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Abbott Pakistan

Current Ratio Liquidity Ratios Items current assets current liabilities Cash & equivalent + A/R current liabilities Average account receivable (Sales/360) Average inventory (CGS/360) Average accounts payable (CGS/360) (Rs.'000,000) Calculation 3,259 1,606 1,584 1,606 234 8,450 Days Days to sell inventory 1,675 5,989 Days Payable Days 1,606 4,526 Days Liquidity: -It is showing that short-term financial position is stable and the company is able to pay its current liabilities from its current assets in the period of 12months. The collection period of the company is better and it decreases the risk of bad debts. The inventory turnover days are high. Payable period is more than 4 months -From the statement of financial position I have extracted that the Company manages liquidity risk by maintaning sufficient cash and bank balance and adequate funding from short term borrowings. 130 102 2009 Ratios 2.03 times 0.99 times 10

Quick ratio

Collection period

tt Pakistan

Abbott Pakista
Profitaility ratios Items Gross Profit margin Gross Profit Sales Operating Profit margin Operating Income Sales Profit before Tax Sales Net income Sales (Rs.'000,000) Calculation 2,462 8,450 1,169 8,450 1,166 8,450 826 8,450 2009 % 29%


Pretax profit margin


Net profit margin


Profitability: -It measures the return earned by the company during a period.The Gross Profit margin is better ,it is at 29% . -The operating profit margin is 14% and operating expenses are 15%. -The pretax profit margin is also 14% because the company is not paying high finance cost.

-The company's net profit margin is only 10% because of high costs. Control over overheads are weak because sunk costs high in which Depreciation is at 121m.

Abbott Pakistan

Abbott Pakista
Capital Structure & Solvency ratios Items Debt to Equity Ratio Total Debt Total Equity (Rs.'000,000) Calculation 120 3,238 Ratios 4% 96% 4%

Debt to Asset Ratio

Total Debt Total Asset

120 1,705 7%

Interest Coverage

PBIT Interest expense Debt Capital Employed

1,169 2 120 3,358

585 times 4%

Debt to Capital Employed

Solvency: Debt is 4% and Equity is 96% which shows that if revenue decreases the copmpany will be able to pay its long term debts. - 7% assets are financed by debt. -Interest is 585 times covered., that is very high.

bbott Pakistan

Abbott Pakist
Return on assets Return on Investment Net Income Average total Assets Net Income Average Common Equity (Rs.'000,000) 826 17% 4,964 826 3,238 26% 2009 Return on common Equity

ROI: -The return on total assets is the return earned by the company on its assets which in the current situation is 17% and the return on common equity is 26% which is better. -When ROI increases in that time risk of insolvency also tends to increase this may effect the beta and also the price earning ratio.

bbott Pakistan

Abbott Pakista
Cash Turnover Asset utilization Revenue Cash and Equivalent Revenue Average Receivables CoGS Average Inventory Revenue Average working capital Revenue Average PPE Revenue Average total Assets (Rs.'000,000) 8450 771 8,450 234 5,989 1,675 8,450 1,653 8,450 1663 8,450 1,705 Times 11 Account receivable Turnover 36

Inventory Turnover

Working Capital Turnover

PPE Turnover

Fixed Asset Turnover

Asset Utilization: -The company is generating Rs. 11m cash for every Rs. 1m of revenue. -Receivable turn over is 36 times which shows that the company is collecting cash faster. -Inventory turnover is low becuase the company is holding inventory for longer periods So, we can not conclude that the inventory mangement of the comapny is not good as the turnover is low. -The working capital turnover shows that the company generates Rs.5m of revenue for every Rs. 1m of working capital.

bbott Pakistan

Abbott Pakista
Market Measures Price to Earning Ratio Market Price per share Earning per Share Earning Yield Earning per Share Market Price per share Dividend per share Market Price per share Dividend per share Earning per Share Market price per share Book Value per share (Rs.'000,000) 105.00 8.43 8.43 105.00 0.01 105.00 0.01 8.43 105.00 0.03 12.46 8%

Dividend Yield


Dividend Payout Rate


Price to Book


Market Measures: -Price to earning ratio of 12.46 is good because the company is earning Rs. 8.43 for each share. -The company is giving earnings at 8% and very less percentage of dividend. -Dividend payout rate is 14% only.

bbott Pakistan