Financial Analysis Of Next PLC

1209 Words5 Pages
EXECUTIVE SUMMARY

After the merger chain deals with the Kendalls, Hepworth initiated womenswear stores naming it NEXT in 1981. In 1864 before NEXT, Hepworth launched Joseph Hepworth & Son in Leeds which were tailors for menswear. By 1990s, NEXT had widened their clothing categories while undergoing massive global expansion with its outlets count with their brand trading in around 40 different countries. Today, NEXT stands among the top five largest clothing retailers by sales in the United Kingdom competing alongside Supergroup, Marks & Spencer, and others.

Figure 2: Next showroom image from Next PLC official website (Next PLC, 2017)

INTRODUCTION

The below report holds the comprehensive analysis of the financial position and the company’s performance with five years annual reports and accounts in consideration. Currently, Next PLC has
…show more content…
To sum it up, from the year 2013 to 2017, the liquidity of business is on the brighter side with the ability to meet its short-term payable liabilities except for the negligible dip in 2016.

Liquidity ratio of Next PLC in comparison with a competitor:

Figure 3: Current Ratio and Acid Test ratios comparison of Next PLC & Supergroup PLC

If the liquidity ratios are too high, it indicates that a business lacks in terms of investments or sufficient usage of resources, while too low liquidity ratio of a business shows their strategy turning to be a threat leading to financial issues.

EFFICIENCY

For a successful business, its necessary to keep a track of how efficiently and effectively are its resources being used. Efficiency ratios help in figuring out this factor by studying the inventories, sales, trade receivables, trade payables for a year.

Analysis 2013 2014 2015 2016 2017
Inventory Days 49.81 56.29 57.26 65.18
Get Access