Financial performance of agri-dynamics and livestock development corporation in Morong, Rizal

Thesis BSA University of Rizal System, Binangonan 2017

includes bibliographical references

This study primarily aimed to evaluate the Financial Performance of Agri- Dynamics and Livestock Development Corporation (ALDEC) in Morong, Rizal which is one of the longest running agribusinesses in Rizal. For the record, the corporation has been in operation for 27 Years since it was established in 1989. It has many employees that has been working for the firm for Years. The company is engaged in producing different variety of poultry products. The study used descriptive method and content analysis, to gather information about the past and present existing financial condition of the company. The researchers believed that it is the most appropriate method to examine the trends and patterns in terms of financial performance of the subject through data gathering and analyzing information which are related to the study. The financial statements of the company were gathered from the Securities and Exchange Commission and used as the primary source of data. Financial ratios were used to draw an overview about the financial performance of Agri-Dynamics and Livestock Development Corporation Financial specifically in terms of horizontal analysis, vertical analysis, profitability, liquidity, leverage and activity ratio. The study found that ALDEC showed favorable improvement in terms of profitability, liquidity, leverage and activity ratio in 2011-2013 and started declining in 2014-2015. This was due to the withdrawal of its major stockholders, increasing competition and unstable prices and other events that affect the fluctuation of prices in relation to the industry. In order for ALDEC to strengthen their assurance of its continuity of operation, the company must improve their operating income by diminishing its operating expenses, sales, and strategize how to increase its margin by considering price increase when the products are on higher demand. The company should set an overall price for the products to increase demand, which in turn boosts sales and inventory turnover, either establishing a temporary discount or set a more permanent lower price for the slow selling merchandises. In terms of its liquidity, the company is recommended to maximize the movement of their assets in the market. Monitor their accounts receivable effectively perhaps by sweeping accounts through financial institutions, this will allow them to earn interest on any excess cash balances by transferring the funds into an interest bearing account when the funds aren't needed and sweeping them back to their operating account when they need it. Manage their assets in order to achieve higher revenue than its liabilities and control debt levels. Effectively managing inventory, restructuring of debt by refinancing its existing debt at lower rates will reduce both interest expenses and monthly payments, improving the company's bottom line profitability and improve cash flow. In terms of activity ratio, it is suggested that the company should accelerate its receivable collections, increase sales, sell assets and improve efficiency in managing its total assets. The company should continuously increase the use of its assets, limit purchases of inventory and increase sales without purchasing new assets or they can lease their assets.