Unidentified Industries: Australia 2014 Case Solution
Virgin Airlines with Firm A (Airline)
Virgin Australia is the biggest market name of Virgin Australian Airlines industries, it is the domestic Australian airline. It is the biggest in terms of light size to use the name of the virgin brand. It started its services on 31 August 2000 as the virgin blue. It can fly two aircraft on single route, it had become the major airline after the downfall of Ansett Airline. The airline now serves in more than 33 cities in Australia. From Melbourne, Sydney etc.
It is focused on providing high quality luxury experience to the passengers. Staying time in shopping and creating an exciting time for passengers. Developing and environment to meet with the customer’s expectation and finding people who can meet with the airline services and financial objectives.
And virgin airlines’ financial are its best resources to measure its performance and these are its best key performance indicators, which helps them understand strength and weakness and also deep understanding of the financial helps them overall.
And as the Firm A has 44.10% as the Net Property & Equip and also 32% as other long term assets as well, that is why I have selected Virgin Airlines as they as a firm have large assets like property as planes, equipment as operating for airlines and as it has the total equity of 53%, as these fit the Virgin Airlines.
By looking at the ratios of the virgin group the gross margin ratio of the airline is very good which is 56% which is very good that means it’s selling its services more better than the cost which shows this percentage of 56% it’s previous year was 37%. It mainly focuses on continuous engaging new suppliers and increasing their profitability as well. It’s return on investments is also very good that means it get more return on investment and that is very good for a firm. And the current ratio of virgin airlines is 0.54 with comparison of over 1 which firm A has that means Firm A has more assets then Virgin Airlines.
National Australian Bank with Firm B(Commercial Bank)
The National Australian bank is an Australian domestic bank with the functions across Asia, New Zealand, and USA. It provides different services like funds managing, business of retail, banking, Insurance. It is the Largest Australian Company on the Australian securities exchange. With brands including bank- west. ASB bank which is in New Zealand.
As the firm B has 68% as Account Receivable, that is why I have selected the National Bank, as in bank, it gets the money in future from different customers that is why it usually has high numbers as Account Receivable.
National Australian bank financial services include legal authorities to provide detail financial product advice to the customers.
- Deposit information and physical or online payments options.
- Life Insurance including Investment life Insurance
- Exclusive money card
For the last six months the common wealth bank interest on income has decreased by 20% to $12.78b. That is why the net interest income has also decreased 5% to $10b. Net income after extraordinary income has decreased by 16%. After the decrease in net interest income which reflects the decrease of 7%.
And by comparing it with the Firm B it has the net profit margin of 28.92%, ROE of nearly 6% which is very good.
Best Buy with Firm C (Computer and Electronics Retailer)
The best store for online shopping for computer parts and accessories in Australia. It is the best online shopping platform for computers parts and devices in Australia. Which is originally based in the US. Which offers high reliability record player. The company expanded its workings in 1983 in the area of electronics, computes electronic parts. Today it is one of the largest consumer online retail store with the presence all over the world.
Firm C has nearly 72% as Property Plant and Equipment and 14% also in other long term assets. That is why I selected a Computer and Electronics Retailer as it has property, plant equipment. And it also usually has low account payable because their expenses are low as it’s payments are less than other huge firms.
The company has the aim of providing its customers with all the latest gadgets advising them to buy the consumer electronics. And providing them in cost effective and the company also offers customer support for the group of the products from their store.
The company financial performance of every year included undertaking remarkable sales of 2.2% giving them positive figures in sales. As well has also increased by 30%.
The Capital allocation tactics of the company has also been consistent and consistently looking for new growth opportunities including growth opportunities and returning free cash flows for the shareholders. The company has returned $1.5 b to shareholders through dividends and that is a very good sign for the company.
One big negative factor is floating around the best buy company, that is it’s current ratio, which is in negative value. With comparison to the firm c which is quite better in comparison to the best buy which is 1.57
Mayers Holding Department Store with Firm D (Department Store)
The departmental industry has struggled a lot in the recent years due to the unaware retail environment, and lower consumer response over the past few years. Consumer are now focusing on the lower price products and increase the savings.
As firms D has 9% in cash because it needs significant amount of money for daily operations. And as it invests in other long term assets like in bonds and stocks as well. The firm D also has 9.30% because it has to pay to its suppliers and pay their bills as well.
First of all by looking at its financial which shows its long term assets percentage is 73% which is very good, because a business which has more assets is going to be performing well in the market. It has the assets of property plant and equipment of 18% and in receivable and inventory whose percentage is also very good, and by looking it equity and liability it’s equity and liability is also very good. It days in receivables is normally 6 days and days in payable are 66 days normally, and therefore this company is performing well.
And by comparing it with the firm d, it is performing better because its current ratio is 0.78 better than the firm 0.26……………..
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