TELSTRA Student name – ID FIN600 TX YYYY Assignment – Company Executive Summary Contents Page Number 1 Introduction - Background and Business 2 2 Company Analysis - Current Financial performance,...

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Hello, the assessment is to be made on company rio tinto. All the details are given in the case study report. Please go through it and make all the requirements complete. The required blank layout are attached for reference purpose.




TELSTRA Student name – ID FIN600 TX YYYY Assignment – Company Executive Summary Contents Page Number 1 Introduction - Background and Business 2 2 Company Analysis - Current Financial performance, economic outlook 3 Ratio Analysis 3.1 Profitability ratios 3.2 Efficiency ratios 3.3 Liquidity ratios 3.4 Gearing ratios 4 Recommendations and overall assessment 5 References/Bibliography Appendices – attached Excel Spreadsheet 1 Introduction 1.1 Background and Business Discussion 2 Company Analysis 2.1 Financial statements, Current Financial performance, economic outlook Discussion 3 Ratio Analysis 3.1 Profitability and Market ratios (see appendix for calculations) YYYY YYYY Industry average Return on assets % % % Return on equity % % % Net profit margin % % % Gross profit margin % % % Net Interest Income % % % Expense ratio/Cost to Income ratio % % % Cash return on sales % % % Earnings per share $ per share $ per share $ Price earnings ratio times times times Earnings yield % % % Dividends per share $ $ $ Discussion 3.3 Efficiency ratios (see appendix for calculations) YYYY YYYY Industry average Asset turnover times times times Cash return on assets times times times Fixed Asset turnover times times times Discussion 3.3 Liquidity ratios (see appendix for calculations) YYYY YYYY Industry average Current ratio xx:1 xx:1 xx:1 Quick ratio xx:1 xx:1 xx:1 Receivables turnover Days Days Days Average collection period Days Days Days Discussion 3.4 Gearing ratios (see appendix for calculations) YYYY YYYY Industry average Debt to equity ratio % % % Debt ratio % % % Equity ratio % % % Cash debt coverage % % % Interest cover ratio times times Times Discussion 4 Recommendations and overall assessment Discussion ENSURE YOU COVER THE BELOW IN YOUR DISCUSSION, USE EACH LINE AS A HEADING Discuss all the below in relation to ratios and information from reports. Has Year 1 been better than Year 2 for the company? Will the company succeed in the future? The likelihood of a merger or acquisition? Consider the relevant ethical considerations if the organisation becomes insolvent Suggest what should the company be doing help it succeed? The impact of the political competitive environment on the business External factors that need to be taken into consideration Would you invest in this company? 5 References/Bibliography Appendices – attached Excel Spreadsheet Company fin600 tX YYYY name: Student id: PAGE 7 Profitability Ratios Profitability and Market Ratios - COMPANY ASX CODE YYYYYYYYAverage for IndustryIndustry average to be provided by facilitator Return on AssetsProfit / Average total assetsProfit / ((Year 1 Total A + Year 2 Total A)/2)Profit /Year 2 Total A 00 0.00%0.00%result % Return on EquityProfit / Average equityProfit / ((Year 1 OE + Year 2 OE)/2)Profit /Year 2 OE 00 0.00%0.00% Net Profit MarginNet profit / Sales or revenueNP/ RevenueNP/ Revenue 00 0%0%result % Gross Profit MarginGross profit / Sales or revenueGP/ SalesGP/ Sales 00 0%0%result % Net Interest IncomeNet Interest Income / Average Earning AssetsNII / ((Year 1 earning A + Year 2 earning A)/2)NII / Year 2 earning A for banks only00 0.00%0.00%result % Expense ratioExpenses (excluding tax) / Net salesExp / RevenueExp / Revenue (using operating expenses/operating income)00 0%0%result % Cash return on salesNet cash flow from operating activity / Sales or Revenue$ op activities / REV$ op activities / REV 00 0%0result % Earnings per shareProfit for shareholders / Number of ordinary shares$xx per share$xx per share EPS taken from annual report Price earnings ratioShare price 30 June / Earnings per share$XX / EPS$XX / EPS share price 30 June taken from annual report0.00000.0000 XX timesXX timesresult times Earnings yieldEPS / Share price 30 JuneEPS / $XXEPS / $XX share price 30 June taken from annual report00 0.00%0.00%result % Dividends per shareDividends - Special dividends/ No of shares$XX per share$XX per share$xx per share (determined)DPS taken from annual report EPS taken from annual report DPS taken from annual report Efficiency Ratios Efficiency Ratios - COMPANY ASX CODE YYYYYYYYAverage for IndustryIndustry average to be provided by facilitator Asset turnoverSales / Average total assetsrevenue / ((Year 1 Total A + Year 2 Total A)/2)revenue / Year 2 Total A 00 xx timesxx timesresult times Cashflow return on assetsNet cash from op activities / Average total assets$ op activities/ A$ op activities/ A 00 result timesresult timesresult times Fixed-Asset Turnover RatioSales / Total non current assetsrevenue / Total NCArevenue / Total NCA 00 xx timesxx timesresult times Liquidity Ratios Liquidity Ratios - COMPANY ASX CODE YYYYYYYYAverage for IndustryIndustry average to be provided by facilitator Current RatioTotal current assets / Total current liabilitiesCA / CLCA / CL 00 XX:1XX:1XX:1 Quick Ratio(Total current assets - Inventory) / Total current liabilities(CA - INV) / CL(CA - INV) / CL 00 result:1result:1XX:1 Receiveables turnoverCredit sales rev / Avg receivables(Credit sales rev/ ((Year 1 Acc rec + Year 2 Acc rec)/2)/100) *365(Credit sales rev/Acc rec)/100*366 (can only calculate if credit sales specified or provided)00 result daysresult daysresult days Average collection periodAverage receiveables x 365 / Net credit sales rev(Acc rec *365) / Rev(Acc rec *365) / Rev (can only calculate if credit sales specified or provided)00 xx daysxx daysresult days Gearing Ratios Gearing Ratios - COMPANY ASX CODE YYYYYYYYAverage for IndustryIndustry average to be provided by facilitator Debt to EquityTotal debt / Total equity or Total liabilities / Total equityDebt / EquityDebt / Equity or Actual debt / Total equity00 - 0- 0result% Debt ratioTotal debt / Total assetsDebt / Total AssetsDebt / Total Assets 00 0%0%result% Equity RatioTotal equity / Total assetsOE / AOE / A 00 0%0%result% Cash debt coverageAvg total liabilities / $$ from op activities((Year 1 Total L + Year 2 Total L)/2) / $ operating activitiesYear 2 Total L / $ operating activities 00 0%0%result% Interest coverage ratioEBIT / Interest expenseEBIT / Interest ExpEBIT / Interest Exp 00 xx timesxx timesresult times
Answered Same DayAug 16, 2021FIN600

Answer To: TELSTRA Student name – ID FIN600 TX YYYY Assignment – Company Executive Summary Contents Page Number...

Priyanka answered on Aug 19 2021
145 Votes
Table
    
            PARTICULARS    FORMULAS    2018    2017    AVERAGE FOR INDUSTRY
            PROFITABILITY RATIOS
            Return on Assets    Profit / Average total assets    Profit / ((Year 2018 Total A + Year 2017 Total A)/2)    Profit /Year 2017 Total A                `
                    0.1461149056    0.0915320811
                    14.61%    9.15%    9-15%
            Return on Equity    Profit / Average equity    Profit / ((Year 2018 OE + Year 2017 OE)/2)    Profit /Year 2017 OE
                    0.3085625078    0.1959696719
                    30.86%    19.60%
            Net Prof
it Margin    Net profit / Sales or revenue    NP/ Revenue    NP/ Revenue
                    0.3365579192    0.2188858356
                    33.66%    21.89%    10-22%
            Gross Profit Margin    Gross profit / Sales or revenue    GP/ Sales    GP/ Sales
                    1.0127831795    0.895178616
                    101.28%    89.52%    —
            Expense ratio    Net operating costs (excluding tax) / Net sales    Exp / Revenue    Exp / Revenue
                    0.6691426879    0.6740694479
                    66.91%    67.41%    —
            Cash return on sales    Net cash flow from operating activity / Sales or Revenue    $ op activities / REV    $ op activities / REV
                    0.2917180791    0.3468398701
                    29.17%    34.68%    25-35%
            Earnings per share    Profit for shareholders / Number of ordinary shares    793.2    490.4
            Price earnings ratio    Share price 31 December / Earnings per share    $50.55 / $7.93    $51.02 / $4.90
                    6.3745271122    10.412244898
                    6.37 times    10.41 times    7-15 times
            Earnings yield    EPS / Share price 31 December    $7.93 / $50.55    $4.90 / $51.02
                    0.1568743818    0.0960407683
                    15.69%    9.60%    7-15%
            Dividends per share    Dividends - Special dividends/ No of shares    307.0    270.0    —
            EFFICIENCY RATIOS
            Asset turnover    Sales / Average total assets    revenue / ((Year 1 Total A + Year 2 Total A)/2)    revenue / Year 2 Total A
                    0.4341449042    0.4181727013
                    0.434 times    0.418 times    0.3-0.6 times
            Cashflow return on assets    Net cash from op activities / Average total assets    $ op activities/ A    $ op activities/ A
                    0.1299739414    0.1450389654
                    0.129 times    0.145 times    —
            Fixed-Asset Turnover Ratio    Sales / Total non current assets    revenue / Total NCA    revenue / Total NCA
                    0.5784972947    0.5228988688
                    0.578 times    0.522 times    —
            LIQUIDITY RATIOS
            Current Ratio    Total current assets / Total current liabilities    CA / CL    CA / CL
                    1.9078611295    1.6639643653
                    1.90:1    1.66:1    1.33:1
            Quick Ratio    (Total current assets - Inventory) / Total current liabilities    (CA - INV) / CL    (CA - INV) / CL
                    1.5817803424    1.3546547884
                    1.58:1    1.35:1    1.00:1
            Receiveables turnover    Credit sales rev / Avg receivables    (Credit sales rev/ ((Year 1 Acc rec + Year 2 Acc rec)/2)/100) *365    (Credit sales rev/Acc rec)/100*366
                    89.3957691145    84.9824825986
                    89.39 days    84.98 days    —
            Average collection period    Average receiveables x 365 / Net credit sales rev    (Acc rec *365) / Rev    (Acc rec *365) / Rev
                    14.2768125956    15.7197102173
                    14.27 days    15.71 days    —
            GEARING RATIOS
            Debt to Equity    Total debt / Total equity or Total liabilities / Total equity    Debt / Equity    Debt / Equity
                    0.2793890372    0.3140369754
                    27.94%    31.40%    20-33%
            Debt ratio    Total debt / Total assets    Debt / Total Assets    Debt / Total Assets
                    0.1530528098    0.1676869398
                    15.31%    16.77%    —
            Equity Ratio    Total equity / Total assets    OE / A    OE / A
                    0.4803351329    0.4670726866
                    48.03%    46.71%    35-45%
            Cash debt coverage    Avg total liabilities / $$ from op activities    ((Year 1 Total L + Year 2 Total L)/2) / $ operating activities    Year 2 Total L / $ operating activities
                    3.6264698418    3.2131230193
                    362.65%    321.31%    —
            Interest coverage ratio    EBIT / Interest expense    EBIT / Interest Exp    EBIT / Interest Exp
                    32.9710144928    17.0683962264
                    32.97 times    17.06 times    —
Profitability Ratios
    Profitability and Market Ratios - RIO
        FORMULAS    2018    2017    Average for Industry    Industry average to be provided by facilitator
    Return on Assets    Profit / Average total assets    Profit / ((Year 2018 Total A + Year 2017 Total A)/2)    Profit /Year 2017 Total A
            0.1461149056    0.0915320811
            14.61%    9.15%    9-15%
    Return on Equity    Profit / Average equity    Profit / ((Year 2018 OE + Year 2017 OE)/2)    Profit /Year 2017 OE
            0.3085625078    0.1959696719
            30.86%    19.60%
    Net Profit Margin    Net profit / Sales or revenue    NP/ Revenue    NP/ Revenue
            0.3365579192    0.2188858356
            33.66%    21.89%    10-22%
    Gross Profit Margin    Gross profit / Sales or revenue    GP/ Sales    GP/ Sales
            1.0127831795    0.895178616
            101.28%    89.52%    —
    Net Interest Income    Net Interest Income / Average Earning Assets    NII / ((Year 1 earning A + Year 2 earning A)/2)    NII / Year 2 earning A
        for banks...
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