842.
Trinh, T. H. and Thao, L. T. N., 2017. Corporate Valuation Modeling for Strategic
Financial Decisions. Asian Economic and Financial Review. 7(12). p.1153.
Wijethilake, C., 2017. Proactive sustainability strategy and corporate sustainability
performance: The mediating effect of sustainability control systems. Journal of
environmental management. 196. pp.569-582.
Online
Accounting rate of return. 2018. [Online]. Available through :<
https://corporatefinanceinstitute.com/resources/knowledge/accounting/arr-
accounting-rate-of-return/>.
19

APPENDIX
Appendix 1
GlaxoSmithKline Financial analysis
Global ratios
Annual report/Consolidated 31/12/2016
th GBP
31/12/2015
th GBP
31/12/2014
th GBP
12 months
Unqual
IFRS
AR
12 months
Unqual
IFRS
AR
12 months
Unqual
IFRS
AR
Profitability ratios
ROE using P/L before tax (%) 39.07 118.56 60.13
ROCE using P/L before tax (%) 6.67 28.19 13.51
ROA using P/L before tax (%) 3.28 19.70 7.30
ROE using Net income (%) 18.38 94.86 55.84
ROCE using Net income (%) 4.11 22.93 12.73
ROA using Net income (%) 1.54 15.76 6.78
Profit margin (%) 6.85 43.37 12.73
Gross margin (%) 73.36 71.41 74.51
EBITDA margin (%) 14.62 11.62 22.57
EBIT margin (%) 7.64 2.58 15.46
Cash flow / Operating revenue (%) 10.20 43.73 18.94
Enterprise value / EBITDA (x) 21.86 27.51 15.45
Market cap / Cash flow from operations
(x)
11.81 26.03 12.93
Operational ratios
Net assets turnover (x) 0.71 0.61 0.85
Interest cover (x) 2.94 0.83 4.96
20

Stock turnover (x) 5.55 5.15 5.51
Collection period (days) 59 57 55
Credit period (days) 46 46 43
Export revenue / Operating revenue
(%)
n.a. n.a. n.a.
R&D expenses / Operating revenue (%) 12.35 13.88 14.00
Structure ratios
Current ratio (x) 0.88 1.24 1.10
Liquidity ratio (x) 0.61 0.89 0.79
Shareholders liquidity ratio (x) 0.14 0.29 0.22
Solvency ratio (Asset based) (%) 8.40 16.61 12.14
Solvency ratio (Liability based) (%) 9.17 19.92 13.82
Gearing (%) 714.27 355.78 461.89
Per employee ratios
Profit per employee (th) 19 104 30
Operating revenue per employee (th) 284 240 236
Costs of employees / Operating
revenue (%)
29.01 33.08 32.25
Average cost of employee (th) 82 79 76
Shareholders’ funds per employee (th) 50 88 50
Working capital per employee (th) 61 54 51
Total assets per employee (th) 592 528 412
Appendix 2
AstraZeneca Financial analysis
Global ratios
Annual report/Consolidated 31/12/2016
th GBP
31/12/2015
th GBP
31/12/2014
th GBP
12 months 12 months 12 months
21

Exchange rate: USD/GBP
Unqual
IFRS
AR
0.81288
Unqual
IFRS
AR
0.67481
Unqual
IFRS
AR
0.64070
Profitability ratios
ROE using P/L before tax (%) 21.31 16.58 6.34
ROCE using P/L before tax (%) 10.44 9.09 5.35
ROA using P/L before tax (%) 5.68 5.11 2.13
ROE using Net income (%) 20.99 15.26 6.28
ROCE using Net income (%) 10.33 8.55 5.32
ROA using Net income (%) 5.60 4.70 2.10
Profit margin (%) 15.08 12.10 4.56
Gross margin (%) 85.60 85.91 84.04
EBITDA margin (%) 25.77 23.41 20.68
EBIT margin (%) 15.76 12.17 8.67
Cash flow / Operating revenue (%) 24.86 22.39 16.51
Enterprise value / EBITDA (x) 13.18 15.95 16.54
Market cap / Cash flow from operations
(x)
16.66 26.02 12.73
Operational ratios
Net assets turnover (x) 0.50 0.56 0.66
Interest cover (x) 2.68 2.97 2.46
Stock turnover (x) 10.09 11.83 13.95
Collection period (days) 39 66 63
Credit period (days) 46 49 46
Export revenue / Operating revenue
(%)
n.a. n.a. n.a.
R&D expenses / Operating revenue (%) 24.66 23.11 19.89
22

Structure ratios
Current ratio (x) 0.87 1.08 0.96
Liquidity ratio (x) 0.72 0.93 0.85
Shareholders liquidity ratio (x) 0.55 0.69 0.91
Solvency ratio (Asset based) (%) 26.66 30.82 33.53
Solvency ratio (Liability based) (%) 36.35 44.55 50.44
Gearing (%) 194.76 145.16 115.68
Per employee ratios
Profit per employee (th) 48 34 14
Operating revenue per employee (th) 321 278 305
Costs of employees / Operating
revenue (%)
26.68 24.17 22.96
Average cost of employee (th) 86 67 70
Shareholders’ funds per employee (th) 227 203 219
Working capital per employee (th) 26 36 36
Total assets per employee (th) 851 659 653
Appendix 3
Shire plc financial analysis
Global ratios
Annual report/Consolidated 31/12/2016
th GBP
31/12/2015
th GBP
31/12/2014
th GBP
Exchange rate: USD/GBP
12 months
Unqual
Local
GAAP
AR
12 months
Unqual
Local
GAAP
AR
12 months
Unqual
Local
GAAP
AR
23

0.81288 0.67481 0.64070
Profitability ratios
ROE using P/L before tax (%) 1.68 14.10 37.49
ROCE using P/L before tax (%) 1.61 11.06 30.90
ROA using P/L before tax (%) 0.73 8.34 23.82
ROE using Net income (%) 1.13 13.26 39.31
ROCE using Net income (%) 1.34 10.42 32.39
ROA using Net income (%) 0.49 7.85 24.98
Profit margin (%) 4.27 21.58 53.83
Gross margin (%) 69.16 94.83 84.71
EBITDA margin (%) 21.25 41.89 35.27
EBIT margin (%) 8.30 21.94 25.36
Cash flow / Operating revenue (%) 15.82 40.25 66.35
Enterprise value / EBITDA (x) 30.77 15.85 18.59
Market cap / Cash flow from operations
(x)
19.60 17.65 9.87
Operational ratios
Net assets turnover (x) 0.19 0.50 0.57
Interest cover (x) 2.02 33.86 49.68
Stock turnover (x) 3.20 10.11 11.07
Collection period (days) 83 67 62
Credit period (days) 29 26 15
Export revenue / Operating revenue
(%)
n.a. n.a. n.a.
R&D expenses / Operating revenue (%) 12.63 24.36 14.13
Structure ratios
Current ratio (x) 0.97 0.61 1.72
24

Liquidity ratio (x) 0.51 0.44 1.54
Shareholders liquidity ratio (x) 0.95 3.20 4.45
Solvency ratio (Asset based) (%) 43.18 59.18 63.55
Solvency ratio (Liability based) (%) 76.00 n.s. n.s.
Gearing (%) 115.42 46.66 32.29
Per employee ratios
Profit per employee (th) 17 169 415
Operating revenue per employee (th) 388 781 771
Costs of employees / Operating
revenue (%)
2.80 1.56 1.61
Average cost of employee (th) 11 12 12
Shareholders’ funds per employee (th) 984 1,196 1,107
Working capital per employee (th) 179 167 170
Total assets per employee (th) 2,279 2,020 1,741
Rankin
g 2016 2015 2014
Global
ratios
GlaxoSmi
thKline
Astraz
enenca
S
hir
e
pl
c
GlaxoSmi
thKline
Astraz
enenca
S
hir
e
pl
c
GlaxoSmi
thKline
Astraz
enenca
S
hir
e
pl
c
Profita
bility
ratios
ROE
using
P/L
before
1 2 3 1 2 3 1 3 2
25

tax (%)
ROCE
using
P/L
before
tax (%)
2 1 3 1 3 2 2 3 1
ROA
using
P/L
before
tax (%)
2 1 3 1 3 2 2 3 1
ROE
using
Net
income
(%)
2 1 3 1 2 3 1 3 2
ROCE
using
Net
income
(%)
2 1 3 1 3 2 2 3 1
ROA
using
Net
income
(%)
2 1 3 1 3 2 2 3 1
Profit
margin
(%)
2 1 3 1 3 2 2 3 1
Gross
margin
2 1 3 3 2 1 3 2 1
26

(%)
EBITD
A
margin
(%)
3 1 2 3 2 1 2 3 1
EBIT
margin
(%)
3 1 2 3 2 1 2 3 1
Cash
flow /
Operati
ng
revenu
e (%)
3 1 2 1 3 2 2 3 1
Enterpr
ise
value /
EBITD
A (x)
2 3 1 1 2 3 3 2 1
Market
cap /
Cash
flow
from
operati
ons (x)
3 2 1 1 2 3 1 2 3
Operat
ional
ratios
Net 1 2 3 1 2 3 1 2 3
27

assets
turnove
r (x)
Interest
cover
(x)
1 2 3 3 2 1 2 3 1
Stock
turnove
r (x)
2 1 3 3 1 2 3 1 2
Collecti
on
period
(days)
2 3 1 3 2 1 3 1 2
Credit
period
(days)
1 1 2 2 1 3 2 1 3
Export
revenu
e /
Operati
ng
revenu
e (%)
n.a. n.a. n.
a.
n.a. n.a. n.
a.
n.a. n.a. n.
a.
R&D
expens
es /
Operati
ng
revenu
e (%)
3 1 2 3 2 1 3 1 2
28

Struct
ure
ratios
Current
ratio (x)
2 3 1 1 2 3 2 3 1
Liquidit
y ratio
(x)
2 1 3 2 1 3 3 2 1
Shareh
olders
liquidity
ratio (x)
3 2 1 3 2 1 3 2 1
Solven
cy ratio
(Asset
based)
(%)
3 2 1 3 2 1 3 2 1
Solven
cy ratio
(Liabilit
y
based)
(%)
3 2 1 2 1 3 2 1 3
Gearin
g (%)
1 2 3 1 2 3 1 2 3
Per
emplo
yee
ratios
Profit 2 1 3 2 3 1 2 3 1
29