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Financial Report Analysis - Assignment Example
Finance & Accounting
Pages 4 (1004 words)
Financial Report Analysis Name Institution Financial Report Analysis Executive summary Rolls-Royce is a global company providing integrated power solutions for customers in civil and defense aerospace, marine and energy markets. In 2012, Rolls-Royce continued to obtain underlying profits as it has continuously done every year for the past decade…
The Group’s performance in 2012 is testament to the strength of their strategies, the quality of their technologies and the ability and determination of their employees and members. They made a final payment to shareholders of 11.9 pence per share bringing the full year payment to 19.5 pence per share, an increase of 11 per cent from the year 2011. Ratio analysis is very important to all companies as it gives an insight on the hidden features of the company performance. Rolls-Royce Company seems to be performing very well for the past five years and more so for the reports provided at the end of February 2013 (GROPPELLI, ANGELICO, EHSAN NIKBAKHT ,2000 pg. 43). All of the ratios calculated including profitability, liquidity, gearing and returns ratios exhibits the company as being on the right track in terms of growth. The returns on investment and returns on capital employed have more than doubled in a period of one year. This is a clear indication that the shareholders’ funds are being employed in the right manner. On the profitability ratios, all of them have experienced growth and improvement in the last one year while maintaining a relatively constant growth in expenses which gives a good report on the company. the company is also very liquid as exhibited by the positivity and the growth of the liquidity ratios. ...
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