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Electric Game Plc is an energy company, providing energy throughout the West Midlands. During the year ended 31 March 2021, Electric Game acquired all the

Electric Game Plc’ is an energy company, providing energy throughout the West Midlands. During the year ended 31 March 2021, Electric Game acquired all the operations of ‘Squid energy’ together with all their customers as the company went into Administration. Below are the income statements, extracts from the statements of financial position and extracts from the notes to the financial statements for ‘Electric Game plc’. for the financial years ended 31 March 2022 and 31 March 2021.

2022

2021

£m

£m

Revenue

3,462

2,394

Cost of sales

2,570

1,591

Gross profit

892

803

Administration expenses

201

264

Operating profit

691

539

Finance income

1

1

Finance expense

100

84

Profit before tax

590

454

Income tax

42

32

Profit for the year

548

422

Non-current assets

2,400

1,640

2022

2021

Number

Number

Employees: average during the year

406

254

Number of subscribers (millions)

862

556

  1. Calculate the following ratios for 2022 and 2021 for ‘Electric Game plc’
  1. Gross profit percentage
  2. Operating profit percentage
  3. Profit before tax percentage
  4. Profit after tax percentage
  5. Non-current asset turnover
  6. Revenue per employee
  7. Operating profit per employee
  8. Any other ratios you consider to be relevant to an assessment of the profitability of ‘Electric Game plc’

2. Evaluate the changes in profitability for ‘Electric Game plc’ between 2021 and 2022, analysing reasons for the changes in profitability in 2022.

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