Financial Analysis Of Construction Industry Between China And Egypt

It is well recognized that construction firms encounter risk and are sensitive to trends and volatility in the business environment.Measuring the financial performance of a firm serves as the basis for monitoring and evaluating its management competence,resource allocation,and corporate strategy in response to environmental change.Forecasting is paramount in responding to potential problems and perpetuating positive developments that result in sustainable competitiveness.Notwithstanding that,little research attention has been paid to this premise conceptually and empirically.Thus,the overall aim of this study was to model and forecast the general financial performance of Orascom construction company and China state construction engineering under the dynamic influence of the business environment.The research would provide useful information for better strategic decisions in organizations to positioning them within the industry with improved performance.The findings give the recommendation for firms to improve performance through understanding the efficiency resources and effectiveness of their strategies.In this research,financial ratio analysis has been conducted regarding profitability ratios,liquidity ratios,leverage ratios,activity ratios,cash flow ratios.The data were taken from annual reports of Orascom construction company and the financial statements of the China state construction engineering company.The studied years were 2006-2015,The ten years were chosen because these are the last years and last information about these two companies the researcher can find.This paper presents a review of literature of performance measurement in various industries with the aim of transferring best practice into construction.A framework is presented which ensures that effective strategies are deployed to form the performance management system that construction organizations can adopt,so it rationalizes the relationships between performance measures and goals derived from strategy.In doing so,the impact of those measures on an organization's performance can be examined and analyzed to indicate potential improvement areas.It is concluded in the study that profitability is the performance indicator of companies.A General profitability trend in the construction industry may be negated by well performed operational activities,which minimizes the direct cost and increases the profitability.China state in the study has proved that well-operated assets can bring good profits to the company.Liquidity ratios have been analyzed to adjudge the company's capability to meet its current liabilities within existing stream of current assets.Desirable liquidity ratio of(1.5-2 times)is a good indicator of a company's position and the sample chosen companies are meeting the standards of the desirable liquidity ratio.The constructed model in this research is Comparative Company Analysis model thismodel depends on comparing the two companies of the same industry to evaluate its performance and to find the mistakes to practice the performance,and it will mix with DuPont analysis model to help the researcher make sure about the developed model and its results.The final outcome of current research is a performance grade,which provides the performance of a construction company.The developed model is validated,which shows robust results.