1. KOLEJ MULTIMEDIA
JALAN GURNEY KIRI, KUALA LUMPUR
Intro to Financial Management
FIN 2063
NAME :
I/D NO. :
COURSE :
LECTURER :

3. COMPANY BACKGROUND
OVERVIEW
The late Tan Sri Konosuke Matsushita founded the Matsushita companies. The
Matsushita miracle began with his vision to contribute to the well-being of mankind by
providing reasonably-priced products and services in sufficient quantities.
Today that vision has turned into a giant global business in more than 130 countries
around the world.
The famous brand name 'Panasonic' is easily recognised. But behind this popular
household name and the extensive range of consumer durables that carry its label
stands its manufacturer, the foundation of the brand's success, Panasonic
Manufacturing Malaysia Berhad - PMMA.
The PMMA story in Malaysia is an inspirational one made remarkable and reflected in
its string of proud achievements that have successfully spanned two decades. Being the
first plant to manufacture household electrical appliances in Malaysia, the Company
confidently took on its parent company in Japan.
Throughout the years, the corporation has observed a swift progress from its humble
start as producer of dry-cell batteries to Malaysia's leading manufacturer of
sophisticated electrical appliances.
Today, the Panasonic brand name has emerged as one of the most welcome and
trusted brand names for electrical home appliances chosen by most Malaysian
households. At Panasonic, we manufacture, operate, deliver, and maintain a series of
product range with globally competitive models under the Panasonic brand name to
the market, incorporating new features, enhanced capability and improved quality, and
equally important, with our excellent after-sales-services.

4. HISTORY
PMMA was born from the pursuit of two burning ambitions. Malaysia's embarking on an
ambitious industrialisation programme aimed at import substitution in the early '60's and
Matsushita's pursuit of an active internationalisation policy .
Work on the factory started in early 1966 and PMMA was the first factory in the newly-
opened industrial site. With the help of 15 pioneer workers mainly from Klang and 20
Japanese engineers, PMMA produced it first product - dry cell batteries, black and white
television sets, electric fans and later, refrigerators.
After Year 2005, MELCOM is known as PMMA.

5. BOARD OF DIRECTOR’S
Tan Sri Datuk Asmat bin Kamaludin : Chairman,Independent Non-Executive
Director
Naoya Nishiwaki : Managing Director
Tan Sri Dato’ Zaki bin Tun Azmi : Independent Non-Executive Director
Hiroshi Fukutomi : Executive Director
Raja Dato’ Seri Abdul Aziz bin Raja Salim : Independent Non-Executive Director
Ramanaidu a/l Semenchalam : Executive Director
Razman Hafidz bin Abu Zarim : Independent Non-Executive Director
Soh Beng Kuan : Executive Director
Chen Ah Huat : Executive Director
Hiroshi Nakamura : Non-Independent Non-Executive
Director
Hironori Otsuka : Executive Director
Nobuyuki Kochi : Executive Director

6. THE COMPANY PRODUCT
This company nature of business is an electronic devices which is divided into two types of
product that been manufactured. The type of product is Kitchen Appliences and Life
Appliences.
Kitchen Appliences
1. Rice cooker
2. Slow cooker
3. Blender
4. Juicer
5. Food processer
Life Appliences
1. Home shower
2. Fan
3. Iron
4. Vaccuum cleaner

7. PROFITABILITY RATIO
Gross Profit Margin =
Year Gross Profit Sales Gross profit margin
(%)
2008 RM 79652 RM 562490 14.16
2009 RM 89799 RM 600868 14.94
2010 RM 133633 RM 679764 19.66
Gross profit margin
25.00
20.00
15.00
Gross profit margin (%)
10.00
5.00
0.00
2008 2009 2010
The gross profit margin increase within these 3 years. It increase 0.78% in year 2009
and increase highly on 2010 around 4.72% of ratio. It shows that this increasing matter
is good for the company especially on 2010.

8. Operating Profit Margin =
Year Operating income Revenue Operating Profit
Margin (% )
2008 RM 61618 RM 562490 10.95
2009 RM 55086 RM 600868 9.17
2010 RM 76720 RM 679764 11.29
Operating Profit Margin
12.00
10.00
8.00
6.00
Operating Profit Margin
4.00
2.00
0.00
2008 2009 2010
The graph shows that this ratio is not stabilized during year 2009. It decrease around
1.78% of ratio but increase around 2.12% of ratio on year 2010. This means that this
company make lot of revenue and less expenses during the year 2010.

9. Net Profit Margin =
Year Net Income Sales Net Profit Margin (%)
2008 RM 48478 RM 562490 8.62
2009 RM 43247 RM 600868 7.20
2010 RM 61199 RM 679764 9.0
Net Profit Margin
10.00
9.00
8.00
7.00
6.00
5.00
Net Profit Margin
4.00
3.00
2.00
1.00
0.00
2008 2009 2010
In the year 2008, the net profit margin is 8.62% but it decrease around 1.42% on year
2009. It increase back around 1.0% on year 2010. It shows that this company pricing
strategies and how well it controls costs at the year 2010 is very good and well-
organized.

10. Return on Asset (ROA) =
Year Net Income Average Total Return on Asset
Asset (ROA)
2008 RM 48478 RM 590596 0.082
2009 RM 43247 RM 579729 0.075
2010 RM 61199 RM 639719 0.096
Return on Asset (ROA)
0.12
0.1
0.08
0.06
Return on Asset (ROA)
0.04
0.02
0
2008 2009 2010
In the year 2009, the ROA decrease 0.007% but it increase back 0.021% by the year
2010. It shows that this company generating revenue by the year 2010 and shows that
in the year 2009 , the company did not uses its assets effectively.

11. ROA Du-Pont =
Year Net Income Net Sales Average Total Return on Asset
Asset (ROA) Du Pont
2008 RM 48478 RM 562490 RM 590596 0.082
2009 RM 43247 RM 600868 RM 579729 0.075
2010 RM 61199 RM 679764 RM 639719 0.096
Return on Asset (ROA) Du Pont
0.120
0.100
0.080
0.060
Return on Asset (ROA) Du Pont
0.040
0.020
0.000
2008 2009 2010
Return on Asset Du Pont is similar as ROA usuall. On the year 2009, the company
didn’t manage to use the asset in proper sequence and because of that the ratio is the
lowest within the 3 years. On year 2010 is the highest ratio shows the stabilize the
asset of the company.

12. Return on Equity (ROE) =
Year Net Income Common Return on Equity
Equity (ROE)
2008 RM 48478 RM 484083 0.10
2009 RM 43247 RM 493229 0.088
2010 RM 61199 RM 497445 0.123
Return on Equity (ROE)
0.14
0.12
0.1
0.08
0.06 Return on Equity (ROE)
0.04
0.02
0
2008 2009 2010
The ROE decrease 0.012% at the year 2009 and it shows that this company efficiency
at generating profit from every unit of shareholder by that year was very low. ROE
shows how well a company uses investment funds to generate earnings growth. But in
the year of 2010, the ROE increase 0.035% and it consider desirable.

13. ROE Du-Pont =
Year Return on Asset Debt Ratio ROE Du-Pont
(ROA)
2008 0.082 0.165 0.0982
2009 0.075 0.165 0.0898
2010 0.096 0.222 0.1232
ROE Du-Pont
0.1400
0.1200
0.1000
0.0800
0.0600 ROE Du-Pont
0.0400
0.0200
0.0000
2008 2009 2010
With the Du-Pont formula, the ROE is highly increase by the year 2010 around
0.0334% from the year 2009. It decrease 0.0084% by the year 2009 from the year
2008. The Du Pont identity breaks down Return on Equity (that is, the returns that
investors receive from the firm) into three distinct elements. This analysis enables the
analyst to understand the source of superior return by comparison with companies in
similar industries.

14. LIQUIDITY RATIO
Net working capital = –
Year Current Asset Current Liability Net Working Capital
2008 RM 522127 RM 90947 RM 431180
2009 RM 512536 RM 94169 RM 418367
2010 RM 561221 RM 139801 RM 421420
Net Working Capital
RM435,000
RM430,000
RM425,000
Net Working Capital
RM420,000
RM415,000
RM410,000
2008 2009 2010
The net working capital for the year 2008 was the highest.However, the ratio was
decreased in the year 2009. The different between 2008 and 2009 is RM 12813 but
increase for a 1.01% in the year 2010, RM 3053. Positive working capital is required
to ensure that a firm is able to continue its operations and that it has sufficient funds to
satisfy both maturing short-term debt and upcoming operational expenses.

15. Current Ratio =
Year Current Asset Current Liability Current Ratio
2008 RM 522127 RM 90947 5.74
2009 RM 512536 RM 94169 5.44
2010 RM 561221 RM 139801 4.01
Current Ratio
7.00
6.00
5.00
4.00
3.00 Current Ratio
2.00
1.00
0.00
2008 2009 2010
The current ratio decrease 0.3 from the year 2008 to 2009 and decrease again 1.43
from the year 2009 to 2010. A current ratio of assets to liabilities of 2:1 is usually
considered to be acceptable. This current ratio measures whether or not a firm has
enough resources to pay its debts over the next 12 months. A high current ratio is
better than a low current ratio, because a high current ratio means that the company is
more likely to meet its liabilities which fall due in the next 12 months.

16. Quick Ratio =
Year Current Asset Inventories Current Quick Ratio
Liability
2008 RM 522127 RM 12352 RM 90947 5.61
2009 RM 512536 RM 9064 RM 94169 5.35
2010 RM 561221 RM 16373 RM 139801 3.90
Quick Ratio
6.00
5.00
4.00
3.00
Quick Ratio
2.00
1.00
0.00
2008 2009 2010
The quick ratio is to measures the ability of a company to use its near cash or quick
assets to extinguish or retire its current liabilities immediately. At the year 2009, it
decrease 10.95 from the year 2008 and decrease again 1.45 at the year 2010 from the
year 2009. A company with a Quick Ratio of less than 1 can not currently pay back its
current liabilities. In general, the higher the ratio, the greater the company's liquidity.

17. Quick Asset =
Year Cash Acc Recv Quick Asset
2008 RM 460551 RM 48120 RM 508631
2009 RM 466562 RM 35432 RM 501994
2010 RM 496002 RM 48846 RM 544848
Quick Asset
RM550,000
RM540,000
RM530,000
RM520,000
RM510,000 Quick Asset
RM500,000
RM490,000
RM480,000
2008 2009 2010
The quick assets ratio is to measure how many account receivable can be convert into
cash. It decrease from the year 2008 to year 2009 around RM 6637 but increase from
the year 2009 to year 2010 around RM 42854.

18. SOLVENCY RATIO
Debt Ratio =
Year Total Liability Total Asset Debt Ratio
2008 RM 97367 RM 590596 0.165
2009 RM 95646 RM 579729 0.165
2010 RM 142274 RM 639719 0.222
Debt Ratio
0.250
0.200
0.150
Debt Ratio
0.100
0.050
0.000
2008 2009 2010
Debt ratio indicates that the company assets that provided via debt. The debt ratio are
equally within the years of 2008 and 2009 but increase at the year 2010 around 0.057
from the year of 2008 and 2009. The higher the ratio, the greater risk will be
associated with the firm's operation. In addition, high debt to assets ratio may indicate
low borrowing capacity of a firm, which in turn will lower the firm's financial
flexibility.

19. Total Debt Equity Ratio =
Year Total Debt Total Equity Total Debt Equity
Ratio
2008 RM 97367 RM 493229 0.1974
2009 RM 95646 RM 484083 0.1976
2010 RM 142274 RM 497445 0.2860
Total Debt Equity Ratio
0.3500
0.3000
0.2500
0.2000
0.1500 Total Debt Equity Ratio
0.1000
0.0500
0.0000
2008 2009 2010
Total debt equity ration is indicating the relative proportion of shareholders' equity and
debt used to finance a company's assets. The total equity debt is increase within the 3
years. It increase 0.0002 from year 2008 to 2009 and increase again 0.0884 from the
year 2009 to 2010. The greater a company's leverage, the higher the ratio. Generally,
companies with higher ratios are thought to be more risky because they have more
liabilities and less equity.

20. Total Equity Multiplier =
Year Total Debt Equity Total Equity
Ratio Multiplier
2008 0.1974 1.1974
2009 1+ 0.1976 1.1976
2010 0.2860 1.2860
Total Equity Multiplier
1.3000
1.2800
1.2600
1.2400
1.2200
Total Equity Multiplier
1.2000
1.1800
1.1600
1.1400
2008 2009 2010
The total equity multiplier is increases considerable around the year of 2010. It
increase 0.0002 from the year 2008 to 2009 and increase 0.0884 from the year 2009 to
year 2010. The higher the ratio is, the more the company is relying on debt to finance
it’s assets

21. EFFICIENCY RATIO
 Inventory Turnover =
Year Sales Inventory Inventory Turnover
2008 RM 562490 RM 12352 45.52
2009 RM 600868 RM 9064 66.29
2010 RM 679764 RM 15373 44.22
Inventory Turnover
70.00
60.00
50.00
40.00
30.00 Inventory Turnover
20.00
10.00
0.00
2008 2009 2010
Inventory turnover is is a measure of the number of times inventory is sold or used in a
time period such as a year. The highest inventory turnover at the year 2009. It increase
20.77 from the year 2008 to year 2009. The lowest inventory turnover is in the year
2010. It decrease 22.07 from the year 2009 to year 2010. A high inventory turnover is
generally desirable.

22.  Average Inventory Turnover Per Year =
Year Inventory Average Turnover
Turnover per Year
2008 45.52 8.02
365 Days
2009 66.29 5.51
2010 44.22 8.25
Average Turnover per Year
9.00
8.00
7.00
6.00
5.00
4.00 Average Turnover per Year
3.00
2.00
1.00
0.00
2008 2009 2010
The average turnover per year is calculated from 365 days per the value of inventory
turnover to measure how many days the inventory stay on average before it is sold.
This is how the company can measure how fast the company can sell the product. At
the year 2009, the inventory turnover decrease 2.51 from the year 2008 to year 2009.
By the year 2010, it increase back 2.74 from year 2009 to year 2010.

23.  Receivable Turnover =
Year Sales Acc Receivable Receivable Turnover
2008 RM 562490 RM 48120 11.69
2009 RM 600868 RM 35432 16.96
2010 RM 679764 RM 48846 13.92
Receivable Turnover
18.00
16.00
14.00
12.00
10.00
8.00 Receivable Turnover
6.00
4.00
2.00
0.00
2008 2009 2010
This ratio measures the number of times, on average, receivables are collected during
the period. At the year 2008, the receivable turnover is 11.69 and it increase of 5.27 on
the year 2009. By the year 2010, it decrease 3.04 from the year 2009.

24.  Day’s Sales in Receivable =
Year Receivable Day’s Sales in
Turnover Receivable
2008 11.69 31.22
365 Days
2009 16.96 21.52
2010 13.92 26.22
Day’s Sales in Receivable
35.00
30.00
25.00
20.00
15.00 Day’s Sales in Receivable
10.00
5.00
0.00
2008 2009 2010
Average number of days a firm takes to collect payments on goods sold. At year 2008,
the ratio is 31.22 and decrease 9.7 at the yaer 2009. It incerase 4.7 at the year 2010
from year 2009. So that, the average at year 2009 is very low compared year 2008 and
2010.

25.  Average Collection Period =
Year Acc Receivable Sales Average Collection
Period
2008 RM 48120 RM 562490 8.55
2009 RM 35432 RM 600868 5.90
2010 RM 48846 RM 679764 7.19
Average Collection Period
9.00
8.00
7.00
6.00
5.00
4.00 Average Collection Period
3.00
2.00
1.00
0.00
2008 2009 2010
The average collection period is the number of days, on average, that it takes a
company to collect their credit accounts or their accounts receivables. The average for
the year 2008 is higher than year 2009 and year 2010 as well. It decrease 2.65 from
year 2008 to year 2009 and increase 1.29 from the year 2009 to year 2010. If it
increases, that means this company’s accounts receivables are not liquid and not being
able to be converted into cash quickly. If the average collection period is decreasing,
the opposite is true.

26.  Average Payment Period = %
Year Acc Payable Sales Average Payment
Period
2008 RM 72042 RM 562490 12.81
2009 RM 73412 RM 600868 12.22
2010 RM 116375 RM 679764 17.12
Average Payment Period
18.00
16.00
14.00
12.00
10.00
8.00 Average Payment Period
6.00
4.00
2.00
0.00
2008 2009 2010
The average payment period ratio represents the number of days by the firm to pay its
creditors. This ratio decrease 0.59 from the year 2008 to year 2009 and increase highly
from year 2009 to year 2010 around 4.9. As the average payment period increases,
cash should increase as well, but working capital remains the same. Most companies
try to decrease the average payment period to keep their larger suppliers satisfied and
possibly take advantage of trade discounts.

27.  Total Asset Turnover =
Year Sales Total Asset Total Asset Turnover
2008 RM 562490 RM 590596 0.952
2009 RM 600868 RM 579729 1.036
2010 RM 679764 RM 639719 1.063
Total Asset Turnover
1.080
1.060
1.040
1.020
1.000
0.980
Total Asset Turnover
0.960
0.940
0.920
0.900
0.880
2008 2009 2010
Asset turnover is that measures the efficiency of a company's use of its assets in
generating sales revenue or sales income to the company. At year 2008, the total asset
turnover is 0.952 and its the lowest ratio. It increase 0.084 from year 2008 to year
2009. The ratio continuosly increase 0.027 from the year 2009 to year 2010.

28. PERFORMANCE ANALYSIS
 Earning Per Share (EPS)
Year Earning Per Share (EPS)
2008 0.80
2009 0.71
2010 1.01
Earning Per Share (EPS)
1.20
1.00
0.80
0.60
Earning Per Share (EPS)
0.40
0.20
0.00
2008 2009 2010
Earnings per share (EPS) is the amount of earnings per each outstanding share of a
company's stock. The EPS at the year 2008 is 0.80 and it increase 0.09 from the year
2008 to year 2009. This EPS increase 0.3 from the year 2009 to year 2010.

29.  Return On Net Sales =
Year Net Income Net Sales Return On Net Sales
2008 RM 48478 RM 562490 0.0862
2009 RM 43247 RM 600868 0.0720
2010 RM 61199 RM 679764 0.0900
Return On Net Sales
0.1000
0.0900
0.0800
0.0700
0.0600
0.0500
Return On Net Sales
0.0400
0.0300
0.0200
0.0100
0.0000
2008 2009 2010
Return on net sales what percentage of each ringgit of sales is made up of net income
or net profit. By the year 2008, the return on net sales is 0.0862 and it decrease 0.0142
from year 2008 to year 2009 and it increase 0.0180 from year 2009 to year 2010. An
increasing ROS indicates the company is growing more efficient, while a decreasing
ROS could signal looming financial troubles.

30.  Return on Total Asset =
Year Net Income Average Total Return on Total Asset
Asset
2008 RM 48478 RM 590596 0.082
2009 RM 43247 RM 579729 0.075
2010 RM 61199 RM 639719 0.096
Return on Total Asset
0.120
0.100
0.080
0.060
Return on Total Asset
0.040
0.020
0.000
2008 2009 2010
Return on total assets are aims to measure the company efficiency in utilizing its asset.
From year 2008 to year 2009, the asset decrease 0.007 and from year 2009 to year
2010, it increase 0.021. It shows the company that attains a level of profitability with
little asset is more efficient than a company that attains the same level of profit but
utilizing more assets. The greater a company's earnings in proportion to its assets, the
more effectively that company is said to be using its assets.