Procter and Gamble (P&G) and Colgate-Palmolive (C-P) are two of the largest consumer goods company in the world and have been in the industry since the 80s. The companies manufacture and market fast moving consumer goods (FMCG) such as household products, personal care and hygiene, targeting at various segments of consumers. Among the brands carried by P&G are Downy, Olay, Tide, Clairol and Bounty. Popular brands under C-P are Palmolive, Kleenex, and Colgate. In terms of financial performance both companies have performed well. This brief review will focus on the financial performance such as profitability, solvency and liquidity. Firstly, based on the profitability, P&G has earned higher profit from each dollar of revenue which is 13.4% compared to C-P 12.9% for the recent year 2013. In addition, P&G also has higher EPS of US$4.04 compare to C-P US$2.41. In contrast, C-P register a Gross Profit of 58.7% and Return on Equity of 91.0% as opposed to P&G’s 49.6% and 17.0% respectively. C-P seems to rely heavily on debt and this has helped to improve the Return of Equity. P&G also has its downside in asset turnover ratio (0.62) and fixed turnover …show more content…
Its receivable turnover is 13.4 times per year, which is higher than C-P 10.5. In addition, the average number of days from sale on account to collection for P&G is 27.2 days while for C-P is 34.8 days. Based on the efficiency ratio analysis, P&G’s inventory moves quickly from purchase to sale, which the inventory turnover ratio is 6.2 and the time for the purchased inventories to be on sale is on the average of 58.6 days while C-P’s turnover ratio is 5.2 and the average days to sell is 70.6. This shows that P&G takes a shorter time than C-P to sell their inventories. However, C-P has a higher ability to pay their short-term liabilities, whereby the current ratio is 1.08 as opposed to P&G
...s are doing well and over the many years have gone up. The company has not lawsuits currently pending which is good. The company as a whole seems to be growing even when the market is down.
We compared the two companies in a variety of ways. To start, we will give a brief background
Using the 5 different ratio analysis used earlier to analyse BMO life insurance company’s Q2-2015 Consolidated Income statement and Q2-2015 Consolidated Balance sheet. BMO’s profit margin is 9.79%1. Meaning BMO earns more net income per $1 of sales than some or even most of its competitors. This can be rated as favorable in comparison to its industry average of 9.58%. BMO’s days’ sales uncollected is 21.84days2 favorable when compared to its industry’s average of 98.59 days. This means that BMO can liquidate it receivables in lesser days than some or most of its competitors. BMO’s equity ratio shows that the owners of the company only owns 10.66%3 of the company’s assets. Compared to its industry
Particulars The Hershey Tootsie Rolls Net sales (A) $ 5,671,009 $ 528,369 Beginning receivable $ 390,061 $ 41,895 Ending receivable $ 410,390 $ 37,394 Average receivable (B) $ 400,226 $ 39,645 Account receivable turnover C = (A/B) 14.17 13.33 Average collection period 365/C 25.76 27.39 As can be seen from the above, the table shows that both The Hershey and Tootsie Rolls companies have very low receivable periods due to the nature of the industry and also reflects the efficient cash management and receivable management on the part of both the companies.
Another highlight of the company was the company’s gross margin, which was 32.8 in 2012, just a little more than the 31.9 in 2011 and their selling rate went down by 20.9
After conducting a basic 10 year financial analysis of the company, it has become evident that even with a highly competitive market structure they are able to improve on their performance. Ranging from 2004 to 2013 financial information, the company has shown a significant increase in their sales revenue roughly $3865 million sales in 2004 to almost four time that valuing $12970 million in 2013, which was an “increase of 10.4% over the 53 week prior year” The company’s growth strategy has been to diversify its product market and make them...
P&G was founded in 1837 by William Procter and James Gamble as a maker of soaps and candles. P&G was known in Corporate America as a company to be admired and imitated. In addition, it was envied for its profitability as well as strong brand name. P&G has a long standing reputation as having life long employees. This dedication and loyalty by P&G's employees created the notion that outside sources were unwelcome and all products and ideas must come from within, however, this is not the way of the future.
Liquidity measures a company's capacity to pay its debts as they come due. However, Wal-Mart’s current ratio is 0.93, Target current ratio is 1.11 and the industry ratio is 3.04, which is much higher, so I would say that it is good but needs improvement. The quick ratio for Wal-Mart is 1.04 and Target’s quick ratio is 0.21 and the industry ratio is 0.31, which is much higher. Wal-Mart’s is higher and needs some improvement and Target’s is good. Accounts receivable for Wal-Mart is 9 days and Target’s is 6 days, whereas an estimate for the industry is 17 days, which means that both of them are doing better than the industry standards. Target’s inventory ratio is 6.04 and Wal-Mart’s inventory ratio is 0.81, and the industry ratio 1.58. These numbers shows that Wal-Mart is good but Target needs improvement. Furthermore, based on this analysis, I would say that Wal-Mart and Target are doing well but both have areas that need improvement.
The objective of this report is to give an overall view on research and analysis to regards of two companies, Wm Morrison Supermarkets Plc and Tesco Plc that I have chosen for. In this report, I will be comparing two companies’ financial analysis based on their comprehensive income and balance sheet for one year; and also will be comparing their generating cash ability, cash management and financial adaptability based on statement of cash flows for the past two year and also determine whether the two companies have the ability to repay their debts to their creditors, generating into cash and going concern which related to finance.
Addressing Price Earnings Ratio, the considerations for both companies seems to be at opposites. From 2008 through 2012 GOOG had increased their P/E ratio by 25% which is an indicator of what the market believes each dollar is worth of annual earnings, but cautiously could be overvalued until validated by increased earnings. As with YHOO, it has deflated to a -59%.
In the $1 billion Indian Oral Care Industry, Procter & Gamble faces three main opponents: Colgate Palmolive India, Hindustan Unilever Limited and Dabur India. Colgate Palmolive India had its start in 1937 as an oral care product. SInce then, it has enjoyed 78 years as the leading oral care provider. Currently, it has 41.4% of the toothbrush market, making it the leading brand. Its toothbrushes are marketed towards any and all toothbrush users with a special emphasis towards expanding into rural markets.
Once America’s most innovative consumer products company, Procter and Gamble (P&G) started by selling soaps and candles in a small Cincinnati storefront in 1837 (Procter and Gamble, 2008). After a hundred and seventy-one years P&G has grown to over one hundred household brands in over eighty countries (Markels 2006). Their products range from air fresheners to prescription drugs. However, as P&G headed into the twenty-first century they announced that they would not be meeting their 1st quarter earnings forecast [Lafley, 2003]. Revenue margins were dropping and P&G was quickly losing market share to Kimberly Clark and Johnson & Johnson. After missed earnings P&G’s stock price fell from $59.18 to $26.50 between January 2000 and March 2000 (PG). Upset, the board of directors pressured then CEO Durk Jager to resign after a lack luster attempt at turning P&G around and replaced him A.G Lafley, an unproven CEO, whom analysts felt lacked the experience to give P&G a much needed clean up (Lafley, 2003).
Johnson & Johnson researches, develops, manufactures, and sells products in health care. The company was founded by three brothers, Robert Wood Johnson, James Wood Johnson, and Edward Mead Johnson, in New Brunswick, New Jersey, in 1886 (J&J website). Alex Gorsky is currently the chairman and chief executive officer of the company. Johnson & Johnson is known for providing a competitive pricing strategy. In the United States, Johnson and Johnson strives to keep their net price increases for health care products within the Consumer Price Index. The company supports more than 600 programs that address major health-related issues in local communities in more than 50 countries, making it the world’s largest corporate donors (J&J website).
P&G’s purpose is to provide branded products and services of superior quality and value that improve the lives of the world’s consumers. P&G values their employees through leadership, ownership, integrity, passion for winning, and trust. P&G entices and recruits best people in the world, builds their organization by promoting and rewarding from within, and believes that their employees will always be the most important asset. P&G has many principles such as (1) showing respect to all individuals, (2) valuing differences, (3) inspiring and enabling employees to achieve high expectations, standards, and challenging goals, (4) valuing personal mastery, (5) believing that all individuals can and want to contribute to their fullest potential, (6)
A benchmarking analysis against competitors is provided in excel. These data indicate that Primo was performing poorly against its three competitors in terms of day’s receivable and day’s inventory. The fact that day’s payable was 40 days versus 30 days for the credit terms offered by its suppliers, and much higher than for its competitors, helps explain much of the reason for complaints from the company’s suppliers about late payments. In the future, Primo might have limited access to supplier credit, and suppliers might ultimately refuse to sell to the company unless payment is made up front in cash. The data also indicate that the company was performing poorly against its competitors in every profitability metric displayed.