2. Financial statement ratio analysis apple
Group Member:
Ibrahim Ikram
Muhammad Adil Bhatti
Muhammad Suleman
Tauqeer Ahmed

3. Executive Summery
The Past – Steve Jobs, Steve Wozniak and Ronald Wayne established Apple on April 1,
1976 in order to sell the Apple 1 Computer Kit that was hand built by Steve Wozniak. The
Apple 1 was sold as a motherboard (with CPU, RAM and basic textual video chips) – less
than what is considered a personal computer today.
The Present – January 2007, Steve Jobs, the CEO and Co-Founder of Apple,
announces that Apple Computer Incorporated would now be known as Apple Inc.
In June 2008, he announces that the iPhone 3G would be released in July 2008, this
newer version added support for 3G Networking and assisted GPS navigation,
among other things.

4. The Future – Apple plans on focusing on satisfying personal consumer demands rather
than merely fulfilling a demographic requirement as well as, improving performance
and stability rather than introducing new features when releasing new versions of any
product.
The iPhone- targets consumers who need to store information and communicate or
people who want entertainment on the go. Currently, the market for high-end phones
like the Apple I Phone is small.
Executive Summery

5. COMPANY PROFILE:
Apple Inc designs, manufactures and markets a range of personal
computers, mobile communication and media devices, and portable digital music
players
VisionMission
Leading
Products
“To be a leader in providing simple, powerful, high-quality information products and
services for people who learn, communicate, and create”
“Our mission is to bring the best personal computing experience to students,
educators, creative professionals and consumers around the world through its
innovative hardware, software and Internet offerings”
Mac iPod iPhone iPad
Apple
TV

6. Apple organization hierarchy:

7. Balance sheet of asset:

8. Balance sheet of Liabilities:

9. Income statement:

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11. Liquidity Ratios:
Current ratio
In 2013
Current Assets 73,286/43,658= 1.67
Current Liabilities
Interpretation:
Measures ability to meet current debts with it current assets.
In 2012 = 1.49611
=

12. In 2013
73,286- (1,764)
43,658
In 2012 = 1.24825
Current Assets - Inv
Current Liabilities
Acid-Test (Quick)
= 1.63
Interpretation:
Measures ability to meet current liabilities with most liquid
current asset.
=

13. Financial Leverage Ratios
Debt-to-Equity
In 2013
Total Debt
Shareholders’ Equity
$16,960,
= = 0.13
$123,549
Total Debt
Shareholders’ Equity
= 0.00
In 2012
Interpretation:
Indicates the extent to which debt financing is used relative
to equity financing.

14. Debt-to-Total-Assets
Total Debt
Total Assets
=
$16,960
$207,000
= o.o8
In 2012 = 0.00
In 2013
Interpretation:
Shows the relative extent to which the firm is using borrowing
money.

15. Total Capitalization
Total Debt
Total Capitalization
= $16,960,000
$140509000
In 2012 = 0.00
In 2013
= 0.12
Interpretation:
Shows the relative importance of long-term debt to the long-
term financing of the firm.

16. Coverage Ratios
Interest Coverage
EBIT
Interest Charges
$50,155
$136
= = 368.7 time
In 2012 = $55,763
In 2013
Interpretation:
Indicate ability to cover interest charges tell number of times
interest is earned.

17. Activity Ratios
Receivable Turnover
Annual Net Credit Sales
Receivables $1,949,000
= 5.5time$10,830,000
In 2012= 2.1 time
In 2013
Interpretation:
Measures how many times a receivable have been turnover
into cash during the year provide insight into quality of the
receivable.
=

18. Average Collection Period
Days in the Year
Receivable Turnover
365
=
5.5
= 66 Days
Interpretation:
Measures how many times the receivable have been
turnover into cash during the year provide insight into
quality of the receivable.
In 2013
In 2012= 173 Days

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20. Inventory Turnover
In 2013
Cost of Goods Sold
Inventory
106,606000
1,764000
= = 60
In 2012 = 50
Interpretation:
measures how many times the inventory has been turned
over (sold) during the year; provides insight into liquidity of
inventory and tendency to overstock

21. Average collection
• Collection average for 2012=7.3
• Collection average for 2013= days
inventory turnover ratio
60
Interpretation: measures relative efficiency of
total assets to generate sale
365
= 6.0

22. Total Assets Turnover Ratio
• Total assets turnover ratio for 2012 =
• Total assets turnover ratio for 2013 = net sales
total assets
20,7000
Interpretation:
measures relative efficiency of total assets to generate sale.
26.67
$170,910,00=
=52.3

23. Average collection
• Average collection for 2012 = 13.6
• Average collection for 2013 = Days
total asset turnover ratio
365
52.3
=6.97
Interpretation:
measures relative efficiency of total assets to generate sale.

24. Profitability Ratio
• Profitability ratio:
• Net profit margin for 2012 = 4.1
• Net profit margin for 2013 = Net profit after taxes
Net sales
Interpretation: : measure profitability with respect
to sales generated net income per dollar of sales
$37,037
= = 2.1
$170,91

25. Return on investment
• Return on investment in 2012= 0.2
• Return on investment in 2013= Net profit after taxes
total assets
Interpretation: measures overall effectiveness in
generating profits with which available assets earning
power of invested capital
$37,037,000
$207,000,000
=0.1
=

26. Return on Equity
• Return on equity in 2012=0.35
• Return on equity in 2013= Net profit after taxes
share holder’s equity
$37,037,000
$19,764,000
= 1.8
Interpretation:
measures earning power on shareholder’s book-value
investment.

27. Du Pont approach
• Du Pont approach for 2012 = 1o9.3
• Du Pont approach for 2013 = net profit
margin*total asset turnover ratio
3.4*52.3 = 177.82

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29. Common size Analysis:Apple Inc., Common-Size Consolidated Statement of
Financial Position, Assets
Sep 28, 2013 Sep 29, 2012 Sep 24, 2011 Sep 25, 2010 Sep 26, 2009 Sep 27, 2008
Cash and cash
equivalents 6.89% 6.10% 8.43% 14.98% 9.77% 30.01%
Short-term
marketable
securities 12.70% 10.44% 13.87% 19.10% 33.80% 31.88%
Accounts
receivable, less
allowances 6.33% 6.21% 4.61% 7.33% 6.24% 6.12%
Inventories 0.85% 0.45% 0.67% 1.40% 0.84% 1.29%
Deferred tax
assets 1.67% 1.47% 1.73% 2.18% 3.90% 3.66%
Vendor non-
trade
receivables 3.64% 4.41% 5.45% 5.87% 3.15% 5.77%
Other current
assets 3.32% 3.67% 3.89% 4.58% 9.63% 8.95%
Current assets 35.40% 32.75% 38.66% 55.44% 67.34% 87.66%
Long-term
marketable
securities 51.31% 52.32% 47.79% 33.77% 19.55% –
Property, plant
and equipment,
net 8.02% 8.78% 6.68% 6.34% 5.49% 6.20%
Goodwill 0.76% 0.64% 0.77% 0.99% 0.38% 0.52%
Acquired
intangible
assets, net 2.02% 2.40% 3.04% 0.45% 0.46% 0.72%
Other assets 2.49% 3.11% 3.06% 3.01% 6.78% 4.89%
Non-current
assets 64.60% 67.25% 61.34% 44.56% 32.66% 12.34%

30. Common size Analysis (cont):
Accounts Payable 12.57 12.03 10.81 9.18
Short-Term Debt — — — —
Taxes Payable 0.98 0.87 0.58 1.05
Accrued Liabilities 6.97 4.76 2.52 3.28
Other Short-Term Liabilities 3.52 4.23 7.19 7.47
Total Current Liabilities 24.04 21.89 21.09 20.98
Long-Term Debt — _ 8.19 8.23
Other Long-Term Liabilities 10.13 10.97 11.03 12.45
Total Liabilities 34.16 32.86 40.31 41.66
Total Stockholders' Equity 67.14 59.69 58.34 65.84
Total Liabilities & Equity 100.00 100.00 100.00 100.00
Apple Inc., Common-Size Consolidated Statement of Financial Position, liabilities
Sep 28, 2010 Sep 29, 2011 Sep 24, 2012 Sep 25, 2013

31. Index analysis
particulars Current year of
2013/base year of
2011*100
Amount Current year of 2012/
base year of 2011*100
Amount
Property, plant and
equipment of 2013, 21012/
property, plant and
equipment of 2011 *100
16,597
7,777*100
=213.41 15,452 *100
7777
=198.68
Current assets of
2013,2012/ current assets
of 2011*100
73,286
57,653*100
=127.11 44,9881,
57,653*100
=780
Total assets of 2013, 2012/
total assets of 2011*100 $207,000
116,371 *100
=177.87 1,767,168
116,371 *100
=1.518
Share capital-ordinary of
2013,2012/ share capital-
ordinary of 2011*100
61,576
61,576*100
=100 61,576
61,576*100
=100
Reserves of 2013,2012/
reserves of 2011*100
388,153
420,085*100 =92.39
534,202
420,085*100 =127.16
Non-current liabilities of
2013,2012/ non-current
liabilities of 2011*100
43,658
10,100*100
=432.25 16,664
10,100*100
=16.47
Current liabilities of
2013,2012/ current
liabilities of 2011*100
43,658
27,970*100
=156.08 38,542
27,970*100
=381.60
Total liabilities of
2013,2012/ total liabilities
of 2011*100
83,451
39,756*100
=209.90 57,854
39,756*100
=145.52
Total shareholders’
equity2013,2012/ Total
shareholders’
equity2011*100
123,549
76,615*100
=161.25 118,210
76,615*100
=154.29

32. Thanks
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