Using the ratios you have calculated in Question 6.3 for the three companies:

• Suggest reasons for the changes in profitability over the two years for all three companies.

• Evaluate the performance of the three companies from the point of view of the shareholders.

Data from Exercises 6.3

Extracts from the income statements (= statements of profit or loss), statements of financial position and notes to the financial statements for Bovis Homes Group plc (years ended 31 December 2017 and 31 December 2016, www.bovishomesgroup.co.uk/investors/reportsand- presentations), Persimmon plc (years ended 31 December 2017 and 31 December 2016, https://www.persimmonhomes.com/corporate/investors/results-presentations-and-financial- reports) and Crest Nicholson plc (years ended 31 October 2017 and 31 October 2016, https://www.crestnicholson.com/investor-relations/reports-results-and-presentations) are presented below. All three companies build residential housing in the UK.

None of the three companies had any preference shares in issue in either of the accounting periods shown above.

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Revenue Cost of sales Gross profit Operating profit Profit before tax Profit for the year Non-current assets Dividends for year (total) Average number of employees during the year Shares in issue (million) Houses sold in the year Bovis Homes Group plc 2017 £m 1,028.2 843.6 184.6 121.2 114.0 91.3 15.7 63.8 2016 2017 2016 £m £m 3,422.3 3,136.8 845.8 2,350.6 2,265.4 209.0 1,071.7 871.4 Persimmon plc £m 1,054.8 160.0 955.1 154.7 120.8 57.6 60.4 770.5 966.1 774.8 786.9 625.3 542.1 482.9 416.6 338.3 Crest Nicholson plc 2017 £m 1,043.2 768.3 274.9 211.6 207.0 168.6 110.0 84.3 2016 £m 997.0 731.2 265.8 203.8 195.0 156.8 118.7 70.3 2017 2016 2017 2016 2017 2016 Number Number Number Number Number Number 1,297 1,186 4,535 4,526 905 849 134.661 134.522 308.856 308.498 255.760 254.364 3,645 3,977 16,043 15,171 2,935 2,870