The review of Net Profit Margin witnessed a mixed trend. The Net Profit Margin declined from 9.8% in 2019 to 9.7% in 2023.
The average EBIT Margin for the period under analysis was 13.28%, with 2020 and 2023 performing the worst and best, respectively.
In the current year, Eastman was able to cover its interest liabilities 6.06 times in the current year- compared to 2019 when it was 5.14 times.
The Asset turnover stood at 0.63 times in 2023 from 0.58 in 2019, implying a high performance on Assets of the business in relation to revenue.
Profitability
The revenue of Eastman has fluctuated year on year. The revenue DEcreased by 8.63% between 2019 and 2020 and a further 23.64% increase was recorded between 2020 and 2021. There also occurred a decrease of 12.95% between 2022 and 2023 (the current period).
Eastman’s performance in profitability looks good as the return on capital employed also recorded a good performance during the period of analysis.
Liquidity
The company’s result in liquidity looks poor, as the current ratio decreased from 1.86:1 to 1.35:1 on the last year. Which implies that the company does not have enough assets to settle its current liabilities.
Capital Structure
Eastman is both equity and debt financed.
The debt-to-equity (D/E) ratio has been increasing year on year. The gearing position of the company appears to be high as it stood at 165% in the current year.
