East Coast Yachts Company Case Study Group 4 Julie Ciarlante Mary Kathryn LoConte Ivy Perez David Zhu East Coast Yachts Background • ECY started in 2002 as a Limited Liability Company (LLC) with the mission of creating custom, high performance yachts for the pleasure sailor. • A commitment to safety, reliability and customer satisfaction helped the company grow steadily for the first seven years in business. • In 2009, the economic downturn and credit crunch hit the boat industry hard and kept the industry flat through 2010. East Coast Yachts Today • ECY was able to survive the most devastating years in the industry’s recent history. • In 2011 business started to pick up and by 2012 ECY was maximizing shareholder …show more content…
Liquidity is lower as compared to the industry, however, the current ratio of 0.74 is above the lower quartile, and this indicates that there are companies with lower liquidity than ECY. This is negative. • The quick ratio is higher than the industry median, this implies that ECY has fewer inventories to current liabilities than the industry median because the cash ratio is lower. The company may have more predictable cash flows, or more access to short term borrowing. This is positive. East Coast Yachts – Question 2 EFFICIENCY RATIOS • The turnover ratios are all higher than the industry upper quartile. This would imply that ECY is more efficient in the use of assets as compared to the industry average. This is positive. • Days sales in inventory is 16 days and days sales in receivables is 10 days for ECY. The competition holds inventory for 40 days and takes 30 days to collect on receivables. Both ratios for ECY are lower than the competition and they are less likely to generate debt and less cash is tied up in assets. This is positive. East Coast Yachts – Question 2 LEVERAGE RATIOS • The financial leverage ratios are all below the industry median, but above the lower quartile. This implies that ECY has less debt than comparable
Pier 1 Imports is a decorative home furnishings and gift retailer with its headquarters in Ft. Worth, Texas. They have over 1,000 stores located most in the United States and additional in Canada (MadDash, 2012). In the same video, Pier 1 recognizes itself as the “original global importer of imported decorative home furnishings and gifts”. The company has 22,200 employees as of the end of its 2014 fiscal year and a revenue of $1,771.7 million making it one of the largest corporations in the DFW Texas area (Pier 1 Imports, Inc, 2014). Though sales associates have a positive relationship with Pier 1, the company 's weaknesses and threats have proven to impact corporate executives and company profits.
The case study on Pacific Oil Company shows from beginning to end the role of power in the outcome of a negotiation. From the beginning, the problem that Pacific Oil Company faced as it reopened negotiations with Reliant Chemical Company was that they did not assert the power necessary to really end up with the outcome of the negotiation they were hoping for. The case study points out several factors that Pacific Oil Company is trying to achieve in the contract negotiations with Reliant Chemical company: the change to a surplus of VCM in the market, the possibility of Pacific Oil needing a supply of their own of VCM to produce their own PVC, and the start-up of several other companies in the production of VCM (Lewiski, n.d.). These
Debt ratio percentages increased for Company G from 28.34% to 29.94%. Industry quartile is 30, 45 and 66 percent, putting Company G below average. Debt Ratio represents strength for Company G.
A more tell tale sign is the quick ratio, or acid test, which has increased year after year. Debt to total assets has decreased over 5% since 2001, indicating less financing of current and long term debt and more company assets. Their cash debt coverage far surpasses the ideal 20%, indicating a high level of solvency with sufficient funds and assets to satisfy all debtors. Asset turnover has more or less maintained at right around 1.6, signifying a turnover rate of just less than 180 times per year.
ratios are low. Wal-Mart’s and Sears’ current ratios are 0.88 and 1.09. It appears that both
1. What is the economic order quantity for standard 5-inch winches if they are ordered from (a) Supplier A, and (b) Supplier B? Round your answers up to the next whole unit, because Narragansett cannot order a fraction of a winch.
Normal compared in the industry, second highest return on equity of the four suppliers. E-drive has the best quick ratio with 1.04.
Next to first-hand experience, case studies are one of the best ways to learn project management skills. In The Crosby Manufacturing Corporation case study, Harold Kerzner reports on the executive-level exchange between the company president and other department heads regarding a new Management Cost and Control System (Kerzner, 2009). This paper will give a synopsis of the case, analyze the case study communications issues and risks, and evaluate Livingston’s selection of a project manager. It will also discuss the possible reactions from the employees, the impact on the cost and time on the
When combining the figures for ROE, ROA and the DuPont analysis it appears that the company is using leverage favourably. ROE is greater than ROA and assets are greater than equity. This is a positive sign for shareholders as it suggests a good investment return in a company that is managing its shareholder equity well (Evans & McDowell, 2009).
Return on Total Assets was 4.43% which is below five percent. That indicates that the company is not accurately converting its assets into profit. The total for Return on Stockholders’ Equity was 8.89%, however financial analysts prefer ROE to range between 15-20 %. The company’s low ROE indicates that the company is not generating profit with new investments. Lastly, Debt-to-Equity ratio for the company was 1.01 which indicates that investors and creditors are equally sharing assets. In the view of creditors, they see a high ratio as a risk factor because it can indicate that investors are not investing due to the company’s overall performance. The totals of these three ratios demonstrate that the company’s financial state is not as healthy as it should be.
| The ROE decreased in the last year but still in the good margin of profitability.
later in the project life. With a NPV of less than -$810,000, Scenario 6 is the project with the
What are the main duties of each of the positions that comprise Abernethy and Chapman’s engagement team?
is due to the fact that some of their current customers only buy from special sellers.
The long-term liquidity risk ratio such as LT debt/Equity, D/E, and Total Liabilities to Total Assets all show a decline from year 2005 due to the repayment of debts. The interest coverage ratio also shows a healthy number of 29.45 in comparison to the industrial average of 15.04 indicating a high ability to pay out its interest expense. Such a low relative risk is not surprising due to the nature of its business depending heavily in R&D development and large intangible assets.