Financial performance and economic value added: the case of a pharmaceutical company
Purpose: To analyze leading Mexican pharmaceutical company Genomma Lab's financial performance by examining its value creation from 2010 to 2020. Method: A case study approach is employed, incorporating an analysis of Porter's Five Forces, the calculation of Economic Value Added (EVA) alo...
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| Format: | Article |
| Language: | English |
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Universidad de Concepción
2025-07-01
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| Series: | RAN |
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| Online Access: | https://revistas.udec.cl/index.php/ran/article/view/14293 |
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| author | Gerardo Flores Nava María Luisa Saavedra García María del Rosario Cortes Castillo |
| author_facet | Gerardo Flores Nava María Luisa Saavedra García María del Rosario Cortes Castillo |
| author_sort | Gerardo Flores Nava |
| collection | DOAJ |
| description | Purpose: To analyze leading Mexican pharmaceutical company Genomma Lab's financial performance by examining its value creation from 2010 to 2020.
Method: A case study approach is employed, incorporating an analysis of Porter's Five Forces, the calculation of Economic Value Added (EVA) alongside traditional financial indicators, and a longitudinal and correlational analysis of the relationships among these metrics.
Findings: The firm presented value creation from 2010 to 2014, value destruction in 2015 and 2016, and value creation again from 2017 to 2020. ROA and EVA show a moderate positive correlation; ROE and EVA, a high positive correlation; and a very high positive correlation between EVA and EPS. In contrast, while the ROCE metric showed no correlation.
Practical Implications: The Economic Value-Added model can be applied to Latin American companies to complement traditional methods of analysis of financial performance.
Originality: This study contributes to the literature on financial performance measurement through the implementation of the Economic Value-Added model in the Latin American context. Additionally, it contributes to the comparison of traditional metrics, a topic that has been under-researched. |
| format | Article |
| id | doaj-art-b154040721a64bf899caa55b04546dfe |
| institution | Kabale University |
| issn | 0719-7713 0719-6245 |
| language | English |
| publishDate | 2025-07-01 |
| publisher | Universidad de Concepción |
| record_format | Article |
| series | RAN |
| spelling | doaj-art-b154040721a64bf899caa55b04546dfe2025-08-20T04:02:28ZengUniversidad de ConcepciónRAN0719-77130719-62452025-07-0111211910.29393/RAN11-17DFGC30017Financial performance and economic value added: the case of a pharmaceutical companyGerardo Flores Nava0María Luisa Saavedra García1María del Rosario Cortes Castillo2Universidad Nacional Autónoma de MéxicoUniversidad Nacional Autónoma de MéxicoInstituto Politécnico NacionalPurpose: To analyze leading Mexican pharmaceutical company Genomma Lab's financial performance by examining its value creation from 2010 to 2020. Method: A case study approach is employed, incorporating an analysis of Porter's Five Forces, the calculation of Economic Value Added (EVA) alongside traditional financial indicators, and a longitudinal and correlational analysis of the relationships among these metrics. Findings: The firm presented value creation from 2010 to 2014, value destruction in 2015 and 2016, and value creation again from 2017 to 2020. ROA and EVA show a moderate positive correlation; ROE and EVA, a high positive correlation; and a very high positive correlation between EVA and EPS. In contrast, while the ROCE metric showed no correlation. Practical Implications: The Economic Value-Added model can be applied to Latin American companies to complement traditional methods of analysis of financial performance. Originality: This study contributes to the literature on financial performance measurement through the implementation of the Economic Value-Added model in the Latin American context. Additionally, it contributes to the comparison of traditional metrics, a topic that has been under-researched.https://revistas.udec.cl/index.php/ran/article/view/14293economic value addedpharmaceuticalscompetitive forcescost of capitaltraditional metrics |
| spellingShingle | Gerardo Flores Nava María Luisa Saavedra García María del Rosario Cortes Castillo Financial performance and economic value added: the case of a pharmaceutical company RAN economic value added pharmaceuticals competitive forces cost of capital traditional metrics |
| title | Financial performance and economic value added: the case of a pharmaceutical company |
| title_full | Financial performance and economic value added: the case of a pharmaceutical company |
| title_fullStr | Financial performance and economic value added: the case of a pharmaceutical company |
| title_full_unstemmed | Financial performance and economic value added: the case of a pharmaceutical company |
| title_short | Financial performance and economic value added: the case of a pharmaceutical company |
| title_sort | financial performance and economic value added the case of a pharmaceutical company |
| topic | economic value added pharmaceuticals competitive forces cost of capital traditional metrics |
| url | https://revistas.udec.cl/index.php/ran/article/view/14293 |
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