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Fantastic Holdings Ltd代写 Business

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  • Business Report of Fantastic Holdings Ltd & Super Retail Group Ltd
    Table of Contents
    1.0 Executive summary. 1
    2.0 Introduction. 2
    3.0 Profitability. 3
    3.1 Fantastic Holdings Limited’s profitability. 4
    3.2 Super Retail Group Limited’s profitability. 5
    3.3 Comparison between the two organizations. 6
    4.0 Efficiency. 7
    4.1 Fantastic Holdings Limited’s efficiency. 7
    4.2 Super Retail Group Limited’s efficiency. 7
    4.3 Comparison between the two organizations. 7
    5.0 Financial Stability. 9
    5.1 Fantastic Holdings Limited’s financial stability. 9
    5.2 Super Retail Group Limited’s financial stability. 9
    5.3 Comparison between the two organizations. 10
    6.0 Additional or Other information. 11
    7.0 Limitations. 12
    8.0 Recommendations... 13
    9.0 References. 14
    10.0 Appendices. 15
     

    1.0 Executive summary

    Fantastic Holdings Limited and Super Retail Group Limited are both retailers, after analyzing their profitability, efficiency and financial stability, the financial condition of the two organizations is much clearer. Fantastic Holdings Limited does better in profitability, efficiency and financial stability. Super Retail Group Limited should pay more attention to its liabilities and put more emphasis on increasing its efficiency of assets.

    2.0 Introduction

    Fantastic Holdings Limited (FHL), the third largest furniture retailer in Australia, which is overweighed by sales value. It is also the largest sofa manufacturer and vertically integrated furniture group in Australia. As one of Australia's leading mattress manufacturers, a national supply chain is operated by it to service all FHL's retail brands. Fantastic Holdings Limited‘s principal activities are the retail, manufacture and import of household furniture. It operates through two segments, which include the retail segment and the property segment (retail-business-review.com). Started in 1972, Super Retail Group Limited has grown to become one of Australasia’s leading specialty retailers, who possess eight retail brands. Super Retail Group Limited’s principal activities consist of retailing of auto parts and accessories, outdoor entertainment, sporting equipment and apparel, wholesale, retail and distribution of bicycles and bicycle accessories. It operates through three segments: Auto & Cycle Retailing, Leisure Retailing and Sports Retailing. To offer products and services that will enhance customers’ leisure time is the defining principle of its businesses.
    Though analyzing the profitability, efficiency and financial stability, the financial condition of the two organizations is much clearer. In order to give them a comprehensive analysis and make future investment decisions, other factors that would be relevant to their performance are considered, such as customers, competitors, business strategy and markets.

     

    3.0 Profitability

    -Among the provided ratios, gross profit margin, net profit margin (after tax), return on equity, return on asset are contribute to analyze the two organizations’ profitability.

    3.1 Fantastic Holdings Limited’s profitability

    -With regard to Fantastic Holdings Limited, except for return on equity, its gross profit margin, net profit margin (after tax) and return on asset all have a rise from 2011 to 2012. As given in the 
     

    4.0 Efficiency

    -Among the provided ratios, asset turnover (times), inventory turnover (days), debtors turnover (days) and creditors turnover (days) are contribute to analyze the two organizations’ efficiency.

    4.1 Fantastic Holdings Limited’s efficiency

    -With regard to Fantastic Holdings Limited, except for asset turnover (times), the other three ratios all have a rise from 2011 to 2012, which is a good signal. The annual report shows that, Imports Warehouse in Fairfield, New South Wales saw another major restructure. To provide optimum storage density and throughput efficiency with the smallest facility footprint, the project, ‘VNA’ (Very Narrow Aisles) was undertaken to install the appropriate material handling equipment, which is expected to bring greater operational efficiency, provide sustainable customer service levels and cut down cost of doing business.

    4.2 Super Retail Group Limited’s efficiency

    -With regard to Super Retail Group Limited, in 2012, its inventory turnover (days) and debtors turnover (days) do better in efficiency compared to 2011.However, its asset turnover (times) and creditors turnover (days) has a decrease in efficiency. As shown in Table 2, the asset has a rapid increase as a result of massive growth in contributed equity, so asset turnover (times)’s decrease is not the result of poor efficiency. As to decrease in inventory turnover (days) and debtors turnover (days), it is the result of Super Retail Group Limited’s continuing invests in developing its logistics operations, which provides more efficient support for their businesses. What is more, the warehouse management systems were successfully upgraded and the New Zealand logistics operations were successfully relocated into a larger distribution centre towards the end of the year, Super Retail Group Limited’s risk management, internal compliance and control system is operating efficiently and effectively in all material respects.

    4.3 Comparison between the two organizations

    -Compare the two organizations, Fantastic Holdings Limited’s asset turnover (times) is nearly twice as much as that of Super Retail Group Limited’ ratio, what is more, Fantastic Holdings Limited’s inventory turnover (days), debtors turnover (days) and creditors turnover (days) only half of the Super Retail Group Limited’ corresponding ratios, which reflect the fact that it has a 
     
     

    5.0 Financial Stability

    -Among the provided ratios, current ratio and quick ratio contribute to analyze the two organizations’ financial stability in the short term, debt asset ratio (total debt), debt equity ratio (total debt) and times interest earned (times) contribute to analyze the two organizations’ financial stability in the long term.

    5.1 Fantastic Holdings Limited’s financial stability

    -With regard to Fantastic Holdings Limited, its current ratio has a decrease while the quick ratio has an increase from 2011 to 2012. The change reflects a reduction in inventory, which also can be certified by the information in Table 3.With regard to Inventory Management, compared to PCP, the annual report also mentions that there is a reduction of $3.7 million in group inventory. From its debt asset ratio (total debt), debt equity ratio (total debt) and times interest earned (times), it can be find that the debt asset ratio times remains the level of 40%-low risk of debt, and interest earned (times) has doubled over the year, which reflect Fantastic Holdings Limited’ great financial stability in the long term. As interest payable on borrowings, interest receivable on funds invested and dividend income belongs to financial income and expense comprise, increase in times interest earned (times) comes from high financial income, high profit before tax and low financial expense, which is shown in the Table 4.

    5.2 Super Retail Group Limited’s financial stability

    -With regard to Super Retail Group Limited, its current ratio has a decrease while the quick ratio remains stable from 2011 to 2012, which is not a good signal. From its debt asset ratio (total debt), debt equity ratio (total debt) and times interest earned (times), it can be find that the debt has a increase and the debt paying ability decrease. The Table 5 shows that increase in current liabilities mainly the result of increasing trade and other payables, while increase in total current assets mainly the result of increasing inventories. What is more, trade and other receivables is far more than trade and other payables, which reflects Super Retail Group Limited’s disadvantage in transaction. The table 6 shows that increase in debt asset ratio mainly the result of increasing long-term borrowings and deferred tax liabilities. These all go ill with increasing Super Retail Group Limited’s financial stability.

    5.3 Comparison between the two organizations

    -Compare the two organizations, Super Retail Group Limited has a higher current ratio while the quick ratio is lower, which reflects its assets’ rapid liquidity is weaker. What is more, Super Retail Group Limited has a high debt asset ratio and quite low times interest earned (times), which reflects its weaker financial stability in the long term.
     

    6. Additional or Other information

    -In 2012, key members of its product design is relocated by Fantastic Holdings Limited, sourcing and quality control team is set up in Dongguan (China), under the sponsorship of the Managing Director, which increase its capacity to establish ongoing supplier partnerships, cut down costs of product and improve standards of quality control (au.investsmart.com.au).
    - A WMS solution with the scalability was needed to implement by Fantastic Holdings Limited to support its various products and brands. As Manhattan SCALE’s performance in seamlessly integrate with the company’s existing IT systems, including its ERP platform, it was selected by Fantastic Holdings Limited.
    Since the solution was implemented, order accuracy was improved, operational efficiency was increased, visibility and seamless was enhanced, real-time integration with the company’s Dynamics AX ERP system was achieved (manh.cn).
    -With regard to Super Retail Group Limited, it announced in 2011 that an agreement was reached with Archer Capital, it would pay AUD 610 million to acquire Rebel Group Limited (Rebel), which includes 90 Rebel Sport stores, 36 Amart stores and two Performance Sports stores. The underwritten AUD 334 million Entitlement Offer and an increase in the Group's existing debt facilities will be used to pay the expense by Super Retail Group Limited (reuters.com)
    -September 12, 2012, Velocity Brand Management (VBM) today announced that 50 percent of its retail business was acquired by Super Retail Group (SRG). In a partnership with VBM, Super Retail Group Limited will significantly expand its retail presence (4-traders.com).
     

    7.0 Limitations

    -The analysis is mainly based on the annual report, it is acknowledged that financial statements usually reflect the operating results of enterprises in a certain period, which put emphasis on results and cannot reflect its economic content. Some events that reflect the content of the financial statements are not effectively reflected, which affects the analysis and evaluation of the enterprise (Bay, 2011).

    8.0 Recommendations

    -Compared to Super Retail Group Limited, Fantastic Holdings Limited does better in profitability, efficiency and financial stability. Super Retail Group Limited should pay more attention to its liabilities, which may influence its reputation if it can’t repay the borrowings on time. Super Retail Group Limited also should put more emphasis on increasing its efficiency of assets, which 
     

    9.0 References

    au.investsmart.com.au. Strategy Analysis.[online]. Available from:
    http://au.investsmart.com.au/shares/asx/FANTASTIC-HOLDINGS-LIMITED-FAN.asp. Accessed on: April 20, 2013.
     
    Bay, C. (2011).Framing financial responsibility: An analysis of the limitations of accounting. Critical Perspectives on Accounting: 6(22), 593–607.
     
    4-traders.com. Super Retail Group Ltd : Acquisition of 50% of VBM Retail Pty Limited. [online]. Available from: http://www.4-traders.com/SUPER-RETAIL-GROUP-LTD-6497169/news/Super-Retail-Group-Ltd-Acquisition-of-50-of-VBM-Retail-Pty-Limited-15197696/. Accessed on: April 22, 2013.
     
    manh.cn. Fantastic Holdings Ltd Optimises Distribution Capabilities with Manhattan Associates. [online]. Available from: http://www.manh.cn/resources/case-study/fantastic-holdings-ltd-optimises-distribution-capabilities-manhattan-associates. Accessed on: April 21, 2013.
     
    reuters.com, 2011. Super Retail Group Limited To Acquire Rebel Group Limited From Archer Capital. [online]. Available from: http://www.reuters.com/finance/stocks/SUL.AX/key-developments/article/2415399. Accessed on: April 20, 2013.
     
    retail-business-review.com. Fantastic Holdings Limited. [online]. Available from: http://www.retail-business-review.com/companies/fantastic_holdings_limited. Accessed on: April 20, 2013.