LBS Bina Group is a Malaysian property developer founded in the 1960s. The document analyzes the company's financial ratios from 2012-2013. It finds that profitability ratios like return on equity and net profit margin improved significantly from 2012 to 2013, indicating higher profits. Liquidity ratios like current ratio declined slightly, suggesting liquidity became slightly worse. Debt levels and interest coverage improved, showing the company's financial position strengthened over this period.

1. 1
SCHOOL OF ARCHITECTURE, BUILDING AND DESIGN
FOUNDATION IN NATURAL BUILD ENVIRONMENT
BASIC ACCOUNTING (ACC30205)
FINANCIAL RATIO ANALYSIS
COMPANY: LBS BINA GROUP BERHAD
LECTURER: MS. TAY SHIR MEN
SUBMISSION DATE: 4TH FEBRUARY 2016
LEONG LI JING 0323628
THAM KAI LOON 0323593
GILLIAN CHONG 0323941
NOOR DINNA HANI MURAD 0323430

2. 2
Table of Content
Content Page
Background History 3
Recent Development 4
Profitability Ratio 7
Stability Ratio & Liquidity Ratio 8
Price Earnings Ratio 9
Share Price 10
Investment Recommendation 12
Appendix 13
References 25

3. 3
Background History
LBS Bina Group is a company who build homes and building which meet the needs of Malaysian
from 20 years ago. However, the official LBS date of incorporation is on June 29th on year 2000.
LBS has carefully nurtured a reputation for delivering properties with unsurpassed quality that
inspire and enrich. By insisting on continually improving not only construction technologies but
the very latest in architectural trends, LBS lives up to its belief that Malaysians deserve homes of
the finest workmanship.
Move on, LBS began with one man’s vision. In the 1960s, Dato Seri Lim Bock Seng founded a
construction business in Petaling Jaya. Within a few years, LBS’ scale of projects established it as
a reputable property developer. Several of its well-publicised accomplishments were Taman
Perindustrian Bukit Serdang Seksyen 14 in Selangor, jointly developed with the 1992 Thomas Cup
champions, Taman Pinggiran Putra, Serdang and the township project at Bandar Saujana Putra.
On January 30th year 2002, LBS Bina Group had their company listed on Bursa Malaysia.
This trend of growth has seen LBS become a dominant player in Malaysia’s property sector, and
spread its wings across the seas to China.
Below are some of LBS Bina Group Information;
Company Name : LBS Bina Group Berhad (518482-H)
Listed on Bursa Malaysia : 30 January 2002 Main Market (Properties)
Stock Code/Name : 5789 / LBS
Bloomberg Code : LBSMK
Registered Office :
Plaza Seri Setia Level 1–4
No. 1 Jalan SS9/2
47300 Petaling Jaya
Selangor Darul Ehsan
Malaysia
Tel +60 3 7877 7333
Fax +60 3 7877 7111
Registrar :
Tricor InvestorServices Sdn Bhd (118401-V)
Level 17 The Gardens North Tower
Mid Valley City
Lingkaran Syed Putra
59200 Kuala Lumpur
Tel +60 3 2264 3883
Fax +60 3 2282 1886
Auditor :
Messrs UHY (AF 1411)
11.05 Level 11 The Gardens South Tower
Mid Valley City
Lingkaran Syed Putra
59200 Kuala Lumpur
Tel +60 3 2279 3088
Fax +60 3 2279 3099

4. 4
Recent Development
Recently, LBS Company is planning on to join venture with Chief Minister of Malacca to establish
a cultural museum in Zhuhai, China.
Lamdeal Investments Limited (Lamdeal) which is a wholly-owned subsidiary of property
developer LBS Bina Group Berhad (LBS) signed a Memorandum of Understanding (MOU) with
the Chief Minister of Malacca (Incorporation) (CMI) and witnessed by the Malacca governor Tun
Mohd Khalil Yaakob, Chief Minister Datuk Seri Idris Haron and governor of Guangdong province
Zhu Xiaodan on April 30th 2015 to establish a cultural museum, one-stop centre and Made-In-
Malaysia Excellence exhibition hall within Zhuhai International Circuit (ZIC) to show case the
heritage and customary cultural of Melaka.
During the day of signing the Memorandum of Understanding for this project, LBS Managing
Director, Dato’ Sri Lim Hock San said, “With this MOU, both parties are allowed to share and
facilitate the flow of information on setting up this cultural centre through the CMI’s “One Stop
Centre”. We are happy with our experience in Zhuhai, China, we are able to play the bridging role
to build a stronger ties between the countries.”
ZIC’s Transformation Plan encompasses the following major principles:
● Zhuhai National High-Tech Zone to become a regional comprehensive service centre;
● To introduce and integrate motorsports into the modern urban life in an open way;
● To create a regional Tourism Centre with a special attraction in the Northern District of Zhuhai;
● To establish a multi-cultural centre to encourage cultural exchanges with a Malacca cultural
museum and a MIME exhibition hall.
LBS Bina, in this strategic collaboration with China and it aims to promote Malaysia and
Malaysian tourism as well as culture in both countries to further drive economic and business
growth in the future.
The Maritime Silk Road is an initiative aimed at investing and fostering new relationship and to
bolster existing partnerships in South-East Asia, Oceania, and North Africa.
For now, the project is still on progress.

5. 5
Below are some news regarding LBS Bina Group recent development:
From New The Star Online, 9th July 2015, Thursday.

6. 6
From The Sun Daily: 6th April 2015.

7. 7
Profitability Ratio
The following table shows the profitability ratio calculation and interpretation for LBS Bina
Group Sdn Bhd in the year 2012 and 2013.
Profitability
Ratios
2012 2013 Interpretation
Return On Equity
(ROE)
𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑂/𝐸
× 100%
=
39,003,430
(526,831,483 + 506,549,830) ÷ 2
× 100%
=
39,003,430
516,690,656.5
× 100%
= 7.55%
=
397,323,654
(872,640,233 + 526,831,483) ÷ 2
× 100%
=
397,323,654
699,735,858
× 100%
= 56.78%
The ROE in 2013
(56.78) is higher than
the ROE in 2012 (7.55).
It means the owner is
earning a higher return
on the capital in 2013.
Net Profit Margin
Ratio (NPM)
𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡
𝑁𝑒𝑡 𝑆𝑎𝑙𝑒𝑠
× 100%
=
39,003,430
509,644,355
× 100%
= 7.65%
=
397,323,654
533,532,722
× 100%
= 74.47%
The NPM in 2013
(74.47) is higher than
the NPM in 2012
(7.65). It means the
owner is earning a high
net profit in 2013.
Gross Profit Margin
Ratio (GPM)
𝐺𝑟𝑜𝑠𝑠 𝑃𝑟𝑜𝑓𝑖𝑡
𝑁𝑒𝑡 𝑆𝑎𝑙𝑒𝑠
× 100%
=
146,227,906
509,644,355
× 100%
= 28.69%
=
168,577,154
533,532,722
× 100%
= 31.60%
The GPM in 2013
(31.60) is higher than
the GPM in 2012
(28.69). It means the
GOGS expense is low
and well managed 2013.
General Expenses
Ratio (GER)
𝑇𝑜𝑡𝑎𝑙 𝐺𝑒𝑛𝑒𝑟𝑎𝑙 𝐸𝑥𝑝𝑒𝑛𝑠𝑒𝑠
𝑁𝑒𝑡 𝑆𝑎𝑙𝑒𝑠
× 100%
=
67,470,147
509,644,355
× 100%
= 13.24%
=
85,596,945
533,532,722
× 100%
= 16.04%
The GER in 2013
(16.04) is higher than
the GPM in 2012
(13.24). It means the
general expenses are
high and not well
managed 2013.
Financial Expenses
Ratio (FER)
𝑇𝑜𝑡𝑎𝑙 𝐹𝑖𝑛𝑎𝑛𝑐𝑖𝑎𝑙 𝐸𝑥𝑝𝑒𝑛𝑠𝑒
𝑁𝑒𝑡 𝑆𝑎𝑙𝑒𝑠
× 100%
=
18,457,247
509,644,355
× 100%
= 3.62%
=
15,170,850
533,532,722
× 100%
= 2.84%
The FER in 2013 (2.84)
is lower than the FER in
2014 (3.62). It means
the financial expenses
are low and well
managed.

8. 8
Liquidity Ratio
The following table shows the liquidity ratio calculation and interpretation for LBS Bina Group
Sdn Bhd in the year 2012 and 2013.
Liquidity Ratio 2012 2013 Interpretation
Working Capital Ratio
(WCR)
𝑇𝑜𝑡𝑎𝑙 𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝐴𝑠𝑠𝑒𝑡
𝑇𝑜𝑡𝑎𝑙 𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝐿𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖 𝑒 𝑠
=
927,829,389
520,720,661
= 1.78 ∶ 1
=
925,492,766
609,599,483
= 1.52 ∶ 1
Working Capital has
decreased from 1.78 : 1
to 1.52 : 1 during 2012
to 2013 which means
that the ability to pay off
its current liabilities by
using current assets is
getting worse.
Stability Ratio
The following table shows the stability ratio calculation and interpretation for LBS Bina Group
Sdn Bhd in the year 2012 and 2013.
Stability Ratios 2012 2013 Interpretation
Total Debt Ratio
(TDR)
𝑇𝑜𝑡𝑎𝑙 𝐿𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠
𝑇𝑜𝑡𝑎𝑙 𝐴𝑠𝑠𝑒𝑡𝑠
× 100%
=
908,176,834
1,435,008,317
× 100%
= 63%
=
1,137,172,437
2,009,812,670
× 100%
= 57%
Total debt has decreased
from 0.63 to 0.57 during
the year 2012 to 2013
which means that the
total debt level has
lower down.
Inventory Turnover
Ratio (ITR)
365÷
𝐶𝑜𝑠𝑡 𝑜𝑓 𝐺𝑜𝑜𝑑𝑠 𝑆𝑜𝑙𝑑
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦
= 365 𝑑𝑎𝑦𝑠
÷
363,416,449
(13,593,510 + 17,850,045) ÷ 2
= 365 𝑑𝑎𝑦𝑠 ÷
363,416,449
15,721,777.5
= 15.79 𝑑𝑎𝑦𝑠
= 365 𝑑𝑎𝑦𝑠
÷
364,955,568
(22,575,116 + 13,593,510) ÷ 2
= 365 𝑑𝑎𝑦𝑠 ÷
364,955,568
18,084,313
= 18.09 𝑑𝑎𝑦𝑠
Stock Turnover has
increased from 15.79
days to 18.09 days
during year 2012 to
2013 which means that
the business is selling
the stocks slower.
Interest Coverage
Ratio (ICR)
𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝐸𝑥𝑝𝑒𝑛𝑠𝑒+ 𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡
𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝐸𝑥𝑝𝑒𝑛𝑠𝑒
=
39,003,430 + 18,457,247
18,457,247
=
57,460,677
18,457,247
= 3.11 𝑡𝑖𝑚𝑒𝑠
=
397,323,654 + 15,170,850
15,170,850
=
412,494,504
15,170,850
= 27.19 𝑡𝑖𝑚𝑒𝑠
Interest coverage has
increased from 3.11 to
27.19 from year 2012 to
2013. This means that
the business’s ability to
pay its interest expenses
is getting better.

9. 9
Price Earning Ratio (P/E Ratio)
2012
Basic earnings per share: 0.097
Current share price: 0.84
P/E Ratio
=
𝑪𝒖𝒓𝒓𝒆𝒏𝒕 𝒔𝒉𝒂𝒓𝒆 𝒑𝒓𝒊𝒄𝒆
𝑩𝒂𝒔𝒊𝒄 𝒆𝒂𝒓𝒏𝒊𝒏𝒈𝒔 𝒑𝒆𝒓 𝒔𝒉𝒂𝒓𝒆
=
𝟎.𝟖𝟒
𝟎.𝟎𝟗𝟕
= 8.66 times
2013
Basic earnings per share: 0.96
Current share price: 1.56
P/E Ratio
=
𝑪𝒖𝒓𝒓𝒆𝒏𝒕 𝒔𝒉𝒂𝒓𝒆 𝒑𝒓𝒊𝒄𝒆
𝑩𝒂𝒔𝒊𝒄 𝒆𝒂𝒓𝒏𝒊𝒏𝒈𝒔 𝒑𝒆𝒓 𝒔𝒉𝒂𝒓𝒆
=
𝟏.𝟓𝟔
𝟎.𝟗𝟔
= 1.63 times
The P/E ratio measures how expensive a share is. In the year 2012, the P/E ratio is 8.66 while the
P/E ratio in year 2013 is 1.63. This means that the share in year 2013 is less expensive compared
to the share in year 2012. The P/E ratio of 8.66 in year 2012 indicates that the investor will need
to wait for nearly 8.66 years to recoup the investment while the P/E ratio of 1.63 in year 2013
indicates that the investor will need to wait for nearly 1.63 years to recoup the investment.

10. 10
Share Price
LBS Bina Group Berhad(5789.KL)
FTSE Bursa Malaysia KLCI (^KLSE)
Based on the graph above, it shows that the share price for LBS Bina Group Berhad and index for
FTSE Bursa Malaysia KLCI. Before determining whether to invest in either in a company or an
overall market share KLCI, which company has a better percentage over the time period from
January 2015 to December 2015 must be understood. Hence, 4 different points of time will be
viewed to determine the performance of both the graph.

11. 11
First point of time, the share price for LBS Bina Group Berhad is 1.6800 on 19 May 2015, and the
index for FTSE Bursa Malaysia KLCI is 1809.72. At 7 July 2015, the share price decrease to
1.6000 and the index also decrease to 1712.30. The decrease of share price is (1.6000-
1.6800)/1.6800 = -4.76%, whereas the index changes is (1712.30-1809.72)/ 1809.72= -5.38%.
This is to say that the performance of the index is worse than the company.
The share price for LBS Bina Group Berhad is 1.2800 on 1 September 2015, and the index for
FTSE Bursa Malaysia KLCI is 1609.21. At 1st October 2015, the share price increase to 1.3400
and the index increase to 1633.93. The increase of share price is (1.3400-1.2800)/1.2800 = 4.69%,
whereas the index changes is (1633.93-1609.21)/1609.21= 1.54%. As such, the performance of
the company is better than the index.
For the third point of the graph, on 4 February 2015 which the share price is 1.5700 for LBS Bina
Group Berhad and the index for FTSE Bursa Malaysia KLCI is 1815.86. At 25 March 2015, the
share price decrease to 1.5200 and the index increase to 1819.10. The decrease of share price is
(1.5200-1.5700)/1.5700 = -3.18%, whereas the index changes is (1819.10-1815.86)/1815.86=
0.18%. Hence the performance of the index is better than the company this time.
For the final point of the graph, on 25 November 2015 which the share price is 1.3500 for LBS
Bina Group Berhad and the index for FTSE Bursa Malaysia KLCI is 1684.42. At 25 December
2015, the share price increase to 1.3900 and the index decrease to 1652.96. The increase of share
price is (1.3900-1.3500)/1.3500 = 2.96%, whereas the index changes is (1652.96-
1684.42)/1684.42= -1.87%. Hence the performance of the index is worse than the company this
time.
By comparing LBS Bina Group Berhad with the overall market share KLCI, FTSE Bursa Malaysia
KLCI is continuously dropping, while LBS Bina Group is increasing although there are times
where it dropped but not as bad as FTSE Bursa Malaysia KLCI. Furthermore, the 4 points of time
that has been calculated shows that FTSE Bursa Malaysia KLCI is not recommended for investing
in.

12. 12
Investment Recommendation
For our group’s discussion, we are willing to invest on this company. We made the
decision according to three factors which are profitability, stability and share price. A company’s
financial situation can be analyses by these three factors and we are going to explain why we
made the choice and eleborate about the reason.
First of all, there’s some incresement of LBS Bina Berhad which is shown obviouly in
the calculation such as, Return of Equility(ROE), Net Profit Margin Ratio(NPM), Gross Profit
Margin Ratio(GPM), Total Debt Ratio(TDR) and Interest Coverage Ratio(ICR). On the other
hand, there is also some decreasement that shown on calculation table such as General Expenses
Ratio(GER), Working Capital Ratio(WCR) and Inventory Turnover Ratio(ITR).
The profit of the company is definitely earning and is quite high compare to the previous
year, so we can invest on this company and it surely will have an amount of profit for the future
years. Furthermore, Total Debt Ratio(TDR) of the company had decrease so the issue of
company gone bankrupt can be neglect although the Working Capital Ratio(WCR) of the
company had decreased but it doesn’t affect the company much.
However, the market share of LBS Bina Berhad is increasing but it did dropped on a few
points so it doesn’t has a stable and strong foundation for the share. But as a investor, we do need
to bet on the market sometimes so we neglect about the stability of the company since the market
share was increasing.
At last, our group member trusted that the company will have a good result as it will earn
more profit and the market share will be more stable as the time past.

13. 13
Appendix
Statements of Financial Position (2012)

14. 14

15. 15

16. 16

17. 17
Statement of Comprehensive Income (2012)

18. 18

19. 19
Notes to the Financial Statements (2012)

20. 20
Statements of Financial Position (2013)

21. 21

22. 22
Statement of Comprehensive Income (2013)

23. 23

24. 24
Notes to the Financial Statements (2013)

25. 25
References
I3investor File Server - LBS-AnnualReport2012.pdf | I3investor. (n.d.). Retrieved February 02,
2016, from http://klse.i3investor.com/servlets/staticfile/220496.jsp
I3investor File Server - LBS-AnnualReport2013.pdf | I3investor. (n.d.). Retrieved February 02,
2016, from http://klse.i3investor.com/servlets/staticfile/241879.jsp
5789.KL Historical Prices | LBS BINA GROUP BHD Stock - Yahoo! Finance. (n.d.). Retrieved
February 02, 2016, from http://finance.yahoo.com/q/hp?s=5789.KL
LBS: Property Collections. (n.d.). Retrieved February 03, 2016, from
http://www.lbs.com.my/property-collections/
Zhuhai to have a Malaysia-China culture centre - Nation | The Star Online. (n.d.). Retrieved
February 03, 2016, from http://www.thestar.com.my/news/nation/2015/07/09/zhuhai-to-have-a-
msiachina-culture-centre-expansion-plan-to-include-museum-on-admiral-zheng-he-who-v/
LBS Bina and China's Zhuhai in trade deal - Business News | The Star Online. (n.d.). Retrieved
February 03, 2016, from http://www.thestar.com.my/business/business-news/2015/09/21/lbs-
bina-and-chinas-zhuhai-in-trade-deal/