MMGT6016
Financial Management
Intensive, September 2023
MMGT6016 Individual Assignment 2
1
Requirements Part A (Treat as Separate to Part B)
Following on from your initial report on JB Hi Fi (ASX code: JBH), executive management has asked
you to investigate its business units (BUs) of: JB Australia, JB New Zealand, and The Good Guys.
Management has asked you to provide recommendations on "which business units it should prioritise
for further investment, and which should it deprioritize, including any that it should potentially exit
from."
FULL YEAR FY22 $m
JB AUS
JB NZ
TGG
JBH
Consolidated
Revenue 6,196.5 246.1 2,789.4 9,232.0
Net Operating Profit (EBIT) 544.9 8.3 241.4 794.6
Profit Before Tax 534.0 7.9 234.0 775.3
Tax 230.4
Profit After Tax 544.9
Balance sheet
Segment Assets 1,574.4 51.2 1,879.3 3,161.4
Segment Liabilities 1,526.8 33.4 664.4 1,881.1
Segment Equity 47.6 17.8 1,214.9 1,280.30
Using available BU (segment) financial information for the full year to June 2022 and June 2021, you
need to submit a report containing the following:
1. A Du Pont ratio analysis of 2021-2022 and 2020-2021 focusing on BU performance given the
financial information provided by the company.
2. Factors relevant to the decision that management is considering other than the Du Pont
analysis. This may include important macro-environmental and industry trends affecting the
competitive environment that the JBH BUs operate in. You will need to support your
arguments with research and evidence drawn from recent industry reports, media articles and
other relevant publications.
3. In your recommendations, be clear in terms of what you are recommending and why, drawing
on your earlier analysis in Questions 1 and 2 above.
2
Requirements Part B (Treat as Separate to Part A)
Executive management are very interested in efficiencies and have asked you for some analysis of its
Group Costs. The FY2024 Group Costs that relate specifically to its Business Units are forecast to be
$1,400m. These comprise of:
• Sales and marketing costs of $1,050m, which is driven by the number of advertising
campaigns by each BU.
• Occupancy costs of $368m, which is driven by the rental m2 occupied by each Business Unit.
• Administrative costs of $53m, which is driven by the number of full-time employees (FTE)
employees employed by each BU.
Management has also provided you with the following forecast information in relation to 2024:
FY24 FORECAST $m
JB AUS
JB NZ
TGG
JBH
Consolidated
Sales Revenue $7,156.96 $284.25 $3,221.76 $10,662.96
Net Operating profit / EBIT $629.36 $9.59 $278.82 $917.76
FTE Employees 8,733 436 4,657 13,825
Occupied m2 396,057 18,368 148,166 562,590
Number of advertising campaigns 55 4 27 86
Write a note to management outlining what the above data indicates for the relative resource
consumption of group resource costs by the BUs and their consequent profitability.
Assignment Submission and Due Dates
Please compile your assignment as a single PDF file and submit it using the Turnitin function on
Canvas by the due date.
The deadline for online submission of this assignment is 11:00 pm, 15 September 2023.
Additional Information
Include in your main text relevant tables and figures containing results of your ratio analysis. Your
report should also contain an executive summary and a list of references of sources that are cited in
the report.
Please keep appendices to a minimum – containing supporting rather than primary information.
The word limit of 1,500 words excludes the executive summary, reference list and appendices.
Financial information sources
You will need to refer to the JB Hi Fi website for their financial information.
https://investors.jbhifi.com.au/annual-reports/
Specifically look for the Financial Report for full year 2022 and 2021 Financial Year Annual Report
and search for ‘segment information’.
Assessment Rubric
Please see overleaf
3
Assessment Rubric
Assessment
Criteria
High Distinction Distinction Credit Pass Fail
Application of
ratio analysis
Demonstrate excellent
and complete application
of financial ratio analysis
and thorough knowledge
about its uses and
limitations.
Demonstrate very good and
complete application of
financial ratio analysis and
good knowledge about its
uses and limitations.
Demonstrate good
application of financial
ratio analysis, although
minor errors/gaps exist,
and good knowledge
about its uses and
limitations.
Demonstrate correct
application of financial
ratio analysis, although
errors/gaps exist, and
adequate knowledge
about its uses and
limitations.
Demonstrates
predominantly incorrect
application of financial
ratio analysis and
insufficient knowledge
about its uses and
limitations.
Use of research
to support
arguments
Utilises a diverse range of
sources that provide
excellent support for
arguments.
Utilises a diverse range of
sources that provide strong
support for arguments.
Utilises a range of
sources that provide
good support for
arguments.
Utilises a minimum
number of sources that
provide some support for
arguments.
Utilises no sources to
support arguments.
Quality and depth
of the analysis
Demonstrates excellent
quality and in-depth
critical analysis. Shows
outstanding depth of
insight and well
synthesised conclusions
and/or recommendations
(where appropriate).
Demonstrates very good
quality and in-depth critical
analysis. Shows
considerable depth of
insight and synthesised
conclusions and/or
recommendations (where
appropriate).
Demonstrates good
analysis. Shows some
depth of insight and
attempts to synthesise
conclusions and/or
recommendations
(where appropriate).
Demonstrates reasonable
analysis. Presents
conclusions and
recommendations (where
appropriate) with limited
attempts at synthesis.
Demonstrates basic or
limited analysis,
conclusions and/or
recommendations (where
appropriate).
Written
communication
and presentation
The writing is clear,
concise, and free of
errors. The work is
extremely well structured
and presented.
The writing is clear, concise
and generally free of errors.
The work is well structured
and presented.
The writing is clear,
concise with limited
errors. The work is well
structured and
presented.
The writing is sound with
some error. The work is
adequately structured and
presented.
The writing is unclear with
frequent errors. The work
is poorly structured and
presented.