Financial Analysis of Selected Companies from the Watchmaking Industry and the Role of Inventories

David Strnad

Bachelor's thesis

Anotácia:

In this thesis, the elementary methods of financial analysis are applied to selected companies from the Swiss watchmaking industry, and the influence of inventories is examined. As the companies in question have been selected The Swatch Group Ltd and Compagnie Financière Richemont SA due to the similar market share as of 2019 and place of origin of their watches. The financial analysis revealed a more aggressive approach of Richemont towards debt compared to Swatch Group with its minimal involvement of debt connected with interest. The analysis further uncovered low performance of Swatch Group’s assets due to significantly higher value of inventories, for which bullwhip effect offers possible explanation, together with the broader spectrum of products within brands of Swatch Group. Based on the available data, the results of the upcoming fiscal year of both companies are estimated.

Abstract:

In this thesis, the elementary methods of financial analysis are applied to selected companies from the Swiss watchmaking industry, and the influence of inventories is examined. As the companies in question have been selected The Swatch Group Ltd and Compagnie Financière Richemont SA due to the similar market share as of 2019 and place of origin of their watches. The financial analysis revealed a more aggressive approach of Richemont towards debt compared to Swatch Group with its minimal involvement of debt connected with interest. The analysis further uncovered low performance of Swatch Group’s assets due to significantly higher value of inventories, for which bullwhip effect offers possible explanation, together with the broader spectrum of products within brands of Swatch Group. Based on the available data, the results of the upcoming fiscal year of both companies are estimated.

Kľúčové slová

Financial analysis, Watchmaking industry, Ratio analysis, Vertical analysis, Horizontal analysis, Inventories, The Swatch Group Ltd, Compagnie Financière Richemont SA

Keywords

Financial analysis, Watchmaking industry, Ratio analysis, Vertical analysis, Horizontal analysis, Inventories, The Swatch Group Ltd, Compagnie Financière Richemont SA

Jazyk práce: English

Datum vytvoření / odevzdání či podání práce: 5. 1. 2021

Obhajoba závěrečné práce

• Obhajoba proběhla 11. 2. 2021
• Vedúci: doc. Ing. Romana Čižinská, Ph.D.
• Oponent: Josef Horák, Ph.D.

ŠKODA AUTO a.s.

ŠKODA AUTO VYSOKÁ ŠKOLA o.p.s.

Bachelor programme / odbor:
Economics and Management / Business Administration and Operations, Logistics and Quality Management