Market Research Essay, Research Paper
Separate A 1. Directors AJ lane, WJ Locke, JF Kelly, JR Cadwaallader, DG Lane, HA Lynch, IA Pollard, RC Milne 2. Entire Gross saless = $ 475,264,000 ( 1997 ) ( Before Abnormal points ) 3. Gross saless gross for the amalgamate entity, for the twelvemonth ended 30 June 1996, was $ 449745000. 4. Equity method used when company has significance influence but non command of investee company OPSM usage consolidation method which means it has control over other investee. 5. Entire involvement disbursals for the amalgamate entity for the twelvemonth was $ 3819000. The entire involvement paid in hard currency by the amalgamate entity during the twelvemonth was $ 4113000. During the twelvemonth ended 30 June 1997, The company besides paid off some involvement collectible incurred in old twelvemonth. This is why the figure for the involvement disbursals in the twelvemonth is different from the figure for the involvement paid in hard currency in the twelvemonth. 6. Contigent liabilities are liabilities, which are contigent on peculiar event happening that has non yet happened. They do non run into the standards for the acknowledgment of liabilities so they are non on the balance sheet, nevertheless they are disclosed on the notes. 7. The entire gross revenues gross of the Protectors Safety Supply group for the twelvemonth ended 30 June 1997 was $ 158900000. 8. Cash points in balance sheet merely include CAB plus on manus plus bank sedimentations, whereas, for the CFS, hard currency includes CAB plus on manus plus bank sedimentations, cyberspace of bank overdrafts.i.e. from balance sheet. CAB plus on manus 6454 Bank deposits 13701 20155 Less: bank overdrafts 1053 Balance of statement of hard currency flows 19102 9. Net income after revenue enhancement ( after unnatural points ) for 1994 is $ 21434000. 10. The amalgamate entity received $ 1106000 how the sale of non-current assets during the twelvemonth. 11. The figure of members keeping ordinary portions in the company was 13298. 12. Because they use cost method. 13 Number of ordinary portions = 143373876. 14 Work wear and safety system 15 Price H2O house plus the spouse R.Ward. 16 The amalgamate operating net income before income revenue enhancement for the twelvemonth ended 30 June 1996 and 30 June 1997 is 34629000 and 43526000. Part B Executive Summary OPSM Protector Limited is a amalgamate entity dwelling of three runing groups, OPSM, Protector Safety Supply and Protector Technologies. The intent of this study is to supply an rating of the tendency in public presentation of OPSM Protectors Limited as a amalgamate entity in 1996 to 1997, though the analysis of the company & # 8217 ; s 1997 Annual Report, particularly its fiscal statements. Fiscal ratios have been employed in this study as the prevailing step of the company & # 8217 ; s public presentation, and each will be discussed in bend. A tabular array of fiscal ratios with its computations and definitions can be found in the appendix to this study. Restrictions to this analysis will besides be discussed. The basic determination refering OPSM public presentation from 1996 are as follows: + With respect to fiscal stableness, hazard in this country is rather low as OPSM is non to a great extent in debt funding and can cover its involvement payment really well.+ The company is moderately liquid, apparent by the current ratio 1.74.+ Record net income after revenue enhancement and abnormals up 30 % to % 28.8 million.+ Record gross revenues gross up 6 % to $ 475.3 million.+ Dividend up 11 % to 15 cents per portion to the full franked.+ Cash flow up 150 % to $ 41.8 million.+ Debt to equity ratio down from 20 % to 9.6 % .+ Change procedure continued, with increased productiveness and client focus.+ Business of Dunlop Industrial Footwear acquired. Liquidity The current ratio is a stock step of whether the company has adequate short term assets to cover its short term debts and therefore stay solvent. As a regulation of pollex that the current ratio should be at least be 1.5:1. OPSM operator current ratio does non look excessively bad. In 1996 it was 1.70 and in 1997 it was 1.70 and in 1997 it was 1.74. This indicates that throughout the period, current assets were sufficient to cover current liabilities. Financial Stability The tendency of the equity ratio shows that the per centum of plus provided by stockholders is tending ( addition by 2.5 % ) . However the company is somewhat in equity relation to its debit. The ratio of 0.82 indicates the company rely on equity were so on debit and that its comparative rely on equity instead than debit is somewhat diminishing during 1997 ( debit is increased by 10.1 % and equity increased by 7.6 % ) . Increase in trust on debit to finance plus was shown in debit to equity ratio which is somewhat increased from 44.5 % to 45.1 % . This is consequence of a smaller addition in entire plus relation to its liability. Since there is an addition in receivable, it is offset by a lessening in hard currency ( see common size balance sheet ) . Cash Flow There is great addition in net hard currency flows from runing activities by $ 30866000, this is because of the great lessening in income revenue enhancements. However, the company & # 8217 ; s net hard currency flows from puting activities lessenings by $ 1157000, because the company purchased concerns and they spent $ 10755000 for that. Similarly, the company & # 8217 ; s net hard currency flows from funding activities decreases by $ 16601000. The ground is the lessening in refund of borrowing. Therefore, due
to the great addition in net hard currency flows from operating activities, eventhough the sum of net hard currency flows from puting activities and funding activities lessening, the hard currency at the terminal of the twelvemonth increased by $ 7220000. Restrictions A major restriction which arises from this analysis is that the figures for the two old ages given in the statements does non let us to compare it with old years’ figures and in bend bounds us from pulling a meaningful tendency. We are merely able to compare alterations between the two old ages ( 1996 & 1997 ) and supply grounds behind those alterations: nevertheless we can non look accurately into the hereafter depending on merely the one one-year study. We need to cognize the Director’s plans for the company in the hereafter, its current fortunes. We can non compare OPSM’s public presentation with that of others in the same sector, as there is no qualitative information. This limits a meaningful reading of the ratios to let or to supply a frame of mention. We can non find whether the company’s public presentation and place is above, below or on mean compared to other companies with the information provided.
Another restriction of the analysis is that we can non find precisely how much of the company & # 8217 ; s public presentation is truly due to direction and how much of it depends on other factors, such as economic tendencies, merchandise alterations, brotherhood force per unit area, and even pure fortune. In other words, we can non mensurate the quality of the director & # 8217 ; s public presentation nor measure the director & # 8217 ; s attempts. Decision This fiscal analysis of OPSM Protector Limited has proven overall, the company & # 8217 ; s public presentation has increased and the company is really stable with respects to put on the line. It has increasing tendencies in about all facets. There has been an addition in puting activities in a bead in the degree of hard currency in the company. The dividend payout has increased over there portion old ages. The being of a good current ratio indicates that bend out the period, current assets were sufficient to cover current liabilities and there were no jobs in paying debt as they fall due. Judging on past records, it seems OPSM Protector Limited is a financially stable endeavor. Appendix OPSM Common Size Balance Sheets 1997 1996Current Assets Cash 7.57 5.54 R/C 20.51 19.80 Investing 28.06 28.30 Others 1.45 1.1357.58 54.17 Non-current Asset R/C 0.09 0.11 Investing 0.76 0.82 Property, works and equipment 25.78 26.87 Intangibles 12.18 12.48 Others 3.61 4.95 Entire non-current plus 47.42 45.23 Entire assets 100.00 100.00 Current Liabilities A/P 17.51 16.26 Borrowings 2.70 5.99 Commissariats 12.90 9.92 Entire current liabilities 33.11 32.17 Non-current liabilities Borrowings 10.25 10.75 Commissariats 1.73 1.59 Entire non-current liabilities 11.98 12.34 Entire liabilities 45.09 44.51 Stockholders equity Share capital 26.91 29.15 Militias 13.96 14.04 Retained net incomes 14.04 12.30 Entire SE 54.91 55.49 OPSM Common Size Profit and Loss Account Operating net income before unnatural points and income revenue enhancement 100 100Abnormal points before income revenue enhancement & # 8211 ; ( 13.08 ) & # 8212 ; & # 8212 ; & # 8212 ; & # 8212 ; & # 8211 ; Operating net income before income revenue enhancement 100 86.92Income revenue enhancement attributable to operating net income ( 33.80 ) ( 31.36 ) & # 8212 ; & # 8212 ; – & # 8212 ; & # 8212 ; & # 8211 ; Operating net income after income revenue enhancement 66.20 55.56 Ratios Return on assets ( ROA ) = EBIT/Total Asset 1997 1996 = ( 43526+3819 ) /266411 = ( 39839+3709 ) /2445094 = 17.77 % =17.76 % Return on equity ( ROE ) = OPAT/Total Equity = 28815/146294 = 22134/135998 = 19.70 % = 16.28 % Asset turnover =Sales/Total Asset =475264/266411 =449745/245094 =1.78 =1.83 Profit border = EBIT/Sales =47345/475264 =43548/449745 =9.96 % =9.68 % Return on Shareholders & # 8217 ; equity = Net Profit/ Equity = 43526/146294 =39839/135998 = 29.75 % =29.29 % Debtor & # 8217 ; s turnover = Gross saless ( recognition ) /Account Receivable =475264/ ( 231+54627 ) =449745/ ( 48531+266 ) =866.35 % =921.67 % Leverage = Total Asset/ Shareholders & # 8217 ; Equity =266411/146294 =245094/135998 =182.11 % =180.22 % Debt/Equity = Total liabilities/ Total Shareholders & # 8217 ; equity =120117/146294 =109096/135998 =82.11 % =80.22 % Interest Coverage = EBIT/ involvement =47345/3819 =43548/3709 =1239.72 % =1174.12 % Dividend payout = Dividend declared per share/ EPS = 15/20.1 = 13.5/18.1 = 74.63 = 74.59 Assignment OPSM Protector Limited YOO-MIN KANG ( 2226558 ) Coach: Linda Chan Tutorial: Friday 9-11 Performance The return on equity indicates the efficiency with which a company employs its equity capital and it & # 8217 ; s therefore straight linked to gaining per portion. ROE for OPSM Limited increased from 16.28 % in 1996 to 19.70 % in 1997, as operating net income, after revenue enhancement ( OPAT ) increased by 30.18 % and equity increased by 7.56 % . The addition in operating net income before revenue enhancement of $ 43526000 ( an betterment of 25.69 % ) from the old twelvemonth resulted as there is no unnatural charge in 1997. Return on Asset corsets constant ( 17.8 % for both 1996 & A ; 1997 ) . This is resulted by the alteration in EBIT and alteration in entire plus ( alteration in EBIT = 8.7 % , alteration in entire plus = 8.7 % ) . There is an addition in net income border due to increase in OPAT and Dividend payout ratio stays about changeless ( 1996:74.59 % and 1997: 74.63 ) . The Entire Asset Turnover ratio decreased ( 1996:1.83 to 1997: 1.78 ) during 1997 which was most likely the consequence of the increasing entire assets.