CONSOLIDATED AND Company STATEMENTS OF PROFIT OR LOSS AND COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2014 GROUP Note 2014 2013 Company 2014 2013 KShs'000 REVENUE 4 9,057,292 KShs'000 KShs'000 9.211.462 8.914.256 KShs'000 8,958,001 COST OF SALES 5 (6,661,720) (6.878.139) (6,556,963) (6,685,295) GROSS PROFIT 2.395,572 2,333.323 2,357,293 2,272,706 Other operating income 6 267,792 36.388 257,043 36,388 Provisions written back 32,237 56.988 32,237 56,891 2.695.601 2.426.699 2.646.573 2,365,985 EXPENSES Selling and distribution 7 (511,731) (422.251) (481.469) (418.435) Administration and establishment 8 (1,935,930) (1.450.158) (1.902,833) (1.426.499) Profit Before interest Other operating expenses 9 (340.895) (213.359) (322,180) (206,505) (2.788,556) (2,085,768) (2.706,482) (2.051,439) (LOSS)/PROFIT FROM OPERATIONS (92.955) 340.931 (59.909) 314,546 FINANCE INCOME 10 1,427 66,000 700 60,886 FINANCE COSTS 11 (318,941) (311,612) (318.941) (311,612) EXCHANGE GAIN ON FOREIGN CURRENCY LOAN 13 36,769 594.113 36.769 594,113 FAIR VALUE GAIN ON INVESTMENT PROPERTY 21 730.046 730,046 (LOSS)/PROFIT BEFORE TAXATION 12 (373,700) 1,419,478 (341,381) 1,387,979 TAXATION (CHARGE)/CREDIT 15(b) (12,931) 355,905 (11,868) 355,905 (LOSS)/PROFIT FOR THE YEAR (386,631) 1,775,383 (353,249) 1,743,884 OTHER COMPREHENSIVE INCOME Items that will not be reclassified Revaluation surplus 17 976,780 976,780 Deferred income tax on revaluation surplus 34 (264,837) (264,837) Items that may be reclassified subsequently to profit or loss: 20 20 subsequently to profit or loss: Exchange differences on translation of foreign operation 1.049 1,508 INCOME TOTAL OTHER COMPREHENSIVE 1,049 713.451 711,943 TOTAL COMPREHENSIVE (LOSS)/ INCOME FOR THE YEAR (385,582) 2,488,834 (353.249) 2.455.827 (LOSS)/EARNINGS PER SHARE Basic and diluted (KShs) 16 (4.30) 19.73 (3.93) 19.38 CONSOLIDATED AND Company STATEMENTS OF FINANCIAL POSITION AS AT 30 JUNE 2014 GROUP Note 2014 2013 Company 2014 2013 KShs'000 KShs'000 KShs'000 KShs'000 ASSETS NON-CURRENT ASSETS Property, plant and equipment Capital work-in-progress Intangible assets Prepaid operating leases Investment properties Investment in subsidiary Loan swap asset Restricted deposits 21 22 TR022 17 7.591.940 8,015,560 7,591,835 8,015,379 18 701,740 133,752 701,740 133,752 19 39,977 39,977 20 9,498 11.497 9,498 11,497 2.225,046 2.225.046 2,225,046 2,225,046 2,500 2.500 23 1.834.377 2,044.066 1,834,377 2,044,066 24 30.595 61.742 30.595 61.742 12,393,196 12.531,640 12,395,591 12.533.959 CURRENT ASSETS Inventories 25 2,199,517 2,191,123 2.192.859 2,172,290 Trade and other receivables 26 845,223 883.028 621.052 641,736 Amount due from related parties 27 474 6,030 333,083 398,077 Taxation recoverable 15(c) 116,188 119,262 117.251 119,262 X Short term deposits 24 31,366 29,558 31.366 29,558 X Bank balances and cash 28 131,293 373,062 99.531 265,482 3.324,061 3,602,063 3,395,142 3.626,405 TOTAL ASSETS 15,717,257 16,133,703 15,790,733 16.160,364 EQUITY AND LIABILITIES CAPITAL AND RESERVES Share capital Share premium 29(a) 450,000 450,000 450,000 450,000 29(b) 648,000 648,000 648,000 648.000 Asset revaluation reserve Retained earnings 29(c) 1,884,722 1,900,899 1,884,722 1,900,899 Foreign currency translation reserve 29(d) 5.515 TOTAL EQUITY NON-CURRENT LIABILITIES Loan swap liability 3.716,438 4,086,892 4,466. 3,798,332 4,135,404 6,704,675 7,090,257 6,781,054 7,134,303 1,667,493 1,895,374 917,954 677,904 2,357,448 2,140,291 2,357,448 Staff gratuity Does not a trace 23 1,667,493 1,895,374 any interest 31 917,954 677,904 Long-term loan 32(c) 2,140,291 Post import finance loans Obligations under finance leases 33 43.155 Deferred taxation Taxes to hot fatich within duration CURRENT LIABILITIES Current portion of long-term loans 32(c) 477.679 15.525 43.155 15,525 34 759.030 759.030 750.087 750,087 5,500,293 5.723.968 5,500,293 5.723.968 324,945 477.679 324,945 32(d) 324.274 324.274 Obligations under finance leases 33 37.964 48,534 37.964 48,534 Bank overdraft 35 547.228 853.223 547.228 853.223 Trade and other payables 36 2.125,144 1.944.894 2.122.241 1.927.509 Provision for bonus and legal fees 37 147,882 3.512.289 3.319.478 3.509,386 TOTAL EQUITY AND LIABILITIES 15.717.257 16,133,703 147.882 3,302,093 15,790,733 16.160.364 Required a. Calculate the key ratios under each of the categories below to evaluate the financial performance of the company 1. Liquidity ratios. Current ratio Cash ratio 2. Gearing/leverage/capital structure ratios. Debt ratio: Capital gearing ratio Interest cover ratio 3. Profitability ratios. Gross profit margin Net profit margin Return on capital employed Return on equity 4. Growth and valuation ratios. - - - Earnings per share Price-earnings ratio given average share price for 2014 to be sh 53 Earning yield b. Provide a detailed analysis of the company performance, indicating whether you concur with the report provided by the management on the financial performance of the company