Research On Financial Performance Evaluation Of Company B Based On Efficacy Coefficient Method

With the improvement of China’s economic and social development level,people’s awareness of health care is also increasing.While Chinese society is gradually moving towards an aging society,the medical consumption market will gradually expand,and the Chinese medicine industry will also usher in an important development opportunity.However,under the joint influence of various reasons,such as the consistency evaluation of generic drugs,rising raw material prices and increasing environmental pressure,the cost of pharmaceutical companies continues to rise and the growth rate of industrial profits declines,all of which will have more or less impact on the business processes of pharmaceutical companies.Under such a huge industrial background,facing the challenges of industry mergers and acquisitions,stronger players and cross-industry alliances,listed companies must constantly improve their operating conditions to adapt to the ever-changing market environment.Starting from the research background,research purpose and significance,this paper chooses Company B as the research subject.This paper takes Company B as the research object,firstly,it reviews the domestic and foreign literatures,summarizes the domestic and foreign status of financial performance evaluation methods and indicators,defines the research methods and contents of this paper.Secondly,based on the above theory,this paper puts forward 18 indexes with four dimensions as the core: profitability,operating ability,solvency and development ability.Then,the entropy weight method is used to give weight to these indexes,and the efficiency coefficient method is used to evaluate the financial performance of enterprises.Finally,taking the relevant data of the financial statements of the company from 2016 to 2020 as the research sample,and taking Nanjing Pharmaceutical as the comparison company,the financial performance of Company B is evaluated and analyzed through horizontal and vertical comparison.The analysis shows that Company B has some problems,such as unreasonable main business structure,low utilization rate of assets,intensified business risks,concentrated market share and low R&D investment,etc.The allocation ratio of main business should be adjusted to further strengthen cost management.Improve the asset turnover efficiency of enterprises,and enhance the operational capability of enterprises;Maintain proper financial leverage and adjust the capital structure;Maintain the growth of operating income and stable development momentum.