COCA COLA VS PEPSI (PRESENTATION

)

By : USAID KHAN (MIS,ITM,ACMA,CISA)
(INTERNATIONAL ISLAMIC UNIVERISTY ISLAMABAD),
INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN(ICMAP)

Title of Project

Coca-Cola company vs Pepsi Company

Introduction To the Project
The project is that we have taken two companies Coca-Cola and Pepsi which are listed on the stock exchange. These are two very famous drink making companies all over the world. We have compared there annual financial statements for three years. And then we done a comparison between them. We have took their balance sheets, income statements, cash flow statements and statements of owner’s equity and find their ratios to done the correct comparison between them.

Objective and Significance
Through this project we want take their and on this basis of their ratio we want to compare them, that which of them is active to achieve their goals and which of them is still struggling to achieve the success. Significance are that through this project We become capable of finding the ratios and also we came to know that which of drink is more liked by people and this project will help us in our future life.

Data collection:
We have taken the financial statements of Pepsi from the website www.finance.yahoo.com We have taken the financial statements of Coca-cola from the website www.thecoca-colacompany.com Apart from this to get some more data we have searched from the search engines given bellow, www.google.com & www.wikipedia.com

Liquidity Ratio/Short Term Solvency Ratios:

Coca cola company Pepsi company
Year 2007 Year 2008 Year 2009 Year 2007 Year 2008 Year 2009

Current ratio

0.91

0.94

1.3

1.31

1.23

1.43

Quick ratio

0.75

0.77

1.11

1.14

1.0

1.13

Activity Ratios/Turnover Ratios/Efficiency Ratios: Coca cola company Pepsi company
Year 2007 Year 2008 Year 2009 Year 2007 Year 2008 Year 2009

Stock turnover period Debtor’s collection period Account payable period

87.6 days 78.7 days 87.21 days 122.9 days 86 days 111.2 days 90 days 139.23 days 88 days

50.14 days 96.10 days 56 days

48.78 days 90.57 days 55 days

51.58 days 91.09 days 56 days

Solvency Ratios:
Coco cola company
Year 2007 Year 2008 Year 2009

Pepsi company
Year 2007 Year 2008 Year 2009

Debt ratio

0.215

0.008

0.105

0.12

0.23

0.197

Debt equity ratio

0.99

0.98

0.96

1.00

1.97

1.37

Interest 10.68 cover ratio

17.14

25.2

34.07

21.41

20.35

Profitability Ratios:
Coca cola company
Year 2007 Gross 212.20 profit ratio Net profit ratio 64.71 Year 2008 214.84 57.23 73.93 28.36 14.33 Year 2009 214.5 69.29 9.80 27.52 14.02

Pepsi company
Year 2007 136.8 34.54 45.78 16.33 16.33 Year 2008 129.2 27.25 37.33 42.47 14.29 Year 2009 133.3 32.09 41.61 35.38 14.92

Operating 85.17 profit ratio Return on equity Return on asset 26.58 13.82

Shareholder’s Investment Ratios/Key Performance Indicators:
Coco cola company Pepsi company
Year 2007 Earning per ratio Dividend per ratio Dividend cover 2.51 1.36 1.91 Year 2008 2.59 1.52 1.65 Year 2009 2.95 1.64 1.80 Year 2007 3.48 1.35 2.58 Year 2008 3.26 1.65 1.97 Year 2009 3.81 1.78 2.14

Graphs of Liquidity Ratio/Short Term Solvency Ratios:

1). Graph of Current Ratios
1.5 1

Ratios 0.5
0

Ratios

Pepsi Co. Coca Cola Co. 2). Graph Quick Ratios

2007

2008
Years

2009

1.2 1 0.8 0.6 0.4 0.2 0
2007 2008 Year 2009

Pepsi Co. Coca Cola Co.

Activity Ratios/Turnover Ratios/Efficiency Ratios: 1). Stock Turnover Period 100 80 60 40 20 0
Years

Days

Pepsi Co. Coca Cola Co. 2007 2008 2009

2). Debtor’s Collection Period
150 100 Pepsi Co. Coca Cola Co. 2007 2008 2009
Years

4 3 2 1 0 2007 2008 2009 Coca Cola Co. Pepsi Co.

Days
50

0

Solvency Ratios: 1). Debt Ratio 0.25 0.2 0.15 Ratios 0.1 0.05 0 2007 2008 2009
Years

2). Debt Equity Ratio 2 Pepsi Co. Coca Cola Co.
Ratios

Pepsi Co. 1 0 2007 2008
Years

Coca Cola Co. 2009

3). Interest Cover Ratio
40

Ratios

20 0 2007 2008 Years 2009

Pepsi Co. Coca Cola Co.

Profitability Ratios:

1). Gross Profit Ratio
250 200 Ratios 150 100 50 Pepsi Co.

Coca Cola Co.

0
2007 2008 2009 Years 80 60 Pepsi Co. Coca Cola Co. 2007 2008 Years 2009 2). Net Profit Ratio

Ratios

40 20 0

3). Operating Profit Ratio 100 80 Ratios 60 40 20 Pepsi Co. Coca Cola Co. 2007 4). Return on Equity 2008
Years

0
2009 5). Return on Assets 17 16 15 14 13 12

50
40 30
Ratios Ratios

Pepsi Co.
Coca Cola Co. 2007 2008 2009
Years

Pepsi Co. Coca Cola Co.

20 10 0

2007 2008 2009
Years

Shareholder’s Investment Ratios/Key Performance Indicators: 1). Earnings per share 4

3
Ratios 2 1 0 2007 2008 2009
Years

Pepsi Co. Coca Cola Co.

2). Dividend Per Share 4
Ratios

3). Dividend Cover 3 Pepsi Co. Coca Cola Co. 2
Ratios

3

Pepsi Co. Coca Cola Co. 2007 2008 2009
Years

2
1 0 2007 2008 2009
Years

1
0