Kraft Foods Group Inc. (NASDAQ:KRFT)

The analysis of the financial ratios over the three-year period reveals certain stability as well as fluctuations in asset utilization and equity turnover for the company.

Net Fixed Asset Turnover

The net fixed asset turnover ratio remained relatively stable across the three years with values of 4.36, 4.43, and 4.34 respectively. This suggests a consistent efficiency in generating sales from fixed assets, although a slight increase in 2013 was followed by a minor decline in 2014, indicating a stable yet slightly fluctuating fixed asset utilization.

Total Asset Turnover

The total asset turnover ratio exhibited no change during the period, maintaining a constant value of 0.79 throughout the three years. This consistency indicates that the company maintained steady effectiveness in using its total assets to generate revenue over time without significant improvement or deterioration.

Equity Turnover

The equity turnover ratio showed more pronounced variability, starting at 5.13 in 2012, dropping substantially to 3.51 in 2013, and then partially recovering to 4.17 in 2014. This fluctuation suggests that the company’s ability to generate revenue from shareholders’ equity declined sharply in 2013 but improved in the following year, reflecting possibly changes in equity financing or operational efficiency impacting equity utilization.

Net Revenues

The net revenues exhibited a slight decline over the three-year period, starting at 18,339 million US dollars in 2012 and marginally decreasing to 18,218 million in 2013, followed by a negligible further decrease to 18,205 million in 2014. This trend indicates a relatively stable revenue base with minimal downward pressure.

Property, Plant and Equipment, Net

The net value of property, plant, and equipment showed a minor fluctuation. It decreased from 4,204 million US dollars in 2012 to 4,115 million in 2013, before increasing again to 4,192 million in 2014. This suggests a relatively steady investment in fixed assets with minor adjustments across the years.

Net Fixed Asset Turnover Ratio

The net fixed asset turnover ratio remained relatively stable, with a slight increase from 4.36 in 2012 to 4.43 in 2013, followed by a small decrease to 4.34 in 2014. This indicates consistent efficiency in utilizing fixed assets to generate revenue, despite minor year-on-year variations.

Net Revenues

Net revenues remained relatively stable over the three-year period, showing a slight declining trend from 18,339 million US dollars in 2012 to 18,205 million US dollars in 2014. The decrease between 2012 and 2013 was minimal, with revenues dropping by 121 million US dollars, followed by an almost negligible decline of 13 million US dollars from 2013 to 2014.

Total Assets

Total assets also exhibited a modest downward trend, decreasing from 23,329 million US dollars in 2012 to 22,947 million US dollars in 2014. This represents a total reduction of 382 million US dollars over the three years, with a steady decrease each year.

Total Asset Turnover

The total asset turnover ratio remained constant at 0.79 throughout the observed period. This indicates a stable efficiency in the use of assets to generate revenues, with no observed improvement or deterioration in asset utilization.

Summary

The data shows a stable revenue base with a slight downward trajectory alongside a modest decrease in asset base. Despite the reductions in total assets and revenues, the constancy of the total asset turnover ratio suggests the company maintained consistent efficiency in leveraging its assets to generate sales. There are no significant fluctuations or anomalies in the key financial metrics over the three years, indicating steady operational performance.

Net Revenues

Net revenues remained relatively stable over the three-year period, with a slight decline from 18,339 million US dollars in 2012 to 18,218 million in 2013, followed by a marginal decrease to 18,205 million in 2014. This suggests a period of revenue stagnation with negligible variation.

Equity

Equity experienced a notable increase from 3,572 million US dollars in 2012 to 5,187 million in 2013, representing a significant growth of approximately 45%. However, in 2014, equity declined to 4,365 million, indicating a reduction from the previous year's peak but still above the 2012 level. This fluctuation may reflect changes in retained earnings, capital injections, or shareholder distributions during the period.

Equity Turnover

The equity turnover ratio, which measures the efficiency in generating revenues from equity, declined from 5.13 in 2012 to 3.51 in 2013, signaling a reduction in operational efficiency relative to equity base. In 2014, the ratio increased to 4.17 but did not return to the 2012 level, implying a partial recovery in how effectively equity generated revenues.

Overall Insights

The data indicates that while net revenues remained stable, equity rose significantly in 2013 before decreasing in 2014, affecting the equity turnover ratio negatively in 2013 with some recovery afterward. The decline in equity turnover suggests that the company was less efficient at converting equity into revenues in 2013, possibly due to the enlarged equity base. The partial rebound in 2014 may indicate improved utilization of equity resources, but overall efficiency remained lower than in 2012.