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Pace Leisurewear公司的案例研究 Pace Leisurewear Ltd Case Study(3)

时间:2017-08-07 16:15来源:www.ukthesis.org 作者:英国论文网 点击联系客服: 客服:Damien
Return on Capital Employed (ROCE)
ROCE ratio tells us how much profit we earn from the investment the shareholders have made in their company. If the company has low ROCE ratio, it is using its resources inefficiently, even if its profit margin is high. The higher the ratio the more efficient is the use of capital employed.
In context of the Pace Leisurewear Ltd, ROCE ratio was increased in the last year than the year before last. From the calculation, we got, it was 30% in the last year whereas it was 20% in the year before last. So, we can say that the company had better performance in the last year than the year before last.
Return on Equity
This ratio indicates the profitability to the shareholders of the firm with deduction of all expenses and taxes.
In context of this company, the return on equity ratio was increased which is good for the company. It was 32.5% in the last year and 18% in the year before last.
Gross Profit Margin
It indicates the efficiency of operations and firm's pricing policies. The larger the gross profit margin, the better for the company. It looks at how well a company controls the cost of its inventory and manufacturing of its products and subsequently pass on the cost to its customers.
From the calculation we found that the gross profit margin ratio was increased. It was 46.16% in the year before last and 48.16% in the last year which is good for the company.
Net Profit Margin
This ratio measures the relationship between net profit and sales of a firm. A high net profit margin in ratio is an indicative of adequate return to the owners as well as enables a firm to withstand adverse economic conditions. A low net profit margin ratio has the opposite implications.
From the calculation, we found that the net profit margin ratio was increased. It was 8.91% in the year before last and 13.10% in the last year. It shows that the company was selling well which is good for the company.
Inventory Holding Period
A high number of days inventory indicates that there is lack of demand for the product being sold whereas a low days inventory holding period may indicate that the company is not keeping enough stock on hand to meet the demands.
It is known from the above calculation that the inventory holding period for the company in the year before last was 63 days and for the last year it was 95 days. So, this extension in the inventory holding period is a problem for the company which obstructs the path of cash generating.
Average Collection Period of Trade Receivables
This ratio indicates the speed with which debtors/accounts receivables are being collected. A short, collection period implies prompt payment by the debtors. It reduces the chance of bad debts. Similarly, a longer collection period implies too liberal and inefficient credit collection performance.(责任编辑:cinq)

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