MYL Company K.S.C.P. Al Amounts in KWD Relance Sheet 2018 2015 2020 Harta Analyse Intry Average 11 TOON O 20.0 SARAN 117 ta 4 Assets 5 Cash & Short Term restents 7 Accounts Receivable Totalmente 9 Prepaid Expenses 10 Total Current Assets 11 Property/Pantalons 12 Acumulated Depreciation. To 1) Property Manten. To Net 14 Long Term Inwestments 15 Total Assets 981.100 41.92150 BIN 9.5.200 7081.100 MASO TRR 150 100 11.300 120.00 (87.46.250 22.124,100 07290.000 127.590,200 465 400 TO 25.M7400 21.40 NO 5121,400 2010 190.151.90 31.12.200 4700 10.10 UN 11.06.200 EN (700 KTN MILO 21.150 121.OO 99 95 17,00 RISO 1. ALSO 72.150 20N ON 400.000 15.295,850 12 Liabilities 10 Accounts Payable 19 Acred Expenses 20 Notes Puybie/Short Te Debt 21 Other Current bles-Tota! 22 Total Current Liabilities 23 Long Term Debe 24 Total Long Term Debt 25 Total Debt 26 Minority interest 27 Other abilities. Total 28 Total Liabilities 2.415,200 1.1.2.300 5.000.00 21.100 21,564 500 14.000 1,400 7.57.900 2015 5.925.950 30.6.100 1530 1050 731.400 2.6346 14 582 000 1.531110 101110 751.400 6472.050 6.100 27,541.00 SON 100% too 1.41.00 LON 157 141.00 0950 62650 24.541.450 109 TEN 100% 100% 30 Shareholders Equity 31 Common Stock - Total 32 Additional Paid-in Capital 33 Retained Earnings (Accumulated Deficit) 34 Treasury Stod. Common 35 Unrealised Gain Loss 36 Other Equity Total 37 Total Equity 3 BERGS 36.795.000 5951250 16.500 9,341,700 250g 92.383700 1977,400 3524150 14.567.050 16.00 11.443.650 41.400 00100 37,033,450 16 999 100 100 9.000 201250 101.26.100 256 EN 102.746.750 SON 39 40 Income Statement 2018 2020 95% 100W 51.359,000 51,359,000 2019 54,790,600 54,790,600 29,876,250 42 Revenue 43 Total Revenue 44 Cost of Revenue, Total 45 Gross Profit 55,448,400 55,448,400 40,315,550 102% 38.918,300 102% 12,441,050 14,914,350 15,132,850 102 111% 46 117% 6,008,750 (18.400) 90% 6.157.100 47 Selling/General/Admin. Expenses, Total 48 Interest Expense (incomel, Net Operating. Total 49 Unusual Expense (income) so Other Operating Expenses, Total 51 Total Operating Expense 52 Operating income 53 Interest Income (Expensel. Net Non-Operating Total 54 Gain (Loss) on Sale of Assets 55 Net Income Before Taxes 5,761,500 (101,200) 1,582,400 (242.650) 46,876 300 7.914,300 6,621,700 (178,2501 822,250 (264,500) 47,316,750 158% 10X 8.131.650 535 (253,000) 50,811,600 547 400 (1.803.2001 1,946,950 692,300 923,450 1,490,400 27% 142 8,837,750 9,620,900 5% 143% 56 374,900 169% 8.464,000 14% 57 Provision for Income Taxes 58 Net Income After Taxes 59 Minority interest 60 Net Income 35.650 656,650 (66,700) 589,950 393 300 9,227,600 (272,550) R,956,200 8,464,000 15% 13% 61 62 -8% 63 64 12% 65 12 66 62 12 68 12 69 70 12 71 101 72 8N 73 ON 74 92% 75 KPL Company is a Kuwaiti publicly traded company established in 1997 (however, the founding family still owns about 70% of the shares). It operates in the food and beverage industry. It started off as a small company importing higher end water brands and a few meat products, which they then sold to hotels, restaurants, and coffee shops. Since then, they expanded their operations and are now the exclusive licensed distributer of over 30 exclusive brands of high end beverages (including from water, juices, and carbonated drink)s, as well as an extensive range of meat, dairy, and cooking ingredients products (beef, lamb, fish, chicken, dairy products, oils, herbs/spices, etc.) The founder has decided to step down from the CEO position in 2015 and assigned his son to the role. The founder is now the Chairman of the Board of Directors and wants the CEO evaluate the performance of his son over the past 3 years. The CEO has called you, as the Chief Financial Officer, to perform a financial statement analysis for him to review before presenting it to the Board. You are requested to refer to the financial statements for to KPL Company K.S.C.C. and perform the following: 1) Perform the Horizontal Analysis (as a %) using 2018 as the base year. 2) What can you conclude about the company's overall health/performance compared to the Industry average with regards to the following (fill the table): 1) Perform the Horizontal Analysis (as a %) using 2018 as the base year. 2) What can you conclude about the company's overall health/performance compared to the Industry average with regards to the following (fill the table): Une Item 2019 % 2020 % Ind. Avg. Conclusions 113% 138% 117% Cash Total Inventory Accounts Receivable Total Liabilities Cost of Goods Sold Gross Profit Net Income 78% 102% 102% 104% 3) On the excel sheet provided, calculate all of the ratios included in the equation sheet provided on the next page. 4) You were not able to find the industry averages for Kuwait for the above ratios. However, what conclusions can you make from the ratios? NOTE: ALL YOU WORKINGS MUST BE DONE ON THE EXCEL SHEET USING EQUATIONS Ratio Formula Ratio Formula Gross profit margin Liquidity Current Net return on assets Total current assets Total current liabilities Curent assets- inventories Current liabilities Quick, or Acid Test EBIT Total operating revenue Net income Total average assets EBIT Total average assets Net income to stokholders Average common equity Gross return on assets Asset Management Inventory Turnover Return on common equity Days sales outstanding Fixed assets turnover Cost of goods sold Inventories (average) Receivables Sales per day Annual sales Net fixed assets (average) Annual sales Total assets (average) Total assets tumover Debt Management Debt ratio Total debt Total assets Interest coverage EBIT Interest charges Profitability Net profit margin Net income Total operating reverne 1 KPL Company K.S.C.P. All Amounts in KWD Balance Sheet 3 2018 2019 2020 Horizontal Analysis Industry Average 1135 106% 117% 138 818 3,768,550 5,294,600 20,595,350 19,683,400 931,500 41,953, 150 118,206,200 (83,993,700) 34,211,350 46,921,150 123,086,800 9,685,300 7,031,100 20,399,850 18,838,150 568, 100 48,171,200 120,065,750 (87,946,250) 32,124,100 47,296,050 127,590,200 4,365,400 10,565,050 25,847,400 21,476,250 633,650 51,239,400 121,280,150 190,151,950) 31,128,200 48,458,700 130,826,300 113% 89N 88N 95% 95% 8,415,700 9,367,900 69% 1,639,900 1,848,050 243% 4 Assets 5 Cash 6 Short Term Investments 7 Accounts Receivable 8 Total Inventory 9 Prepaid Expenses 10 Total Current Assets 11 Property/Plant/Equipment. Total Gross 12 Accumulated Depreciation - Total 13 Property/Plant/Equipment - Total-Net 14 Long Term Investments 15 Total Assets 16 17 Llabilities 18 Accounts Payable 19 Accrued Expenses 20 Notes Payable/Short Term Debt 21 Other Current liabilities. Total 22 Total Current Liabilities 23 Long Term Debt 24 Total Long Term Debt 25 Total Debt 26 Minority interest 27 Other Liabilities Total 28 Total Liabilities 29 30 Shareholders Equity 31 Common Stock - Total 32 Additional Pald-In Capital 33 Retained Earnings (Accumulated Delicit) 34 Treasury Stack-Common 35 Unrealized Gain (Loss) 36 Other Equity - Total 37 Total Equity 5.800,600 731,400 77% 3,521,300 2,634,650 306% 14,582,000 99N 8,115,5SO 1,644,500 723,350 4,692,000 15,293,850 1.583,800 1.583,800 841,800 3,280,950 6,268,650 100% 21,564,800 1.443,000 1,443,000 7.987.900 3,207,350 5,925,950 100N 1.521,130 1,521,130 731,400 6,471,050 6,488,300 10% 152N 109 30,698,100 24,843,450 27,541,350 78% 39.277,400 40,013,100 100% 36,824,150 37,033,450 100% 43% 39,848,650 36,295,400 5.951,250 15,900) 9,841,700 140,250) 14,567,050 16,900) 19 16,990, 100 39,100) 9,087,300 201,250 11.443.650 856% 41,400 4% 92,388,700 102,746,750 103,286,100 103N 38 You are requested to refer to the financial statements for to KPL Company K.S.C.C. and perform the following: 1) Perform the Horizontal Analysis (as a %) using 2018 as the base year. 2) What can you conclude about the company's overall health/performance compared to the Industry average with regards to the following (fill the table): Line Item 2019 % 2020 % Conclusions Ind. Avg. 113% Cash 138% Total Inventory Accounts Receivable Total Liabilities 117% 78% 102% Cost of Goods Sold Gross Profit 102% Net Income 104% 3) On the excel sheet provided, calculate all of the ratios included in the equation sheet provided on the next page. 4) You were not able to find the industry averages for Kuwait for the above ratios. However, what conclusions can you make from the ratios? NOTE: ALL YOU WORKINGS MUST BE DONE ON THE EXCEL SHEET USING EQUATIONS Ratio Formula Ratio Formula Liquidity Current Gross profit margin Total current assets Total current liabilities Current assets - inventories Current liabilities Net return on assets Quick, or Acid Test Gross retuun on assets EBIT Total operating revenue Net income Total average assets EBIT Total average assets Net income to stokholders Average common equity Asset Management Inventory Tumover Return on common equity Days sales outstanding Fixed assets tumover Cost of goods sold Inventories (average) Receivables Sales per day Annual sales Net fixed assets (average) Annual sales Total assets (average) Total assets turnover Debt Management Debt ratio Interest coverage Total debt Total assets EBIT Interest charges Profitability Net profit margin Net income Total operating revenue Based on all your calculations and conclusions above, what is your assessment of the new CEO's performance so far? List as many strengths/pros and weaknesses/cons on his performance as you can below: Areas of Strength Areas of Weakness D Income Statement 2018 2019 2020 95% 51,359,000 55,448,400 100N Revenue Total Revenue Cost of Revenue, Total Gross Profit 102% 54,790,600 54,790,600 39,876,250 51,359,000 38,918,300 55,448,400 40,315,550 15,132,850 102% 12,441,850 14,914,350 102% 111 117% 94% Selling/General/Admin. Expenses, Total Interest Expense (income). Net Operating Total Unusual Expense (income) Other Operating Expenses, Total Total Operating Expense Operating income Interest Income (Expense, Net-Non-Operating Total Gain (Loss) on Sale of Assets Net Income Before Taxes 6,008,750 (18,400) 6,157,100 (253,000) 50,811,600 547,400 (1,803,200) 1,946,950 5,761,500 (101,200) 1,582,400 (242,650) 46,876,300 7,914,300 923,450 158% 6,621,700 (178,250) 822,250 (264,500) 47,316,750 8,131,650 1,490,400 10% 535 27% 142% 692,300 8,837,750 9,620,900 5% 143N 35,650 169% 374,900 8,464,000 14 Provision for Income Taxes Net Income After Taxes Minority interest o Net Income 656,650 (66,700) 589,950 393,300 9,227,600 (272,550) 8,956,200 8,464,000 15% 1 13% 2 3 -6% 4 5 12% -6 12% 2 8 12% 59 12% 70 1 12% 101% 8% 23 J 24 0% 35 92% 76 1 KPL Company K.S.C.P. All Amounts in KWD 2 Balance Sheet 3 2018 2019 2020 Horizontal Analysis Industry Average 113% 106% 117% 138% 4 Assets 5 Cash 6 Short Term Investments 7 Accounts Receivable 8 Total Inventory 9 Prepaid Expenses 10 Total Current Assets 11 Property/Plant/Equipment - Total Gross 12 Accumulated Depreciation - Total 13 Property/Plant/Equipment - Total-Net 14 Long Term Investments 15 Total Assets 3,768,550 5,294,600 20,595,350 19,683,400 931,500 41,953,150 118,206,200 (83,993,700) 34,211,350 9,685,300 7,031,100 20,399,850 18,838,150 568,100 48,171,200 120,065,750 (87,946,250) 32,124,100 4,365,400 10,565,050 25,847,400 21,476,250 633,650 51,239,400 121,280, 150 (90,151,950) 31,128,200 81% 113% 89% 87% 88% 46,921,150 95% 47,296,050 127,590,200 48,458,700 130,826,300 123,086,800 95% 16 8,415,700 8,115,550 9,367,900 69% 1.644,500 243% 723,350 77% 1,639.900 5,800,600 3,521,300 21,564,800 1,443,000 4,692,000 306% 17 Llabilities 18 Accounts Payable 19 Accrued Expenses 20 Notes Payable/Short Term Debt 21 Other Current liabilities. Total 22 Total Current abilities 23 Long Term Debt 24 Total Long Term Debt 25 Total Debt 26 Minority interest 27 Other Liabilities - Total 28 Total Liabilities 1,848,050 731,400 2,634,650 14,582,000 1,521,130 1,521 130 15,293,850 99% 1,583,800 100N 1.443,000 1,583 800 100% 7,987,900 841,800 731,400 10% 3,207,350 3,280,950 6,471,050 157% 5.925,950 6,268,650 109% 6,488,300 27,541,350 30,698,100 24,843,450 78% 29 39,848,650 40,013,100 100% 36.795,400 37,033,450 100% 30 Shareholders Equity 31 Common Stock - Total 32 Additional Pald-in Capital 33 Retained Earnings (Accumulated Deficit) 34 Treasury Stock-Common 35 Unrealized Gain (Loss) 36 Other Equity - Total 37 Total Equity 39,877,400 36,824,150 14,567,050 15.900) 43% 16,990,100 (39,100) 1% 5,953,250 16,900) 9,841,700 (40,250) 92,388,700 11.443,650 9,087,300 856% 201 250 -4% 41,400 102,746,750 103,286,100 103% 38