1. A Comparison of Ratios Of Ferozsons Lab. Ltd and Searle Pakistan Ltd . Group members Farheen Khalid Nissa Razzak Sobia Yousuf Lubna Mahar

2. INTRODUCTION TO FEROZSONS

3. COMPANY PROFILE Exchanges: Karachi, Lahore & Islamabad Symbol: Feroz Country: Pakistan City: Rawalpindi Industry: The company is primarily engaged in the manufacturing and sale of pharmaceuticals and soap products Number of Employees: 461 Year Ended: 30th June

4. INTRODUCTION TO SEARLE

5. COMPANY PROFILE Exchanges: Karachi & Islamabad Symbol: Searl Country: Pakistan City: Karachi Industry: The company is principally engaged in the manufacture of pharmaceutical products and a low calories sweetener Number of Employees: 528 Year Ended: 30th June

6. FINANCIAL RATIOS 2004 & 2005

7. LIQUIDITY RATIOS

8. CURRENT RATIO Current Ratio= Current Assets Current Liabilities 1.22 2.82 2005 1.11 2.01 2004 Searle Ferozsons Year

9. QUICK RATIO (ACID-TEST RATIO) Quick Ratio= Current Asset-Inventory Current Liabilities 0.96 1.01 2005 0.97 1.89 2004 Searle Ferozsons Year

10. LEVERAGE RATIOS

11. DEBT TO EQUITY RATIO Debt-to-Equity= Total Debt Shareholder Equity 2 0.36 2005 3 0.46 2004 Searle Ferozsons Year

12. DEBT TO TOTAL ASSETS Total Debt Ratio= Total Debt Total Assets 0.56 0.24 2005 0.52 0.27 2004 Searle Ferozsons Year

13. EQUITY MULTIPLIER Equity Multiplier= Total Assets Shareholders’ equity 3.55 1.5 2005 4.55 1.71 2004 Searle Ferozsons Year

14. COVERAGE RATIO

15. TIMES INTEREST EARNED Times Interest Earned= EBIT Interest Charges 4.5 118 2005 3.9 104.5 2004 Searle Ferozsons Year

16. EFFICIENCY RATIOS

17. RECEIVABLE TURNOVER Receivable Turnover= Annual Net Credit Sales Receivables 3.07 87 2005 2.8 64.5 2004 Searle Ferozsons Year

18. RECEIVABLE TUROVER IN DAYS Average collection period= Days in a year Receivable Turnover 117 4 2005 129 6 2004 Searle Ferozsons Year

19. INVENTORY TURNOVER Inventory Turnover = Cost Of Goods Sold Inventory 6.4 3.6 2005 5.45 3.5 2004 Searle Ferozsons Year

20. INVENTORY TURNOVER IN DAYS Inventory Turnover in Days= Days in a year Inventory turnover 56 101 2005 66 103 2004 Searle Ferozsons Year

21. TOTAL ASSET TURNOVER Total Asset Turnover= Net sales Total assets 1.04 1.27 2005 0.93 1.53 2004 Searle Ferozsons Year

22. PROFITABILITY RATIOS

23. GROSS PROFIT MARGIN Gross Profit Margin= Gross Profit Net Sales 32.5% 53% 2005 37% 50% 2004 Searle Ferozsons Year

24. NET PROFIT MARGIN Net Profit Margin= Net profit after taxes Net sales 3.50% 21% 2005 6% 16% 2004 Searle Ferozsons Year

25. RETURN ON ASSETS Return on Assets= Net profit after taxes Total assets 3.70% 27% 2005 5% 24% 2004 Searle Ferozsons Year

26. RETURN ON ASSETS DUPONT APPROACH Return on Assets= Net profit margin*Total Asset Turnover 0.036 0.26 2005 0.055 0.24 2004 Searle Ferozsons Year

27. RETURN ON EQUITY Return on Equity= Net profit after taxes Shareholder’s equity 13.10% 41% 2005 24% 42% 2004 Searle Ferozsons Year

28. RETURN ON EQUITY DUPONT APPROACH Return on Equity = Net profit margin*Total Asset Turnover*Equity Multiplier 0.13 0.40 2005 0.25 0.41 2004 Searle Ferozsons Year

29. MARKET VALUE MEASURES

30. EARNINGS PER SHARE EARNING PER SHARE= EAT No. Of Shares 3.6 19.87 2005 5.06 13.06 2004 Searle Ferozsons Year

31. PRICE TO EARNINGS SHARE Price to Earnings Ratio= Price Earnings 11.56 9.30 2005 6.92 9.47 2004 Searle Ferozsons Year

32. Common Size & Indexed Size Balance Sheet & Income Statement

33. FEROZSONS’ COMMON & INDEXED SIZE BALANCE SHEET (ASSET SIDE) 72.16 100.00 100.00 100.00 575305163 415130035 TOTAL 60.19 100.00 53.19 44.37 306002950 184183116 TOTAL CURRENT ASSETS 56.74 100.00 14.44 11.35 83045347 47119395 Cash and bank balances 43.39 100.00 9.92 5.97 57071000 24763787 short term investments 54.83 100.00 1.08 0.82 6206514 3403035 Trade deposits 117.42 100.00 1.46 2.38 8415508 9881645 Trade debts (RECEIVABLES) 90.49 100.00 17.48 21.92 100545997 90984280 Stocks-in-trade 116.6 100.00 46.81 55.63 269302213 230946919 TOTAL FIXED ASSETS 100.58 100.00 0.09 0.13 538147 541247 LONG TERM DEPOSITS 100.00 100.00 0.01 0.01 33085 33085 LONG TERM INVESTMENTS 85.73 100.00 46.71 55.49 268730981 230372587 Property, plant & equipment Fixed Assets Tangible Indexed size % Common size % Regular Years 2005 2004 2005 2004 2005 2004

34. FEROZSONS’ COMMON & INDEXED SIZE BALANCE SHEET (LIABILITY SIDE) 138.58 100.00 100.00 100.00 575305163 415130035 TOTAL LIABILITY AND EQUITY 123.26 100.00 23.80 26.76 136906815 111075514 Total liabilities 118.58 100.00 18.86 22.05 108520915 91519724 Total Current Liabilities 139.96 100.00 12.50 12.38 71912416 51381311 Trade and other payables Current Liabilities 145.15 100.00 4.93 4.71 28385900 19555790 Total Non Current Liabilities 158.15 100.00 66.66 58.41 383470795 242479041 Total Equity Indexed Size% Common Size% Regular Years 2005 2004 2005 2004 2005 2004

35. FEROZSONS’COMMON & INDEXED SIZE INCOME SHEET 152.11 100.00 21.03 15.84 153565799 100955403 Net profit 152.31 100.00 21.05 15.83 153664442 100891537 Profit after taxes 131.50 100.00 8.71 7.59 63607622 48371149 Profit for taxation 145.56 100.00 29.76 23.41 217272064 149262686 Earning after interest 128.62 100.00 0.25 0.23 1854323 1441689 Finance Cost 145.40 100.00 30.01 23.64 219126387 150704375 EBIT 461.44 100.00 3.55 0.88 25929235 5619173 Other income 136.65 100.00 28.96 24.27 211392190 154698493 Operating profit 107.61 100.00 24.22 25.78 176837384 164335764 total expenses 104.28 100.00 19.54 21.46 142663053 136807554 selling & distribution costs 124.14 100.00 4.68 4.32 34174331 27528210 Administrative Expenses 121.69 100.00 53.18 50.05 388229574 319034257 Gross profit 107.35 100.00 46.82 49.95 341837087 318441195 Cost of goods sold 114.52 100.00 100.00 100.00 730066661 637475452 Net sales 2005 2004 2005 2004 2005 2004 Indexed Size% Common Size% Regular Year

38. QUESTIONS TIME