...Report on Capital Structure and the Cost of Capital of AstraZeneca Plc and British American Tobacco Plc. Table of Contents 1.0 Introduction………………………………………… 4 2.0 Background………………………………………… 5 3.0 Capital Structure…………………………………… 6 3.1 Debt to equity……………………………… 6 3.2 Long term debt to equity…………………... 7 3.3 Total debt to capital………………………… 7 3.4 Long term debt to capital…………………... 8 3.5 Balance sheet structure AZN………………. 9 3.6 Balance sheet structure BAT………………. 10 3.7 Discussion…………………………………. 10-11 4.0 Cost of capital……………………………………… 12 4.1 Introduction………………………………... 12 4.2 Weighted average cost of capital………….. 12 4.3 Dividend growth model…………………… 12-14 4.4 Capital asset pricing model………………... 14-16 4.5 Discussion…………………………………. 16-17 5.0 References…………………………………………. 18 6.0 Link to excel workbook……………………………. 18 Capital Structure and the Cost of Capital 1.0 Introduction This report provides financial analysis of two top publicly traded companies from very different sectors. AstraZeneca Plc(AZN) and British American Tobacco Plc(BAT). The structure of the report will be aimed at meeting the objectives of the brief: Empirical observation Comparative analysis Impact of industry conditions Economic environment Business environment For consistency of information all the data used, unless otherwise stated, is obtained from ThomsonONE. ...
Words: 2834 - Pages: 12
...presence of British American Tobacco in this part of the world can be traced back to 1910. Beginning the journey as Imperial Tobacco 100 years ago, the Company set up its first sales depot at Armanitola in Dhaka. After the partition of India in 1947, our company was established in 1949. It then became Bangladesh Tobacco Company Limited in 1972 immediately after Bangladesh’s independence. In 1998, the Company changed its name and identity to British American Tobacco Bangladesh Company Ltd. Our shareholders We were one of the first companies listed on Dhaka and Chittagong stock exchanges. The British American Tobacco Group holds 65.91% of the shares in British American Tobacco Bangladesh. Other shareholders are the Investment Corporation of Bangladesh, Shadharan Bima Corporation, Bangladesh Shilpa Rin Shangstha, Government of People’s Republic of Bangladesh, Sena Kalyan Shangstha and other members of the public. Our contributions British American Tobacco Bangladesh is one of the largest multinational companies in Bangladesh. Consequently, we are also the largest private sector tax payer in Bangladesh. In 2010, we contributed Tk 46.27 billion in the form of Supplementary Duty, Value Added Tax (VAT) and other taxes to the national exchequer. Over time, we have successfully established ourselves as the company contributing to economic, social and human resource development. We continue to move forward to deliver higher promises. Our beliefs At British American Tobacco Bangladesh...
Words: 938 - Pages: 4
...A. What stakeholders are affected by the U.S. tobacco industry's production and marketing of cigarettes? What stakeholder interests are impacted? How does the tobacco industry prioritize these stakeholders? Do you agree with the tobacco industry's prioritization? Why or why not? According to Wikipedia, a stakeholder is defined as a person, group, organization, member or system who affects or can be affected by an organization’s actions. There are several stakeholders that have been affected by the U.S. tobacco industry’s production and marketing of cigarettes. The retail tobacco companies are one such group that is undoubtedly affected by the developments affecting the production and marketing of cigarettes. Companies like Phillip Morris USA, Inc., RJ Reynolds Tobacco Company and British American Tobacco Limited who are interesting in profit maximization and return on investment felt that they were unfairly targeted by the imposition of restricted marketing activities and efforts to reduce the consumption of cigarettes. The tobacco companies believe that the law is excessive and will result in an increase in the cost of modifying packages and inversely, a reduction in net profit. The state (government) is also affected by the issues surrounding the tobacco industry. The government is faced with a slight dilemma because they are the regulator of the industry and the product is a legal product which is known to be harmful to both smokers and non-smokers. The industry also contributes...
Words: 1518 - Pages: 7
...organization of your choice We choose tobacco industry for our assignment is because of the simplicity of the nature of its product and its global reach. Tobacco is an agricultural commodity product which is also a widely-used addictive substance. The tobacco industry is one of the most powerful international commercial industries in the world. The price of tobacco varies by the total quantity on the market ready for sale, the area where it grows and the quality of products. It is often heavily taxed to gain revenues for governments and as an incentive for people not to smoke. British American Tobacco (BAT) formed in 1902 as a joint venture between the UK’s Imperial Tobacco Company and the American Tobacco Company founded by James ‘Buck’ Duke. The business has operated for more than 100 years it is the world’s second largest quoted tobacco group by global market share (Earthwatch). It holds robust market positions in each of its regions and has leadership in more than 15 million retail outlets throughout the world. Yet, Philip Morris is the main competitor of BAT. The Chairman of BAT is, Richard Burrows on 1 November 2009. Then, the Chief Executive Officer, Nicandro Durante in March 2011 and John Daly was appointed to the role of Chief Operating Officer in September 2010. Ben Stevens was appointed Finance Director in April 2008. In September 2010, he took on the additional role of Chief Information Officer (British American Tobacco). One of the reasons that BAT to be able...
Words: 1099 - Pages: 5
...Ethical Dilemma - Tobacco Industry A. What stakeholders are affected by the U.S. tobacco industry's production and marketing of cigarettes? What stakeholder interests are impacted? How does the tobacco industry prioritize these stakeholders? Do you agree with the tobacco industry's prioritization? Why or why not? According to Wikipedia, a stakeholder is defined as a person, group, organization, member or system who affects or can be affected by an organization’s actions. There are several stakeholders that have been affected by the U.S. tobacco industry’s production and marketing of cigarettes. The retail tobacco companies are one such group that is undoubtedly affected by the developments affecting the production and marketing of cigarettes. Companies like Phillip Morris USA, Inc., RJ Reynolds Tobacco Company and British American Tobacco Limited who are interesting in profit maximization and return on investment felt that they were unfairly targeted by the imposition of restricted marketing activities and efforts to reduce the consumption of cigarettes. The tobacco companies believe that the law is excessive and will result in an increase in the cost of modifying packages and inversely, a reduction in net profit. The state (government) is also affected by the issues surrounding the tobacco industry. The government is faced with a slight dilemma because they are the regulator of the industry and the product is a legal product which is known to be harmful to both smokers...
Words: 319 - Pages: 2
...Study of British American Tobacco Bangladesh. [pic] PART – 2 Introduction to the Study 2.1 Rationale Supply Chain Management Department of British American Tobacco Bangladesh Ltd vision is to be the best Supply Chain Management department in Bangladesh. . It’s vital to ensure our supply chain is fit for purpose for the long term. Importantly our approach covers both our own operations and our wider supply chain... To me it’s clearly good business, as well as good stewardship. Supply chains have always needed to be flexible and agile. But there are increasing pressures to adapt faster than before: climate change, more competition and demand for greater business growth, to name a few. The anticipated growth in demand for agricultural products is particularly relevant for us. As the global population expands and economic development generates more disposable incomes, there will be increased competition between crops for energy, land and water. We also expect business to play a greater role in addressing social and environmental issues, through influence and public-private partnerships. 2.2 Background (Description of the Organization/Company): The British American Tobacco Group is one of the world’s leading international manufacturers of cigarettes, marketing its products in almost every country worldwide. It is clear leader in a competitive and fast moving business. British American Tobacco, the second largest Tobacco Company...
Words: 4577 - Pages: 19
...the individual will be the person hurt by the knick-knacks of the business. Is this fair to the public? No it is not and solutions to the problem must be addressed to ensure this act does not regulate into a long turn advantage for the tobacco companies. The importance of competition among firms is so that companies can give consumers a choice for a certain product. Governments intervene in these markets to ensure that the quality of the product and safety to the consumer is acceptable to purchase (Federal Trade). In many of the government reports they, regulate the behavior of industries to insure prices and excessive profits that are not highly rated in a disadvantage to the consumer. Businesses look for many ways to catch the consumers’ eye such as: brand name, trade mark, slogan, or catch phrase, to name a few. These advertisements swindle age groups of society to try out this harsh product despite if the major medical health concern is cancer. Many firms are out for themselves and how they can prosper within their industry and those small like consumers known as farmers have to settle for the less but yet complicated act of the big dog industry. Competitive environments do not benefit the society concerning the tobacco company. Farmers for instance, worked hard to produce a product for a living and the industry took the product paying the seller at a lower rate and made the item into something larger. By doing this format of sly but acknowledgeable...
Words: 830 - Pages: 4
...Overview B ritish American Tobacco is a British multinational tobacco company headquartered in London, United Kingdom. It is the world’s second-largest quoted tobacco company by market share (after Philip Morris International), and has a leading position in over 50 countries and operations in more than 180 countries. Its brands include Dunhill, Kent, Lucky Strike and Pall Mall. BAT has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. As of 26 December 2011 it had a market capitalization of £59.2 billion, the sixth-largest of any company listed on the London Stock Exchange. It has a secondary listing on the Johannesburg Stock Exchange. They are leading more than 50 countries and have their presence in more than 180 countries with approximately 50,000 employees. BAT is committed to providing consumers with pleasure through excellent products, and to demonstrating that they are meeting their commercial goals in ways that are consistent with reasonable societal expectations of a responsible tobacco group in the 21st century. BAT is designed to deliver their vision and build shareholder value. It is based on growth, funded by productivity and delivered by a winning organization that acts responsibly at all times. History Born international O n 29 September 1902 the UK’s Imperial Tobacco Company and the American Tobacco Company of the United States form a joint venture, the British American Tobacco Company, in a bid to end...
Words: 5892 - Pages: 24
...___________________________________________________________ 9 How the Business was formed Articles and By Laws of Corporation ____________________________________________ 10_ Advantages and Disadvantages of Business _______________________________________ 12 Detains of number and types of product __________________________________________ 15 Industry Analysis Major Competitors __________________________________________________________ 17 SWOT Analysis ____________________________________________________________ 19 Conclusion ________________________________________________________________ 21 References _________________________________________________________________21 Executive Summary Bangladesh is Asia Pacific’s most promising opportunities for Tobacco cultivation due to vast cultivable lands and suitable weather. BAT symbolizes a name - a state of mind. From the beginning, it has today burgeoned into...
Words: 3067 - Pages: 13
...Ceylon Tobacco Company PLC | Organizational Culture | | Table of Contents Executive summary ……………………………………………………………………………….……………………………………………………….…..1 Introduction ………………………………………………………………………………………….………………………………………………………….…2 Company history ……………………………………………………………………………….………………………………………………………….…2 Type of business ……………………………………………………………..……………….…………………………………………………………….2 Management and Staff ……………………………………………………………………………………………………………………………………….3 Organization culture and characteristics …………………………………………………………………………………………………………….3 As a team ………………………………………………………………………………………………………………………………………………………5 Organization culture and performance ……………………………………………………………………………………………………………….5 Sustaining its culture …………………………………………………………………………………………………………………………………….6 How employees learn about organizational culture …………………………………………………………………………………………….6 Conclusion …………………………………………………………………………………………..………………………………………………………………6 References …………………………………………………………………………………………………………………………………………………………..7 Executive Summary Ceylon Tobacco Company is one of Sri Lanka’s most successful businesses and it caters to a wide set of crowd from age 21 and above in Sri Lanka, Maldives and Middle Eastern countries. It has being a distinctive member of British American Tobacco Company and operations span from the growing and processing of Tobacco to distribution and marketing of cigarettes. By being the solitary tobacco products producer, CTC’s unique...
Words: 1924 - Pages: 8
...British American Tobacco Financial Assessment (2011-13) Executive Summary Prepared by the Devon Fund Managers, this reports provides recommendation to the potential investors with regard to investing actions in British American Tobacco PLC. In this report, it is concluded that BAT performs superior to its competitors in most parts of the financial performance, with a strong focus on innovation, on emerging opportunities of new markets and new products. On the basis of the analysis and interpretation of company’s financial ratios, Devon Fund Managers recommend that purchasing BAT shares, which is a well-positioned company in the global market with strong international brands, is a sensible decision. The current shareholders on the other hand, may prefer to preserve their ownership, because the company commits strong future performance based on new investments. Contents 1. Introduction 2. Industry Overview 3. Ratio Analysis 3.1. Table of Ratios 3.2. Profitability 3.3. Efficiency 3.4. Liquidity 3.5. Financial Structure 4. Recommendation 5. Bibliography 6. Appendices 1. Introduction This report aims at providing potential investors with an overall financial review of the company and giving recommendations for future actions. The financial assessment will be conducted through the analysis of some key ratios of BAT from 2011 to 2013,...
Words: 2008 - Pages: 9
...Corporate Social Responsibility (CSR). The field of responsible business practice is one of the most dynamic and challenging subjects corporate leaders face today. It is argued that socially responsible behaviour can pay off in the long run, even where it involves some short-term sacrifice of profit. CSR has been pioneered over the last two decades by the oil, chemical and tobacco industries due to their attempt to win back social respectability by changing their image. In this report, shall discuss how British American Tobacco plc (BAT), as one of the biggest tobacco companies in the world, allows their businesses to manage the economic, social and environmental effect of their operations to maximise the benefits and minimise the problems. The tobacco industry contributes largely to the economies of over 150 countries, and there are more than 100 million people all over the world dependent on them for employment, which is more than 20 times the population of Singapore. Taxes for the tobacco industry are the main foundation of revenue for almost every government in the world. This revenue gathered from the tobacco company is then used by the government...
Words: 2159 - Pages: 9
...PAPER ON RJ REYNOLD’s AMERICAN BACKGROUND HISTORY Reynolds American, the second-largest tobacco company in the United States was formed in January 2004 and began trading publicly on the New York Stock Exchange as RAI in August 2004. Reynolds American is also known as the parent company of American Snuff Company (formerly Conwood Company, LLC), Santa Fe Natural Tobacco Company, Inc., and Niconovum AB. This company has approximately 28 percent of U.S. cigarette sales. The company offers products in all segments of the market and makes many of the nation's best-selling cigarette brands, including: Camel, Pall Mall, Kool, Winston, Salem and Doral. In 1913, Reynolds Tobacco introduced Camel cigarettes, containing a blend of several different types of tobacco, a blend that would come to be called “the American blend.” Supported by a unique introductory advertising campaign, Camel became the first nationally popular cigarette in the United States. Reynolds Tobacco established virtually every packaging standard in the U.S. cigarette industry. The 20-cigarette pack was introduced by Reynolds Tobacco in 1913, and in 1915 the company introduced the one-piece, 10-pack carton. In 1931, Reynolds Tobacco became the first company to package its cigarettes with a moisture-proof, sealed cellophane outer wrap to preserve freshness. In 1918, Richard Joshua Reynolds – Reynolds Tobacco’s founder – died at the age of 68. In 1925, Brown & Williamson purchased J.G. Flynt Tobacco Co. and its trademarks...
Words: 1278 - Pages: 6
...Practices in British American Tobacco Bangladesh Submitted to …. Lecturer, Dept. of Business Administration Submitted by Name: ID: Course Code: HRM360 Course Title: Human Resource Planning Submission Date: 31 August, 2014 Atish Dipankar University of Science and Technology Executive Summary: This assignment looks in to how Human Resource Planning is practiced in British American Tobacco (BAT), Bangladesh. This paper reflects on their overall human resource management and planning activities. While doing that their selection process, training and development methods, performance appraisal, employee compensation etc are also discussed. This paper will help one to get an idea on how HR planning is observed in multinational companies in Bangladesh, as BAT is one of the prominent ones. Table of contents: 1. Introduction | Page 1 | 2. Objective | Page 1 | 3. Methodology | Page 1 | 4. Brief Description of BAT | Page 2 | 5. Human Resource Planning | Page 2 | 6. Recruitment Policy | Page 2 | 7. Selection Process | Page 3 | 8. Training and Development | Page 3 | 9. Employee Training Method | Page 4 | 10. Employee Development Method | Page 4 | 11. Performance Appraisal | Page 5 | 12. Compensation | Page 6 | 13. Establishing Pay Rates | Page 6 | 14. Benefits | Page 7 | 15. Conclusion | Page 7 | Introduction British American...
Words: 2074 - Pages: 9
...|561.50 | |29 |Lloyds Banking Group / 劳埃德银行集团 |银行业 |1066.66 |45.67 |16507.79 |502.47 | |46 |Vodafone / 沃达丰 |电信服务 |583.46 |43.78 |2179.68 |1122.61 | |68 |Rio Tinto / 力拓 |材料 |418.25 |48.72 |950.05 |1183.36 | |71 |GlaxoSmithKline / 葛兰素史克 |医药与生物技术 |458.29 |89.35 |653.82 |953.61 | |84 |Tesco / 特易购 |食品市场 |779.44 |31.00 |656.12 |514.34 | |99 |Standard Chartered Group / 渣打银行集团 |银行业 |209.41 |33.80 |4355.57 |461.61 | |100 |AstraZeneca / 阿斯利康 |医药与生物技术 |328.04 |75.21 |536.28 |635.55 | |122 |Aviva / 英杰华集团 |保险业 |959.77 |17.52 |5597.09 |155.09 | |129 |Prudential / 保诚集团 |保险业 |776.73 |11.14 |3614.99 |200.51 | |133 |British Amer Tobacco / 英美烟草 |食品、酒类及烟草 |229.53 |43.83 |424.12 |682.66 | |138 |Anglo American / 英美集团 |材料 |211.56 |24.60 |567.96 |481.89 | |156 |BG Group / 英国天然气 |石油及天然气 |164.99 |35.02 |423.04 |581.64 | |186 |National Grid / 英国国家电网 |公用事业 |222.25 |13.43 |635.40 |242.38 | |194 |Imperial Tobacco Group/ 帝国烟草公司 |食品、酒类及烟草 |235.97 |10.61 |508.23 |319.37 | |215 |Diageo / 帝亚吉 |食品、酒类及烟草 |153.39 |26.71 |286.95 |409.35 | |217 |Centro Properties Group / 中央地产集团 |公用事业 |343.93 |13.22 |313.95 |216.84 | |220 |SABMiller / 南非米勒酿酒 |食品、酒类及烟草 |148.83 |18.81 |314.58 |424.47 | |257 |Legal & General Group / 法通保险 |保险业 |707.09 |13.94 |4796.45 |64.11 | |283 |Rolls-Royce Group / 劳斯莱斯集团 |宇航国防 |168.24 |35.88 |243.23 |155.68 | |340 |Reckitt Benckiser Group/ 利洁时 |家用及个人消费品 |125.25 |22.91 |137.91 |376.37 | |378 |WPP / WPP集团 |传媒 |140.23 |7.07 |359.83 |116.45 | |385 |Royal Bank of Scotland / 苏格兰皇家银行 |银行业 |950.17 |-58.24 |27279...
Words: 1178 - Pages: 5
