Financial Analysis of Lego Company

Yaoyao Guo

Bachelor's thesis

Abstract:

Financial analysis has become an important management activity of enterprises. Reasonable and effective financial analysis methods can help managers to more truly understand the solvency, operating capacity, profitability and cash flow status of enterprises. Enterprise managers reveal and evaluate the financial status of enterprises through reasonable financial analysis. This enables managers to understand the current situation and risks of enterprises, and then urge enterprises to make adjustments to achieve greater returns. This thesis takes Lego Company as an example to analyze its financial situation from 2013 to 2017. This thesis first expounds the reasons for the research, and then puts forward the research methods of this paper.In the main body of the article, the concept, function and calculation method of financial analysis method are introduced. It includes the concepts and calculation of financial statements, common-size analysis (vertical common-size method and horizontal common-size method) and financial ratio analysis methods. These theoretical knowledge lay the foundation for the financial analysis of Lego from 2013 to 2017. Next, the thesis introduces Lego's financial characteristics. According to Lego's financial report from 2013 to 2017, this paper analyses in detail how to use common analysis methods to analyze various financial statements. The financial ratio analysis method and DuPont analysis system are used to analyze and classify the financial statements. The solvency, operation ability, profitability and development ability of Lego Company are analyzed. Through the analysis, the author draws his own conclusions and puts forward some suggestions for the healthy development of the company. Some reasonable suggestions are put forward to improve Lego's short-term and long-term solvency, account receivable turnover and inventory turnover, cost and profit margin, and development ability to promote the healthy and sustainable development of the company.

Abstract:

Financial analysis has become an important management activity of enterprises. Reasonable and effective financial analysis methods can help managers to more truly understand the solvency, operating capacity, profitability and cash flow status of enterprises. Enterprise managers reveal and evaluate the financial status of enterprises through reasonable financial analysis. This enables managers to understand the current situation and risks of enterprises, and then urge enterprises to make adjustments to achieve greater returns. This thesis takes Lego Company as an example to analyze its financial situation from 2013 to 2017. This thesis first expounds the reasons for the research, and then puts forward the research methods of this paper.In the main body of the article, the concept, function and calculation method of financial analysis method are introduced. It includes the concepts and calculation of financial statements, common-size analysis (vertical common-size method and horizontal common-size method) and financial ratio analysis methods. These theoretical knowledge lay the foundation for the financial analysis of Lego from 2013 to 2017. Next, the thesis introduces Lego's financial characteristics. According to Lego's financial report from 2013 to 2017, this paper analyses in detail how to use common analysis methods to analyze various financial statements. The financial ratio analysis method and DuPont analysis system are used to analyze and classify the financial statements. The solvency, operation ability, profitability and development ability of Lego Company are analyzed. Through the analysis, the author draws his own conclusions and puts forward some suggestions for the healthy development of the company. Some reasonable suggestions are put forward to improve Lego's short-term and long-term solvency, account receivable turnover and inventory turnover, cost and profit margin, and development ability to promote the healthy and sustainable development of the company.

Keywords

Financial statements, Financial analysis, Common-size analysis, Financial ratios analysis, Financial index

Keywords

Financial statements, Financial analysis, Common-size analysis, Financial ratios analysis, Financial index

Language used: English

Date on which the thesis was submitted / produced: 10. 5. 2019

Thesis defence

• Date of defence: 1. 10. 2021
• Supervisor: Josef Novotný
• Reader: Miroslav Čulík

VSB – Technical University of Ostrava

Ekonomická fakulta

Bachelor programme / field:
Hospodářská politika a správa / Finance