Malaysia Steel Works (KL) Berhad was founded in 1971 as a steel manufacturer in Malaysia. Over the years, it has upgraded its facilities and increased production capacity. By 1998, its meltshop in Bukit Raja entered commercial production and became one of the most advanced in the region. The company plans to further increase meltshop capacity to 700,000 metric tonnes of billets per year by 2014. According to the financial ratio analysis, the company's profitability has increased from 2012 to 2013 as evidenced by a higher return on equity and net profit margin. Overall expenses are also better controlled compared to the previous year.
Kossan's Financial Evaluation based on their annual financial statement from 2013 to 2015. We evaluate based on theory or formula from subject FIN745 (Financial Management). We also compare the result with Top Glove performance as Industry average.
Kossan's Financial Evaluation based on their annual financial statement from 2013 to 2015. We evaluate based on theory or formula from subject FIN745 (Financial Management). We also compare the result with Top Glove performance as Industry average.
Kossan's Financial Evaluation based on their annual financial statement from 2013 to 2015. We evaluate based on theory or formula from subject FIN745 (Financial Management). We also compare the result with Top Glove performance as Industry average.
1. Business industry selected: Hair salon
2. Royce Hair Salon Located in Oakland Commercial Centre, Seremban. Founded in 2012 by Mr. Royce. Name: Royce Hair Saloon Only one branch as of today.
3. SERVICES OFFERED BY ROYCE HAIR SALON: Haircut Hairwash Hair treatment Highlighting Coloring
4. Daily number of customers 8-20 Number of employees: 2
5. Basic Information About the Owner: Royce is an Indian orphan who is raised by a Chinese family. Jalan Haruan of the Oakland Commercial Centre in the new town of Seremban, which is called Seremban 2 He only speaks Mandarin and Cantonese. His dream was to become a professional hairstylist and start up his own hair salon one day.
6. ReStyle Hair Salon Located in Syopz Mall in Taylor’s University Lakeside Campus. Part of the A Cut Above Group. Founded by Winnie Loo, award-winning hairstylist and chairwoman of A Cut Above Group. Established in 2009. There are three other branches that are located in 1 Mont’Kiara, Tesco Mutiara Damansara and Sunway Pyramid.
7. Services Provided by ReStyle Hair Salon Haircut Hairwash Hair treatment Perming Highlighting Coloring Brazilian Keratin Treatment Shampooing and Blowdry
8. Motive of Opening The Hair Salon To target students and hostel residents to buy the hairstyling services because of its convenience.
9. Daily Number of Customers: 15 (On Average) Number of Employees: 2
10. Comparative Analysis of the Businesses’ Competitive Traits
11. 10 Main Competitors: - Impress Hair Salon - Kenji Hair Salon - Domnik Hair Salon 8 Main competitors: - Spazio Hair Salon - Hair Fonts - APT Hair Salon Number of Competitors
12. Brief Bios of Top 3 Competitors 1. Impress Hair Salon • Located in Kemayan Square. • Established much earlier than Royce Hair Salon. 1. Spazio Hair Salon • Located in SS15, Subang Jaya • Established in 2010. 2. Kenji Hair Salon • Located in Biz Avenue. • Relatively reputable because of its location. • Offers promotion of their services in Groupon MY. 2. Hair Fonts • Located in Sunway Pyramid. • Groupon has many deals with Hair Fonts in which customers can purchase them at a cheaper price. 3. Domnik Hair Salon • Located inside of Terminal One Shopping Centre. • It is one of the few hair salons inside the mall. • Offers quick haircut. 3. APT Hair Salon • Located in Sunway Pyramid • Consists of well-trained hairstylist. • Provides professional hairstyling courses.
13. Strategies Used to Compete With Competitors Strategy 1: Pricing • Cheap pricing - Only RM 20 for a standard haircut for both male and female. • Affordable pricing. • Student pricing. • Various packages at a cheaper price as compared to buying the service sseparately
14. Strategies Used to Compete With Competitors Strategy 2: Service and Product Variety • Offers all services that a standard hair salon has. • Have various hair care prod
Techniques to optimize the pagerank algorithm usually fall in two categories. One is to try reducing the work per iteration, and the other is to try reducing the number of iterations. These goals are often at odds with one another. Skipping computation on vertices which have already converged has the potential to save iteration time. Skipping in-identical vertices, with the same in-links, helps reduce duplicate computations and thus could help reduce iteration time. Road networks often have chains which can be short-circuited before pagerank computation to improve performance. Final ranks of chain nodes can be easily calculated. This could reduce both the iteration time, and the number of iterations. If a graph has no dangling nodes, pagerank of each strongly connected component can be computed in topological order. This could help reduce the iteration time, no. of iterations, and also enable multi-iteration concurrency in pagerank computation. The combination of all of the above methods is the STICD algorithm. [sticd] For dynamic graphs, unchanged components whose ranks are unaffected can be skipped altogether.
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Empowering the Data Analytics Ecosystem: A Laser Focus on Value
The data analytics ecosystem thrives when every component functions at its peak, unlocking the true potential of data. Here's a laser focus on key areas for an empowered ecosystem:
1. Democratize Access, Not Data:
Granular Access Controls: Provide users with self-service tools tailored to their specific needs, preventing data overload and misuse.
Data Catalogs: Implement robust data catalogs for easy discovery and understanding of available data sources.
2. Foster Collaboration with Clear Roles:
Data Mesh Architecture: Break down data silos by creating a distributed data ownership model with clear ownership and responsibilities.
Collaborative Workspaces: Utilize interactive platforms where data scientists, analysts, and domain experts can work seamlessly together.
3. Leverage Advanced Analytics Strategically:
AI-powered Automation: Automate repetitive tasks like data cleaning and feature engineering, freeing up data talent for higher-level analysis.
Right-Tool Selection: Strategically choose the most effective advanced analytics techniques (e.g., AI, ML) based on specific business problems.
4. Prioritize Data Quality with Automation:
Automated Data Validation: Implement automated data quality checks to identify and rectify errors at the source, minimizing downstream issues.
Data Lineage Tracking: Track the flow of data throughout the ecosystem, ensuring transparency and facilitating root cause analysis for errors.
5. Cultivate a Data-Driven Mindset:
Metrics-Driven Performance Management: Align KPIs and performance metrics with data-driven insights to ensure actionable decision making.
Data Storytelling Workshops: Equip stakeholders with the skills to translate complex data findings into compelling narratives that drive action.
Benefits of a Precise Ecosystem:
Sharpened Focus: Precise access and clear roles ensure everyone works with the most relevant data, maximizing efficiency.
Actionable Insights: Strategic analytics and automated quality checks lead to more reliable and actionable data insights.
Continuous Improvement: Data-driven performance management fosters a culture of learning and continuous improvement.
Sustainable Growth: Empowered by data, organizations can make informed decisions to drive sustainable growth and innovation.
By focusing on these precise actions, organizations can create an empowered data analytics ecosystem that delivers real value by driving data-driven decisions and maximizing the return on their data investment.
1. School Of Architecture, Building & Design
Foundation In Natural & Built Environment
Assignment Title : FinancialRatio Analysis
Group Members :
NAME STUDENT ID
SEET TIONG HONG 0320438
WONG DE-VIN 0319814
BRYAN TEH QING DA 0318590
Basic Accounting [ACC30205 / FNBE0145]
Lecturer : Chang JauHo
Submission Date : 4th June 2015
Background History Of MASTEEL
Malaysia Steel Works (KL) Berhad was founded in 1971 at Petaling Jaya, Selangor
as a steel manufacturer producing commercial grade mild steel round bars and steel
billets at their rolling mill.
To further improve their competitiveness, they had upgraded their mill to become a
entirely continuous mill with the addition of a new reheating furnace which was
2. able to utilise one ton of steel billets. Besides, the company had further increased
the mill capacity to 450,000 metric tonne every year.
Due to ever rising demand of their customers, they installed a thermal quenching
line that could producegrade 500 deformed bars. Notably, the mill obtained the
ISO 9002 certification recognizing the company commitment and dedication to
quality management system.
A new milestone in the history of Malaysia Steel Works (KL) Berhad was realised
when their meltshop in Bukit Raja entered into commercial productionin 1998.
Their Danieli supplied billet production plant became one of the most advanced
meltshop in the region as the electric arc furnace was featured with several
advanced components such as ultra-high power transformers (UHP), eccentric
bottom tapping configuration (EBT) and fully automated furnace process control
and alloy additive plant. In order to increase the output and quality of their
products suchas steel bars and steel billets, the company added a refining ladle
furnace.
As the company is growing stronger with strong balance sheet, they plan to go
even further to increase their capacity of the meltshop to 700,000 metric tonne of
billets per year by installing a multi-stand large curvature continuous casting
machine which could cast high-grade billets up to 160mm x 160mm by end of
2014.
Furthermore, the domestic steel usage is going to increase due to several key
projects under Malaysia’s Economic Transformation Programme such as Sungai
Buloh-Kajang MRT and Klang Valley LRT extension. This would boostthe
company’s revenue of 2015.
The company is one of the premier steel manufacturer in Malaysia thanks to their
high consistency of the quality products producedbythe meltshop.
3. Steel Billets Rolling Steel Mill
Financial Ration Of MASTEEL
Return Of Equity (ROE)
𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
)
× 100%
ROE for 2013 =(
27,014,000
540,501,500
)×100%
4. = 5%
ROE for 2012 = (
24,346,000
540,501,500
) ×100%
= 4.5%
Over the period of year 2012 and 2013, the ROE of the business has
increased from 4.5% to 5% . The owner is getting more return from his
capital.
Net Profit Margin (NPM)
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
) × 100%
NPM for 2013 = (
27,014,000
1,375,441,000
)×100%
= 1.96%
NPM for 2012 = (
24,346,000
1,312,189,000
) ×100%
= 1.86%
5. During the period, the NPM has a minor increase from 1.86% to 1.96%.
This means that the ability of the business to control its overall expenses
is slightly better compared to the previous year.
Gross Profit Margin (GPM)
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
) × 100%
GPM for 2013 = (
86,791,000
1,375,441,000
)×100%
= 6.31%
GPM for 2012 = (
75,153,000
1,312,189,000
)×100%
= 5.73%
Over the period of year 2012 to 2013, the GPM has increased from
5.73% to 6.31%. The business is getting better in terms of their ability to
control its cost of goods sold expenses for year 2013 than 2012.
6. Selling Expenses Ration (SER)
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
) × 100%
SER for 2013 = (
17,828,000
1,375,441,000
)×100%
= 1.3%
SER for 2012 =(
19,544,000
1,312,189,000
) ×100%
= 1.49%
The SER of the business has slightly decreased from 1.49% to 1.3%
throughout the year. It means that the business’s ability to control its
selling expenses is getting better.
General Expenses Ratio (GER)
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
) × 100%
7. GER for 2013 = (
27,199,000
1,375,441,000
) ×100%
= 1.98%
GER for 2012 = (
19,352,000
1,312,189,000
) ×100%
= 1.47%
The GER has increased from 1.47% to 1.98% over the period of year
2012 and 2013. The business’s ability of controlling its general expenses
is worse in year 2012 than 2013.
Financial Expenses Ratio (FER)
𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
) × 100%
FER for 2013 = (
15,140,000
1,375,441,000
)×100%
= 1.1%
FER for 2012 = (
15,261,000
1,312,189,000
)×100%
= 1.16%
8. Over the period of year 2012 and 2013, the FER has decreased by
0.05%, from 1.16% to 1.1%. In other words, the financial expenses in
year 2013 is slightly lower than 2012.
Working Capital
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
)
Working capital for 2013 = (
523,506,000
435,500,000
)
= 1.2 : 1
Working capital for 2012 = (
462,280,000
368,580,000
)
= 1.25 : 1
Over the period of 2012 to 2013 the working capital of the business has
dropped from 1.25:1 to 1.2:1. The business’s ability to pay of its current
liabilities is not as good as the previous year. In addition, it does not
meet the criteria of a ratio 2:1.
9. Total Debt
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
) × 100%
Total Debt for 2013 =(
460,755,000
1,015,001,000
) ×100%
= 45.4%
Total Debt for 2012 =(
404,028,000
930,785,000
) ×100%
= 43.4%
From the year 2012 to 2013, the total debt has increased from 43.4% to
45.4%. The total debt of this business has increased. In addition, it still
satisfies the requirement of a maximum of 50% debt.
Stock Turnover
𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
= 365 ÷ (
𝑅𝑅𝑅𝑅 𝑅𝑅 𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
)
10. Stock Turnover for 2013 = 365 ÷ (
1,288,650,000
200,838,000
)
= 57 days
Stock Turnover for 2012 =365 ÷ (
1,237,036,000
200,838,000
)
= 60 days
During the period of year 2012 and 2013, The stock turnover has
decreased from 60 days to 57 days. The business sold its goods faster in
2013 compared to 2012.
Debtor Turnover
𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
= 365 ÷ (
𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅
)
Debtor Turnover 2013 =
365 ÷ (
687,720,500
[(239,952,000 + 222,703,000) / 2]
) = 123 days
Debtor Turnover 2012 =
11. 365 ÷ (
656,094,500
[(239,952,000 + 222,703,000) / 2]
) = 129 days
Over the period of year 2012 to 2013, the debtor turnover of the business
has decreased from 129 days to 123 days. It means that the business
received their money faster than the previous year.
*(Due to the absence of credit sales figure in the annual report, we have
taken the revenues of both years and divided by 50%)
Interest Coverage
𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
= (
𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 + 𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅𝑅𝑅𝑅
)
Interest coverage for 2013 = (
15,140,000 + 27,014,000
15,140,000
)
= 2.78 times
Interest coverage for 2012 = (
15,261,000 + 24,346,000
15,261,000
)
= 2.6 times
During the period of year 2012 to 2013, the interest coverage of the
business increased from 2.6 times to 2.78 times. It also means the
12. business ability to pay off its interest expenses is better. However a
business should never fall below 5 times.
P/E Ratio
P/E Ratio = (
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
𝑅𝑅𝑅𝑅𝑅𝑅𝑅 𝑅𝑅𝑅 𝑅𝑅𝑅𝑅𝑅
)
= (
0.62
0.1238
)
= 5.008
Based on the information we acquired from the webpage of Bursa
Malaysia dated 3rd June 2015, the share price of MASTEEL is RM 0.62
and its earning per share is RM 0.1238. This means the P/E ratio of
Malaysia Steel Works Berhad is 5.008 (0.62/0.1238).
CONCLUSION
13. Based on the information we had acquired through few sources, the profitability of
the business is pretty satisfying. It has clearly shown that the owner is getting more
return from his capital invested. The return of equity shows a positive increased by
0.5% from 4.5% to 5% over the period of year 2012 and 2013. Secondly, this
business has also improved in terms of controlling its overall expenses over the
year from the year 2012, Net Profit Margin shows a clear figure of a minor
increase from 1.86% to 1.96%. Other than that, based on the increased numbers in
the Gross Profit Margin (GPM), the business is getting better in terms of their
ability to controlits costof goods sold expenses. Selling expenses are also being
well controlled by the company as the Selling Expenses Ratio of the business had a
slight decrease over the year 2012 and 2013. It has also shown a lower figure for
the financial expenses of the business from year 2012 to the year 2013.
Furthermore, the total debt of this business over the year 2012 and 2013 has
increased from 43.4% to 45.4%. Although the total debt incurred has increased
slightly, but it still remains below the maximum debtlimit of 50%. The business
has fulfilled the maximum total debt of 50%. Moreover, the business’s stock
turnover has decreases from 60 days to 57 days which shows a significantly good
result as the business managed to sell its goods at a faster rate at the year 2013
compared to year 2012. Not only that, the debtor turnover for the company has also
decreased from 129 days to 123 days. It also means that the business received their
money faster than the previous year. During the period of year 2012 to 2013, the
business’s interest coverage has also increased from 2.6 times to 2.78 times which
means that the business ability to pay off its interest expense has improved too.
However, on the down side, based on the figure of the working capital of the
business, the business has dropped fromthe ratio of 1.25:1 to 1.2:1. It also means
that the business’s ability to pay of its current liabilities is not as good as the
previous year.
Finally, the P/E ratio of MASTEEL is as low as 5.008. It lies below the reasonable
P/E ratio which is 15. Although there are few lacklustre results acquired by
calculating the financial ratios, this company is still worth investing as most of the
14. results are positive and improving. Investors are encouraged to consider this steel
manufacturing company into their investment portfolios. Our team would
RECOMMEND this company to the canny investors. Investors are required to
invest at own risks. Happy investing.
Appendix
Balance Sheet For The Year Ended On 31st December 2013
1) TotalAssets
19. REFERENCE
1) Company History. (n.d.). Retrieved June 1, 2015, from
http://www.masteel.com.my/about-2/brief-history-milestone/
2) Malaysia Steel Works (KL) Berhad - Information. (n.d.). Retrieved June 1,
2015, from http://www.bursamalaysia.com/market/listed-companies/list-of-
companies/plc-profile.html?stock_code=5098
20. 3) Liz, L. (2014, August 30). Masteel's will of steel - Business News | The Star
Online. Retrieved June 1, 2015, from
http://www.thestar.com.my/Business/Business-News/2014/08/30/Masteels-
will-of-steel-Steel-producer-keen-for-rail-project-to-run-alongside-its-core-
business/?style=biz