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Kingdo Financial Analysis

Autor:   •  November 8, 2017  •  5,823 Words (24 Pages)  •  502 Views

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- Current Assets Structure

There was a fairly swift fluctuation in the current assets during the period from 2007 to 2011.

[pic 13]

Initially there was a decrease from 2007 to 2008, and then the current started to increased sharply from 2008. It reached the peak of nearly 250,000 billion VND in 2009 before declining slightly in 2010 and then bounced back to more than 260,000 billion VND in 2011.

- Inventory

2007

2008

2009

2010

2011

Inventory

13,627

18,166

16,248

43,433

39,803

Inventories

13,667

18,282

16,307

43,493

39,966

Goods in transit

335

0

146

1,342

1,080

Raw materials

10,394

13,500

13,023

30,708

26,661

Tools

694

1,340

1,132

2,051

2,865

Work-in-progress

36

616

55

215

110

Finished goods

1,281

148

326

3,938

4,743

Merchandise

927

2,091

1,625

5,239

4,507

Goods on consignment

0

587

0

0

0

Provision for decline in value of inventories

-39

-116

-59

-60

-162

The largest proportions of inventory are raw material, finished goods and merchandise. That means KDC could actively cope with changes in the price of input. The amount of spare goods in supply was also kept available. KDC therefore could control properly their producing and supply sources.

3. Short- term Investment

As could be seen in the balance sheet, short-term investment fluctuated in the same direction as the current assets. However, in general, the proportion of short-term investment in the period of 2009-2011 is smaller than that of 2007-2009. This means that recently KDC has already withdrew the funds invested in short-term financial investment. In this way, KDC may lose chances to boost up its revenue through securities investment. However, concerning the fact that KDC’s core business is confectionery manufacturing, together with the slow-down of the economy at that moment, it seems to be a reasonable choice.

4. Account receivables

Being a confectionery manufacturer, it is necessary for KDC to maintain a stable and high proportion of short term receivables. From the balance sheet, we could see that the short-term receivables increased by 41% from 2009 to 2010 and also peaked at this year when the short-term receivables counted for 43.7% of current assets. This situation may lead to many difficulties in collecting debts. However, there was a significant reduce in 2011 with the proportion of only 28.3%. This figure shows that the company has restricted its credit policies to ensure timely receivable collection and avoid liquidity risk.

5. Non-current Assets

Non-current assets increased gradually from nearly 160,000 million VND in 2007 to 330,000 million VND in 2011. Especially, it has surpassed current assets in the last two years, accounted for 55.6% of total assets in 2011.

[pic 14]

Let’s take a closer look at structure of non-current assets of KDC through the following chart:

[pic 15]

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Income Statement Analysis

Items (in billion VND)

2011

2010

2009

2008

2007

REVENUES

4,278.05

1,942.81

1,539.22

1,466.19

1,238.34

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