Butt Final FSA
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Transcript of Butt Final FSA
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Presented To:
Mr. Hamza Mukhtar
Presented By:
Faheem Anwar
Usman Butt
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Financial Statements
AnalysisWe will done our analysis in three Steps:
Economic Analysis
Industry Analysis
Firm Analysis Common size analysis
Vertical analysis
Horizontal analysis
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Economic Analysis
Internal Affairs & foreign trade
Inflation
GDP Growth
Credit Rating
Unemployment
Export High Duties Smuggling of Foreign Exchange
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Internal Affairs and Foreign
Exchange Political instability
Electricity Breakdown
Sui Gas
Devalue Of Rupee
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Inflation
Inability to reduce prices of petroleumproducts.
international commodity prices
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Inflation
Item 2005-06 2006-07 2007-08
CPI 7.9 7.8 10.3
Food Group 6.9 10.4 15.0
Non FoodGroup
8.6 6.0 7.5
INFLATION RATE
0
5
10
15
20
CPI Food Group Non FoodGroup
2005-06H
2006-07H
2007-08H
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Real GDP Growth
Current 2008 Projected 20085.8% 7.5%
GDP
This deficiency is due to:
Agriculture products such as cotton, sugarcane, and wheat falling below target putsome negative downstream effects on textile and sugar industries.
2005 2006 20007 2008
Cotton 14625 13019 12856 11655
Sugarcane 47244 44666 54742 63920
Wheat 12612 21277 23295 21749AGRICULTURE PRODUCTION
0
10000
20000
30000
40000
50000
60000
70000
2005 2006 2007 2008
Series1
Series2
Series3
Series4
Series5
Series6
Series7
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Impact of high energy cost. ( electricity, Sui
Gas )
Unpredicted rise in oil prices during 2008.
Beginning of year Boom Period price Ending of year$50 per barrel $147 per barrel $37 per BRL
Oil Prices
0
50
100
150200
beginning
of year
boom
period
price
ending of
year
Series1
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Credit Ranking
Previous Ranking ccc-
Current Ranking ccc+
Although the current credit ranking ofPakistan is ccc+ but it will be reviewed inJanuary
Export High DutiesHigh custom
High Tariff
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Unemployment
Unemployment is a central problem becausewhen unemployment is high, resources are
wasted and people's incomes are depressed;
during such periods, economic distress also
spills over to affect people's emotions andfamily lives.
Unemployment in rural areas is higher then theunemployment in urban areas due to industries.Mostly industries are established in urban areas.
Thats why the unemployment rate in urban
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Smuggling of Foreign
Exchange Withdraw Investment
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Economic Indicators
Leading Indicators
Other economic indicators
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Leading Indicators
variables that may indicate where the economywill be in the next 3 to 6 months.
Work Week
Unemployment claims
Order for consumer goods
Slower deliveries
Plant and equipment orders
Stock prices
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Industry
Analysis
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Industry Analysis
Ill use of Loans
Unavailability of cheap labor
Machinery imported but not used2004-05 05-06 06-07 07-08
928.6m 771.5 m 503m 281.6m
Credit purchase by Importers
High inflation increases the product prices
Fluctuation of cotton prices
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MTM
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Introduction of Firm
We are leaders in creating, developing andmanufacturing of knitted apparel products rightfrom basic to highly fashioned garments thusresponding to emerging trends in the industry. We
translate conceptual ideas of our customers intoreality and shape them through our technical bentand professional acumen. The team here stronglybelieves that Customer satisfaction is the essence ofbusiness today. MTM has the technology with
expertise,products with knowledge and most importantlythe right mindset to achieve totalcustomer satisfaction.
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Firm Analysis
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SHARE CAPITAL ANDRESERVE 2008 2007 2006
Authorized share capital 1,000,000 1,000,000 1,000,000
Issued subscribed and paid up
capital
900000 900000
0,000
Reserve 911300 695300 616469
Total Equity 1811300 1595300 1516469
Surplus on Revaluation of Assets 379420 379420 61967
Deferred income on sale and lease
back off operating fixed assed
4891 5639 7700
Balance Sheet
Cont.
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NON CURRENT LIABILITES 2008 2007 2006
Long Term financing
Liability against subject to finance
lease
Defferred liability for gratuity
1769245
219851
107789
265989
276138
90180
297933
387515
76082
Total 2096885 632307 761530
CURRENT LIABILITIES
Trade and other payables
Accrued Mark-up
Short term finances
Current portion of long term
liabilities
Provision for taxation
906159
84911
2621724
254874
74257
674138
77642
3684328
220115
57243
748578
64189
2912069
256596
104518
Total 3941925 4713466 4085950Cont.
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Total Liabilities 6038810 5345773 4847480
CONTENGIES AND
COMMITEMENTS- -
TOTAL LIABILITES AND SHARE
HOLDERS EQUITY
8234421 7326132 6433616
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Non Current Assets 2008 2007 2006Property, Plant & Equipment 3025599 2808261 2130740
Long term advances 6004 6733 7466
Long Term Security Deposits 16338 23918 23972
Total 3047941 2838912 2162178
Assets Side
Cont.
C t A t 2008 2007 2006
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Current Assets 2008 2007 2006
Stores, spares and loose tools 366850 286203 277923
Stock in trade1838707 1813977 1891260
Trade Debts 1933875 1611302 1414949
Loans and advances 165391 130095 115283
Trade deposits and short term
prepayments
166415 109201 145438
Other Receivables 577987 460874 367351
Cash and bank balances 137255 75568 59234
ToTal Assets 8234421 7326132 6433616
Cont.
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Profit & Loss Account2008 2007 2006
Sales
Less: Cost of goods sold
7884785
6428798
6017735
4963190
4899190
4000910
Gross profit
Add: Other operating income
Total
1455987
8700
1464687
1054545
6887
1061432
898280
2778
901058
Distribution cost
Administrative expenses
Other operating expenses
Finance cost
(348281)
(1395770)
(29855)
(538964)
(289470)
(132967)
(31586)
(439539)
(245922)
(123812)
(13766)
(335266)
Profit before Taxation 408010 167870 182292
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2008 2007 2006
Profit Before Taxation
Less:provision for taxation
408010
74257
167870
57243
182292
52329
Profit After Taxation 333753
-
110627 129963
Earnings Per Share-Basic 11.13 3.69 4.33
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Local & Export Sale
0%
50%
100%
150%
2008 2007
Export
Local
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profit & loss graph
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
2008 2007 2006
Series1
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Liquidity Ratios
Ratios 2008 2007
Current Ratio 1.3:1 0.9:1
The increase in ratio is resulting due to the
increase in different current assets.i.e themajor change in the current assets (cash) andtrade Receivables and inventory is alsoincreased.
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Cash Ratio
Cash from operations/Current Liabilities
2008 20070.0348:1 .0160:1
The ratio is increasing due to increase in cash
and decrease in current liabilities.
ANALYSIS OF PROFITABILITY
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ANALYSIS OF PROFITABILITY
Profitability can be analyzed by using differentratios:
Gross profit Margin Ratio 2008 2007
Gross Profit/Sales 18.4% 17.52%
The ratio of Gross profit is increasing due to thefollowing reasons:
Increase in sales :Fluctuation in Dollar:
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Net Margin Ratio 2008 2007Net profit/Sales 4.23% 1.84%
The increase in net margin ratio is due toincrease in sales and ultimately high profits.
Operating Margin 2008 2007
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Operating Margin 2008 2007
Operating Profit/Sale 12%
10.09%
One reason of increasing in the ratio of operating
profit is already discussed that sales are
increasing.
Other reason is that in other expenses provision
for doubtful debts is not done.
Assets Turnover Rati0
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Assets Turnover Rati0
2008 2007Net Sales/Average Total Assets 1.0 % o.43%
The main reason in increasing the ratio is an
increase in the value of sales .
LONG TERM DEBT PAYING
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LONG TERM DEBT PAYING
ABILITY
Debt To Equity 2008 20073.33:1 3.35:1
The company long term debt paying ability decrease in 2008because the ratio represents that company are using more debt ascompared to its equity. And this also shows that company has topay more outside the firm as compared to the inside of the firm
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Asset management Ratio
Ratios 2008 2007
Average collectionperiod
4.44 3-97
Avg R/a TOR in
days
81days 91days
Operating Cycle 183 days 225days
Inventory T.overRatio
3.52 2.68
Inventory T.over indays
102 days 134 days
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Long Term debt ratio
Ratios 2008 2009
Debt to totalasset ratio
0.73:1 0.72:1
Capitalization
Ratio
.054:1 0.28:1
Time interestEarned Ratio
1.91 1.51
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Common Size Analysis
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SHARE CAPITAL AND
RESERVE 2008(%) 2006 (%) 2005(%)Authorized share capital _ _ _
Issued subscribed and paid up
capital
11.41 14.96 18.37
Reserve 11.56 11.55 12.58
Total Equity 22.97 26.51 30.95
Surplus on revaluation of operationof fixed asset
4.81 6.31 1.26
Deferred income on sale and lease
back of operating fixed assets
0.06 0.09 0.03
Balance Sheet
Cont.
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NON CURRENT LIABILITES 2008(%) 2007 (%) 2006
(%)
Long Term financing
Liability against subject to
finance lease
Deferred liability for gratuity
22.44
2.79
1.37
4.42
4.59
1.50
6.08
7.91
1.55
Total 26.59 10.51 15.54
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CURRENT LIABILITES 2008(%) 2007 (%) 2006 (%)
Trade and other payables
Accured Mark-up
Short term financing
Current Portion of long term liabilities
Portion for Taxation
11.49
1.08
33.25
3.23
.094
11.20
1.29
61.22
3.66
.96
15.28
1.31
59.44
5.24
2.13
Total 49.99 78.33 83.40
Total Liability 76.59 88.83 98.94
CONTENGIES ANDCOMMITEMENTS
- - -
TOTAL LIABILITES AND
SHARE HOLDERS EQUITY
104.43 121.74 146.71
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Non Current Assets 2008
(%)
2006 (%) 2005
(%)
Property, Plant & Equipment 38.37 46.67 43.49
Long Term Loans and Advances 0.08 0.11 0.15
Long Term Deposits 0.21 0.40 0.49
Total 38.66 47.18 44.13
Cont.
Assets Side
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Current Assets 2008
(%)
2006
(%)
2005 (%)
Stores, spares and loose tools 4.65 4.76 5.67
Stock in trade 23.32 30.14 38.60
Trade Debts 24.53 26.78 28.88
Loans and advances 2.10 2.16 2.35
Trade deposits and short term
prepayments
2.11 1.81 2.97
Other Receivables 7.33 7.66 7.50
Cash and bank balances 1.74 1.26 1.21
Total Current Assets 65.78 74.54 87.19
Total Assets 104.43 121.74 131.32Cont.
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2008
(%)
2006
(%)
2005
(%)Sales
Less: Cost of goods sold
100
81.53
100
82.43
100
81.66
Gross profit 18.47 17.52 18.34
Distribution cost
Administrative expenses
Other operating expenses
Total expenses
Profit before other incomes
Other operating income
Profit from Operation
Finance cost
4.42
1.77
0.38
6.57
11.90
0.11
12.01
6.84
4.81
2.21
0.52
7.54
9.98
0.11
10.09
7.30
5.02
2.53
0.28
7.83
10.51
0.06
10.56
6.84
Profit & Loss A/C
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2008(%) 2006 (%) 2005 (%)
Profit Before Taxation
Less:provision for taxation
5.17
0.94
2.79
0.95
3.72
1.07
Profit After Taxation 4.23 1.84 2.65
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Index Analysis
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SHARE CAPITAL AND
RESERVE2008(%) 2007 (%) 2006
(Base
Year)
Authorized share capital - - -
Issued subscribed and paid up
capital
0 0 100
Reserve 48 13 100
Total 512 512.01 100
Balance Sheet
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NON CURRENT LIABILITES 2008(%) 2007 (%) 2006
Long Term financing
Liability against subject to
finance lease
Deferred liability for Gratuity
494
-43
42
-11
-29
19
100
100
100
Total 175 -17 100
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CURRENT LIABILITES 2008 (%) 2007(%) 2006(%)
Trade and other payables
Accured Mark-up
Short term financing
Current Portion of long term liability
Taxation
21
32
-10
-1
-29
-10
21
27
-14
-45
100
100
100
100
100
Total -4 15 100
Total liability 25 10 100
TOTAL LIABILITES AND
SHARE HOLDERS EQUITY
15 2 100
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Non Current Assets 2008 (%) 2007
(%)
2006(bas
e year)
Property, Plant & Equipment 42 32 100
Long Term Loans and Advances -20 -10 100
Long Term security deposits 99.54-32 0 100
Total 41140.63 31 100
Assets Side
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Current Assets 2008(%) 2007(%) 2006(%)
Stores, spares and loose tools 32 3 100
Stock in trade -3 -4 100
Trade Debts 37 14 100
Loans and advances 43 13 100
Trade deposits and short termprepayments
14 -25 100
Other Receivables 57 25 100
Cash and bank balances 132 28 100
Total 21 5 100
Total Assets 28 14 100
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2008(%) 2007(%) 2006(base
year)
Sales
Less: Cost of goods sold
61
61
23
24
100
100
Gross profit
Add: Other operating income
62
213
17
148
100
100
Distribution cost
Administrative expenses
Other operating expensesFinance cost
42
13
11361
18
7
12931
100
100
100100
Profit before Taxation 124 -8 100
Profit & Loss A/C
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2008(%) 2007(%) 2006(base
year)
Profit Before Taxation
Less:provision for taxation
124
42
-8
9
100
100
Profit After Taxation 157 -15 100
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Thank You Very
Much