Analysis of Financial Standing of Crawshaw Group Plc

Topics: Financial ratios, Inventory, Balance sheet Pages: 14 (4087 words) Published: April 17, 2013

Choosing the topic and organisation:
The topic area I have selected for my project work is the “Business and Financial Performance of an Organization” over the past three years and I took the privilege to consider Crawshaw Group PLC for my project. It is a UK company. To select Crawshaw Group PLC as the company for the project was not an easy task. I first tried comparing newspapers and the articles in search for the top most companies to select but in every sector of the market there stands a market leader. While evaluating different companies, Crawshaw Group PLC impressed me a lot and I then decided to go ahead with Crawshaw.

I further compare its performance with its competitor “Greggs PLC” which is also a UK company.

Reasons for choosing the company:
Crawshaw is one of the leading organizations in the UK and hence have expanded all over the world, adding more countries to its portfolio year by year. The company’s activity which provides the most of its revenue is food retailing. Crawshaw’s states, “The Company will create new brands to improve its products and appeal to aspirational consumers around the world” And back in January 2005 The Guardian published its report saying “£1 in every £8 of UK consumers is taken up by Crawshaw”. The report proves the company has the potential and knowledge of its customers. As exciting Crawshaw’s background is it got more interesting as I went deep in Crawshaw’s considering its functions and operations. The overall business strategy of Crawshaw been successful despite the worst of economic environment prevailed.

As rightly said by the CEO of Crawshaw,
“It plans to create another 16,000 jobs this year, including 9,000 in the UK, as it continues to open new stores”.

Aims and Objectives of the Project
The Aim and objectives of this research project is to acknowledge the various business decisions and strategies that the company. To analyze the assessment of how the company have managed its revivals and their products and how this all have helped its growth that was recorded in terms of profitability, customers and market share price. To study the company’s past and present relations of profitability with regards to the environment it operated in. To conclude on how a company has managed to maintain its strong commitment to the shareholder while enhancing itself with constant expansion and diversification in related and non-related industries. I’ll use SWOT analysis and Porter Five Forces models to understand the strengths, weaknesses, the opportunities and threat it faces which would identify its success factors and how it survived throughout its life. Performance And Financial Ratios:

1 - Profitability Ratios:

Profitability ratios are the ratios which provide the analysis of the return to the shareholders.

Gross Profit Margin: This ratio calculates the percentage change between the revenue and the amount left after cost of goods sold.

Net Profit Margin: This ratio also enables the users to calculate the overall change in percentage of the revenue earned and the profit left after taking all the cost of running the business.

The Return on Capital Employed: This calculates the ratio which indicates the efficiency and profit making ability of a company's capital investments. These ratios tell us on what levels the business is making profit and what level is expected and acceptable.

And how will the external investor interpret these ratios to assess the worth of certain company.

2 - Liquidity Ratios:
This ratio indicates the ability of a company to pay its debts as they fall due. It is generally considered to be a more accurate assessment of a company's financial health. Current Ratio: It is the ratio that establishes the time current assets would be able to cover the current liabilities; this it shows the company’s ability to meet its liabilities. Quick Ratio: It eliminates inventory from the current asset...
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