APEX FOODS

CURRENT RATIO Current ratio 2010 1.69 2011 1.36

Comments: Current ratio deteriorates from 2010 to 2011. And in both years it was much below the standard of 2: 1 Analysis: From the chart it is seen that 2011 current ratio figure shows deterioration over 2010 figure. General rule is that higher the current ratio better it is but there is a limit to this. A current ratio should be 2 or higher. Here although the ratios dont meet the thumb rule still as ratio is not below 1 it didnt meet the critical liquidity problems. Means that total current liabilities exceed total current assets .The company still got the ability to pay back its short-term liabilities (debt and payables) with its short-term assets (cash, inventory, receivables). QUICK RATIO Quick Ratio 2010 0.68 2011 0.39

Comments: Quick ratio decreases from 2010 to 2011. However in both years it was much below the standard of 1: 1. Analysis: Here as quick ratio is less than 1, it indicates that business would not be able to repay all its debts by using its most liquid assets. In both 2010 and 2011 the ratio is less than 1 and figure shows deterioration over 2010 figure in 2011. A quick ratio of 1.00 means that the most liquid assets of a business are equal to its total debts and the business will just manage to repay all its debts by using its cash, marketable securities and accounts receivable. A quick ratio of more than one indicates that the most liquid assets of a business exceed its total debts. Means a very high value of quick ratio may indicate inefficiency.
LONG TERM DEBT RATIO

Long term Debt

2010 0.146

2011 0.101

Comments: Long term debt to total asset ratio gets better from 2010 to 2011. ANALYSIS: For year 2011, Long term Debt Ratio of 0.10 indicates that the company has tk 0.10 in long term debt for each taka it has in assets. Same goes with year 2010 ratio where the company has tk 0.14 in long term debt for each taka it has in assets. The higher the level of long term debt, the more important it is for Apex Foods to have positive revenue and steady cash flow. It is very helpful for management to check its debt structure and determine its debt capacity. DEBT TO TOTAL ASSET RATIO
Debt to total asset ratio 2010 0.65 2011 0.73

Comments: Debt to total asset ratio deteriorates from 2010 to 2011. ANALYSIS: Year 2011 shows a higher ratio than 2010. Here in 2011, the debt to total assets ratio tells that 73% of the companys assets are financed by the creditors or debt and therefore 27% is financed by the owners. In 2010, the debt to total assets ratio tells that 65% of the Apex Foods assets are financed by the creditors or debt (and therefore 35% is financed by the owners). A higher percentage indicates more leverage and more risk. The higher the ratio, the greater risk will be associated with the companys operation. In addition, high debt to assets ratio may indicate low borrowing capacity of a firm, which in turn will lower the firm's financial flexibility. In 2011 the ratio is 0.73 to 1 and in 2010 the ratio is 0.65 to 1. Here the ratio is greater than 0.5, which means most of the company's assets are financed through debt. Apex food is said to be "highly

leveraged," as it has high debt/asset ratios. A company with a high debt ratio (highly leveraged) could be in danger if creditors start to demand repayment of debt. TIMES INTEREST EARNED RATIO 2010 2011 Times interest earned ratio 1.019 1.136

Comments: TIER increased significantly during 2011 ANALYSIS: Higher value of times interest earned ratio is favorable meaning greater ability of a business to repay its interest and debt. Lower values are unfavorable. Means from the above graph it is seen that Apex Foods have higher value of times interest earned ratio in 2011 than 2010 with a very low difference. Means that Apex foods is just enough to pay off its interest expense. ROE
Return on Equity 2010 2.10 % 2011 2.70 %

Comments: ROE gets better in 2011 ANALYSIS : ROE for 2010 is 2.10% and for 2011 is 2.70%, which will certainly make shareholders a bit happy because of the improvement. Higher values are generally favorable meaning that the company is efficient in generating income on new investment .Return on equity is an important measure of the profitability of a company. ROA Return on Assets 2010 0.75% 2011 0.73%

Comments: ROA deteriorates in 2011 compared to 2010 ANALYSIS: From the chart it is seen that in 2010 ROA was .74% and in 2011 ROA is .73%. Though the change is very negligible, still there is a minor overall deterioration in the performance of assets of Apex Foods in 2011. Higher values of return on assets show that business is more profitable.