Finance Essay

2200 Words Apr 16th, 2013 9 Pages
Mining Industry
ATH Resources plc ATH Resources operates surface coal mines and is one of the largest producers of coal in the UK, providing coal principally to the electricity supply industry and also the industrial and house coal markets. Throughout the development and operation of its projects, ATH focuses on the restoration and rehabilitation of the sites and land is returned to a number of uses including agriculture, forestry, nature conservation and other forms of development. ATH Resources plc was listed on the Alternative Investment Market (AIM) in June 2004. In June 2005 the Group funded two new surface sites, Grievehill and Glenmuckloch in Scotland for 18 million by way of an Open Offer to shareholders.
In May 2006 the
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Therefore, how much the operating revenues will contribute to net profit depends on the efficiency with the company manages its expense and taxes. Thus NPM depends on the two ratios, expense control efficiency and tax management efficiency.
Above graph shows that, ATH Resources plc decreased heavily from 8.32% till -5.50% from the year 2007 to 2011. This shows that ATH resources plc’s sales increases rapidly but their other expenses also increased greatly.
Return on Asset

In 2007, the ROA of ATH Resources plc is 6.47%, which means every £100 worth of earning assets it generates £6.47 of net income. The ratio continuously Decreased during 2007 to 2010 from 6.47% to 2.58%, and again fell to -4.73% in 2011. Such low ROA ratio indicates poor performance of the management to generate income from assets.
Return on Equity

In the year 2007, the ROE of ATH Resources plc is 18.27% which means that the shareholders have earned £18.27 for every £100 invested.
From 2008 to 2010 there is a decrease in the company’s ROE and also it heavily fell in 2011 at -20.83%. This will create negative image of the company and the shareholders would find less interest to invest in the shares of ATH Resources.
Total Asset Turnover

In the year 2007, ATH resources plc’s total asset turnover is 77.81%. It means at £100 worth of assets ATH Resources plc generated £77.81 of sales.
From the year 2008 to 2011,

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