Kohinoor Textile Mills_3

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Kohinoor Textile Mills.Kohinoor Textile Mills.Group Members

Fasih Ud-Din AfridiSami ullahImran Khan

Raza KhanMajid Khan



F inancialF inancial statement analysis:statement analysis:

1. Current ratio:One of the most general and frequently used liquidity ratio. It shows a firms ability tocover its current liabilities with its current assets.

0

0.2

0.4

0.6

0.8

1

1.2

1.4

2005 2006 2007 2008 2009

koehenor

industery average

Years Kohinoor IndustrialAverage

2005 1 .02 1 .10

2006 1 .07 1 .15

2007 1 .05 1 .25

2008 0 .75 0 .9 5

200 9 0 .80 0 .87



Trend Analysis of Trend Analysis of C Current Ratiourrent Ratio



2 . Acid test ratio:A more conservative measure of activity is the liquid test. It shows a firms ability to meetits current liabilities with its most liquid (quick) assets.

Year Kohinoor IndustrialAverage

2005 0 .4 7 1 .3 8

2006 0 .5 9 1 .55

2007 0 .6 9 1 .8 4

2008 0 .4 5 1 .4 5

200 9 0 .4 7 0 .93



Trend Analysis of Acid test RatioTrend Analysis of Acid test Ratio



3 . inventory turn over ratio:to determine how effectively the firm is managing inventory ( and also to gain anindication of the liquidity of the inventory). We compute the inventory turnover raio.


2005 4.3 2 2 .9 2

2006 3. 62 3.3 0

2007 3. 7 3 3.34

2008 4. 17 3.33

200 9 4. 17 3. 67



Trend Analysis of inventory turnover RatioTrend Analysis of inventory turnover Ratio



4 . Inventory turnover in days:to know how many days, on average, before inventory is turned in to accountreceivable through sales.


2005 8 4.4 1 125

2006 100 .7 110 .6

2007 98 .0 9 10 9. 28

2008 87 .5 3 10 9.9

200 9 87 .5 3 99.4 5



Trend Analysis of Inventory Turnover in daysTrend Analysis of Inventory Turnover in days



5 . Total asset turnover:

The relationship of net sales to total assets is known as total asset turnover.


2005 0 .608 0 .57

2006 0 .49 2 0 .61

2007 0 .55 0 .65

2008 0 .6 37 0 .6 9

200 9 0 .626 0 .80



Trend Analysis of Total Asset Turnover Trend Analysis of Total Asset Turnover



6 . Debt to equity ratio:To asses the extent to which the firm is using borrowed money.


2005 1 .0 4 1 .61

2006 0 .785 1 .60

2007 0 .785 1 .27

2008 0 .72 4 1 .5 4

200 9 0 .551 1 .51



Trend Analysis of Debt to Equity ratioTrend Analysis of Debt to Equity ratio



7 . Debt to asset ratio:It highlights the relative importance of debt financing to the firm by showingpercentage of firm·s assets that is supported by debt financing.


2005 58 .70% 0 .60

2006 36 .9 0% 0 .4 7

2007 62 .10% 0 .5 3

2008 67 .4 0% 0 .5 9

200 9 58 .70% 0 .58



Trend Analysis of Debt to Asset ratioTrend Analysis of Debt to Asset ratio



8 . Total capitalization ratio:It tells us the relative importance of long term debt to the capital structure of the firm.


2005 37 .10% 0 .33

2006 27 .10% 0 .3 1

2007 43. 20% 0 .3 0

2008 50 .66% 0 .34

200 9 20 .80% 0 .26



Trend Analysis of Total Capitalization RatioTrend Analysis of Total Capitalization Ratio



9 . Interest coverage ratio:It indicates a firm·s ability to cove interest charges. It is also called times interestearned.


2005 1 .7 9 2 .72

2006 0 .08 9 1 .25

2007 0 .44 6 1 .50

2008 0 .57 3.3 0

200 9 1 .3 5 1 .5 3



Trend Analysis of Interest Coverage RatioTrend Analysis of Interest Coverage Ratio



10. Gross profit ratio:This ratio tells us the profit of the firm relative to sales after we deduct the cost ofproducing the goods.


2005 14.

80 10.4

6

2006 1 4. 6 4 10 .15

2007 15 .3 8 10 .18

2008 1 4. 8 9 10 .06

200 9 18 .71 11 .9 0



Trend Analysis of Gross Profit ratioTrend Analysis of Gross Profit ratio



11. Net profit margin:It is the measure of firm profitability of the sales after taking account of all expensesand income taxes.


2005 4.3 2 1 .9 2

2006 -0 .56 -0 .2 9

2007 -0 .05 0 .57

2008 -5 .2 -1 .33

200 9 2 .6 1 .08



Trend Analysis of Net Profit MarginTrend Analysis of Net Profit Margin



12 . Return on assets:Indicates the profitability on the assets of the firm.


2006 -0 .0027 -0 .10

2007 -0 .0002 0 .55

2008 -0 .0 33 0 .3 2

2009

0.016 0

.22



Trend Analysis of Return on InvestmentTrend Analysis of Return on Investment



12 . Return on equity:Indicates the profitability to shareholders of the firm.


2005 0 .111 1 .17

2006 -0 .01 -0 .61

2007 -0 .0008 2 .05

2008 -0 .1 43 1 .27

200 9 0 .082 0 .88



Trend Analysis of return on EquityTrend Analysis of return on Equity



F indingsF indings

Liquidity:Current ratio of the company is decreasing.Acid test ratio shows company maintaining high level of inventory.

Asset Utilization:The inventory turnover ratio is increasing which means that sales are increasing.hence the inventory turnover in days is decreased.

Debt And Profitability:Debt to equity ratio is decreasing which means that company is using less portion ofdebt financing.However in total assets the company is using more portion of debt financing.Till2 00 8 the capitalization ratio was increasing, however in 2 00 9 it has decreasedfrom the industrial average as well. This means that in 2 00 9 the company is

maintaining low percentage of long term debts in total capitalization.Profitability:

The gross profit ratio of the company is increasing and over the industrial avg.The net ratio has decreased and observed negative however in 2 00 9 it hasbecome positive.ROA and ROE has increased till 2 00 9 , but less than industrial average.

Kohinoor Textile Mills_3

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