Finance analysis of Vinamilk from 2012 to 2014 1. Liquidity ratio analysis of Vinamilk from 2012 to 2014 2. Financial structure ratioes ananlysis of Vinamilk between 2012 to 2014 3. The operational effectiveness ratio analysis of Vinamilk from 2012 to 2014 4. The profitability ratio analysis of Vinamilk between 2012 to 2014 5. The conclusion about the financial situation of Vinamilk from 2012 to 2014
Finance analysis of Vinamilk from 2012 to 2014 ( Form the annual reporting of Vinamilk from 2012 to 2014 : https://www.vinamilk.com.vn/vi/bao-cao-thuong-nien ) Business activities of Vinamilk in 2012 to 2014 had certain positive effects when the economic situation is having a lot of difficulties Liquidity ratioes analysis of Vinamilk from 2012 to 2014 • The table of general ratio analysis ( unit : billions of VND) Quota 2012 2013 2014 Total assets 19.698 22.875 25.770 Current and 4.205 5.037 5.970 long-term liabilities General 4,7 4,3 4,3 liquidity ratio • The graph of general liquidity ratio of Vinamilk From the table and graph, we can see that the general liquidity ratioes were on the decrease from 2012 to 2014 In particular, the ratio declined by 0,4% overall from 4,7 in 2012 to 4,3 in 2013, 2014 Althought total assests has increased over years from 19.689 billion in 2012 to 22.875 billion in 2013 and 25.770 billion in 2014, but at a rate lower than the growth rate of short-term debts The general liquidity ratioes of Vinamilk decreased but generally this indicator remains relatively high levels It indicates that the enterprise has sufficient liquidity • The table of short-term liquidity ratio analysis : (unit : billions of VND) Quota 2012 2013 2014 Short-term 11.111 13.019 15.522 assets Current 4.145 4.956 5.453 liabilities Short- term 2,7 2,6 2,8 liquidity ratio • The graph of short-term liquidity ratio of Vinamilk The table analysis and gragh shows the short-term liquidity ratioes over the years are uneven From 2012 to 2013, the short-term liquidity ratio decreased by 0,1% from 2,7 in 2012 to 2,6 in 2013 This creates a disadvantage for the company, current assets increased from 11.111 billion in 2012 to 13.019 billion in 2013 Short-term asset values are great due to much inventory ratioes and current debts increase By 2014, short-term liquidity ratioes were much improved and it increased 0,2% from 2,6 in 2013 to 2,8 in 2014, because short-term liabilities increased more slowly than in 2013 This shows that Vinamilk has a high financial ability and it can make sure and respond short-term debts • The table of quick liquidity ratio analysis ( unit : billions of VND) Quota 2012 2013 2014 Current 11.111- 3.472 13.019-3.217 15.522-3.620 assets – =7.639 =9.802 =11.902 inventory asstes Short-term 4.145 4.956 5.453 liabilities Quick 1,8 2,0 2,2 liquidity ratio • The graph of quick liquidity ratio of Vinamilk From the analysis of table and chart, wecan see that the quick liquidity ratio of the company has steadily increased over the years This ratio increased to 0,2% 1,8 in 2012 to 2,0 in 2013 and from 2013 to 2,2 in 2014 This shows that the company has the ability to pay short-term liabilites at a high level when it don’t need sell inventory assets • The table of liquidity ratioes of Vinamilk from 2012 to 2014 Quota General liquidity ratio Short-term liquidity ratio Quick liquidity ratio 2012 4,7 2,7 2013 4,3 2,6 2014 4,3 2,8 1,8 2,0 2,2 • The graph of liquidity ratioes of Vinamilk from 2012 to 2014 The liquidity ability of Vinamilk was always guaranteed at high level This shows the financial capacity of the company and this creates a large advantage in mobilizing capital for business activities, as well as increased credibility with suppliers Financial structure ratioes ananlysis of Vinamilk between 2012 to 2014 • The table of debts / total assets ratio analysis : Quota 2012 2013 2014 Total debts 4.205 5.307 5.970 Total assets 19.698 22.875 25.770 Debts/ total 21% 23% 23% assets ratio Throught the analysis, we can see that in 2012, total assets of the company with 21% financed by debts In 2013, 2014, this ratio had risen at 23%, it means that total assets of the company had 23% from borrowing The increase of this ratio in 2013,2014 was not too high, it shows that the enterprise has gradually known to exploit the financial leverlage, i.e, how to raise capital by borrowers • The table of debts/ total owners’equity ratio analysis : Quota 2012 2013 2014 Total debts 4.205 Owners’equity 15.493 Debts/owners’equity 27% 5.037 17.545 30% 5.970 19.680 30% The debts/ owners’equity increased by 3% from 2012 to 2014 This shows the company depended on owners’ equity more than forms of debt, but the ratio is not too high, Vinamilk has known exploit benefits of debt and tax saving to business `3 The operational effectiveness ratio analysis of Vinamilk from 2012 to 2014 • The table of the operational effectiveness ratio of Vinamilk Quota 2012 2013 2014 Inventory 5,2 5,9 6,6 turnover Receiveable 12,0 12,4 11,3 turnover Working capital 2,6 2,6 2,5 turnover Asset turnover 1,5 1,5 1,4 ratio - From the analysis of the table, we can see that the inventory turnover steadily increased over the years, particularly it increased by 0,7% from 5,2 in 2012 to 5,9 in 2013 and from 2013 to 2014, it also increased by 0,7% The increase of the ratio shows fast sales of the company and inventories was not much It means the company is less risk than when inventory items in the financial statement decrease over the years, from 3.472 billion in 2012 to 3.217 billion in 2013 By 2014, inventories increased at 3.620 billion but the growth rate was smaller than the growth rate of revenue, so the inventory turnover still increased - The receiveable turnover fluctuated over the years From 2012 to 2013, the receiveable turnover increased by 0,4% from 12,0 to 12,4 At the moment, the ratio increase demonstrates that the speed of rapid debt collection of Vinamilk and the high ability to convert debts into cash This helps the company improves cash flow and creates the initiative in the funding of working capital financing in production By 2014, the ratio declined by 1,1 % to 11,3 The decline was not too big but it shows that the amount of money of the company was appropriated and it reduced the initiative in the funding of working capital financing in production If the figure is falling, the company may have to borrow banks to finance the working capital - Working capital turnover in 2012 and 2013 remained at 2,6 It shows that the company steadily maintained production activities, business By 2014, working capital decreased at 2,5 It shows that the rotation speed reduction of working capital and the company used inefficient working capital - In 2012 and 2013, the asset turnover does not change at 1,5 It means that with each a property , the company created 1,5 revenue By 2014, the ratio reduced to 1,4 shows the production and business efficiency was down, but not too much The profitability ratio analysis of Vinamilk between 2012 to 2014 • The table of profitability ratioes of Vinamilk from 2012 to 2014 Quota 2012 2013 2014 ROA 33,0% 30,7% 24,9% ROE 41,6% 39,6% 32,6% • The chart of profitability ratioes of Vinamilk from 2012 to 2014 Thourgh the table and chart of profitability ratioes analysis, we can see that ROA, ROE was reducing gradually over the years Specifically : ROA decreased from 33,0% in 2012 to 30,7% and 24,9% in 2013, 2014 respectively Besides, ROE also reduced from 41,6% in 2014 to 39,6 in 2013 and 32,6% in 2014 The declining of ROA, ROE is due to the impact of the rise in total assets and owners’ equity ( mainly in the from of additional issuance of stock to the market) of Vinamilk in recent years We compare with the average industry of ROA, ROE (http://ivt.ssi.com.vn/CorporateSnapshot.aspx?Ticket=VNM ) are 27,23% and 20,47% respectively We can see that ROE in over the years were greater than the average ratio so much This created a great revenue for Vinamilk when it used the effective equity Besides, ROA of the years was much higher than the average industry , the figures shows a great profit of Vinamilk The conclusion about the financial situation of Vinamilk from 2012 to 2014 • The financial situation of Vinamilk between 2012 to 2014 was quite stable and the company had a strong financial potential - Vinamilk know how to exploit financial leverage by the higher debt ratio increase over the years That increased the business efficiency The company should use the tools of interest to reduce tax burdens - All of liquidity ratioes were at high and >1, so the company can be assured about its liquidity and it has a lot of creadibility with suppliers - With financial activities, Vinamilk know how to control better inventories over the years by cost reductions, reducing damage to the goods Cash flow to fund working capital reduced and it was more occupied by receiveable turnover was uneven and in 2014, it decreased Working capital turnover and asset turnover ratio decreased, so the company need use working capital and assets more effectively - Profits of Vinamilk decreased form 2012 to 2014 but the profitability ratioes remained much higher than the average industry This reflects the company has good financial management policies, but Vinamilk need to adjust the increase of assets and equity logically [...]... revenue for Vinamilk when it used the effective equity Besides, ROA of the years was much higher than the average industry , the figures shows a great profit of Vinamilk 5 The conclusion about the financial situation of Vinamilk from 2012 to 2014 • The financial situation of Vinamilk between 2012 to 2014 was quite stable and the company had a strong financial potential - Vinamilk know how to exploit... uneven and in 2014, it decreased Working capital turnover and asset turnover ratio decreased, so the company need use working capital and assets more effectively - Profits of Vinamilk decreased form 2012 to 2014 but the profitability ratioes remained much higher than the average industry This reflects the company has good financial management policies, but Vinamilk need to adjust the increase of assets... efficiency The company should use the tools of interest to reduce tax burdens - All of liquidity ratioes were at high and >1, so the company can be assured about its liquidity and it has a lot of creadibility with suppliers - With financial activities, Vinamilk know how to control better inventories over the years by cost reductions, reducing damage to the goods Cash flow to fund working capital reduced