Joanna Andrews Elizabeth Griffiths Brittany Boone February 5, 2013.

Slides:



Advertisements
Similar presentations
Analyzing Financial Statements
Advertisements

Chapter 3 Analysis of Financial Statements
FINANCIAL STATEMENT ANALYSIS. Statement Analysis - 2 FINANCIAL STATEMENT ANALYSIS Objectives Creditors Short term liquidity Long-term solvency Investors.
Basics of Financial Management 3rd edition Bacon et. al Copley Publishing Group CHAPTER THREE 3-1 ©2005 All rights reservedSlides by Hassan Moussawi,
© 2010 Prentice Hall Business Publishing, College Accounting: A Practical Approach, 11e by Slater Analyzing Financial Statements Analyzing Financial Statements.
Financial Statement Analysis
© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible Web site, in whole or in part.
Financial Aspects of a Business Plan
LEVERAGE ANALYSIS. Leverage The dictionary meaning of the firm leverages refers to “an increase means of accomplishing purpose ”. In machines, leverages.
U The Use Of Financial Ratios u Analyzing Liquidity u Analyzing Activity u Analyzing Debt u Analyzing Profitability u A Complete Ratio Analysis.
Copyright © 2007 South-Western. All rights reserved. Chapter 15 Accounting and Financial Analysis.
Parts of a Financial Statement 1.Statement of Income 2.Balance Sheet 3.Statement of Cash Flow 4.Statement of Stockholders’ Equity.
STRIDENT- FINANCIALS BY - RAHUL JAIN. Three Basic business Activites Financing activities : z Financing activities : - Owners contribute cash and receive.
Financial Statements Ratio Analysis
1 PowerPointPresentation by PowerPoint Presentation by Gail B. Wright Professor of Accounting Bryant University © Copyright 2007 Thomson South-Western,
ANALYSIS OF FINANCIAL STATEMENTS Using Ratios Presented by the Arkansas Securities Department.
Corporate Finance A1 Vysoká škola finanční a správní Summer Semester 2012 Jaromír R. Stemberg
CHAPTER 3 Working With Financial Statements. Key Concepts and Skills Know how to standardize financial statements for comparison purposes Know how to.
Financial/Ratio Analysis
Intro to Financial Management Understanding Financial Statements and Cash Flows.
McGraw-Hill/Irwin Slide 1 Preliminary Press Releases Releasing Financial Information Quarterly and Annual Reports Securities and Exchange Commission (SEC)
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 13-2 Financial Statements and Analysis.
Small Business Management BUS 402 Creating a Solid Financial Plan.
Parts of a Financial Statement 1.Statement of Income 2.Balance Sheet 3.Statement of Cash Flow 4.Statement of Stockholders’ Equity.
Intro to Financial Management Evaluating a Firm’s Financial Performance.
Chapter 9 Financial Statement Analysis. Learning Objectives After studying this chapter, you should be able to…  Describe basic financial statement analytical.
Previous Lecture Purpose of Analysis; Financial statement analysis helps users make better decisions Financial Statements Are Designed for Analysis Tools.
Chapter 9: Financial Plan 1 Copyright 2002 Prentice Hall Publishing Company Creating a Successful Financial Plan.
Agenda 14 December :30 Call to Order 9:35 Minutes 9:40 Treasurer’s Report 9:45 Old Business –Value Line 10:00 New Business 10:10 Education 10:30.
Financial Analysis Ag Management Chapter 3. Objectives Know the three kinds of financial analysis Be able to calculate liquidity, solvency, and equity.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 13-1 Work Sheet for a Corporation.
Essential Standard 4.00 Understanding the role of finance in business. 1.
Finance Chapter 3 Analysis of financial statements.
Chapter 2 Financial Ratio Analysis. 2-2 Example 2.1 Problem  Rylan Enterprises has 5 million shares outstanding.  The market price per share is $22.
Financial Analysis Professor Ronald Miolla. Agenda 1) What are ratios? 2) Purpose of financial ratios. 3) Common financial ratios. 4) Ratios in context.
Chapter 2 Introduction to Financial Statement Analysis.
Sales41,139,44,2 Operating profit3,53,43,0 Percentage of net sales8,78,7 Profit before tax3,43,33,1 Percentage of net sales8,48,4 Profit for the period.
Analyzing Financial Statements
Theme: Indicators of activity of firms efficiency. Plan: The main indicators of efficiency of activity of firms: profit, sales volume, profitability.
Summary Of Previous Lecture  basic financial statements and their contents.  financial statement analysis and its importance to the firm and to outside.
Analyzing Financial Data Ratio Analysis. Lesson Components Four Key Financial Statements Ratio Overview Ratio Categories ▫Liquidity ▫Activity ▫Debt ▫Profitability.
©2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publically accessible website, in whole or in part.
Dr Eva CipovovaCorporate Finance I1 I. Role of Financial Analysis Financial Statements & Annual report –Financial statements BS, P&L, CF, Statement of.
Financial Ratios BUS 499 CAPSTONE L. Panetta P. Tinsley © Idaho State University – College of Business.
FINANCIAL STATEMENTS By: George Goto. FINANCIAL PERFORMANCE RATIO  Financial Performance Ratio: Comparisons of a company’s financial elements that indicate.
Dr Irena JindrichovskaFinancial Analysis1 I. Role of Financial Analysis Financial Statements & Annual report –Financial statements BS, P&L, CF, Statement.
Chapter 9: Financial Plan 1 Copyright 2002 Prentice Hall Publishing Company Creating a Successful Financial Plan.
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
By : Breana Moore Principles Of Business and Finance, Period 02.
Example 16 1 Given income statement Given balance sheet.
Accounting: What the Numbers Mean Study Outline and Overhead Master Chapter 11.
Financial Ratios.
Financial Statement Analysis
Financial Statement Analysis
Channel Management and Logistics
Analysis of Financing Activities
Financial Analysis of The “Voda Vrnjci” company
FINANCIAL PERFORMANCE For Pfizer & Novartis
Financial/Ratio Analysis
© 2015 Cengage Learning. All Rights Reserved.
Lecture 1 Du Pont Identity.
Financial Analysis Quick ratio: ($22,000+ $41,500)/
Intro to Financial Management
FINANCIAL STATEMENT ANALYSIS
FINANCIAL STATEMENT ANALYSIS
FINANCIAL STATEMENT ANALYSIS
Intro to Financial Management
Ratio Analysis - Overview
Financial Statements: Basic Concepts and Comprehensive Analysis
Interpreting Accounts
Presentation transcript:

Joanna Andrews Elizabeth Griffiths Brittany Boone February 5, 2013

Agenda  Overview/History

Agenda  Overview/History  Financials

Agenda  Overview/History  Financials  Presentation & Interpretation of Ratios

Agenda  Overview/History  Financials  Presentation & Interpretation of Ratios  Summary

Overview/History

Financials

Financials – Income Statement

Financials – Balance Sheet

Financials – Balance Sheet (Cont’d) 03/012 03/011 03/010

Presentation & Interpretation of Ratios

Ratios – Return on Common Equity  2012: (7,028,000)/7,667,000 = (91.67%)  2011: (2,962,000)/7,612,000 = (38.91%)  2010: (760,000)/6,751,000 = (11.26%)  Return on Common Equity = Net Income/Common Equity

Interpretation of ROE  All 3 years = stockholders are earning negative returns off their investments  Reason: net income has been on the negative side due to high operating expenses  Negative ROE has continued to drastically plummet

Ratios – Return on Assets  2012: (7,028,000)/161,561,000 = (4.35%)  2011: (2,962,000)/155,781,000 = (1.90%)  2010: (760,000)/137,694,000 = (0.55%)  Return on Assets = Net Income/Total Assets

Interpretation of ROA  All 3 years have a negative ROA  Due to net loss from high interest expenses (too much debt) & operating expenses  ROA was closest to 1% in ‘010 from a lower bundle of assets

Ratios – Current Ratio  2012: 45,628,000/55,046,000 = x  2011: 46,381,000/49,895,000 = x  2010: 44,230,000/43,450,000 = x  Current Ratio = Current Assets/Current Liabilities

Interpretation of Current Ratio  All 3 years have a positive number which has slowly been decreasing since ‘010  Not enough assets to cover debt  Financials show more debt borrowing due to financial difficulty and slowing of A/P payments

Ratios – Debt Ratio  2012: 136,664,000/161,561,000 = 84.59%  2011: 124,805,000/155,781,000 = 80.12%  2010: 105,953,000/137,694,000 = 76.95%  Debt Ratio = Total Debt/Total Assets

Interpretation of Debt Ratio  All 3 years have extremely high debt ratio percentages; increasing with each year  Sony’s creditors have supplied it with an average of 80% of its funds This percentage will make it hard for Sony to borrow more funds Risk of bankruptcy if continued?

Ratios – Profit Margin  2012: (7,028,000)/ 78,902,000 = (8.91%)  2011: (2,962,000)/86,647,000 = (3.42%)  2010: (760,000)/77,205,000 = (0.98%)  Profit Margin = Net Income/Sales

Interpretation of Profit Margin  All 3 years have a negative PM  Due to high interest expenses (debt) and operating expenses  Sales have also decreased by $1,882,000

Summary

 Overall, Sony Corporation has been operating poorly over the past 3 years High interest payments (high debt) ○ Debt ratio High operating expenses Not a lot of assets

Work Cited  Brigham, E. F., & Houston, J. F. (2012). In Fundamentals of financial management. Mason, Ohio: South-Western Cengage Learning.  History of Sony Corporation. (n.d.). FundingUniverse. Retrieved January 30, 2013, from corporation-history/  SNE Balance Sheet | Sony Corporation. (n.d.). Yahoo! Finance. Retrieved January 30, 2013, from  SNE Income Statement | Sony Corporation. (n.d.). Yahoo! Finance. Retrieved January 30, 2013, from  SONY Timeline. (n.d.). Timetoast. Retrieved January 30, 2013, from