With various types of reports on corporate sustainability, in this
case, Global Reporting Initiative (GRI), the Environment, Social and Government
(ESG) reports which are provided by the same company, together with these the
17 SDGs have been fundamental to be able to gather the data needed for this
Research Project. The case study method has been developed using GRI, Triple
Bottom Line and SDGs, which we have structured to understand the concern for
social and environmental aspects that this company has in the daily work of its
operations and how committed its environmental policies are. As a frame of
reference, we also use the ecological, socio political cultural factors on
which this company is focused.
Every
business desire is to grow progressively as time elapses because no investor
would love to invest in a business that does not promise a return from their
investment. The growth of a business can either be by way of the increment in
its market share, increment in the company's size in terms of the revenue
generation and the total assets the company has with time. To assess the growth
of a company, there is a need to perform analysis of the various metrics such
as analyzing the company's financial statements, conducting performance
reviews, and checking on customer satisfaction. This paper will seek to
establish the methods used by Atlantica Sustainable Infrastructure to analyze
their growth and how they have been able to grow in the years, they have been
in operation.
The
company is a sustainable infrastructure company that owns most of its business
in the renewable energy assets and the environment sectors. The company's main
goal is to help the world transition towards a more sustainable world by
investing heavily in the clean energy sector (Infrastructure, 2021). Like any
other business, Atlantica Sustainable Infrastructure Plc has a group of
stakeholders who have committed their investments in the business. Therefore,
one of the methods used by the company to analyze their growth is by way of
measuring the company's stock prices. A rise in the stock prices of the company
is an indication of the company's growth, while a decline in the stock prices
is an indication that the company is doing poorly, and hence no investor is
interested in putting their money in the company.
It
is good to indicate that an investor would love to see that the stock prices
rising once they have bought it because it would mean that they can sell the
shares and make a profit, or rather they can be assured of receiving dividends
at the end of each financial year. For instance, a look at the performance of
the basic earnings per share in the company's income statement for the
financial years that ended 2017, 2018, and 2019 indicates the following
results. In the financial year that ended 2017, the basic earnings per share in
the company were -1.12, while in the financial year that ended in 2018, the
company posted basic earnings per share equivalent of 0.42 (Finance, 2021).
Lastly,
at the end of the fiscal year that ended in 2019, the company posted basic
earnings per share equivalent of 0.61 (Finance, 2021). The fiscal year results
that ended in 2020 indicated that the company posted basic earnings per share
equivalent of 0. However, from the trend of the performance posted above, we
can see that the basic earnings per share of the company have been increasing
continuously except for the fiscal year that ended in 2020, indicating growth
of the company in terms of the stock prices over time. The possible reason why
the company posted basic earnings per share equivalent to zero in the fiscal
year that ended in 2020 is because of the effects of Covid-19.
The
other metric used by the company to assess its growth is by measuring the total
assets the company has over time. Growth of the company would be reflected by
an increment in the total number of assets, while a decline in the total assets
of the company would mean that the company has not grown over time but instead
reducing in size. The following are the results of the company's performance
over time regarding the total number of assets. In the financial year that
ended in 2017, the company posted in its balance sheet that it had total assets
amounting to $10,492,339, while in the financial year that ended in 2018, the
company registered that its total assets amounted to $9,919,031 (Finance,
2021).
In
the financial year that ended in 2019, the company posted that its total assets
amounted to $9,659,815, while in the year that ended in 2020, its total assets
amounted to $9,938,354 (Finance, 2021). From the trends above of the total
assets, we can see that the assets in the company declined between the fiscal
year that ended in 2017, 2018, and 2019. However, in the fiscal year that ended
in 2020, the company posted an increment in the value for its total assets
relative to its total assets in the financial year that ended in 2019. We can
conclude that the company has not majorly grown in terms of the total assets
the company has accumulated over time.
Measuring
its profitability is another method used by the company to determine its growth
over time. An increment in the profits that the company accumulates in a
financial year compared to the previous financial year indicates the company's
growth because it means that it sold more while keeping its costs fairly low.
The company has performed as follows regarding the number of profits it has
generated over time. We will use the earnings figures before interest and tax
to indicate the differences in terms of performance regarding the profits. In
the financial year that ended in 2017, the company disclosed an EBIT of
$406,172, while in the financial year that ended in 2018, the company disclosed
an EBIT of $454,721 (Finance, 2021).
In
the financial year that ended in 2019, the company generated an EBIT of
$454,230, while in the fiscal year that ended in 2020, the company posted an EBIT
of $357,988 (Finance, 2021). From the performance trends, we can conclude that
the company's growth in terms of its profitability has been declining majorly.
The
other method used to measure the company's growth is based on the
sustainability of its activities in society. Given that the company's line of
investment is based on the generation of clean energy, we can confirm that its
growth is very likely because of the directions taken by most countries of
adopting clean energy to mitigate the effects of climate change. Furthermore,
the company has invested heavily in sustainable technologies, and it was rated
by the Sustainalytics in December 2018 on its environmental, social, and
governance factors as the top company with renewables (Compact, 2018). This
means that the company is in the right direction, and its growth is assured.
The
other method that the company can use to measure its growth is by comparing the
number of its employees' overtime. An increment in the number of employees over
time is an indication that the company has grown and vice versa. This is because
a larger workforce means that the company has increased in size and has many
activities to accomplish, hence creating a large workforce. The number of
employees in the company has increased to 522 currently compared to when it was
founded in 2013. This indicates that the company has substantially grown over
time.