Kegllogs

Key Performance Metrics

  • The review of Net Profit Margin witnessed a surging trend. The Net Profit Margin improved from 9.76% in 2017 to 10.54% in 2021.
  • The average EBIT Margin for the period under analysis was 20%, with 2019 and 2020 performing the worst and best, respectively.
  • In the current year, Kellogg’s was able to cover its interest liabilities 7.9 times in the current year- compared to 2017 when it was 5.4 times.
  • The Asset turnover stood at 0.78 times in 2021 from 0.79 in 2017, implying a low performance on Assets of the business in relation to revenue.

Profitability

  • The revenue of Kellogg’s has increased year on year. The revenue increased by 5.4% between 2017 and 2018 and a further 0.2% increase was recorded between 2018 and 2019. There also occurred an increase of 3% between 2020 and 2021 (the current period). 
  • Kellogg’s performance in profitability looks good as the return on capital employed also recorded good performance during the period of analysis.

Liquidity

  • The company’s result in liquidity looks poor, as current ratio/acid test decreased from 0.66:1/0.42:1 to 0.64:1/0.38:1 on the last year. Which implies that the company does not have enough assets to settle its current liabilities.

Capital Structure

  • Kellogg’s is both equity and debt financed.
  • The debt-to-equity (D/E) ratio has been falling year on year. The gearing position of the company appears to be lhigh as it stood at 331% in the current year.

Source: Kellogg’s Annual Report

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