SAN MIGUEL CORPORATION AND SUBSIDIARIES

STATEMENTS OF FINANCIAL POSITION

MARCH 31, 2018 AND DECEMBER 31, 2017

(In Millions)

ASSETS

Current Assets 2018 2017

Cash and cash equivalents Ᵽ 236,608 Ᵽ 206,073
Trade and Other receivables- net 122,972 116,040
Inventories 113,555 102,575
Current portion of biological assets-net 3,630 3,422
Prepaid Expenses and other current assets 81,502 78,228

Total Current Assets 558,267 506,338

Noncurrent Assets
Investments and advances- net 36,341 35,537
Financial assets at fair value through
Other comprehensive income 42,040 42,069
Property, plant and equipment - net 589,876 523,586
Investment property - net 7,800 7,162
Biological assets – net of current portion 2,789 2,695
Goodwill - net 131,542 60,124
Other intangible assets - net 134,542 134,438
Deferred tax assets 19,721 18,412
Other noncurrent assets - net 58,355 49,282

Total Noncurrent Assets 1,022,523 873,305

Total Assets Ᵽ 1,580,790 Ᵽ 1,379,643

LIABILITIES AND EQUITY

Current Liabilities
Loans payable Ᵽ 178,293 Ᵽ 149,863
Accounts payable and accrued expenses 142,927 136,993
Finance lease liabilities – current portion 17,869 16,889
Income and other taxes payable 21,543 16,653
Dividends payable 5,912 4,429
Current maturities of long –term debt -
Net of debt issue costs 41,256 36,944

Total Current Liabilities 407,800 361,771

Noncurrent Liabilities
Long-term debt – net of current maturities and
Debt issue costs 501,314 362,548
Deferred tax liabilities 21,526 20,674
Finance lease liabilities – net of current portion 136,617 138,008
Other noncurrent liabilities 26,608 25,580

Total Noncurrent Liabilities 686,065 546,810

EQUITY

Equity Attributable to Equity Holders of the Parent Company

Capital stock - common 16,436 16,435
Capital stock - preferred 10,187 10,187
Additional paid-in capital 177,781 177,750
Equity reserves (5,627) (4,799)
Retained earnings:
Appropriated 66,690 66,890
Unappropriated 147,822 143,335
Treasury stock (109,501) (109,501)
303,788 300,297
Non-controlling interests 183,137 170,765

Total Equity 486,925 471,062

Total Liabilities and Owner’s Equity Ᵽ 1,580,790 Ᵽ 1,379,643

 SAN MIGUEL CORPORATION AND SUBSIDIARIES
STATEMENTS OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED MARCH 31, 2018 AND 2017

2018 2017
Sales Ᵽ 234,347 Ᵽ 195,762
Cost of sales 183,675 151,352
Gross Profit 50,672 44,410
Selling and administrative expenses (17,985) (16,897)
Interest expense and other financing charges (8,952) (8,200)
Interest income 1,373 995
Equity in net earnings of associates and joint ventures 46 144
Gain (loss) on sale of investments and property equipment
8 (28)
Other charges - net (4,217) (1,104)
Income before income tax 20,945 19,320
Income tax expense 5,336 5,492

Net income Ᵽ 15,609 Ᵽ 13,828

Horizontal Analysis
San Miguel Corporation
Statement of Financial position
As of December 31, 2018

ASSETS

Current Assets 2018 2017 Ᵽ %

Cash and cash equivalents Ᵽ 236,608 Ᵽ 206,073 30,535 14.82
Trade & other receivable - net 122,972 116,040 6,932 5.97
Inventories 113,555 102,575 10,980 10.70
Current portion of biological assets - net 3,630 3,422 208 6.08
Prepaid Expenses 81,502 78,228 3,274 4.19
Total Current Assets 558,267 506,338 51,929 10.26
Investments & advances – net 36,341 35,537 804 2.26
Financial Assets….. 42,040 42,069 (29) -0.07
Property, plant and equipment 589,876 523,586 66,290 12.66
Investment property - net 7,800 7,162 638 8.91
Biological asset – net of current portion 2,789 2,695 94 3.49
Goodwill - net 131,542 60,124 71,418 118.78
Other intangible asset - net 134,542 134,438 104 0.08
Deferred tax asset 19,721 18,412 1,309 7.11
Other noncurrent asset - net 58,355 49,282 9,073 18.41
Total Assets 1,580,790 1,379,643 201,147 14.58
Loans Payable 178,293 149,863 28,430 18.97
Accounts Payable & Accrued Payable 142,927 136,993 5,934 4.33
Finance lease liabilities – current portion 17,869 16,889 980 5.80
Income and other taxes payable 21,543 16,653 4,890 29.36
Dividends Payable 5,912 4,429 1,483 33.48
Current maturities of long-term debt 41,256 36,944 4,312 11.67
Total Current Liabilities 407,800 361,171 46,629 12.91
Long-term debt 501,314 362,548 138,766 38.28
Deferred tax liabilities 21,526 20,674 852 4.12
Finance lease liabilities 136,617 138,008 -1,391 -1.01
Other noncurrent liabilities 26,608 25,580 1,028 4.02
Total Liabilities 1,093,865 970,981 122,884 12.66
Capital stock - common 16,436 16,435 1 6.08
Capital stock - preferred 10,187 10,187 0 0
Additional paid in capital 177,781 177,750 31 0.02
Equity reserves (5,627) (4,799) -828 17.25
Retained earnings:
Appropriated 66,690 66,890 -200 -0.30
Unappropriated 147,822 143,335 4,487 3.13
Treasury stock (109,501) (109,501) 0 0
Non-controlling interests 183,137 170,765 12,372 7.25
Total Equity 486,925 471,062 15,863 3.37

Total Liabilities and Owner’s equity Ᵽ 1,790,821 Ᵽ 1,379,643 139,607 14.58

Horizontal analysis (also known as trend analysis) is a financial statement analysis technique that shows
changes in the amounts of corresponding financial statement items over a period of time. It is a useful tool
to evaluate the trend situations. To get the percentage change of the horizontal analysis, we need to get
the peso change first. In getting the peso change we need to subtract the current year to the prior year. And
for the percentage change we need to divide the difference to the prior year and multiply it to 100. We
noticed in the horizontal analysis that the outcome is not consistent in increasing. In the first look you can
see that the company is doing good but when you get the percentage change you will see that it is not
consistent.

Vertical Analysis
San Miguel Corporation
Statement of Financial Position
ASSETS

Current Assets 2018 % 2017 %

Cash and cash equivalents Ᵽ 236,608 14.97 Ᵽ 206,073 14.94
Trade & other receivable - net 122,972 7.78 116,040 8.41
Inventories 113,555 7.18 102,575 7.43
Current portion of biological assets - net 3,650 0.23 3,422 0.25
Prepaid Expenses 81,502 5.16 78,228 5.67
Total Current Assets 558,267 35.32 506,338 36.70
Investments & advances - net 36,341 2.30 35,537 2.58
Financial assets….. 42,040 2.66 42,069 3.05
Property, plant and equipment 589,876 37.32 523,586 37.95
Investment property - net 7,800 0.49 7,162 0.52
Biological asset – net of current portion 2,789 0.18 2,695 0.20
Goodwill - net 131,542 8.32 60,124 4.36
Other intangible asset - net 134,542 8.51 134,438 9.74
Deferred tax assets 19,721 1.25 18,412 1.33
Other noncurrent asset - net 58,355 3.69 49,282 3.57
Total Assets 1,580,790 100% 1,379,643 100%
Loans Payable 178,293 11.28 149,863 10.86
Accounts Payable 142,927 9.04 136,993 9.93
Finance lease liabilities 17,869 1.13 16,889 1.22
Income and other payables 21,543 1.36 16,653 1.21
Dividends payable 5,912 0.37 4,429 0.32
Current Maturities of long term debt 41,256 2.60 36,944 2.68
Total Current Liabilities 407,800 25.80 361,171 26.18
Long term debt 501,314 31.71 362,548 26.28
Deferred tax liabilities 21,526 1.36 20,674 1.50
Finance lease liabilities 136,617 8.64 138,008 9.93
Other noncurrent liabilities 26,608 1.68 25,580 1.85
Total Noncurrent Liabilities 686,065 43.40 546,810 39.63
Capital stock - common 16,436 1.04 16,435 1.19
Capital stock - preferred 10,187 0.64 10,187 0.74
Additional paid in capital 177,781 11.25 177,750 12.88
Equity reserves (5,627) -0.36 (4,799) -0.35
Retained earnings:
Appropriated 66,070 4.22 66,890 4.85
Unappropriated 147,822 9.35 143,335 10.39
Treasury stock (109,501) -6.93 (109,501) 7.94
Non-controlling interest 183,137 11.59 170,765 12.38
Total Equity 486,925 30.80 471,062 34.14

Total Liabilities and Owner’s equity Ᵽ 1,580,790 100% Ᵽ 1,379,643 100%

Vertical Analysis is a method of financial statement analysis in which each line item is listed as a
percentage of a base figure within the statement. In getting the vertical analysis we need to divide all the
accounts one by one written from the financial statement and then multiply it to 100. We also noticed that
the result is not consistent , sometimes its decreasing sometimes its increasing.

A. Profitability Ratios

Name of Ratio Formula Ratio 2018

Gross Profit Gross Profit 瀀䂱 㹀錳
Margin Net Sales 錳Ͳ 䂱Ͳ 㹀 21.62%
Gross Profit Rate Net Sales − Cost of good sold 錳Ͳ 䂱Ͳ 㹀 − ͶͲ䂱 㹀
Net Sales 錳Ͳ 䂱Ͳ 㹀 21.63%
Operating Income Operating Income 錳瀀䂱
Net Sales 錳Ͳ 䂱Ͳ 㹀 8.94%
Net Profit Margin Net Income 䂱 瀀
Net Sales 錳Ͳ 䂱Ͳ 㹀 6.66%
Return on Assets Net Income 䂱 瀀
Average Assets 䂱 Ͷ瀀䂱錳 ‶ 1.05%
Average Asset Total Assets + Total Assets 錳 䂱 Ͷ瀀䂱㹀 瀀 + 䂱Ͳ㹀 䂱 Ͳ
錳 錳 1,480,216.5
Return on Equity Net Income 䂱 瀀
Average Equity 㹀Ͷ䂱 Ͳ‶ 3.26%
Average Equity Total Equity + Total Equity 錳 Ͷ 䂱 錳 + 㹀 䂱瀀 錳
錳 錳 478,993.5

Profitability Ratio are financial metrics used by analysts and investors to measure and evaluate the ability
of a company to generate income (profit) relative to revenue, balance sheet assets, operating costs, and
shareholders’ equity during a specific period of time. It will show how well a company utilizes its assets to
produce profit and value to shareholders. The average asset of the company is large. Only three percent of
the equity returned to the owner. The result of the Gross Profit Margin and Gross Profit Rate almost have
the same percentage.

B. Operational Efficiency Ratios

Name of Ratio Formula Ratio 2018

Asset Turnover Net Sales 錳Ͳ 䂱Ͳ 㹀
Average Asset 䂱 Ͷ瀀䂱錳 ‶ 0.16%
Fixed Asset Turnover Net Sales 錳Ͳ 䂱Ͳ 㹀
Average Fixed Asset 䂱㹀Ͳ 0.42%
Inventory Turnover Cost of Good Sold ͶͲ䂱 㹀
Average Inventory 䂱Ͷ 錳‶ 1.11%
Days in Inventory Ͳ Ͳ
Inventory Turnover ‶ 329 days
Accounts Receivable Net Sales 錳Ͳ 䂱Ͳ 㹀
Turnover Average Accounts Receivable 䂱 瀀 1.96%
Days in Accounts Ͳ Ͳ
receivable / Average Accounts Receivable Turnover ‶ 186 days
Collection Period

Formula 2
Days in Inventory Average Inventory 䂱Ͷ 錳‶
Average Daily Cost of Good Sold 瀀Ͳ‶錳 328 days
Days in Accounts Average Accounts Receivable 䂱 瀀
Receivable Average Daily Sale 錳 186 days
Average Daily Sales Sales 錳Ͳ 䂱Ͳ 㹀
Ͳ Ͳ 642
Average Accounts AR beg + AR end 錳錳䂱 㹀錳 + 䂱瀀 瀀
Receivable 錳 錳 119,506

Operational Efficiency Ratio is also used to analyze how well a company uses its assets and liabilities
internally. An efficiency ratio can calculate the turnover of receivables, the payment of liabilities, the
quantity and usage of equity, and the general use of inventory and machinery. This ratio can also be used
to track and analyze the performance of commercial and investment banks. We noticed that the operational
efficiency ratio’s outcome is consistent in increasing. Although the days are different, the outcome are still
almost the same.

C. Financial Health

Solvency

Debt to Equity Total Debt 䂱瀀 Ͳ䂱Ͷ

Equity Ͷ 䂱 錳 2.25
Debt Ratio Total Debt 䂱瀀 Ͳ䂱Ͷ
Total Assets 䂱 Ͷ瀀䂱㹀 瀀 0.69
Interest Coverage Ratio Operating Income 錳瀀䂱
Interest Expense Ͷ䂱 錳 2.34

Liquidity

Current Ratio Current Assets 㹀 䂱㹀

Current Liabilities 瀀㹀䂱Ͷ瀀瀀 1.17
Quick Ratio Quick Assets Ͳ 䂱 Ͷ瀀
Current Liabilities 瀀㹀䂱Ͷ瀀瀀 0.88

Financial health is a term used to describe the state if one’s person financial situation. There are many
dimensions to financial health, including the amount of savings you have, how much are setting away for
retirement and how much of your income you are spending on fixed or non-descretionary expenses. There
are two types of financial health; the solvency ratio and the liquidity ratio. Solvency Ratio is used to
measure the ability of a company to meet its long term debts Moreover, the solvency ratio quantifies the
size of a company’s after tax income, not counting non-cash depreciation expenses, as contrasted to the
total debt obligations of the firm. Liquidity Ratio is a financial ratio that indicates whether a company’s
current assets will be sufficient to meet the company’s obligations when they become due. The result of the
debt ratio is very low which is good for the company.
 PERFORMANCE TASK

A REPORT IN FUNDAMENTALS IN ACCOUNTANCY AND BUSSINESS MANAGEMENT 2

SUBMITTED BY: PEACE COMMITTEE

GROUP MEMBERS

MA. HANNAH DC. CARURUCAN

STEVEN T. DE GUZMAN

CHANTAL NICOLE M. BONIFACIO

ZEID MITZI S. CABALES

ABEGAIL D. CIRILO

ALLEN YSSER DADANG

ARYL ROUE ESGUERRA

SUBMITTED TO:

MRS. NICENA MONTANO

TEACHER