Financial Analysis of Mitsui & CO Essay Example | Topics and Well Written Essays - 750 words

Financial Analysis of Mitsui & CO - Essay Example The company seems to be well managed. The profitability assessments are mostly positive, the liquidity position of the company is also steady and the operational efficiency is also relatively good. But the capital structure shows weaknesses. The company needs to reduce its leverage for it to be viable in the longrun. The ratings provided by the above organizations show that the company is well trusted in the market and shows strength. Appendix 1. Return on Investment (ROI) = {Profit before interest and tax (PBIT) / Investment (total assets - current liabilities)} 2007: (2798 / 50,874) x 100; 2006: (2164 / 43270) x 100 2. Gross Profit Ratio = (Gross Profit) / Revenue 2007: (2798 / 41,363) x 100; 2006: (2164 / 29741) x 100 3. Return on Equity (ROE) = {Profit after interest and tax / Equity }x 100 2007: (1347 / 17,884) x 100; 2006: (1066 / 14,341) x 100 4. Earnings per share (given as income per share) 5. Working Capital = Current assets - Current liabilities 2007: (42,998 - 32,290) ; 2006: (40,571 - 30,008) 6. Current Ratio = Current assets : Current liabilities 2007: ((42,998 / 32,290) ; 2006: (40,571 / 30,008) 7. Acid Test (or Quick) Ratio = Quick Assets : Current liabilities (Quick assets = current assets - stocks) 2007: (42,998 - 2155) / 32,290 ; 2006: (40,571 - 2736) / 30,008 8. Total Asset Turnover = Revenue / Total assets (fixed + current) (times) 2007: (41,363 / 83,164) ; 2006: (35,175 / 73,278) 9. Fixed Asset Turnover = Revenue / Fixed Assets (times) 2007: (41,363 / 8365) ; 2006: (35,175 / 6378) 10. Cash Turnover Ratio = Revenue / Average Cash Balances (times) 2007: {41,363 / [(6780 + 5958)/ 2] }; 2006: {35,175 / [(5958 + 7400) / 2]} 11. Gearing ratio = {Total debt capital / (Total debt capital + Equity funds) }x 100 2007: {(5583 + 3151) / [5583 + 3151 + 17,884] ] x 100; 2006: {(4622 + 3019) / [4622 + 3019 + 14,341] } x 100 12. Debt-Equity ratio = (Debt capital / Equity capital ) x 100 2007: {(5583 + 3151) / 17,884 }x 100; 2006: {(4622 + 3019) / 14,341} x 100 13. Debt Ratio = (Total Debt Finance / Total Assets) x100 2007: {(5583 + 3151) / 83,164}x 100; 2006: {(4622 + 3019) / 73,278}x 100 References Annual Report 2007: Mitsui & Co, Ltd. [Online]www.mitsui.co.jp. Annual Report 2006: Mitsui & Co, Ltd. [Online]www.mitsui.co.jp. Annual Report 2005: Mitsui & Co, Ltd. [Online]www.mitsui.co.jp. Annual Report 2004: Mitsui & Co, Ltd. [Online]www.mitsui.co.jp. "Financial Information: Credit Ratings." www.mitsui.co.jp. "Mitsui &