Interpreting The Annual Report Of The Chengdu Railway Diversified Corporation

Financial statement is the most important way of learning listed companies for stakeholders. For example, equity investors make investment strategies and supervise return of inveatment through the information financial statements reflect; creditors confirm their debts’ security relying on it.This paper takes Chengdu Diversified Corporation as the research object and analyzes its financial reports from2007to2011. We have made a comprehensive analysis from various aspects, such as debt-paying ability, operating capacity, profitability, cash-creating ability, growth ability, working capital management ability and so on. We also select four other companies of Ministry of Railways diversified system as comparism of industry and distinguish its position of industry. Then we elaborate firm risk, and further analyze influence factors of profit margin on net assets using the Dupont analysis structure. Finaly, we combine non-financial information of financial reports from2007to2011to make some suggestions on its operating policies.The result shows that Chengdu Diversified Corporation faces with high debt-paying pressure, and its fluctuation level of profitability is high. Besides, its operational capacity level is low and cash creation ability is easy to be influenced by the macroscopical economic environment and policiesranks. But it still ranks top by comparism of industry. All in all, it has powerful development potential.