Financial statement analysis company KIDO corporation

machinery and agrochemicals, food processing, labeling and packaging, storage, and distribution, regulatory frameworks, finance, marketing, retailing, catering, and research and developm

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Financial statement analysis

Company: KIDO Corporation

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II ANALYSIS OF FINANCIAL STATEMENT: 5

1 Sources and uses of cash analysis 5

a In 2019 – 2020 period 5

b In 2020 – 2021 period 6

2 Standardized balance sheets: 7

3 Standardized income statements: 9

4 Financial ratios analysis: 12

a Liquidity ratios: 12

b Financial leverage ratios: 13

c Turnover ratios: 14

d Profitability ratios: 15

e Market value ratios: 16

5 Dupont analysis 17

III CONCLUSION 18

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Table of Figures

Figure 1: Sources and uses of cash in 2019 - 2020 6

Figure 2: Sources and uses of cash in 2020 - 2021 7

Figure 3: Common-size balance sheet in 2019 - 2021 (Assets) 8

Figure 4: Common-size balance sheet 2019 - 2021 (Liabilities & Equity) 9

Figure 5: Kido Group's 2019 common-size income statement 10

Figure 8: Liquidity ratios in 3 years and Ind 13

Figure 9: Financial leverage ratio 14

Figure 10: Turnover ratio from 2019 to 2021 and Ind 15

Figure 11: Profitability ratio from 2019 - 2021 and Ind 16

Figure 12: Market value ratio in 2019 - 2021 and Ind 17

Figure 13: Dupont equation in 2019 - 2021 and Ind 18

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One of the factors that helps the business reach its objectives is financial activity Poor financial performance will hold back the rest of the department, preventing the organization from accomplishing its goals The expansion of an enterprise's commercial activity is therefore dependent on solid financial management To assess whether a company's financial performance is robust or bad, financial analysis is crucial Through financial analysis, the company's financial state will be revealed, and from there, corrective action will be implemented

My understanding of Kido Group's financial situation has improved as a result of

my research, which also allowed me to identify the sources and extent of the issues affecting Kido Group's finances Using such data, comment, assess, and suggest some improvements to the company's operations.

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I INTRODUCTION:

Company’s background:

KIDO Corporation was established in 1993 and has become one of the leading Food & Flavor companies in Vietnam In its 22-year history, KIDO Group has remained the market leader in confectionary across a wide array of products such

as confectionery, cookies and ice - cream under the KIDO brand name

In 2015, aiming to expand and develop into essential food, KIDO Group was officially established By promoting existing platforms, KIDO continues to maintain and develop its leading position in the frozen industry with Ice-Cream, Milk & Dairy products and expands its product portfolio to the food and beverage industry mainly with cooking oil, instant noodles, seasoning seeds, sauces, coffee, convenient packaged foods to take care of Vietnamese family kitchens and meet customers’ needs throughout the day

Currently, KIDO is leading the ice cream market with 43.5% market share (According to Euromonitor) and over 30% market share in cooking oil (According

to internal data).

All the staff at KIDO share a common mission and goal – to “Flavor your life” – and to become the leading foodstuff group in Vietnam and the Southeast Asia region Aiming to gain an immediate foothold in the foodstuff and spice markets,

as well as to meet consumer requirements, KIDO has invested continuously in factories and on research into new products The group has also signed Mergers & Acquisitions and strategic partnerships in a bid to expand its operations Whenever

a new product is launched onto the market or a partnership is signed, it marks a step forward in KIDO's development, brings the KIDO brand and essential food products closer to Vietnamese consumers.

The food product industry:

The vast majority of the food consumed by the world's population is produced through an extensive network of farmers and businesses that make up the food industry The entire spectrum of food production and distribution is included in the food industry Agriculture and animal husbandry, the manufacture of farm

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machinery and agrochemicals, food processing, labeling and packaging, storage, and distribution, regulatory frameworks, finance, marketing, retailing, catering, and research and development are all included.

According to the company's total market share of the entire industry, which ranges from 29% to 30%, KIDO will continue to occupy the No 2 spot in Vietnam's entire industry in 2020 and 2021 KIDO Group Joint Stock Company (KIDO) still reached KIDO's net sales of VND 10,497 billion in 2021 despite the Covid-19 pandemic's effects, an increase of 26.1% over the same period in the previous year.

In comparison to 2020, KIDO's after-tax profit increased by 97.3% to VND 653 billion The company's overall industry market share ranges from 30% to 32%, demonstrating that KIDO's market share is still growing year after year.

II ANALYSIS OF FINANCIAL STATEMENT:

1 Sources and uses of cash analysis

a In 2019 – 2020 period

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Figure 1: Sources and uses of cash in 2019 - 2020

Figure 1 shows us sources and uses of cash and its changes in total assets and total liabilities and equity of Kido Group in the period of 2019 – 2020 Overall, it is crystal clear that the total assets and the total liabilities and equity of 2019 have an increased compared to that of 2020

The total assets of Kido Group have increased by nearly 5 thousand billion dong from 2019 to 2020 In more detail, there was an significant increase in cash, inventory, other current assets and other non-current assets by about 577, 303, 80 and 30 billion dong, respectively, which contribute to the total uses of cash However, the decrease in account receivables and net FA also made a contribution

to the total uses of cash Although the current account receivables and the term receivables reduced slightly by about 400 billion dong, Kido Group still spent

long-a lot on long-account receivlong-ables (long-approximlong-ately 2328 billion)

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Moreover, increase in A/P (244 billion dong), N/P (12 billion dong) and other CL (863 billion dong) also contribute to the sources of cash At the same time, LT debt and C/S decreased, contribute to the uses of cash, but C/S was still spent approximately 7699 billion dong

b In 2020 – 2021 period

Figure 2: Sources and uses of cash in 2020 - 2021

Figure 2 also illustrates the sources and uses of cash as well as the changes in Kido’s assets and liabilities and owner’s equity in the 2020 – 2021 period In general, it is clear that there is a significant grow in the total assets and total liabilities and equity in 2021 compared to that of 2020

In particular, the total assets grew remarkably from about 12,349 billion to 14,072 billion in the period between 2020 and 2021, which increase by nearly 1,800 billion in 2 years In this period, it is witnessed that there were remarkable increase

in A/P (212 billion dong), N/P (381 billion dong), other CL (997 billion dong) and

LT debt (936 billion dong), which played an important role in increasing the sources of cash Moreover, there were decreases in other current assets (150 billion dong), Net FA (135 billion dong), which also contribute to the sources of cash Besides, cash, account receivables (both long-term and short-term), inventory and other non-current assets all experienced slight increase in during this time period,

by about 179, 231, 1283, 316 billion donng, respectively These increases made a significant impact on the uses of cash Moreover, reduced common stock value (by 804 billion dong) was one of the uses of cash

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 General comment:

On the whole, the total assets and total liabilities and equity of Kido Group grew steadily in from 2019 (11,932 billion) to 2021 (14,072 billion), resulting a shift of about 2,140 billion dong Moreover, the sources of money and the uses of money

in the period 2020-2021 are more than 1,000 billion higher than the period

2019-2020 In which, in the period of 2020-2021, due to the Covid-19, the company was experiencing expenses and debts as well as increasing storage of goods in order to keep firm running and compete with other rivals in the industry As a result, the increases in long-term debts and inventory had led to the more cash use

2 Standardized balance sheets:

Figure 3: Common-size balance sheet in 2019 - 2021 (Assets)

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Figure 4: Common-size balance sheet 2019 - 2021 (Liabilities & Equity)

From Figure 3 and Figure 4, from 2019 to 2021, the assets and liabilities and equity makeup altered, and each item is calculated as a percentage of the total assets Overall, it is witnessed remarkable changes in the percentage of cash, inventories, net FA and other assets (both current and non-current) which led to changes in total current and non-current assets

Cash and cash equivalent increased notably from 2019 (4,40%) to 2020 (8,92%), then grew slightly to 9,10% in 2021 This is related to Kinh Do reducing the proportion of investment in short-term and long-term assets, instead choosing to store cash and cash equivalents In which, the ratio of other current assets increased slightly by 0.44% in 2020, but decreased by 1.90% in 2021 Besides, the ratio of other non-current assets also decreased steadily from 2019 to 2021, from 34 42% down to 31.65% Reducing the ratio of short-term assets also shows that enterprises reduce the scale of production.

The proportion of short-term receivables in total assets from 2019 to 2021 is somewhat positive because it continuously decreased from 22.83% to 18.14% This proves that the company has quite good control over debt management and has effective trade credit policies during this period

Inventory accounts for a large proportion of total assets The inventory ratio increased slightly in 2019-2020, from 7.61% to 9.81% However, from 2020 to

2021, the inventory ratio nearly doubled, to 17.73%, although most of Kinh Do's products are seasonal and have a short shelf life This shows that the company is not really using capital effectively In addition, the increase in inventory ratio is

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also due to the impact of Covid-19, causing the demand for goods to decrease and increase the inventory of Kinh Do.

The proportion of net fixed assets gradually decreased over the years, decreasing from 23.90% (2019) to 21.67% (2020) and 18.06% (2021)

Account payables increased from 2019 to 2020 by 1.86%, but it rose by 0.86% in the period of 2020-2021 Note payables grew 2.13% throughout the 3 years Long- term debt ratio accounted for a fairly high ratio in 2021 Although in 2019-2020, the debt ratio decreased slightly from 9.15% to 6.84%, but increased sharply in

2021 with 12.65% C/S from 68.35% in 2019 to 48.99% in 2021 The proportion

of liabilities tends to increase over the years but is still under control, showing that the company is having smart business policies .

3 Standardized income statements:

Figure 5: Kido Group's 2019 common-size income statement

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Tiêu đề	Financial Statement Analysis Company: KIDO Corporation
Tác giả	Phạm Khánh Vy
Người hướng dẫn	Dr. Trần Tất Thành
Trường học	Not Available
Chuyên ngành	Not Available
Thể loại	Not Available
Năm xuất bản	Not Available
Thành phố	Not Available

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