Question 7

UUSUNJOU omon sized analysis) of XYZ non-cyclical businesses? Please elaborate. 7. The following are the financial statements (along with common sized anal Ltd. 3/31/2009 12 42,674 822 100.0 1.9 33.8 PROFIT AND LOSS ACCOUNT 3/31/2008 Statement Date Amounts in: US$ Millions No. of Months 12 Turnover 36,441 Less: Carriage inwards 701 Less: Cost of Goods Sold 11,005 Gross Profit/(Loss) 24,735 Less: Admin Overheads 16,469 Less: Selling Overheads 3,755 Less: Depreciation 1,652 Less: Amortization of Intangibles 48 Total Operating Expenses 21,924 Operating Profit/(Loss) 2,811 Add: Other Income/(Expenses) 3,027 Less: Interest Payable 734 Net Profit/(Loss) before Taxation 5.104 Less: Current Taxation Less: Deferred Taxation (31) Net Profit/(Loss) after Taxation 5.076 BALANCE SHEET - ASSETS AND LIABILITIES 100.0 1.9 30.2 67.9 45.2 10.3 4.5 0.1 64.2 14,443 27,409 18,997 3,797 2,150 44.5 8.9 5.0 61 0.1 25,005 2,404 (910) 21 59 1,044 Statement Date 3/31/2008 3/31/2009 22.3 15.1 CURRENT ASSETS Cash Trade Debtors Liquid Assets Stock Due from Related Companies Advance Lease Deposits Other Debtors Prepayments Available for Sale Financial Assets 10,360 1,679 12,039 751 1,384 912 1,482 1,723 7,168 1,107 8,275 1,053 2,070 900 1,682 1,350 96 Financial Risks 145 ed to Maturity Investments Derivatives Other Current Assets Tocal Current Assets 216 188 6.001 18,791 45.9 21.369 2.048 560 1.228 223 1.377 5.436 26.805 29,086 113 441 1,039 192 125 1,910 30.996 61.3 0.2 0.9 22 04 0.3 4.0 57.6 65.3 919 46,515 2.0 100.0 924 47.450 100.0 GIXED AND NON-CURRENT ASSETS Tocal Fixed Assets Held-to-Maturity Investments svestment in Joint Ventures Loans and other receivables Other Operating Non-Current Assets Derivatives Other Non-Current Assets Total Fixed Assets and Non-Current Assets INTANGIBLE ASSETS Total Intangible Assets TOTAL ASSETS CURRENT LIABILITIES Total Short Term Loans Trade Creditors Due to Related Parties Dividends Payable Tax Payable Other Creditors Accruals Derivatives Total Current Liabilities NON-CURRENT LIABILITIES Total Long Term Debt Total Other Non-Current Liabilities Total Non-Current Liabilities CAPITAL AND RESERVES 2.9 14.9 1.372 7.453 194 15.7 0.1 1.416 6,916 56 912 162 5,666 165 170 15.463 2.0 0.3 12.2 4.883 10.3 169 0.4 01 14.125 29.8 26.4 31.9 12.301 2.063 15.140 1.774 16,914 30.9 35.6 1.7 801 1.7 801 782 1.7 32.9 Ordinary Shares Other Reserves Retained Earnings Total Capital and Reserves TOTAL LIABILITIES 15,105 16.688 46.515 32.5 35.9 100.0 15,610 16.411 47.450 100.0 Using the above inform (1) Calculate liq (ii) Calculate activity ra (iv) Calculate coverag (v) Calculate prom (vi) Use the DuPont me he above information, complete a comprehensive ratio analysis for XYZ Ltd: lculate liquidity ratios: current and quick ratios. activity ratios: inventory holding period, debtors collection period. ce ratios: gearing ratio, debt-to-equity ratio, net debt to EBITDA, le coverage ratios interest coverage ratio, finance cost to sales. ale profitability ratios: gross profit margin, net profit margin. PuPont method, and after calculating the component ratios, compute the ROCE for this firm. (vii) Calculate All & Select a sto n's Z Score and appraise the bankruptcy risk. Tata Motors or Wal-Mart) and apply the analytical the financial position of the