Analyse and comment on the recent financial performance of the company
...ers are most concern about the company’s performance. This is because when calculating ROCE (return on capital employed), it shows how much profit does the company earn from the investment. For Springbank Company, their ROCE is lower in the year 2002 of 37.5% compare to year 2001 of 48.34%. This is due to there is a higher administration and distribution expenses in year 2002 and thus caused lower profit before interest, tax and dividends while the company’s capital and reserves also higher in year 2002. In terms of net profit margin and gross profit margin, the results show that there are lower profit margins in year 2002 compare to 2001. This may due to there is a higher cost of sales and higher administration and distribution expenses but the sales amount does not increase which indicates that Springbank does not perform well in year 2002. In overall, the company’s performance in year 2002 does not perform as well as year 2001 due to increase in operating expenses and caused lower ...