Appraisal of the Financial Performance of Distil PLC & Recommendations on How the Performance Can be Enhanced

Appraisal of the Financial Performance of Distil PLC & Recommendations on How the Performance Can be Enhanced
[By:]
[Presented To:]
[Name of Institution:]
[Date
Task 1: Evaluation of the performance of the company across all categories of ratios
(£ 000)

2018

2019

2020

Liquidity Ratios

£ 000

£ 000

£ 000

Current Ratio
=Current AssetsCurrent Liabiliities

1603235
= 6.8

158798
= 16.2

1750126
= 13.8

Quick Ratio
=Current Assets-InventoriesCurrent Liabilities

1603-177235
= 6.07

1587-31298
= 13.01

1750-349126
=11.12

Inventory Days
=InventoryCost of Sales(Purchases)×365

177842×365
= 76.7days

312972×365
= 117.2 days

349×365995
= 128 days

Receivable Days
=Trade ReceivableSales and Other Operating Revenue×365

3952014×365
= 71.6days

2072401×365
= 31.5 days

543×3652441
= 81.2 days

Payable Days
=Trade PayablesCost of Sales(Purchases)×365

235842×365
= 101.9 days

98972×365
= 36.8 days

126×365995
= 46.2 days

Solvency Ratio




Gearing
= Long Term and Short Term BorrowingEuity×100%

235+03014
= 7.8%

98+03174
= 3.09%

126+03430
= 3.7%

Profitability Ratios




Operating Profit Margin
=Operating ProfitRevenue×100%

1572014
= 7.8%

1602401
= 6.7%

1822441
= 7.5%

ROA (Return on Asset)
=Net IncomeTotal Asset

1573249
= 0.04832

1603272
= 0.04889

1823556
= 0.05118

ROE (Return on Equity)
=Net IncomeShareholders Equity

1571292
= 0.1215

1601292
= 0.1238

1821292
= 0.1409

Efficiency Ratios




Asset Turnover Ratio
= Total RevenueTotal Asset

20143249
= 0.6199

24013272
= 0.7338

24413556
= 0.6864

Revenue Per Employee
= Total RevenueThe Number of Employees

20147
= 287.7

24016
= 400.2

24417
= 348.7

Performance Ratios








Diluted/Diluted EPS (From Income Statement)(pence per share)

0.03

0.03

0.05





ROCE
=Profit Before Interest and TaxEquity+Long Term Borrowing

1573014+0
= 0.0521

1603174+0
= 0.0504

1823430+0
= 0.0531





Liquidity Ratio analysis
Liquidity ratios help to determine if the company is able to take care of itsshort-term debts efficiently. The current ratio for Distil Plc has consistently increased with a margin of 9.4 in 2019 compared to 2018 and slightly dropped to 13.8 in 2020.Generally the liquidity ratio of Distil PLC has progressively increased in all aspects. Quick ratio, inventory days and receivable days have continuously increased from 2018 to 2020. Quick ratio in 2020 is at 11.12 from 6.07 in 2018.Increase in quick ratio shows that Distil Plc can be able to pay its debts without requirin...