No. Ratios 2016 2015 Diff.

TESTS OF FINANCIAL CONDITION

20 Financial Leverage Ratio (x) 1,91 1,96 -0,05

Financial leverage ratios, sometimes called equity or debt ratios, measure the value
of equity in a company by analyzing its overall debt picture. These ratios either
compare debt or equity to assets as well as shares outstanding to measure the true
value of the equity in a business. In other words, the financial leverage ratios
measure the overall debt load of a company and compare it with the assets or
equity. This shows how much of the company assets belong to the shareholders
rather than creditors. When shareholders own a majority of the assets, the company
is said to be less leveraged. When creditors own a majority of the assets, the
company is considered highly leveraged. All of these measurements are important
for investors to understand how risky the capital structure of a company and if it is
worth investing in. This indicates that the company is still considered risky for the
investor because the company is using debt and other liabilities to finance its assets.
So, the company should work better for upcoming years to lower the leverage, until
the ratio is between 1-2 which means the low risk for the company. It means that
additional equity was converted proportionally into Indofood assets.
21 DER (%) 90,79 95,85 -5,06
The debt to equity ratio (DER) is a financial, liquidity ratio that compares a
company's total debt to total equity. The debt to equity ratio shows the percentage of
company financing that comes from creditors and investors. A higher debt to equity
ratio indicates that more creditor financing (bank loans) is used than investor
financing (shareholders). Lower the ratio means less risk on its financial or funding
the Samudera Indonesia business compare to year 2015. The table above showed
that the DER of Samudera Indonesia decreasing from previous year. This could be
considered good performance for Samudera Indonesia, because a lower debt to
equity ratio usually implies a more financially stable business. Companies with a
higher debt to equity ratio are considered more risky to creditors and investors than
companies with a lower ratio. Creditors view a higher debt to equity ratio as risky
because it shows that the investors have not funded the operations as much as
creditors have. In other words, investors do not have as much skin in the game as
the creditors do. This could mean that investors do not want to fund the business
operations because the company is not performing well. Lack of performance might
also be the reason why the company is seeking out extra debt financing. So, for next
years, Samudera Indonesia should maintain and improve their good performance in
order to prevent the need of funding from creditors and gain the trust from the
regular and new investors to fund the operations.
 No. Ratios 2016 2015 Diff.

22 DCR (%) 66,60 67,24 -0,64

The debt-to-capital ratio is a measurement of a company's financial everage,
calculated as the company's debt divided by its total capital. The debt-to-capital ratio
of Samudera Indonesia is decreasing from the previous year, which decreases from
67,24 in 2015 to 66,60 in 2016. This indicates that the company is tend to use equity
financing rather than debt financing, because the higher the debt-to-capital ratio, the
more debt the company has compared to its equity. A company with high debt-to-
capital ratios, compared to a general or industry average, may show weak financial
strength because the cost of these debts may weigh on the company and increase
its default risk. We can also conclude from those 3 ratios (DER, DCR and FLR) that
Samudera Indonesia is more solvent in 2016 than 2015.
23 Times Interest Earned (x) 11,65 16,09 -4,44
Times interest earned ratio is a coverage ratio that measures the proportionate
amount of income that can be used to cover interest expenses in the future. In year
2016 means that one of interest guaranteed by 11,65 of profits. This amount is lower
than previous year which is 16,09 . Eventhough there is a decreasing in 2016,
company still have capability to cover its interest.
24 Cash Flow / Debt (%) 16,86 14,80 2,06
The cash flow-to-debt ratio is a ratio of a company‖s cash flow from operations to its
total debt. The cash flow-to-debt ratio is a type of debt coverage ratio, and is an
estimate of the amount of time it would take a company to repay its debt if it devoted
all of its cash flow to debt repayment. Cash flow is used to evaluate a company's
funds rather than earnings because it provides a better insight into a company's
ability to pay its obligations. With a significant reduction of the ratio of cash flow-to-
debt Samudera Indonesia from 14,80 percent in 2015 to 16,86 percent in 2016, it is
considered good for the company because the higher the percentage ratios, its
better the company's ability to bring its total debt. This shows that Samudera
Indonesia was a good performance in 2016.