Rushahed Manzur

March 22, 2017 Fu-Wang Foods Limited FINANCIAL RATIO ANALYSIS FIN 201 section : 04 Presented by,  Tarikul Haque Bari - Thank you our honorable instructor and faculty Farzana Huda  Mohiel -  Hafijur Rahman - Senior lecturer For being with us in this presentation Mumit Sraban  Md. Rushahed Manzur - FU-WANG FOOD LTD.  History:  Mission: Incorporated in February 1997 Commercial operation starts in august 1997 It got ISO-9002 Certification Award on 4th November, 1998 listed in Dhaka and Chittagong stock exchanges during July 2000. Produce more and more innovative and standard products. Increase customer satisfaction. FINANCIAL RATIO ANALYSIS LIQUIDITY RATIO DEBT RATIO ASSET MANAGEMENT RATIO PROFITABILITY RATIO CURRENT RATIO Ratio 2011 1.92 2012 1.82 2013 2.05 2014 2.47 2015 2.39 3 2.5 2 Ratio Year Current ratio was going up but went down IA=4.1 Liquidity: Weak Cash conversion will be slow - 2012 2013 Year 2014 2015 Quick Ratio Ratio 2011 1.51 2012 1.33 2013 1.51 2014 1.91 2015 1.85 2.5 2 Ratio Year 1.5 1 0.5 Quick ratio was going up as well but went down at last 0 IA=- Inventory: high Food company with more inventory is good. 2013 Year 2014 2015 Year Ratio 2011 0.269 2012 0.277 2013 0.281 2014 0.298 2015 0.299 Debt ratio is going up IA=.42 Less debt from creditor Liability will be less Ratio Debt Ratio - 2012 2013 Year 2014 2015 Times Interest Earn Ratio Ratio 2011 13.09 2012 20.89 2013 8.88 2014 8.18 2015 10.40 25 20 Ratio Year Tie ratio was going down but went up last IA=6.5 Safe margin of interest charge Interest expense will be less - 2012 2013 Year 2014 2015 Year Year Ratio Ratio - 1.82 1.92 - 1.83 1.82 - 2.05 1.74 - 1.79 2.47 - 1.72 2.39 Ratio Fixed Assets Turnover - 2012 2013 Year 2014 2015 Inventory Turnover Ratio 6 Ratio Ratio 5 - 1.92 5.28 4 - 1.82 4.48 - 2.05 4.27 2 - 2.47 4.20 1 - 2.39 3.29 0 Ratio Year Year 3 2011 2012 2013 Year 2014 2015 Days Sales Outstanding 120 Ratio Ratio 100 - - 80 - - - - - - - - Days Year Year 60 - 2012 2013 Year 2014 2015 Total Assets Turnover 0.9 0.8 RATIO 2011 0.77 2012 0.80 2013 0.75 2014 0.69 2015 0.62 0.7 0.6 Ratio YEAR - 2012 2013 Year 2014 2015 Profit Margin Ratio 0.16 Ratio Ratio 0.14 - 1.92 0.11 0.12 - 1.82 0.09 0.1 - 2.05 0.07 - 0.07 2.47 - 0.13 2.39 Ratio Year Year - 2012 2013 Year 2014 2015 Year Year- Ratio Ratio- - - - - Ratio Return on Assets - 2012 2013 Year 2014 2015 Return on Equity 0.14 Ratio Ratio - 1.92 0.11 - 1.82 0.10 - 2.05 0.07 - 0.07 2.47 - 0.11 2.39 0.1 Ratio Year Year 0.12 - 2012 2013 Year 2014 2015 Earnings Per Share EPS Ratio Ratio - 1.92 1.48 - 1.82 1.41 - 2.05 0.94 - 0.82 2.47 - 1.52 2.39 1.4 1.2 Ratio Year Year 1.6 1 - 2012 2013 Year 2014 2015 Key Findings Fu Wang has a satisfactory gross profit ratio throughout the 5 years. They should maintain consistency. Inventory turnover ratio of the company is too lower than its industry average. Thus the company should increase the utilization of its inventory. ROA of the company is not satisfactory as its assets are not properly used. ROE for Fu Wang has dissatisfactory result. They should reduce their debt in proportion to their profit. The debt ratio Fu Wang’s condition is satisfactory. They should maintain this condition in the future. The market the EPS rate of Fu Wang is not satisfactory. It should increase its profit and try not to issue more common stock. Recommendation and Conclusion FU Wang Foods Limited is not in a good condition. Its current and fixed assets are not properly used; inventory also remains unused; debt is high. DSO, ROA, ROE, EPS are far away from their industry average. But the sales are high and so Net Profit Margin ratio, TIE and Debt ratio is satisfactory. Questions & Discussion THANK YOU