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Essay about NEXT PLC: Company Analysis

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Introduction This report is going to use annual report to analyze the Next PLC through multiple point of view for the purpose of advise, and the final user will be the board of NEXT PLC. The report will consist of three parts, firstly, it will illustrate the comparison on performance, financial position and liquidity between year 2010 and 2011, meanwhile compare the same criteria with its competitor - Debenham PLC in 2011. Secondly, Explain and evaluate how the company applies the international accounting standards. In final part, it will have executive summary covering part one and two. PART ONE Compare NEXT PLC Current performance, financial position and liquidity with previous year. Next plc : Next is a UK based retailer company, it …show more content…

Based on Next Annual Report and Account January (2011), the chief executive's review present the A New Normal of company overview, due to the changing consumer environment, Next PLC need to have New avenues of growth, and brand new way to control cost, also, it will be important that retailer have to generate the healthy cash flow with cautious management. Furthermore, enable to know how company efficiently use asset to generate revenue and whether there was improvement between 2010 and 2011, the activity ratios have to calculate out. The ROCE in 2010 and 2011 were 38.91%,41.79%, this number showed how profit generated by capital employed, and the growth figure of ROCE lead to level up efficiency asset used.((NEXT PLC, 2011 page43, 45) The figure for inventory turnover, receivable turnover, and payable turnover in 2010 and 2011 were 46.81 days, 54.98 days; 66.07days, 68.23 days; 83.36days,81.3days; respectively. (ibid) It is clearly show that the inventory and receivable turnover in 2010 was taken lesser day than 2011, in which means inventories took less day to sold out to costumer and the cash credit receive more faster than the 2011, besides, the payable turnover had longer period than 2011, it was also a good example to illustrate that there was more cash flow holding by company, and the overall image of these figure present that the resource had been

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