ACCOUNTING AND FINANCE

Accounting and Finance: Immedia Group PLC



Accounting and Finance: Immedia Group PLC

Introduction

The Immedia Group PLC is a UK based company. The company has listings of its shares on London Stock Exchange. The group provides the services of live radio stations for British retailers. The main marketing services of the company are bespoke radio provisioning, music and visual content and audio-visual programming. The company also provides the services of installing and maintaining the associated equipment. The main customers of Immedia belong to corporate, health and well-being, food retail, fashion, banking, hair and beauty and hospitality industries (www.markets.ft.com).

In this briefing paper, I provide you the basis of investment using the financial analysis method. The paper also briefly reviews the operating and marketing performance of Immedia Group PLC., and the direction of the developmental strategies of the company. Finally, this paper provides an overall conclusion of the analyses with the recommendation as to whether this review could serve as a template for running potential business.

Financial Analysis

Financial analysis is an integral part of the decision making process. Analyzing the financial stability of the electronic manufacturing firms like Monitor PLC is immensely important.  Financial ratio analysis not only helps gauge a firm's performance, it also helps decision making for investors and creditors. Financial performance refers to the methodical evaluation of the financial situation of an organization, person or a project.  Several methods of financial analysis exist; however, ratio analysis is considered the most efficient in determining the financial position and performance of an organization. In attempting to analyze financial statements through the use of financial ratios organizations should have the expertise to interpret them in order to bring about positive changing in the organizational performances. The report provides an in depth analysis and interpretation of the ratios to extract meaningful information for decision-making process from the shareholder's or investor's perspective. In doing so, this report gauges the company's performance against a similar sized competitor, as well as against the business sector normA detailed financial analysis of the Immedia Group Plc is provided here onwards, which encompasses various aspects of financial information. Financial ratio analysis will cover the profitability, efficiency, liquidity and the leverage of the. The financial performance that follows is evaluated and analysed from the perspective of investor. For calculation of these ratios, several formulae have been used and appended at the end of this paper. The formulae fields used have been presented in the table below:

 

2010

2009

Net Income

-48566

75238

Total Assets

1900247

2129314

Shareholders' Equity

624830

705472

Sales

3509421

3771135

Gross Profit

1884325

2048151

Total Current Assets

1376737

1629575

Total Current Liabilities

1275417

1401842

Cost of Goods Sold

1625096

1722984

Inventory

117857

79678

Total Debt / Liabilities

1275417

1423842

Number of Shares

14556844

14556844

Using the above totals of items appearing in the company's balance sheet, income statement and cash flows, ratios have been computed and presented under the following table:

 

2010

2009

Return on Assets

-0.02556

0.035334

Return on Equity

-0.07773

0.106649

Gross Profit Margin

0.536933

0.543113

Current Ratio

1.079441

1.162453

Quick Ratio

0.987034

1.105615

Inventory Turnover

13.78871

21.62434

Total Assets Turnover

1.846824

1.771056

Debt Ratio

0.671185

0.668686

Equity Ratio

0.328815

0.331314

Book Value Per Share

0.042923

0.048463

Earnings Per Share

-0.00334

0.005169

Profitability Ratios

Profitability ratios explain the performance of an organization in terms of the profit it earns. They include return on assets, return on equity, profit margin and gross ...