The review of Net Profit Margin witnessed a mixed trend. The Net Profit Margin improved from 9.9% in 2019 to 13.81% in 2023.
The average EBIT Margin for the period under analysis was 1.69% with 2019 and 2022 performing the worst and best,
In the current year, Paccar Interest Cover was 1.08 times – compared to 2019 when it was 1.3 times
The Asset Turnover stood at 0.9 times in 2023 from 0.9 in 2019, implying a poor performance or Assets of the business in relation to revenue.
Profitability
The revenue of Paccar has shown a mixed trend year on year. The revenue decreased by 28.88 between 2019 and 2020 and a further 27.28% increase was recorded between 2020 and 2021. There also occurred an increase of 21.97% between 2022 and 2023 (the current period).
Paccar’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 good, as current ratio/acid test increase from 1.33:1/1.14:1 to 1.57:1/1.28:1 on the last year. Which implies that the company does not have enough assets to settle its current liabilities.
Capital Structure
Paccar 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 low as it stood at 1.57 in the current year.
