FINANCIAL ANALYSIS 5
have a wide scope of events that happen over duration of time. Perhaps the users are able to
identify a positive trend or those trends that trouble the company or the industry at large.
The horizontal analysis of Breedon Group PLC and TJ Corporation is used as a comparative
model company in analyzing the performance of Breedon Group PLC. Some very interesting
trends can be noted from the above analysis. The amount of dollar and the percentage of each of
the financial statement can be noted to have slightly dropped for Breedon Group PLC as
compared to the performance of TJ Corporation. In 2013, when the net sales revenue dropped by
1% of the base year, 2012, the net income dipped by a total of 10 % for Breedon GroupPLC.
While in 2016, the same company experienced a reduction of its sales revenue by 0.0004%, the
reduction on the net income also slightly reduced by 2%.
The same cannot be said of TJ Corporation which had a good run in 2013, with a significant
increase by 12% on the base year which subsequently reflected on its net income which
increased by 27% in the same year (LSE, 2017). For the year 2016, the same growth that was
experienced in the previous year was replicated on the performance. The overall net sales
increased by 6% and the general reflection on the sales were an increase by of the net income by
twice the percentage increment (LSE, 2017). Perhaps the reduction in sales for both corporations
for the year between 2013 and 2014 is an indicator of the turbulent trading period that the
industry faced during the period (LSE, 2017).
The horizontal analysis offers the best way to look at the individual aspects of the elements that
contribute to the reduction of the net income across the years (Financial Times, 2017). From the
Horizontal chart above, increment and decrease in such elements like operating expenses and
taxes do indicate what the industry might be undergoing through. For example high operating
expenses and taxes through the period between 2012 and 2016 might inform the users of the