Sign In
Not register? Register Now!
Essay Available:
Pages:
7 pages/≈1925 words
Sources:
3 Sources
Style:
APA
Subject:
Accounting, Finance, SPSS
Type:
Case Study
Language:
English (U.S.)
Document:
MS Word
Date:
Total cost:
$ 32.76
Topic:

Next PLC’s Profitability, Efficiency, and Liquidity

Case Study Instructions:

The word count:
1.The word limit for the case study/report is 1,800 words. However, a +10% range is permitted, i.e., a maximum 1,980 words. You will be penalized if your work is less than the minimum word-length and above the maximum word-length specified. There will be a penalty of a deduction of 10% of the mark for work exceeding the word limit by 10% or more.
2.The word limit includes tables, figures, quotations and citations, but excludes the references list. Appendices should NOT be used, i.e. please include all relevant data in the main part of the case study/report.
3.You should state the word count on the front page of your report.
The Case Study/Report
You should write answers to each of (a), (b) and (c) as three parts of the main body of a single case study/report to the non-financial directors of Next plc, using the 2021/2022 Annual Report (see copy of full report in the Assessment folder on the module Blackboard site):
(a)Analyse and discuss the 2021/2022 Next plc?s financial statements considering the company?s profitability, efficiency and liquidity. You must also compare the results with 2020/2021 (two ratios for each area) ? (see copy of full annual report for year 2020/2021 in the Assessment folder on the module Blackboard site). (Marks: 35%)
(b)In its 2021/2022 annual report (page 89), Next plc pledged:
?Our stakeholder relationships are key to our success and inform our decision making on Environmental, Social and Governance (ESG)matters, now a widely recognised term for what we have always valued ? doing the right thing. We have made good progress on setting our near term and longer-term aspirations but we realise there is still more to do? In July 2021, our targets to reduce our Scope 1 and 2 carbon emissions were approved by the Science Based Target Initiative (SBTi). We also signed up to the EV100, committing to switching our car and van fleets to electric vehicles by 2030.?
Now, and also considering Next plc?s 2020/2021 annual report, compare and discuss briefly the pledges Next plc made in respect of corporate social reporting. You need to illustrate your discussion with relevant examples. (Marks: 25%)
(c)Explain what you understand by the term ?foreign exchange? and ?foreign exchange market?. As a British multinational clothing, footwear and home products retailer, discuss briefly how does foreign exchange market affect the international businesses of Next plc.

Case Study Sample Content Preview:

Case Study/Report
Student Full Name
Institutional Affiliation
Course Full Title
Instructor Full Name
Due Date
Case Study/Report
* Next plc’s Profitability, Efficiency, And Liquidity
The three financial ratios that will be used to evaluate Next plc’s capacity to generate earnings in relation to its operating expenses, revenue, and balance sheet assets are net profit ratio, dividend payout ratio, and price earnings ratio. Net profit margin is a critical financial ratio in determining a company’s profitability in terms of net sales and net profit after tax. It is determined by dividing net profit after tax by net sales and is expressed as a percentage. Net plc’s net profit after tax and net sales for the year 2022 were £677.5 million and £4,625.9 million respectively: the company’s net profit margin for 2022 was 14.6% (Next plc, 2022). Conversely, Net plc’s net profit after tax and net sales for the year 2021 were £286.7 million and £3,534.4 million respectively: the company’s net profit margin for 2021 was 8.1% (Next plc, 2021). Dividend payout ratio is another crucial financial ratio that calculates profitability in terms of the amount paid to shareholders. It is determined by dividing dividends per share by earnings per share. Net plc’s dividends per share and earnings per share for the year 2022 were 160 and 3.098 respectively: the company’s dividend payout ratio for 2022 was 0.52.
Conversely, Net plc’s dividends per share and earnings per share for the year 2021 were 57.50 and 3.002 respectively: the company’s dividend payout ratio for 2021 was 0.19 (Next plc, 2021). The third profitability ratio is price earnings ratio, which determines a company’s ability to generate earnings by establishing the association between its stock price and its earnings per share. It is determined by dividing market value share by earnings per share. Net plc’s stock price and earnings per share for the year 2022 were 46.78 and 2.309 respectively: the company’s price earnings ratio for 2022 was 15.1 (Next plc, 2022). Conversely, Net plc’s stock price and earnings per share for the year 2021 were 95.76 and 3.002 respectively: the company’s price earnings ratio for 2021 was 31.9. In conclusion, between 2021 and 2022, Next plc recorded an improvement in its profitability in terms of net sales, net profit after tax, and amount paid to shareholders although it also saw a marked decrease in its ability to generate earnings in terms of earnings per share.
The three financial ratios that will be used to evaluate Next plc’s capacity to produce revenues from the dollars invested in company operations are accounts receivable turnover ratio, efficiency ratio, and asset turnover. The accounts receivable turnover ratio determines how well an organizations collects revenues from customers for purchased goods within the required deadline. The receivable turnover ratio is obtained by dividing net sales by average accounts receivable. Net plc’s net sales and average accounts receivable for the year 2022 were £4,625.9 million and £1,062 million respectively: the company’s receivable turnover ratio...
Updated on
Get the Whole Paper!
Not exactly what you need?
Do you need a custom essay? Order right now:
Order

👀 Other Visitors are Viewing These APA Case Study Samples:

HIRE A WRITER FROM $11.95 / PAGE
ORDER WITH 15% DISCOUNT!
Order Now