Question

Please also find financial statement yourself

COMPANY NAME: EMIRATE AIRLINE

1. Brief introduction about the company

2. Why is the financial analysis important for this company?

3. Present the balance sheet and income statement for the last 2 available consecutive years (2016 and 2017) for your company

4. Preset the balance sheet and income statement for the last available year for 2 competitors (choose the top competitors)

5. Perform a ratio analysis covering all 5 groups of ratios:

a.Short-term solvency, or Liquidity Ratios

b. Long Term Solvency, Or Financial Levarage

c. Profitability Ratios

d. Market Ratios

e. Assets Utilization or Turnover Ratios

6. Trend analysis: Compare the ratios over 2 years for your company to depict trends

7. Comparable analysis: Compare the ratios of 2017 for your company with the same ratios for 2017 for the 2 competitors

8. In light of the above analysis, provide recommendations to the upper management to improve your company’s financial performance

Answer 1

1. Introduction about Company

Emirates is the world's fourth largest airline by scheduled revenue passenger-kilometers flown, the fourth-largestin terms of international passengers carried, and the second-largest in terms of freight tonne kilometers flown. From March 2016 to February 2017 Emirates had the longest non-stop commercial flight from Dubai to Auckland.

During the mid-1980s, Gulf Air began to cut back its services to Dubai. As a result, Emirates was conceived in March 1985 with backing from Dubai's royal family, with Pakistan International Airlines providing two of the airline's first aircraft on wet-lease. With $10 million in start-up capital it was required to operate independently of government subsidy. Pakistan International Airlines provided training facilities to Emirates' cabin crew in its academy. The airline was headed by Ahmed bin Saeed Al Maktoum, the airline's present chairman. In the years following its founding, the airline expanded both its fleet and its destinations. In October 2008, Emirates moved all operations at Dubai International Airport to Terminal 3.

Emirates operates a mixed fleet of Airbus and Boeing wide-body aircraft and is one of the few airlines to operate an all-wide-body aircraft fleet (with the exception of Emirates Executive). As of November 2017, Emirates is the largest Airbus A380 operator with 103 aircraft in service and a further 42 on order. Since its introduction, the Airbus A380 has become an integral part of the Emirates fleet, especially on long-haul high-traffic routes. Emirates is also the world's largest Boeing 777 operator with 151 of these aircraft in service.

2.

Financial analysis is an aspect of the overall business finance function that involves examining historical data to gain information about the current and future financial health of a company. Financial analysis can be applied in a wide variety of situations to give business managers the information they need to make critical decisions. The ability to understand financial data is essential for any business manager. Finance is the language of business. Business goals and objectives are set in financial terms and their outcomes are measured in financial terms. Among the skills required to understand and manage a business is fluency in the language of finance—the ability to read and understand financial data as well as present information in the form of financial reports.

The finance function in business involves evaluating economic trends, setting financial policy, and creating long-range plans for business activities. It also involves applying a system of internal controls for the handling of cash, the recognition of sales, the disbursement of expenses, the valuation of inventory, and the approval of capital expenditures. In addition, the finance function reports on these internal control systems through the preparation of financial statements, such as income statements, balance sheets, and cash flow statements.

Finally, finance involves analyzing the data contained in financial statements in order to provide valuable information for management decisions. In this way, financial analysis is only one part of the overall function of finance, but it is a very important one. A company's accounts and statements contain a great deal of information. Discovering the full meaning contained in the statements is at the heart of financial analysis. Understanding how accounts relate to one another is part of financial analysis. Another part of financial analysis involves using the numerical data contained in company statements to uncover patterns of activity that may not be apparent on the surface.