Common Baze And Trend Analysis Of Swisscom's Balance Sheet
Common-size and trend analysis of the BS
In our analysis of Swisscom’s Balance Sheet, we first decided to have a global view and then to go into details in order to conduct a good analysis.
When we first look at the BS, we notice that the company is in a very positive situation from a financial viewpoint. Indeed, some of its assets increased between 2011 and 2013, while some of its liabilities decreased during this period. When we conduct this type of analysis, it is necessary to take into account the economic context in Switzerland and in Europe, and on the telecommunication market. We know that we are in a recession period, thus companies are supposed to have a decrease in their income and their liquidities. Moreover, the telecommunication …show more content…
As we have seen before, it’s a factor which affects the ROE. More precisely, while net debt is decreasing ROE is increasing and profit as well. To reduce the net debt the company may increase efficiency of its assets. By comparing companies in the same sector, we have seen there is a huge gap between Orange and Swisscom. Nevertheless, Swisscom is less well-implemented than Orange since they have been invested a lot in infrastructures. This policy will offer to this company a great competitive advantage to long-term. The long-term debt will also decrease in long-term. Moreover, Swisscom should increase its revenue (we have seen that Orange has huge revenue). The company may reach a larger market as Orange reach more people in France than Swisscom in Switzerland. The idea is that the company should open to other markets by using infrastructures of other companies to do not increase long-term debt and investment. For instance, this kind of policy is used by companies which do not own a lot of market share in market (as Swisscom’s competitors in Switzerland); but actually it could be a great solution in short-term in order to increase quickly revenue without increasing long-term debt. The second solution would be to wait for the expected return based on investments already done by the
In our analysis of Swisscom’s Balance Sheet, we first decided to have a global view and then to go into details in order to conduct a good analysis.
When we first look at the BS, we notice that the company is in a very positive situation from a financial viewpoint. Indeed, some of its assets increased between 2011 and 2013, while some of its liabilities decreased during this period. When we conduct this type of analysis, it is necessary to take into account the economic context in Switzerland and in Europe, and on the telecommunication market. We know that we are in a recession period, thus companies are supposed to have a decrease in their income and their liquidities. Moreover, the telecommunication …show more content…
As we have seen before, it’s a factor which affects the ROE. More precisely, while net debt is decreasing ROE is increasing and profit as well. To reduce the net debt the company may increase efficiency of its assets. By comparing companies in the same sector, we have seen there is a huge gap between Orange and Swisscom. Nevertheless, Swisscom is less well-implemented than Orange since they have been invested a lot in infrastructures. This policy will offer to this company a great competitive advantage to long-term. The long-term debt will also decrease in long-term. Moreover, Swisscom should increase its revenue (we have seen that Orange has huge revenue). The company may reach a larger market as Orange reach more people in France than Swisscom in Switzerland. The idea is that the company should open to other markets by using infrastructures of other companies to do not increase long-term debt and investment. For instance, this kind of policy is used by companies which do not own a lot of market share in market (as Swisscom’s competitors in Switzerland); but actually it could be a great solution in short-term in order to increase quickly revenue without increasing long-term debt. The second solution would be to wait for the expected return based on investments already done by the