2. Group Members
Nasir Ali Khan (103137)
H.Bilal Ahmad Ch (103145)
Bilal Shamim (102119)
Waqas Hassan Khan (121812)

3. D G Khan Cement
and
Lucky Cement

4. What is Cement?
History of Cement:
old as human civilization
Romans used volcanic tuff mixed raw material for
their construction
Egyptians used it for the construction of
PYRAMIDES
Mr. Joseph patented artificial cement with a famous
building stone obtained from the land of England in
1824.

5. Introduction Of D.G Khan Cement:
 State Cement Corporation of Pakistan (S. C. C. P) was established in 1984.
 In 1977 demand is 3.7 m tons while the production is 3.1 m tons.
 Main purpose of establishment is to fulfill the demand of Northern Marketing
Zone.
 Selected a place D. G. Khan.
 The location is ideal because it is near to market as well as prior to raw
material.
 In 1992 SCCP was privatized and purchased by Nishat group of industries.
 its name changed from SCCP to D. G. Khan Cement Factory.
 The new plant is the relief for Bhawalpur, Khanewal,Muzafargurh,
Bhawalnagar, and Vehari.
 . Its design capacity of 3300 ton clinker per day.
 DGKCC has three cement plants, two plants located at Dera Ghazi Khan and
one at Khairpur Distt. Chakwal

6. Mission Statement
“D. G. Khan Cement Company committed to produce and supply high
quality conforming the local and international standards adopting
modern technique satisfying the customer requirements the most
competitive prices.”
Future Planning:
Export their high quality cement
The main purpose of ISO 9002 certificate it to get the approval from
ISO, they can export their high quality cement according to
international standards .

7. Introduction of Lucky Cement:
 Lucky Cement Limited was founded in 1994
• Lucky Cement Limited is the largest cement producer in
Pakistan
 Its shares are traded on the Karachi Stock Exchange
 Its symbol in the Karachi Stock Exchange (KSE) is 'LUCK'.
 Lucky Cement Limited has been sponsored by one of the
largest business groups in Pakistan, the Yunus Brothers
Group (YB Group),

8. Organization Structure:
 managed by the team of professionals.
 Two production plants & five marketing offices.
 1800 permanent employees throughout Pakistan.

9. Economy overview
 Per capita income rose from $1073 to $1254 increase
of 16.9%
 Rs196.3billion borrowed from state bank and Rs
275.9 billion by scheduled banks..
 Tax collected Rs 1588 billions instead of Rs 1667
billions
 This is due to floods during july and august 2011
 Inflation rate is 14.1% but in last year it was 11.5%

10.  Increase in inflation rate is attribute to increase in in
food price
 This due to increase in price of sugar milk poultry
meat etc

11. Cement sector performance
 Total sales volume increased by 2.94millions tons
 Local cement demand increased by 14.6% to
23.53million tons against 19.4million

12. Past, present and future performance of lucky
cement
 Larger manufacturer
 Signed a MoU with oracle coal for coal supply
 Implemented waste heat recovery project in karachi.
 During 2011 production of clinker and cement
increased by 7.92% and 13.05%
 Due to massive capacity expansion company has
been able to consolidate its position

13.  Local sale increased by 12.43% while export declined
by 32%
 Local Market share increased by 12.79% to 15.61%
 Export segment declined by 33% to 26.21%
Financial performance
 Inventory turnover ratio decline from 19.28 times to
12 times
 Current ratio increased .7to .81

14.  Debt to equity ratio increased 53%-55%
 Debt to assets ratio increased by 34%-36%
 Long term debt to equity decreased 14%-10%
 Earning per share shrunk from Rs7.92 to Rs 7.65
 Lucky cement profit is Rs 3.889 million
 Cost per ton decreased by 11%

15. Future outlook
 Price of cement is expected to increase
 Local cement sale can also be increased due to the
construction of 8dams in province
 Working capital ratio can easily improve

16. D G Khan Cement Present, Past & Future
Performance:
 It is a unit of Nishat group
 I t is producer and seller of ordinary portland and
sulphate resistant cement
 PAT declined by Rs388m toRs177m
 EPS decreased 1.06 - .49
 current ratio is 1.19:1

17. Future outlook
 As GDP increased in 2011 by 4.5% so its expected
higher per capita cement consumption
 The infrastructure redevelopment of flood affected
areas is also a potential area for demand of cement to
grow
 DGKC is trying to cut down the costs that have
significantly and adversely impacted its profits.
 To reduce electricity cost, DGKC has started a project
of power generation from waste heat at DGK Site

18.  DGKC has also decided to use municipal solid waste
as fuel for heating purposes.
 Beneficiary for to reduce PC help to resolve
environmental issues

19. THE HORIZONTAL ANALYSIS
OF COMPANY
H O R I Z O N T A L A N A L Y S I S O F B A L A N C E S H E E T

20. 2006 2007 2008 2009 2010 2011
Share capital & reserves 100.00 32.31 163.88 228.90 254.98 292.85
Non current Liabilities 100.00 (15.06) (33.08) (48.80) (69.73) (76.78)
Current Liabilities 100.00 33.68 61.76 91.47 102.90 125.10
Total Equity & Liabilities 100.00 8.92 44.94 62.52 62.18 74.45
HORIZONTAL ANALYSIS OF BALANCE SHEET
Lucky Cement
Non Current Assets 100.00 6.02 35.04 59.30 64.02 65.73
Current Assets 100.00 21.40 87.53 76.37 54.22 111.97
Total Assets 100.00 8.92 44.94 62.52 62.18 74.45

21. Vertical analysis of balance sheet
Lucky Cement
2006 2007 2008 2009 2010 2011
Share capital & reserves 29.92 36.35 54.49 60.56 65.50 67.39
Noncurrent Liabilities 49.96 38.96 23.06 15.74 9.33 6.65
Current Liabilities 20.12 24.49 22.45 23.70 35.17 25.96
Total Equity & Liabilities 100.00 100.00 100.00 100.00 100.00 100.00
Non Current Assets 81.14 78.98 75.60 79.53 82.06 77.08
Current Assets 18.86 21.02 24.40 20.47 17.94 22.92
Total Assets 100.00 100.00 100.00 100.00 100.00 100.00

22. Vertical analysis of Income statement
Lucky cement
2006 2007 2008 2009 2010 2011
Turnover
Cost of Sales
100.00
63.00
100.00
70.65
100.00
74.31
100.00
62.74
100.00
67.44
100.00
66.52
Gross Profit
Distribution Cost
Admin Cost
73.00
1.28
1.33
29.35
3.97
0.89
25.69
6.81
0.74
37.26
9.22
0.63
32.56
14.01
1.24
33.48
12.44
1.20
Operating Profit
Finance Cost
Other Income/Charges
43.39
1.03
1.67
24.49
6.89
(3.89)
18.14
0.75
3.79
27.41
4.70
3.05
17.31
2.32
1.04
19.84
1.99
1.24
Profit before tax
Tax
31.70
7.66
21.49
1.14
13.60
(2.19)
19.66
2.20
13.94
1.14
16.61
1.35
Profit after tax 24.04 20.34 15.79 17.46 12.80 15.26

23. D.G. Khan Cement Company
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31,….
2007 2008 2009 2010 2011
Net Sales
100.00% 100.00% 100.00% 100.00% 100.00%
Cost of Sales
68.34% 84.60% 68.50% 52.92% 74.88%
Gross Profit
31.65% 15.40% 31.50% 22.50% 25.58%
Administrative expenses
-1.62% -0.89% -0.78% -0.77% -1.54%
Selling and distribution expenses
-1.01% -4.52% -10.37% 11.81% 6.54%
Other operating expenses
-2.17% -4.67% -4.42% -2.49% -2.18%
Impairment on investments
_ _ -1.42% -0.18% -1.22%
Other operating income
7.47% 6.80% 4.27% 4.71% 5.71%
Profit from operations
34.32% 15.10% 18.78% 30.52% 41.77%
Finance cost
-7.28%
-14.05% -14.50% -6.23% -8.70%
Profit before tax
26.82%
-2.02% 4.34% 24.29%
33.07%
Taxation
-1.52% 1.58% -1.39%
-1.42% 1.73%
Net profit
25.20% -2.44% 2.92%
22.87% 31.34%

24. D.G. Khan Cement Companyh
BALANCE SHEET
AS AT DECEMBER 31,…..
2007 2008 2009 2010 2011
ASSETS
NON-CURRENT ASSETS
Property, Plant and equipment 42.74% 44.19% 56.90% 58.70% 62.40%
capital work in process 0.15% 0.11% 0.35% 0.21% 0.13%
Long term investments 15.29% 13.07% 7.42% 19.40% 13.86%
Long term loans, advances and deposits 0.38% 1.00% 0.39% 2.68% 1.55%
CURRENT ASSETS
Stores, spares and loose tools 2.89% 4.42% 6.87% 1.40% 5.45%
Stock-in trade 0.57% 0.85% 2.10% 8.19% 4.88%
Trade debts 0.57% 0.70% 1.20% 0.46% 2.68%
Investments 32.72% 29.00% 18.22% 12.80% 24.78%
Advances, deposits, and other receivables 0.57% 1.50% 2.12% 2.68% 1.90%
Cash and bank balances 0.22% 0.43% 0.57% 1.50% 0.45%
EQUITY AND LIABILITIES
CAPITAL AND RESERVES
Authorised capital 19.30% 19.20% 23.40% 20.00% 22.50%
Issued, subscribed and paid-up 4.80% 4.80% 7.10% 9.36% 8.22%
Reserves 57.20% 53.07% 40.70% 38.60% 44.80%
Accumulated profit 3.40% 0.09% 1.11% 2.55% 3.75%
Total Equity 65.40% 57.70% 48.90% 70.51% 74.80%
LIABILITIES
NON-CURRENT LIABILITIES
Long term finances 16.70% 16.10% 10.20% 12.14% 15.80%
Long term deposits 0.07% 0.14% 0.07% 1.05% 0.55%
Retirement and other benefits 0.07% 0.10% 0.18% 0.48% 0.19%
Deferred taxation 3.10% 2.50% 3.30% 2.88% 3.45%
CURRENT LIABILITIES
Trade and other payables 1.98% 2.63% 3.35% 2.98% 3.50%
Accrued markup 0.66% 0.70% 1.24% 0.88% 0.12%
Short term borrowing - secured 7.62% 14.61% 21.20% 18.60% 22.23%
Current portion of non-current liabilities 3.94% 5.16% 11.10% 8.24% 6.78%
Provision for taxation 0.06% 0.06% 0.08% 0.12% 0.15%
Total 14.58% 23.38% 37.25% 30.82% 32.78%

25. Analysis of Income statement
DGKC
 D.G Khan common size analysis of income statement
shows that it has high cost of goods sold from last
years
 Gross Profit of the Co has decreasing trend due to
high cost of goods sold.
 Operative and selling expense are minimal and
project a 31.34% net profit

26. Analysis of BALANCE SHEET
DGKC
 Increase in cash and market able securities 24.08% more
than previous two years while receivables are 1.34%
 Inventories are constant at 9.99% making current assts
37% of total assets more than last two years
 Net fixed assets are 52.85% of which 69% includes
building machinery and equipment
 Total current liabilities are 26.70% of which 19% isare
short term debts
 Long term liabilities are 9% in total less than last year
 Total equity is 59.1% of which 41% are retained earnings
and rest 17 is divided between common stcock and paid
in capital

27. Financial Ratio Analysis of D.G Khan Cement & Lucky
Cement
 Liquidity Ratios
 Current Ratio:
The purpose of using liquidity ratio is to determine the ability of the
company for paying off its short term debts. The higher value of liquidity
ratios reflects that the company is well secured in performing its
obligations of short term debts. The calculation of current ratio shows that
D.G khan cement is well secured in this region. is not so secured. So it is
therefore that the company current ratio is better in 2011.
 Quick Ratio
The purpose of using liquidity ratio is to determine the ability of the
company for paying off its short term debts. The higher value of liquidity
ratios reflects that the company is well secured in performing its
obligations of short term debts. The calculation of quick ratio shows that
Company is well secured in this region.. The Company can easily meets its
short term liabilities. Even is position with respect to Inventory Turnover is
also better.

28. Assets management ratio
Inventory Turnover:
Ratios that are typically used to analyze how well accompany uses its
assets and liabilities internally. These ratios are meaningful when
compared topers/competitors in the same industry and can identify
business that are better managed relative to the others. Also, efficiency
ratios are important because an improvement in the ratios usually
translate to improved profitability.

29. Debt Management
 Debt ratio
Debt ratio is the measure to check the equity to borrowed funds/long
term financing. The best measure is the gearing ration (The results of
the company shows that they are highly geared as the portion of their
borrowed money is very much higher than the owners equity. The other
best measure is to check, how much the profit covers its interest. The
higher t he interest cover ratio value, the more safe the company
position is. In the present case, both the companies are almost covering
its interest through its profit with the ratio of 1:1.

30. Profitability
 Return on equity
D.G Khan cement is very strong in this area and proved that the management
is well employing it Capital Employed (capital investment) generating almost
4.5 times more return than the Stock or Shares and Long-term Liabilities.
 Return on asset
D.G Khan cement is very strong in this area and proved that the
management is well employing it Return on generating almost 2.5
times more return. As compared to lucky cement

31. Net Profit Ratio:
lucky cement has generated 1.01% Net Profit as compare to previous year
whose Net Profit is 1.45%.We can drive result that lucky cement is performing
well.
Gross Profit Ratio:
Profitability ratios are the measure of assessing business performance of
generating profits with respect to its expenses and other relevant expenses
in a specific period of time say one year. The higher value as compare to the
competitors or industry average or relative to previous period show the
business is going well. In the present case, Company D.G Khan cement
generated 23.6% Gross Profit as compare to year in 2010 which Gross
Profit was 16.6% which shows that 2011 has better managed its COGS
which resulted in increase of the Gross Profit.

32. • Interest cover
Interest cover ratio is the measure to check the equity to borrowed funds/long
term financing. The best measure is the gearing ration (Debt to equity). The
results of the company shows that they are highly geared as the portion of their
borrowed money is very much higher than the owners equity. The other best
measure is to check, how much the profit covers its interest. The higher t he
interest cover ratio value, the more safe the company position is. In the present
case, both the companies are almost covering its interest through its profit with
the ratio of 1:1.
 Earning per share:
Most important is what the company is paying back to its investors/owners. The
greater value of EPS maintain the investors and owners confidence on the
company. The Company is paying almost double the value and building its better
image before the investors.
 Debt equity ratio:
Debt equity ratio is the measure to check the equity to borrowed funds/long
term financing. The best measure is the (Debt to equity). The results of both the
company shows that they are highly geared as the portion of their borrowed
money is very much higher than the owners equity. The other best measure is to
check, how much the profit covers its interest. The higher t he interest cover ratio
value, the more safe the company position is. In the present case, both the
companies are almost covering its interest through its profit with the ratio of 1:1.

33. Thank You!
He ne’er is crowned with immortality who fails to follow where airy voices lead!
- JOHN KEATS