UNIT PDM 101
FINANCIAL MANAGEMENT
FINANCIAL ANALYSIS OF ORICA
Due Date: 2 December, 2013
Name: Matt Toon
Student ID: 864166
All answers have been rounded up to two decimal places.
TABLE OF CONTENTS
1.0 QUESTION 1 3
1.1 Current ratio 3
1.2 Quick asset ratio 4
1.3 Average inventory turnover 5
1.4 Average collection period 6
1.5 Cash flow ratio 7
1.6 Equity ratio 8
1.7 Debt ratio 9
1.8 Interest cover 10
1.9 Fixed charges cover 11
1.10 Return on assets 12
1.11 Return on sales 13
1.12 Return on Equity 14
1.13 Sales Turnover 15
1.14 Earnings per share 16
1.15 Price/earnings ratio 17
1.16 Dividend yield 18
1.17 Price/book ratio 20
1.18 Summary of Calculated Ratios 21
2.0 QUESTION 2 22
2.1 Short Term Financial Position 24
2.2 Long Term Financial Position 27
2.3 Operating Profitability 30
2.4 Return to Owners 32
2.5 Ratios incorporating share prices 34
2.6 CONCLUSIONS 35
2.7 Acknowledgements 36
QUESTION 1
Calculate the following ratios for 2011 and 2012:
Current ratio
2011
Current assets = $106,594,000.00
Current Liabilities = $53,592,000.00
Answer
Current (working capital) ratio = 1.99:1
2012
Current assets = $111,784,000.00
Current Liabilities = $48,593,000.00
Answer
Current (working capital) ratio = 2.30:1
*
Quick asset ratio
*
2003
Current assets = $106,594,000.00
Stock and prepayments = $31,661,000.00
Current Liabilities = $53,592,000.00
Bank overdraft = $0.00
Answer
Quick asset ratio = 1.40:1
2004
Current assets = $111,784,000.00
Stock and prepayments = $34,241,000.00
Current Liabilities = $48,593,000.00
Bank overdraft = $0.00
Answer
Quick asset ratio = 1.60:1
Average inventory turnover
2003
2002 inventory = $30,015,000.00
2003 inventory = $31,661,000.00
Cost of goods sold = Total revenue – Profit from ordinary activities (before income tax and amortisation of goodwill)
Cost of goods sold = $360,588,000.00 – 19,873,000.00
Cost of...