Ratio Analysis Essay Example | Topics and Well Written Essays - 1500 words

symmetry Analysis - Essay ExampleThe paper characters Profitability, efficiency, liquidity and sh areholder ratios as the basic tools. The more complex tools like IRR, WACC etc are ignored to keep the analysis simple and meaningful. In addition, the paper identifies the Key Performance indicators (KPIs) of the company and noblelights the basic steps taken by the company to come across the KPI targets. The companys current years results with respect to the KPI targets are also discussed and highlighted. To Board of Directors of Go Ahead group Plc. From Robert Frost, Accountant Re Ratio Analysis and KPI discussion DateFebruary 25, 2013 With regard to your concerning the analysis of organizational monetary performance and position, I would like to present this report which summarized, analyzes and properly interprets the basic financial ratios of the company. I hope it will be of great help for you to understand and target the areas where improvement is required and further take st rategic actions to improve and curb the strong growth areas of our business. Introduction Go Ahead Group Plc is a leading company in the public transport industry. The company has a high regard in the industry for having social, financial and environmental aims working together at its core strategic plans. The company aims at providing transportation in the urban and other areas with less delays, high environmental targets and social responsibility. The company has captured the highest share of the transportation industry by focusing on the KPIs it has set. The company has also alter its efficiency and effectiveness in operations by reducing waiting times, increasing punctuality, spending more on security and comfort of the people and accessibility of their services with proper schedules and plans. The companys financial analysis and discussion on its core competences is given below. Ratio Analysis Current & Previous form The Return on Net Assets ratio reveals that the company i s using the net assets very efficiently in carrying out its operations. The company is employing and making higher than evaluate profits by properly allocating the assets. The Return on Shareholders Funds in 2011 and 2012 shows significant returns to meet the companys profit demands. Moreover, it completely satisfies the shareholders on the use and allocation of their shareholdings as per the returns generated in the two years under consideration. The operating profit margin, although slightly lower than previous year, is qualified. Moreover, if the one-off benefit is eliminated, the company shows an increase of ?8.1m in operating profit. Hence, the actual operating profit margin is higher than the previous year further showing a strengthened financial position of the company. The ROCE of 17.6% and 19.2% is satisfactory in 2012 and 2011 respectively (Appendix 1). The slight reduction is not worrying, yet it should be stopped from recurrence to maintain the position that the compan y holds. The net asset