assessment of action sa financial condition in terms of...

Projekt współfinansowany ze środków Unii Europejskiej w ramach Europejskiego Funduszu Społecznego

Człowiek – najlepsza inwestycja

ASSESSMENT OFACTION SA CAPITAL GROUP

FINANCIAL CONDITIONIN TERMS OF INVOLVED CREDIT RISK

[Ocena kondycji finansowej Grupy Kapitałowej Action SA pod kątem ryzyka

kredytowego]

BA Supervisor: Robert Sobków, PhDFaculty: English Philology

Specialization: Managerial Linguistics

• Poznańska Wyższa Szkoła Biznesu • POZNAN UNIVERSITY COLLEGE OF BUSINESS • • Student ID / Log Book No: 3921 • Poznań, 30-06-2014 • Bachelor Degree Thesis •

2014

Joanna Mariasiewicz

Człowiek – najlepsza inwestycjaul. Niedziałkowskiego 1861-579 Poznańwww.pwsb.pl


Chapter One Action SA Capital Group structure and sector of activity

Following chapter will provide information on company’s activity, shareholders, group

structure and main market competitors.

1. Action SA – basic information

Action SA is a wholesale distributor of IT equipment. In addition to its own brands, it sells

products of some of the world's biggest computer firms. Its main suppliers include AMD,

Hyundai, Intel, LG, Microsoft, Samsung, Sony. Action SA customers include retail and

corporate clients. In addition to distribution, Action manufactures computer hardware. It sells

desktop computers, monitors, MP3 players and UPS devices under its own brands (Actina,

ActiveJet).

Action SA is dominant entity of Action SA Capital Group. It is listed on WSE.

1.1 Sector of activity

According to registered PKD codes (Polska Klasyfikacja Działalności – Polish Business

Activity Classification) Action SA operates in:

Section C – Manufacturing, Divisions: 18, 26, 27, 33,

Section D – Production and supply of electricity, gas, steam, hot water and air for

conditioning,

Section F – Construction, Divisions: 41, 43,

Section G - Wholesale and retail, Divisions: 46, 47,

Section H - Transport and storage, Division 53,

Section J - Information and communication, Divisions: 58, 61, 62, 63,

Section K - Financial and insurance activities, Divisions: 64, 66,

Section L - Activities related to real estate, Division 68,

Section M - Professional, scientific and technical activities, Divisions: 70, 71, 72, 73,

74,

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Section N - Administration and support services activity, Divisions: 77, 79, 82,

Section P – Education,

Section R - Culture, entertainment and recreation activities, Division 93,

Section S - Other service activities, Division 95 (www.spg2online.lexisnexis.pl).

More detailed list of PKD codes is available in Appendix 1.

On Action SA website (www.action.pl) there is information that company operates in

areas of IT, consumer electronics and appliances, peripheral equipment trade and production.

Main objective is to promote and provide innovative solutions. Group uses the Internet as one

of most important sales channels and owns a storage centre equipped with latest technological

facilities.

1.2 Registration details and history

Action SA is located in Warsaw, on Jana Kazimierza Street, 46/54. Company VAT is

PL5271107221, REGON 011909816, KRS 0000214038, share capital (paid in full) 1 661 k

PLN. Action SA is a joint stock, listed company.

Company was established in 1991 as ltd by Piotr Bieliński. In 2004 it was transformed

into Joint Stock Company. Since 2006 Action SA is listed on WSE.

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1.3 Shareholders structure

Based on most recent information Action SA shareholders structure is following:

Picture 4. Shareholders structure. Source: (www.action.pl)

1.4 Sales structure

The basic scope of Action SA Capital Group’s activity is the distribution of computer

hardware and software, nevertheless detailed sales structure year over year differs slightly,

mainly due to changes in customers’ demand.

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Table below presents sales structure for 2013 in terms of groups of goods offered.

Itemno.

Group of goods Sales value in 2013 % Sales value in 2012 %

1 Ready solutions 1 570 561 33,07% 1 387 585 39,47%2 Consumer electronics 2 042 860 43,01% 1 143 695 32,54%3 Components 640 829 13,49% 499 135 14,20%4 Peripherals 149 159 3,14% 180 651 5,14%5 Consumables and

office supplies231 235 4,87% 200 692 5,71%

6 Software 97 758 2,06% 81 810 2,33%7 Other 16 691 0,35% 21 621 0,61%

Total revenues 4 749 183 100,00% 3 515 189 100,00%Table 1. Own study, based on management report.

In 2013 sales structure in terms of group of goods changed slightly compared with

2012: ready solutions with 33% share in total sales (from 39,5% in 2012) became second

biggest group after consumer electronics, which share increased to 43% (from 32,5% in

2012).

The Group’s basic market is domestic distribution market. In 2013 it generated 64% of

net sales of goods and materials. The territorial sales structure within the selected years was as

follows:

Net revenues from sales of goods and

materials (geographical structure)Change 2013 2012

Domestics sales 24,4% 2 978 585 2 394 457

Export 87,4% 419 323 223 768

EU supplies 55,5% 1 254 304 806 621

Total net revenues from sales 35,8% 4 652 212 3 424 846

Table 2. Geographical sales structure. Own study, based on management report.

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1.5 Key figures

Action SA consolidated results for 12/2013 (12 months), 12/2012 (12months) in mn PLN

2013 2012 Percentage change YoY

Sales (change) 4 749 3 515 +35%Gross profit on sales (margin)

297 226 +31%

Pre-tax profit 77 61 +26%Net profit 62 48 +29%Net worth 299 260 +15%Current ratio 1,35 1,42

Table 3. Key results and figures. Own study, based on Consolidated Financial Statement 2013.

In subsequent chapters consolidated accounts will be analysed in detail. Before that,

brief summary in table above is sufficient to present general trend in results. In 2013 sales of

group have significantly increased, by 35%, compared with results of 2012. Net profit also

displays excellent development (29%). Along with growth on profit and loss statement site,

balance sheet structure remains sound and solid, with increasing equity and good liquidity.

2. Action SA Capital Group structure

Action SA forms Action SA Capital Group in which it is the Parent Entity, and therefore it

bears the main responsibility for the entire process of purchasing computer hardware and

goods included in the offer of the entities comprising the Group. Moreover, Action SA is

responsible for the distribution, production of equipment under own brand names,

maintenance of the internet sales channel, marketing and public relations activities, as well as

overall management of the group.

Entities of the Group are as following, with their short description:

Actina - produces computers and servers under its own brand name,

Sferis - chain of stores, currently consist of 24 own outlets, 46 "island" outlets and 127

partner outlets,

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Portal gram.pl which functions as information and social networking website devoted

to computer games and consoles with an internet shop of the same name,

Mobistyle Sp. z o.o. - an entity beginning its business activity of selling hardware and

providing advertising services based on its own portal,

Action Centrum Edukacyjne Sp. z o. o. and Systems Sp. z o. o. - entities specialising

in providing training services,

Activebrand Sp. z o.o. - an entity which has begun activities in the marketing services

sector,

Devil GmbH - an entity commencing distribution activities in the wholesale of IT

products and household appliances,

Retail World Sp. z o.o. - an entity commencing operations in the wholesale of IT

equipment and IT accessories to foreign customers,

SFK Sp. z o.o. - an entity providing advertising services.

Picture bellows presents group structure:

Picture 5. Action SA Group Structure. Source: Consolidated Financial Statement 2013.

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Strategic aim of Action Group is the continuous development of parent entity and all

subsidiaries and affiliates, increase in its market share in domestic market and abroad, as well

as the increase in value for shareholders. In a medium-term perspective, the fundamental

element of this strategy is establishing the leading position on the market of IT and household

appliances and audio/video distributors, as well computer hardware producers.

3. Sector and direct competition

IT sector is characteristic with – among others – low margins and high seasonality, with sales

substantially higher in 4th quarter. Taking that into account while considering closest

competition, main focus will be put on last quarter of 2013. Low margins result in high

consolidation of market, and as a result – only high volume sales can guarantee top position

and market share. As those concentration processes have been occurring for many years by

now, there are three key players on Polish IT distribution market – next to Action SA those

are: AB SA and ABC Data SA.

3.1 Competitive landscape

12/2013 ABC DATA AB ACTION(4th quarter

only)1PLN PLN PLN

Sales 1 426 +10% 1 638 -1% 1 488 +30%Gross profit 73 +11% 89 +65% 99 +43%

Pre-tax profit 24 stable 27 +35% 23 +10%Net profit 20 +25% 21 +24% 19 +12%

Table 4. Own study, based on consolidated statements of compared groups. Statements available on

(www.abcdata.com.pl , www.ab.pl, www.action.pl)

1 Compared with 4th quarter of 20127



3.2 Sector specification

Poland is one of the more attractive IT markets in Europe, with positive underlying trends

within the IT market that will ensure growth over the medium term in the hardware, software

and services segments. In years 2004-2008 IT market increased by over 10% each year,

nevertheless after decrease in 2009 its dynamics never recovered to two digits. Hardware

continues to hold the biggest share In IT market but for many years by now its increase has

slowed pace, especially compared with IT services and software. In past 3 years IT market

increased by 3% on average, with PKB growth it might increase up to 5% taking into

consideration level of saturation. As far as IT distribution is concerned, sector is divided

between 3 biggest players: AB SA, ABC Data SA and Action, holding similar market shares

and controlling altogether 76-78% of market. Those three companies grow much faster than

market, taking over smaller distributors’ market shares and entering other, higher – margins

sectors (like toys in case of AB SA).

It is forecasted that Poland will be home to one of the fastest-growing IT markets in

Central and Eastern Europe 2014-2018, with growth accelerating as the economy strengthens.

There is, however, downside risk to this outlook, emanating from the uncertain security

situation in neighbouring Ukraine.

In the enterprise segment, the more difficult economic conditions of recent years have

shaped the opportunities for IT vendors. Enterprises have adopted a closer focus on cutting

costs, resulting in companies in many sectors looking to spend on IT solutions and services

that streamline and optimise business processes. One potential demand driver will be

organisations looking for help to utilise efficiencies from cloud computing such as Software-

as-a-Service and Infrastructure-as-a-Service. Particular areas of opportunity for cloud

computing include banking and retailing, as organisations in those fields look to save money

on hardware investments. Meanwhile, small and medium enterprises are expected to provide

particular opportunities for cloud computing services, with a higher number of computers per

business stimulating demand for more sophisticated solutions and services. Financial sector

spending is expected to remain fairly strong despite having fallen off slightly as many banks

have recently completed major projects. Investment by telecoms operators will be another

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growth driver, while utilities have provided a particularly strong source of opportunity in

2011 and 2012, and this should continue due to privatisation and modernisation initiatives in

this sector. Some market analysis predict that after many years of falling margins, market

competition will settle down resulting in higher margins (Based on own study and Polish IT

Sector Report by IntelliNews from EMERGING MARKETS DIRECT MEDIA HOLDINGS).

3.3 Products types

Main Polish companies from sector are IT distributors: AB SA, ABC Data SA, Action SA.

All of them, apart from distribution, offer some products under own brand (toners, tablets).

Other meaningful players are Komputronik Sp. z o.o., Tech Data Polska Sp. z o.o., INCOM

SA and Veracomp SA.

Since margins on IT equipment are low, many companies seek for additional sources

of income – either by increased export (ABC Data SA, Action SA) or by adding additional

products/ services to their offer – AB SA this year reactivated Optimus brand (which is

supposed to be specialized in tenders) and bought leading toys distributor, Rekmann Sp. z o.o.

Another type of companies are integrators. Most popular and frequently assessed are: Asseco

Poland SA, ATM Systemy Informatyczne SA, Betacom SA, Comarch SA, Qumak SA,

Sygnity SA. Smaller integrators, especially those providing services to public sector,

encounter high seasonality (cost are recorded all year long, however sales are invoiced in 4th

quarter mainly).

It is estimated that ~1/3 of IT sales in Poland is realized by ~350 biggest companies.

Main buyers for them are administration and public institutions, banking, and

telecommunication.

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3.4 Payment terms and morale

In case of regular cooperation payment terms are usually in range of 14-90 days, majority up

to 45. Longer payment terms occur in case of contracts for projects.

In ITC only slight delays in payment are acceptable - usually up to one week, since

those are not reported to collection departments. This behaviour is common even for biggest

players like AB SA, Action SA or ABC Data. In paydex by Bisnode it is usually reflected by

78-79.

For smaller companies overdues up to 15 days might be reported. Situation looks

worse for companies specialising in engineering and construction/IT, overdues can reach over

30 days and trade receivables and payables are often relatively long – in those cases aging of

payables and receivables can be requested to determine payment morale.

3.5 Financial aspects of ITC sector

While performing analysis on companies from this sector special emphasize is put on

following: development of turnover, solvability, gearing, turnover ratios.

It is common in ITC sector that the companies have low NW, with positive working

capital, solvability very often does not exceed 25% (situation looks even worse in case of

system integrators with seasonality even higher than distributors). Sales increase by ca 10%

per year in small and medium entities, and even by 30% in the biggest companies (IT

distributors and integrators realizing public tenders).

Due to very high competition, level of profitability rarely exceeds 2%. Whole sector

has to deal with low margins and focus on cutting costs. Rotation of stock, trade payables and

trade receivables for distributors is below 60 days and approaches to even 100 days for IT

integrators, especially during the realization of tender. Liquidity is very often strained and the

current ratio 1,0 – 1,5 is satisfactory.

It is characteristic for this sector that companies have diversified portfolio of

contractors and change their suppliers.

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3.6 Outlook for 2014

Outlook for this year in terms of turnover and production includes further increase of big

distributors’ results at the expense of smaller companies. It is the only possible way for

further growth as for now demand for hardware and consumer electronics is rather flat. That

is also main reason (high competition) for strong price pressure, and next to exchange rates,

cause of low margins.

3.7 Seasonality

Seasonality is characteristic for ICT sector. In the last quarter companies work out sometimes

even 30-50% of annual turnover.

Chapter Two Ratio analysis

In this chapter main focus will be put on presenting chosen financial ratios chosen for analysis

– their formula and explanation. In second part of chapter ratios for Action SA Capital Group

will be calculated.

1. Methodology of financial ratios chosen for analysis

In order to prepare analysis of credit risk, our main focus will be on liquidity, solvency and

efficiency ratios.

1.1 Liquidity ratios

Liquidity ratios assess the availability of cash to pay debt.

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The Current Ratio is calculated by dividing Current Assets by Current Liabilities.

Current Assets are the assets that the company anticipates to convert into cash in the next year

and Current Liabilities represent the liabilities which are to be paid in cash in the next year.

The appropriate value for this ratio depends on the industry and the structure of its Current

Assets. Nevertheless, at a minimum, the Current Ratio should be greater than one.

The Quick Ratio identifies that, for many companies, Stock can be rather illiquid. If

that Stock had to be sold off in an urgency to meet an obligation, the company might have

difficulty in finding a purchaser, and the Stock would likely have to be sold at a substantially

lower amount below their fair market value.

This ratio attempts to measure the ability of the company to meet its obligations

relying only on its most liquid Current Asset such as Cash and its equivalents. Cash Ratio is

calculated as company's total Cash and cash equivalents to its current liabilities. The Cash

Ratio is most commonly used as a measure of company liquidity. It can therefore determine

if, and how fast, the company can repay its short-term debt. A strong cash ratio is useful to

creditors when deciding how much debt, if any, they would be willing to extend to the asking

party.

1.2 Solvency/ debt ratios

Debt Ratios aim to measure the company’s use of Financial Leverage and ability to avoid

financial problems in the long run. These ratios are also known as Solvency Ratios.

Debt is called Financial Leverage because the use of it can improve returns to

shareholders in good years and increase their losses in bad years. Debt by and large represents 12



a fixed cost of financing to a company. Consequently, if the firm can earn more on assets

which are financed with debt than the cost of servicing this debt, then these surplus earnings

will flow through to the shareholders.

With the use of debt also comes the possibility of financial problems and - eventually -

bankruptcy. The amount of debt that a company can apply is dictated to a great extent by the

characteristics of the company’s industry. Firms which are in industries with volatile sales and

cash flows cannot apply debt to the same extent as firms in industries with stable sales and

cash flows. Hence, the optimal mix of debt for a company involves a trade-off between the

benefits of leverage and risk of financial problems.

Solvability is a solvency ratio presenting which part of Total Assets are financed by

own capital.

Gearing is a measure of financial leverage, indicating the degree to which a company’s

activities are funded by shareholders’ funds versus creditor's funds. The higher a company's

level of leverage, the more the company is considered risky. As for most ratios, an acceptable

level is assessed by its evaluation to ratios of companies in the same industry.

A company with high Gearing (high leverage) is more vulnerable to recessions in the

business cycle since the company must continue to service its debt regardless of how bad

sales are. A greater ratio of equity provides a cushion and is seen as a measure of financial

strength.

Gearing Ratio above informs who is in fact taking risk on a business – the banks or the

shareholders.

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Short Term Gearing ratio excludes long term loans and credits from calculation. In

general, from financial analysis point of view, long term debt is considered less risky and

more acceptable.

The net debt to EBITDA Ratio is popular with analysts since it takes into account a

company's ability to decrease its debt. Ratios higher than 3,2 usually set off alarm bells as this

indicates that a company is less likely to be able to handle its debt, and thus is less likely to be

able to take on the additional debt required for business growth. Eventually, however, it

depends on the benchmark of the industry.

Interest Cover ratio informs how many times can the debt – related interest be paid

from that year’s operating profit.

Tangible Net Worth is not technically a ratio, as there is no division in its formula, but

it provides truer value of equity, stripping Net Worth out of Goodwill and Intangibles yet to

be amortised.

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1.3 Efficiency ratios

Efficiency ratios measure the effectiveness of the firm’s use of resources.

Debtor Days provides information on how many days credit are offered to aid sales. It

is also important to notice that if the cycle is over terms of trade, this may indicate collection

problems.

Stock Days provides information on how long on average does Stock take to be

converted into sales.

This ratio informs how many days credit have been taken from suppliers. If the cycle

is in excess of terms of trade, supplier might be experiencing collection problems.

Usually – and in case of our analysis – a company acquires Stock on credit, which

results in payables. A company can also sell products on credit, which results in receivables.

Cash, therefore, is not involved until the company pays the accounts payable and

collects accounts receivable. So the cash conversion cycle measures the time between outlay

of cash and cash recovery.

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Fixed-Asset Turnover is a classic productivity ratio. This ratio is a rough measure of

the productivity of a company's fixed assets (property, plant and equipment or other) with

respect to generating sales. For most companies, their investment in fixed assets represents the

single largest component of their total assets. This annual turnover ratio is designed to

reflect a company's efficiency in managing these significant assets.

1.4 Profitability ratios

Profitability ratios measure the company's use of its assets and control of its expenses to

generate an adequate rate of return.

Gross Margin directly tells how much of the sales is profit.

Level of profitability after fixed and variable costs associated with the normal course

of business.

Profitability is calculated with total sales taken as base times 100. It is the percentage

of sales that turned into profit.

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It measures company’s efficiency at generating profits from every unit of shareholders'

equity. ROE shows how well a company uses funds to generate earnings growth. ROEs

between 15% and 20% are generally considered good.

The return on assets (ROA) shows how profitable a company's assets are in generating

revenue. ROAs over 5% are generally considered good.

1.5 Market Value ratios

Market Value Ratios relate an observable market value, the stock price, to book values

obtained from the firm's financial statements.

Earnings per share - The portion of a company's profit allocated to each outstanding

share.

Price/ Book ratio - a ratio used to compare a stock's market value to its book value. It

is calculated by dividing the current closing price of the stock by the latest year's book value

per share. 17



Enterprise value/ Gross Sales - dividing the enterprise value of a firm by its sales or

revenues, is a way of comparing firms in cyclical industries.

2. Ratios analysis of Action SA compared with ABC Data SA and AB SA

In this section ratios presented in above subchapter will be calculated for Action SA, ABC

Data SA and AB SA. All three companies are quoted on WSE, operate in the same industry

and record similar sales and profits. Comparison between three core competitors will enable

to find benchmark and relate to it Actions SA results. It should be noted that AB SA has

different financial year, however for our analysis needs it does not cause problem.

2.1 Liquidity ratios

Ratio Action SA ABC Data SA AB SA Average

Current Ratio 1,19 1,40 1,35 1,32


Quick Ratio 0,75 0,86 0,74 0,78


Cash Ratio 0,04 0,03 0,02 0,03

Liquidity ratios calculated for companies Action SA, ABC Data SA and AB SA show that all

three competitors have sufficient Current Assets to cover Short Term Liabilities. Action SA

has the lowest Current Ratio, noticeably below average for three companies. Quick Ratio for

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Action SA is just below average and on similar level to AB SA. In terms of Cash Ratio (also

referred to as Acid Test Ratio) Action SA recorded highest result. It indicates that Action SA

Cash and Equivalents accounted for bigger quantity of Current Assets than it was in case of

two other companies.

2.2 Solvency/ debt ratios


Solvability 26,13 34,45 36,04 32,20

Action SA has the lowest Solvability Ratio among companies included in assessment.

Received result is noticeably below average. In general, results above 20 are considered

acceptable, though it is certain that out of three competitors Action SA is the one transferring

the risk of business from shareholders to banks.


Tangible Net Worth 287 617,00 274 782,00 378 570,00 313 656,33

In above table there are nominal results of Tangible Net Worth, excluding Goodwill. It

is unfortunately quite common for companies from IT sector to present high Goodwill in their

statements, which increases Net Worth in balance sheet structure and as results – makes

balance sheet look more solid. In case of analysed companies Goodwill has significant value

as all three companies are broadly recognisable.


Solvability on TNW 24,92 29,98 32,43 29,11

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Having calculated Tangible Net Worth it is possible to determine Solvability Ratio

based on Tangible Net Worth. Action SA recorded the smallest dispersion between

Solvability and TNW Solvability.


Gearing 26,71 44,66 50,40 40,59

Gearing Ratio results in table above show that among three assessed companies Action

SA has the lowest amount of bank credits and loans compared to equity. It is significantly

below average and only a half of AB SA Gearing. It should also be noted that from what is

known so far Action SA has the lowest equity and the lowest gearing (from assessed

companies) which might indicate that operations are financed by trade credit.


Short Term Gearing 25,48 44,66 50,40 40,18

Short Term Gearing Ratio presents bank credits and loans relation to equity. Based on

presented above table of Gearing Ratio results, it can be easily noticed that Action SA is the

only company among three assessed with any long term debt.


Net Debt/ EBITDA 0,48 1,52 2,62 1,54

Net Debt/ EBITDA Ratios in table above indicate that neither of assessed companies

has reached alarming level of indebtness. Action SA has the lowest result, which means that

there should be no problems handling current debt and financials costs.

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Interest Cover 15,81 6,84 4,23 8,96

Action SA can cover interest costs almost 16 times higher from its Operating Profit. It

is the highest result among three analysed companies.

2.3 Efficiency ratios


Debtor Days 45,04 36,04 33,56 38,21

Average result of Debtor Days is 38, among assessed companies Action SA is the only one

that has result over 45 days. Taking into consideration fact that payment terms can reach even

90 days it is still excellent result. Nevertheless, results of Debtor Days analysis in table above

indicate that on average it takes 45 days for Action SA to receive payments for delivered

supplies or services.


Creditor Days 59,20 30,99 33,64 41,28

Action SA has the longest Creditor Days among assessed companies. Results show

that Action SA pays to creditors after, on average, 59 days. This is almost twice as long as

two other competitors. Action SA suppliers should take into consideration fact this company

pays for deliveries on average after 59 days. Quite long Creditor Days indicate that, in fact,

Action SA is crediting its operations’ on suppliers’ expanse.

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Stock Days 30,30 26,00 31,74 29,34

Average Stock Days Ratio for three assessed companies shows that result recorded for

Action SA is acceptable and similar to average.


Credit Cycle 16,13 31,05 31,66 26,28

Action SA can manage their trade payables and receivables efficiently enough to

minimise Credit Cycle to only 16 days. It is possible thanks to longer Creditor days compared

with Debtor days and quite average Stock days.


Fixed-Asset Turnover 31,97 64,69 32,78 43,15

Fixed-Asset Turnover ratio is especially informative in case of production companies.

All assessed companies are mostly engaged in trading activities. Among those, ABC Data has

the highest ratio result, which actually indicates that group has recorded the highest sales

compared with employed fixed assets. For shareholders the highest is the ratio the better,

however for creditworthiness analysis productivity of fixed assets is not of greater

importance.

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2.4 Profitability ratios


Gross Margin 6,26 4,70 3,87 4,94

Action SA has recorded the highest Gross Margin Ratio among assessed companies.


Operating Profit 1,73 1,60 1,18 1,50

Result on operating profit level for Action SA is again the highest.


Net Profit 1,28 1,23 0,77 1,09

Net profit of Action SA was the highest among competition.


ROE 20,14 18,75 9,90 16,26

In terms of efficient using its equity Action SA recorded the highest result, noticeably

above average.


ROA 5,26 6,46 3,57 5,10

Action SA recorded second best result in terms of employed assets. It means that

ABC Data SA has the lowest Balance Sheet Total Amount compared to generated profit.

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2.5 Market Value ratios

Action SA 2010 2011 2012 2013

EPS 1,57 2,58 2,94 3,70

ABC Data SA 2010 2011 2012 2013

EPS 0,32 0,42 0,25 0,47

AB SA 2010 2011 2012 2013

EPS 2,16 3,23 2,95 2,57

Earnings Per Share Ratios above show that while Action SA and ABC Data SA has positive

trend, AB SA EPS is decreasing.

Action SA 2010 2011 2012 2013

Price/ Book Ratio 1,69 1,47 1,51 2,77

ABC Data SA 2010 2011 2012 2013

Price/ Book Ratio 3,33 1,21 1,06 1,97

AB SA 2010 2011 2012 2013

Price/ Book Ratio 1,31 1,45 1,03 0,95

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Again, Price/ Book Ratio shows positive trend in relation of shares’ price development

to its book value in case of Action SA and ABC Data. AB SA has been recording decreasing

trend since 2011.

Action SA 2010 2011 2012 2013

Enterprise Value /Total Sales

0,32 0,30 0,28 0,34

ABC Data SA 2010 2011 2012 2013


0,43 0,33 0,23 0,23

AB SA 2010 2011 2012 2013


0,26 0,26 0,23 0,20

Enterprise Value to Total Sales shows similar trend in case of ABC Data SA and AB

SA – minor decrease. Action SA has recorded slight increase in recent year.

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