Woolworths Strategic Analysis
Table of Contents
1 Introduction 3
2 Background of the company and industry 3
2.1 Company History 3
2.2 Company Strategic Goals and Objectives 4
2.3 Industry Background. 6
3 Analysis 7
3.1 Trend Analysis 7
3.2 Ratio Analysis 10
3.3 Overall Analysis, Interpretation and Recommendation 15
4 Limitations 16
5 References 17
6 Appendix 18

1 Introduction
Woolworths Limited is the largest retail company in Australia and New Zealand in terms of sales and market capitalization. The company also happens to be the largest food and liquor retailer and the largest hotel and gaming poker machine operator in the country. While it has exhibited an impressive performance for the better part of the last three years, its stock price has been plummeting. This is a red flag because it implies that the company has become less attractive to investors. The main aim of this report is to analyze the financial performance of Woolworth in a bid to formulate recommendations that can be adopted to improve its strategic orientation. To this end, trend analysis and ratio analysis will be leveraged to identify its internal financial strengths and weaknesses. Trend analysis will entail the use of common size reports, trend percentages and annual percentage changes, which will help in identifying any anomalies in the company’s performance. Ratio analysis will, on the other hand, entail the use of profitability, efficiency, liquidity and investment ratios to determine how the company’s performance has been changing over time.
2 Background of the company and industry
2.1 Company History
Even though it is currently headquartered in New South Wales, Woolworths was established in 1924 in Pitt Street Sydney with a nominal capital of £25,000. The company exhibited considerable growth during the late 1920’s opening a second store in Sydney and stores in Brisbane and Perth. It continued to grow in the 1930’s, despite the great depression and by 1933, it had established 23 stores in Australia. This growth was retarded by the Second World War, but by 1955, the company had already opened 200 stores. During the same period, Woolworths, which was predominantly a variety chain, begun to move to the food sector by opening its first Supermarket at Beverly Hills. This marked the beginning of a series of acquisitions, which saw the company diversify its product portfolio into women’s clothing, electronics and food. By 1989 all the variety stores had been closed except one in Rundle Mall. It was also at this time that it was acquired by Industrial Equity Limited, becoming a wholly owned subsidiary, before it was eventually transformed into a public limited company in 1933, in what was at the time, the biggest share sale in Australia’s history. Woolworths later entered the petrol market in 1996, begun a joint venture with the Commonwealth bank in 1999 and has since entered into several strategic alliances with a myriad of organizations in various sectors.
2.2 Company Strategic Goals and Objectives
While the company’s strategic objectives are aimed at driving growth and stakeholder value, Woolworths makes deliberate efforts to engage in corporate social responsibility. In 2014, the company pursued four strategic priorities. First, it’s aimed at delivering sustainable growth in establishing divisions, while investing in future growth. To this end, it extended its leadership in the food and liquor division, as evidenced by a general increase in comparable sales, earnings before interest and taxes (EBIT) and market share. The company also delivered excellent value to its customers by providing them with more than $750 million in savings through its supermarkets’ promotional campaigns. There was also an average price deflation of 3.1% during the year. Consistent with its strategy, the company’s market share grew faster in the fresh market than in grocery retailing. Woolworths was also in a position to provide more convenient access to its customers both in-store and online by opening 34 new supermarkets in Australia, 11 new Dan Murphy’s stores and introducing new features to its online platform aimed at improving the shopping experience for customers. Through these initiatives, the company was able to serve an average of 21.1 million customers per week during the year.
Furthermore, the company enhanced its leading liquor offer in Australia with improvements in its leading store formats and online offers. Other than that, damurphy.com.au retained the number one position as the most visited liquor website in the country. Apart from the impressive performance it exhibited in Australia, Woolworths also reinforced its value credentials in New Zealand, with strong customer response to its “Price Drop” and “Price Lockdown” campaigns. Moreover, the company strengthened its petrol offer by refreshing 67 canopies and forecourts to enhance customer access to diesel and premium fuels. Lastly, its improved merchandise offer also showed impressive results.
The second priority was to maintain its track Record in building new growth businesses. The company expanded its market position as the largest domestic online retailer in Australia, with at least $1.2 billion in online sales, which represented a 50% increase from the 2013. The company’s online offers in Australian liquor and food were characterized by an impressive growth and so was the apparel business. Woolworths also continued to lead in innovation with its innovative products and services including, ‘Track My Order’ GPS routing and ‘Click & Collect’. Other than that, the company acquired EziBuy in a bid to promote online sales in general merchandise. Furthermore, it focused on promoting Home Improvement from its start-up status to a scalable profit generating division of the group.
Thirdly, the company made deliberate efforts to institute enablers for a new growth era. This was achieved through investment in state of the art technology and logistics, building customer loyalty and strengthening its world class retail team by blending the best local and international talent.
Finally, the company monitored its portfolio closely in order to maximize shareholder value. To achieve this, Woolworths took advantage of available market opportunities to divest in property, particularly by selling and leasing back a portfolio of freehold Hotel sites amounting to $600 million. This was an addition to $1.4 billion worth of property that had been divested through the establishment of the SCA Property Group in 2013. The company also began to transform BIG W in a bid to achieve operational excellence under Matt Tyson’s new Leadership. Moreover, a program aimed at introducing voluntary pre-commitment functionality on the hotels’ gaming machines was underway. Last but not least, the company acquired Hudson Building Supplies in order to improve its presence in Queensland and New South Wales.
2.3 Industry Background.
The nature of the competitive environment in the Australian retail market can be explained using Porters Five Forces Framework. The framework is particularly used to analyze the threat posed by substitute products and new entrants, the bargaining power of buyers and suppliers and the competitive rivalry among sellers. This analysis will provide valuable insights on the opportunities and threats available in the company’s external environment. The threat of substitute products is relatively weak because the major competitors of large-scale retailers are small grocery stores, which charge higher prices for their commodities. This is because the former enjoy economies of large scale production, which enable them to charge lower prices for their commodities. The threat of new entrants is also weak due to the high barriers of entry occasioned by the aforementioned economies and high capital requirements. Moreover, key players in this industry are also making deliberate efforts to ensure that new entrants are locked out of the market.
Better still, there are very many suppliers in the market, which implies that they have a weak bargaining power. Similarly, buyers have a weak bargaining power because there are very many buyers in the market such that the individual actions of a single buyer have no significant influence on market prices. Additionally, these buyers purchase goods in very small quantities, which have a negligible impact on market demand. Other than that, most buyers are loyal to specific brands, which makes their price elasticity fairly rigid. Finally, there is a fierce competitive rivalry among the industry titans because they are all striving to gain majority share of the market and enhance their overall profitability.

3 Analysis
3.1 Trend Analysis
Trend analysis entails the evaluation of a series of financial statement data relating to a single company over a period of time in order to determine the changes in the overall performance of the company from period to period (Wainwright, 2012). This type of analysis reveals whether the various items in the company’s financial statements such as sales, gross profit, expenses, and net income are increasing or decreasing over time (Mautz & Angell, 2006). This section will mainly focus on the analysis of common size reports, which will help in identifying the potential strengths and weaknesses in the company’s performance.
The common size statements below generally reveal that the company is very profitable owing to the constant increase in both gross and operating profits throughout the period. It is also evident that operating costs have remained fairly constant while the earnings per share have generally been increasing. In the statement of financial position, there has been an increase in the total current assets and a decline in total current liabilities, which further points to an improvement in the liquidity of the firm. However, while total non-current liabilities have also been declining, the total equity has exhibited a considerable growth, which could dilute any improvements in liquidity and shareholder returns.

Table 1: Common size income statement
2012 2013 2014
$m $m $m
Continuing Operations
Revenue from the sale of goods 100.00% 100.00% 100.00%
Other operating revenue 0.25% 0.27% 0.30%
Total revenue from continuing operations 100.25% 100.27% 100.30%
Cost of sales (73.99%) (73.33%) (73.18%)
Gross profit from continuing operations 26.26% 26.94% 27.11%
Other revenue 0.41% 0.42% 0.40%
Branch expenses (15.92%) (16.75%) (16.74%)
Administration expenses (4.66%) (4.47%) (4.56%)
Earnings from continuing operations before interest and tax 60.80% 6.14% 6.21%
Financial expense (0.58%) (0.70%) (0.46%)
Financial income 0.06% 0.05% 0.03%
Net financing costs from continuing operations (0.51%) (0.65%) (0.43%)
Profit from continuing operations before income tax expense 5.57% 5.49% 5.78%
Income tax expense relating to continuing operations (1.61%) (1.64%) (1.74%)
Profit from continuing operations after income tax expense 3.96% 3.85% 4.05%
Discontinued Operations
Profit from discontinued operations (0.66%) 0.02% 0.00%
Profit for the period 3.30% 3.87% 4.05%
Profit attributable to:
Equity holders of the parent entity 3.30% 3.86% 4.03%
Non-controlling interests 0.01% 0.01% 0.01%
Profit for the period 3.30% 3.87% 4.05%
Profit attributable to equity holders of the parent entity relates to:
Profit from continuing operations 3.96% 3.84% 4.03%
Profit from discontinued operations (0.66%) 0.02%
Profit attributable to equity holders of the parent entity 3.30% 3.86% 4.03%
Earnings Per Share (EPS) from continuing and discontinued operations
Basic EPS (cents per share) 0.27% 0.31% 0.32%
Diluted EPS (cents per share) 0.27% 0.31% 0.32%
Weighted average number of shares used in the calculation of Basic EPS (million) 2.22% 2.11% 2.05%
Earnings Per Share (EPS) from continuing operations
Basic EPS (cents per share) 0.32% 0.31% 0.32%
Diluted EPS (cents per share) 0.32% 0.31% 0.32%

Table 2: Common size statement of financial position
2012 2013 2014
$M $m $m
Current assets
Cash and cash equivalents 3.86% 3.82% 3.81%
Trade and other receivables 4.03% 4.35% 3.82%
Inventories 17.14% 18.90% 19.39%
Other financial assets 0.11% 0.24% 0.05%
25.14% 27.31% 27.08%
Assets classified as held for sale 1.75% 0.67% 2.56%
Total current assets 26.89% 27.98% 29.64%
Non-current assets
Trade and other receivables 0.11% 0.07% 0.45%
Other financial assets 1.11% 1.61% 1.26%
Property, plant and equipment 44.43% 41.56% 39.66%
Intangible assets 24.48% 26.00% 26.17%
Deferred tax assets 2.99% 2.78% 2.82%
Total non-current assets 73.11% 72.02% 70.36%
Total assets 100.00% 100.00% 100.00%
Current liabilities
Trade and other payables 24.29% 24.23% 24.81%
Borrowings 0.25% 0.76% 0.91%
Current tax liabilities 1.03% 0.87% 0.66%
Other financial liabilities 0.50% 0.66% 0.69%
Provisions 4.35% 4.35% 4.15%
Total current liabilities 31.35% 30.86% 31.23%
Non-current liabilities
Borrowings 21.76% 19.25% 17.09%
Other financial liabilities 4.11% 4.46% 4.77%
Provisions 2.44% 2.47% 2.34%
Other 1.20% 1.17% 1.09%
Total non-current liabilities 29.51% 27.34% 25.29%
Total liabilities 60.86% 58.20% 56.52%
Net assets 39.14% 41.80% 43.48%
Equity
Issued capital 20.09% 20.33% 20.04%
Shares held in trust -0.28% -0.81% -0.90%
Reserves -1.13% 0.11% 0.82%
Retained earnings 19.29% 20.95% 22.40%
Equity attributable to equity holders of the parent entity 37.94% 40.58% 42.36%
Non-controlling interests 1.20% 1.22% 1.13%
Total equity 39.14% 41.80% 43.48%

3.2 Ratio Analysis
Financial Ratios provide a quick and simple means of evaluating the financial health of a business. Even though some of these ratios had already been computed in Woolworth’s Annual Reports, the computations were reviewed in order to determine whether they are consistent with the definitions outlined in this report. While some of the ratios were found to be consistent with the said definitions, there was a slight discrepancy between the values reported in the 5 year summary presented in the 2014 annual report and the values reported in the individual annual reports for each year especially for 2012 and 2011. For instance, the sales value for 2012 has been indicated as 54.78 billion in the 5 year summary, but it is actually 55.12 billion in the 2012 annual report. For this reason, there is a slight difference between the financial ratios indicated on the 5 year summary and the ones computed for this report. As such, this analysis will consider both the ratios provided in the annual reports and those that were calculated.
Profitability Ratios
Profitability ratios generally evaluate the capacity of a business to generate wealth for its owners. The most common profitability ratios include return on equity (ROE), return on capital employed (ROCE), Net Profit Margin and Gross Profit Margin. ROE is a ratio of the amount of profit available to the owners who have a stake in the business. It essentially compares the net profit after taxation and preference dividends to the sum of average ordinary share capital and reserves. ROCE, on the other hand, evaluates the relationship between the net profit generated during a given financial period and the long term capital invested in the business. It is expressed as a ratio of operating profits (EBIT) and the sum of share capital, reserves and non-current liabilities.
Finally, both operating profit margin and gross profit margin relate the profitability of the business to the sales achieved during a given period. Nonetheless, while computing the gross profit margin, profitability is merely expressed as the difference between sales and cost of goods sold (gross profit). On the other hand, operating profit margin not only accounts for the cost of goods sold, but also sales general and administrative expenses. All these ratios are directly proportional to the financial performance of a business, which implies that the higher the profitability ratios, the better the financial performance.
Table 3: Profitability ratios
2012 2013 2014
Gross Profit Margin Computed 26.26% 26.94% 27.11%
Annual Report 26.40% 26.94% 27.11%
Operating Profit Margin Computed 6.08% 6.14% 6.21%
(EBIT Margin) Annual Report 6.11% 6.24% 6.21%
Return on Ordinary Shareholder’s Funds Computed 22.19% 25.08% 23.98%
(Return on Equity) Annual Report 27.89% 27.37% 25.43%
Return on Capital Employed Computed 22.63% 23.37% 22.68%
(Pre-tax Return on Funds Employed) Annual Report 24.08% 27.61% 26.98%

Despite the slight discrepancy between computed and annual report ratios in 2012 and 2013, it is evident that there was a general increase in both gross profit margin and operating profit margin throughout the three year period. This implies that the company’s effectiveness in generating wealth for its stakeholders has also been improving during this period. On the other hand, both the return on ordinary shareholders’ funds and ROCE were characterized by huge fluctuations, which is a likely indicator of instability in the company’s overall profitability.
Efficiency Ratios
Some of the common ratios used to evaluate the efficiency of a business include average inventory turnover period, the average settlement period for accounts receivable, the average settlement period for accounts payable, sales revenue to capital employed and sales revenue per employee. Average inventory turnover period measures the average period inventory was held before being released to customers. A shorter average inventory turnover period, therefore translates to higher efficiency, which in turn results in higher profitability. The average inventory period for accounts receivable computes the average time taken for customers to pay amounts owed. Conversely, the average inventory period for accounts payable reflects the average time taken for the business to pay its creditors. Finally, sales revenue to capital employed and sales revenue per employee both relate the sales revenue generated during a given financial year to the resources at the disposal of the business, in this case capital employed and labor respectively. The two ratios examine the effectiveness with which the resources in the business are being utilized to generate sales revenue.
Table 4: Efficiency Ratios
2012 2013 2014
Average inventory turnover period 33.26 33.61 36.52
Average settlement period for accounts receivable 4.91 4.05 3.94
Average settlement period for accounts payable 37.63 34.42 35.85
Sales revenue to capital employed 3.72 3.80 3.65
Number of Employees 190,000 197,000 98,000
Sales revenue per employee 290,156.84 297,037.56 306,933.33

The average inventory turnover period has grown substantially during the period, which is a good sign because it implies that the company’s inventory was being sold and replaced more times in 2013 compared to previous years. Moreover the average settlement for accounts receivable declined, suggesting that the company was more effective at collecting sales revenue from its debtors. Unfortunately, while it was keen on collecting money from its creditor, the average settlement period for accounts payable increased in 2014, which means that it was more reluctant to pay its creditor during the year. The sales revenue to capital employed ratio also declined, indicating a deterioration in the company’s effectiveness in utilizing the resources at its disposal to generate sales revenue. The employees were, however utilized constructively throughout the period as evidenced by the increase in sales revenue per employee.
Liquidity Ratios
Current ratio compares a company’s current assets to its current liabilities and essentially reflects the company’s ability to meet its short-term financial obligations as and when they fall due. The quick ratio compares the current assets, exclusive of inventory and prepayments to current liabilities. The quick ratio is more stringent compared to the current ratio because it reflects the company’s ability to meet its short term financial obligation using current assets that can be converted to cash and cash equivalents at an arm’s length transaction. The gearing ratio measures the contribution of long-term financers to the capital structure of a company. Finally, interest coverage ratio measures the amount of profit available to cover interest expenses.
Table 5: Liquidity Ratios
2012 2013 2014
Current Ratio 85.75% 90.68% 94.93%
Quick Ratio 25.53% 27.26% 24.62%
Gearing Ratio 42.99% 39.55% 36.77%
Interest Cover Ratio 10.53 8.77 13.59

From Table 5 above, it is evident that the company’s liquidity position is very impressive. There was a constant growth in the current ratio, which suggests that the company’s ability to meet its short-term financial obligations has been improving throughout the three year period. Additionally, the gearing ratio has been declining, which indicates a decline in the company’s financial leverage. This implies that the company is at a lower risk of insolvency than it was three years ago. On the other hand, there was a significant drop in the company’s quick ratio, which suggest that the company’s ability to meet its short term financial obligations from current assets, which can be converted into cash and cash equivalents has declined. Finally, despite the fluctuation in the interest coverage ratio, the ratio increased significantly from 2013, illustrating that the company was a better position to cover its interest costs in 2014 compared to 2013.
Investment Ratios
Investment ratios include dividend payout ratio, dividend yield ratio, earnings per share (EPS), and price/earnings (P/E) ratio. The dividend payout ratio measures the proportion of earnings paid out to shareholders in terms of dividends. Closely related to the dividend payout ratio, dividend yield ratio evaluates the return on a share based on its market value. Earnings per share is, on the other hand, used to determine the earnings attributable to each individual share in the company while P/E ratio compares the market price per share to earnings per share. Different investors have different preferences and interests in a company. Some prefer share growth while others prefer annual returns. As such, the company should strive to strike a reasonable tradeoff between the two objectives as opposed to focusing on a single objective. Consequently, while Woolworths primary focus on driving growth and stakeholder value, it should ensure that its shareholders are guaranteed a substantial return at the end of every financial year.
Table 6: Investment Ratios
2012 2013 2014
Dividends Paid (millions) 723.9 770.6 815.6
Dividends per share (Cents) 59 62 65
Dividends Payable(millions) 824.4 887.7 907.1
Dividends per share (Cents) 67 71 72
Total Dividends paid/payable (millions) 1548.3 1658.3 1722.7
Total Dividends per share (Cents) 126 133 137
Dividend pay-out ratio 85.2% 73.4% 70.3%
Market Price Per Share (As at June) 22.51 29.49 33.45
Dividend yield ratio 3.92% 3.16% 2.87%
Earnings per share
Basic EPS (cents) 148.67 182.6 196.5
Diluted EPS (cent) 147.93 181.8 195.6
Price/earnings (P/E) ratio 15.14% 16.15% 17.02%

The company has successfully managed to provide dividends to its investors at the end of each of the three financial periods. Nonetheless, the dividend payout ratio has been declining throughout the period and so has the dividend yield. This implies that the company is becoming less attractive to investors compared to other companies as illustrated in figure 1 below. It should however be noted that the EPS and P/E ratio have been growing significantly during the period. This points to the fact that more of the company’s profits were being retained by the company as reserves, which is evident in the statement of financial position. Notwithstanding, the company should consider revising its dividend policy in order to enhance its stock performance.
Figure 1: Stock performance

3.3 Overall Analysis, Interpretation and Recommendation
The discrepancy in the calculated return on ordinary shareholder’s funds and the ROE provided in the company’s annual reports was occasioned by the fact that the ROE on the annual report is the ratio of profit after income tax attributable to shareholders and the average (of opening and closing) shareholders’ equity for the year. Moreover, the discrepancy between the computed ROCE and the ROCE (or ROFE) in the annual report arises because the former is a ratio of EBIT and the difference between Total assets and current liabilities, while the latter is a ratio of EBIT and average (of opening and closing) funds employed for the year. On the bottom line, despite the fact that the company was very effective in generating profits from its operations, its overall profitability is not only unstable but has also declined compared to 2013. This suggests that the company employed more capital in generating its profit in 2014 compared to 2013.
4 Limitations
The quality of the underlying financial statements determines the usefulness of the ratios derived from them. Ratios therefore only offer a restricted view of the ‘relative’ performance and position of the company, and not the full picture. No two businesses are identical and the greater their differences, the greater the limitations of ratio analysis as a basis for comparison. Additionally, any ratios based upon balance sheet figures will not be representative of the whole period because the balance sheet is a snapshot of a moment in time.

5 References
Carson, V. (2007, August 28). Now it’s Woolworths, the credit card people. Retrieved from They Sydney Morning Herald: http://www.smh.com.au/news/national/now-its-woolworths-the-credit-card-people/2007/08/27/1188067034518.html
Finance Informer. (2008, August 18). Woolies MasterCard Debuts in Two Weeks. Retrieved from Finance Informer: http://www.financeinformer.com.au/woolies-mastercard-debut/
Mautz, R. D., & Angell, R. J. (2006). Understanding the Basics of Financial Statement Analysis. Author Mautz, R David, Jr; Angell, Robert J, 21(5), 27-34.
McMahon, S. (2006, March 29). Retail giants place side bet on pokies. Retrieved from The Age: http://www.theage.com.au/news/business/retail-giants-place-side-bet-on-pokies/2006/03/28/1143441151233.html
Morning Star. (2015, June 21). Woolworths Ltd WOLWF . Retrieved from Morning Star: http://performance.morningstar.com/stock/performance-return.action?t=WOLWF&region=usa&culture=en-US
New Zealand Herald. (2007, October 26). Commission: Red Shed takeover would create a ‘pure duopoly’. Retrieved from The New Zealand Herald: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10472143
Wainwright, S. (2012). Principles of Accounting: Volume I. San Diego, CA: Bridgepoint Education, Inc. .
Woolworths Limited. (2015, June 21). Woolworths Limited. Retrieved from http://www.woolworthslimited.com.au/
Yahoo Finance. (2015, June 21). Historical Prices. Retrieved from Yahoo Finance: https://au.finance.yahoo.com/q/hp?s=WOW.AX
6 Appendix
2012 2013 2014 2013 2014
$M $m $m $m $m
Current assets
Cash and cash equivalents 100.00% 101.90% 110.70% 1.90% 10.70%
Trade and other receivables 100.00% 111.35% 106.41% 11.35% 6.41%
Inventories 100.00% 113.71% 126.90% 13.71% 26.90%
Other financial assets 100.00% 227.73% 53.36% 127.73% (46.64%)
100.00% 112.02% 120.81% 12.02% 20.81%
Assets classified as held for sale 100.00% 39.47% 164.75% (60.53%) 64.75%
Total current assets 100.00% 107.31% 123.66% 7.31% 23.66%
Non-current assets
Trade and other receivables 100.00% 67.76% 441.63% (32.24%) 341.63%
Other financial assets 100.00% 150.21% 127.60% 50.21% 27.60%
Property, plant and equipment 100.00% 96.42% 100.12% (3.58%) 0.12%
Intangible assets 100.00% 109.51% 119.94% 9.51% 19.94%
Deferred tax assets 100.00% 95.92% 105.75% (4.08%) 5.75%
Total non-current assets 100.00% 101.55% 107.93% 1.55% 7.93%
Total assets 100.00% 103.10% 112.16% 3.10% 12.16%
Current liabilities
Trade and other payables 100.00% 102.83% 114.58% 2.83% 14.58%
Borrowings 100.00% 311.40% 403.49% 211.40% 303.49%
Current tax liabilities 100.00% 87.22% 71.74% (12.78%) (28.26%)
Other financial liabilities 100.00% 135.85% 156.61% 35.85% 56.61%
Provisions 100.00% 102.92% 106.97% 2.92% 6.97%
Total current liabilities 100.00% 101.47% 111.71% 1.47% 11.71%
Non-current liabilities
Borrowings 100.00% 91.21% 88.09% (8.79%) (11.91%)
Other financial liabilities 100.00% 111.88% 130.21% 11.88% 30.21%
Provisions 100.00% 104.15% 107.60% 4.15% 7.60%
Other 100.00% 100.23% 101.62% 0.23% 1.62%
Total non-current liabilities 100.00% 95.53% 96.12% (4.47%) (3.88%)
Total liabilities 100.00% 98.59% 104.15% (1.41%) 4.15%
Net assets 100.00% 110.11% 124.62% 10.11% 24.62%
Equity
Issued capital 100.00% 104.29% 111.84% 4.29% 11.84%
Shares held in trust 100.00% 297.36% 360.63% 197.36% 260.63%
Reserves 100.00% -10.29% -81.26% (110.29%) (181.26%)
Retained earnings 100.00% 111.95% 130.26% 11.95% 30.26%
Equity attributable to equity holders of the parent entity 100.00% 110.26% 125.21% 10.26% 25.21%
Non-controlling interests 100.00% 105.42% 105.73% 5.42% 5.73%
Total equity 100.00% 110.11% 124.62% 10.11% 24.62%

Trend Percentage Percentage Change
2012 2013 2014 2013 2014
$M $m $m $m $m
Continuing Operations
Revenue from the sale of goods 100.00% 106.14% 110.24% 6.14% 10.24%
Other operating revenue 100.00% 113.53% 129.16% 13.53% 29.16%
Total revenue from continuing operations 100.00% 106.16% 110.28% 6.16% 10.28%
Cost of sales 100.00% 105.20% 109.03% 5.20% 9.03%
Gross profit from continuing operations 100.00% 108.88% 113.82% 8.88% 13.82%
Other revenue 100.00% 110.78% 108.59% 10.78% 8.59%
Branch expenses 100.00% 111.65% 115.94% 11.65% 15.94%
Administration expenses 100.00% 101.72% 107.73% 1.72% 7.73%
Earnings from continuing operations before interest and tax 100.00% 10.72% 11.26% (89.28%) (88.74%)
Financial expense 100.00% 128.84% 87.28% 28.84% (12.72%)
Financial income 100.00% 87.57% 51.16% (12.43%) (48.84%)
Net financing costs from continuing operations 100.00% 133.87% 91.68% 33.87% (8.32%)
Profit from continuing operations before income tax expense 100.00% 104.77% 114.56% 4.77% 14.56%
Income tax expense relating to continuing operations 100.00% 108.46% 119.40% 8.46% 19.40%
Profit from continuing operations after income tax expense 100.00% 103.27% 112.60% 3.27% 12.60%
Discontinued Operations
Profit from discontinued operations 100.00% -2.65% 0.00% (102.65%) (100.00%)
Profit for the period 100.00% 124.62% 135.29% 24.62% 35.29%
Profit attributable to:
Equity holders of the parent entity 100.00% 124.37% 134.95% 24.37% 34.95%
Non-controlling interests 100.00% 104.00% 134.00% 4.00% 34.00%
Profit for the period 100.00% 124.62% 135.29% 24.62% 35.29%
Profit attributable to equity holders of the parent entity relates to:
Profit from continuing operations 100.00% 103.06% 112.31% 3.06% 12.31%
Profit from discontinued operations 100.00% -2.65% (102.65%)
Profit attributable to equity holders of the parent entity 100.00% 124.37% 134.95% 24.37% 34.95%
Earnings Per Share (EPS) from continuing and discontinued operations
Basic EPS (cents per share) 100.00% 122.82% 132.17% 22.82% 32.17%
Diluted EPS (cents per share) 100.00% 122.90% 132.22% 22.90% 32.22%
Weighted average number of shares used in the calculation of Basic EPS (million) 100.00% 101.26% 102.13% 1.26% 2.13%
Earnings Per Share (EPS) from continuing operations
Basic EPS (cents per share) 100.00% 101.77% 110.00% 1.77% 10.00%
Diluted EPS (cents per share) 100.00% 101.83% 110.04% 1.83% 10.04%