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Cola Corporation (Consolidated Results) for the last 3 years. A brief rationale for the ratios selected
is also given. Lastly, the ratios are compared against its major competitor, Pepsiamericas, Inc.
1. Working Capital = Total Current Assets – Total Current Liabilities 510 Mln 11 Mln n/a
2. Current Ratio = Total Current Assets / Total Current Liabilities 1.06:1 1.0015:1 n/a
3. Quick Ratio = Current Assets less Inventories/ Current Liabilities 0.90:1 0.71:1 n/a
Leverage Ratios:
4. Total Debt to Total Assets = Total Liabilities/ Total Assets 0.48:1 0.51:1 n/a
*Total debt which was just over 50% of total assets in 2002, has decreased
Slightly to 48% of total assets in 2003. An improvement.
*Interest coverage ratio has improved steadily over the period, from
18 to 27 to 29 times the operating income.
Efficiency Ratios:
6. Average Collection Period = (Trade A/cs Rec/ Net Op Rev.) x 360 35 days 38 days n/a
Shows the average time taken to collect cash against credit sales.
Indicator of collection efficiency of the business.
8. Total Asset Turnover = Net Op Rev/ Total Assets 0.77 0.80 n/a
times times
Measures the efficiency of the firm in using its assets to generate sales.
* The asset turnover has dropped slightly, from 0.80 to 0.77 times.
9. Gross Profit Margin = (Gross Profit/ Net Op Rev) x 100 63.11% 63.68% 65.55%
10. Net Profit Margin = [Net Inc.(after Acc.Change)/ Net Op. Rev.] x 100 20.65% 15.59%
22.62%
Indicates net profitability of the business; figures selected after accounting change.
11. Return on Total Assets = (Net Income / Total Assets) x 100 15.89% 12.49% n/a
* ROA has increased from 12.49 to 15.89% over the year, showing
Greater productivity in using the firm’s assets.
Equity Ratios:
12. Book Value per Share = Total Stockholders Equity/ Total Ord. Shs. $5.76 $4.77 n/a
* Book value has increased from $4.77 to $5.76 over the period.