Tamalanplc is a retail chain with 160 stores and 14,000 employees.

Question # 00004138 Posted By: neil2103 Updated on: 11/25/2013 11:30 PM Due on: 11/29/2013
Subject Finance Topic Finance Tutorials:
Question
Dot Image

7.2 Tamalanplc is a retail chain with 160 stores and 14,000 employees. Its financial statements for 2008 are shown below:

Income Statement

2008

2007

£m

£m

Turnover

1,021.5

847.4

Cost of sales

-855.3

-710.4

Gross profit

166.2

137.0

Administrative expenses

-47.9

-29.1

Operating profit

118.3

107.9

Net interest payable

-0.9

-0.3

Profit on ordinary activities

before taxation

117.4

107.6

Taxation

-30.7

-33.5

Profit on ordinary activities

after taxation

86.7

74.1

Dividends

-33.3

-29.3

Profit retained for the period

53.4

44.8

Additional information:

Earnings per share

21.3p

18.4p

There are 440 million shares issued of 10p each

Market value of shares

£1.50

£1.40

Balance Sheet

2008

2007

£m

£m

Fixed assets

Intangible assets - goodwill

37.3

32.3

Tangible assets

167.6

132.3

Investments

22.5

25.7

227.4

190.3

Current assets

Inventory

135.0

105.3

Trade Receivables

22.5

20.8

Cash at bank

16.2

17.8

173.7

143.9

Total assets

401.1

334.2

Non-current liabilities

Long term loans

14.8

13.4

Provision for deferred taxation

9.5

7.6

24.3

21.0

Current liabilities

Trade payables

159.8

149.6

Total liabilities

184.1

170.6

Net assets

217.0

163.6

Equity

Share capital

44.0

44.0

Profit and loss account

173.0

119.6

Shareholders' funds

217.0

163.6

Calculate sufficient ratios for both 2008 and 2007 to demonstrate the changes in profitability, liquidity, efficiency, gearing and shareholder return of Tamalanplc and comment on the most important changes between 2008 and 2007.

7.2

This problem requires you to calculate specific ratios for two years. You will need to research the type of ratios that make up the classifications in the question (profitability, liquidity, efficiency, gearing and shareholder return). Your answer should be structured by showing the name of the ratio in one column (ROCE for example) then a column for 2008 and a column for 2007 and both of these columns will contain the percentages or ratios. REMEMBER – you must show the calculation and you should show 16 ratios. NOTE: do not forget to "comment on the most important changes between 2008 and 2007" Problem 7.2 Tamalan plc - you will determine 16 ratios (if you don't have 16 then you left something out) that demonstrates changes in profitability, liquidity, efficiency, gearing and shareholder return. Research the text because these ratios are defined. For example:

Gross profit/Sales xx.x/xx.x = xx.x% xx.x/xx.x = xx.x% Note - for each year use a column format for both years.

Dot Image
Tutorials for this Question
  1. Tutorial # 00003914 Posted By: neil2103 Posted on: 11/25/2013 11:32 PM
    Puchased By: 2
    Tutorial Preview
    The solution of Tamalan Plc solution...
    Attachments
    Tamalan_PLC.docx (22.1 KB)

Great! We have found the solution of this question!

Whatsapp Lisa