Research On M Company's Profitability Based On DuPont Analysis System

Profitability is an important aspect of enterprise performance activity,profit ability research in the study of enterprise performance occupies a very important position,dupont analysis system is a kind of comprehensive financial analysis methods,which can realize to the enterprise operating results and financial position,and so on multi-dimensional comprehensive evaluation of the enterprise's profitability.Dupont analysis system is a financial analysis system that takes the return on net assets of an enterprise as the core analysis index.In the evaluation process,the return on net assets is firstly decomposed into three major items,namely,the net interest rate on sales,the total asset turnover rate and the equity multiplier.On this basis,combined with the relationship between the financial indicators,and then further decompose the above three major indicators,so as to quickly find the existing problems,further improve the company's financial structure,improve the company's operation level.Guided by the theory of profitability,this paper takes M company,a commercial retail enterprise,as the research object,and uses literature research,comparative research,case analysis and other research methods to conduct in-depth analysis and research on the case by combining theory with practice.Based on a comprehensive financial analysis method--dupont analysis system as the theoretical basis,this paper finds out the reasons affecting the profitability of the enterprise,analyzes the profitability of M company,seeks for the strategic and operational factors affecting its profitability,and puts forward countermeasures and Suggestions to improve its profitability.Through longitudinal analysis of the data of M company's annual report from 2013 to 2017 and industry comparison,it is found that although M company's profitability has strong stability,it has poor sustainability and weak durability.On this basis,the author adopts the dupont analysis system again to carry out a deeper analysis of the factors affecting the profitability of M company,and finds that there are some problems in the use of period expenses and financial leverage of M company.The analysis also shows that at present,M company has many problems in operation and management and development,such as poor cost control during the period and insufficient use of financial leverage.In view of the problems found,this paper proposes several solutions,such as optimizing the capital structure,strengthening the period cost control management,etc.,in order to provide effective reference andinspiration for M company and similar enterprises to improve the level of financial management.