"BIZNES meble.pl" international 1/2018

analysis X industry tes the lower involvement of foreign financing in the business activity. That thesis is also confirmed by declining of general debt ratio to 36.22%, which is the lowest since 2010. This proves that the situation of the furniture industry in Poland is improving and that the industry depends less on bank loans. The good standing of the industry on payment of liabilities is also confirmed by the current liquidity ratio, which is at the level of 1.8 – identical to that of 2015. The current liquidity ratio should be in the range of 1.2 to 2.0. A rate over 2.0 indicates a lack of cash – the money is not working, while a rate less than 1.0 means that companies do not regulate their current liabilities, which can lead to bankruptcies. Summing up the year 2016, it should be noted that the upward trend started in 2014 was maintained. Profitabili- ty ratios have improved and debt and liquidity ratios are at safe levels. De- mand for Polish furniture is growing, which allows manufacturers to increase the margin on the sold products. This is certainly a result of adapting the in- dustry to the current situation and im- proving situation in the entire economy, both domestic and foreign. The only area for potential future turmoil is the decreasing return on equity and at the same time the decline in external finan- cing, which may indicate that entrepre- neurs are hesitating to invest. And in today’s dynamic times, the lack of inve- stment may in the future be reflected in the failure to function in a dynamically changing reality. But these conclusions can be drawn only after some time, after a more careful analysis of invest- ment in the industry. Meanwhile, let us enjoy and try to swim as far as we can. To make the most of the cake we were able to get – let it be a wish for furniture manufacturers for the nearest period. d HOW WAS 'ZOTA 200 – REPORT ON POLISH FURNITURE PRODUCERS' PREPARED 'Złota 200 – report on Polish furniture producers' was prepared in cooperation with the Info Veriti Polska company. All published financial data (net revenue from sale of products, goods and materials, fixed assets, current assets, stock, cash and cash equivalents, total assets, equity, net profit, long-term liabilities, short-term liabilities) comes from financial statements submitted to National Court Register (KRS) and was not verified by our editorial board. Remaining data (year-over-year change, ROA, ROS, ROE, debt ratio and current ratio) are derived from inner calculations. Blank space means that those financial data was lacking in financial statements we have received. 'Złota 200' presents data of the companies that have decla- red core business in KRS from the following sections: 31.01.Z Manufacture of office and shop furniture 31.02.Z Manufacture of kitchen furniture 31.03.Z Manufacture of mattresses 31.09.Z Manufacture of other furniture The declared core business was also not verified by our editorial board.Thus the report may include those entities that declaredmanufacturing furniture in the KRS, yet the never actually produced furniture. On the other hand, revenue in the company’s manufacturing furniture not always is connected strictly to furniture. Financial data from the most companies comes from 2016 and usually – altho- ugh not always – coincide with the calendar year. However we also included those companies whose financial statements were not available at the moment of closing that publication. In those cases we present data from previous year: 2015 or any other last available period. The final order of the report was determined by the net revenue from sale of products, goods and materials. We did not include in the report sole traders and civil partnership since those entities are not obliged by low to submitting financial statements to KRS. WHAT DO THE VARIOUS INDICATORS MEAN? The return on assets ratio, often called the return on total assets, is a profitabili- ty ratio that measures the net income produced by total assets during a period by comparing net income to the average total assets. In other words, the return on assets ratio or ROA measures how efficiently a company can manage its assets to produce profits during a period. In short, this ratio measures how profitable a company's assets are. ROA formula is as follows: Return on sales (ROS), often called the operating profit margin, is a financial ratio that calculates how efficiently a company is at generating profits from its revenue. The return on sales formula is calculated by dividing the net income by the net sales for the period according to following formula: The return on equity ratio or ROE is a profitability ratio that measures the ability of a company to generate profits from its shareholders investments in the company. In other words, the return on equity ratio shows howmuch profit each dollar of common stockholders' equity generates. ROE is also an indicator of how effective management is at using equity financing to fund operations and grow the company. Formula: Debt ratio – another index included in the report – is defined as the ratio of total – long-term and short-term liabilities to total assets. It can be interpreted as the proportion of a company’s assets that are financed by debt. Debt ratio can be expressed by following formula: The last index is current ratio. It measures a company’s ability to pay off its short-term liabilities with its current assets. The current ratio is an important measure of liquidity because short-term liabilities are due within the next year. We can count it using following formula: REFERENCE TO THE TABLE ON PAGE 28-35: (1) DATA COLLECTION PERIOD 1 SEPTEMBER 2015 TO 31 AUGUST 2016 (2) DATA COLLECTION PERIOD 1 JANUARY 2015 TO 31 DECEMBER 2015 (3) DATA COLLECTION PERIOD 1 APRIL 2015 TO 31 MARCH 2016 (4) DATA COLLECTION PERIOD 1 APRIL 2016 TO 31 MARCH 2017 (5) DATA COLLECTION PERIOD 1 JUNE 2015 TO 31 MAY 2016 (6) DATA COLLECTION PERIOD 1 MARCH 2016 TO 28 FEBRUARY 2017 (7) DATA COLLECTION PERIOD 1 MAY 2015 TO 30 APRIL 2016 (8) DATA COLLECTION PERIOD 1 JULY 2015 TO 30 JUNE 2016 (9) DATA COLLECTION PERIOD 1 JANUARY 2015 TO 29 FEBRUARY 2016 (10) DATA COLLECTION PERIOD 14 OCTOBER 2015 TO 31 DECEMBER 2016 (11) DATA COLLECTION PERIOD 1 OCTOBER 2015 TO 30 SEPTEMBER 2016 net income total assets x 100% ROA = net income revenue on sales x 100% ROS = net income equity x 100% ROE = total liabilities total assets x 100% Debt ratio = current assets short-term liabilities Current ratio = international edition 1/2018 [ BIZNES meble.pl 27