Analysis of a Firm (Business Report) - Research Paper Example

However, an interim dividend has been paid to the shareholders though a decrease in net profit has been seen in 2011 as compared to the last year. Table of Contents Executive Summary 2 Company Overview – Woodside 4 Firm Analysis 4 Financial Analysis 5 Risk and Performance Analysis 7 Investments 8 Valuation 9 Conclusion 10 Reference List 11 Company Overview – Woodside Woodside is one of the major companies of Australia in the oil and gas sector. It is also one of the major operators of LNG plants.

They produce about 700,000 oil barrels every day and operate even in remote and sensitive regions of the world. Woodside produces eco-friendly gas to meet the energy requirements of the customers of Australia, China, and Asia Pacific regions. Woodside has a number of subsidiaries. The major operating subsidiary of the company is Woodside Energy ltd. Currently 3,856 employees are working for the company around the world. Woodside is also supported by 734 other third party contractors (Woodside, 2011a, p. 4). Firm Analysis Woodside started its journey in the year 1954.

Shell had 40 percent of the shares; BHP Billiton had shares in Woodside, too. . Woodside is large oil and gas company, and companies like Hansard Europe, BlackRock Fund Advisors, DWS Investment GmbH, etc. are its major shareholders. There are 20 other premium companies who are the shareholders of Woodside. Peter Coleman is the CEO of the company as well as the managing director. He has 27 years of experience as the vice-president of Exxon Mobil, one of the largest oil and gas company in the world.

Therefore, it can be understood that the management head of the company has adequate experience of handling a major oil and gas company. Moreover, Woodside is an attractive option for investors due to its financial performance, which we will be studying later in this report. This proves that the management of the company and the shareholders work with the common objective and goal of achieving and earning a sustainable profit for the company, and there is no conflict between them, as the strategic functions and systems of the company are transparent enough.

Financial Analysis The 2007-2011 financial analysis data of Woodside have been considered. The sales, or revenue generation of the company, have increased during this period. Though in the year 2008 Woodside earned revenue of US$ 5,045 million, it could boast of no more than US$ 3,487 in 2009. The reason might be the financial crisis which has engulfed the global economy. However, in 2010 and 2011, the revenue increased to US$ 4,193 and US$ 4,802 million respectively, which is about 15 percent increase in comparison with the previous year, as stated in Figure 1.

On the other hand, a gearing ratio of 28.6 percent in 2011 is higher than 26.3 percent in 2010. This signifies an increase in the leverages and, consequently, in risks associated with the company (Morning Star, 2012).