FOLLOW THE STEPS OUTLINED BELOW TO OBTAIN THE DATA NEEDED FOR THE GROUP 1. On theWSU Library
Question:
FOLLOW THE STEPS OUTLINED BELOW TO OBTAIN THE DATA NEEDED FOR THE GROUP
1. On theWSU Library website home page, from the "Collections" drop down tab, click one-Resourcesand under theDatabases by Title section, click on the letter "D", then pick theDatAnalysis Premiumdatabase. Once in the database, go to the search engine bar on the top right-hand side of the page, and enter each the following company's name or ASX code:
- Atlas Pearls Ltd (ASX code: ATP)
- Embelton Limited (ASX code: EMB)
For each company, the displayed page summarises general information about the company including the sector and industry in which it operates, total market capitalisation of the firm, latest closing share price, etc.
2. Each firm operates in adifferentIndustry Group.
- Atlas Pearls Ltd operates in theConsumer Durables and Apparelindustry group.
- Embelton Limited operates in theCapital Goodsindustry group
3. On the left-hand side, click on"Financial Data".The displayed page shows annual and interim information for your assigned companies (in the view bar, make sure you choose annual and not interim data). On the page's control bar at the top, you will see the first three icons, which displays the company's summarisedannual financial statements(income statement (profit & loss statement), balance sheet, etc.).
4. The figures shown on the Financial Data page are rounded figures and arenot to be usedin the calculation of ratios. To access the raw figures for your ratio calculations, select the relevant time period (i.e., 2021 to 2022) from the 'year range' drop down bars, and click on 'go'. Once the figures appear, click on the 'download spreadsheet' button. This will download an Excel file that contains all the relevant financial statements i.e., Profit & Loss Statement, Balance Sheet, etc. for both 2021and2022.
5. In the downloaded Excel file, you will see a sheet titled "Revenue/Expense" in which you can locate theCost of goods sold (COGS)for each company for the different years. This is the figure you will employ as the Cost of Goods Sold, if any ratio calculations/ratio analysis require it. Remember todisregard the minus sign in front of the COGS figure and remove the minus sign prior to using the COGS figure in your ratio calculations.The minus sign denotes that COGS is an expense item.
6. For more detailed information about how to obtain the data required for your group assignment, please watch the'How to Obtain Data for the Group Assignment'video. The video is located in theAssessment Zone under the Assessment 2: Numerical Problem Solvinglink. Ideally,allgroup members should watch this videopriorto commencing the assignment.
WHAT IS REQUIRED You work as part of a team of equity investment analysts at Aristide Wealth Management, reporting to the Chief Investment Officer (CIO), Geneva Thurston. The CIO has identified two companies as potential investments. Your team has been tasked by the CIO to analyse the financial position and performance of the above assigned companies for the two stated financial years (2021 and 2022), and to provide a recommendation as to which may be the most profitable company for Aristide Wealth Management to invest into, if any. Your task involves answering the following five (5) questions in your own words (i.e., do not simply "cut and paste" information from the Annual Report or any other source). You must apply critical thinking concepts when explaining and justifying your choices. NB: Ensure that you refer to the marking criteria and important notes and information contained in this document prior to commencing the assignment. BASED ON THE INFORMATION AVAILABLE ON THE DatAnalysis Premium DATABASE FOR BOTH ASSIGNED COMPANIES, ANSWER ALL OF THE FOLLOWING QUESTIONS (1 TO 5 INCLUSIVE).
QUESTION 1: Analyse the overall liquidity position for each of the two companies in 2022 as compared to 2021. Calculate the values for two liquidity ratios to help support your answer and justify why you have chosen these ratios. Note: ensure that you analyse in this question, not just describe the ratio values. (2 marks)
QUESTION 2: Analyse the sources of finance for each of the two companies in 2022 as compared to 2021. Use two capital structure ratios to support your answer and provide an explanation regarding the changes in the composition of the sources of finance for each enterprise. Note: ensure that you analyse in this question, not just describe the ratio values. (3 marks)
QUESTION 3: Analyse the ability of management to manage their fixed assets and total assets for each of the two companies in 2022 as compared to 2021. Use two Asset Management efficiency ratios to support your answer and explain any change in each companies' ability to use their assets to generate sales. Note: ensure that you analyse in this question, not just describe the ratio values. (2 marks)
QUESTION 4: Using the DuPont method, analyse the profitability of each of the two companies in 2022 as compared to 2021 from a shareholder's point of view. Based on your calculations, explain the main reason(s) for the change in the profitability for each company over the two years. Note: ensure that you analyse in this question, not just describe the ratio values. (3 marks)
QUESTION 5: Given your answers and analysis in Questions 1 to 4, what is your final recommendation to the Chief Investment Officer at Aristide Wealth Management, with regards to the potential of investing in any of the two firms? Discuss the basis for your recommendation. Ensure you base your recommendation only on the change in the ratios for the two stated financial years (i.e., 2021 and 2022). (4 marks)
3 NOTES AND IMPORTANT INFORMATION
1. All ratios must be selected from those identified in your prescribed textbook (Bakry 2020). The use of ratios other than those identified in the prescribed textbook and discussed in class will not gain any marks. Include all supporting calculations for any values shown in Questions 1 to 5 in the Appendix. The Appendix is NOT included in the word count.
Note: Marks will NOT be awarded if no supporting ratio calculations are shown in the Appendix. 2. In questions 1-4, an analysis is required and not just a description of the ratio. That means you need to explain how the ratio changed over time and what are the main reason(s) for that change, and how that will impact the company's financial position. The aim of the assignment is to examine and analyse the change in the firm's financial position and performance based only on your calculated ratios. Each company must be compared to itself over the period under examination. DO NOT compare the companies to each other nor should you compare the companies to the industry in which they operate. 3. The assignment does not require the obtainment of industry/peer group averages for any of the calculated ratios. Procurement and incorporation of industry averages into your assignment answers will not gain any additional marks. Nor will students gain any marks for providing extraneous information about the industry groups in which the two firms operate.
4. Question 5 requires you to synthesise the analyses from questions 1-4 to formulate a well-justified argument/conclusion, which is both logical and critical. Question 5 has its own criteria in the marking guide, which you need to refer to.
5. In calculating the ratios, assume that the "Sales" are the "Operating Revenues" (available in the Profit & Loss statement).
6. In calculating the ratios, ignore Abnormals. You should only use figures before abnormals such as, 'Net profit after tax before abnormals'.
7. Ratios calculated by the Morningstar analyst and available within the database are not to be used as guidance for calculating your ratios. The analyst has calculated some of the ratios using formulas different to the ratios covered in BUSM1010 Financing Enterprises.
8. Reference List Include any references you have used and cited in your assignment. Make sure all answers are fully referenced using the Harvard referencing system, including in-text citations and a reference list at the end of your assignment. Only scholarly references are to be utilised. For guidelines on using the WSU Harvard referencing system see: https://library.westernsydney.edu.au/main/sites/default/files/cite_Harvard.pdf Note: The Reference List is NOT included in the word count.
9. Group Assignment Cover Sheet Group assignments are to be submitted with a WSU group assignment cover sheet with ALL team members' names and student IDs clearly stated. You are NOT allowed to exclude team member names from the Group Assignment Cover Sheet. Assignments submitted without a cover sheet will NOT be marked. The Group Assignment cover sheet can be downloaded from the Group Assignment Cover Sheet sections in the Numerical Problem Solving folder, located in the Assessment Zone on our vUWS site.
| ASX Code | Company Name | Item | 08/14 | 03/15 | 03/16 | 03/17 | 03/18 | 03/19 | 03/20 | 12/20 | 12/21 | 12/22 |
| EVO | Embark Education Group Limited | Operating Revenue | -- | 32.940.000,00 | 123.764.864,00 | 138.300.456,00 | 149.307.721,00 | 44.128.519,00 | 53.044.749,00 | 26.429.442,00 | 48.695.897,00 | 18.492.204,00 |
| EVO | Embark Education Group Limited | Other Revenue | -- | 518.000,00 | 1.218.018,00 | 168.036,00 | 0,00 | 87.241.907,00 | 84.039.192,00 | 69.809.657,00 | 99.929.431,00 | 37.076.836,00 |
| EVO | Embark Education Group Limited | Total Revenue Excluding Interest | -- | 33.458.000,00 | 124.982.882,00 | 138.468.493,00 | 149.307.721,00 | 131.370.427,00 | 137.083.942,00 | 96.239.099,00 | 148.625.329,00 | 55.569.041,00 |
| EVO | Embark Education Group Limited | Operating Expenses | -- | -32.765.000,00 | -101.096.396,00 | -113.271.232,00 | -128.989.291,00 | -119.560.429,00 | -109.962.952,00 | -57.490.857,00 | -114.297.139,00 | -35.477.546,00 |
| EVO | Embark Education Group Limited | EBITDA | 0,00 | 693.000,00 | 23.886.486,00 | 25.197.260,00 | 20.318.429,00 | 11.809.998,00 | 27.120.990,00 | 38.748.241,00 | 34.328.189,00 | 20.091.494,00 |
| EVO | Embark Education Group Limited | Depreciation | -- | -302.000,00 | -1.519.819,00 | -1.851.141,00 | -2.462.896,00 | -2.566.558,00 | -13.501.023,00 | -10.192.217,00 | -13.829.506,00 | -12.747.642,00 |
| EVO | Embark Education Group Limited | Amortisation | -- | -137.000,00 | -423.423,00 | -549.771,00 | -581.439,00 | -361.041,00 | -156.965,00 | -56.258,00 | -60.218,00 | 0,00 |
| EVO | Embark Education Group Limited | Depreciation and Amortisation | -- | -439.000,00 | -1.943.243,00 | -2.400.913,00 | -3.044.335,00 | -2.927.600,00 | -13.657.989,00 | -10.248.476,00 | -13.889.725,00 | -12.747.642,00 |
| EVO | Embark Education Group Limited | EBIT | 0,00 | 254.000,00 | 21.943.243,00 | 22.796.347,00 | 17.274.093,00 | 8.882.398,00 | 13.463.000,00 | 28.499.765,00 | 20.438.464,00 | 7.343.852,00 |
| EVO | Embark Education Group Limited | Interest Revenue | -- | 191.000,00 | 143.243,00 | 94.977,00 | 44.148,00 | 136.946,00 | 428.000,00 | 136.896,00 | 216.409,00 | 343.572,00 |
| EVO | Embark Education Group Limited | Interest Expense | -- | -1.853.000,00 | -1.130.630,00 | -1.247.488,00 | -1.541.424,00 | -2.784.907,00 | -19.094.277,00 | -11.910.923,00 | -19.237.862,00 | -8.691.065,00 |
| EVO | Embark Education Group Limited | Net Interest Expense | -- | -1.662.000,00 | -987.387,00 | -1.152.511,00 | -1.497.275,00 | -2.647.960,00 | -18.666.276,00 | -11.774.027,00 | -19.021.452,00 | -8.347.493,00 |
| EVO | Embark Education Group Limited | PreTax Profit | -- | -1.408.000,00 | 20.955.855,00 | 21.643.835,00 | 15.776.817,00 | 6.234.437,00 | -5.203.275,00 | 16.725.738,00 | 1.417.011,00 | -1.003.641,00 |
| EVO | Embark Education Group Limited | Tax Expense | 0,00 | -123.000,00 | -4.994.594,00 | -5.926.027,00 | -4.349.990,00 | -1.695.077,00 | 4.026.518,00 | -2.617.909,00 | -687.805,00 | -668.471,00 |
| EVO | Embark Education Group Limited | Net Profit after Tax Before Abnormals | 0,00 | -1.531.000,00 | 15.961.261,00 | 15.717.808,00 | 11.426.826,00 | 4.539.360,00 | -1.176.757,00 | 14.107.829,00 | 729.205,00 | -1.672.112,00 |
| EVO | Embark Education Group Limited | Abnormals | 0,00 | -6.527.000,00 | -1.869.369,00 | -1.221.917,00 | -15.997.557,00 | -102.603.907,00 | -11.789.997,00 | -7.009.845,00 | -31.990,00 | -742.227,00 |
| EVO | Embark Education Group Limited | Abnormals Tax | 0,00 | 0,00 | 0,00 | 0,00 | 613.375,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 |
| EVO | Embark Education Group Limited | Net Abnormals | 0,00 | -6.527.000,00 | -1.869.369,00 | -1.221.917,00 | -15.384.181,00 | -102.603.907,00 | -11.789.997,00 | -7.009.845,00 | -31.990,00 | -742.227,00 |
| EVO | Embark Education Group Limited | Reported NPAT After Abnormals | 0,00 | -8.058.000,00 | 14.091.891,00 | 14.495.890,00 | -3.957.354,00 | -97.255.315,00 | -12.966.754,00 | 7.097.984,00 | 697.214,00 | -41.075.529,00 |
| EVO | Embark Education Group Limited | Outside Equity Interests | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 |
| EVO | Embark Education Group Limited | Shares Outstanding at Period End | 132.317.278,00 | 177.082.724,00 | 177.576.018,00 | 178.278.256,00 | 179.460.596,00 | 180.278.557,00 | 1.118.603.993,00 | 139.825.639,00 | 159.549.484,00 | 159.549.484,00 |
| EVO | Embark Education Group Limited | Weighted Average Number of Shares | 0,00 | 62.392.887,00 | 177.222.895,00 | 178.007.882,00 | 178.948.343,00 | 323.504.713,00 | 924.079.125,00 | 139.825.639,00 | 154.037.615,00 | 159.549.484,00 |
| EVO | Embark Education Group Limited | EPS Adjusted (cents/share) | 0,00 | -2,45 | 9,01 | 8,83 | 6,39 | 1,40 | -0,13 | 10,09 | 0,47 | -1,05 |
| EVO | Embark Education Group Limited | EPS After Abnormals (cents/share) | 0,00 | -12,91 | 7,95 | 8,14 | -2,21 | -30,06 | -1,40 | 5,08 | 0,45 | -25,74 |
| ASX Code | Company Name | Item | 06/13 | 06/14 | 06/15 | 06/16 | 06/17 | 06/18 | 06/19 | 06/20 | 06/21 | 06/22 | 06/23 |
| ATP | Atlas Pearls Ltd | Operating Revenue | 3.486.496,00 | 15.933.177,00 | 11.774.319,00 | 18.042.174,00 | 16.301.591,00 | 14.160.084,00 | 16.202.307,00 | 13.740.385,00 | 18.280.749,00 | 21.507.913,00 | 27.200.159,00 |
| ATP | Atlas Pearls Ltd | Other Revenue | 1.754.041,00 | 1.427.952,00 | 4.158.770,00 | 3.652.220,00 | 1.857.606,00 | 533.122,00 | 654.836,00 | 956.837,00 | 4.562.534,00 | 2.629.544,00 | 813.316,00 |
| ATP | Atlas Pearls Ltd | Total Revenue Excluding Interest | 5.240.537,00 | 17.361.129,00 | 15.933.089,00 | 21.694.394,00 | 18.159.197,00 | 14.693.206,00 | 16.857.143,00 | 14.697.222,00 | 22.843.283,00 | 24.137.457,00 | 28.013.475,00 |
| ATP | Atlas Pearls Ltd | Operating Expenses | -10.218.394,00 | -15.099.638,00 | -22.035.989,00 | -17.335.711,00 | -16.475.810,00 | -15.813.957,00 | -16.823.595,00 | -20.824.840,00 | -17.839.824,00 | -18.159.441,00 | -17.948.496,00 |
| ATP | Atlas Pearls Ltd | EBITDA | -4.977.857,00 | 2.261.491,00 | -6.102.900,00 | 4.358.683,00 | 1.683.387,00 | -1.120.751,00 | 33.548,00 | -6.127.618,00 | 5.003.459,00 | 5.978.016,00 | 10.064.979,00 |
| ATP | Atlas Pearls Ltd | Depreciation | -136.160,00 | -302.686,00 | -588.557,00 | -398.575,00 | -308.061,00 | -255.602,00 | -233.070,00 | -523.209,00 | -447.984,00 | -225.996,00 | -290.944,00 |
| ATP | Atlas Pearls Ltd | Amortisation | 0,00 | 0,00 | 0,00 | 0,00 | -161.969,00 | 0,00 | -64.185,00 | -102.803,00 | -25.187,00 | -86.262,00 | 0,00 |
| ATP | Atlas Pearls Ltd | Depreciation and Amortisation | -136.160,00 | -302.686,00 | -588.557,00 | -398.575,00 | -470.030,00 | -255.602,00 | -297.255,00 | -626.012,00 | -473.171,00 | -312.258,00 | -290.944,00 |
| ATP | Atlas Pearls Ltd | EBIT | -5.114.017,00 | 1.958.805,00 | -6.691.457,00 | 3.960.108,00 | 1.213.357,00 | -1.376.353,00 | -263.707,00 | -6.753.630,00 | 4.530.288,00 | 5.665.758,00 | 9.774.035,00 |
| ATP | Atlas Pearls Ltd | Interest Revenue | 18.629,00 | 13.333,00 | 9.411,00 | 57.335,00 | 53.813,00 | 48.605,00 | 52.207,00 | 48.473,00 | 2.262,00 | 11.751,00 | 14.067,00 |
| ATP | Atlas Pearls Ltd | Interest Expense | -240.532,00 | -513.496,00 | -473.131,00 | -414.270,00 | -462.683,00 | -331.386,00 | -373.354,00 | -368.301,00 | -445.836,00 | -249.842,00 | -74.213,00 |
| ATP | Atlas Pearls Ltd | Net Interest Expense | -221.903,00 | -500.163,00 | -463.720,00 | -356.935,00 | -408.870,00 | -282.781,00 | -321.147,00 | -319.828,00 | -443.574,00 | -238.091,00 | -60.146,00 |
| ATP | Atlas Pearls Ltd | PreTax Profit | -5.335.920,00 | 1.458.642,00 | -7.155.177,00 | 3.603.173,00 | 804.487,00 | -1.659.134,00 | -584.854,00 | -7.073.458,00 | 4.086.714,00 | 5.427.667,00 | 9.713.889,00 |
| ATP | Atlas Pearls Ltd | Tax Expense | 1.471.927,00 | 355.280,00 | -521.240,00 | -1.819.042,00 | 96.094,00 | -49.983,00 | -2.407.607,00 | -1.101.760,00 | -1.355.790,00 | -836.116,00 | -626.145,00 |
| ATP | Atlas Pearls Ltd | Net Profit after Tax Before Abnormals | -3.863.993,00 | 1.813.922,00 | -7.676.417,00 | 1.784.131,00 | 900.581,00 | -1.709.117,00 | -2.992.461,00 | -8.175.218,00 | 2.730.924,00 | 4.591.551,00 | 9.087.744,00 |
| ATP | Atlas Pearls Ltd | Abnormals | 1.669.348,00 | 0,00 | -457.632,00 | -816.028,00 | 0,00 | -324.982,00 | -590.000,00 | 98.390,00 | 3.989.000,00 | 0,00 | 0,00 |
| ATP | Atlas Pearls Ltd | Abnormals Tax | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 |
| ATP | Atlas Pearls Ltd | Net Abnormals | 1.669.348,00 | 0,00 | -457.632,00 | -816.028,00 | 0,00 | -324.982,00 | -590.000,00 | 98.390,00 | 3.989.000,00 | 0,00 | 0,00 |
| ATP | Atlas Pearls Ltd | Reported NPAT After Abnormals | -2.194.645,00 | 1.813.922,00 | -8.134.049,00 | 968.103,00 | 900.581,00 | -2.034.099,00 | -3.582.461,00 | -8.076.828,00 | 6.719.924,00 | 4.591.551,00 | 9.087.744,00 |
| ATP | Atlas Pearls Ltd | Outside Equity Interests | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 | 0,00 |
| ATP | Atlas Pearls Ltd | Shares Outstanding at Period End | 287.038.778,00 | 319.485.425,00 | 414.327.191,00 | 419.380.906,00 | 417.947.482,00 | 424.809.620,00 | 424.809.620,00 | 424.809.620,00 | 424.809.620,00 | 424.809.620,00 | 427.871.758,00 |
| ATP | Atlas Pearls Ltd | Weighted Average Number of Shares | 271.638.917,00 | 297.634.113,00 | 339.521.538,00 | 415.837.428,00 | 421.525.077,00 | 422.218.298,00 | 424.809.620,00 | 424.809.620,00 | 424.809.620,00 | 424.809.620,00 | 424.809.620,00 |
| ATP | Atlas Pearls Ltd | EPS Adjusted (cents/share) | -1,42 | 0,61 | -2,26 | 0,43 | 0,21 | -0,40 | -0,70 | -1,92 | 0,64 | 1,08 | 2,14 |
| ATP | Atlas Pearls Ltd | EPS After Abnormals (cents/share) | -0,81 | 0,61 | -2,40 | 0,23 | 0,21 | -0,48 | -0,84 | -1,90 | 1,58 | 1,08 | 2,14 |
Expert Answer:
Embark Education Group Limited Current Assets 2021 5000000 2022 6000000 Current Liabilities 2021 300... View the full answer
Strategic Management Concepts And Cases A Competitive Advantage Approach
ISBN: 9780136120988
13th Edition
Authors: Fred R. David
