PPB GROUP BERHAD Listed on the Main Market of Bursa Malaysia Securities Berhad, PPB Group Berhad was incorporated in Malaysia in 1968 and is engaged in property investment and investment holding.

PPB Group's core businesses are grains trading, flour and animal feed milling as well as downstream activities including livestock farming; food processing; bakery and marketing and distribution of consumer products. FFM Group in which PPB has 80% equity interest, owns and operates a total of five (5) flour mills in the country and one (1) each in Vietnam, Thailand and Indonesia. The FFM Group supplies more than 40% of Malaysia's flour requirements.

PPB is also the single largest shareholder, owning 18.3% equity interest in one of Asia's largest integrated agribusiness groups, Wilmar International Limited (Wilmar) which operates in more than 20 countries across four continents and has over 300 processing plants. Wilmar has an extensive distribution network for its products which are sold to more than 50 countries globally.

Besides food manufacturing, PPB owns Golden Screen Cinemas SdnBhd which is the largest film exhibitor in Malaysia with 197 screens in 24 locations nationwide, capturing about 40% of domestic box office collections. PPB Group has grown into a major conglomerate with assets and market capitalisation totaling RM15.2 billion and RM20.4 billion respectively as at 31 December 2011.

PPB's strategic acquisitions and business ventures over the years have enabled it to successfully diversify its businesses to include in addition to the above, environmental engineering and waste management; contract manufacturing; chemicals manufacturing; property development and management; and packaging operation.

PPB Group currently has operations in China, Vietnam, Indonesia, Myanmar, Thailand and Singapore and employs more than 3,500 employees in its domestic and overseas operations.

Liquidity Ratio

1. Current ratio Current ratio = Year 2011 (RM000) 2010 (RM000) =4.88 Analysis In year 2011, the current ratio of PBB is 4.27 while the current ratio of PBB in year 2010 is 4.88. By comparison between the both years, the current ratio in year 2010 is higher than the year 2011. This means that PBB has higher ability to use its asset to pay its current liabilities in year 2010. The current ratio can give a sense of the efficiency of the PBB operating cycle or its ability to turn its product into cash. The higher the current ratio, the more capable the company is of paying its obligations.

2. Acid test ratio Acid test ratio = Year 2011 (RM000) 2010 (RM000) =3.96

Analysis In year 2011, the acid test ratio of PBB is 3.34 while the acid test ratio of PBB in year 2010 is 3.96. By comparison between the both years, the acid test ratio in year 2010 is higher than the year 2011. It is obviously that the current liabilities in year 2011 are much higher than in year 2010. Year 2011 has higher inventories than year 2010 which mean in year 2011 has fully utilize their asset to generate money.

3. Average collection period Average collection period = Year 2011 (RM000) 55.43days 2010 (RM000) = 50.47 days

Analysis In year 2011, the average collection period of PBB is 55.43 days while the average collection period of PBB in year 2010 is 50.47 days. By comparison between the both years, the average collection period for year 2010 is shorter than the year 2011. Therefore, it indicates that in year 2010, the PBB has higher ability to collect its credits back as compare to year 2011 which take longer period.

Efficiency ratio

1.

Total asset turnover Total asset turnover = Year 2011 (RM000) 0.18 times 2010 (RM000) =0.16times

Analysis In year 2011, the total asset turnover of PBB is 0.18 times while the total asset turnover of PBB in year 2010 is 0.16 times. By comparison between the both years, the total asset turnover for year 2011 is higher than the year 2010. Therefore, it indicates that in year 2011, the PBB is more effective in managing firms balance sheet as compare to year 2010. Hence, it show that in year 2011 generated sales better than year 2010 in utilizing total assets of their company.

2.

Inventory turnover Inventory turnover = Year 2011 (RM000) 4.87times 2010 (RM000) = 5.68 times

Analysis In year 2011, the inventory turnover of PBB is 4.87 times while the inventory turnover of PBB in year 2010 is 5.68 times. By comparison between the both years, the inventory turnover for year 2010 is higher than the year 2011. Therefore, it indicates that in year 2010, the inventories of PBB are more liquid as compare to year 2010. Therefore, it shows that in year 2010 clear the inventories faster than year 2011.

3.

Fixed asset turnover Fixed asset turnover = Year 2011 (RM000) 0.21 times 2010 (RM000) = 0.19times

Analysis In year 2011, the fixed asset turnover of PBB is 0.21 times while the fixed asset turnover of PBB in year 2010 is 0.19 times. By comparison between the both years, the fixed asset turnover for year 2011 is higher than the year 2010. Therefore, it indicates that in year 2011, the PBB is more effective in managing firms balance sheet as compare to year 2010. Hence, it show that in year 2011 generated sales better than year 2010 in utilizing fixed assets of their company.

4. Accounts receivable turnover Accounts receivable turnover = Year 2011 (RM000) 6.58 times 2010 (RM000) = 7.23 times

Analysis In year 2011, the accounts receivable turnover of PBB is 6.58 times while the accounts receivable turnover of PBB in year 2010 is 7.23 times. By comparison between the both years, the accounts receivable turnover for year 2011 is lower than the year 2010. Therefore, it indicates that in year 2010, the PBB has higher ability to collect its credits back as compare to year 2011 which means that the credit sales are much higher than the account receivable.

5. Operating Income Return on Investment (OIROI) OIROI = Year 2011 (RM000) = 6.95 2010 (RM000) x 100=8.12

Analysis In year 2011, the OIROI of PBB is 6.95% while the OIROI of PBB in year 2010 is 8.12%. By comparison between the both years, the OIROI for year 2011 is lower than the year 2010. Therefore, it indicates that in year 2010, the PBB is more effective in management at generating operating profits on the firms assets as compare to year 2011.

6. Operating profit margin Operating profit margin = Year 2011 (RM000) =38.98 2010 (RM000) x100=49.76

Analysis In year 2011, the operating profit margin of PBB is 38.98% while the operating profit margin of PBB in year 2010 is 49.76%. By comparison between the both years, the operating profit margin for year 2011 is lower than the year 2010. Therefore, it indicates that in year 2010, the PBB is more effective in managing firms income statement as compare to year 2011. A high operating profit margin means that the year 2010 has better cost control and/or that sales are increasing faster than costs, which is the optimal situation for the company.

Leverage ratio

1. Debt ratio Debt ratio = Year 2011 (RM000) x 100 =4.17 2010 (RM000) x 100 =3.26

Analysis In year 2011, the debt ratio of PBB is 4.17% while the debt ratio of PBB in year 2010 is 3.26%. By comparison between the both years, the debt ratio for year 2011 is higher than the year 2010. Therefore, it indicates that in year 2011, the PBB is using more debt to finance it firms assets as compare to year 2010. In general, a higher debt ratio indicated that a company will face a greater hazard in its ability to settle its debts obligation. The lower the debt ratio indicated that a company will the less a firm is financed by outside parties.

2. Times interest earned Times interest earned = Year 2011 (RM000) = 181.92 times 2010 (RM000) =237.76 times

Analysis In year 2011, the times interest earned of PBB is 181.92 times while the times interest earned of PBB in year 2010 is 237.76 times. By comparison between the both years, the times interest earned for year 2010 is higher than the year 2011. It means that in year 2010 is more capable to repay fixed interest from its net operating profit compare to year 2011 even though the amount of interest expense for year 2010 is high. In general, the higher the value of times interest earned ratio means that there is a greater ability of company to repay its interest and debt which also means that the more likely it is that the corporation will be able to meet its interest payment.

3. Return on equity (ROE) ROE = Year 2011 (RM000) = 6.95% 2010 (RM000) x 100 = 14.16%

The DuPont model ROE = net profit margin total assets turnover / (1- Debt ratio) =(

) / (1-

)

Year

2011 (RM000)

2010 (RM000)

=6.95%

=14.16%

Analysis In year 2011, the return on equity of PBB is 6.95% while the return on equity of PBB in year 2010 is 14.16%. By comparison between the both years, the return on equity for year 2011 is lower than the year 2010. Therefore, it indicates that in year 2010, the PBB has higher accounting rate of return on the stockholders investment as compare to year 2011.