The strategy of Zotefoams refer to the expansion through new customers for MuCell extrusion technology licensing business, partnerships or acquisitions in related technologies, products or markets and a combination of profitable organic growth of Polyolefin and HPP foams businesses. There are four key objectives of Zotefoams that explain the strategy’s core elements. • Grow – Grow sales in their polyolefin business. Sales growth in polyolefin foams grew by 8 percent in constant currency and exceeded twice the average rate of GDP growth. Company want to increase sales in excess of twice GDP growth through support customers in new application and product innovation. • Develop – Develop a HPP portfolio and MEL customer base to deliver increased margins. HPP sales increased by 51 percent to 3.60 million. Company see potential to increase margins and high profit in HPP portfolio so they tend to further invest in markets, products and technology from these high growth opportunities. • Improve – Improve their return on capital employed. Pre-tax return on capital employed (ROCE) rose to 20.8 percent in 2012. ROCE is a suitable benchmark for them because a result of lower of ROCE might occur in each year and the longer term shareholders expect a return over their risk. • Profit – Increase their operating margins. Group operating margins grew to 12.8 percent of sales. The polyolefin foams margins and HPP business were increased whereas the increased investment of MEL was loss. Therefore, they want to achieve in operating margins. However, they plan to keep on the same four key objectives of business, although the high levels of capital expenditure planned will impact the return on capital employed. Moreover, they extend the site of Croyd... ... middle of paper ... ...igh liabilities from the increasing of interest-bearing loans and borrowings in 2012. It might difficult to control and conduct this debt” Question 3: What are the company’s plan to cope with these liabilities and why company decided to use this plan? “From Five year summary, the revenue, profit before tax and dividends increased continuously from 2009 to 2012. The company could make the market to see the potential of the company in the future” Question 4: Do you have any plan to keep this improvement of performances in the future? “Company plan to keep on the same four key objectives of business (Growth, Develop, Improve and Profit), although the high levels of capital expenditure planned will impact the return on capital employed. Question 5: Why the company decided to keep on this four key objectives, although it will impact the return on capital employed?
Shareholders are more concerned with the company’s financial stability, productivity and cash flow projections versus other internal financial facets of Henley Manufacturing. Hence, it would be within reason to make recommendations based upon the information presented. Goals to be recommend incudes annual sales growth which is expected to increase by 15% in the next year, and the earning potential which is expected to grow by 20%. Additionally, shareholders would also be interested in the return on net tangible assets which is anticipated to increase by 16% and the return on common equity which is projected to increase by 20%. Furthermore, importantly, shareholders are also very interested in the company minimum profit margin which is expected to be 5% (Revsine, Collins, Johnson, Mittelstaedt, & Soffer, 2015). The profit margin informs shareholders how much proceeds earned from sales exceeds costs incurred in the
This company has been performing well for many years and this this because of their good business model. Everything that was noticed on the income statement was the good performance of company. Their dividends have increased over time; this was due to increased profits. The earnings growth projections for the next four years have increased five percent.
Capital allocation. Every dollar you raise and spend should produce more than $1 of return for the company, or it’s a waste of money. Learn how to make these judgements.
After going through the appendix 1 briefly it shows that Australian Hardware’s business has been successful from years and having growth in business every year. According to the appendix business is underperforming from last 3 months which makes the owner of the company to assess the problems. Cause of this underperformance company owners wants to identify the areas need to be improved so that the
Shareholder will benefit from the incremental value produce by the development of new products, and the growth of the company
Obviously, this case aims to evaluate Joanna’s analysis. Throughout the analysis, we will estimate the cost of debt, cost of equity, and cost of capital through different financial analysis models.
the lack of growth experienced by Gillette was primarily caused by the increase in price,
On the Ansoff matrix below is shown what growth strategies for new and existing products and markets can be used from the company.
During the last few years, Harry Davis Industries has been too constrained by the high cost of capital to make many capital investments. Recently, though, capital costs have been declining, and the company has decided to look seriously at a major expansion program that had been proposed by the marketing department. Assume that you are an assistant to Leigh Jones, the financial vice president. Your first task is to estimate Harry Davis’s cost of capital. Jones has provided you with the following data, which she believes may be relevant to your task.
Nevertheless, it must “defend” its current market share if not increase it, by maintaining premium quality and develop innovative products. The marketing mix strategies will effectively achieve targeted revenue and profitability in the near future.
You have asked me to analyze your plans for future growth and recommend the best form of business organization to accommodate that growth. I have also taken into consideration you’re your two main concerns of increased liability and ability to add investment in capital assets.
The tool helps marketers to examine threats in the development of new product and expansion into new markets. One of its major advantage is that it helps organisation minimize risks and exposing them future opportunities. The Y axis of the quadrant which can be seen be...
of these ideas rather than their focus on the return on investment, which is the ideal scenario for the
Question 1: Critically analyze the growth strategy adopted by the Aditya Birla Group. What are your views on the business portfolio adopted by the group? (7 marks)
I would recommend the continual implementation of the current strategy. The strategy is working and there is no reason to deviate from it. The company has been very successful in expanding its operations in other countries. I would recommend that the company continue to do that. I would also recommend spending extra resources in the development of new products to keep a competitive advantage over other competitions. The competition is only going to rise because the market has not reached saturation yet. In order to stay ahead of the competition, the company needs to keep researching new products, and stay in sync with the ever changing technology.