+91-9519066910
Sydney NSW 2074, Australia

Assignment

Computing Skills Assignment Help

Matlab Assignment Help

Finance Structure Assignment Help

Rating:
Finance Structure Assignment Help

Finance Structure Assignment Help

Introduction:-

The financial structure of the company represents the company’s sources of fund. The company has to generate a positive financial growth to retain the current shareholders and debt holders and also to increase the market share of the firm.

Here, the Dillistone Group Plc is one of leading software company in the world established in the United Kingdom, has a potential in capturing the market. The company has a great quality product on the market. But if we consider their financial conditions it is not worthy of that. The company has a decreased EBIT and net income as a profitability of the company. This is not a better sign for the company and the investors will not invest in the company if they could not increase the profitability such as net income and EBIT. On the other, Dillistone has to maintain its debt and equity in the firm so that their interest and dividend payment remain in a constant procedure. Now the capital structure of the company is getting more debt base. The company has to prevent the dependency on the debt.

Dillistone Group Plc is one of the most popular software industries in the world which was founded in the United Kingdom. It is a global leader in the field of supply of technology solutions and services to the recruitment industry. Currently, the company is operating its business in more than 60 countries and working in 2,000 firms in the world. The company has three divisions for working in. Its three divisions are Dillistone Systems, Voyager Software, and Gated Talent. Dillistone system is the is division specializes in the supply of company and services into the executive level recruitment process. Voyager software division is specializing in the contingent recruitment like contractual placement, provision of temporary staffs and permanent placement. And the final division is Gated Talent which was established in 2017 to provide networking the information the executive recruitments in a GDPR compliant manner.

Background of the company

 For the Dillistone Group Plc, their main goal in for surviving in the market is by both organically and through acquisition. Also, the group has a focused customer based who are aware of the product quality of the company. So, the company is focusing on the products that can increase the market customers as well as the market shares. The firm has a principally implemented the group’s objective in the company to have a better customer in numbers, who are willing to buy new quality products. And to be the market leader in the software industry of the United Kingdom, through increasing the company’s capabilities by recruiting the talented employees who have the potential to prove their best worth for the company. Also, the company is implementing an aggressive dividend policy in terms of providing shareholders benefits against their share.

 Financial Analysis:-

As one of the leading companies in the United Kingdom market, the Dillistone Group Plc has been working to improve the company’s capabilities in maintaining the capital structure of both equity and debt base as they have to provide benefits to both the customers and shareholders and repay the debtholders liabilities. A company’s capital structure is the company’s sources of fund. The policy here describes the way of collecting fund form the sources of the company. The capital or the fund of the company can be financed through both the equity and debt. Equity is the fund financed by shareholders of the company. Shareholders buy the company share from the expectation of getting the dividend and the company's ownership. On the other hand, the debtholders provide the fund to the company for the purpose of getting the interested return from the company.

The company is maintaining its capital structure mainly by adjusting the number of dividends paid to the shareholders, return capital to shareholders, sell assets, issue new shares, or taking loans from the banks or other financial institutions who are capable of providing loans to the companies like Dillistone Group Plc. The company has structured its capital structure from both equity and debt as they take debt from the market to finance their organization. It is important for the company to invest fund from the outside of the company like the bank loan, it is beneficial for them in many ways that it reduces the cost of capital and when they include the interest expense in the income statement it provides benefits in tax benefit and lower the tax rate for the company as a result of less net income.

For every company’s surviving there should be an effective dividend policy that does not hamper the work of the company and also satisfy the shareholder’s needs. For the Dillistone Group Plc, the company should increase its profitability to increase the shareholders' dividend they have pay to the shareholders. The company management should keep that in mind that there should an effective dividend that should be injected into the company's benefits.

 

2015 (£ 000)

2016 (£ 000)

2017 (£ 000)

EBIT

1,108

412

-529

Net Income

1,212

526

71

 

 

 

 

Equity

7,159

6,906

6,294

Debt

158

-

386

Interest Paid

13

8

7

Dividend Paid

793

811

551

EBIT:- 

EBIT is the net income that generated before the adjustment of the company’s interest expense and taxes. EBIT can be calculated from both sales and net income. To calculate EBIT from sales the company have to deduct the operating expense from the sales. On the other hand, to calculate EBIT from net income, we have added the interests and taxes with the net income. EBIT is important for the company if they have any chances to sell the company or go for the merger or acquisition in the market where the tax and interest rates are different from the country they running the business.

EBIT

Here for the Dillistone Group Plc, their EBIT is £1,108; £412 and negative £529 (all are in £ 000) in the year of 2015, 2016 and 2017 respectively. The has failed to maintain their EBIT in the recent years, they were able to maintain a positive EBIT in the year of 2015 and 2016 but their EBIT went negative in the year 2017, which is a bad sign for the company’s future opportunities. Because of this, the company can face the opportunity for getting a higher price against the company’s ownership at the time of ownership transfers. The situation can also decrease the share price of the company. The share price of the company can be changed due to the company’s changes in the profit generation, earnings generation or the reputation of the company in the market. So, the company has to focus on their EBIT to increase its value.

Net Income:-


A company’s profitability is mainly measured by the amount of net income the company has been able to generate from its net income. Net income the annual profit that a company generated from its operating activities. It is the income that is available after deducting all the expenses of the company. Net income is calculated from the sales of the company. It is the income that available to the shareholders and will be provided them as the dividend.

 Net Income

Here, the Dillistone Group Plc has been able to generate the net income of £1,212; £526 and £71 (all are in £ 000) in the year of 2015, 2016 and 2017 respectively. The company has been able to generate the positive net income from their operations but their net income is decreasing over the time. It is not a suitable position for a company to generate a lower net income in the upcoming years. Based on the trendline represented in the graph, we can observe that the company has a reduced net income and can generate a negative net income in the future years. It is management’s responsibilities in maintaining the overall production and increasing productivity for the company. The amount of the net income of the company must be increased otherwise the company won’t be able to provide the dividend to the stockholders.

Equity:-

The most important sources of fund are the equity for a company. Equity is the amount of fund where the shareholders have their claim on. Shareholders are the owner of the company. Their claim on the company depends on the amount of their equity in the company. The company has to provide a dividend to the shareholders against the equity, otherwise, they are bound to switch the company. Here, the company has got more equity capital as a capital structure. It has the equity capital of £7,159; £6,906 and £6,294 (all are in £ 000) in the year of 2015, 2016 and 2017 respectively.

 Here, in the trendline, we can see that the company's equity is decreasing in numbers. This can be the result of the company’s bad impression as generating profits. As the company has not been able to generate more profit for the owners they (owners) are withdrawing their funds from the market and investing the fund in other company’s shares. In the future, the company may have to fund their capital structure if they could not generate the desired profit for the shareholders.

 

Conclusion:-

The company has been working the United Kingdom for a long period of time, but in recent financials of the company represents that the company is not doing well in the business as their both EBIT and Net income is not worth enough to represent in the market. On the other hand, instead of having a lower net income the company has been able to provide the shareholders their desired dividend. The management here, have to take the responsibilities of generating more profit for the company. Their main work here should be to implement the rules and regulations in generating the best work from the employees. Not only the work but also to ensure that the market has enough knowledge about the company and they know the potential of the firm. This can increase the capabilities of the company in generating more profit and increase the trustworthiness of investors.

 

Finance Assignment Help, Finance Planning Assignment Help, Financial Services Assignment Help, Capital Budgeting Assignment Help, Behavioral Finance Assignment Help, Financial Statement Analysis Assignment Help



 DOWNLOAD SAMPLE ANSWER

Details

  • Number of views:
    11
  • PRICE :
    AU$ 76.00
Security Code  
Urgent Assignment Help

Our Top Experts


Karen Betty

Holding a PhD degree in Finance, Dr. John Adams is experienced in assisting students who are in dire need...

55 - Completed Orders


Daphne Lip

Canada, Toronto I have acquired my degree from Campion College at the University of Regina Occuption/Desi...

52 - Completed Orders


Mr Roberto Tuzii

Even since I was a student in Italy I had a passion for languages, in fact I love teaching Italian, and I...

102 - Completed Orders


Harsh Gupta

To work with an organization where I can optimally utilize my knowledge and skills for meeting challenges...

109 - Completed Orders


ARNAB BANERJEE

JOB OBJECTIVE Seeking entry level assignments in Marketing & Business Development with an organization...

202 - Completed Orders


KARAN BHANDARI

Current work profile Project manager- The Researchers Hub (2nd Jan 2016 to presently working) Researc...

20 - Completed Orders


Tan Kumar Ali

Sales Assistant, Mito Marina Assigned to the Stationery dept – assisted in merchandising, stock taking...

100 - Completed Orders


Wesenu Irko

Personal Profile Dedicated and highly experienced private chauffeur. High energy, hardworking, punctua...

200 - Completed Orders


Lizzy Darley

I'm Lizzy, full time education specialist in English, Essay Writing, Economics and Maths. Having Assi...

109 - Completed Orders


CRYSTAL

HSC PREPARATION I specialise in English coaching programs for HSC students. My personalised and results-...

202 - Completed Orders