4.
Profitability Ratios 2013 2014 Interpretation
Return on Equity
(ROE)
009,575,297
(133,326,264+124,058,087)÷2 × 1
=7.4%
0028,262,534
(158,134,503 + 133,326,264)÷2 × 1
= 19.4%
During the period of
2013 to 2014, the
return on equity
increase from 7.4%
to 19.4%. The owner
is getting more return
from the business.
Net Profit Margin
(NPM)
009,575,297
154,830,563 × 1
=6.2%
0028,262,534
178,063,772 × 1
=15.9%
Over the period of
2013 to 2014, net
profit margin rise
from 6.2% to 15.9%.
The business ability
to control its
expenses is better
than last year.
Gross Profit Margin
(GPM)
0017,501,191
154,830,563 × 1
=11.3%
0038,542,547
178,063,772 × 1
=21.6%
During the period of
2013 to 2014, the
gross profit margin
has increase from
11.3% to 21.6%. The
business ability to
control its cost of
good sold expenses
is better than last
year.
Selling Exp. Ratio
(SER)
00(6,274,482)
154,830,563 × 1
=4.05%
00(6,189,479)
178,063,772 × 1
=3.5%
During the period of
2013 to 2014, the
selling expenses ratio
is increased from
4.05% to 3.5%. The
business ability to
control its selling is
worse than last year.
General Exp Ratio
(GER)
00(56,316)
154,830,563 × 1
=0.04%
00(676,519)
178,063,772 × 1
=0.4%
Over the period of
2013 to 2014, the
general expenses
ratio rise from 0.04%
to 0.4%. The
business ability to
control the general
expenses is worse
than last year.
Financial Exp. Ratio
(FER)
00(1,241,970)
154,830,563 × 1
=0.8%
00(1,194,060)
178,063,772 × 1
=0.67%
During the period of
2013 to 2014, the
financial expenses
ratio is rise from
0.8% to 0.67%. The
business ability to
control its financial
expenses is worse
than last year.
5.
Stability Ratios 2013 2014 Interpretation
Working Capital
24,638,111
59,089,052
=2.4 : 1
35,482,099
64,069,372
=1.8 : 1
Over the period, the
business working capital
has decreased from
2.4:1 to 1.8:1. The
business ability to pay
current liabilities is worse.
In addition, it exceed the
minimum 2:1 ratio.
Total Debt 0043,379,534
176,705,798 × 1
=24.6%
00 47,215,434
205,349,937 × 1
= 23%
Over the period,the total
debt has decreased from
24.6% to 23%. The
business total debt has
decreased. However, it
satisfied the maximum
50% limit..
Stock Turnover 653 ÷ 137,329,372
(12,753,072+11,603,549)÷2
=32.4 days
365 ÷ 139,521,315
(17,500,317 + 12,753,072)÷2
= 39.6 days
During the period of 2013
to 2014, the stock
turnover has increased
from 32.4 days to 39.6
days. This proof that the
business ability to sell its
goods slower than last
year.
Debtor Turnover 653 ÷ 77,415,282
(12,002,645+10,947,818)÷2
=54.1 days
653 ÷ 89,031,886
(11,600,253+12,002,645)÷2
=48.4 days
During the period of 2013
to 2014, the debtor
turnover has decreased
from 54.1 days to 48.4
days . The business is
taking less time to collect
its debts.
Interest Coverage
1,241,970
1,241,970+9,575,297
=8.7 times
1,191,060
1,191,060+28,262,534
=24.7 times
During the period of 2013
to 2014, the interest
coverage has increased
from 8.7 times to 24.7
times. The ability for the
business to pay its
interest coverage is
better. However, the
business should never fell
below 5 times.