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FS Analysis

The document provides recommendations for Ayala Land Inc. and SM Prime Holdings to enhance liquidity management, operational efficiency, and profitability. Ayala Land should focus on improving receivables collection, reassessing its debt strategy, and controlling costs, while SM Prime needs to stabilize its short-term liquidity and enhance operating cash flow. Financial ratios for both companies are presented, highlighting their profitability, liquidity, and solvency metrics for 2022 and 2023.

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34 views2 pages

FS Analysis

The document provides recommendations for Ayala Land Inc. and SM Prime Holdings to enhance liquidity management, operational efficiency, and profitability. Ayala Land should focus on improving receivables collection, reassessing its debt strategy, and controlling costs, while SM Prime needs to stabilize its short-term liquidity and enhance operating cash flow. Financial ratios for both companies are presented, highlighting their profitability, liquidity, and solvency metrics for 2022 and 2023.

Uploaded by

canasmaryruth
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Group 2 - Property

RECOMMENDATIONS
Ayala Land Inc.
It is recommended that the company strengthen its liquidity management by improving receivables
collection and reducing excess inventory. It should also reassess its debt strategy, possibly by refinancing
existing obligations or slowing new borrowing to maintain a balanced capital structure. Operational efficiency
could be improved by reviewing inventory practices and optimizing asset utilization. To sustain and enhance
profitability, continued focus on cost control and strategic pricing is crucial. Lastly, as leverage grows, the
company must closely monitor financial risk and ensure that it maintains sufficient cash flows to cover debt
obligations comfortably.

SM Prime Holdings
To boost profitability and efficiency, SM Prime should sustain its operational improvements and analyze
the factors impacting its pre-tax profit, while maintaining a cautious approach to financing to manage debt and
fund growth, as indicated by improved debt coverage ratios, though focus is needed on enhancing operating
cash flow. Furthermore, the significant drop in short-term liquidity ratios requires investigation and stabilization
of working capital through a balanced mix of cash, receivables, and inventory to avoid over-reliance on any
single liquid asset.

Canas, castro, cervantes, daan, De vera, dumdum, Espinosa, fernan, Gierran


Group 2 - Property

RATIOS AYALA LAND INC. SM PRIME


HOLDINGS
Gross Margin 2023 24.49% 47.83%
2022 22.30% 46.55%
COGS 2023 75.51% 52.17%
2022 77.70% 53.45%
Operating EBIT 2023 18.51% 35.48%
Margin 2022 16.56% 32.20%
Pre-tax Margin 2023 24.49% 36.93%
2022 22.30% 35.71%
Net Profit Margin 2023 19.48% 36.94%
2022 17.80% 35.71%
PROFITABILITY Return on Assets 2023 3.57% 4.50%
2022 2.77% 3. 66%
RATIOS 2023 6.14% 6.74%
Basic Earning
Power 2022 5.21% 5.86%
Return on Fixed 2023 74.93% 27. 65%
Assets 2022 57.80% 22. 18%
Return on Equity 2023 9.45% 10. 70%
2022 7.98% 8. 79%
Current Ratio 2023 1.76 1.26
2022 1.78 1.53
Quick Ratio 2023 0.52 0.64
2022 0.56 0.86
LIQUIDITY Cash Ratio 2023 0.07 0.80
2022 0.07 0.29
RATIOS 2023 0.1 0.66
Operating Cash
Flow Ratio 2022 0.13 0.24
Working Capital 2023 178,780,394 45,039,620
2022 157,333,461 76,837,934
Debt Ratio 2023 0.307 0.423
2022 0.301 0.447
Debt-to-Equity 2023 0.811 1
Ratio 2022 0.799 1.070
Net Gearing 2023 0.058 0. 920
2022 0.760 0.955
Equity Multiplier 2023 2.65 2. 379
SOLVENCY 2022 2.703 2.400
RATIO Interest Coverage 2023 3.955 5. 252
2022 3.678 4.295
Fixed Charge 2023 2.291 5. 204
Interest Coverage 2022 2.041 4.271
Ratio
Cash Flow 2023 0.042 0. 157
Coverage Ratio 2022 0.055 0.071

Cash Flow 2023 0.046 0. 205


Adequacy 2022 0.046 0.123
Degree of 2023 1.338 1.235
Financial Leverage 2022 2.155 1.304
Ratio

Canas, castro, cervantes, daan, De vera, dumdum, Espinosa, fernan, Gierran

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