Understand the real health of your company.
We examine your financial statements to identify strengths, weaknesses and opportunities for improvement.
Clear reports to understand how the business is evolving, anticipate risks and build a solid basis for strategic decisions.
What is financial analysis, and what is it for?
Financial analysis is a complete picture of a company’s financial health. Using the balance sheet, income statement and cash flows, we calculate the key indicators, understand what lies behind the numbers and identify the margin and cash flow levers to act on.
It is a one-off assignment with a clear start and finish: it ends with an executive report and a prioritised action plan. It is particularly useful before seeking financing, preparing a corporate transaction or when the business is growing but profits are not keeping pace.
When you need to know what is really happening.
- You sell more but don’t earn more
- Cash flow is under pressure, or you rely on bill discounting and credit facilities to make payments.
- You are seeking financing or preparing a corporate transaction (acquisition, sale or new shareholders).
- You are planning an investment
- You want to anticipate risks early
- You are preparing a strategic plan
- It is unclear which customer, product or plant makes or loses money.
A complete picture.
- Balance sheet: structure, net debt, NOF and cash cycle
- PyG: mix, gross/operating margin, fixed/variable costs
- Cash flow: operating, investing and financing
- Turnover: customers, suppliers, inventory
- Profitability: ROE, ROCE, break-even and operating leverage
The indicators, explained
| Indicator | What it tells you |
|---|---|
| NOF (operating working capital requirements) | How much cash the company needs tied up to operate: inventory and outstanding customer receivables minus outstanding supplier payables. |
| Cash cycle | How many days pass between paying suppliers and collecting payment from customers. |
| Net debt | Financial debt minus available cash. |
| ROE | The return shareholders earn on the capital they have contributed. |
| ROCE | The return on all capital employed in the business, both equity and debt. |
| Break-even point | How much you need to sell to cover all costs without making a loss. |
| Operating leverage | How much profit changes when sales change, depending on the share of fixed costs. |
NOF (operating working capital requirements)
- What it tells you
- How much cash the company needs tied up to operate: inventory and outstanding customer receivables minus outstanding supplier payables.
Cash cycle
- What it tells you
- How many days pass between paying suppliers and collecting payment from customers.
Net debt
- What it tells you
- Financial debt minus available cash.
ROE
- What it tells you
- The return shareholders earn on the capital they have contributed.
ROCE
- What it tells you
- The return on all capital employed in the business, both equity and debt.
Break-even point
- What it tells you
- How much you need to sell to cover all costs without making a loss.
Operating leverage
- What it tells you
- How much profit changes when sales change, depending on the share of fixed costs.
Our method in 4 phases
- 01
Data. We extract and validate information from the ERP, banks and spreadsheets.
- 02
Analysis. We calculate KPIs and assess the balance sheet, income, cash flow and profitability.
- 03
Review with management. We discuss the results with you to identify the real causes, not just the symptoms.
- 04
30/60/90 plan. Actions prioritised by impact and effort, with named owners and milestones.
Results and the information we need
The aim is to identify the levers for margin and cash flow (product mix, pricing and efficiency) and gain monthly visibility of KPIs and variances.
- Executive report
- Excel/Power BI scorecard
- Risk checklist and quick wins
- Prioritised 30/60/90 plan
Information we will ask for: accounting journals, balance sheets, general ledgers, payment and collection schedules, customer and supplier lists, inventory, bank statements and a budget, if available.
What comes next: if you want to keep monitoring progress each month, the analysis becomes the starting point for our Management Control service, with close by D+10, a monthly committee meeting and fortnightly follow-up.
Frequently asked questions
Let’s talk about your numbers.
We help you understand where your company stands and what to do next.