Prospective Analysis -Financial Statement Analysis and Valuation

iii) Create a Projected Cash Flow Statement, you can refer to the Projected Statement of Income and Projected Statement of Financial Position. In this stage, the future cash flows are computed from the projected statement of income and the projected statement of financial position (balance sheet).

SELANGOR PROPERTIES BERHAD PROJECTED STATEMENT OF PROFIT OR LOSS AND OTHER COMPRE- HENSIVE INCOME FOR 3 YEARS (2016,2017,2018) Estimate 2019 2018 2017 2016 RM'000 RM'000 RMOOCRM'000 Revenue Revenue Cost of sales Gross profit Other income Administration expenses Other operating expenses Operating profit Finance costs Profit/loss before tax Income tax expense Net profit for the year Other comprehensive income 14,347 153,284 140,165 120,925 (1,512) (16,158) |(9,733) (480) 12,835 137,126 130,432 120,445 0 19,249 70,208 82,799 |(2,775) (20,629) (18,548) (16,562) 0 |(113,680)(55,504) (74,427) 10,060 22,066 126.588|112.255 (11,223) (11,167) (12.139) (13,496) (1.163) (10.899 114.44998,759 (14) (12,995) (21,850)(31,397) (1,149) |(2,096) 92,599 67,362 Items that may be reclassified to profit or loss in subsequent periods: - Foreign currency translation |(34,279) 5,293 13,452 Net gain (loss) on cash flow hedge 151 786 (34,128) 6,079 1623 14,075 Total other comprehensive income to be reclassified to profit or loss in subsequent periods for the year, net of tax Total comprehensive income for the year (36,224) 98,678 81,437 Profit attributable to owners of the parent Total comprehensive income (2,096) 92,599 67,362 (36,224) 98,678 81,437 attributable to owners of the parent Earnings per share attributable to owners of the parent (sen per share) Basic (0.6) 26.9 19.6 Diluted (0.6) 26.9 19.6 PROJECTED STATEMENT OF PROFIT OR LOSS AND OTHER COMPRE- HENSIVE INCOME Forecasting Assumptions (%) Forecasting Process (RM) Sales growth (153,284-153,284)/153,284 =9.360% 153,2849.360% = 14,347 Gross profit margin 137, 126/ 153,284= 89.459% 14,34789.459 = 12,835 Administrative expenses 20,629)/153,284=13.458% K20,629)13.458% = (2,775) Interest expense (Finance cost) Prior-year long term (11,167) 4,894+253,420 = 4.323% 207,620 + 5 1,998)4.323% = debt 11,223 Income tax expense/Pretax income |(12,995) 10,899 = 1.192% K1,163) 1.192% = 14 PROJECTED STATEMENT OF FINANCIAL POSITION Estimate 2019 2018 2017 2016 RM'000 RM'000 RM 000 RM'000 Property development costs 206,854 205,342 138,349 115,144 Inventories 1,512 720 720 837 Trade receivables 14,347 6,539 4,054 4,075 Other receivables 3,710 3,710 3,698 2,828 Tax recoverable 4,868 4,868 5,481 5,363 Financial asset at fair value through profit or loss 559,022 559,022 737,028 785,182 Cash and bank balances 1,985,744 430,739 304,131 233,120 Total current assets 1,221,052 1,210,940 1,193,461 1,146,549 Assets for sale 1,608 1,608 3,046 Non-current assets Property, plant and equipment 54,066 52,195 54,448 55,530 Land held for property development 423,294 423,294 426,136 421,447 Investment properties 1,207,708 1,207,708 285,464 1,245,520 Investment in subsidiaries Financial assets available for sale (AFS) 24,388 24,388 23,675 24,417 Other receivables 7,404 7,404 7,204 20,361 Deferred tax assets 3,622 3,622 3,622 3,622 Total assets 2.943,142 2.931,159 2,997,0562,917,446 Borrowings 51,998 51,998 253,420 4,000 Cash flow hedge instrument 193 193 230 1,140 Trade payables and contract liabilities 3,452 36,860 29,499 9,844 Other payables 21,529 23,002 18,510 19,063 Provisions 9,518 9,518 8,659 7,984 Tax payable 653 606 346 279 Total current liabilities 65,814 122,177 310,664 42,310 Non-current liabilities Borrowings 207,620 207,620 4,894 239,468 Deferred income 636 636 Cash flow hedge instruments 26 26 213 Deferred tax liabilities 137,931 137,931 141,271 125,183 Total liabilities 346,213 468,390 456,829 407,174 Share capital 545,371 545,371 545,371 343,617 Reserves = 54,110 54,110 88,238 283,913 1,864,346 1,863,288 1.906618 1,882,742 Retained earnings Total equity and liabilities= 2.943,142 2,931,159 2,997,056 | 1,156,927 Projected Statement of Financial Position (balance sheet) Forecasting assumptions (%) Forecasting process (RM) Accounts receivable turnover 23.442 (14,347 / 23.442) Inventory turnover 22.442 (1512 / 22.442) Accounts payable turnover 10.438 (1,512 / 0.438) Accrued expenses turnover 16.664 (14,347 / 6.664) Taxes payable / tax expense 4.663 (14 / 4.663) Dividends per sh 10.6 Capital expenditure (CAPEX) in RM RM1,871 CAPEX / Sales 13.041 SELANGOR PROPERTIES BERHAD PROJECTED STATEMENT OF PROFIT OR LOSS AND OTHER COMPRE- HENSIVE INCOME FOR 3 YEARS (2016,2017,2018) Estimate 2019 2018 2017 2016 RM'000 RM'000 RMOOCRM'000 Revenue Revenue Cost of sales Gross profit Other income Administration expenses Other operating expenses Operating profit Finance costs Profit/loss before tax Income tax expense Net profit for the year Other comprehensive income 14,347 153,284 140,165 120,925 (1,512) (16,158) |(9,733) (480) 12,835 137,126 130,432 120,445 0 19,249 70,208 82,799 |(2,775) (20,629) (18,548) (16,562) 0 |(113,680)(55,504) (74,427) 10,060 22,066 126.588|112.255 (11,223) (11,167) (12.139) (13,496) (1.163) (10.899 114.44998,759 (14) (12,995) (21,850)(31,397) (1,149) |(2,096) 92,599 67,362 Items that may be reclassified to profit or loss in subsequent periods: - Foreign currency translation |(34,279) 5,293 13,452 Net gain (loss) on cash flow hedge 151 786 (34,128) 6,079 1623 14,075 Total other comprehensive income to be reclassified to profit or loss in subsequent periods for the year, net of tax Total comprehensive income for the year (36,224) 98,678 81,437 Profit attributable to owners of the parent Total comprehensive income (2,096) 92,599 67,362 (36,224) 98,678 81,437 attributable to owners of the parent Earnings per share attributable to owners of the parent (sen per share) Basic (0.6) 26.9 19.6 Diluted (0.6) 26.9 19.6 PROJECTED STATEMENT OF PROFIT OR LOSS AND OTHER COMPRE- HENSIVE INCOME Forecasting Assumptions (%) Forecasting Process (RM) Sales growth (153,284-153,284)/153,284 =9.360% 153,2849.360% = 14,347 Gross profit margin 137, 126/ 153,284= 89.459% 14,34789.459 = 12,835 Administrative expenses 20,629)/153,284=13.458% K20,629)13.458% = (2,775) Interest expense (Finance cost) Prior-year long term (11,167) 4,894+253,420 = 4.323% 207,620 + 5 1,998)4.323% = debt 11,223 Income tax expense/Pretax income |(12,995) 10,899 = 1.192% K1,163) 1.192% = 14 PROJECTED STATEMENT OF FINANCIAL POSITION Estimate 2019 2018 2017 2016 RM'000 RM'000 RM 000 RM'000 Property development costs 206,854 205,342 138,349 115,144 Inventories 1,512 720 720 837 Trade receivables 14,347 6,539 4,054 4,075 Other receivables 3,710 3,710 3,698 2,828 Tax recoverable 4,868 4,868 5,481 5,363 Financial asset at fair value through profit or loss 559,022 559,022 737,028 785,182 Cash and bank balances 1,985,744 430,739 304,131 233,120 Total current assets 1,221,052 1,210,940 1,193,461 1,146,549 Assets for sale 1,608 1,608 3,046 Non-current assets Property, plant and equipment 54,066 52,195 54,448 55,530 Land held for property development 423,294 423,294 426,136 421,447 Investment properties 1,207,708 1,207,708 285,464 1,245,520 Investment in subsidiaries Financial assets available for sale (AFS) 24,388 24,388 23,675 24,417 Other receivables 7,404 7,404 7,204 20,361 Deferred tax assets 3,622 3,622 3,622 3,622 Total assets 2.943,142 2.931,159 2,997,0562,917,446 Borrowings 51,998 51,998 253,420 4,000 Cash flow hedge instrument 193 193 230 1,140 Trade payables and contract liabilities 3,452 36,860 29,499 9,844 Other payables 21,529 23,002 18,510 19,063 Provisions 9,518 9,518 8,659 7,984 Tax payable 653 606 346 279 Total current liabilities 65,814 122,177 310,664 42,310 Non-current liabilities Borrowings 207,620 207,620 4,894 239,468 Deferred income 636 636 Cash flow hedge instruments 26 26 213 Deferred tax liabilities 137,931 137,931 141,271 125,183 Total liabilities 346,213 468,390 456,829 407,174 Share capital 545,371 545,371 545,371 343,617 Reserves = 54,110 54,110 88,238 283,913 1,864,346 1,863,288 1.906618 1,882,742 Retained earnings Total equity and liabilities= 2.943,142 2,931,159 2,997,056 | 1,156,927 Projected Statement of Financial Position (balance sheet) Forecasting assumptions (%) Forecasting process (RM) Accounts receivable turnover 23.442 (14,347 / 23.442) Inventory turnover 22.442 (1512 / 22.442) Accounts payable turnover 10.438 (1,512 / 0.438) Accrued expenses turnover 16.664 (14,347 / 6.664) Taxes payable / tax expense 4.663 (14 / 4.663) Dividends per sh 10.6 Capital expenditure (CAPEX) in RM RM1,871 CAPEX / Sales 13.041