Q1.: Using the financial statements of Oil Search Limited (OSH) calculate the Altman Z-score value for the prior three years. Use year-end share price/market capitalization, if needed. You can get this data from DatAnalysis or from web search. Altman Z-score 2018 2019 2020 Evaluate the bankruptcy risk of OSH over the prior three years. Explain the change in Z-score over the prior three years. Q2.: Would the Altman-type Z-score model (and its variants) be suitable for predicting distress among private firms? Why or why not? Q3.: Why would a company pay to have its public debt rated by a major rating agency (such as Fitch's, Moody's or Standard & Poor's)? Why might an organisation decide not to have its debt rated? ($millions) Operating Revenue Other Revenue 750.74 0.14 12/11 12/12 12/13 697.82 856.35 12/14 12/15 12/16 12/17 12/18 12/19 12/20 1,963.39 Total Revenue 750.88 43.41 741.23 0.24 856.59 9.46 1,972.85 2,170.45 20.31 2,190.76 1,625.22 1,779.51 156.19 87.12 1,781.41 1,866.63 2,124.46 65.03 2,219.68 138.27 1,358.23 111.88 2,189.49 2,357.95 1,470.11 Excluding Interest Operating Expenses -233.85 -376.40 -359.03 -793.56 -1,231.11 -610.82 -563.84 -711.26 -809.75 -1,155.58 EBITDA 517.03 364.84 497.57 1,179.30 959.65 1,170.59 1,302.79 1,478.23 1,548.19 314.53 Depreciation -11.22 -12.11 Amortisation -39.30 -35.52 Depreciation and -50.52 -47.63 -14.97 -308.06 -41.13 0.00 -56.10 -308.06 -558.11 0.00 -558.11 -603.51 -487.91 0.00 -603.51 0.00 -487.91 -462.02 0.00 -462.02 -590.51 -550.25 0.00 -590.51 0.00 -550.25 Amortisation EBIT 466.51 317.21 441.46 871.24 401.55 567.08 814.87 1,016.21 957.68 -235.71 Interest Revenue Interest Expense 6.85 -7.49 5.09 -9.48 4.36 -21.30 4.54 -162.54 9.32 -262.69 14.98 -285.84 22.43 -272.08 27.49 -324.82 34.74 -364.41 17.92 -265.08 Net Interest Expense -0.65 -4.39 -16.93 -158.00 -253.37 -270.87 -249.65 -297.32 -329.66 -247.16 PreTax Profit 465.86 312.82 424.53 713.23 148.17 296.21 565.22 718.89 628.02 -482.87 Tax Expense -233.77 Net Profit after Tax 232.09 -165.45 -194.62 147.37 229.91 -282.58 430.65 -202.08 -53.90 -131.62 -177.93 -235.46 164.60 387.30 483.43 -194.56 433.46 58.36 -424.51 Before Abnormals Abnormals -32.72 21.96 0.00 0.00 0.00 -40.50 0.00 0.00 12.47 8.18 Abnormals Tax 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Net Abnormals -32.72 21.96 0.00 0.00 0.00 -40.50 0.00 0.00 12.47 8.18 Reported NPAT After 199.37 169.33 229.91 430.65 -53.90 124.09 387.30 483.43 445.93 -416.33 Abnormals Outside Equity 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Interests Shares Outstanding at 1,325.16 1,334.76 1,343.36 1,522.69 1,522.69 1,522.69 1,523.63 1,523.63 1,524.75 2,077.85 Period End Weighted Average 1,319.33 1,330.27 1,339.18 1,481.50 1,522.69 1,522.69 1,523.27 1,523.63 1,524.33 1,929.35 Number Of Shares EPS Adjusted 17.50 11.04 17.10 28.98 -3.54 10.80 25.35 31.62 28.32 -22.00 (cents/share) EPS After Abnormals 15.04 12.68 17.10 28.98 -3.54 8.14 25.35 31.62 29.13 -21.58 (cents/share) Date Open High Low Close Volume Market Capitalisation ($m) Shares on Issue 03/09/2021 3.830 34,619,821 7,958.17 2,077,850,664 31/08/2021 30/07/2021 3.740 200,155,142 7,771.16 2,077,850,664 3.810 232,745,761 7,916.61 2,077,850,664 30/06/2021 3.810 193,400,058 7,916.61 2,077,850,664 31/05/2021 3.640 124,077,857 7,563.38 2,077,850,664 30/04/2021 3.800 150,184,559 7,895.83 2,077,850,664 31/03/2021 4.100 163,681,021 8,519.19 2,077,850,664 26/02/2021 4.240 141,454,779 8,810.09 2,077,850,664 29/01/2021 3.880 154,860,754 8,062.06 2,077,850,664 31/12/2020 3.710 148,763,570 7,708.83 2,077,850,664 30/11/2020 3.640 269,924,908 7,563.38 2,077,850,664 30/10/2020 2.570 156,204,167 5,340.08 2,077,850,664 30/09/2020 2.640 184,284,341 5,485.53 2,077,850,664 31/08/2020 3.270 180,951,850 6,794.57 2,077,850,664 31/07/2020 2.920 206,299,053 6,067.32 2,077,850,664 30/06/2020 3.170 310,072,624 6,586.79 2,077,850,664 29/05/2020 3.480 293,026,765 7,230.92 2,077,850,664 30/04/2020 3.050 442,721,635 6,218.89 2,038,979,955 31/03/2020 2.319 280,316,774 3,536.04 1,524,746,985 28/02/2020 5.349 159,934,468 8,156.63 1,524,746,985 31/01/2020 7.055 101,328,495 10,756.63 1,524,746,985 31/12/2019 7.064 75,147,417 10,771.42 1,524,746,985 29/11/2019 7.250 69,479,649 11,053.65 1,524,746,985 31/10/2019 6.977 84,715,221 10,637.70 1,524,746,985 30/09/2019 7.133 144,333,068 10,875.41 1,524,746,985 30/08/2019 6.470 120,556,129 9,865.11 1,524,746,985 31/07/2019 6.928 101,698,377 28/06/2019 6.889 81,008,171 10,563.45 10,503.98 1,524,746,985 1,524,746,985 31/05/2019 6.870 83,591,261 10,474.25 1,524,746,985 30/04/2019 7.581 63,326,552 11,550.34 1,523,631,192 29/03/2019 7.649 87,616,072 11,654.25 1,523,631,192 28/02/2019 8.156 67,919,561 12,426.28 1,523,631,192 31/01/2019 7.610 98,295,237 11,594.99 1,523,631,192 31/12/2018 6.977 78,757,665 10,629.92 1,523,631,192 30/11/2018 7.123 81,131,691 10,852.67 1,523,631,192 31/10/2018 7.571 111,695,230 11,535.56 1,523,631,192 28/09/2018 8.799 67,662,645 13,406.13 1,523,631,192 31/08/2018 8.731 95,400,475 13,302.21 1,523,631,192 31/07/2018 8.750 73,932,355 13,331.93 1,523,631,192 29/06/2018 8.672 83,253,275 13,213.23 1,523,631,192 31/05/2018 8.058 89,806,689 12,277.88 1,523,631,192 30/04/2018 7.639 82,387,382 29/03/2018 6.967 99,765,615 28/02/2018 7.357 78,899,961 31/01/2018 7.376 64,320,566 11,639.48 10,615.14 11,208.90 11,238.61 1,523,631,192 1,523,631,192 1,523,631,192 1,523,631,192 ($millions) 12/18 12/19 12/20 Operating Revenue 18.73 26.89 4.58 Other Revenue 0.00 0.59 27.22 Total Revenue Excluding Interest 18.73 27.48 31.80 Operating Expenses -75.89 -65.20 -90.09 EBITDA -57.15 -37.72 -58.29 Depreciation -0.44 -1.32 -1.66 Amortisation -1.12 -1.12 -1.00 Depreciation and Amortisation -1.56 -2.45 -2.66 EBIT -58.71 -40.17 -60.95 Interest Revenue 0.40 0.59 Interest Expense -7.28 -9.19 0.03 -10.28 Net Interest Expense -6.88 -8.60 -10.26 PreTax Profit -65.59 -48.77 -71.21 Tax Expense 5.07 Net Profit after Tax Before Abnormals -60.52 6.00 -42.77 Abnormals -1.96 -0.15 Abnormals Tax 0.00 0.00 0.85 -70.36 5.14 0.00 Net Abnormals -1.96 -0.15 5.14 Reported NPAT After Abnormals -62.49 -42.92 -65.22 Outside Equity Interests 0.00 0.00 0.00 Shares Outstanding at Period End 497.42 536.78 587.59 Weighted Average Number Of Shares 491.76 516.86 584.42 EPS Adjusted (cents/share) -12.31 -8.27 -12.04 EPS After Abnormals (cents/share) -12.31 -8.27 -12.04