Report on Financial Analysis and Evaluation of Growth Strategy of Nixon Group Plc

Overview of Financial Performance of Nixon Group Plc

Please refer to your Student Handbook for full details of the programme assessment scheme and general information on preparing and submitting assignments.

1. Understand and evaluate the uses of both quantitative and qualitative accounting information, within an organisation.
2. Apply theoretical concepts and framework to a range of practical situations in order to propose solutions to strategic business problems.
3. Apply and critique key management accounting techniques.
4. Demonstrate critical thinking and analysis in showing how the finance function can contribute to the successful strategic management of an organisation.
5. Recognise the skills required to communicate effectively at senior level and be able to put these skills into practice.
6. Use financial information to improve an organisation’s strategic performance.
7. Discipline expertise: Develop the skills required to independently access and process financial data.

Currently the market is highly competitive and the board of Directors have come up withthe mission being to facilitate global household connectivity by 2025.

You are to produce a report with the Corporate Investors as your audience
a) An overview of the financial performance of the group in the last 5 years, commencing from 2013 to 2017. This should focus on revenues, operating costs and net profits of the company.

b) A critical evaluation of the management growth strategy, through investment activities, aimed at ensuring the attainment of objectives.

c) An evaluation of the Activity ratios, with focus on determining the Cash Conversion Cycle (CCC), for 2016 and 2017. Evaluate management’s strategy of ensuring minimal exposure to credit risks. Determine the impact on Cash flow?

Your report should include the excel file of the financial statements for the 5 years within your report’s appendix. You may use graphs to illustrate your analysis.

Nixon Group Plc. is a global company with markets across Europe, Middle East, America and Africa (EMEAA). The global board of directors are currently reviewing the attached income statement for regional sales and profits, and are considering a range of strategic decisions bordering on the following:

• Maximizing revenue for profit making regional establishments and possible closure of loss-making areas. Any closures would incur an 8% of projected admin and distribution costs, as redundancy payments for staff in the affected regions.
• Development of commercial strategies considering other factors.
• Consideration of the regional interest costs and ease of obtaining funding,
• Operating expenses, including Administrative and Distribution expenses,
• Consider impact of government taxes, being a percentage of PBIT. (For this aspect, loss-making regions make projections to determine potential tax rates, to find impact on any arising profits.
• Projected regional net profits & contribution to Group Net Profits.

a) Outline and discuss the significance of defining and communicating the mission and values of a company, to all employees by senior management.
 
b) Taking into consideration the performance in the current financial statements, prepare a schedule including Group projected Statement of Comprehensive Incomes, following the strategic options available to the group, stating your assumptions clearly within your strategic plan for implementation.

c) Critically evaluate the significance of reporting the financial performance of the Group, in country segments. Your analysis should consider the accounting concepts which are applicable and the importance to stakeholders.