Published on March 18, 2014
Accounting for Managers Coursework Assignment Dimitrakopoulou Pelagia Kotitsa Eleni Lazaridou Dimitra Papadopoulos Grigorios
ACEA Group: Located in Rome, Italy Founded in 1907 Stock market listed since 1997
ACEA Group operates in: Electricity chain Public lighting Gas Integrated water cycle
Financial Ratio Analysis Ratios were used to measure: •Profitability •Liquidity •Cash Flow Indicators •Activity •Financial Structure
Profitability Ratios 2010-2011 2011-2012 ACEA A2A ACEA A2A Gross Profit Margin 31% 16% 20% 16% Net Profit Margin 3.3% -6% 2.6% -6% Return on Equity 7.4% -8.6% 7.2% -8.9% Return on Assets 8.4% 3.5% 4.4% 3.5%
Liquidity Ratios 2010-2011 2011-2012 ACEA A2A ACEA A2A Current Ratio 1.12 1.22 0.97 1.26 Quick Ratio 1.09 1.11 0.94 1.14
Cash Flow Indicators 2010-2011 2011-2012 ACEA A2A ACEA A2A Operating Cash Flow/Sales 13% 10% 12% 11% Short-term Debt Coverage 21% 25% 17% 27%
Activity Ratios 2010-2011 2011-2012 ACEA A2A ACEA A2A DIO 11 days 18 days 7 days 21 days DSO 171 days 125 days 162 days 115 days DPO -204 days -63 days -175 days -92 days Operating Cycle -22 days 80 days -6 days 44 days Fixed Asset Turnover 1.48 1.28 1.68 1.14
Financial Structure 2010-2011 2011-2012 ACEA A2A ACEA A2A Debt Ratio 75% 63% 80% 68% Debt to Equity 3.61 1.70 4.09 1.48 Capitalization Ratio 69% 53% 58% 59% Debt/EBITDA 5.31 7.30 7.67 7.76 Interest Coverage Ratio 5.03 3.69 2.43 2.81
Threat of new entrants -Capital intensive -High entrance barriers -Established in geographical network and profitability areas Threat of Substitute Products -Many sectors and various production methods -Remarkable numbers of substitutes Bargaining power of buyers -Large number of customers -Necessity of product Bargaining Power of Suppliers - Distributors of energy are more affected -Producers of energy are not manipulated by suppliers Rivalry among existing firms Government regulations and policies affect competition Liberalization in the Italian energy industry since 1969 HIGH LOW LOW LOW to MEDIUM MEDIUM to HIGH Analysis of the Competitive Environment Porter’s Five Forces
SWOT Analysis s•Brand Name •Investment Plans •Domestic leadership in water segment •Use of technologies with a low environmental impact w•Geographically limitation •Increase of electricity prices T•Economic crisis •Government regulations O•Photovoltaic development •Development of energy production from renewable sources
Conclusions ACEA’s position High Profitability Excellent Cash Flow Management Consistency of the firm Key role in the Italian energy market
Conclusions Alerts Demand is affected by weather conditions Gap between demand and supply was expanded after economic crisis Working capital trends need improvement Overdue receivables related to public entities are observed Macro-economic environment is negative (negative Italian Government ratings)
Thank you for your attention
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Comparable Analysis. ... below the market valuation of its peer group. The EV/EBITDA NTM ratio of Acea S.p.A. is lower ... financials: quality data from ...
Financial Statements; Ratios ... Company Peers; Comparable Analysis. ... market valuation of its peer group. The EV/EBITDA NTM ratio of Acea S.p.A. is ...
Scientific Advisory Group Reports; About ACEA. ... Ecological and economic efficiency analysis on ... Transport Policy Scientific Advisory Group Reports ...
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Financial Disclosure. ... An on-line version of the last sets of Acea Group financial statements is ... the most respected European analysis of quality and ...
Group companies; Corporate bodies ... Appointment of Executive Responsible for Acea Spa’s Financial Reporting. ... Analysis and research. seleziona le ...
for the ACEA Group the gross operating profit is an operating performance ... Summary of management and income, equity and financial performance of the ...