Working Capital Management Corporate Performance And Financial

Name of the CEO

Discuss about the Working Capital Management Corporate Performance And Financial.

In the current world there are several companies that are performing and efficiency of the company can be determined with the help of the financial performance that is disclosed by the companies in their annual reports every year. In this aspect, the current report concentrates on analysing the financial performance of Caltex Australia Ltd.

Caltex Australia is known to be the petroleum brand name of Chevron Corporation and the company has been functioning in Australia since the year 1900. Caltex functions the largest oil organization retail network in Australia (Caltex 2018). The company has the largest share in accordance to the oil companies in Australia. The organization controlled two petroleum refineries and they are at Kurnell and Lytton out of which Kurnell refinery stopped their manufacturing and converted the refinery into fuel importation terminal for the firm.

By assessing the annual report of Caltex Australia Ltd, it is seen that Julian Segal is the Managing Director and the CEO and he was appointed in this position in the year 2009. He has been holding this position ever since and has been helping the company reach its zenith.

The head office of Caltex Australia Limited is situated at 2 Market Street, Sydney New South Wales 2000 Australia.

The ending date of the last financial year of the organization has been 31^st December 2017.

The products that are manufactured by the company has been fuel, lubricants and oil.

The company has expanded their business and therefore are operational Australia, New Zealand, China, Hong Kong, Malaysia, Taiwan, Philippines, India, South Korea and South Africa.

Caltex Australia Limited has appointed their external auditors to be KPMG and they are in the idea that the financial statements that have been prepared by the company is in accordance to the Corporations Act of 2001. The reports that are disclosed are true and fair and therefore reveal the real financial scenario and the functional activities of the company. Furthermore, all the financial reports are constructed with respect to the Corporations Act and the standards constructed by the IFRS.

This section of the report would look to assess the financial position of Caltex Australia Limited and the profitability of the company would be determined with the analysis of the income statement, the cash flow statement and the balance sheet of the firm.

The income statement has highlighted the fact that the gross profit of the company has increased significantly in the year 2017 with respect to the last two years and it is seen that net profit of the company has increased but the rate has not been very higher with respect to the last year. The earnings per share have decreased as well (Caltex 2018). The overall analysis of the company has shown a rise in the level of profit and thereby explaining that the company has been performing significantly well in the economy.

Head Office

The balance sheet of the company has even revealed that the operations of the business have increased and therefore there has been a rise in the total asset of the firm as well in accordance to the last two years (Caltex 2018). In the same way, it is seen that liabilities of the company has increased as well as the company has been looking to take additional debts and capitals in order to expand their business.

The cash flow statement that has been constructed for Caltex Australia has explained that the company has significant amount of investments and finances and in the year 2017 the investing activities have increased. The financial activities of the company have increased as well and this has indicated that as the company is expanding their business. The financial activities have even increased and therefore it can be said that the company from the past two years of 2015 and 2016 have been able to improve their financial performance and accordingly have even been able to maintain effective level of operational activities (Caltex 2018).         

The net income that has been discovered from the operational activities has shown that the net income of the company has increased in the year 2017 with respect to the previous years and therefore it can be said that the financial performance of the company has been effective.

The financial performance that has been observed for Caltex Australia Ltd has been better with respect to the other companies from the same sector as the figures that have been obtained with respect to the net income of the company has been very much better than the others and the company has been performing in accordance to the overall industrial standards (Caltex 2018). Therefore, it can be said that the company has been performing efficiently.

The liquidity ratio that has been attained for the company explains the fact that the ratios are significantly good and it is seen value has been more than 1. Even though the ratio has declined with respect to the previous years but still the values have been better and these figures indicate the effectiveness of the business.

The profitability ratios of the company has been good as well as it is seen that the company is operating in an effective manner. The profit margin has been good and in the same manner the asset turnover ratio has been effective as well. The return on equity has been good even though the return on equity in the year 2017 has decreased with respect to last year. The profitability ratio of the company has indicated that the company has been performing in an effective manner.

End date of the last financial year

The debt to equity ratio has improved in the year 2017 in accordance to the past two years and it is seen that the interest coverage ratio was negative in the year 2016 but in 2017, the interest coverage ratio has become positive thereby indicating that the company has been able to provide interest as well.

The director’s report has been analysed and accordingly an idea can be attained with respect to the steps and the actions that have been undertaken by the management in order to improve the actions of the business and in the same manner looks to take care of the society and the environment as well.

The corporate governance statement that has been constructed by the company addresses the fact that the company has taken several steps in order to take care of the sentiments of their customers as well as their employees. There are several risks that are associated to the business and therefore the company has a risk assessment plan with the help of which they are able to identify the risks and accordingly undertake risk management strategies in order to mitigate the risks that are existent with the company (Caltex 2018). The company has their own contingency plans with the help of which the management is able to take care of the unprecedented risks and maintain effective level of operational activities. The company has a risk controlling plan with the help of which the company is able to understand the issues that are pertinent with the operational activities.

The director’s report has even addressed that they focus on constructing effective financial reports so that the reports can be understood by anyone who is in need of it. The company has their own internal auditors who assess the results that have been disclosed by the external auditors and accordingly take steps with the help of which the financial reports that have been disclosed remains true and fair (Caltex 2018). The management has a positive attitude towards financial reporting and therefore maintains all their financial records properly so that it can be looked down upon during the time of need.

The business activities that are performed by the business are properly monitored so that any kind of faults and errors that are existent within the business can be identified at the ground level and can be rectified in a proper way. It is seen that the management has positive attitude towards the information processing and accounting functions and therefore maintains updated accounting system software with the help of which accurate recording of the financial transactions can be maintained.

Products and Services

The employees are regarded as the bloodline for the business and therefore they take care of their employees by remunerating them and maintaining a fair payment scheme for them. The company takes care of their investors as well as it is seen that the firm records the sentiments of the investors and accordingly looks to provide dividends to them. The size of the industry is increasing and therefore actions and future plans have been constructed with the help of which the company is able to maintain a sustainable competitive edge. The market shares of the competitors are not so much in accordance to Caltex Australia Ltd and therefore it can be said that the company has a good level of market share in Australia.

Conclusion 

The results that have been obtained explain the fact that Caltex Australia has effective level of financial performance and therefore it can be said that the company has been performing in an effective manner within the economy. The financial performance that have been discovered for the company indicates that the company has been looking to increase their level of sales and their operational activities with the help of which the company is able to increase their market share and competitive edge. The director’s report has even explained that the management is taking several actions and steps in order to improve their overall business and in the same manner assess the external market and take care of their internal and external stakeholders.

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