Question 1.2: Financial performance for European oil companies: (5p.) Please find below cash flow versus earnings...

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Question 1.2: Financial performance for European oil companies: (5p.) Please find below cash flow versus earnings for the three major European oil companies. 2013 (US$ m) BP (UK) Total (France) Shell (UK) Revenues 65,953 51,171 112,367 Gross profit 27,324 21,563 37,256 EBIT 22,930 17,145 16,378 Effective tax rate 18% 34% 2396 NOPAT 18,803 11,316 12,611 Depreciation and amortization 7,269 5,086 4,049 Capital expenditure -22,243 -13,001 -9,587 Change in net working capital 642 Enterprise Free Cash Flow 4,471 207 3,608 2,599 9,672 A (3p.) Derive at least two profitability ratios for all three companies. Which one do you prefer to assess company performance? Motivate your answer. B (2p.) Which one of the three companies is the best performing company in 2013? Motivate your answer by referring to ratios based on earnings and cash flows. Question 1.2: Financial performance for European oil companies: (5p.) Please find below cash flow versus earnings for the three major European oil companies. 2013 (US$ m) BP (UK) Total (France) Shell (UK) Revenues 65,953 51,171 112,367 Gross profit 27,324 21,563 37,256 EBIT 22,930 17,145 16,378 Effective tax rate 18% 34% 2396 NOPAT 18,803 11,316 12,611 Depreciation and amortization 7,269 5,086 4,049 Capital expenditure -22,243 -13,001 -9,587 Change in net working capital 642 Enterprise Free Cash Flow 4,471 207 3,608 2,599 9,672 A (3p.) Derive at least two profitability ratios for all three companies. Which one do you prefer to assess company performance? Motivate your answer. B (2p.) Which one of the three companies is the best performing company in 2013? Motivate your answer by referring to ratios based on earnings and cash flows.