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Accounting Analysis Report

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Accounting Analysis Report
1. Step One
(a)
Net finance costs = finance expenses – interest revenue
EBIT = Profit before tax + Net finance costs 2012
2011
2010
2009

$ '000
$ '000
$ '000
$ '000
Revenue
422291
423791
381219
347547
Sales
418981
411652
372120
343078
Cost of sales
-175843
-171256
-164789
-145275
Gross Profit
246448
252535
216430
202272
Finance expenses
563
787
597
118
Interest revenue
441
371
195
606
Net finance cost
122
416
402
-488
Profit before income Tax
20495
22690
17459
21888
Earnings before interest and tax (EBIT)
20617
23106
17861
21400
Net Profit
16103
18218
12331
15649
Trend Analysis
2012
2011
2010
2009
Revenue
121.5
121.9
109.7
100
Sales
122.1
120.0
108.5
100
Gross Profit
121.0
117.9
113.4
100
Earnings before interest and tax (EBIT)
121.8
124.8
107.0
100
Net Profit
477.1
666.9
505.9
100

(b)
Based on this analysis, profits have been increased over the period.

2. Step Two
(a)
Absolute $000’s figures
2012
2011
2010
2009
2008
Sales Revenue
418981
411652
372120
343078

Gross Profit
246448
252535
216430
202272

Net Profit
16103
18218
12331
15649

EBIT
20617
23106
17861
21400

Total Assets
146282
149280
129194
141668
108512
Total Equity
94629
91724
84792
74981
69989
Return on Equity
17.3%
20.6%
15.4%
21.6%

Return on Assets
14.0%
16.6%
13.2%
17.1%

Gross Profit Margin
58.8%
61.3%
58.2%
59.0%

Profit Margin
4.9%
5.6%
4.8%
6.2%

Net Profit Margin
3.8%
4.4%
3.3%
4.6%

Detailed calculation on Appendix 2 (a)
(b)
Ratios
2012
2011
2010
2009
Return on Equity
17.3%
20.6%
15.4%
21.6%
Return on Assets
14.0%
16.6%
13.2%
17.1%
Gross Profit Margin
58.8%
61.3%
58.2%
59.0%
Profit Margin
4.9%
5.6%
4.8%
6.2%
Net Profit Margin
3.8%
4.4%
3.3%
4.6%
Trend Analysis
2012
2011
2010
2009
Return on Equity
80.1
95.6
71.5
100
Return on Assets
81.5
97.0


References: P332-p333, Accounting: business reporting for decision making, 4E Study Guide by Jacqueline Birt Dividend payout ratio http://www.dividendpayoutratio.org/Good-Dividend-Payout-Ratio.html Price Earnings ratio http://www.theoptionsguide.com/price-to-earnings-ratio.aspx
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