The following analysis is a general comparison of the company's performance over the 2013 and 2014 financial years. It numerically explains, using ratios, the company's operational and market performance over the past two periods and could perhaps be helpful and useful to all of the company's interested stakeholders. It must be said that the company's past performance cannot be used to accurately measure its future earnings and growth potential, and that stakeholders must understand the limitations of the analysis itself, which are 1) the use of conventional accounting information and hence the inability to truly compare companies, 2) variations in classification of financial information that makes it extremely hard to compare two different companies, 3) the lack of detailed information as most entities will not tend to publicly reveal its financial position, 4) inappropriate timing of the reports, making them obsolete when they do appear and 5) the lack of benchmarking capability to assess one companies performance against an industry norm. (Anderson. R Financial Management 2013).
Introduction.
GWA Group Limited was first listed on the Australian Stock Exchange in 1993. The Group as of the 30th of June 2014 had 1681 employees, is a member of the ASX 200 and had a market capitalization of over $800 million, and its mission is to be "Australias leading supplier of products and solutions to the residential and commercial building markets" .
During 2014, the company's financial highlights were: revenue of $578 million, up 2% from the previous year, Trading EBIT of $72.3 million, up 8% from the prior period, a fully franked dividend of 5.5 cents and a net profit of $18.6 million which was impacted by one off significant items.1.
Short-Term Solvency Ratios.
The 2014 short-term solvency ratios show the company's ability to pay off its current debts. The current ratio is 2.1, which is slightly down on the previous year of 2.