Financial Report KTML

FINANCIAL REPORTING AND
ANALYSIS
Submitted To:
PROF. WASEEM UL REHMAN

Submitted By:
AHTSHAM KHALID
13-M
MUHAMMAD KAMRAN
36-A
MUHAMMAD ARSAL IQBAL 44-A

MUHAMMAD FAISAL SULTAN
13-A
BBA (5th Semester)

2012-2016
INSTITUTE OF BUSINESS ADMINISTRATION

UNIVERSITY OF THE PUNJAB
Table of Contents
Introduction:...........................................................................................4
Vision Statement:...................................................................................6
Mission Statement:.................................................................................6
Statement of Financial Position...............................................................7
Statement of Comprehensive Income....................................................9
Horizontal Analysis of Financial Statement...........................................10
Vertical Analysis of Financial Statement...............................................11
Ratio Analysis.......................................................................................13
Liquidity Ratios.....................................................................................16
Activity Ratios.......................................................................................21
Profitability Ratios.................................................................................33
Leverage Ratios....................................................................................42
Conclusion............................................................................................46
References............................................................................................48
Introduction:
The Company commenced Textile operations in 1953 as a private limited
company and became a public limited company in 1968. The Company is a
part of Kohinoor Maple Leaf Group (KMLG). KMLG structure comprises of two
listed public limited companies i.e. Kohinoor Textile Mills Limited (KTML) and
Maple Leaf Cement Factory Limited (MLCF) and one unlisted public limited
company i.e. Maple Leaf Capital Limited.
MLCF is subsidiary company of
KTML. The initial capacity of its Rawalpindi unit comprised 25,000 spindles
and 600 looms. Later, fabric processing facilities were added and spinning
capacity was augmented. Additional production facilities were acquired on
the Raiwind-Manga Road near Lahore in District Kasur and on the Gulyana
Road near Gujar Khan, by way of merger.
Nature of Business:
The Companys production facilities now comprise 156,528 ring spindles
capable of spinning a wide range of counts using cotton and Man-made
fibers. The weaving facilities at Raiwind comprise 204 looms capable of
weaving wide range of greige fabrics. The processing facilities at the
Rawalpindi unit are capable of dyeing and printing fabrics for the home
textile market. The stitching facilities produce a diversified range of home
textiles for the export market. Both the dyeing and stitching facilities are
being augmented to take advantage of greater market access. Fully
equipped laboratory facilities for quality control and process optimization
have been setup at all three sites. The Company has been investing heavily
in Information Technology, training of its human resources and preparing its
management to meet the challenges of market integration.
The Company continues to ensure that its current competitive position is
maintained as well as supporting the ongoing improvement process in our
endeavor to maintain worlds best manufacturing practice. Operations of the
Company are subject to different environmental and labour laws. The
Company is fully complying with all applicable environmental, labour,
corporate and other relevant legal laws.
Vision Statement:
The Kohinoor Textile Mills Limited stated vision is to achieve and then remain
as the most progressive and profitable Company in Pakistan in terms of
industry standards and stakeholders interest.
Mission Statement:
The Company shall achieve its mission through a continuous process of
having sourced, developed, implemented and managed the best leading
edge technology, industry best practice, human resource and innovative
products and services and sold these
to its customers, suppliers and stakeholders.
Statement of Financial Position
EQUITY AND LIABILITIES
2014
Rs.
(000)
2013
Rs.
(000)
2012
Rs.
(000)
2011
Rs.
(000)
2010
Rs.
(000)
37,00,
000
37,00,
000
3,700,0
00
3,700,0
00
3,700,0
00
300,00
0
4,000,
000
300,00
0
4,000,
000
300,00
0
4,000,0
00
300,00
0
4,000,0
00
300,00
0
4,000,0
00
24552
62
37136
59
61689
21
36738
25
24552
62
25440
07
49992
69
36738
25
2,455,2
62
2,059,4
75
4,514,
737
3,673,8
25
2,455,2
62
1,931,3
74
4,386,
636
3,685,4
97
1,455,2
62
1,906,0
06
3,361,
268
3,673,8
25
86399
38958
519,13
5
1,318,7
10
1,628,0
67
8037
NIL
20,501
42,843
67,005
31596
0
41039
6
35054
9
38950
7
140,17
5
679,81
1
62,141
1,423,6
94
157,99
6
1,853,0
68
11325
86
67049
58685
66
62789
62
12483
15
10410
1
43293
41
57623
9
62579
96
66475
03
1,161,8
92
185,69
8
4,364,1
11
617,85
6
6,329,5
57
7,009,
368
834,69
1
230,13
8
5,130,2
65
611,74
4
6,806,8
38
8,230,
532
1,040,2
57
289,98
7
6,070,4
35
768,45
9
8,169,1
38
10,022
,206
16121
708
15320
597
15,197
,930
16,302
,665
17,057
,299
Share capital and reserves

Authorized share capital
ordinary shares of Rupees 10 each
30,000,000 (2011: 30,000,000)
preference
shares of Rupees 10 each
Issued, subscribed and paid up share

capital
Reserves
Total equity
Surplus on revaluation of land and
investment properties
LIABILITIES
NON-CURRENT LIABILITIES
Long term financing
Liabilities against assets subject to
finance lease
Lease finance advance
Deferred income tax liability
CURRENT LIABILITIES
Trade and other payables
Accrued mark-up
Short term borrowings
Current portion of non-current liabilities
TOTAL LIABILITIES
93615
45753
16
CONTINGENCIES AND COMMITMENTS

TOTAL EQUITY AND LIABILITIES
ASSETS
NON - CURRENT ASSETS
Property, plant and equipment
Intangible asset
Investment properties
Long term investments
Long term deposits
59197
51
59591
12
6,161,3
81
6,747,6
91
6,496,2
99
NIL
17811
33
30146
69
3006
17298
43
32486
80
6,284
1,728,8
86
3,248,6
80
9,563
1,721,7
14
3,248,8
80
1,720,8
35
2,249,1
70
46637
10762
190
40382
10981
023
50,515
11,195,
746
35,758
11,763,
606
34,887
10,501,
191
42475
5
18881
77
90331
2
15851
8
36528
1
17682
03
10667
24
22327
2
320,48
6
1,529,9
49
986,68
3
312,40
6
328,39
3
1,657,2
52
707,40
0
241,33
1
345,79
8
2,393,1
13
1,329,0
65
596,79
5
17237
32585
25,909
19,045
15,578
NIL
6229
217
141
NIL
76199
7
97523
9
12934
6
10093
7
NIL
41252
1
308,49
4
46
601,14
4
432,94
3
1040
14286
7
32085
2
611
131,92
6
385,50
3
600
129,90
9
420,99
6
53595
18
43395
74
4,002,1
84
4,539,0
59
53595
18
16121
708
43395
74
15320
597
4,002,1
84
15,197
,930
4,539,0
59
16,302
,665
CURRENT ASSETS
Stores, spare parts and loose tools
Stock-in-trade
Trade debts
Advances
Security deposits and short term
prepayments
Accrued Interest
Due from subsidiary companies
Other receivables
Short term investments
Taxation recoverable
Cash and bank balances
Non-current assets classified as held for

sale
TOTAL ASSETS
401,92
8
642,11
1
99,805
78,851
5,903,1
85
652,92
3
6,556,1
08
17,057
,299
Statement of Comprehensive Income

2014
Rs.
(000)
15302
242
13395
079
2013
Rs.
(000)
14250
439
12116
187
2012
Rs.
(000)
11,146,
698
9,310,0
49
2011
Rs.
(000)
12,037,
253
10,213,
705
2010
Rs.
(000)
10,693,
338
8,692,5
29
19071
63
57359
2
31615
2
35225
8
92500
8
98216
1
87181
5
21342
52
43859
8
25839
8
1,836,
649
1,823,
548
402526
425,063
210356
218,739
2,000,
809
397,81
8
195,10
3
116011
-49,432
728893
1,107,7
56
693,234
1,130,3
14
-37,323
630,24
4
1,370,5
65
52455
67,273
595,770
78,651
18539
76
56538
4
14389
78
64054
3
1,175,
029
870,74
0
1,726,
084
1,037,2
94
1,449,
216
1,072,7
68
79843
5
31390
3
304,28
9
187,86
0
688,79
0
376,44
8
TAXATION
12885
92
11894
0
200,939
-98,587
PROFIT AFTER TAXATION
11696
52
48453
2
116,42
9
487,85
1
277,86
1
4.76
1.97
0.47
2.20
1.91
SALES
COST OF SALES
GROSS PROFIT
DISTRIBUTION COST
ADMINISTRATIVE EXPENSES
OTHER OPERATING EXPENSES
OTHER OPERATING INCOME
PROFIT FROM OPERATIONS

FINANCE COST
PROFIT BEFORE TAXATION
EARNINGS PER SHARE - BASIC

AND DILUTED (Rupees)
-50733
74772
9
13865
23
10
11
Horizontal Analysis of Financial Statement
Balance Sheet
Total Equity
Total Surplus on revolution of
property
Total non-current liabilities
Total current liabilities
2010
2011
Rupee
s
Rupees
Chan
ge
w.r.t
2010
%
2012
Chan
ge
w.r.t
2011
%
2013
Remar
ks
Rupees
Better
Better
Better
Better
4,514,
737
3,673,82
5
679,811
6,329,55
15,197,
930
2.92
(0.32)
(52.25)
(7.01)
11,195,7
46
4,002,18
4
15,197,
930
(4.83)
(11.83)
Poor
Poor
(6.78)
Poor
Chan
ge
w.r.t
2012
%
2014
Remar
ks
Rupees
Better
Better
Better
Better
4,999,26
9
3,673,82
5
389,507
6,257,99
15,320,
597
10.73
(42.70)
(1.13)
10,981,0
23
4,339,57
4
15,320,
597
(1.92)
8.43
Poor
Better
0.81
Better
Chan
ge
w.r.t
2013
%
Remar
ks
Remar
ks
Rupees
Better
Better
Better
6,168,92
1
3,673,82
5
410,396
5,868,56
16,121,
708
23.40
5.36
(6.22)
10,762,1
90
5,359,51
8
16,121,
708
(1.99)
23.50
Poor
Better
5.23
Better
3,361,26
8
3,673,82
5
1,853,06
8
17,057,
299
4,386,63
6
3,685,49
7
1,423,69
4
16,302,
665
30.51
0.32
(23.17)
(16.68)
10,501,1
91
6,556,10
8
17,057,
299
11,763,6
06
4,539,05
9
16,302,
665
12.02
(30.77)
Better
Poor
(4.42)
Poor
Net sales
Cost of sales
10,693,3
38
8,692,52
9
12,037,2
53
10,213,7
05
12.57
17.50
Better
Poor
11,146,6
98
9,310,04
9
(7.40)
(8.85)
Poor
Better
14,250,4
39
12,116,1
87
27.84
30.14
Better
Poor
15,302,2
42
13,395,0
79
7.38
10.56
Better
Poor
Gross profit
Selling and distribution expenses
Administrative expenses
Other operating expenses
Other operating income
2,000,8
09
397,818
195,103
37,323
78,651
1,823,5
48
425,063
218,739
49,432
595,770
(8.86)
6.85
12.11
32.44
657.49
Poor
Poor
Poor
Poor
Better
1,836,6
49
402,526
210,356
116,011
67,273
0.72
(5.30)
(3.83)
134.69
(88.71)
Better
Better
Better
Worse
Poor
2,134,2
52
438,598
258,398
50,733
52,455
16.20
8.96
22.84
(56.27)
(22.03)
Better
Poor
Poor
Better
Poor
1,907,1
63
573,592
316,152
35,258
871,815
Poor
Poor
Poor
Better
Better
Profit from operations

Finance cost
1,726,0
84
1,037,29
4
688,790
200,939
19.10
(3.31)
Better
Better
1,175,0
29
870,740
(31.93
)
(16.06)
Poor
Better
1,438,9
78
640,543
22.46
(26.44)
Better
Better
1,853,9
76
565,384
Profit/(Loss) before taxation

Provision for taxation
1,449,2
16
1,072,76
8
376,448
98,587
(10.64
)
30.78
22.35
(30.50)
1,562.
02
28.84
82.97
103.82
Better
Poor
304,289
187,860
(55.82)
(6.51)
Poor
Better
798,435
313,903
162.39
67.09
Better
Poor
Profit / (Loss) after taxation
277,861
487,851
75.57
Better
116,429
(76.13
)
poor
484,532
316.1
6
Better
Total equity and liabilities

Total non-current assets
Total current assets
Total assets
(4.42)
(6.78)
0.81
Better
Poor
better
5.23
Profit and Loss Account
Vertical Analysis of Financial Statement
(11.73)
Better
Better
1,288,59
2
118,940
61.39
(62.11)
Better
Better
1,169,6
52
141.4
0
Better
Balance Sheet
Total Equity
Total Surplus on revolution of
property
Total non-current liabilities
Total current liabilities
Total equity and liabilities
Total non-current assets
Total current assets
Total assets
2010
2011
2012
2013
2014
3,361,268
3,673,825
1,853,068
8,169,138
19.71
21.54
10.86
47.89
4,386,636
3,685,497
1,423,694
6,806,838
26.91
22.61
8.73
41.75
4,514,737
3,673,825
679,811
6,329,557
29.71
24.17
4.47
41.65
4,999,269
3,673,825
389,507
6,257,996
32.63
23.98
2.54
40.85
6,168,921
3,673,825
410,396
5,868,566
38.26
22.79
2.55
36.40
17,057,29
9
10,501,191
100.00
61.56
16,302,66
5
11,763,606
6,556,108
38.44
4,539,059
17,057,29
9
100.00
16,302,66
5
10,693,338
100.00
12,037,253
100.00 15,197,930
100.00
72.16
11,195,746
73.67
15,320,59
7
10,981,023
100.00 16,121,708
100.00
71.67
10,762,190
66.76
27.84
4,002,184
26.33
4,339,574
28.33
5,359,518
33.24
100.00 15,197,930
100.00
15,320,59
7
100.00 16,121,708
100.00
100.00
100.00
14,250,439
100.00
15,302,242
100.00
Profit and Loss Account

Net sales
Cost of sales
8,692,529
81.29
10,213,705
84.85
Gross profit
2,000,809
18.71
1,823,548
15.15
397,818
195,103
37,323
78,651
3.72
1.82
0.35
0.74
425,063
218,739
49,432
595,770
3.53
1.82
0.41
4.95
1,449,216
13.55
1,726,084
14.34
1,072,768
10.03
1,037,294
8.62
376,448
3.52
688,790
98,587
0.92
277,861
2.60
Selling and distribution expenses

Administrative expenses
Other operating expenses
Other operating income
Profit from operations
Finance cost
Profit/(Loss) before taxation
Provision for taxation
Profit/(Loss) after taxation
11,146,698
9,310,049
83.52
12,116,187
85.02
13,395,079
87.54
16.48
2,134,252
14.98
1,907,163
12.46
3.61
1.89
1.04
0.60
438,598
258,398
50,733
52,455
3.08
1.81
0.36
0.37
573,592
316,152
35,258
871,815
3.75
2.07
0.23
5.70
10.54
1,438,978
10.10
1,853,976
12.12
870,740
7.81
640,543
4.49
565,384
3.69
5.72
304,289
2.73
798,435
5.60
1,288,592
8.42
200,939
1.67
187,860
1.69
313,903
2.20
118,940
0.78
487,851
4.05
116,429
1.04
484,532
3.40
1,169,652
7.64
1,836,649
402,526
210,356
116,011
67,273
1,175,029
Interpretations of Vertical Analysis

From 2010 to 2011
In 2010 to 2011 the total equity of company has increased and also the
current liabilities have increased, current assets of the company has
decreased. It means company is unable to pay its short term obligations as
current liabilities are greater than current assets.
In 2010 to 2011 the gross profit of company has decreased and EBIT, EAT
has increased. Due to decrease in interest expenses company profit has
increased.
From 2011 to 2012

current liabilities have decreased, current assets of the company has slightly
decreased.
In 2011 to 2012 the gross profit of company has increased. EBIT and EAT has
decreased.
From 2012 to 2013

current liabilities almost remains same, current assets of the company has
increased.
In 2012 to 2013 the gross profit and EBIT of company has decrease. EAT
increased due to decrease in interest expense.
From 2013 to 2014

current liabilities decreased, current assets of the company has increased.
In 2013 to 2014 the gross profit has decreased .EBIT and EAT increased
maybe due to decrease in interest expense.
Ratio Analysis
ACTIVITY
RATIOS:
Inventory
Turnover
Ratio
Average
Inventory
Average
No of Days
in
Inventory
Receivable
Turnover
Ratio
Average
No of Days
in
Receivable
s
FORMULA
2014
Rs.(000)
2013
Rs.(000)
Cost of sales/
Average
Inventory
1339507
9/182819
0
7.33
times
closing
Inventory+op
ening
inventory/2
365/average
inventory
Sales/
Average
Receivables
365/Receivab
le Turnover
Ratio
1211618
7/164907
6
7.35
times
2012
Rs.
(000)
9310049/
1593600.
5
5.84
Times
2011
Rs.
(000)
1021370
5/202518
2.5
5.04
Times
2010
Rs.
(000)
8692529/
2086469.
5
4.16
Times
1768203
+188817
7/2
1529949
+176820
3/2
1657252
+152994
9/2
2393113
+165725
2/2
1779826
+239311
3/2
1,828,19
0
1,649,07
6
1593600.
50
2,025,18
3
2,086,47
0
365/7.33
365/7.35
365/5.84
365/5.04
365/4.16
49.8
days or
50 days
49.66
days or
50 days
62.5
Days or
63 Days
App.
72.42
Days or
73 Days
App
87.74
Days or
88 Days
App
1530224
2/985334
15.53
times
1425043
9/102668
8
13.88
times
1114669
8/151833
2
7.34
Times
1203725
3/143566
8
8.38
Times
1069333
8/154141
3
6.39
Times
365/15.5
3
365/13.8
8
365/7.34
365/8.38
365/6.39
23.50
Days or
24 Days
26.21
Days or
26 Days
49.73
Days or
50 Days
App
43.55Da
ys or 44
Days
App
57.12
Days or
58 Days
App
Payable
Turnover
Ratio
Average
No of Days
in
Payables
Fixed
Assets
Turnover
Ratio
Total
Assets
Turnover
Ratio
LIQUIDTY
RATIOS:
Net
working
capital
Current
ratio
Quick
ratio
DEBT
RATIOS:
Purchases/
Average
Payables
365/Payable
Turnover
Ratio
Sales/
Average
Fixed Assets
Sales/ Total
Assets
current
assetscurrent
liabilities
current
assets/curren
t liabilities
current assetInventory/cur
rent liability
1339507
9/119067
3
11.25
times
1211618
7/120559
0
10.05
times
9310049/
998291.5
1021370
5/937474
8692529/
945006
9.32
Times
10.89
Times
9.19
Times
365/11.2
5
365/10.0
5
365/9.32
365/10.8
9
365/9.19
32.44
Days or
32 days
36.31
Days or
36 Days
39.16
Days or
39 Days
App
33.52
Days or
34 Days
App
39.72
Days or
38 Days
App
1530224
2/768956
8
1425043
9/153230
52
1114669
8/152694
49
1203725
3/162665
58
1069333
8/169735
52
1.99
Times
0.93
Times
0.73
Times
0.74
Times
0.63
Times
1530224
2/161217
08
1425043
9/153205
97
1114669
8/151979
30
1203725
3/163026
65
1069333
8/170572
99
0.95
Times
0.93
Times
0.73
Times
0.74
Times
0.63
Times
53595185868566
43395746257996
40021846329557
45390596806838
65561088169138
-509048
1918422
2327373
2267779
1613030
5359518/
5868566
4339574/
6257996
4002184/
6329557
4539059/
6806838
6556108/
8169138
0.91
0.69
0.63
0.67
0.8
53595182312932/
5868566
0.52
43395742133484/
6257996
0.35
40021841850435/
6329557
0.34
45390591985645/
6806838
0.37
65561082738911/
8169138
0.47
Debt ratio
Total
liabilities/Tota
l assets
6278962/
1612170
8
0.39
6647503/
1532059
7
0.43
7009368/
1519793
0
0.46
8230532/
1630266
5
0.5
1002220
6/170572
99
0.58
Coverage
ratio
Ebit/Interest
1853976/
5653384
1438978/
640543
1175029/
870740
1726084/
1037294
3.28
2.25
1.35
1.66
1449921
6/107276
8
1.35
Gross
profit/sales
1907163/
1530224
2*100
12.46%
2134252/
1425043
9*100
14.98%
1836649/
1114669
8*100
16.48%
1823548/
1203725
3*100
15.15%
2000809/
1069333
8*100
18.71%
Operating
profit
margin
Operating
profit/sales
1853976/
1530224
2*100
12.11%
1438978/
1425043
9*100
10.10%
1175029/
1114669
8*100
10.54%
1726084/
1203725
3*100
14.33%
1449216/
1069333
8*100
13.55%
Net profit
margin
Net
profit/sales
1169652/
1530224
2*100
7.64%
484532/1
4250439
*100
3.40%
116429/1
1146698
*100
1.04%
487851/1
2037253
*100
4.05%
277861/1
0693338
*100
2.60%
Return on
assets
net profit
after tax/total
asset
1169652/
1612170
8*100
7.25%
484532/1
5320597
*100
3.16%
116429/1
5199730
*100
0.77%
487851/1
6302665
*100
2.99%
277861/1
7057299
*100
1.63%
Return on
equity
net profit
after tax/total
equity
1169652/
6168921
*100
18.96%
484532/4
999269*
100
9.69%
116429/4
514737*
100
2.58%
487851/4
386638*
100
11.12%
277861/8
361268*
100
8.27%
Earnings
per share
EAT/no of
common
shares
outstanding
1169652/
2455262
16
484532/2
4552621
6
116429/2
4552621
6
487851/2
2196457
2
277861/1
4552621
6
4.76
1.97
0.47
2.2
1.91
PROFITABI
LITY
RATIOS:
Gross
profit
margin
Liquidity Ratios
Net Working Capital 2010
Net working capital= current assets current liabilities
Net working capital= 6556108 8169138
= (1613030)
Current liabilities are greater than current assets by an amount of 1613030.

= (2267779)

= (2327373)

= (1918422)

= (509048)
Comments
Net Working Capital
The company has high current values of short term debts than its current
assets throughout the five years. From 2010 to 2012, net working capital is
continuously decreasing and it reflects that company may using more short
term loans than its current assets. But from 2013 to 2014 company showed a
significant increment in its net working capital, may be because of the
increasing in short term assets or company is paying its short term debts.
Current Ratio 2010

Current ratio=
current assets
current liability
Current ratio=
6556108
8169138
=0.80
For every one current liability, there is 0.80 current asset.
Current Ratio 2011

Current ratio=
current assets
current liability
Current ratio=
4539059
6806838
= 0.67
Current ratio 2012

Current ratio=
current assets
current liability
Current ratio=
4002184
6329557
Current ratio= 0.63

Current ratio 2013

Current ratio=
current assets
current liability
Current ratio=
4339574
6257996
Current ratio= 0.69

Current ratio 2014

Current ratio=
current assets
current liability
Current ratio=
5359518
5868566
Current ratio= 0.91

Comments
Current ratios
Overall company position for paying its short term obligation is improving.
Although in 2011and 2012 its current ratio is decreased by small amount but
in next 2 years it significantly improved its position to pay its short term
debts.
QUICK RATIOS
Quick ratio 2010

Quick ratio=
current assetsinventories
current liability
Quick ratio=
65561082738911
8169138
= 0.47
For every one current liability, there are 0.47 current asset minus inventories.
Quick ratio 2011

Quick ratio=
current liability
Quick ratio=
45390591985645
6806838
= 0.37
Quick ratio 2012

Quick ratio=
current liability
Quick ratio=
40021841850435
6329557
= 0.34
Quick ratio 2013

Quick ratio=
current liability
Quick ratio=
43395742133484
6257996
= 0.35
Quick ratio 2014

Quick ratio=
current liability
Quick ratio=
53595182312932
5868566
= 0.52
Comments
Quick Ratio
From 2011 to 2013 quick ratio is decreasing and relatively stable. But in
2014 it is increased it means that company management is able to sell its
inventory effectively may be because of large sales and less inventory stocks
or company is paying off its short term debts.
Activity Ratios
Inventory turnover ratio 2010
Inventory turnover ratio=
cost of goods sold

averageinventory
8692529
2086469.5
Inventory turnover ratio=4.16times

The inventory converted into sales is 4.16 times in a year.
Inventory turnover in days

Inventory turnover in days=
no of daysa year
inventory turnover
365
4.16
Inventory turnover in days=87.74 days

The inventory is converted into sales after 87.74 days.

cost of goods sold

averageinventory
10213705
2025182.5
Inventory turnover ratio=5.04 times

The inventory converted into sales is 5.04 time in a year.
no of daysa year
inventory turnover
365
5.04

The inventory is converted into sales after 72.42 days.

cost of goods sold

averageinventory
9310049
1593600.5


no of daysa year
inventory turnover
365
5.84

The inventory is converted into sales after 62.5 day.

cost of goods sold

averageinventory
12116187
1649076


no of daysa year
inventory turnover
365
7.35
Inventory turnover in days=49.66

The inventory is converted into sales after 49.66th day.

cost of goods sold

averageinventory
13395079
1828190


no of daysa year
inventory turnover
365
7.33
Inventory turnover in days=49.80

The inventory is converted into sales after 49.80th day.
Comments
Inventory turnover
Inventory turnover is continuously increasing from 2010 to 2104. In 2010 to
2012 it is below than the average industry norm which is 6.10. But in 2013 to
2014 it shows significant increment than the industry average.
Companys conversion of inventory into sales is remarkably increasing which
shows a positive image that company management is efficient in this regard.
Although it is less than industry norms in 2010 to 2013 which is 59.81 days
or 60 days.
Receivable turnover ratio 2010

Receivable turnover ratio=
net credit sales

average receivables
10693338
1541413
Receivable turnover ratio= 6.39 times

The receivables are 6.93 times collected in a year.
Receivable turnover in days

Receivable turnover in days=
no of days a year
receivableturnover
365
6.39
Receivable turnover in days=57.12 days

The receivables are collected after every 57.12th day.

net credit sales

average receivables
12037253
1435668


no of days a year
receivableturnover
365
8.38


net credit sales

average receivables
11146698
1518332


no of days a year
receivableturnover
365
7.34


net credit sales

average receivables
14250439
1026688
Receivable turnover ratio=13.88 times


no of days a year
receivableturnover
365
13.88

The receivables are collected after every 26.21thday.

net credit sales

average receivables
15302242
985334
Receivable turnover ratio=15.53 times


no of days a year
receivableturnover
365
15.53

Comments
Receivable turnover
Overall company receivable turnover is increasing although it is sudden

decreased in 2012. It shows that company management is effective in
extending credits as well as collecting debts. It also shows that company is
effectively using its assets. Company receivable days are far less than
industry average which is 59.76 days.
Payable turnover ratio 2010

Payable turnover ratio=
net credit purchases

/CGS
average payable
8692529
945006
Payable turnover ratio=9.19 times

The payables are 9.19 times paid in a year.
Payable turnover in days

Payable turnover in days=
no of daysa year
payableturnover
365
9.19
Payable turnover in days= 39.72 days

The payables are paid after every 39.72thday.


/CGS
average payable
10213705
937474


no of daysa year
payableturnover
365
10.89

The payables are paid after every 33.52thdays.


/CGS
average payable
9310049
998291.5


no of daysa year
payableturnover
365
9.32

The payables are paid after every 39.16thday.


average payable
12116187
1205590


no of daysa year
payableturnover
365
10.05
Payable turnover in days=36.31 days

The payables are paid after every 36.31th day.


average payable
13395079
1190673


no of daysa year
payableturnover
365
11.25
Payable turnover in days=32.44

The payables are paid after every 32.44 day.
Comments
Payable turnover
Payable turnover in days of the company is relatively decreasing but it has
increased value in 2012. In all other years company is paying its debts in
lesser days than industry norm. It reflects that company is not attaining the
opportunities to invest its assets. It is not a good sign for company
management.
Fixed asset turnover 2010

Fixed assets turnover=
net
sales
assets
10693338
16973552
Fixed assets turnover= 0.63

Fixes assets are converted into sales every 0.63 times a year.
net
sales
assets
12037253
16266558


net
sales
assets
11146698
15269449


net
sales
assets
14250439
15323052


net
sales
assets
15302242
7689568
Fixed assets turnover=1.99

Fixed assets are converted into sales every 1.99 times a year.
Comments
Fixed assets turnover
The company fixed assets turnover is relatively increasing over the time
span. Which shows that company is efficiently using its fixed assets to
generate profit.
Total asset turnover 2010

Total assets turnover=
sales
total assets
10693338
17057299
Total assets turnover= 0.63 times

Total assets are converted into sales every 0.63 time in a year.

sales
total assets
12037253
16302665


sales
total assets
11146698
15197930


sales
total assets
14250439
15320597


sales
total assets
15302242
16121708

Total assets are converted into sales every 0.95 times in a year.
Comments
Total assets turnover
The company total assets turnover is relatively increasing over the time
span. Which shows that company is efficiently using its total assets to
generate sales revenue. Total assets turnover is related to sales (revenue), it
does not consider profit and loss.
Profitability Ratios
Gross profit margin 2010
Gross profit margin=
gross profit
* 100
sales
2000809
10693338 * 100
Gross profit margin= 18.71

Gross profit margin is
18.71% generating from sales.

gross profit
* 100
sales
1823548
12037253 * 100


gross profit
* 100
sales
1836649
11146698 * 100

gross profit
* 100
sales
2134252
14250439 * 100
Gross profit margin= 14.98%


gross profit
* 100
sales
1907163
15302242 * 100
Gross profit margin= 12.46%

Comments
Gross profit margin
The gross profit margin is relatively decreasing with respect to 2010. It may
indicate that company is charging low sales price and relatively higher cost
of goods. Company should lower its expenses to reduce its cost.
Operating profit margin 2010

Operating profit margin=
EBIT
sales * 100
1449216
10693338 * 100
Operating profit margin= 13.55%
Operating profit margin is 13.55% generating from sales.

EBIT
sales * 100
1726084
12037253 * 100


EBIT
sales * 100
1175029
11146698 * 100


EBIT
sales * 100
1438978
14250439 * 100


EBIT
sales * 100
1853976
15302242 * 100
Comments
Operating profit margin
The nature of operating profit margin of the company is of fluctuating.

Operating profit margin is increased from 2010 to 2011 but decreased in
2012 and 2013. In2014 it again increased which shows that company is
decreasing its expenses and eventually decreasing its cost.
Net profit margin 2010

Net profit margin =
EAT
sales * 100
Net profit margin =
277861
10693338 * 100
Net profit margin= 2.60%

Net profit margin is 2.60%generating from sales.

Net profit margin =
EAT
sales * 100
Net profit margin =
487851
12037253 * 100


Net profit margin =
EAT
sales * 100
Net profit margin =
116429
11146698 * 100


Net profit margin =
EAT
sales * 100
Net profit margin =
484532
14250439 * 100
Net profit margin = 3.40%


Net profit margin =
EAT
sales * 100
Net profit margin =
1169652
15302242 * 100
Net profit margin = 7.64%

Comments
Net profit margin
Operating profit margin is overall increasing in given time period. It has a

decreased value in 2012. The overall good position of net profit margin is
due to expenses other than the cost of goods sold are lower especially lower
interest expenses due to lower than average amount of debt.
Return on assets 2010

Return on assets=
net profit after taxes

* 100
total assets
Return on assets=
277861
17057299 * 100
Return on assets= 1.63%

The return on total assets is 1.63%.

Return on assets=

* 100
total assets
Return on assets=
487851
16302665 * 100


Return on assets=

* 100
total assets
Return on assets=
116429
15197930 * 100


Return on assets=

* 100
total assets
Return on assets=
484532
15320597 * 100

Return on assets=

* 100
total assets
Return on assets=
1169652
16121708 * 100
Return on assets=7.25%
Comments
Return on assets
Overall return on assets is increasing in time span but with a lower value in
2012. And in 2014 company shows a significant high value which shows that
management is effective in generating profit with its available assets.
Return on equity 2010

Return on equity=
EAT
stockholder equity * 100
Return on equity=
277861
8361268 * 100
Return on equity= 8.27%

The returns the company is earning for equity is 8.27%.

Return on equity=
EAT
Return on equity=
487851
4386636 * 100

Return on equity=
EAT
Return on equity=
116429
4514737 * 100


Return on equity=
EAT
Return on equity=
484532
4999269 * 100


Return on equity=
EAT
Return on equity=
1169652
6168921 * 100
Return on equity=18.96 %
Comments
Return on the equity
Overall return on equity is increasing in time span but with a highly lower
value in 2012. But after 2012 company took overall effective steps to
increase return on equity. And in 2014 company shows a significant high
value which shows that management is effective in generating profit with its
available stockholder equity.
Earnings per share 2010

Earnings per share=
earning available for common stock

no of shares of common stock
Earnings per share=
277861
145526216
Earnings per share= 1.91

Every share holder will may get till 1.91 as dividend.

Earnings per share=

Earnings per share=
487851
221964572


Earnings per share=

Earnings per share=
116429
245526216


Earning per share=
Earnings per share=

484532
245526216


Earnings per share=

Earnings per share=
1169652
245526216

Comments
Earnings per share
Overall earning per share is increasing in time span but with a highly lower
value in 2012. But after 2012 company took overall effective steps to
increase earnings per share. And in 2014 company shows a significant high
value which shows that management is effective in generating profit on
behalf on number of shares outstanding.
Leverage Ratios
Debt ratio 2010
Debt ratio=
total liablities
total assets
Debt ratio=
10022206
17057299
Debt ratio= 0.58

0.58 Of total assets are financed with total liabilities.
Debt ratio 2011

Debt ratio=
total liablities
total assets
Debt ratio=
8230532
16302665
Debt ratio= 0.50

Debt ratio 2012

Debt ratio=
total liablities
total assets
Debt ratio=
7009368
15197930
Debt ratio= 0.46

Debt ratio 2013

Debt ratio=
total liablities
total assets
Debt ratio=
6647503
15320597
Debt ratio= 0.43

Debt ratio 2014

Debt ratio=
total liablities
total assets
Debt ratio=
6278962
16121708
Debt ratio=0.39
Comments
Debt ratio
Debt ratio is decreasing in five years and it is a positive sign for the
company. It indicates that company is lowering its debts and lowering the
proportion of total assets financed by the firms creditors. The lower the
ratio, the lower the amount of other peoples money being used to generate
profits. The lower these ratio the lower the firms degree of indebtedness and
the lower financial leverage it has.
Coverage ratio 2010

Coverage ratio=
EBIT
Interest
Coverage ratio=
14499216
1072768
Coverage ratio=1.35
The interest earned 1.35 times a year.
Coverage ratio 2011

Coverage ratio=
EBIT
Interest
Coverage ratio=
1726084
1037294
Coverage ratio=1.66
Coverage ratio 2012

Coverage ratio=
EBIT
Interest
Coverage ratio=
1175029
870740
Coverage ratio=1.35
Coverage ratio 2013

Coverage ratio=
EBIT
Interest
Coverage ratio=
1438978
640543
Coverage ratio=2.25
The interest earned 2.25 times a year
Coverage ratio 2014

Coverage ratio=
EBIT
Interest
Coverage ratio=
1853976
5653384
Coverage ratio=3.28
The interest earned 3.28 times a year
Comments
Coverage ratio
Coverage ratio is overall increasing but has a low value in 2012. The
increasing coverage ratio indicates that the company has lowered degree of
financial leverage and its earnings are not volatile. Company has more ability
to make contractual interest payments. The increasing value is indicating
that company is more able to fulfill its interest obligations.
Conclusion
The current status of the company has been analyzed by the financial
analysis of the company from 2010_2014 by the Common size Analysis,
Trend Analysis and Ratio Analysis. The common size analysis of balance
sheet shows that over the period of five years there is a slight decrease in
company's current assets while an increase in fixed assets and there is a
decrease in the company's current and long term liabilities while a increase
in company's equity. It means that the company has invested more in the
plant, equipment and building in the course of three years therefore; it has
decreased current and long term liabilities which are used to finance the
fixed asset. The common size analysis of income statement shows that from
2010 to 2013 there is an increase in COGS and thus a decrease in gross
profit. It means that the unit cost of the product of the company has risen
over the years. Selling, marketing & distribution expense show an increase
over the period, administration expense and other operating expense
decrease, other operating incomes and operating profit also show a slight
decreases over time. Financial charges increase, profit before tax show a
increase, taxation also increased and profit after tax of the company
significantly increased from 2010 to 2014.The trend analysis of balance
sheet shows that the decrease of 8.43% in current assets from 2012 to 2013
is less than the increase of 23.50% from 2013 to 2014.And the increase of
23.40% in equity from 2013 to 2014 is more than the increase of 10.73% in
equity from 2012 to 2013.The Trend analysis of income statement shows that
the net sales has increased more from 2013 to 2014 than from 2011 to
2012.Moreover the COGS was also considerably decrease from 2013 to 2014
than from 2012 to 2013.So overall the Gross profit of the company has
decrease by 10.64 from 2013 to 2014 while 16.20 from 2012 to 2013.
The ratio analysis has explained the company financial state as satisfying. In
the liquidity ratios, the net working capital has increased from 2010 to 2014
because the company has increased its fixed assets in comparatively more
amount than its current liabilities. The liquidity of the firm according to
Current Ratio although has decreased over the five years but it is still close
to the standard requirement of 2:1.But according to the acid-test ratio, the
company is facing the problem of liquidity because the ratio is less than the
standard ratio.
In the ACTIVITY RATIOS, the Inventory turnover ratio shows that the company
should focus on increasing its sales because the company has been unable
to boost its sales over the previous years. The Gross Profit of ktml in year
2013 was 14.98% which diminished in 2014 to 12.46%. Operating Profits of
the company were 22.46% in 2013 which increased to 28.84% in 2014.
Operating profit margin has increased because companys operating
expenses are low. Reductions in Net profit can also be seen if compared to
last two years which means companys costs have increased. Return on
Assets showed an increment in 2014. The company is also earning significant
high amount for its shareholders in comparison to the previous years.
Moreover, there is a movement of equity to liability due to the decrease in
the debt ratio of the company. In 2014, the operating income of the company
is as large as 7.84 times of its expense which is very high than its previous
years. So we can say that although in first four years company net income is
satisfactory but it boomed in 2014. So company is in very good condition in
2014. And it has not any need to take any sudden steps to change its
position.
References
http://www.kmlg.com/kmlg/index.php
http://www.kmlg.com/kmlg/f_reports.php
http://www.kmlg.com/kmlg/financialreport.php?fid=4
http://www.kmlg.com/kmlg/docs/ktml/KTML_Financial_Highlights_20092014.pdf

Financial Report KTML

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FINANCIAL REPORTING AND

PROF. WASEEM UL REHMAN

MUHAMMAD ARSAL IQBAL 44-A

BBA (5th Semester)

INSTITUTE OF BUSINESS ADMINISTRATION

MLCF is subsidiary company of

Statement of Financial Position

EQUITY AND LIABILITIES

Share capital and reserves

Issued, subscribed and paid up share

CONTINGENCIES AND COMMITMENTS

Non-current assets classified as held for

Statement of Comprehensive Income

PROFIT AFTER TAXATION

OTHER OPERATING INCOME

PROFIT FROM OPERATIONS

PROFIT BEFORE TAXATION

EARNINGS PER SHARE - BASIC

Horizontal Analysis of Financial Statement

Profit from operations

Profit/(Loss) before taxation

Profit / (Loss) after taxation

Total equity and liabilities

Profit and Loss Account

Vertical Analysis of Financial Statement

Profit and Loss Account

Selling and distribution expenses

Interpretations of Vertical Analysis

From 2011 to 2012

From 2012 to 2013

From 2013 to 2014

Net Working Capital 2011

Net Working Capital 2012

Net Working Capital 2013

Net Working Capital 2014

Current Ratio 2010

Current Ratio 2011

Current ratio 2012

Current ratio= 0.63

Current ratio 2013

Current ratio= 0.69

Current ratio 2014

Current ratio= 0.91

Quick ratio 2010

Quick ratio 2011

Quick ratio 2012

Quick ratio 2013

Quick ratio 2014

cost of goods sold

Inventory turnover ratio=

Inventory turnover ratio=4.16times

Inventory turnover in days

Inventory turnover in days=

Inventory turnover in days=87.74 days

Inventory turnover ratio 2011

cost of goods sold

Inventory turnover ratio=

Inventory turnover ratio=5.04 times

Inventory turnover in days

Inventory turnover in days=

Inventory turnover in days=

Inventory turnover in days=72.42 days