Impact of economic crisis on the financial performance of Blue Ocean Footwear Ltd.

Abstract

This report examines the financial performance of Blue Ocean Footwear Ltd. and its impact on the economy during the Covid-19 pandemic, dollar crisis, de-dollarization, and Ukraine & Russia war. The company generated 7.68% profit from net sales in 2015 and increased by 0.59% to 8.27% in 2015. However, in 2016, the company faced losses, leading to a negative profit margin ratio. In 2017, the company recovered its loss to 6.99%, but from 2018 to 2021, the net profit margin fluctuated, indicating a lack of steady revenue growth and risk for shareholders. The decline in net profitability can be attributed to the Covid-19 pandemic and the dollar crisis due to the Russia and Ukraine war. The study found a negative relationship between the financial performance of Blue Ocean Footwear Ltd. and economic crisis situations, such as the dollar crisis or global impacts of the Russia and Ukraine war. The calculated value of F was 5.94, which is greater than the tabulated value of F at 4.74 with alpha 0.05. The study supports that there is a negative relationship between a company's financial performance and economic crisis situations, particularly in the fiscal years 2019-2020 and 2021-2022. The Covid-19 pandemic in 2029-2020 and the dollar crisis in 2021-2022 were significant economic crises, while the Ukraine & Russia war in 2022 further impacted the company's financial condition. The structural break in financial data indicates that the company's financial condition is not stable, and it is essential to conduct further research and analysis to better understand the company's financial situation.