Financial Management and Control - Kingspan
Financial Management and Control Kingspan Assignment
6th December 2012
Contents
Introduction 4
1. Profitability Ratios 4
1.1 Gross Profit Ratio 4
1.2 Net Profit Ratio 4
1.3 Return on Capital Employed (ROCE) 4
2. Liquidity Ratios 5
2.1 Current Ratio 5
2.2 Quick Ratio/Acid Test Ratio 5
3. Efficiency Ratios 6
3.1 Debtors Days 6
3.2 Creditors Days 6
3.3 Inventory Turnover Days 6
4. Gearing Ratios 7
4.1 Gearing Ratio 7
4.2 Debt to Equity Ratio 7
4.3 Interest Cover 7
5. Investment Ratios 8
5.1 Earnings per Share 8
5.2 Price Earnings Ratio 8
5.3 Dividend Cover 8
6. Sources of Finance 9
6.1 Debt capital: 9
6.2 Lease and Hire Purchase 9
6.3 Share Capital 9
6.4 Creditor & Debtors 10
6.5 Reducing stock levels 10
7. Conclusion 10
7. Appendices 11
7.1 Appendix 1 11
7.2 Appendix 2 12
Introduction
Below are the ratio findings based on Kingspan PLC’s annual report year ended 31st December 2010. The ratios are calculated for both 2010 and 2009.
The ratios are as follows:
1. Profitability Ratios
1.1 Gross Profit Ratio 2010 2009 Gross Profit 333,694 x 100% = 27.96% 308,913 x 100% = 27.45%
Sales Revenue 1,193,215 1,125,523
There is a slightly higher Gross Profit in 2010. Kingspan are now holding onto .51% more of each euro of sales then they were in 2009. This is due to the increase in sales.
1.2 Net Profit Ratio 2010 2009 Net Profit (before Int & Tax) 67,405 x 100% = 5.65% 62,659 x 100% = 5.57%
Sales Revenue 1,193,215 1,125,523
There is a slight increase of.08% in 2010 compared to 2009. If going by the gross profit ratio this should have been higher; this indicates that they need to manage their expenses more efficiently thus increasing their net profit.
1.3 Return on Capital Employed (ROCE) 2010 2009 Net Profit (before Int & Tax) 67,405 x 100% = 7.65% 62,659 x 100% = 7.97%
Capital Employed (W1) 880,616 786,676
Kingspan
6th December 2012
Contents
Introduction 4
1. Profitability Ratios 4
1.1 Gross Profit Ratio 4
1.2 Net Profit Ratio 4
1.3 Return on Capital Employed (ROCE) 4
2. Liquidity Ratios 5
2.1 Current Ratio 5
2.2 Quick Ratio/Acid Test Ratio 5
3. Efficiency Ratios 6
3.1 Debtors Days 6
3.2 Creditors Days 6
3.3 Inventory Turnover Days 6
4. Gearing Ratios 7
4.1 Gearing Ratio 7
4.2 Debt to Equity Ratio 7
4.3 Interest Cover 7
5. Investment Ratios 8
5.1 Earnings per Share 8
5.2 Price Earnings Ratio 8
5.3 Dividend Cover 8
6. Sources of Finance 9
6.1 Debt capital: 9
6.2 Lease and Hire Purchase 9
6.3 Share Capital 9
6.4 Creditor & Debtors 10
6.5 Reducing stock levels 10
7. Conclusion 10
7. Appendices 11
7.1 Appendix 1 11
7.2 Appendix 2 12
Introduction
Below are the ratio findings based on Kingspan PLC’s annual report year ended 31st December 2010. The ratios are calculated for both 2010 and 2009.
The ratios are as follows:
1. Profitability Ratios
1.1 Gross Profit Ratio 2010 2009 Gross Profit 333,694 x 100% = 27.96% 308,913 x 100% = 27.45%
Sales Revenue 1,193,215 1,125,523
There is a slightly higher Gross Profit in 2010. Kingspan are now holding onto .51% more of each euro of sales then they were in 2009. This is due to the increase in sales.
1.2 Net Profit Ratio 2010 2009 Net Profit (before Int & Tax) 67,405 x 100% = 5.65% 62,659 x 100% = 5.57%
Sales Revenue 1,193,215 1,125,523
There is a slight increase of.08% in 2010 compared to 2009. If going by the gross profit ratio this should have been higher; this indicates that they need to manage their expenses more efficiently thus increasing their net profit.
1.3 Return on Capital Employed (ROCE) 2010 2009 Net Profit (before Int & Tax) 67,405 x 100% = 7.65% 62,659 x 100% = 7.97%
Capital Employed (W1) 880,616 786,676
Kingspan