My Top 3 Blogs!

This was a difficult task; out of the hundreds of students that are doing this course I had to pick 3 (just 3!) blogs that were my favourite. After reading through heaps of interesting blogs these are the three that stood out to me the most.

1. Jodie's Blog - Jodie’s blog was awesome. I loved the way that she was so enthusiastic about her company Lend Lease. Reading through her blog posts actually had me interested in Lend Lease and everything they do. What a good company to research I’d say! Jodie’s blog had a great layout and use of pictures to break up the text. I liked the down to earth way that Jodie has wrote her blog, this always kept you interested. 

2. Caitlin's Blog – I loved reading through Caitlin’s blog, it was well designed and had an awesome layout. Caitlin has put lots of effort into including pictures and links to videos. By having all this made it an easy read, as it was always a little different. Caitlin has explained a lot about her company, Oldfields Holdins LTD and she has provided a number of articles and interesting information. Good job! J

3. Vahid's Blog – Vahids blog is one of my favourite because everything he blogs about is interesting! I love his easy-going attitude in the blog, however he still explains what his company is all about in just enough detail. I really like the way that Vahid’s posts are presented and the layout of his blog overall.  

Scott Technology – Financial Reports – KCQ’s

SCOTT Technology Limited was established in 1913 and is a New Zealand based, publicly listed engineering company that specialises in the design and manufacture of automated production and process machinery (For more information on the company please see previous blog posts, My Company! and An Automated Future).  

I must admit, when I was first told that I was going to be given a company at random and that I had to overlook a their financial statements for the last four years and explain the key concepts and questions that arise to me; I was super nervous and had no idea what to expect. For starters, financial statements are made up of SO MANY different things, and all of these tell a story about the company. I can easily say I had no idea where to start.
 

So after a lot of reading, some thought and some number crunching this is what I discovered from analysing the financial statements for Scott Technology’s. 

The first thing that jumped out to me whilst reading through the 2014 financial reports was that the net profit after tax had actually decreased by $2.1m from the previous year. To me this was surprising as Scott Technology’s sounds like such a successfully diverse business. So I did some research.  In 2012 the company produced a profit before tax of $8.7 million, which was an increase of 19% on the previous year. So, why the drop in profit for the following two years? 

My understanding is that during 2014 Scott Technologies was effected by two major things. Firstly, the high value of the New Zealand dollar, which effected the manufacturing margins across all market sectors. And secondly, the major slowdown in mining sector markets. The cycle downturn in the mining sector had a massive impact on the company, reducing sales to these customers but about 50% on the previous year. Although the profit before tax was decreased from the previous years, the 2014 annual reports show that there was an increase in their revenue. I believe that the 73% increase in sales to customers in the appliance industry from 2013 to 2014 would have been one of the reasons for this. 

After understanding the challenges that the company has been faced with I still couldn’t understand why there was such a large decrease in profit, then I saw it. Scott Technologies acquired a significant amount of debt in the 2014 financial report.  Why was this? This was because Scott Technologies acquired two new businesses, Rocklabs and Robotworx. I found in the managing directors report that the company had exchanged a rent bill of $300,000 for an interest expense of $170,000 for the new Auckland properties that occupied the business unit, Rocklabs. This seemed like a large amount however this only has an overall term debt to the total assets ratio of 11%. 

You can see this impact of debt in the liabilities section of the 2014 balance sheet (bank overdraft and current portion of bank loans). This amount of debt is something that is not included in the previous years balance sheets, and did not impact on their profit. Although this had a large impact on the profit of the business in 2014 it added so much potential for the business to thrive in the various industry sectors that it offers. 

Personally I don’t believe that the 2014 financial statements indicate that Scott Technologies is struggling as they have acquired so many assets that can help their business grow. Their total assets have increased by $18m from the previous year. The way I see it is that there is plenty of evidence to show that the company is still developing new technologies, associating business opportunities and investing in new properties. All of these factors indicate that the company will deliver long-term results that support a sustainable business. There is a lot about the financial statements that confuse me, however from looking over them I can see that Scott Technologies are working hard overcome the challenges they have been faced with. 

Overall I’m happy with the company that I have been assigned, however there are a couple things that concern me. It is really hard to find supporting videos on the actual company, there are plenty on the products they manufacture but not really anything on the business as a whole. Otherwise, Scott Technologies has proven to be an interesting find.  

Company Website:

http://www.scott.co.nz/

Company Spreadsheet:
Scott Technology Limited - Company Spreadsheet 

Scott Technology’s Annual Reports:

2014 Annual Report

2013 Annual Report

2012 Annual Report

An Automated Future

Scott Technology vision themselves as a company that automates the future. The production line machinery they design and build delivers productivity gains and exceptional reliability to many of the world’s leading manufacturers. Scott Technology also believe they go a step beyond engineering production solutions to revolutionise entire industries by using robotics to automate manual processes and create genuine competitive advantage.

For over 100 years Scott has been rapidly responding to shifting needs. Today, they have production bases in the United States, China, Australia and New Zealand, customers in 88 countries, and a real commitment to developing new technology and bringing it to market. Across everything they do, Scott Technologies are widely recognised as a world-class builder of advanced automation systems, particularly for the appliance, meat processing, mining and superconductor industries globally.

This is a short video of the Front Loader Washing Cabinet Assembly Production Line, check it out! https://www.youtube.com/watch?v=BdAwJYCWB3g (There are many other videos available for viewing, but unfortunately for myself I have too weak of a stomach to sit through the automated meat processing videos). 

My Company!

The company that has been assigned to me for this assessment is SCOTT Technology Limited.  

SCOTT Technology Limited is a New Zealand based, publicly listed engineering company that specialises in the design and manufacture of automated production and process machinery. When I first looked this company up I new I was in for some research as SCOTT Technology offers such a diverse range of equipment to many different countries around the world.

SCOTT Technology was established in Dunedin, New Zealand in 1913 as an engineering company J & A P Scott. At first the company was solely focused on the appliance industry, however the slowdown in the American economy in 2001 gave SCOTT Technologies the incentive to diversify. The diversification lead the company to enter the Asian and European markets for appliance manufacturing systems. 

Through heavy investment in research and development in all areas of business SCOTT Technology has grown globally and is now widely recognised as a world class builder of advanced automation systems, particularly for the appliance, meat processing, mining and superconductor industries.

From what I have read so far my understanding is that this company has a lot to offer to many parties of business around the world. Last year the company achieved a profit before tax of $4.2m on revenues totalling $60.3m, which have slightly increased from the previous year. I can see why this profit would have been achieved as it is evident that the company is continuously introducing new products and technologies. For example in May 2014 Scott Technologies acquired the business of Robotworx, a seller and integrator of industrial robots. The robot industry is expected to grow sustainably due to it promising output of high quality products at a lower price.

Considering that I hadn’t heard of SCOTT Technologies until Friday afternoon, what I have learnt so far about my company is intriguing and I think that going through their financial statements will uncover a lot about the business itself. 

I look forward to reading through your blogs and hearing all about your companies! 

Welcome!

My name is Jamie-Lee Mew, I’m 21 years old and I live in Cairns. This is my first year of Uni and yes you could say that I am a little nervous to begin my studies! I am studding a Bachelor of Business part time through distance education while working full time as an administration/ purchasing officer for Cairns Regional Council.

I look forward to working together with you all as the journey of this course unravels! J