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Essay / Research Paper Abstract
This 8 page paper examines the financial performance of Starbucks, the well known international coffee house and coffee company. The paper looks at the different profit levels, the efficiency ratios and liquidity ratios for the company and also compares performance to the general industry figures. The bibliography cites 10 sources.
Page Count:
8 pages (~225 words per page)
File: TS14_TEstarbuck.rtf
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Unformatted sample text from the term paper:
investor it is the finial performance looking at vertical and horizontal measure sot assess the way a company is developing against its own past performance and also against the industry.
If we take an international company such as Starbucks we can use the recent accounts and perform a ratio and performance analysis to assess how the company is progressing. All
figures are taken from the relevant annual accounts or SEC filings. If we look at the revenue growth this is impressive. 2004 saw a 29.9% increase on 2003, and
in turn 2003 saw a 23.9% increase on 2002. This is a very high growth rate and as growth can cost there is always a danger that during growth there
will be additional costs. For this we can look at the patterns in gross and net profit to assess not only the actual levels, but the margins that can then
be used to make a direct comparison. The first of these is the gross profit margin. The gross margin is expressed as a percentage. This is the level of
revenue that remains when all of the direct costs for producing the goods or services are deducted form the revenue (Chadwick, 1997). This indicates the level at which direct costs
account take up revenue. Gross profit 2001 2002 2003 2004 Revenue (a) 2,649.0 3,288.9 4,075.5 5,294.3 Cost of goods sold (b) 1,112.8 1,350.0 1,685.9 2,198.7 Gross profit (c) (a-b)
1,536.2 1,938.9 2,389.6 3,095.6 Gross profit margin (%) (c/a x 100) 57.99% 58.95% 58.63% 58.47% Here we can see that the gross profit margin is fairly steady with very little
fluctuation. This starts to indicate a solid company. However the direct costs are not always the most dangerous area, we also need to look at the other costs which we
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