The working capital ratio measures the difference between the total current assets and current liabilities. My analysis of Boeing’s working capital ratio has shown a steady increase from $2.4 million in 2009 to $8.5 million in 2011. This is a positive indicator that the company has the ability to pay it liabilities. Boeing has a massive $374 billion backlog, amounting to five times 2011 sales. Such strong revenue visibility should allow the firm to adjust production rates and ride out economic downturns (Boeing website 2012).
According to Readyratios.com, the Debt to Equity ratio should be normally 1,5-2,0 or smaller. The data in the excel table extracted from the Barry Callebaut Annual report concludes that a company is doing well in terms of its liabilities and equity proportion. Despite a gradual increase in the ratio from 64,9% in 2011 up to 100,7% in 2014, the company’s ratio is currently declining, and is at 74,3% in 2016 which shows that the company is financed more from its own financial sources rather than by those of creditors’. The Payout ratio gives information about the percentage of net income that is used to pay the dividends. Since Barry Callebaut is a large company, its payout ratio is quite high: more than 30%.
The debt collection period of the Campco Ltd is good when compared to past 4 years. The solvency ratio of the company is not good in the last 5 years, but it has been increased in the previous year by 0.2 times. The average cash to sales ratio is 0.018 times and which indicates that only 18% of sales has been maintained as cash with the business. The cash management techniques of the business is not functioning well in the organization, as its having less amount of cash than the assets of the organization. The operating profit of the Campco Ltd is increased during the year 2013-14 by 1.22% than the previous year 2012-13.
However, return on investment (ROI) remains at 19.3% for 2010 and 2009 year and return on assets (ROA) has increased 0.5% from 8.4% to 8.9% respectively. The financial figure shows that the company improves performance in 2010 despite economic condition all over the globe. The biggest contributor of this success is the international market. It contributed more than $100 billion of net sales in the consolidated total. This was the first time the international stores reached the billion dollar figure.
When there is high gearing, the profits available to shareholders are reduced due to interest paid on loans. The costs of the business can increase as well if the interest rates rise. However, high gearing is not necessarily bad. It can signify that the firm is seeking expansion plans, and have taken the chance to capitalise by borrowing at low rates. As for low gearing, more profits are distributed to shareholders due to lower interest bills.
The corresponding quick ratios of Marriot international were 0.42, 0.58, 0.38, 0.40 and 0.45 respectively. The Marriot ROIs displayed increasing trend from 2010 however ended up much lower than that of IHG in 2013 (Block and Hirt, 1978). The 2013 and prior period declinations are attributable to the negative impacts of economic down turn, high costs of operations and high competitions. Hence, it can be stated that quick term solvency of both the companies have decreased in 2013, IHG
c) Financial Situation Cathay Pacific is currently at a stable, profit-earning financial situation. According to the interim report 2015, its net equity ratio is 0.81 which slightly decreased 0.04 times compare to 2014. Moreover, the profit after tax is HK$955 million which recorded an increase for more than HK$5 million compare to the previous year. The financial figures showed Cathay Pacific is strong and firm in financial conditions which can provide a definite support in expansion of the business while it has sufficient resources to employ more talents in the future. However, due to the oil hedging, Cathay Pacific is currently paying for a higher price for fuel compare to other airline companies which may weaken the possibilities to use price discounts as to attract passengers.
The company’s performance met the targets set out in the prospectus to match the top rung corporations in the Malaysia corporate scene. The pre-tax profits not only recorded strong growth as it had in the previous 3 years, but has breached the $500 million mark for the first time. This was the result of a combination factors such as strong economy, a communications conscious society, sound management of operations and financial affairs. The reorganization exercise which made customer and market orientation the hallmark of the company is continued into the year. The public offer of 470.5 million Telekom Malaysia shares at $5 per share and the listing of paid up ordinary shares of 1970.5 million on the KLSE marked the culmination of the company’s privatization exercise.
Which is very good sign for the company as the day to day activities are inceasing. If we see the investing activies then we can interpret that the company is investing more as compared to the last two years may be in assets or any thing else. While in the financing cash is going out of the company for the financial purpose where as in the year 2013 and 2012 cash was coming in the company may be in the form of loan or redemption. If we see the operating profit of a company after tax then it has been increased from 2010-11 to 2012-13 which was Rs. 404.36 cr.
• Pay a high interest on the bank loan for the purchase of aircraft • And also paying extreme-overdue salaries only for the selected management department. Although Malaysia Airlines MAS does not show the best performance, but they still paid a high salaries to them regardless of the problems that MAS has faced. Under the various initiatives, launched together with the business turnaround plan, Malaysia Airlines switched from losses to profitability between financial year 2006 and financial year 2007. When the business turnaround plan came to an end, the airline posted a record profit of RM853 million in 2007, ending a series of losses since 2005. Two years after Idris Jala resignation, MAS is having the most historic losses in the airline industry, which is a shocking loss of RM2.5 billion in 2011.