David Jones Case Study
Comparative Financial Analysis for the financial year 2012 for DAVID JONES
Word Count: words
Members of the Group (surname underlined):
LIM EWE LEE 30109302
WONG MEI LIN 30109335
TEH KONG CHENG 30111788
Executive Summary David Jones, an Australia base company with its core business of operate departmental store in Australia, the company focus are beauty and cosmetic products, women’s wear, women’s accessories and footwear, menswear and accessories, food products, toys, home products, and products for babies and children. This report has been prepared with the objective of examine financial health of David Jones. The achieve the objective, five key financial ratio analysis: Profitability, Liquidity, Asset Efficiency, Capital Structure has been use throughout the report David’s Jone’s profit margin has declined by 9% in year 2012 with $0.8 cent of net profit derived from every dollar of total sales in year 2012. Declined result in Return on Equity (ROE), Return on Asset (ROA) and gross profit suggest that company having hard time during this financial period and is not able to optimized its resource to support revenue growth. From the liquidity perspective, the company has weaker liquidity compare to year 2011. Cash flow ratio indicates 7% declined from previous year, which could impact the company’s cash flow to meet the short term liabilities. The current ratio also show dropping by 01.7 time compare to year 2011, suggesting slowdown in inventory turnover and increased borrowing in year 2012. Though facing with tough challenges, the company had started to implemented number of strategic initiative to counter the continue challenging trading environment. The company had adopted the change to Omni Channel Retail, extending reach to its quickly evolving customer base. The company also growing its store network at major city in Australia.
Despite the fact the failing of revenue, profits and dividends as indicated in the detail
Word Count: words
Members of the Group (surname underlined):
LIM EWE LEE 30109302
WONG MEI LIN 30109335
TEH KONG CHENG 30111788
Executive Summary David Jones, an Australia base company with its core business of operate departmental store in Australia, the company focus are beauty and cosmetic products, women’s wear, women’s accessories and footwear, menswear and accessories, food products, toys, home products, and products for babies and children. This report has been prepared with the objective of examine financial health of David Jones. The achieve the objective, five key financial ratio analysis: Profitability, Liquidity, Asset Efficiency, Capital Structure has been use throughout the report David’s Jone’s profit margin has declined by 9% in year 2012 with $0.8 cent of net profit derived from every dollar of total sales in year 2012. Declined result in Return on Equity (ROE), Return on Asset (ROA) and gross profit suggest that company having hard time during this financial period and is not able to optimized its resource to support revenue growth. From the liquidity perspective, the company has weaker liquidity compare to year 2011. Cash flow ratio indicates 7% declined from previous year, which could impact the company’s cash flow to meet the short term liabilities. The current ratio also show dropping by 01.7 time compare to year 2011, suggesting slowdown in inventory turnover and increased borrowing in year 2012. Though facing with tough challenges, the company had started to implemented number of strategic initiative to counter the continue challenging trading environment. The company had adopted the change to Omni Channel Retail, extending reach to its quickly evolving customer base. The company also growing its store network at major city in Australia.
Despite the fact the failing of revenue, profits and dividends as indicated in the detail
References: Birt, J., Chalmers, K., Byrne, S., Brooks, A., & Oliver, J. (2012). Accounting: Business Reporting for Decision Making - 4th Edition. Milton Qld: Wiley & Sons Australia Ltd. BLOOMBERG L.P. (2013). Financial on David Jones Ltd (DJS:ASX). Retrieved May 18, 2013, from http://www.bloomberg.com/: http://investing.businessweek.com/research/stocks/financials/ratios.asp?ticker=DJS:AU Brigham, E. F., & Daves, P. R. (2010). Intermediate Financial Management. Ohio, USA: South-Western Cengage Learning. Jones, J. P., Heitger, D. L., Mowen, M. M., & Hansen, D. R. (2011). Cornerstones of Financial and Managerial Accounting. OH, USA: Cengage Learning. Seeking Alpha. (2012, Feb 13). The Jones Group 's CEO Discusses Q4 2012 Results - Earnings Call Transcript. Retrieved May 15, 2013, from money.msn.com/business-news: http://money.msn.com/business-news/article.aspx?feed=SALP&date=20130213&id=16119711 Seeking Alpha. (2013, May 01). Money.msn.business-news. The Jones Group Management Discusses Q1 2013 Results - Earnings Call Transcript, pp. 1-3. Stice, E. K., Stice, J. D., & Swain, M. R. (2011). Accounting: Concepts & Applications - 11 Edition. OH, USA: Cengage Appendix 1