This business report have analysed the financial statements of The Reject Shop Limited (TRS) in order to evaluate the financial performance and position of the company over the 4 year period 2006 to 2009. In additional, an evaluation on The Reject Shop as an investment was also reviewed and discussed.
The trends of the total revenue and percentage increase/decrease year per year for the four years 2006 to 2009 are illustrated and evaluated. The results of the gross and net profit margins over the four are also interpreted. The difference between return on assets (ROA) and return on shareholders’ equity (ROE) are defined and the ratios calculated are interpreted and explained. The ROA and ROE ratios of Warehouse Group Limited (WHS) which is in the similar industry as The Reject Shop Limited is used in comparison to analyse and evaluate which of these two companies is performing better.
The cash flow statements in terms of operating, investing and financing activities for the four years are interpreted and the trends and major items are analysed and discussed. The ending cash balances (closing balance) are also analysed and the changes are discussed. The short-term liquidity of The Reject Shop Limited (TRS) in terms of current and quick ratio are defined, explained and interpreted. From the interpretation and results of the total liabilities over total assets and interest cover ratio, the financial position of The Reject Shop over the 4 years is discussed.
The dividend yield and price/earnings ratio are interpreted and using the results calculated, the investing in The Reject Shop over the four years are analysed and evaluated. The performance of The Reject Shop Limited (TRS) since 30th June 2009 will be analysed and whether or not to purchase and invest in shares of this company at its most recent price will be evaluated and discussed with reference to financial newspapers.