Running head: WEEK 5 Financial Ratios Analysis
Week 5 Financial Ratios Analysis
University of Phoenix
Business Systems I
BSA/500
This is a brief analysis and comparison of select financial ratios of four companies: two in the manufacturing and two in the retail food industries. The financial ratios analyzed are the current ratio, debt ratio, profit margin, return on assets. I should point out that I used the most recent financial reports provided for each company, although in some cases they may not represent the same years. All dollar figures are in thousands. Riordan Manufacturing, based in San Diego, California, is a leading manufacturer in the plastics injection molding industry. Riordan’s most recent financial reports
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Finance. (2010). Winn-Dixie Stores, Inc. Retrieved from http://finance.yahoo.com/q?s=WINN
Riordan Manufacturing, Inc. | Income Statement
For the 12 months ending September 30, 2005 | | | 2005 | 2004 | | Sales | $50,823,685 | $46,044,288 | Direct Cost of Goods Sold | $42,037,624 | $37,480,050 | Gross Margin | $8,786,061 | $8,564,238 | | Operating Expenses | | Sales, Marketing & Other | $1,012,974 | $920,886 | Depreciation | $343,445 | $349,937 | Quality Assurance | $1,139,688 | $1,095,854 | Research & Development | $911,676 | $828,797 | General & Administrative | $1,706,953 | $1,524,066 | Machining & Systems | $628,505 | $598,576 | Total Operating Expenses | $5,743,241 | $5,318,115 | Profit Before Interest & Taxes | $3,042,820 | $3,246,122 | | Non-Operating Expenses | | Interest Expense | $143,175 | $230,221 | Taxes | $943,274 | $1,025,406 | Total Non-Operating Expenses | $1,086,449 | $1,255,628 | Net Profit After Taxes | $1,956,371 | $1,990,495 | |
Riordan Manufacturing, Inc. | Consolidated Balance Sheet | | | Fiscal Year Ending
September 30th | | 2005 | 2004 | | Assets | | Current Assets | | Cash | | $305,563 | $357,216 | Accounts Receivable | | $6,062,838 | $5,657,216 | Current Portion of Notes Receivable | | $70,825 | $117,888 | Inventories | |
Riordan Manufacturing is an international plastics manufacturer that currently employs 550 people with projected annual earnings totaling approximately $46 million. The company is completely owned by Riordan Industries which is a Fortune 1000 enterprise with revenues of up to $1 billion. The company’s merchandises consists of plastic beverage containers that are produced at its plant in Albany, Georgia; custom plastic parts are manufactured at its plant in Pontiac, Michigan; and plastic fan parts are created at its facilities in Hangzhou, China ("Riordan Manufacturing", 2013).
Riordan Manufacturing is a worldwide fortune 1000 enterprise manufacturer of plastics with sole ownership by Riordan Manufacturing Industries. Custom plastic product parts akin to beverage containers and fan parts help generate company revenue of one billion. Riordan development and research carries out at the company’s R&D headquarters location in San Jose, California. Three additional Riordan production plants include locations in Pontiac, Michigan and Albany, Georgia with an international joint venture in Hang Zhou, China. Riordan employs a mere approximate of 550 people with company projections at $46 million a
Riordan Manufacturing is a global plastics manufacturer with facilities located in: Albany Georgia, Pontiac Michigan, Hangzhou China, with a research and development department located in San Jose California. This establishment has produced an annual earning of forty-six million dollars. Riordan Industries, which is the sole owner of Riordan Manufacturing, is a Fortune 1000 enterprise with revenues in excess of one-billion dollars.
Riordan Industries, Inc. is a successful Fortune 1000 enterprise with revenues in excess of $1 billion. Our corporate headquarters is in San Jose, California; the manufacturing plants are in Albany, Georgia, Pontiac, Michigan, and Hangzhou, China, which is a joint venture.
The liquidity, profitability, and solvency ratios reveal some interesting points about Kudler Fine Food’s financial position. The liquidity ratios revealed that during 2002 and 2003, Kudler was having no trouble paying short-term debt. However, the current and acid-test (quick) ratios showed that during 2003 Kudler had an excess amount of cash that they were not investing properly. These ratios also showed that Kudler was collecting receivables and selling average inventory very quickly. The profitability ratios revealed that during 2002 and 2003, Kudler was using assets efficiently and making a decent profit. The profit margin ratio showed that during 2002 Kudler made a profit of four cents per dollar, and during 2003 they made a profit of roughly six cents per dollar. In addition, the return on assets ratio (which is also a profitability ratio) showed that Kudler utilized their assets efficiently enough to turn a profit. The solvency ratio used, which was the debt to total assets ratio, showed that during 2002 and 2003 Kudler only had around a quarter of their assets financed in debt. All of these ratios show that Kudler was a fairly strong company financially during 2002 and 2003. When trying to figure out how successful Kudler Fine Foods is, it is critical to review all financial statements. By using the horizontal and vertical analysis and the determining ratio calculations the profitability, liquidity, and solvency are figured. A specific
Riordan Manufacturing is a global producer and manufacturer in the global plastics industries and has about 550 people that have a projected annual earning of over $46 million dollars. Riordan has a manufacturing plant located in Albany, GA that is capable of producing plastic beverage containers, another plant that is located in Pontiac MI that is capable of producing custom plastic parts, and another plant located in Hangzhou, China that produces plastic fan parts. The corporate offices and research and development department of Riordan are located in San Jose, California. Riordan Manufacturing is part of Riordan industries Inc.
There is a essential use and limitations of financial ratio analysis, One must keep in mind the following issues when using financial ratios: One of the most important reasons for using financial ratio analysis is comparability and for this, a reference point is required. Usually, financial ratios are compared to historical ratios of the business itself, competitor’s financial ratios or the overall ratios of the industry in question. Performance may be adjudged as against organizational goals or forecasts. A number of ratios must be analyzed together to get a true and reliable picture of the financial performance of the business. Relying on each ratio
Industry averages and financial ratio reports determine the financial health of an organization. Solvent, efficiency, and profitability are compared by key financial indicators and ratios that measure several companies within the same industry. The publicly traded company chosen by Team A is ExxonMobil. “The largest publicly traded international oil and gas company in the world. ExxonMobil makes products that drive modern transportation, power cities, lubricate industry, and provide petrochemical building blocks that lead to
Before beginning an analysis of a company it is necessary to have a complete set of financial statements, preferably for the pas few years so that historical trends can be obtained. Ratios are a way for anyone to get an idea of the financial performance of a company by using the information contained in the financial statements. Ratios are grouped into four basic categories, liquidity, activity, profitability, and financial leverage. This document will use a variety of these ratios to analyze the firm, Sample Company, as of December 31,2000.
4. How useful are financial ratios in evaluating the current performance of each of the two
This paper deals with the question of how a ratio analysis can help in determining the true value of a company. Therefore a critical ratio analysis of Morrisons, a supermarket which is listed on the London Stock Exchange will be done and then compared with the William Jackson Food Group, another supermarket but a private company in order to figure out if there are any differences or similarities which can help to measure the performance of the companies. At least recommendations of the usefulness of this research will be given
Ratios of ten companies are presented in this study. The companies are all headquartered in the United States and the financial statements are the most recent annual financials for the respective fiscal years ending in 1999 or 2000.
The following financial report provides an analysis of the financial ratios of David Jones with its close competitor in the retail sector, Myer. The financial ratios analyzed include profitability ratios, leverage ratios, efficiency ratios and market ratios for the two companies. The analysis utilizes individual company time-series analysis as well as industry cross-sectional analysis with the aim of determining the competitiveness of David Jones relative to its close competitor Myer.
Ratios describe the various relationships among accounts in the balance sheet and income statement. Financial ratios are important and helpful gauges of how an organization is functioning. An organization’s financial health, potential revenue, and even possible bankruptcy can be garnered from financial ratios. Information derived from financial statements is used to calculate most ratios and make projections. “Ratios help investors and lenders determine the risk associated with lending or investing funds in an organization” (GE Financial Healthcare Services, 2003, para 1). According to Finkler and Ward (2006), “the key to interpretation of ratios is benchmarks. Without a basis for comparison, it is
Part 1 : Examine and analyze the financial ratios for eight pairs of unidentified companies and match the description of the company with the financial profile derived from the financial ratios.