PANASONIC

CORPORATION
PREPARED BY: ANADON, YVES MICHAEL
MADRONIO, KRISANDO M.
PLACIDO, CARL JOHN C.
RATIO ANALYSIS

 LIQUIDITY RATIOS- used tom measure the firm’s ability to pay its short-
term debts as they fall due.
 ACTIVITY RATIOS- used to measure the ease or speed of converting
various accounts into cash or sales.


 DEBT RATIOS- used to measure the degree of indebtedness of the

firm and its ability to service its debts.
 PROFITABILITY RATIOS- used to show the combined effects of
liquidity, asset management, and debt management on operating
results. The firm’s earnings is evaluated in relation to assets, sales,
owner’s investment or share value
LIQUIDITY RATIOS

CURRENT RATIO 3,204,819 This means that the company has $1.18 of current
= 1.18 𝑜𝑟 118% assets for every $1 of current liabilities
2,712,063

A normal liquid ratio is considered to be 1:1. Since

3,204,819 − 806,309
QUICK OR ACID TEST RATIO = 0.88 𝑜𝑟 88% the company has quick ratio of less than 1, it
2,712,063 cannot currently fully pay back its current liabilities.

Since the company has a cash ratio of less than 1,

1,270,787
CASH RATIO = 0.47 𝑜𝑟 47% these means that the company needs more than
2,712,063 just its cash reserves to pay off its current debt.
ACTIVITY RATIOS

5,157,163 The company has a good inventory turnover,

INVENTORY TURNOVER = 6.54𝑋 because its average inventory is turned or sold
769,650 + 806,309
2 for almost 7 times during a period.

847,003 The ratio indicates that it takes just 41 days for

AVERAGE COLLECTION PERIOD = 41.52 𝑑𝑎𝑦𝑠 the company to collect an account
7,343,707
360 receivable.

955,965 This ratio indicates that it takes 95 days for the

AVERAGE PAYMENT PERIOD = 95.33 𝑑𝑎𝑦𝑠
5,157,163 𝑥 70% company to pay an account payable.
360

7,343,707 A ratio 1.23 means that each dollar of assets

TOTAL ASSET TURNOVER = 1.23 𝑜𝑟 123%
5,982,961 generates 1.23 dollars of sales.

7,343,707 A ratio of 2.64 means that each dollar of fixed

FIXED ASSET TURNOVER = 2.64 𝑜𝑟 264%
2,778,142 asset generates 2.64 dollars of sales.
DEBT RATIOS

A lower debt ratio usually implies a more stable

4,332,026 business with the potential of longevity because a
DEBT RATIO = 0.72 𝑜𝑟 72%
5,982,961 company with lower ratio also has lower overall
debt.

A debt to equity ratio of 1 would mean that

1,510,963 investors and creditors have an equal stake in the
DEBT-TO-EQUITY RATIO = 0.86 𝑜𝑟 86%
1,759,935 business assets. A lower debt to equity ratio usually
implies a more stable business.

The higher the times interest earned ratio, the more

276,784
TIMES INTEREST EARNED RATIO (TIE) = 11.75𝑋 likely is that the company will be able to meet its
23,550 interest payments.
PROFITABILITY RATIOS

172,442 This means that a company has $0.02 of net income

NET PROFIT MARGIN = 0.02 𝑜𝑟 2%
7,343,707 for every dollar of sales.

For every dollar generated in sales, the company has

2,186,544
GROSS PROFIT MARGIN = 0.30 𝑜𝑟 30% $0.30 left over to cover basic operating costs and
7,343,707 profit.

276,784 In conclusion, the company makes $0.04 before

OPERATING PROFIT MARGIN = 0.04 𝑜𝑟 4%
7,343,707 interest and taxes for every dollar of sales.

172,442 For every dollar of assets the company invests in, it

RETURN ON ASSET = 0.03 𝑜𝑟 3%
5,982,961 returns $0.03 in net profit (after all deductions).

This means that every dollar of common shareholder’s

172,442 equity earned about $0.10 this year. In other words,
RETURN ON EQUITY = 0.10 𝑜𝑟 10%
1,759,935 shareholders saw a 10 percent return on their
investment.
COMPARATIVE INCOME STATEMENT
WITH VERTICAL ANALYSIS
&
COMPARATIVE BALANCE SHEET
WITH HORIZONTAL ANALYSIS
 COMPARATIVE INCOME STATEMENT
FOR THE YEAR ENDED MARCH 2017 AND 2016
2017 2016
Amount Percent(%) Amount Percent(%)

Net Sales 7,343,707 100% 7626306 100%

Cost of Sales -5,157,163 70% -5,367,667 70%
Gross Profit 2,186,544 30% 2,258,639 30%

Selling, general and Admin Expenses -1,842,928 25% -1,845,393 24%

Share of Profit of investment accounted for using the equity method 8378 0% 8,445 0%
Other Income(expenses) net -75,210 1% -191,392 3%
Operating Profit 276,784 4% 230,299 3%
Finance Income 21,832 0% 23,618 0%
Finance Expenses -23,550 0% -26,388 0%
Profit before income taxes 275,066 4% 227,529 3%
Income Taxes -102,624 1% -36,296 0%
Net Profit 172,442 2% 191,233 3%
*7,343,707/7,343,707 x 100 = 100%
 2017 2016 Increase or (Decrease)
Amount Percent(%)
COMPARATIVE As s ets
Current a s s ets :

BALANCE SHEET Ca s h a nd ca s h equiva lents 1,270,787 1,012,666 258,121 25%

847,003 835,456 11,547 1%
MARCH 31, 2017
Tra de receiva bles
Other fina ncia l a s s ets 143,519 165,496 -21,977 -13%

AND 2016
Inve ntories 806,309 769,650 36,659 5%
Other current a s s ets 137,201 110,494 26,707 24%
Tota l Current a s s ets 3,204,819 2,893,762 311,057 11%

Non-current a s s ets :
Inve s tment a ccounted for us ing the equity method 155,987 160,667 -4,680 -3%
Other fina ncia l a s s ets 161,986 149,422 12,564 8%
PPE 1,323,282 1,288,234 35,048 3%
Goodwill a nd inta ngible a s s ets 665,132 474,149 190,983 40%
Deffered ta x a s s ets 407,720 454,204 -46,484 -10%
Other non-current a s s ets 64,035 67,586 -3,551 -5%
Tota l Non-current a s s ets 2,778,142 2,594,262 183,880 7%

Tota l a s s ets 5,982,961 5,488,024 494,937 9%

Lia bilities a nd Equity

Current lia bilities :
Short-term debt 117,038 21,728 95,310 439%
Tra de pa ya bles 955,965 894,927 61,038 7%
Other fina ncia l la ibilities 329,625 276,810 52,815 19%
Income ta x pa ya ble 66,785 70,779 -3,994 -6%
Provis ions 317,261 386,260 -68,999 -18%
Other current lia bilities 865,389 832,836 32,553 4%
Tota l current lia bilities 2,712,063 2,483,340 228,723 9%

Non-current lia bilities

Long-term debt 946,966 703,113 243,853 35%
Re tirement benefit lia bilities 467,749 580,712 -112,963 -19%
Provis ions 17,679 12,958 4,721 36%
Deferred ta x lia bilities 62,531 44,502 18,029 41%
Other non-current lia bilities 16,038 16,166 -128 -1%
Tota l non-current lia bilities 1,510,963 1,357,451 153,512 11%

Tota l lia bilities 4,223,026 3,840,791 382,235 10%

THANK YOU!