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Activity 11 - Vodafone total asset turnover ratio

Let's see what we find when we analyse Vodafone's total asset turnover ratio. Go to the database and find the data you need for these calculations then calculate the total asset turnover ratios and tell us what you have found.

Did you get this?

Did you think these were terrible results? Me too! Especially when we compare it with the Carphone Warehouse's results which were 1.56 and 2.57 for its latest two years respectively - significantly better than Vodafone's turnover ratio results.

History shows us Vodafone's total asset turnover ratio looks like this:

It's been terrible for three years now, but it might be that 2001 was the worst year.

This graph might help us to understand the underlying picture, too:

We can see now that Vodafone grew phenomenally quickly from 1999 to 2000 and although it is still a large company, it isn't growing at the same rate. Moreover, its assets have grown at a much quicker rate than its turnover. This could suggest that Vodafone is investing very heavily it its future. We would expect to see major improvements over the coming years just as we would for the Carphone Warehouse. We have to say, though, that Vodafone's total asset turnover ratio has never been that good.

Additional notes are available on advanced asset usage or you can move on to the Stocks, Debtors and Creditors section.

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