Danone Financial Statement Analysis

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DANONE Case - Financial analysis of Danone group PENG Bo (e113110) GE Chuxiao(e113051) JIANG Yihong(e113066) Fiancial Statement Analysis – Danone Case Agenda • Introduction • Capital structure • Profitability • Return • Liquidity • Solvency • Conclusions & Recommendations Fiancial Statement Analysis – Danone Case Introduction of DANONE Group History Initiate in 1966, DANONE evolved from the original glass manufacturer to the international leader in fresh diary products. Mission “bringing health through food to as many people as possible” Divisions the Fresh Dairy Products Division the Waters Division the Baby Nutrition Division the Medical Nutrition Division Global Approach The group now…show more content…
Danone should consider taking some internal cost control process to offset the effect. Fiancial Statement Analysis – Danone Case Profitability Analysis Relatively stable profitability From the graph:  EBIT margin grew from 2007 to 2008 then kept it on a stable level. Hypothesis:  In 2007, Danone’s high level of OWC result in the low EBIT margin.  The low elasticity of food & beverage industry enable Danone keep its steady level of operating margin. Conclusion:  It is good for the group to keep a steady EBIT margin. To achieve further increase in EBIT margin. Danone can take the product development into consideration which can lead to a higher profit margin. *According to the company annual report we consider trading operating income as EBIT Fiancial Statement Analysis – Danone Case Profitability Analysis Relatively stable return on equity From the chart on the right, we can obviously see a dramatic decrease on the ROE from 2007 to 2008. After a careful check of the notes in the annual report, we found during 2007, the group dropped its “Biscuits and cereal product” business activities. The sale of the business was

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