Oroton Group

1463 WordsSep 19, 20136 Pages
Contents 1. Cover Page 2. Contents page 3. Company Overview 4. Profitability Ratios 5. Liquidity Ratios 6. Gearing Ratios 7. Conclusion and Summary 8. References and Appendices 9. Appendices Continued 10. Appendices Continued Company Overview OrotonGroup is the Australian and New Zealand retailer and owner of the Polo Ralph Lauren licence and Oroton brand. For nearly 20 years OrotonGroup has been the Polo Ralph Lauren licence owner for the Australia and New Zealand territory. OrotonGroup Limited is a Public Company that is ranked number 1240 out of the top 2000 companies in Australia. In 2006 OrotonGroup Limited had 869 employees in Australia including employees from all subsidiaries under the company 's…show more content…
In 2005 and 2006, the results for the acid test ratio are fairly low compared to a preferable ratio of 1:1. The figures indicate that in the short term, the Oroton Group would only be able to pay back 49% and 47% of currents liabilities respectively in the very short term. In 2007, this figure rose to 78% which is a better ratio, although still not at the preferable ratio. gEARING RATIOS In 2005, 28.83% of the claims on the business (apart from those related to working capital) have been provided by outsiders. They created enough profit to cover their interest expense for the year 30.29 times. It would take the company 5.13 years to pay back all their liabilities. In 2006, 46.32% of the claims on the business (apart from those related to working capital) have been provided by outsiders. They did not create enough profit to cover their interest expense for the year as this figure was minus 4.69 times. It would take the company 2.49 years to pay back all their liabilities. In 2007, 7.87% of the claims on the business (apart from those related to working capital) have been provided by outsiders. They created enough profit to cover their interest expense for the year 34.03 times. It would take the company 1.24 years to pay back all their liabilities. In all three periods which have been assessed, the Oroton Group has created a greater return on the borrowed funds than the interest that they had paying on those funds. This means that the
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