Executive Summary

The following group have been assigned a task of financial statement analysis on Topps Tiles
for the year 2008 to 2009 (2 years). It’s Britain’s major tile and wood flooring specialists
group with over 250 stores all over in the UK. Its offers an huge variety of wall and floor
tiles, natural stone, laminate and solid wood flooring and under floor heating and they also
deal with the tools, adhesives, grouts, accessories and cleaning products. The group has
submitted the report after a careful study of the annual reports of the company and its
competitor.

It is very important to make a note at this that financial statement analysis (ratio analysis)
which is done on the basis of the balance sheet, Income Statement is very crucial not only
from the investors point of view, but also from other entities like Investment Bank
commercial Institutions, Government and other regulatory authorities.

The detailed report is based on the Company’s Liquidity Position, Profitability Position,
Efficient use of Assets, gearing position and other relevant topics.

About Topps Tiles

Topps Tiles first specialist tile centre in 1963 they provide good quality products at value of
money. It’s Britain’s major tile and wood flooring specialists group with over 250 stores all
over in the UK. Its offers an huge variety of wall and floor tiles, natural stone, laminate and
solid wood flooring and under floor heating and they also deal with the tools, adhesives,
grouts, accessories and cleaning products. Company No. 1 priority is fulfilled the customer.
They also provide a variety of services contribution practical support. Company aims to make
a helpful position to local communities served by them. Being a ‘good neighbour’ is Topps’
main concern and initiatives include countrywide youth football sponsorship and work for the
charity, Help for Heroes, and support for medley art in schools and community groups
countrywide.

Profitability ratios 2008 2009

Gross profit ratio 61.77% 58.30%

Net profit ratio 16.64% 8.83%

Return on shareholder’s fund 50.3% 9.20%

Return on capital employed 22.33% 11.18%

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60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
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Sale Turnover 186061 208084

Year 2008 2009

Admin & Distribution Exp 8082 7039
Expenses/ Sale Ratio 45.13% 42.43%

Expenses/ Sale Ratio

45.50%
45.00%
44.50%
44.00%
43.50% Expenses/ Sale Ratio

43.00%
42.50%
42.00%
41.50%
41.00%
1 2
Liquidity Ratio 2008 2009
Current Ratio 1.08 1.14
Quick Ratio 0.99 0.99

Efficiency Ratios 2008 2009

Assets Turnover Ratio
Receivables Turnover Ratio
Inventory Turnover Ratio