Study the following comparative profit and loss and financial position statements for Phoenix Energy for the years 2015 and 2016. The current market price for Phoenix Energy is OMR 0.420 Instructions: Based on the information provided, a. Examine the following ratios for the years 2015 and 2016. 20 marks 1. Earnings per share. 2. Inventory turnover 3. Total assets turnover. 4. Times interest earned. 5. Operating profit margin. b. Critically evaluate the profitability and the efficiency of the company over the two- year period. 5 marks Phoenix Energy Statement of Profit and Loss Year ended 31 December 2016 Revenue Cost of sales Gross profit Other income Selling, administrative and general expenses Profit from operations Finance income Gain on investments at fair value through profit or Finance cost Profit for the year before taxation Taxation Profit and total comprehensive income for the 2016 OMR 22,159,815 (17,181,335) 4,978,480 152,525 (3,145,672) 1,985,333 64,671 516,748 2015 OMR 17,282,950 (13,550,554) 3,732,396 58,700 (2,199,778) 1,591,318 104,763 190,164 loss (282,320) 2,284,432 (332,657) 1,951,775 (266,794) 1,619,451 (312,233) 1,307,218 2015 OMR 9,747,995 424,739 70,216 10,242,950 5,724,791 5,569,284 2,481,785 37,500 1,000,000 200,000 154,486 15,167,846 25,410,796 Phoenix Energy Statement of Financial Position At 31 December 2016 2016 Assets OMR Non-current assets Property, plant and equipment 10,115,906 Technology transfer fee 602,321 Deposit with leasing and finance companies 500,000 Deferred tax asset 64,903 Total non-current assets 11,283,130 Current assets Inventories 5,278,004 Trade and other receivables 5,148,595 Investments at fair value through profit and loss 1,973,496 Amount due from related parties 19,781 Deposit with leasing and finance companies Bank deposits 200,000 Cash in hand and at banks 1,085,824 Total current assets 13,705,700 Total assets 24,988,830 Equity and liabilities Equity Share capital 6,050,000 Share premium 5,236,345 Share-based payments reserve 167,700 Legal reserve 1,984,082 Retained earnings 2,684,838 Total equity 16,122,965 Liabilities Non-current liabilities Long term loans 3,520,478 Deferred government grant 37,037 End of service benefits 275,847 Total non-current liabilities 3,833,362 Current liabilities Trade and other payables 3,648,635 Bank borrowings 125,766 Amount due to related parties 9,182 Current portion of term loans 1,248,920 Total current liabilities 5,032,503 Total liabilities 8,865,865 Total equity and liabilities 24,988,830 Net assets per share 0.266 6,050,000 5,236,345 1,763,819 2,163,326 15,213,490 4,499,679 52,787 229,184 4,781,650 4,142,737 405,862 25,934 841,123 5,415,656 10,197,306 25,410,796 0.251
