Ration Analysis

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CW ratios (use this as a basis for your work):
Ratio calculations for Sainsbury’s plc for 2011 and 2012 and Tesco for 2012 Ratio| Sainsbury’s 2011| Sainsbury’s 2012| Tesco 2012| Profitability:| | | |
Gross Profit Margin (GP/Revenue x 100)| 738/22,943*100=3.216| 789/24,511*100=3.22| 5,261/64,539*100=8.15| Operating Profit Margin (Operating profit/Revenue x 100)| 827/22,943*100=3.604| 799/24,511*100=3.259| 3,985/64,539*100=6.174| ROCE (Operating Profit/Equity + NCL’s x100)| 827/(5,424+3,033)*100=827/(8,467)*100=9.77| 799/(5,629+3,575)*100=799/9204*100=8.68| 3,985/17,801+6,386*100=3,985/24,187*100=16.48| Liquidity:| | | |

Current Ratio(CAs/CLs)| 1,708/3,033=0.56 time| 2,032/3,575=0.57 time| 12,863/19,180=0.67 time| Quick Ratio/Acid test(CAs – inventory / CLs)| 1,708-812/3,033896/3,033=0.30 time| 2,032-938 /3,5751,094/3,575=0.31 time| 12,863-3,598/19,1809,265/19,180=0.48 time| Efficiency:| | | |

Inventory Turnover Period(inventory/COS * 365)| (812+702/2)/19,942*365=21.29 days| (938+812/2)/21,083*365=23.27 days| (3598+3162/2)/59278*365=31.89 days| Gearing:| | | |
Gearing ratio(debt/debt + equity x 100)| 3033 /(3033 +5,424)*100=35.86| 3575/(3575+5629)*100=38.84| 11234/(11234+17801)*100=38.69| Interest cover(operating profit/int payable)| 827/143=5.78| 799/162=4.93| 3,985/531=7.50|
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