Amna ilyas l1s18bsaf0022

Rooha Tahir l1f17bsaf0078

Financial analysis
Final project
Submitted to Sir aamir ali
NESTLE INTRODUCTION
Nestlé's was started in 1860 once 2 distinct Swiss companies established that would later figured Nestle.
In the next many years, the 2 opposing companies extended their organizations all through Europe and
the United States. In 1866, Charles Page and George Page, siblings from USA, set up the Anglo-Swiss
Condensed Milk Company in Switzerland. The organization's first British activity was opened in Wiltshire
in 1873.In 1867 in Switzerland, Henri Nestlé formed milk based kid food and started promoting it. The
next year, Daniel Peter started 7 years of work idealizing the milk chocolate developing method. Nestle
was the plan Peter expected to fix his worry of eliminating all the water from the milk added to his
chocolate, in this way keeping the item from creating buildup. Henri Nestlé resigned in 1875 however
the organization, under new proprietorship booked another name. In 1877, Anglo-Swiss added milk-
based child diets to its items. In the next year, the Nestle Company added thick milk to its collection,
which made the organizations direct opponents. In 1904, Henri Nestle and his three other partners took
an interest in the creation and advancement of Swiss chocolate, advertising the primary chocolate milk
Nestle. In 1905, the organizations joined to become the Nestle and Condensed Milk Company. The
organization's present name was adopted in 1977. In starting 1900’s, the organization was operating
plants in the US, UK, Germany, and Spain. The First World War encouraged importance for dairy items as
federal contracts, and, before the finish of the war, Nestlé’s creation had dramatically increased. In
January 1919, Nestle purchased 2 condensed milk plants. They extended them remarkably, handling
2.5lacs pounds of condensed milk every day in the Bandon plant. After the battle, federal contracts
faded, and buyers swapped back to new milk. Though, Nestle administration reacted fast, flattening out
activities and repaying off arrears. The 1920’s viewed Nestle initial venture into new items, with
chocolate-fabricate turning into the organization's second most vital action. Nestle sensed the impacts
of the Second World War right away. Remunerations dropped from $20M 1938 to $6 million in 1939.
Factories were set up in growing nations, especially in South America. Luckily, the war assisted with the
presentation of the organizations recent item, Nescafe, which turned into a basic beverage of the United
States army. The finish of World War II was the start of a productive stage for Nestle. Development
quickened and various organizations were procured. In 1947 Nestle joined with Maggi, a producer of
tastes and soups. Diversification went under Chairman and CEO with a shares in L’Oreal in 1974.During
the 1980s, Nestlé's developed main concern permitted the organization to dispatch further acquisitions.
Carnation was obtained for $3 billion of every 1984 and brought the vanished milk brand, just as Coffee-
Mate and Friskies to Nestle. In 1986, the organization established Nestle. The primary portion of the
1990 end up being great for Nestle. Exchange difficulties broken, and world business sectors formed into
incorporated exchanging regions. Since 1996, there have been different achievements. There were two
significant achievements in North America together in 2002. Nestle joined its United States ice cream
business. In a similar time period, Nestle arrived in a joint offer with Cadbury and verged on buying the
American organization Hershey's, one of its powerful company. December 2005 Nestle purchased the
Greek organization Delta Ice Cream for €240 million. In January 2006, it hold all responsibility for next
turning into the world's biggest ice cream creator, with a 17.5% market share. In July 2007, finishing an
arrangement reported the prior year. In April 2007, getting back to its underlying foundations. Nestle
got United States child food producer. In December 2007, Nestle went into an essential organization
with a chocolate maker. Nestle consented to offer its controlling stake. The deal was to shape part of a
more extensive United States $39.3 billion offered for full procurement of the world's biggest eye care
organization.

MISSION STATEMENT OF NESTLE

The world's leading nutrition, wellbeing and health organization. Our central goal of "Good Food, Good
Life" is to give buyers the best tasting, most nutritious choices in a wide extent of food and reward
classes and eating occasions, from morning to night.

VISION STYATEMENT OF NESTLE:

To be a main, serious, Nutrition, Health and Wellness Company conveying improved investor esteem by
being a favored corporate resident, favored manager, favored provider selling favored items.

Results OF NESTLE:

• Water

• Juices, Fruit Drinks

• Everyday milk pack

• Cereals

• Kit Kat

• Milo

• Cerelac

• Polo

• Milk Pak (dairy cream)

Settle OBJECTIVES:

• To accomplish similarity with global willful norms on natural administration frameworks.

• To assemble shared trust with customers, legislative specialists and colleagues.

• To guarantee ceaseless improvement of settles natural execution.

• Conservation of regular assets and minimization of waste.

• To build up the benchmark for good business practice.

DATA SOURCE:
We are getting data from Annual Reports of nestle and different websites but 75% data is taken from
Annual Reports.

QUANTITATIVE RESEARCH:
• This involves it includes relatively less persons such as professional markets researchers can take
interviews of thousands of people through post or telephone.

.Nestle routinely utilizes the two types of exploration to acquire an away from of buyer assessments and
patterns.

• Using these customers profile techniques, Nestle developed its different project strategies to
target the customers.

UNILEVER INTRODUCTION
Our motivation in Unilever is to meet the ordinary necessities of individuals wherever foresee the
desires of our purchasers and clients and to react innovatively and seriously with marked items and
administrations which raise the personal satisfaction. Our profound roots in neighborhood societies and
markets around the planet are our unmatched legacy and the establishment for our future
development. We will bring our abundance of information and worldwide aptitude to the administration
of neighborhood shoppers - a genuinely multi-nearby global. Our drawn out progress requires a
complete obligation to remarkable norms of execution and efficiency, to cooperating adequately and to
a readiness to grasp groundbreaking thoughts and adapt consistently. We accept that to succeed
requires the best expectations of corporate conduct towards our workers, buyers and the social orders
and world in which we live. This is Unilever's street to maintainable, beneficial development for our
business and long haul esteem creation for our investors and representatives.

The Great Depression, which struck not long after the new association was outlined, impacted each
piece of Unilever's multifaceted action: its rough material associations faced worth reduces of 30 to 40
percent in the foremost year alone; cows cake, sold because of its oil plants, suffered with the lessening
of the agrarian business; margarine and other agreeable fats were affected by hurting competition as
the expense of spread plunged; and the association's retail staple and fish shops saw declining bargains.
As expenses and advantages around the globe found a way to fall, Unilever expected to act quickly to
build up a gainful course of action of control. The 'uncommon leading group of trustees' was set up in
September of 1930. Filling in as an administering body over the two sheets the association recently had,
the extraordinary warning gathering was proposed to change Dutch and British interests and go
probably as an inside agency for the affiliation. It furthermore began coordinating two barricades set to
deal with Unilever's world issues: a territory board to manage associations in Europe, and an abroad
chamber to control business elsewhere.

In spite of the fact that Unilever's development until the mid-1940s was an aftereffect of extended
product offerings and plant limits, its most prominent accomplishments somewhere in the range of 1945
and 1965 were its variation to new business sectors and innovation. The decade following World War II
was a time of recuperation, coming full circle by the mid1950s in fast monetary development in a large
part of the Western world. Until 1955 interest proceeded to rise and rivalry was not a significant issue.
Thereafter, nonetheless, overall revenues dropped, rivalry in Europe and North America honed, and
achievement was less guaranteed. Unilever's procedure was to gain organizations in new regions,
especially food and synthetic producers. Among the after war acquisitions were U.K. frozen
nourishments creator Birds Eye and U.S. frozen yogurt oddity producer Good Humor.

MISSION STATEMENT OF UNILEVER

To add vitality to life. We address regular issues for nourishment, cleanliness and individual
consideration with brands that help individuals feel better, look great and get more out of life.

VISION STATEMENT OF UNILEVER

To make sustainable living commonplace. We believe this is the best long-term way for our business to
develop.

PRODUCT OF UNILEVER:
• Food

• Energy drinks

• Baby food

• Soft drinks

• Cheese

• Ice cream

• Tea

• Cleaning agents

• Coffee,

• Pet food

• Bottled water

• Toothpaste

UNILEVER OBJECTIVE:

The fight for arising economies stays extreme as rivalry is savage. Unilever's Strategic points and goals in
the previous decade can be summed up dependent on a few key acquisitions and the evacuation of
organizations that are not as productive.

Rooha tahir
L1f17bsaf0078
SWOT Analysis
Strengths
Research and development

Research and development is the key which differentiate the Nestle in food industry. Nestle operates 21
research centers globally. Nestle heir more than 5000 employees for research and development centers.
Nestle has the largest network of research and development in the industry of foods and beverages.

In 2017 nestle spent 1.724 billion into research and development from which 60% of the amount they
spent on developing a nutritious product and they produced “Gerber Grabbers Strong Veggies
Squeezable Puree” a nutritious snack serving with vegetables and fruits. In 2018, nestle spent 1.7 billion
into research and development. In this year the brand S-26 were reshaped its GOLD range with HMOs
and lipids, a rare ingredients that helps to support in the development of brain. In 2019, Nestle invest
1.7 CHF billion for the purpose of research and development. Nestle made some changes in the
procedure of research and development. It created the accelerators, in which teams (include staff, start-
ups and students) present their ideas into prototypes for testing. For this purpose they can use labs,
kitchens pilot-scale equipment. With the period of six months their ideas can be tested commercially.

The competitor company unilever release C4G’s (connect 4 growth) program in 2017 for digitally
connected to research and development. It is also beneficial for close collaboration. They decided to
spend 900 million euros for research and development. In 2018, at university of Liverpool unilever
inaugurated the material innovation factory to support research and development efforts. It’s a world
class institute in advance material chemistry it helps to develop the more effective formula and packing
for unilever brand. In 2019, unilever spend 840 million euros on research and development. Unilever
operates six major research and development centers in India, china, UK, US and Netherlands. Their
main objective of research and development is to bring the best ideas from where they be.

Environmental Sustainability

Environmental sustainability is one of the important element of Nestle. They put its effort in keeping the
environment clean. Their main focus on reducing the usage of water, wastage, use of packing material
and non-renewable energy use.

In 2017, 253 factories of nestle produce zero waste production. To gain more customers and to keeping
the environment clean. In the same year nestle also launched a free mobile app that contain the
instruction for people that how to recycle the waste packing material correctly. They spent 230 million
in “Perrier bottling site” in France. In 2018, nestle were spending on environmentally-friendly packing
materials. As they are working on zero environmental impact in their operations they decided to work
on the performance of their packing and reduction in wastage of foods and other waste. The most
important part to achieve this objective is to caring of water. In 2019, nestle were working on to manage
its carbon footprint. Nestle joined “one planet business” for Biodiversity (OP2B), scaling up efforts to
secure and reestablished biodiversity. They kept on attempting to make their supply chain
deforestation. Over the 90% of their items set to be checked without deforestation before the finish of
2020.

Unilever also worked on environmental sustainability like greenhouse gas emission, reduce the half
amount of water needed and also delivering greater performance. In 2017, they increase the total
volume of agricultural raw material to 56%. As we know unilever is the only buyer of palm oil but they
physically produce 56% palm oil in 2017. 2018 was the challenging year for company because of the
economic and geopolitical uncertainty. Inflation arise due to the change in currency value. In 2019,
unilever working on its last year ambitious commitment that they reduce the use of plastic packing
because it is the main thing which effect environment of the company.

Weaknesses
High prices

The target market of nestle is higher class and upper middle class societies. Poor class and lower middle
class doesn’t able to buy nestle products because their prices are high. When the inflation arise people
stop buying the products of nestle they move to substitutes.

In 2017, price of nido powder milk was 378 and in 2018 nido price was 379 and in the next year 2019
price was 435. In 2019, a number of people moves to other substitutes and some stopped buying. Nestle
face the sales difficulties in 2019.

Unilever is a well repute brand. They provide its customers healthy and natural products. In 2017
unilever launched a new dishwasher and in 2018 a company produce magnum with variation and the
next year unilever produce vegan vegetarian butcher patties which prices are high that’s why only a high
class society can purchase these things.

Controversies

Nestle is the well-known largest brand in the world. So it attracts negative press. In the back years,
nestle faced many controversies against the use of water in some corners of the world. After that in
India Maggi controversy also effect on its image very badly. These variables influence the brand image,
sales and profits in the short and long run. Nestle also faced many other controversies including horse
meat scandal and child labor. It directly effects on its image and make it less trustworthy.

Unilever also faced many controversies like in 2019 people was calling boycott of the product of unilever
Ben & Jerry’s famous brand that they selling their ice creams illegally Israel settlements.

Opportunities
Digital marketing

Digital marketing is one of the best opportunity for nestle. Nestle can easily connect with its customers
and suppliers. It also gain customers by advertising through internet. It also useful for employees
engagement globally and for promotions.
In 2017, nestle take it as a competitive advantage by creating new delivering methods, developing good
relationships with their customers using both specialized and local platform. Nestle also connect with
new retailers from the various corners of the world. They invest in new businesses of foods for new
ideas and create new paths to markets and they also develop new services. In 2018, nestle connect
personally with their consumers through direct massages, complaints and demands, services and
products. Nestle said that with digital marketing they modernized his business and business operations.
During 2019, nestle became the top major food entity to open block chain technology. It helps to
consumer in tracking their food. They also use digital technology to recognize the customers need, then
serve them in most personalized way.

Unilever started digital marketing in 2017. By digital marketing a company increase its sales and brand
by 80%. Their aim is to create a one to one consumer relationship. In 2018, 40% of the market run
successfully through digital advertising. But the major challenge of digital marketing is to tackling fraud.
In 2019, company started to working with the European work council on the framework for the future of
work. Every employee will be invited for pull up an employability, reskilling or an up skilling plan, so they
prepared their selves for adapting the changing of work in the current year.

E- Commerce

In this modern world most of the people prefer online shopping. Growing the use of internet all over the
world nestle sell their products globally through e-commerce channel.

Trend of e-commerce started from 2018. In 2018 sales were increased by 18% through e-commerce. In
2019, e-commerce increase the sales of nestle by 18.5%. It put nestle to top Food Company. During the
year company nestle raise digital competencies, improve digital operations and better understanding
with customers.

Unilever provide its services to its customers through different channels. E-commerce is one of the
major channel to provide services to its consumers. In 2017, unilever sell its products in 39 different
markets through e-commerce. Their main focus is to directly connect with retailers all over the world
and consumers. In 2018, the sales were increase globally by 47% and the retailers are increase by 13%
through e-commerce. 2018 showed a good performance of e-commerce by operating the operations in
Hong Kong, Singapore, Taiwan and Malaysia through different channels. In 2019, unilever partnering
with large as well as small retailers to increase growth opportunities. A company increase its sales with
30% and the annual turnover increase with 6%. The global e-commerce was increase with 20% in 2019.

Healthy products

Nestle produce healthy and nutritious products. In today’s world, people are moving from rural areas to
urban areas. They are more conscious about their children health. Healthy and nutritious foods and
beverages attract the customers. It helps nestle to grow its sales and profit faster.

In 2017, nestle produced new premium mixes of “Nescafe Cold Brew” it includes taste and aroma. It also
launched “Stouffer’s Fit Kitchen Bowls” which include at least 20g of protein in every meal. In 2018,
nestle produce almost 1300 new products for children, women and babies. Nestle also create new
bottles for kids “water buddies” with the aim to make pure water for kids, and breaking their sugary
drink habits. In 2019, nestle launched the cat food “Tidy Cat” which is one of the best-selling product of
United States. This is a 100% natural product free from dyes, deodorizers, fragrances and chemicals.

Unilever said that consumers demand healthy products in low prices. They collaborate with thousands
of supplier and in 2017, a company spend almost 34 billion euro on their products also included 13
billion euros on raw material and ingredients. A company than hand out its products to more than 400
warehouse to retail stores which are around 25 million and then to different markets like hyper star,
supermarkets, cash and carry and to small stores. In 2018, unilever produced 19 new brands which
include home-cleansing product, love home and planet, natural skin care and hair care products. In
2019, rexona (unilever brand) introduce a clinical protection range which is three times stronger than
any ordinary anticipated and can long lasting for 96 hours.

Threats
Higher cost

Cost is the biggest threat for nestle because if cost increase the prices will increase and it reduce profit.
Cost may be increase by many factors such as transportation cost, raw material, labor cost and also by
inflation.

In 2017, nestle water deal with higher commodity cost. Margin expansion was upheld by working
efficiency and successful executive of rebuilding activities. These cost increase the commodity cost of
around CHF 900 million. In 2018, input cost are arising, prices increase in the America, it directly
reflected on the cost of distribution and packing. Profitability is highly affected by the increasing cost of
distribution and packing. In 2019, nestle make progress by reducing structural cost. It increase the
profitability of the company.

Higher cost is the major threat for unilever because consumers are price conscious they want healthy
products in low price. These challenges are mostly face by the retailers which effect the sales of the
company. In 2017, raw material cost and the manufacturing cost are increase due carbon pricing like use
of metal in packaging. During 2018 carbon pricing increase it effect the manufacturing cost and raw
material cost and the price of product increase. In 2019, non-underlying cost were increase 440 million
euros. These certain cost directly affect the price of product.

Competitive pressure

Competitive pressure is always the major threat for nestle. Competition in food industry is intensifying
and the expectations of customers are shifting. Unilever is the strong competitor for nestle because
they both are well earning and reputational food companies.

Pestle analysis

Political factor
Nestle perform its operation across 190 countries so the political factors affect its day to day operations.
GST were implement by the government. This effect negatively on the product pricing of company.

Nestle has to perform its operation within the given framework of laws which set by the parliament, and
that is the reason it relies on political consideration. Government plays a major role by forcing the laws
and guidelines on the organizations. Government set standard laws for organization that needs to meet
otherwise they will pay fine. Nestle always trying to meet all the guidelines laws which is set by the
government i.e. health and safety act and disabilities act but unluckily nestle break the laws. In
accounting standards, government rules and regulations, tax requirements (changes of tax rates,
created new laws of tax and revised tax law) are highly affected on nestle company.

Unilever pay all taxes implement by the government. In 2017, total taxes paid by the unilever is almost
3.9 billion euros. They show honesty and integrity with all the local and international taxes. Unilever
doesn’t support any political party or doesn’t involved in political funds. In 2018, political leverages was
become the threat for the company. Change currency value in turkey, Argentina and Pakistan and also a
political disruption in market. In 2019, unilever face economic and political instability and loss its half
turnover by sales decrease because of emerging markets.

Economic factors
To starting new production nestle has to aware about external factors such as the inflation rate,
economic growth rate and capital income of national per person. Economic condition changes from
nation to nation. In 2018, the companies profit grow by more than 40 percent. As per the organization,
profit increase from $7.6 billion to $10 billion. This achievement is get from three things: market of
china, United States market and selling of its confectionery business. This is a major difference, the
company reported is less than 2017. The company accused a reduction in customer demand in the Brazil
and US. However, then the CEO of nestle Mark Schneider held faith that the profit of the company
would increase in 2018. And he was right.

2017 was the challenging year for the world economy and for the consumer goods industry because of
the political instability. At the end of the year improvements are visible in India and china, but the other
countries are suffering with economic problems. In 2018, company engage its leadership with
stakeholders through platforms include world business council for sustainable development, world
economic forum and so on. And in 2019, unilever announce six of its brand on world economic forum
platform include dove, rexona, REN skin care and signal, love beauty and planet and axe.

Social factor
Cultural and the social environment had great effect on nestle. The major focus of nestle is on the social
changes include social attitudes and lifestyles because the social and the cultural environment changes
continually. Every country had its different culture like beliefs, values, religious, foods, family, clothing
and their lifestyle. As every nation has its different taste and different lifestyles, nestle has to make
some effective strategies to meet the different consumer behaviors and taste. Nestle is totally depends
on the customer attitude and lifestyle. Product and services can’t be effected until the company has
enough data about the consumer lifestyle. Company has to concentrate on social and cultural factor to
get their strategic objective.

Unilever operate its operation in more than 100 countries that’s why most of its advertisement come in
different languages like in Urdu, Hindi, English, deluge and Tamil. Also the company focus on beauty
products and skin care products like dove, lux and fair & lovely because it is one of the main desire of
everyone to look beautiful.

Unilever focus on to help people feel and look good. Even by the marketing or skin care or hair care
product such as dove they focuses on women feel good outside.

Technological factor
Technology create opportunities for developing new products, variation in existing products and of
course in new marketing techniques. Nestle uses a latest technology to improve their relationship with
customers they start using the new techniques to communicate with their customers in 2017. They use
e-commerce and internet to connect with their customers personal across the world. With the use of
new technology nestle gain new customers and its sales increase with 18% in 2018 and 18.5% in 2019.
Nestle become the largest food company in food industry. Nestle started taking orders by telephone and
on internet. They directly communicate with their customers and improve their products by listening
customer’s complaint and demands. Additionally, nestle utilizes innovation in different business exercise
such as maintain record of their customers and staff easily.

On the other side, unilever also continue their operations with new technology such as robotics, virtually
connect with their consumers with new ways, voice technology, robotics and artificial intelligence. In
2017, unilever focus on waste, a company ensure that overall plastic packing will be restricted in 2025.
They were investing in innovative technology such as Cresol. In 2018, unilever started working with
world class global leading technology companies to form a world class data analytics and world class
technology organization. They already successfully operated in many countries by saving time, reduces
cost and also provide online training programs. During 2019 they started working with Lomita, to launch
a technology which breaks down plastic to make it more recyclable.

Legal factor
The Legal factor of an organization deals with the legal environment of the company and effect on its
demand and cost. Nestle passed the laws for their members which is based on their health and safety.
Nestle has been pay the separate amount for their members for their free legal help.

Unilever operates its function in 169 countries and has a large product portfolio with more than 400
brands. That’s why unilever has to be careful about many rules and regulations. Customer of unilever
also aware about all the laws and rules of the company. It gain customers loyalty and trust of customers.

Environmental
Any large association has an environmental effect. . as we discuss earlier nestle major focus on reducing
the usage of water, wastage, use of packing material and non-renewable energy use to make their
environment clean. In 2017, 253 factories of nestle produce zero waste production. To gain more
customers and to keeping the environment clean. In the same year nestle also launched a free mobile
app that contain the instruction for people that how to recycle the waste packing material correctly.
They spent 230 million in “Perrier bottling site” in France. In 2018, nestle were spending on
environmentally-friendly packing materials. As they are working on zero environmental impact in their
operations they decided to work on the performance of their packing and reduction in wastage of foods
and other waste. The most important part to achieve this objective is to caring of water. In 2019, nestle
were working on to manage its carbon footprint. Nestle joined “one planet business” for Biodiversity
(OP2B), scaling up efforts to secure and reestablished biodiversity. They kept on attempting to make
their supply chain deforestation. Over the 90% of their items set to be checked without deforestation
before the finish of 2020.

Unilever also worked on environmental sustainability like greenhouse emission, reduce the half amount
of water needed and also delivering greater performance. In 2017, they increase the total volume of
agricultural raw material to 56%. As we know unilever is the only buyer of palm oil but they physically
produce 56% palm oil in 2017. 2018 was the challenging year for company because of the economic and
geopolitical uncertainty. Inflation arise due to the change in currency value. In 2019, unilever working on
its last year ambitious commitment that they reduce the use of plastic packing because it is the main
thing which effect environment of the company.

Ratio analysis
Liquid ratio
Liquidity ratio is the kind of financial ratio which is used to determine the entity’s capacity to meet its
short term debts obligations. Following are the liquidity ratios.

Current ratios
Current ratio shows its investors that how an entity can maximize its current assets to satisfy its short
term debts (1 year or less). Current ratio is equal to the company’s current assets by its current
liabilities. From 2017, the company has maintained a strong current ratio, which means a company is
good enough to meet unpredicted demand of cash. In 2018, nestle represent the higher figure to meet
the short-term obligations. Company was capable to meet 95% of its short term obligations.

On the other side, unilever increase its current ratio every year and a company make itself stronger to
meet its short term debts. But the current ratio of unilever is less than nestle each year.

Quick ratio analysis

Quick ratio shows the entity’s short-term liquidity position and measure an entity’s capacity to meet its
short term debts with its most liquid assets. In 2018, the entity was at the highest position to change its
cash and other current assets into cash and pay off. It shows a good trend of a company that means a
company can deal with its liquidity at any point.

A competitor company unilever shows that a company can deal with its liquidity at any point. The result
shows that the quick ratio of unilever is less than nestle.
Activity ratios
Activity ratio is the type of financial ratio which is used to determine the company’s turnover period.
Following are the activity ratios:

Inventory turnover ratio

Inventory turnover ratio shows that how quick entity sell its stock. As we see in 2017 and 2019 nestle
has the higher inventory turnover of 73% but in 2018 nestle deals with low inventory turnover that
indicates weaker sales.

Inventory turnover ratio of unilever increase in 2018 but decline in 2019 because of the political
instability. Unilever inventory turnover ratio is less than nestle each year.

Receivable days
Receivable days shows the period in which company collect its receivables from customers. It disclose
that how well the company manage its cash flow and how the company is stable financially.

Unilever shows that how company maintain its receivable turnover every year which means a company
make itself stable financially. But receivable turnover ratio is higher than nestle.

Payable days

Payable days show that how many times a company has to pay its creditors and suppliers. In 2017 the
payable turnover ratio is high may be because the company is struggling to pay the cash.

Unilever payable turnover ratio is higher than nestle every next year which means a company is taking
benefit from its payables.

Net profit

Net profit shows the net income of the company. As we see nestle doing well with its net profit.
Company increase its net profit every year.
Net profit of unilever is higher than nestle in 2017 and 2018 but in 2019 net profit is less than nestle
because the sales were decrease of unilever.

Gross margin

Gross margin also shows the profitability of the company compared to their cost. Gross margin is equal
to the sales of the company less cost of goods sold. In 2018 nestle decline its gross margin but in 2019
they maintain its sales and cost of sales.

Gross margin of unilever was less than nestle because the sales of unilever was less than nestle.

Return on equity (ROE)

Return on equity shows that how the company’s management is efficient to generate money from its
equity financing. Nestle is doing well every year. Company increase its income from its equity.

Unilever earn more return on its equity than nestle. The return on equity increase in 2018 and decline in
2019 but still higher than nestle.
 Amna ilyas
L1s18bsaf0022