The Growth Potential of Financial Aspects of Agricultural Enterprises

Szalka, Éva – Katits, Etelka

Keywords: financial analysis, growth rates, operative financing needed, value drivers, Q14

This study examines the balance sheet and income statement data of the fiscal years between 1992-2014. The object of our examination is the external and direct measurement of corporate growth. We pose the following research questions: (1) what changes happened to the Internal Growth Rate (IGR), the Sustainable Growth Rate (SGR) and the Self-Financeable Growth Rate (SFGR) in the knowledge of the volume of business data? (2) what kind of factors influenced the development of these increase rates, and how? (3) operative vs. strategic financing: which are the building stones of the operative? and (4) financing needed? The financing measures and risktaking of owners. The agricultural sector under investigation (a) achieved a low IGR; (b) the SGR and SFGR are lower than the sales revenue growth rates calculated from the profit and loss account; (c) there is no consistency between the growth and the rate of return necessary to finance; (d) a significant amount of financing period indicates a liquid resource needed for financing the operation; (e) the profit and cash-based net sales revenue is similar to or even exceeds the net sales revenue reported in the profit and loss account; (f) the profitability-efficiency requirement does not apply, i.e. low operational profitability, asset efficiency and productivity; (g) value-creating factors allow a relatively low shareholder value growth. Our findings may support the framing of the strategy of the corporate periods of life with a financial view and tactics.