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25855205 (1).pdf - 2nd International Conference on Economy,...

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Financial Analysis Report of Easyjet Airline Co., Ltd vs. US AirwaysGroupYuan ZhangXijing University, Xi'an Shaanxi, 710123, ChinaKeywords:Financial strategy analysis, Financial profitability analysis, Financial statements,Corporate performance.Abstract.Nowadays accompanying with economic globalization and the development ofinformation technology, it becomes increasing critical on financial analysis to the multinationalcompanies listed. The efficient capital markets provide probabilities to the financial analysis on bothfinancial and non-financial information of companies themselves and their competitors. Financialstatements are an important source of information for analyzing corporate performance by whateverinside analysts or outside stakeholders. Meanwhile by comparing related information between thecompany and its competitors, it drives the company to operate better in practice..IntroductionIn this financial analysis report, it focuses on an airline company listed in the UK with the name ofEasyjet Airline Co., Ltd (Easyjet airline) because it is worldwide welcome for the low-cost air travel,it is a typical targeted company for our analysis based on an UK company listed and its sales revenuestably increase in the past five years. At the same time, it selectes a similar industry company namedUS Airways Group (US airways) for the purpose of comparing in some cases. Which conducts ouranalysis on three stages, firstly, reviewing business strategies of both companies, which includescorrespond core competencies, industry background as well as their strategic issues implied.Andthen it takes accounting analysis to assess the quality of financial information of both companies.Finally, it analyses profitability using the decomposition framework of key financial ratios.Theoverall financial analysis relies on the information of the past five-year time horizon from 2007 to2011 (spotlighted in recent 2 years), whatever financial information or non-financial informationimplied in this report.Strategic reviewEasyjet airline is one of the few pan-European low-cost carriers in the European, and it is becomingpopular in the world. Observing the strategic of Easyjet airline, it includes several aspects, as it wouldlike to be the leading of the Europe’s preferred short-haul airline company, so in order to reach thistarget, its core competencies are going to make air-travel easy and affordable, to deliverpoint-to-point low fares with operational efficiency and friendly service for customers, to use lowcost product enablers and so forth. Thus, the aim of this company is to generate the safely, passional,and simply travel agency in the world. In accordance with the annual report and accounts 2011,Carolyn McCall, Easyjet airline CEO, said that owing to the staffs’ hard working, Easyjet airline hasdelicate financial performance through the years, and also it claimed that Easyjet airline has robustoperations which mean that the strong operational performance drives the customer’s satisfaction.

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Term
Fall
Professor
NoProfessor
Tags
Balance Sheet, Generally Accepted Accounting Principles, ROCE, Easyjets

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