FRASER & NEAVE HOLDINGS BHD

YEAR 2015 2016

RATIO
LIQUIDITY

1. Current ratio = 1,565,398 1,626,534

= =
446,389 451,149
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑎𝑠𝑠𝑒𝑡𝑠
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠 = 3.5068 = 3.6053

For every, $1 of current debt, F&N has more than enough to cover its
current liability if they come due in both years.
 LIQUIDITY

2. Quick or acid-test ratio =

847,705 800,419
𝐶𝑎𝑠ℎ + 𝑆ℎ𝑜𝑟𝑡−𝑡𝑒𝑟𝑚 𝑖𝑛𝑣𝑒𝑠𝑡𝑚𝑒𝑛𝑡𝑠 + 𝐴𝑐𝑐𝑜𝑢𝑛𝑡𝑠 𝑟𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒 (𝑛𝑒𝑡)
= =
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠 446,389 451,149

= 1.8990 = 1.7742

In 2015, F&N has $1.90 of liquid assets available to cover each $1 of current
liabilities. In 2016, F&N has $1.77 of liquid assets available to cover each $1
of current liabilities.
 LIQUIDITY

3. Current cash debt coverage = 224,840 184,667

= =
(446,389 + 494,613)Τ2 (451,149+446,389)/2
𝑁𝑒𝑡 𝑐𝑎𝑠ℎ 𝑝𝑟𝑜𝑣𝑖𝑑𝑒𝑑 𝑏𝑦 𝑜𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑎𝑐𝑡𝑖𝑣𝑖𝑡𝑖𝑒𝑠
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑐𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠 =
224,840
=
184,667
470,501 448,769

= 0.4779 = 0.4115

The current cash debt coverage ratio is the company’s ability to pay its
short-term obligations. Thus, in both the years F&N can only cover 47.79
cents and 41.45 cents respectively.
 YEAR 2015 2016
RATIO
ACTIVITY

1. Accounts receivable turnover

2,103,793 1,978,622
=
= =
(332,462 +359,624)Τ2 (321,072+332,462)/2

𝑁𝑒𝑡 𝑠𝑎𝑙𝑒𝑠 2,103,793 1,978,622

𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑛𝑒𝑡 𝑎𝑐𝑐𝑜𝑢𝑛𝑡𝑠 𝑟𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒 = =
346,043 326,767

= 6.0796 times = 6.0551 times

F&N’s accounts receivable turned over 6.0796 and 6.0551 in 2015 and 2016
respectively. This indicates that the average account receivable was collected in 60.0
days and 60.3 days accordingly.
 ACTIVITY

2. Inventory turnover 1,425,111 1,250,256

= =
(253,918 + 274,819)Τ2 (247,332+253,918)/2
𝐶𝑜𝑠𝑡 𝑜𝑓 𝑔𝑜𝑜𝑑𝑠 𝑠𝑜𝑙𝑑
= = 5.3906 times = 4.9886 times
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑖𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦

Inventory turnover measures how fast a company is selling inventory. In

2015 inventory turns over 5.39 times a year and is on hand for
approximately 67.7 days. In 2016, inventory turns over 4.99 times a year
and is on hand for approximately 73.1 days.
 ACTIVITY
3. Asset turnover
2,103,793 1,978,622
= =
𝑁𝑒𝑡 𝑠𝑎𝑙𝑒𝑠 3,142,869 + 2,679,105Τ2 (3,772,872+3,142,869)/2
=
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑡𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠
2,103,793 1,978,622
= =
2,910,987 3,457,870.50

= 0.7227 = 0.5722

For every dollar in assets, F&N generated $0.72 in sales during 2015.
While in 2016, F&N generated $0.57 in sales.
 YEAR 2015 2016
RATIO
PROFITABILITY

1. Profit margin on sales

719,229 165,658
= =
𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒 2,103,793 1,978,622
=
𝑁𝑒𝑡 𝑆𝑎𝑙𝑒𝑠
= 0.3419 = 0.0837
= 34.19% = 8.37%

Indicates how much out of every dollar of sales F&N company actually earns. In 2015, a
profit margin of 34.19% mean the company has a net income of $0.34 for each dollar of
total revenue earned. In 2016, a profit margin of 8.37% mean the company has a net
income of $0.08 for each dollar of total revenue earned.
 PROFITABILITY

2. Return on assets 719,229 165,658

= =
(3,142,869 + 2,679,105)Τ2 (3,772,872+3,142,869)/2
𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒
=
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑡𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠
719,229 165,658
= =
2,910,987 3,457,870.50
= 0.2471 = 0.0479
= 24.71% = 4.79%

Every dollar that F&N invested in assets in 2015 generated 25 cents of net
income. On the other hand, in 2016 every dollar used to purchase assets
translated into 5 cents of net income.
 YEAR 2015 2016
RATIO

COVERAGE

1. Debt to assets ratio 586,792 620,328

= =
3,772,872
3,142,869
𝑇𝑜𝑡𝑎𝑙 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠
= = 0.1867 = 0.1644
𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠

= 18.67% = 16.44%

In 2015, 18.67% of F&N’s assets have been financed by debt, while in

2016 16.44% have been financed by debt.
 COVERAGE

2. Cash debt coverage =

224,840
𝑁𝑒𝑡 𝑐𝑎𝑠ℎ 𝑝𝑟𝑜𝑣𝑖𝑑𝑒𝑑 𝑏𝑦 𝑜𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑎𝑐𝑡𝑖𝑣𝑖𝑡𝑖𝑒𝑠 = =
184,667
586,792+676,724Τ2 (620,328+586,792)/2
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑡𝑜𝑡𝑎𝑙 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠
224,840 184,667
= =
631,758 603,560

= 0.3559 = 0.3060

In 2015, a ratio of 0.36 indicates that for every dollar of total liabilities
there were 36 cents of net cash provided by operating activities. In 2016,
a ratio of 0.31 indicates that for every dollar of total liabilities there were
31 cents of net cash provided by operating activities.