Profitability Analysis
BAE Business report on Woolworths Limited
Student name: Can CAO (Phil) Student number: 32174 Class: BAE 5 Date: 18 June 2013 Word count: 1307
Table of contents
Executive summary--------------------------------------------------------1
1 Introduction----------------------------------------------------------------2
2 Evaluation of ethical behavior---------------------------------------3
3 Evaluation of profitability analysis---------------------------------4
4 Conclusion and recommendation----------------------------------8
References--------------------------------------------------------------------9
Executive summary
This report provides an evaluation of Woolworths in respect of ethical behavior and profitability analysis to fulfill an investor’s ethical requirement. The investigation indicates that Woolworths has earned a particular portion of revenues from gambling machines, which are provided to addicted problem gamblers. This unethical behavior has affected not just the company's reputation but its survivable profitability as well. The methodology of profitability analysis combined profit margin analysis with sales growth rates analysis. Results of data analysed show that Woolworths maintains a small and gradual increase in profit margin during the period from 2008 to 2012. In addition, the growth rates of sales have seen a decline during the same period. Based on the evaluation offered above, this report recommended that the ethical investor should not invest in Woolworths due to its unethical behavior and non-ideal financial performance.
1. Introduction
The purpose of this report is to evaluate Woolworths to help an ethical investor to decide whether or not to invest in Woolworths. The evaluation of Woolworths includes not only the ethical behavior but
Student name: Can CAO (Phil) Student number: 32174 Class: BAE 5 Date: 18 June 2013 Word count: 1307
Table of contents
Executive summary--------------------------------------------------------1
1 Introduction----------------------------------------------------------------2
2 Evaluation of ethical behavior---------------------------------------3
3 Evaluation of profitability analysis---------------------------------4
4 Conclusion and recommendation----------------------------------8
References--------------------------------------------------------------------9
Executive summary
This report provides an evaluation of Woolworths in respect of ethical behavior and profitability analysis to fulfill an investor’s ethical requirement. The investigation indicates that Woolworths has earned a particular portion of revenues from gambling machines, which are provided to addicted problem gamblers. This unethical behavior has affected not just the company's reputation but its survivable profitability as well. The methodology of profitability analysis combined profit margin analysis with sales growth rates analysis. Results of data analysed show that Woolworths maintains a small and gradual increase in profit margin during the period from 2008 to 2012. In addition, the growth rates of sales have seen a decline during the same period. Based on the evaluation offered above, this report recommended that the ethical investor should not invest in Woolworths due to its unethical behavior and non-ideal financial performance.
1. Introduction
The purpose of this report is to evaluate Woolworths to help an ethical investor to decide whether or not to invest in Woolworths. The evaluation of Woolworths includes not only the ethical behavior but
References: Crane, A & Matten, D 2010, Corporate social responsibility, 3rd edn, SAGE Publication Ltd, Los Angeles. Hoggett, J, Edwards, L, Medlin, J & Tilling, M 2009, Financial accounting, 7th edn, John wiley & Sons Australia Ltd, Milton. Kendall, R 2012, Woolworths’ shareholders asked to limit gambling damage, ethical investor, viewed 4 June 2013, <http://www.ethicalinvestor.com.au/index.php?option=com_content&task=view&id=4539&Ite mid=402>. Ockenden, W 2012, GetUp! loses bid to force Woolworths pokies vote, ABC NEWS, viewed 5 June 2013, <http://www.abc.net.au/news/2012-07-06/getup-loses-woolworths-pokies-case/4115514>. Peatling, S 2012, Woolworths ' pokies 'target low-earners ', The Age, viewed 5 June 2013, <http://www.theage.com.au/national/woolworths-pokies-target-lowearners-20120929-26sem.html>. Willingham, R 2012, Woolworths shareholders reject pokies bet limit, viewed 9 June 2013, <http://www.smh.com.au/opinion/political-news/woolworths-shareholders-reject-pokies-bet-limit-20121122-29rhh.html>. Woolworths Limited 2012, annual report, Woolworths limited, viewed 2 June 2013, <http://www.woolworthslimited.com.au/annualreport/2012/pdf/WW_AR12_FinReport.pdf>.