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Group Assignment |1

Financial statement analysis Group Assignment

Lecturer: Mr. Phạm Sỹ Long Class: FB0607 Nguyễn Ngọc Huy – FB00358 Phan Thu Hương – FB00095 Trần Hoàng Minh – FB00049 Nguyễn Thành Trung – FB00360

Group Assignment |2

TABLES OF CONTENTS
1. 2. Executive summary .......................................................................................................................3 Introduction ...................................................................................................................................3 2.1 2.2 3. Industry Analysis ...................................................................................................................3 Background information of two companies ..........................................................................5

Financial Analysis .........................................................................................................................8 3.1 3.2 3.3 3.4 Short term Liquidity ..............................................................................................................8 Capital structure and solvency............................................................................................. 16 Return on invested capital ...................................................................................................18 Operating profitability .........................................................................................................19

4.

Conclusion & Recommendations ............................................................................................... 21 4.1 4.2 Conclusion: ..........................................................................................................................21 Recommendation: ................................................................................................................22

Group Assignment |3

1. Executive summary
Financial analysis is a necessary step when anyone wants to understand about the company’s financial condition. However, the purpose of each people is different because with each position and point of view, each person will care about what they need and access them by a suitable way. To get an exact result in analyzing any financial statements of companies, we should compare the company with other company in the same industry or the company with the average level of its industry. It makes the analysis becomes more valuable and meaningful. In this assignment, in the position of creditors, our group selected two companies: Mc Donald’ s Corp’s Corp. and Yum! Branch, Inc. in the same industry: restaurant to analyze, compare and evaluate their financial condition based on some group of ratio such as short term liquidity, capital structure & solvency, return on invested capital and operating profitability.

2. Introduction
McDonald’s Corp Listed at Market cap Industry Stock Related information Websites NYSE $ 95.63 billion Restaurants MCD http://www.nasdaq.com/symbol/mcd http://www.mcdonalds.com/ NYSE $ 29.52 billion Restaurants YUM http://www.nasdaq.com/symbol/yum http://www.yum.com/ Yum! Branch, Inc.

2.1

Industry Analysis

The operating environment (for many businesses) will remain challenging in the coming year, however “record sales are expected in the restaurant industry” according to the National Restaurant Association (NRA). Earlier this month the NRA published its annual Restaurant Industry Forecast for the coming year. Overall, the outlook is good for, “America’s 980,000 restaurants which will continue to be a leading job creator in 2013.” Here are some of the news highlights from the NRA report: Expectations Total restaurant industry sales are expected to exceed $660 billion in 2013 – a 3.8 percent increase over 2012, marking the fourth consecutive year of real sales growth for the industry.

Group Assignment |4

2013 will be the 14th straight year in which restaurant industry...
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