Presentation of Financial Analysis

THE BUSINESS AND FINANCIAL PERFORMANCE OF PANASONIC AND SONY

FOR PERIOD OF 1 APR 2008 TO 31 MAR 2011Than Aung ACCA Reg: No. 1915848

AGENDA

Introduction, Aim and Objectives of Research Introduction Reasons for choosing the project topic Aim of Research Project Research Approach

Information Gathering and Accounting/ Business techniques Information gathering Accounting and business techniques

Research and Analysis Financial Performance Analysis Sales Growth Analysis Business Performance Analysis Conclusion and Recommendation Limitation

Introduction, Aim and Objectives of ResearchReasons for choosing the project topic

Topic → Number (8)

Organizations → Panasonic and Sony

Background → Briefing note for corporate history

Introduction, Aim and Objectives of ResearchAim and Objective of Research Project

To maximize the effectiveness of use the firm’s invested fund

To understand adequacy of operating cash flows

To know the current position and composition of a firm’s resources

To distinguish between creditor and owner state against those resources

To evaluate changes in wealth and assets in over time

To maintain effective controlling and monitoring the business operation Finally, to provide the objective opinion for investment decision to existing

and potential investors

Introduction, Aim and Objectives of ResearchResearch Approach

Gathering and

collecting

data.

Classifying data

characteristics.

Processing and

transferring collected data into

useful information.

Identifying the

factors.

Calculating the ratios and

trends that we need to analysis.

Demonstrating

the compar

able results.

Looking the competitive advantages

.

Conclusion

Information Gathering & Business techniques Information gathering and sources of information

Annual report of Panasonic Corporation

Letter from Chairman and President to Shareholders

and Stakeholders

Annual report of Sony Corporation

Audit report of both companies

Financial review of each company

Student Account magazines Library/ Academic references and records

Financial News

Other websites

Information Gathering & Business techniques Accounting and business techniques

Financial and Accounting Ratios

Profit ability Ratios

Liquidity and Gearing Ratios

Cash Flow and Investor Investment Ratios

Business Techniques

Growth and Trend Analysis

PESTEL Analysis

SWOT Analysis

Research and Analysis Financial Performance Analysis : Profitability Trend

Panasonic Gross Proft

Panasonic Net Profit Sony Gross Proft Sony Net Profit

2009 2098.2 -403.843 2069.5 -102.214

2010 2076.9 -170.667 2321.4 12.954

2011 2303.5 85.597 2349.9 -220.326000000001

Research and AnalysisFinancial Performance Analysis : Asset Turnover

2009 2010 20110

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

2

Asset Ultilization

(Panasonic) (Sony)

Ass

et tu

rnov

er (

Tim

es)

Research and AnalysisFinancial Performance Analysis : Working Capital

2009

2010

2011

1,194.3

990.2

642.8

(190.3)

72.9

(282.9)

Working Capital (billion of ¥)

(Sony) (Panasonic)

Research and AnalysisFinancial Performance Analysis : Assets Compositions

9%

15%

46%

30%

Sony's Assets Composition

Property Plant and Equi Intengible assetsOther investment Currnet assets

24%

24%

7%

45%

Panasonic 's Assets Compositon

Property Plant and Equi Intengible assetsOther investment Currnet assets

Research and AnalysisFinancial Performance Analysis : Sample Tables for Ratios Calculation

Current RatioYear 2009 2010 2011Panasonic 1.60:1 1.35:1 1.23:1Sony 0.95:1 1.02:1 0.93:1

Quick Ratio

Year 2009 2010 2011

Panasonic 1.21:1 1.03:1 0.91:1

Sony 0.74:1 0.86:1 0.76:1

Panasonic

Year 2009 2010 2011

Inventory turnover 6.93 times 6.34 times 7.06 times

Inventory day 50 days 62 days 51 days

Inventory conversion cycle 86 days 120 days 95 days

Sony

Year 2009 2010 2011

Inventory turnover 6.17 times 6.71 times 7.16 times

Inventory day 52 days 48 days 53 days

Inventory conversion cycle 93 days 93 days 91 days

Panasonic

Year 2009 2010 2011

Trade receivable day 36 days 58 days 44 days

Trade payable day 44 days 73 days 57 days

Working capital cycle 42 days 47 days 38 days

Sony

Year 2009 2010 2011

Trade receivable day 40 days 45 days 38 days

Trade payable day 36 days 61 days 60 days

Working capital cycle 57 days 32 days 31 days

Research and AnalysisFinancial Performance Analysis : Debt (Long term) to Debt (Long term) plus Equity for 2009 – 2011

2009 2010 20110.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

PanasonicSony

Research and AnalysisFinancial Performance Analysis : Total Debt to Total Equity (2011)

Equity,64.9%

Short term debt; 9.5%

Long term debt;

25.6%Equity,75.

1%Short term debt; 4.2%

Long term debt; 20.8%

Research and AnalysisFinancial Performance Analysis : Debt (Long term) to Equity for 2009 – 2011

2009 2010 20110.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

PanasonicSony

2008 2009 2010 2011

1

0.754667486032838

0.864415570870123

0.692123631267371

1

0.859608577159758 0.878035659596720.784774894720329

Changes in Owner's Equity (Parent + NCI)

Panasonic Sony

Research and AnalysisFinancial Performance Analysis : Changes in Owner’s Equity

Research and AnalysisFinancial Performance Analysis : Changes in Owner’s Equity

2009 2010 2011

-0.245332513967163

0.145425749576435

-0.199316099118071

-0.14039142284025

0.0214365967564529

-0.106215236086446

Changes in Owner's Equity (Parent + NCI)

Panasonic Sony

Research and AnalysisSales Growth Analysis : Growth Rate Movement

2009 2010 2011

-14%

-4%

17%

-13%

-7%

-1%

Sale growth rate movement year by year (Anchoring)

Panasonic Sony

Research and AnalysisSales Growth Analysis : Seasonal Sales Trend

1st q

uarte

r

2nd

quar

ter

3rd

quar

ter

4th

quar

ter

1st q

uarte

r

2nd

quar

ter

3rd

quar

ter

4th

quar

ter

1st q

uarte

r

2nd

quar

ter

3rd

quar

ter

4th

quar

ter

2009 2010 2011

0.0

500.0

1,000.0

1,500.0

2,000.0

2,500.0

Seasonal sales trend

Panasonic Sony

(Bill

ion

of y

en)

Research and AnalysisSales Growth Analysis : Geographical sales (International operation)

Domestic sales (Japan)

53%

United

States

13%

Europe12%

Asia-Pa-cific11%

Other Areas11%

Panasonic (2009)

Domestic sales (Japan)

54%

United

States

12%

Europe10%

Asia-Pa-cific11%

Other Areas12%

Panasonic (2010)

Domestic sales (Japan)

52%

United

States

12%

Europe10%

Asia-Pa-cific12%

Other Ar-eas14%

Panasonic (2011)

Domes-tic sales (Japan)

30%

United States20%

Europe21%

Asia-Pacific18%

Other Areas11%

Sony (2011)

Domestic sales

(Japan)30%

United States20%

Europe21%

Asia-Pacific18%

Other Areas11%

Sony (2011)

Domestic sales

(Japan)24%

United States24%

Europe26%

Asia-Pacific17%

Other Areas10%

Sony (2009)

Research and AnalysisBusiness Performance Analysis

Business Strategies

PESTEL Analysis

SWOT Analysis

Research and AnalysisConclusion and Recommendation

Panasonic has created sustainable business plans, achieving sales growth, EPS, dividend cover are also attractive for investors.

Capital structures changing and new loan acquired are effective. Investment in NCA is also well-built. Own products and continuous innovation. Good corporate image and robust commitment of Management and its subordinates.

Current technology is feasible for future goals and the investor’s judgment for decision making is also supported by financial

reporting information.

Panasonic is a good growing company for existing and potential investors.

Research and AnalysisLimitations

Amount of time available

Constraints of data collection.

Some inherent limitations of

Financial ratios

Reports of Chairman and

President

Thank you for attention