Financial Analysis of Matalan and House of Fraser

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Investment Analysis Matalan & House of Fraser Introduction In this essay I would like to elaborate on the investment analysis of two companies, open a space of possibilities in discourse and practices in order to determine which of the two companies to invest in. The essay will commence with a brief overview of the two companies that are being considered. The latter part of the essay will explain and critique the financial position of the two companies and also the strategy and structure of the organization. For this purpose different financial tools will be used. The conclusion will be description and reasons for the company chosen to invest. Company overview Matalan Plc is quoted to the FTSE 250 with a current market capitalization of £695.83M. The Group is an out of town retailer, which it distributes its products straight from the manufacturer. The company operates a chain of 143 retail stores, covering the United Kingdom and its main product range consists of clothing and footwear for ladies, men and children, as well as furnishings for home. Some famous brands that the Group is trading include Wrangler, Wonderbra, Falmer, Wolsey. In 2003 the Group's UK clothing market share was 3.1% increased by 0.3% compared to 2002 and Matalan is now the UK'S fifth largest clothing retailer by value and third largest by volume. Matalan plc now has over 9.1 million active members (an increase of 11%), while its store estate in 2003 has increased from 143 to 163. Its total trading space is up 22% to 4.5 million sq ft, while its average store size is up 8% from 25,578sq ft to 27,695 sq ft. The Group's strategy focuses on six key areas, in order to improve the operational effectiveness of its business. By a... ... middle of paper ... ...etter to invest in a stable firm like House of Fraser than a firm that has a fluctuating trend like Matalan. Reference 1) Management accounting Ray H. Garrison, Eric W. Noreen, Willie Seal European edition London McGraw Hill 2002 Managing Financial Resources- Michael Broadbent and John Cullen rd edition Oxford: Butterworth- Heineman 2003 Financial reporting Practical element R. J. Kirk rd edition CIMA 1996 Financial statement analysis: theory, application and interpretation / Leopold A Bernstein and John J. Wild 6th edition Mc Graw Hill 1998 Annual Report of Matalan Annual Report of House of Fraser www.hemscott.com www.fame.bvdep.com www.matalan.com www.houseoffraser.com

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