Final Accounting Presentation

FINANCIAL & MANAGERIAL ACCOUNTING
FINANCIAL
STATEMENT
ANALYSIS
UNIVERSITY OF AGRICULTURE FAISALABAD
12/9/2018 PROJECT: PROF.AWAIS ASLAM

GROUP NO. 04
MEMBER’S DETAIL
GROUP LEADER:
Hafiz Muddasir Ahmed
S/o Nadeem Ahmed
33100-6048211-7
OTHER MEMBERS:
 Zeenat Khalid  M.Waqas Akbar  Akash Ahmad

D/o Khalid Husain S/o Akbar Ali S/o Shabeer Ahmad
33104-2364967-4 33100-6990085-1 33102-1372363-5
 Aleeha Khalid  Afra  Asad Ali

D/o Khalid Mehmood D/o M.Anwar S/o M.Arshad
33100-9709499-4 33100-5414827-6 33102-1759399-7
 Khadija Ejaz  Azka Liaqat  M.Shehroz

D/o M.Ejaz D/o Liaqat Ali Khan S/o M.Ramzan
33100-8444462-4 33100-8984662-8 33102-7344204-1
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PROJECT DESCRIPTION
This project is about to take 03 year’s financial data of companies that are mentioned in
the list of Pakistan Stock Exchange as Non-Financial Companies (2015-2017).
PROJECT TASKS
 Gather financial data of PSE non-financial listed companies from 2015 to 2017.
 Select any five companies from the same sector.
 Write Introduction, Mission & Vision Statement of selected companies.
 Calculate their financial ratio & compare them on the basis of financial ratio’s results.
 On the basis of these results describe the best & worst companies.
 Show the graphical representation of their financial ratio’s results.
 Calculate the vertical & horizontal analysis of financial statement (Balance Sheet or
Income Statement).
 Describe the short summary of complete project.
PROJECT SECTOR TEXTILE:

 Masood Textile Mills Pvt. Ltd.
 Nishat Textile Mills Pvt. Ltd.
 Crescent Textile Mills Pvt. Ltd.
 Gul Ahmad Textile Mills Pvt. Ltd.
 Koh-i-Noor Textile Mills Pvt. Ltd.
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TABLE OF CONTENTS
Contents
INTRODUCTION OF FINANCIAL STATEMENT ANALYSIS…………………………… 5
COMPANY’S VISION AND MISSION STATEMENT ....................................................................... 10

Vision Statement: ...................................................................................................................................... 10
Mission statement: .................................................................................................................................... 10
OPERATING CYCLE ............................................................................................................................. 12
LIQUIDITY RATIO ................................................................................................................................. 13
QUICK RATIO ......................................................................................................................................... 14
PROFITABILITY..................................................................................................................................... 14
ACTIVITY................................................................................................................................................. 15
FINANCIAL LEVERAGE ...................................................................................................................... 16
RETURN RATIOS ................................................................................................................................... 17
VERTICAL ANALYSIS (2015-2017) ..................................................................................................... 18
PROFIT AND LOSS ACCOUNT ........................................................................................................... 18
BALANCE SHEET ................................................................................................................................... 19
HORIZONTAL ANALYSIS .................................................................................................................... 21
Income Statement of MTM 2014-2015 .................................................................................................... 21
Income Statement for 2015-2016 ............................................................................................................. 24
Income statement of MTM for 2016-2017 .............................................................................................. 27
NISHAT MILLS LTD. ............................................................................................................................. 30
INTRODUCTION: ................................................................................................................................... 30
UNITS OF NISHAT MILLS LTD. ......................................................................................................... 31
SPINNING:................................................................................................................................................ 31
WEAVING: ............................................................................................................................................... 31
HOME TEXTILE: .................................................................................................................................... 32
GARMENTS: ............................................................................................................................................ 32
POWER GENERATION: ........................................................................................................................ 32
MISSION STATEMENT: ........................................................................................................................ 33
RATIO ANALYSIS: ................................................................................................................................. 35
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GRAPHICAL REPRESENTATION OF RATIO ANALYSIS ............................................................ 37
OPERATING CYCLE ............................................................................................................................. 37
LIQUIDITY RATIO................................................................................................................................. 38
QUICK RATIO ......................................................................................................................................... 39
PROFITABILITY..................................................................................................................................... 39
ACTIVITY................................................................................................................................................. 40
.................................................................................................................................................................... 40
RETURN RATIOS ................................................................................................................................... 42
VERTICAL ANALYSIS .......................................................................................................................... 43
KOHINOOR MILLS LIMITED ............................................................................................................. 55
INTRODUCTION: ................................................................................................................................... 56
VISION ...................................................................................................................................................... 56
MISSION ................................................................................................................................................... 56
RATIO ANALYSIS .................................................................................................................................. 57
GRAPHICAL REPRESENTATION OF RATIO ANALYSIS ............................................................ 59
OPERATING CYCLE ............................................................................................................................. 59
LIQUIDITY RATIO ................................................................................................................................. 60
QUICK RATIO ......................................................................................................................................... 61
PROFITABILITY..................................................................................................................................... 61
ACTIVITY................................................................................................................................................. 62
RETURN RATIOS ................................................................................................................................... 64
VERTICAL ANALYSIS .......................................................................................................................... 65
INTRODUCTION: ................................................................................................................................... 87
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INTRODUCTION OF FINANCIAL STATEMENT ANALYSIS
Financial statement analysis (or financial analysis) is the process of reviewing and
analyzing a company's financial statements to make better economic decisions.
These statements include the income statement, balance sheet, statement of cash flows, and
a statement of changes in equity.
06 Steps to an Effective Financial Statement Analysis:
1. Identify the industry economic characteristics.

Determine a value chain analysis for the industry—the chain of activities involved in the
creation, manufacture and distribution of the firm’s products and/or services. Techniques such as
Porter’s Five Forces or analysis of economic attributes are typically used in this step.
2. Identify company strategies.

Look at the nature of the product/service being offered by the firm, including the uniqueness of
product, level of profit margins, creation of brand loyalty and control of costs. Additionally,
factors such as supply chain integration, geographic diversification and industry diversification
should be considered.
3. Assess the quality of the firm’s financial statements.

Review the key financial statements within the context of the relevant accounting standards. In
examining balance sheet accounts, issues such as recognition, valuation and classification are
keys to proper evaluation. The main question should be whether this balance sheet is a complete
representation of the firm’s economic position. When evaluating the income statement, the main
point is to properly assess the quality of earnings as a complete representation of the firm’s
economic performance. Evaluation of the statement of cash flows helps in understanding the
impact of the firm’s liquidity position from its operations, investments and financial activities
over the period—in essence, where funds came from, where they went, and how the overall
liquidity of the firm was affected.
4. Analyze current profitability and risk.

This is the step where financial professionals can really add value in the evaluation of the firm
and its financial statements. The most common analysis tools are key financial statement ratios
relating to liquidity, asset management, profitability, debt management/coverage and risk/market
valuation. With respect to profitability, there are two broad questions to be asked: how profitable
are the operations of the firm relative to its assets—independent of how the firm finances those
assets—and how profitable is the firm from the perspective of the equity shareholders. It is also
important to learn how to disaggregate return measures into primary impact factors. Lastly, it is
critical to analyze any financial statement ratios in a comparative manner, looking at the current
ratios in relation to those from earlier periods or relative to other firms or industry averages.
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5. Prepare forecasted financial statements.
Although often challenging, financial professionals must make reasonable assumptions about the
future of the firm (and its industry) and determine how these assumptions will impact both the
cash flows and the funding. This often takes the form of pro-forma financial statements, based on
techniques such as the percent of sales approach.
6. Value the firm.

While there are many valuation approaches, the most common is a type of discounted cash flow
methodology. These cash flows could be in the form of projected dividends, or more detailed
techniques such as free cash flows to either the equity holders or on enterprise basis. Other
approaches may include using relative valuation or accounting-based measures such as economic
value added.
INTRODUCTION OF TEXTILE SECTOR

The textile industry is primarily concerned with the design, production and distribution
of yarn, cloth and clothing. The raw material may be natural or synthetic using products of
the chemical industry.
The textile sector in Pakistan contributes 57% to the country's exports. The textile industry is the
second largest employment sector in Pakistan. Pakistan is the 8th largest exporter of textile
commodities in Asia and textile sector contributes 8.5% to the GDP of Pakistan.
INDUSTRY OVERVIEW
 The textile industry is the mainstay of Pakistan’s economy.
 Cotton textiles and apparel historically were the focus of the industry, mainly because of the
large amount of cotton grown in the country. In fact, Pakistan currently ranks fourth among
world cotton producers and third among world cotton consumers.
 Cotton being the prime crop of Pakistan makes the textile industry the most significant industry
of the country.
 The spinning industry being the sole consumer of cotton worth $5 billion, sustains the largest
cash crop of the Pakistan.
 The textile industry contributes more than 60% of the export earnings of the country.
 During the 1990s, Pakistan’s textile manufacturing sector developed manifolds. Now, it
constitutes 46% of the total manufacturing, provides 38% of the manufacturing labor force,
shares 9% in GDP and also has the potential to meet the challenges of the highly competitive
global market especially after the removal of trade barriers under W.T.O. regime.
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 Hence, the country is facing much stronger competition not only from the regional competitors
(Asian—China, India, Bangladesh etc.) but from the global level competitors from American and
European textile players with the support of much advanced infrastructure and improved
systematic operations.
 Pakistan’s textile industry provides 9% of the global textile needs and ranked at world’s number
10 textile producers.
 Pakistan’s textile industry, based on locally-grown cotton, produces cotton yarn, cotton cloth,
and made-up textiles and apparel. Market for imported textile machinery and equipment in
Pakistan is directly proportional to the overall strength of the local textile industry.
 In order to revitalize this sector, the Government of Pakistan (GOP) has formulated “Textile
Vision 2007”. According to that “vision”, Government of Pakistan plans was to spend Pakistan
Rupees 331 billion (USD 1.00 equals Rs. 92 at the current exchange rate) in the textile industry
in order to attain fifth position as a leading Asian textile exporter and to increase the exports to
USD 13.815 billion by 2007.
 To achieve this goal, it is expected that new investment is more than Pak. Rupees 333 billion will
be required in different sub-sectors of textile industry. Pakistan is the eighth largest textile
exporter from Asia. This is in spite of serious problems being faced by the local textile industry.
 Operational competitiveness can be defined as the ability of firm to design, produce and or
market products superior to those offered by competitors, considering the price and non-price
qualities. For instance, the negligible local production of textile machinery mainly comprises of
spindles and ring cups for the spinning industry, power looms for the weaving industry, simple
dyeing and finishing equipment, knitting and sewing machines and accessories such as rubber
cots plastic bobbins and wire for carding machines.
 In other words, the local industry desperately requires more modern machinery and techniques to
compete in an increasingly competitive industry. In additional to the basic problems, the textile
industry is also extremely affected by the national instability due to the recent judicial, political,
economic, energy and security issues.
 Research efforts have brought many interesting perspectives and frameworks at the country’s
industry, and firm level.
China’s current progress in textiles and the continuing shift of its focus on downstream sectors
gives an opportunity to Pakistan to fill up the area in spinning and weaving being vacated by
China.
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MASOOD TEXTILE MILLS
LTD.
Page | 8
Masood Textile Mills is the only textile mill in Pakistan with latest computerized
Barcode System that assures quality in every operation of production from spinning to packing.
Products of each department carry bar coded stickers, which bear all the details and history of
the operations of that product. Hence if any problem is reported, one can trace back the root of
the problem and enable to prevent occurrence of the same in future.
VERTICALLY INTEGRATED OPERATIONS:

Besides, MTM is one of the few fully vertical textile mills in Pakistan having in-house
Yarn, Knitting, Fabric dyeing, Processing, Laundry and Apparel Manufacturing facilities. The
vertically integrated operations help us in achieving shorter lead times and greater flexibility to
cater to the customers demand.
CUSTOMER PROFILE:
MTM is proud to work with the world best labels. This exposure to the brand labels has
been a continuous learning experience for the entire team. Currently, 85% of production is
exported to the U.S. while rest 15% to Europe.
STITCHING DIVERSITY:
With over 1,749 stitching machines, MTM is producing about 120,000dozens perr month
of fashion garments like Polo, Rugby and Henley shirts along with basic garments like Crew Neck
Tee, Sweat shirt, Boxer shorts and Bikinis. MTM has in-house Embroidery facility equipped with
Tajima machines.
EXPERIENCED PROFESSIONAL MANAGEMENT:

The MTM Team comprises a balanced blend of experienced professionals including over
200 MBAs, Textile Engineers and Industrial Engineers. Continuous training and development
keeps them abreast with modern technical and management tools. MTM is WRAP certified and
ISO 9002 certified as well.
AGGRESSIVE R&D FACILITY:

A very aggressive and creative R&D department is always busy in exploring innovative
product development enabling MTM to be ahead of many in the field. Our keen, extensive and
aggressive Merchandising team comprising experienced and trained MBAs functions with the
core objective of rendering ultimate customer satisfaction through product development and
smooth execution of orders.
SOCIAL & ENVIRONMENTAL RESPONSIBILITIES:

MTM, as a corporate citizen, recognizes and believes in fulfilling its responsibility
towards the society and the environment. An effluent treatment plant is in the phase of
completion. The compliance standards of international community are fully implemented and
ensured at all times.
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COMPANY’S VISION AND MISSION STATEMENT
Vision Statement:
 A leading producer by providing the highest quality of goods and services to its
customers
 To strive excellence through commitment, integrity, honesty and teamwork
 Sustained growth in earnings in real time
Mission statement:
Our mission is to be dynamic, profitable and growth oriented company by providing good
return on investment to its shareholders and investors, quality product to its customers, a secured
and friendly environment place of work to its employees and to project Pakistan’s image in the
international market.
MASOOD TEXTILE MILLS PVT. LTD.

Financial Years
Financial Ratios
Formulas 2015 2016 2017
Operating Cycle
83.763439 96.455514 126.17212
No. of days of inventory Inventory/CGS/365 27 93 22
A/C receivables/credit 14.972310 24.592830 41.690791
No. of days of receivables sales/365 6 63 21
29.845980 31.177092 26.732470
no. of days of payables A/C payables/Purchases/365 96 04 62
Liquidity Ratios
1.1318707 1.2024803 1.5649230
Current Ratio Current assets/current liabilities 03 1 42
C.A-Inventory/current 0.7663738 0.8051149 0.9788171
Quick Ratio liabilities 45 55 83
Net working capital to 0.0705807 0.1159987 0.2849707
sale ratio C.A-C.L/Sales 67 38 76
Profitability
0.1475673 0.1385575 0.1447081
Gross profit margin Gross Income/Sales 73 55 28
0.0382732 0.0147178 0.0093204
Operating profit margin Operating Income/Sales 82 91 31
0.0279633 0.0314542 0.0379159
Net profit margin Net Income /Sales 57 01 49
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Activity
4.3575097 3.7841278 2.8928735
Inventory Turnover CGS/Inventory 1 47 89
Accounts receivable Credit Sales/Account 24.378334 14.841974 8.7549309
turnover Receivable 77 13 9
1.1739981 1.0199373 0.8697057
Total asset turnover Sales/Total Assets 68 05 58
3.4623450 2.7741353
Fixed asset turnover Sales/Fixed Assets 98 3.4297704 96
Financial leverage
0.7339086 0.6329390 0.6289718
Total debt to assets ratio Total Debt/Total Assets 27 93 32
Long-term debt to assets 0.0642207 0.0486282 0.1903177
ratio Long-term Debt/Total Assets 87 54 15
2.4644004 1.9463336 2.0028101
Total debt to equity ratio Total Debt/Shareholder equity 76 74 07
Total Assets/Shareholder 3.5583086 3.3309901 3.1842604
Equity multiplier equity 73 92 17
Time-interest-coverage
ratio EBIT/Interest 3.7122757 4.8685099 9.3531976
Fixed-charge coverage
Ratio EBIT + Lease /interest+ Lease 3.0278069 4.0261900 7.8843019
Shareholder Ratios
NI to Shareholders/Share
Earnings per Share Outstanding 11.88 11.64 12.76
Dividend/No. of share
Dividend per share outstanding 0 0 0
Dividend payout ratio Dividend/Earnings 0 0 0
Market price per share/Earning
Price Earnings Ratio Share 0 0 0
Return Ratios
Basic earning power ratio Operating Income/Total Assets 0.0449327 0.0403742 0.0369233
Return on assets Net Income /Total Assets 0.0328289 0.0320813 0.0329757
Return on Equity Net Income/Shareholder equity 0.1168154 0.1068625 0.1050032
Page | 11
OPERATING CYCLE
No. of Days inventory

150
100
50
0
2015 2016 2017
No. days of recievables

45
40
35
30
25
20
15
10
5
0
2015 2016 2017
No. of Days of payables

32
31
30
29
28
27
26
25
24
2015 2016 2017
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LIQUIDITY RATIO
Current Ratio
2
1.5
0.5
0
2015 2016 2017
1.2
0.8
0.6
0.4
0.2
0
2015 2016 2017
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QUICK RATIO
Net working capital to sale ratio

1.4
1.2
1
0.8
0.6
0.4
0.2
0
2015 2016 2017
PROFITABILITY
Gross Profit Margin

0.15
0.145
0.14
0.135
0.13
2015 2016 2017
Operating Profit Margin

0.04
0.03
0.02
0.01
0
2015 2016 2017
Page | 14
Net Profit Margin
0.04
0.035
0.03
0.025
0.02
0.015
0.01
0.005
0
Category 1 Category 2 Category 3
ACTIVITY
30
25
Inventory turnover
20
15 Account recievable
turnover
10
Total assets turnover
5
0
2015 2016 2017
Fixed Asset Ratio

4
0
2015 2016 2017
Page | 15
FINANCIAL LEVERAGE
3
2.5
2
Total debt to asset
1.5
long term debt to asset
1 total debt to equity
0.5
0
2015 2016 2017
10
9
8
7
6 equity multiplier
5
time intrest coverage
4
3 fixed charge coverage
2
1
0
2015 2016 2017
Page | 16
RETURN RATIOS
0.12
0.1
0.08 basic earning power

ratio
0.06 return on asset
0.04 return on equity
0.02
0
2015 2016 2017
Page | 17
VERTICAL ANALYSIS (2015-2017)
PROFIT AND LOSS ACCOUNT

(For the Year Ended 30th June)
2015 2016 2017
Revenues Revenue/sales*100 100 100 100
Cost Of Sales Cost Of sales/sale *100 85.24326274 86.14424449 85.52918721
Gross Profit Gross Profit/sale*100 14.75673726 13.85575551 14.47081279
Distribution Cost Distribution Cost/sale*100 5.461949409 6.021579586 61.74367428
Admin. Expenses Administration Exps/sale*100 1.770593994 2.038157766 2.054905309
Other Expenses Other Expenses/sale*100 0.202084708 0.209821776 0.0456316
7.322109149
Other Income Other Income/sale*100 0.224058982 1.471789077 0.93204307
Profit From Operations Profit from operation/sale*100 7.546168131
Finance Cost Finance Cost/sale*100 3.718839944 3.099482239 2.73863553
Profit Before Taxation Profit Before Taxation/sale*100 3.827328187 3.958503219 4.245504251
Taxation Taxation/Sale*100 1.03099244 0.813083106 0.453909391
Profit After Taxation Profit After Taxation/sale*100 2.796335747 3.145420113 3.79159486
Page | 18
BALANCE SHEET
(For the Year Ended 30th June)
2015 2016 2017

EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
AUTHORIZED SHARE CAPITAL
125000000 ordinary 125000000 ordinary Shares /Total 5.441646 5.499266 4.647080
Shares assets*100 418 53 277
60000000 preference 60000000 preference shares/total 2.611990 2.639647 2.230598
shares assets*100 28 934 533
8.053636 8.138914 6.877678
698 464 809
Issued, subscribed capital/total 4.128394 4.172108 3.668092
assets*100 298 741 887
23.97484 25.84899 27.81072
Reserves Reserves/total assets*100 497 436 702
28.10323 30.02110 31.40446
Total Equity Total Equity/total assets*100 926 311 662
Surplus On freehold Surplus on revaluation of freehold 2.639124 3.960501 3.346767
Land land/T.Asset*100 506 364 733
LIABILITIES
NON-CURRENT LIABILITIES
4.133226 4.862825 19.03177
Long term financing long term financing/total assets*100 48 416 153
Liabilities against assets to finance 0.408554 0.230828 0.084231
Liab. Against assets lease/T.Assets*100 46 413 118
Deferred Liability for gratuity/total 1.880297 2.581646 2.267358
asset*100 796 07 797
CURRENT LIABILITIES
9.599760 9.488104 7.331178
trade and other payables/total assets*100 811 515 079
0.677580 0.400522 0.471020
Accrued Mark-up Accrued mark-up/total assets*100 752 58 622
Short Term 48.07990 44.24267 33.11675
Borrowing short term borrowings//total assets*100 635 269 956
Current Portion Of current portion of non-current 3.267926 3.470490 2.551685
NON CL liabilities/T.Assets*100 34 32 756
1.210383 0.829293 0.394767
Prov. For Taxation Provision for taxation/total assets*100 236 792 611
Total Equity And Total Equity and Liabilities /total
Liabilities assets*100 100 100 100
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2015 2016 2017
ASSETS
NON-CURRENT ASSETS
Property, plant & equipment/total assets*100 28.65 29.53 31.1
Long Term Advances Long term Advances/total assets*100 0.003 0.001 0.03
Long Term Securities Long term security deposit/total assets*100 0.218 0.201 0.176
CURRENT ASSETS
Stores, spare parts and loose tools/total

Stores, Spare parts And Tools assets*100 4.397 4.208 4.878
Stock In Trade stock in trade/total assets*100 22.96 23.21 25.71
Trade Debts trade debts/total assets*100 30.09 26.69 20.88
Loans And Advances Loans and advances/total assets*100 1.372 1.337 1.317
Short Term Deposits & Short term deposits and prepayments/total

Prepayments assets*100 2.397 2.534 2.560
Other Receivables Other receivables/total assets*100 4.815 6.872 9.933
5.396 3.356
Cash & Bank Balances Cash and Bank Balances/total assets*100 5.082 5 3
Total Assets 100 100 100
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HORIZONTAL ANALYSIS
Income Statement of MTM 2014-2015
2015
Particulars Years Increase or Decrease
PERCENTAG
2014 2015 AMOUNT E
Sales 24371128 26,967,899 2,596,771 10.66%
Cost of goods sold 20,435,316 22,988,317 2,553,001 12.49%
GROSS PROFIT 3,935,812 3,979,582 43,770 1.11%
distribution cost 1,159,311 1,472,973 313,662 27.06%
administration expenses 443,232 477,492 34,260 7.73%
other operating expense 61,996 54,498 (7,498) -12.09%
Other income 45,327 60,424 15,097 33.31%
OPERATING PROFIT 2,271,273 2,035,043 (236,230) -10.40%
Finance cost 1,142,456 1,002,893 (139,563) -12.22%
PROFIT BEFORE
TAXATION 1,174,144 1,032,150 (141,994) -12.09%
taxation 235,845 278,037 42,192 17.89%
NET INCOME 938,299 754,113 (184,186) -19.63%
EARNING PER SHARE 14.95 11.88 -3.07 -20.54%
.
Page | 21
Balance Sheet of MTM (2014-2015)
2015
Years Increase or Decrease
PERCENTA
Liabilities &Owner's Equity 2014 2015 AMOUNT
GE
0.00%
125000000 ordinary Shares 1,250,000 1,250,000 -
0.00%
60000000 preference shares 600,000 600,000 -
0.00%
1,850,000 1,850,000 -
-0.52%
Issued, subscribed and paid up capital 953,333 948,333 (5,000)
13.19%
Reserves 4,865,452 5,507,259 641,807
10.94%
Total Equity 5,818,785 6,455,592 636,807
0.00%
Surplus On freehold Land 606,233 606,233 -
-37.70%
Long term financing 1,523,918 949,443 (574,475)
Liab. Against assets subject to finance
7.46%
lease 87,331 93,849 6,518
1.18%
Deferred liability for gratuity 426,889 431,923 5,034
Current Liabilities
-9.84%
Trade And Other Payables 2,445,831 2,205,160 -240671
-30.65%
Accrued mark up 224,442 155,647 -68795
11.18%
Short-term Borrowing 9,933,466 11,044,430 1110964
Current Portion of non-current
-7.42%
liabilities 810797 750675 -60122
Provision For taxation 235845 750675 514830 218.29%
Total Equity And Liabilities 15688519 15909164 220645 1.41%
Page | 22
2015
PERCENTAG
ASSETS 2014 2015 AMOUNT
E
NON CURRENT ASSETS
5,772,898 6,582,729 14.03%
Property plant and equipment 809,831
-81.33%
Long Term Advances 3,819 713 (3,106)
-1.03%
Long Term Securities 50,707 50,183 (524)
5,827,424 6,633,625 13.83%
806,201
Current Assets
1,137,030 1,010,124 -11.16%
Stores, Spare parts And Tools (126,906)
7,215,963 5,275,563 -26.89%
Stock In Trade (1,940,400)
Trade Debts 5,415,608 6,911,990 1,496,382 27.63%
315,190 -45.14%
Loans And Advances 574,559 (259,369)
Short Term Deposits &
550,694 10.75%
Prepayments 497,242 53,452
Other Receivables 1000862 1106224 105362 10.53%
162.47%
Cash & Bank Balances 444849 1167579 722,730
16,286,113 16,337,364 51251 0.31%
Total Assets 22,113,537 22,970,989 857452 3.88%
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Income Statement for 2015-2016
2016
PARTICULAR 2015 2016 AMOUNT PERCENRAGE
Sales 26,967,899 23,183,485 (3,784,414) -14.03%
Cost of goods sold 22,988,317 19,971,238 (3,017,079) -13.12%
GROSS PROFIT 3,979,582 3,212,247 (767,335) -19.28%
distribution cost 1,472,973 1,396,012 (76,961) -5.22%
adminitration exp 477,492 472,516 (4,976) -1.04%
Other income 60,424 341,212 280,788 464.70%
Finance cost 1,002,893 718,568 (284,325) -28.35%
PROFIT BEFORE TAXATION 1,032,150 917,719 (114,431) -11.09%
Income tax 278,037 188,501 (89,536) -32.20%
NET INCOME 754,113 729,218 (24,895) -3.30%
-2.02%
EARNING PER SHARE 11.88 11.64 -0.24
Page | 24
2016
Liabilities &Owner's PERCENTA

2015 2016 AMOUNT
GE
Equity
1,250,000 0.00%
1,250,000 -
125000000 ordinary Shares
600,000 0.00%
60000000 preference shares 600,000 -
1,850,000 0.00%
1,850,000 -
Issued, subscribed and paid up 948,333 0.00%

capital 948,333 -
5,507,259 6.69%
Reserves 5,875,555 368,296
6,455,592 5.71%
Total Equity 6,823,888 368,296
606,233 48.50%
Surplus On freehold Land 900,234 294,001
949,443 16.42%
Long term financing 1,105,335 155,892
Liab. Against assets subject to 93,849 -44.09%

finance lease 52,468 (41,381)
431,923 31.23%
Deferred liability for gratuity 566,816 134,893
Current Liabilities
-2.20%
-41.51%
Accrued mark up 155,647 91,040 -64607
Page | 25
-8.95%
Short-term Borrowing 11,044,430 10,056,494 -987936
Current Portion of non-current 5.09%
liabilities 750675 788853 38178
-74.89%
Provision For taxation 750675 188501 -562174
42.88%
Total Equity And Liabilities 15909164 22730304 6821140
2016
PERCENTAG
E
NON CURRENT ASSETS
6,582,729 6,713,395 1.98%
Property plant and equipment 130,666
-59.47%
Long Term Advances 713 289 (424)
-8.73%
Long Term Securities 50,183 45,802 (4,381)
6,633,625 6,759,486 1.90%
125,861
Current Assets - #DIV/0!
1,010,124 956,585 -5.30%
Stores, Spare parts And Tools (53,539)
5,275,563 5,277,633 0.04%
Stock In Trade 2,070
6,911,990 6,067,959 -12.21%
Trade Debts (844,031)
303,928 -3.57%
Loans And Advaces 315,190 (11,262)
576,012 4.60%
Prepayments 550,694 25,318
Other Recievables 1106224 1562048 455824 41.21%
5.06%
Cash & Bank Balances 1167579 1226653 59,074
16,337,364 15,970,818 -366546 -2.24%
Total Assets 22,970,989 22,730,304 -240685 -1.05%
Page | 26
Income statement of MTM for 2016-2017
2017
PERCENRAG
PARTICULAR 2016 2017 AMOUNT E
Sales 23,183,485 23,393,876 210,391 0.91%
Cost of goods sold 19,971,238 20,008,592 37,354 0.19%
GROSS PROFIT 3,212,247 3,385,284 173,037 5.39%
distribution cost 1,396,012 1,478,067 82,055 5.88%
administration exp 472,516 480,722 8,206 1.74%
Other income 341,212 218,041 (123,171) -36.10%
Finance cost 718,568 640,673 (77,895) -10.84%
PROFIT BEFORE
TAXATION 917,719 993,188 75,469 8.22%
Income tax 188,501 106,187 (82,314) -43.67%
NET INCOME 729,218 887,001 157,783 21.64%
EARNING PER SHARE 11.64 12.76 1.12 9.62%
Page | 27
2017
PERCENTA
Liabilities &Owner's Equity 2016 2017 AMOUNT
GE
0.00%
125000000 ordinary Shares 1,250,000 1,250,000 -
0.00%
60000000 preference shares 600,000 600,000 -
0.00%
1,850,000 1,850,000 -
Issued, subscribed and paid up
4.04%
capital 948,333 986,666 38,333
26.98%
Reserves 5,875,555 7,460,699 1,585,144
23.79%
Total Equity 6,823,888 8,447,365 1,623,477
0.01%
Surplus On freehold Land 900,234 900,324 90
363.14%
Long term financing 1,105,335 5,119,282 4,013,947
Liab. Against assets subject to
-56.82%
finance lease 52,468 22,657 (29,811)
7.60%
Deferred liability for gratuity 566,816 609,888 43,072
Current Liabilities
-8.56%
39.17%
Accrued mark up 91,040 126,698 35658
-11.42%
Current Portion of non-current
-12.92%
liabilities 788853 686968 -101885
Provision For taxation 188501 106187 -82314 -43.67%
Total Equity And Liabilities 22730304 26898610 4168306 18.34%
Page | 28
2017
PERCENTAG
E
NON CURRENT ASSETS
6,713,395 24.79%
Property plant and equipment 8,377,317 1,663,922
2719.72%
Long Term Advances 289 8,149 7,860
3.46%
Long Term Securities 45,802 47,387 1,585
6,759,486 24.76%
8,432,853 1,673,367
#DIV/0!
Current Assets -
37.18%
Stores, Spare parts And Tools 956,585 1,312,255 355,670
5,277,633 68.95%
Stock In Trade 8,916,511 3,638,878
6,067,959 -7.40%
Trade Debts 5,618,714 (449,245)
16.65%
Loans And Advances 303,928 354,523 50,595
19.59%
Prepayments 576,012 688,858 112,846
-26.40%
Cash & Bank Balances 1226653 902,816 (323,837)
15,970,818 18,465,757 2494939 15.62%
Total Assets 22,730,304 26,898,610 4168306 18.34%
Page | 29
NISHAT MILLS LTD.
INTRODUCTION:
Nishat Mills Limited is the flagship company of Nishat Group. It was established in 1951. It is
one of the most modern, largest vertically integrated textile companies in Pakistan. Nishat Mills
Limited has 227,640 spindles, 805 Toyota air jet looms. The Company also has the most modern
textile dyeing and processing units, 2 stitching units for home textile, two stitching units for
garments and Power Generation facilities with a capacity of 120 MW.
The Company’s total export for the year 2016 was Rs. 35.931 billion (US$ 344.744 million).
Due to the application of prudent management policies, consolidation of operations, a strong
balance sheet and an effective marketing strategy, the growth trend is expected to continue in the
years to come. The Company's production facilities comprise of spinning, weaving, processing,
stitching and power generation.
Page | 30
UNITS OF NISHAT MILLS LTD.
SPINNING:
WEAVING:
PROCESSING:
Page | 31
HOME TEXTILE:
GARMENTS:
POWER GENERATION:
Page | 32
Location Generation Diesel/Furnace Gas Engines Gas/Steam
Capacity Oil Engines Turbines
(MW)
Faisalabad 37.37 2 6 -
Bhikki 14.71 3 4 1
Lahore 27.04 9 9 3
Ferozewatwan 9.70 4 4 -
VISION STATEMENT:
To transform the Company into a modern and dynamic yarn, cloth and processed cloth and
finished product manufacturing Company that is fully equipped to play a meaningful role on
sustainable basis in the economy of Pakistan. To transform the Company into a modern and
dynamic power generating Company that is fully equipped to play a meaningful role on
sustainable basis in the economy of Pakistan.
MISSION STATEMENT:
To provide quality products to customers and explore new markets to promote/expand sales of
the Company through good governance and foster a sound and dynamic team, so as to achieve
optimum prices of products of the Company for sustainable and equitable growth and prosperity
of the Company.
Page | 33
Page | 34
RATIO ANALYSIS:
Ratio analysis is a shortcut method of expressing relationships among various items on the
financial statements. However, ratios are not substitutes for looking deeper into the financial
position of company. In the analysis of Nishat Textile Mills we found the following ratios:
 Net profit ratio

 Current ratio
 Earnings per share ratio
 Loan on assets ratio
 Account receivable turnover ratio
 Return on equity capital
 Operating ratio
 Operating profit ratio
 Total assets turnover ratio
 Debt ratio
 Debt on asset ratio
 Operating expenses ratio
 Return on total assets
Page | 35
NISHAT TEXTILE MILLS LIMITED
Financial Years
Financial Ratios Formulas 2015 2016 2017
Operating Cycle
8366.63 8880.03 10115.25
No. of days of inventory Inventory/CGS/365 % % %
1159.16 1458.30
No. of days of receivables A/C receivables/credit sales/365 % % 1810.87%
4147.92 3279.90
no. of days of payables A/C payables/Purchases/365 % % 5432.16%
Liquidity Ratios
Current Ratio Current assets/current liabilities 126.21% 165.04% 148.39%
Quick Ratio C.A-Inventory/current liabilities 72.21% 102.03% 87.16%
Net working capital to sale
ratio C.A-C.L/Sales 9.81% 20.58% 18.34%
Profitability
Gross profit margin Gross Income/Sales 11.77% 18.05% 16.25%
Operating profit margin Operating Income/Sales 119.87% 11.98% 10.05%
Net profit margin Net Income /Sales 7.64% 10.75% 9.94%
Activity
Inventory Turnover CGS/Inventory 436.26% 411.03% 360.84%
3148.84 2502.92
Accounts receivable turnover Credit Sales/Account Receivable % % 2015.61%
Total asset turnover Sales/Total Assets 50.60% 56.06% 55.89%
Fixed asset turnover Sales/Fixed Assets 346.23% 342.98% 277.41%
Financial leverage
Total debt to assets ratio Total Debt/Total Assets 5.52% 9.38% 7.69%
Long-term debt to assets ratio Long-term Debt/Total Assets 5.52% 9.38% 7.69%
Total debt to equity ratio Total Debt/Shareholder equity 7.33% 13.10% 11.06%
Equity multiplier Total Assets/Shareholder equity 132.83% 139.72% 143.82%
Time-interest-coverage ratio EBIT/Interest 0.00% 0.00% 0.00%
Fixed-charge coverage Ratio EBIT+Lease/interest Lease 0.00% 0.00% 0.00%
Shareholder Ratios
Earnings per Share Outstanding 0.00% 0.00% 0.00%
Dividend per share Dividend/No. of share outstanding 0.00% 0.00% 0.00%
Dividend payout ratio Dividend/Earnings 0.00% 0.00% 0.00%
Price Earnings Ratio Share 0.00% 0.00% 0.00%
Return Ratios
Basic earning power ratio Operating Income/Total Assets 6.07% 6.72% 5.62%
Return on assets Net Income /Total Assets 3.87% 6.03% 7.99%
Page | 36
Return on Equity Net Income/Shareholder equity 5.14% 8.42% 7.99%
GRAPHICAL REPRESENTATION OF RATIO ANALYSIS
OPERATING CYCLE

12000
10000
8000
6000
4000
2000
0
2015 2016 2017

2000
1800
1600
1400
1200
1000
800
600
400
200
0
2015 2016 2017
Page | 37
5000
4000
3000
2000
1000
0
2015 2016 2017
LIQUIDITY RATIO
Current Ratio
200
150
100
50
0
2015 2016 2017
120
100
80
60
40
20
0
2015 2016 2017
Page | 38
QUICK RATIO

25
20
15
10
5
0
2015 2016 2017
PROFITABILITY
Gross Profit Margin

20
15
10
0
2015 2016 2017

140
120
100
80
60
40
20
0
2015 2016 2017
Page | 39
Net Profit Margin
12
10
8
6
4
2
0
2015 2016 2017
ACTIVITY
3500
3000
2500 Inventory turnover
2000
Account recievable
1500
turnover
1000
500
0
2015 2016 2017
Fixed Asset Ratio

400
300
200
100
0
2015 2016 2017
Page | 40
FINANCIAL LEVERAGE
14
12
10
8 Total debt to asset
6 long term debt to asset

total debt to equity
4
0
2015 2016 2017
160
140
120
100
equity multiplier
80
60
fixed charge coverage
40
20
0
2015 2016 2017
Page | 41
RETURN RATIOS
0.12
0.1

ratio
0.02
0
2015 2016 2017
Page | 42
VERTICAL ANALYSIS
Income Statement for Nishat Textile Mills From 2015-2017
2015 2016 2017

Revenues Revenue/sales*100 100 100 100
Cost Of Sales Cost Of sales/sale *100 88.22895035 81.9485951 83.75003913
Gross Profit Gross Profit/sale*100 11.77104965 18.0514049 16.24996087
Distribution
Cost Distribution Cost/sale*100 4.74093371 5.69953726 6.529613741
Admin. Administration
Expenses Exps/sale*100 2.152618519 2.411919342 2.336524697
Other
Expenses Other Expenses/sale*100 0.715434418 0.459529032 0.275365348
4.162063007 9.489034305 7.108457087
Other Income Other Income/sale*100 7.825018758 2.492856195 2.946466745
Profit From Profit from
Operations operation/sale*100 99.17183269 11.9818905 10.05492383
Share of profit share of profit/sale *100 - 5.133263592 4.101149043
Finance Cost Finance Cost/sale*100 3.409252845 2.785211838 2.227301233
Profit Before Profit Before
Taxation Taxation/sale*100 8.577828919 14.32994225 11.92877164
Taxation Taxation/Sale*100 0.934002796 3.580915472 1.991738555
Profit After Profit After
Taxation Taxation/sale*100 7.643826123 10.74902678 9.937033088
Page | 43
NISHAT TEXTILE MILLS 2015-2017
BALACE SHEET AS
EQUITY AND LIABILITIES 2015 2016 2017

1100000000 share@ 1100000000 share@ 10/Total 10.87601 8.8540547 8.05461
10 assets*100 345 12 4504
Issued, subscribed Issued, subscribed capital/total 3.476368 2.8300770 2.57454
capital assets*100 4 47 6958
Equity attributes to Equity attributes to holder/total 66.740265 64.5446
holder assets*100 - 06 7067
non-controlling non-controlling interest/total 4.8307617 4.98540
interest assets*100 - 87 0718
71.80821 63.910188 61.9701
Reserves Reserves/total assets*100 04 01 2371
5.519299 71.571026 69.5300
Total Equity Total Equity/total assets*100 98 84 7138
LIABILITIES
long term financing/total 5.519299 9.2462329 7.57081
Long term financing assets*100 98 92 7745
0.0022022 0.00638
retirement obligation retirement obligation/T.A*100 0 45 438
0.0043312 0.00237
deferred liability deferred liability/total assets*100 0 43 3182
0.1298189 0.12267
long term deposits long term deposits/total assets*100 0 55 1779
Deferred Income tax Deferred Liability for 0.244672 1.3088192 1.58334
liability gratuity/total asset*100 731 46 7562
CURRENT LIABILITIES
trade and other trade and other payables/total 4.803554 5.1324451 5.03528
payables assets*100 479 88 2946
Accrued mark-up/total 0.218898 0.2490420 0.21669
Accrued Mark-up assets*100 556 21 3294
Short Term short term borrowings//total 11.39424 8.4320036 12.0789
Borrowing assets*100 857 57 7084
Current Portion Of current portion of non-current 1.763150 2.8175340 2.82559
NON CL liabilities/T.Assets*100 089 71 3183
Provision for taxation/total 0.771596 1.1065435 1.02779
Prov. For Taxation assets*100 797 37 3707
Total Equity and Liabilities /total

Total Equity And assets*10
Liabilities 100 100 100
Page | 44
2015 2016 2017
ASSETS
NON-CURRENT ASSETS
Property, plant & Property, plant & equipment/total 240.2097 30.66496 30.1178
equipment assets*100 535 003 0943
4.726252 0.380535 0.34115
Investment investment/total assets*100 465 198 7976
512.4305
properties long properties long/total assets*100 128 - -
0.019705 0.01279
Intangible assets Intangible assets/total assets*100 - 101 8782
0.929822 39.46079 37.7971
term investment term investment/assets*100 485 692 426
0.575019 0.094158 0.14091
Long Term loans Long term loans/total assets*100 724 042 3284
0.105906 0.15467
long term deposits long term deposits/total assets*100 - 568 7888
CURRENT ASSETS
Stores, Spare parts And Stores, spare parts and loose 13.17320 1.471341 2.05853
Tools tools/total assets*100 513 86 9796
102.0729 11.17651 12.9708
Stock In Trade stock in trade/total assets*100 093 512 3414
29.72846 7.509553 9.04294
Trade Debts trade debts/total assets*100 154 626 4261
Loans and advances/total 54.98296 2.552371 2.11522
Loans And Advances assets*100 844 231 0118
Short Term Deposits & Short term deposits and 0.442297 0.168403 0.18621
Prepayments prepayments/total assets*100 83 316 6097
16.02841 2.239738 2.77263
Other Receivables Other receivables/total assets*100 223 583 7754
0.025049 0.012687 0.00092
Accrued interest Accrued interest/total assets*100 31 055 8477
short term 21.59625 1.662322 1.85693
Short term Investment investment/T.Assets*100 247 21 4992
Cash and Bank Balances/total 0.514980 2.481005 0.43049
Cash & Bank Balances assets*100 276 135 4981
Page | 45
HORIZONTAL ANALYSIS
Income Statement of Nishat 2014-2015
2015
PERCENT
2014 2015 AMOUNT AGE
Sales 54,444,091.00 51,177,577 (3,266,514) -6.00%
GROSS PROFIT 7,863,774 6,024,138 (1,839,636) -23.39%
distribution cost 2,554,627 2,426,295 (128,332) -5.02%
administration expenses 1,032,238 1,101,658 69,420 6.73%
other operating expense 344,516 366,142 21,626 6.28%
Other income 3,653,041 4,004,655 351,614 9.63%
OPERATING PROFIT 7,585,434 6,134,698 (1,450,736) -19.13%
Finance cost 1,609,882 1,744,773 134,891 8.38%

PROFIT BEFORE
TAXATION 5,975,552 4,389,925 (1,585,627) -26.54%
taxation 463,000 478,000 15,000 3.24%
NET INCOME 5,512,552 3,911,925 (1,600,627) -29.04%

Page | 46
2016
PARTICULAR Years Increase or Decrease
PERCENR
Sales 51,177,577 69,645,654 18,468,077 36.09%
GROSS PROFIT 6,024,138 12,572,019 6,547,881 108.69%
distribution cost 2,426,295 3,963,480 1,537,185 63.36%
administration exp 1,101,658 1,679,797 578,139 52.48%
Other income 4,004,655 1,736,166 (2,268,489) -56.65%
OPERATING PROFIT 6,134,698 8,344,866 2,210,168 36.03%
Finance cost 1,744,773 1,939,779 195,006 11.18%

Share of profit from
associated companies - 3,575,095 3,575,095 0.00%
PROFIT BEFORE
TAXATION 4,389,925 9,980,182 5,590,257 127.34%
Income tax 478,000 2,493,952 2,015,952 421.75%
NET INCOME 3,911,925 7,486,230 3,574,305 91.37%

Page | 47
2017
PARTICULAR Years Increase or Decrease
PERCENR
Sales 69,645,654 76,321,513 6,675,859 9.59%
GROSS PROFIT 12,572,019 12,402,216 (169,803) -1.35%
distribution cost 3,963,480 4,983,500 1,020,020 25.74%
administration expenses 1,679,797 1,783,271 103,474 6.16%
Other income 1,736,166 2,248,788 512,622 29.53%
Finance cost 1,939,779 1,699,910 (239,869) -12.37%

Share of profit from
associated companies 3,575,095 3,130,059 (445,036) 0.00%
PROFIT BEFORE
TAXATION 9,980,182 9,104,219 (875,963) -8.78%
Income tax 2,493,952 1,520,125 (973,827) -39.05%
NET INCOME 7,486,230 7,584,094 97,864 1.31%

Page | 48
HORIZENTAL ANALYSES OF BALANCE SHEET of
Nishat 2014-2015
2015
Liabilities &Owner's PERCENT
Equity 2014 2015 AMOUNT
AGE
0.00%
1100000000 ordinary Shares 1,100,000 1,100,000 -
Issued, subscribed and paid
0.00%
up capital 3,515,999 3,515,999 -
11.61%
Reserves 65,073,177 72,626,824 7,553,647
11.01%
Total Equity 68,589,176 76,142,823 7,553,647
LIABILITIES
-13.20%
Long term financing 6,431,304 5,582,220 (849,084)
Deferred Income Tax
-47.89%
Liability 474,878 247,462 (227,416)
Current Liabilities
9.69%
Trade And Other Payables 4,428,996 4,858,315 429319
-24.96%
Accrued mark up 295,054 221,394 -73660
-20.35%
Current Portion of non-
11.76%
current liabilities 1595652 1783250 187598
Total Equity And
-89.55%
Liabilities 97048577 10140000 -86908577
Page | 49
2015
PERCENT
AGE
NON CURRENT ASSETS
Property plant and
960.65%
equipment 2,296,438 24,357,269 22,060,831
1139.18%
Investment 38,674 479,242 440,568
1060.56%
Properties Long 4,477,171 51,960,454 47,483,283
817.87%
Term Investment 10,272 94,284 84,012
1114.73%
Long Term Loans 4,800 58,307 53,507
1027.08%
Long Term deposits 6,827,358 76,949,556 70,122,198
Current Assets
Stores, Spare parts And
1.46%
Tools 1,316,479 1,335,763 19,284
-18.84%
Stock In Trade 12,752,495 10,350,193 (2,402,302)
2.92%
Trade Debts 2,929,054 3,014,466 85,412
33.24%
Loans And Advances 4,184,485 5,575,273 1,390,788
4.56%
Prepayments 42,893 44,849 1,956
Accrued Interest 15172 2540 -12632 -83.26%
Short Term Investment 3227560 2189860 -1037700 -32.15%
Cash & Bank Balances 2802316 52219 -2750097 -98.14%
4.22%
Total Assets 97,048,577 101,140,000 4091423
Page | 50
HORIZENTAL ANALYSES OF BALANCE SHEET of Nishat
2015-2016
2016
AGE
1100000000 ordinary
0.00%
Shares 1,100,000 1,100,000 -
0.00%
up capital 3,515,999 3,515,999 -
9.33%
Reserves 72,626,824 79,400,014 6,773,190
- #VALUE! #VALUE!
Non-controlling interest 6,001,587
16.78%
Total Equity 76,142,823 88,917,600 12,774,777
#DIV/0!
LIABILITIES -
105.78%
Long term financing 5,582,220 11,487,230 5,905,010
#DIV/0!
Long term security deposit - 161,283 161,283
Retirement benefit
#DIV/0!
obligation - 5,381 5,381
#DIV/0!
Deferred Liability - 2,736 2,736
Deferred Income Tax
557.09%
Liability 247,462 1,626,036 1,378,574
Current Liabilities
31.26%
39.75%
Accrued mark up 221,394 309,402 88008
-9.10%
96.29%
Total Equity And
1125.22%
Liabilities 10140000 124236865 114096865
Page | 51
2016
PERCENT
AGE
NON CURRENT ASSETS
Property plant and
56.41%
equipment 24,357,269 38,097,185 13,739,916
-1.35%
Investment 479,242 472,765 (6,477)
-100.00%
Long properties 51,960,454 - (51,960,454)
#DIV/0!
Intangible Assets - 24,481 24,481
51897.01%
Term Investment 94,284 49,024,857 48,930,573
100.63%
Long Term Loans 58,307 116,979 58,672
-99.83%
Long Term deposits 76,949,556 131,575 (76,817,981)
Current Assets
36.85%
Tools 1,335,763 1,827,949 492,186
34.16%
Stock In Trade 10,350,193 13,885,352 3,535,159
209.50%
Trade Debts 3,014,466 9,329,634 6,315,168
-43.12%
Loans And Advances 5,575,273 3,170,986 (2,404,287)
366.50%
Prepayments 44,849 209,219 164,370
Accrued Interest 2540 15762 13222 520.55%
Short Term Investment 2189860 2065217 -124643 -5.69%
Cash & Bank Balances 52219 3082323 3030104 5802.68%
22.84%
Total Assets 101,140,000 124,236,865 23096865
Page | 52
HORIZENTAL ANALYSES OF BALANCE SHEET of Nishat
2015-2016
2017
AGE
1100000000 ordinary
0.00%
Shares 1,100,000 1,100,000 -
0.00%
up capital 3,515,999 3,515,999 -
6.59%
Reserves 79,400,014 84,631,159 5,231,145
13.44%
Non-controlling interest 6,001,587 6,808,446 806,859
6.79%
Total Equity 88,917,600 94,955,604 6,038,004
LIABILITIES
-9.99%
Long term financing 11,487,230 10,339,290 (1,147,940)
3.87%
Long term security deposit 161,283 167,530 6,247
Retirement benefit
62.03%
obligation 5,381 8,719 3,338
18.46%
Deferred Liability 2,736 3,241 505
Deferred Income Tax
32.98%
Liability 1,626,036 2,162,341 536,305
Current Liabilities
7.83%
-4.35%
Accrued mark up 309,402 295,933 -13469
57.47%
Short-term Borrowing 10,475,657 16,495,970 6020313
10.24%
Total Equity And
9.93%
Liabilities 124236865 136567678 12330813
Page | 53
2017
PERCENT
AGE
NON CURRENT ASSETS
Property plant and
7.96%
equipment 38,097,185 41,131,193 3,034,008
-1.23%
Investment 472,765 466,935 (5,830)
-28.60%
Intangible Assets 24,481 17,479 (7,002)
5.29%
Term Investment 49,024,857 51,618,680 2,593,823
64.51%
Long Term Loans 116,979 192,442 75,463
60.55%
Long Term deposits 131,575 211,240 79,665
Current Assets
53.80%
Tools 1,827,949 2,811,300 983,351
-98.77%
Stock In Trade 13,885,352 171,367 (13,713,985)
32.37%
Trade Debts 9,329,634 12,349,739 3,020,105
-8.90%
Loans And Advances 3,170,986 2,888,707 (282,279)
1115.62%
Prepayments 209,219 2,543,311 2,334,092
Other receivables 2782581 3786527 1003946 36.08%
Accrued Interest 15762 1268 -14494 -91.96%
Short Term Investment 2065217 2535973 470756 22.79%
Cash & Bank Balances 3082323 587917 -2494406 -80.93%
9.93%
Total Assets 124,236,865 136,567,678 12330813
Page | 54
KOHINOOR MILLS
LIMITED
Page | 55
INTRODUCTION:
Kohinoor Textile Mills Limited forms one half of the illustrious Kohinoor
Maple Leaf Group. The company is listed on the KSE with a whopping market capitalization of
Rs10.3 billion. The company has come a long way since its establishment in Rawalpindi in 1953.
Initially, its Rawalpindi unit comprised of 25,000 spindles. But since then, the company has
added fabric processing facilities and additional production facilities. Today, Kohinoor Textile
Mills boasts over 156,000 ring spindles and over 200 looms at its rewind weaving facility.
Kohinoor has two spinning divisions located in Rawalpindi and Gujarkhan. It is a leading
consumer of American Pima cotton - one of the world's finest quality cotton. It is a member of
the Supima Association of America and all its products bear the demand and has also captured an
international market consisting of South East Asia, Hong Kong, Japan, Europe, USA, and
Australia. With its spinning, weaving, dyeing and printing, and stitching divisions, Kohinoor
Textile Mills has all the makings of a frontrunner in Pakistan's textile industry.
The company said in its half-yearly report that its new shed of 48 looms has been made
operational, which will increase production capacity. It also said that it is exploring alternative
energy sources to deal with the energy crisis.

VISION
"To transform the Company into a modern and dynamic Yarn manufacturing Company and to
provide quality products to customers and explore new markets to promote / expand sales of the
Company through Good Governance and foster a sound and dynamic team, so as to achieve
optimum profitability for the Company for sustainable and equitable growth and prosperity of
the Company."
MISSION
"To accomplish, build up and sustain a good reputation of the project in textile sector locally and
globally by marketing high quality of yarn through team work by means of honesty, integrity and
commitment."
Page | 56
RATIO ANALYSIS
Ratio analysis is a shortcut method of expressing relationships among various items on the
financial statements. However, ratios are not substitutes for looking deeper into the financial
position of company. In the analysis of Kohinoor Mills Limited we found the following ratios:
 Net profit ratio

 Current ratio
 Earnings per share ratio
 Loan on assets ratio
 Account receivable turnover ratio
 Return on equity capital
 Operating ratio
 Operating profit ratio
 Total assets turnover ratio
 Debt ratio
 Debt on asset ratio
 Operating expenses ratio
 Return on total assets
Page | 57
KOHINOOR TEXTILE MILLS LIMITED
Financial Years
Financial Ratios
2015 2016 2017
Operating Cycle
No. of days of inventory 58.34 59.13 50.25
No. of days of receivables 0.64 0.62 0.6
no. of days of payables 0.6 0.62 0.8
Liquidity Ratios
Current Ratio 1.06 0.76 0.78
Quick Ratio 0.66 0.39 0.42
Net working capital to sale ratio 0.62 0.61 0.65
Profitability
Gross profit margin 16.43 16.29 13.56
Net profit margin 1.56 1.39 1.26
Activity
Inventory Turnover 58.34 59.13 50.25
Accounts receivable turnover 0.74 0.62 0.6
Total asset turnover 1.28 1.35 1.63
Fixed asset turnover 2.14 2.37 2.96
Financial leverage
Total debt to equity ratio 67.33 68.32 68.32
Equity multiplier 2.48 2.66 2.76
Time-interest-coverage ratio 0.38 0.02 0.02
Shareholder Ratios
Earnings per Share 4.7 3.98 4.59
Dividend payout ratio 0.8 0.9 1.1
Price Earnings Ratio 7.16 8.65 18.16
Return Ratios
Basic earning power ratio 0.024 0.089 0.014
Return on assets 3.11 3.16 3.63
Return on Equity 0.14 0.14 0.13
Page | 58
GRAPHICAL REPRESENTATION OF RATIO ANALYSIS
OPERATING CYCLE

60
55
50
45
2015 2016 2017

0.65
0.64
0.63
0.62
0.61
0.6
0.59
0.58
2015 2016 2017
Page | 59
1
0.8
0.6
0.4
0.2
0
2015 2016 2017
LIQUIDITY RATIO
Current Ratio
1.2
1
0.8
0.6
0.4
0.2
0
2015 2016 2017
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
2015 2016 2017
Page | 60
QUICK RATIO

0.66
0.65
0.64
0.63
0.62
0.61
0.6
0.59
2015 2016 2017
PROFITABILITY
Gross Profit Margin

20
15
10
0
2015 2016 2017
Net Profit Margin

12
10
8
6
4
2
0
2015 2016 2017
Page | 61
ACTIVITY
70
60
50 Inventory turnover
40
Account recievable
30 turnover
20 Total assets turnover
10
0
2015 2016 2017
Fixed Asset Ratio

4
0
2015 2016 2017
Page | 62
FINANCIAL LEVERAGE
80
70
60
50
Total debt to asset
40
20
10
0
2015 2016 2017
2.5
2
equity multiplier
1.5
0.5
0
2015 2016 2017
Page | 63
RETURN RATIOS
3.5
3
basic earning power
2.5
ratio
2 return on asset
1.5
return on equity
1
0.5
0
2015 2016 2017
Page | 64
VERTICAL ANALYSIS
Income Statement
2015 2016
Revenues Revenue/sales*100 100 100
46.81626 198.5472
other operating incomes Cost Of sales/sale *100 376 699
146.8162 298.5472
638 699
Operating expenses
67.68871 22.64864
Admin. Expenses Administration Exps/sale*100 524 606
Other Expenses Other Expenses/sale*100 0 0
0.137568 0.054178
Finance Cost Finance Cost/sale*100 711 413
48.09117 7.687109
Share from Associates Share from Associates/sales*100 932 284
30.89880 268.1573
Profit Before Taxation Profit Before Taxation/sale*100 049 361
22.88060
Taxation Taxation/Sale*100 15 69
15.89880 245.2767
Profit After Taxation Profit After Taxation/sale*100 049 292
Page | 65
Balance Sheet
2015 2016
53.17627 49.57372
40000000 ordinary shares 125000000 ordinary Shares /Total assets*100 395 275
40.28440 37.18344
issued ,subscribed capital Issued, subscribed capital/total assets*100 82 371
24.91238 23.22463
Reserves Reserves/total assets*100 707 907
111.3116 94.14775
inappropriate profit/loss inappropriate profit/loss/total assets *100 065 771
461.1556 33.36787
Total Equity Total Equity/total assets*100 294 201
Surplus on revaluation of freehold 8.657639 80.40308
Surplus On freehold Land land/T.Asset*100 398 429
LIABILITIES
CURRENT LIABILITIES
4.940239 3.865021
trade and other payables trade and other payables/total assets*100 898 119
51.87765 46.05019
Short Term Borrowing short term borrowings//total assets*100 164 579
Current Portion Of NON current portion of non-current 0.114959 0.107171
CL liabilities/T.Assets*100 394 2
2.602467 2.942399
Prov. For Taxation Provision for taxation/total assets*100 852 607
Total Equity And Total Equity and Liabilities /total
Liabilities assets*100 100 100
Page | 66
2015 2016
ASSETS
NON-CURRENT ASSETS
Property, plant & 96.99736 0.490920
equipment Property, plant & equipment/total assets*100 473 397
Govt. taken over concerns Govt. taken over concerns/total assets*100 - -
94.76714
Investment Property Investment Property/total assets*100 - 68
0.049038 0.045716
Long Term deposits Long term deposits/total assets*100 628 391
1.190962 2.526233
Long Term investment Long term investment/total assets*100 419 534
CURRENT ASSETS
0.010174 0.007936
Loans And Advances Loans and advances/total assets*100 748 257
Trade ,deposits and Trade ,deposits and prepayments/total 0.078980 0.073629
prepayments assets*100 061 372
0.002658 0.022556
Other receivables Other receivables/total assets*100 814 044
1.316340 1.784689
Tax refunds tax refunds/total assets*100 375 712
0.354480 0.281171
Cash & Bank Balances Cash and Bank Balances/total assets*100 221 497
Total Assets 100 100
Page | 67
HORIZONTAL ANALYSIS
HORIZENTAL ANALYSES OF income statement of Kohinoor 2014-2015
2015
PERCENT
Sales 33400709 26,684,120 (6,716,589) -20.11%
other operating incomes 3,713,724 12,492,508 8,778,784 236.39%
37,114,433 39,176,628 2,062,195 5.56%
Admin Expenses 20,245,986 18,062,138 (2,183,848) -10.79%
Other operating charges 30,397,482 - (30,397,482) -100.00%
Finance cost 11,904 36,709 24,805 208.38%
Share From Associates 9,949,158 12,832,708 2,883,550 28.98%

PROFIT BEFORE
TAXATION 23,490,097 8,245,073 (15,245,024) -64.90%
Taxation 5,010,106 4,002,618 (1,007,488) -20.11%
NET INCOME 18,479,991 4,242,455 (14,237,536) -77.04%

Page | 68
HORIZENTAL ANALYSES OF income statement of Kohinoor 2015-2016
2016
PERCENT
Sales 26,684,120 29,572,664 2,888,544 10.82%
other operating incomes 12,492,508 58,715,717 46,223,209 370.01%
39,176,628 88,288,381 49,111,753 125.36%
Admin Expenses 18,062,138 6,697,808 (11,364,330) -62.92%
Other operating charges - - - -
Finance cost 36,709 16,022 (20,687) -56.35%
Share From Associates 12,832,708 2,273,283 (10,559,425) -82.29%

PROFIT BEFORE
TAXATION 8,245,073 79,301,268 71,056,195 861.80%
Taxation 4,002,618 6,766,405 2,763,787 69.05%
NET INCOME 4,242,455 72,534,863 68,292,408 1609.74%

Page | 69
2015
GE
0.00%
40000000 ordinary Shares 400,000,000 400,000,000 -
0.00%
up capital 303,025,430 303,025,430 -
0.00%
Reserves 187,394,755 187,394,755 -
unappropriate loss/profit 844,332,365 837,302,791

-1.99%
Total Equity 353,912,180 346,882,606 (7,029,574)
-0.43%
Surplus On freehold Land 654,051,196 651,264,077 (2,787,119)
Current Liabilities
-1.07%
-4.59%
Current Portion of non
0.00%
Total Equity And
-1.43%
Liabilities 763131246 752215171 -10916075
2015
PERCENTA
GE
NON CURRENT ASSETS
Property plant and
-1.51%
equipment 740,792,116 729,628,893 (11,163,223)
0.00%
Long Term deposit 368,876 368,876 -
-3.66%
Long Term investment 9,298,800 8,958,600 (340,200)
Current Assets
-17.29%
Loans And Advances 92,536 76,536 (16,000)
trade, deposits and
-1.66%
prepayments 604,100 594,100 (10,000)
Page | 70
0.00%
Other Receivables 20,000 20,000 -
67.95%
tax refunds 5,895,549 9,901,712 4,006,163
-55.99%
Cash & Bank Balances 6059269 2666454 (3,392,815)
-1.43%
Total Assets 763,131,246 752,215,171 -10916075
2016
GE
0.00%
40000000 ordinary Shares 400,000,000 400,000,000 -
0.00%
up capital 303,025,430 303,025,430 -
0.00%
Reserves 187,394,755 187,394,755 -
inappropriate loss/profit 837,302,791 759,658,565

-22.38%
Total Equity 346,882,606 269,238,380 (77,644,226)
-0.39%
Surplus On freehold Land 651,264,077 648,755,570 (2,508,507)
Current Liabilities
-16.08%
-4.78%
0.00%
Total Equity And
7.27%
Liabilities 752215171 806879084 54663913
Page | 71
2016
PERCENTA
GE
NON CURRENT ASSETS
Property plant and
-99.46%
equipment 729,628,893 3,961,134 (725,667,759)
#DIV/0!
investment property - 764,656,286 764,656,286
0.00%
Long Term deposit 368,876 368,876 -
127.53%
Long Term investment 8,958,600 20,383,650 11,425,050
Current Assets
-16.33%
Loans And Advances 76,536 64,036 (12,500)
trade, deposits and
0.00%
prepayments 594,100 594,100 -
810.00%
Other Receivables 20,000 182,000 162,000
45.43%
tax refunds 9,901,712 14,400,288 4,498,576
-14.92%
Cash & Bank Balances 2666454 2268714 (397,740)
7.27%
Total Assets 752,215,171 806,879,084 54663913
Page | 72
THE CRESCENT TEXTILE
MILLS LIMITED
Page | 73
INTRODUCTION:
The Crescent Textile Mills Limited engages in textile manufacturing activities in Pakistan. It
operates through five segments: Spinning, Weaving, Processing and Home Textile, Power
Generation, and Cold Storage. The company’s activities include spinning, combing, weaving,
dyeing, bleaching, printing, stitching, buying, selling, and dealing in yarn, cloth and other goods,
and fabrics made from raw cotton and synthetic fiber. It processes greige fabric for production of
printed and dyed fabric; and offers a range of home textile and hospitality products, including
quilted bed-in-a-bag items, bed linen, table linen, kitchen linen, furnishings, etc. The company
also generates, accumulates, distributes, supplies, and sells electricity. In addition, it operates a
cold storage unit for making ice and warehousing perishable goods. The company also exports
its products to the United States, Europe, Asia, Africa, and Australia. The Crescent Textile Mills
Limited was founded in 1950 and is headquartered in Faisalabad, Pakistan.
Vision Statement:
“To be the preferred choice of customers through innovative products and
solutions and be a leading contributor to the economy by enhancing value for
stakeholders”
Mission Statement:
 Investment in new technologies for increase in production resources and
consequently the profitability of the company for the benefits of the
shareholders.
 Creating new and exciting textile based products.
 Training and retaining of professional to upload a strong and healthy
organizational set up.
 Retaining of traditional customer base while exploring and expanding into
new markets.
 Improving the quality of life of the community and striving for safe and
green environment.
Page | 74
Core Values:
Our core values are at the heart of our business because they define who we are,
how we work, what we believe in and what we stand for. Our core values set out
how we act and how we expect to be treated as part of The Crescent Textile Mills
Limited.
 Integrity
 Innovation
 Customer Centricity
 Commitment
 Team Work
 Quality
COMPANY STRUCTURE/MANAGEMENT STRUCTURE
Organizational structure is a system used to define a hierarchy within an

organization. It identifies each job, its function and where it reports to within the
organization. This structure is developed to establish how an organization operates
and assists an organization in obtaining its goals to allow for future growth. The
structure is illustrated using an organizational chart.
Page | 75
VERTICAL ANALYSES OF INCOME STATEMENT
(CRECENT TEXTILE)
(For the year Ended 30th June)
2015 2016 2017
Revenue/sales*100 100 100 100
Cost Of sales/sale *100 87.215228 87.33155122 91.06028441
Gross Profit/sale*100 12.784772 12.66844878 8.939715594
Distribution Cost/sale*100 5.394137193 5.987025572 5.920059687
Administration Exps/sale*100 1.975415671 2.675754898 2.757385842
Other Expenses/sale*100 0.530850819 0.249517691 0.093527293
4.799871565
Other Income/sale*100 1.633423534 3.557158467 3.215457121
Profit from operation/sale*100 6.433295099 7.313309088 3.384199893
share of profit/loss from associate 0.228732697 0.562634225 0
reversal of carrying amount 1.195786785 0
Finance Cost/sale*100 3.620803944 3.403086302 2.637931374
Profit Before Taxation/sale*100 3.041223851 3.277070226 0.746268519
Taxation/Sale*100 1.167981647 0.908722333 0.296143703
Profit After Taxation/sale*100 1.873242204 2.368347892 1.042412222
Page | 76
Vertical analyses of BALANCE
SHEET (CRECENT TEXTILE)
2015 2016 2017
8.02899559 7.20717967 5.52042205
100000000 ordinary Shares /Total assets*100 4 7 6
4.93882788 5.76574374 4.41633764

Issued, subscribed capital/total assets*100 5 2 5
22.7584931 27.0408624 30.2529396
Reserves/total assets*100 1 7 7
32.8066062 34.6692773
Total Equity/total assets*100 27.697321 2 1
18.3920523 15.9567822 19.7361050
Surplus on revaluation of fixed assets/T.Asset*100 2 9 6
LIABILITIES
0.80285138 5.86960531
long term financing/total assets*100 5 3.20986882 2
0.08879266
Liabilities against assets to finance lease/T.Assets*100 2 0 0
0.25886284 0.41820380
Differed Liability for gratuity/total asset*100 7 8 0.00144083
CURRENT LIABILITIES
9.56393882 6.66673489 6.17351006
trade and other payables/total assets*100 6 5 7
0.43200555 0.36096935
Accrued mark-up/total assets*100 0.68450399 7 7
40.7766993 39.5298237 31.9653966
short term borrowings//total assets*100 4 8 7
current portion of non-current 0.89760156 0.47383602 1.05095586
liabilities/T.Assets*100 2 8 9
0.83737606 0.50613860 0.17273952
Provision for taxation/total assets*100 6 7 7
Total Equity and Liabilities /total assets*100 100 100 100
Page | 77
2015 2016 2017
ASSETS
NON-CURRENT ASSETS
33.2370710 32.3936708 35.7632703
Property, plant& equipment/total assets*100 3 6 9
2.71213850
investment in associate 9 0 0
0.10197323
intangible assets 6
20.4047368 24.8578365 28.5215144
long term investment 5 8 9
0.02066298 0.01062129
Long term Advances/total assets*100 0.02941824 4 2
0.03811156 0.02841913
Long term security deposit/total assets*100 0.04388649 6 3
CURRENT ASSETS
1.42105995 1.33377508 1.05732643
Stores, spare parts and loose tools/total assets*100 9 5 6
11.7903045 11.2016760
stock in trade/total asets*100 10.7389743 1 9
20.6080791 17.0484754 12.3446021
trade debts/total assets*100 9 2 9
3.38029699 3.18322992
Loans and advances/total assets*100 3.35842448 8 9
0.18306912 0.21225144 0.34274092
Short term deposits and prepayments/total assets*100 9 1 4
0.02961430
Accrued interest 1 0.02131435
5.97342017 8.14728419 6.91448871
Other receivables/total assets*100 1 4 8
0.68071091 0.48732077
short term investment 3 7
0.04171063 0.06700514 0.02150204
Cash and Bank Balances/total assets*100 2 9 4
Page | 78
HORIZENTAL ANALYSES
Income Statement of CRECENT TEXTILE 2014-2015
2015
PERCENTAG
2014 2015 AMOUNT E
Sales 12411497 11,834,775 (576,722) -4.65%
Cost of goods sold 11,036,060 10,321,726 (714,334) -6.47%
GROSS PROFIT 1,375,437 1,513,049 137,612 10.00%
distribution cost 610,760 648,384 37,624 6.16%
Administration expenses 195,553 233,786 38,233 19.55%
Other income 360,727 193,312 (167,415) -46.41%
OPERATING PROFIT 863,264 761,366 (101,898) -11.80%
Finance cost 472,319 428,514 (43,805) -9.27%
share of profit from associate 47,521 27,070 (20,451) -43.04%

PROFIT BEFORE
TAXATION 343,424 359,922 16,498 4.80%
taxation 104,405 138,228 33,823 32.40%
NET INCOME 239,019 221,694 (17,325) -7.25%

Page | 79
HORIZENTAL ANALYSES
2016
PERCENRA
PARTICULAR 2015 2016 AMOUNT GE
Sales 11,778,815 10,578,809 (1,200,006) -10.19%
GROSS PROFIT 1,457,089 1,340,171 (116,918) -8.02%
distribution cost 648,384 633,356 (15,028) -2.32%
Other income 249,272 376,305 127,033 50.96%
OPERATING PROFIT 761,366 773,661 12,295 1.61%
Finance cost 428,514 360,006 (68,508) -15.99%
Share of profit from associate 25,521 59,520 33,999 133.22%

reversal of carrying amount investment in
associate 126,500
PROFIT BEFORE TAXATION 358,373 346,675 (11,698) -3.26%
Income tax 138,073 96,132 (41,941) -30.38%
NET INCOME 220,300 250,543 30,243 13.73%

Page | 80
HORIZENTAL ANALYSES
2017
PERCENRAG
PARTICULAR 2016 2017 AMOUNT E
Sales 10,578,809 10,872,762 293,953 2.78%
Cost of goods sold 9,238,638 9,900,768 662,130 7.17%

GROSS PROFIT 1,340,171 971,994 (368,177) -27.47%
distribution cost 633,356 643,674 10,318 1.63%
Other income 376,305 349,609 (26,696) -7.09%
OPERATING PROFIT 773,661 367,956 (405,705) -52.44%
Finance cost 360,006 286,816 (73,190) -20.33%
share of profit from associate 59,520
reversal of carrying amount 126,500

PROFIT BEFORE
TAXATION 346,675 81,140 (265,535) -76.59%
Income tax 96,132 32,199 (63,933) -66.51%
NET INCOME 250,543 48,941 (201,602) -80.47%

Page | 81
HORIZENTAL ANALYSES
BALANCE SHEET of CRECENT TEXTILE 2014-2015
2015
PERCENTAG
2014 2015 AMOUNT
PARTICULARS E
Non-current assets
4,175,596 -0.86%
property plant and equipment 4,139,630 (35,966)
8.71%
investment in associate 310,723 337,793 27,070
2,539,744 0.06%
long term investment 2,541,381 1,637
10.73%
long term loans and advances 3,309 3,664 355
long term deposited and
-24.77%
prepayments 7,266 5,466 (1,800)
-100.00%
deferred income tax assets 1,780 - (1,780)
7,038,418 -0.15%
7,027,934 (10,484)
current assets
13.07%
store spare parts 156,533 176,991 20,458
1,489,590 (152,066) -10.21%
stock in trade 1,337,524
2,248,287 14.16%
trade debts 2,566,707 318,420
14.82%
loans and advances 364,305 418,287 53,982
short term deposits and
11.46%
prepayments 20,457 22,801 2,344
15.39%
accrued interest 4,392 5,068 676
30.33%
other receivables 570,830 743,981 173,151
-19.67%
short term investments 82,226 66,052 (16,174)
-25.09%
cash and bank balances 6,935 5,195 (1,740)
8.07%
4,943,555 5,342,606 399,051
Page | 82
HORIZENTAL ANALYSES
BALANCE SHEET of CRECENT TEXTILE 2015-2016
2016
PERCENTAG
2015 2016 AMOUNT
PARTICULARS E
Non-current assets
property plant and equipment 4,139,630 4,494,639 355,009 8.58%
337,793 (337,793) -100.00%
investment in associate -
long term investment 2,541,381 3,449,038 907,657 35.72%
-21.75%
long term loans and advances 3,664 2,867 (797)
long term deposited and
-3.26%
prepayments 5,466 5,288 (178)
- #DIV/0!
deferred income tax assets - -
7,027,934 7,951,832 923,898 13.15%
current assets
store spare parts 176,991 185,062 8,071 4.56%
stock in trade 1,337,524 1,635,911 298,387 22.31%
trade debts 2,566,707 2,365,485 (201,222) -7.84%
loans and advances 418,287 469,018 50,731 12.13%
short term deposits and
22,801 6,649 29.16%
prepayments 29,450
-18.92%
accrued interest 5,068 4,109 (959)
other receivables 743,981 1,130,440 386,459 51.94%
66,052 28,397 42.99%
short term investments 94,449
4,102 78.96%
cash and bank balances 5,195 9,297
5,342,606 5,923,221 580,615 10.87%
Page | 83
Financial Years
Financial Ratios
Formulas 2015 2016 2017
Operating Cycle
No. of days of day 49.98663 96.45551 126.1721
inventory inventory/cost of goods sold/365 s 063 493 222
No. of days of day 22.94535 24.59283 41.69079
receivables accounts receivable/sale on credit/365 s 088 063 121
day 42.75254 31.17709 26.73247
no. of days of payables accounts payable/purchases/365 s 777 204 062
Liquidity Ratios
0.813033 1.202480 1.564923
Current Ratio current assets/current liability % 788 31 042
0.609490 0.805114 0.978817
Quick Ratio current assets-inventory/current liability % 385 955 183
- - -
Networking capital to 0.103812 0.064514 0.069130
sale ratio current assets - current liability/sales % 029 729 548
Profitability
12.78477 12.66844 8.939715
Gross profit margin gross income/sales % 2 878 594
Operating profit 6.433295 7.313309 3.384199
margin operating income/sales % 099 088 893
1.873242 2.368347 1.042412
Net profit margin net income / sales % 204 892 222
Activity
tim 7.301952 5.647396 4.879307
Inventory Turnover cost of goods sold/ inventory es 45 466 133
Accounts receivable tim 15.90736 4.472152 4.862225
turnover sales on credit/accounts receivable es 188 222 144
tim 0.950213 0.762433 0.600222
Total asset turnover sales / total assets es 563 772 352
tim 2.858896 1.330361 0.931649
Fixed asset turnover sales / fixed assets es 81 23 068
Financial leverage
Total debt to assets 0.539106 0.512366 0.455946
ratio total debt /total assets 267 115 176
Long-term debt to 0.011505 0.036280 0.058710
assets ratio long term debt/ total assets 069 726 461
Total debt to equity 1.946420 1.561777 1.315130
ratio total debt/total shareholders equity 258 258 316
3.610457 3.048166 2.884398
Equity multiplier total assets/shareholders’ equity 488 56 169
Time-interest-coverage 1.839930 1.962970 1.282899
ratio earning before interest& tax/ interest 551 062 141
Fixed-charge coverage EBIT+ lease payment/ interest+ 1.778413 1.882854 1.272439
Ratio payment 38 778 126
Shareholder Ratios
Earnings per Share net income available to S.H/ no of 3.973866 3.568246 1.416737
Page | 84
shares outstanding 986 897 5
dividend paid to shareholders/no of
Dividend per share share outstanding
Dividend payout ratio dividends/earnings
market price per share/earning 5.327455 5.271708
Price Earnings Ratio per share 919 683
Return Ratios
Basic earning power 0.061130 0.055759 0.020312
ratio operating income/total assets % 043 138 724
0.020004 0.018057 0.006256
Return on assets net income / total assets 644 084 791
7.222591 5.504100 1.804707
Return on Equity net income/shareholders’ equity 663 016 695
Page | 85
GUL AHMED TEXTILE
MILLS LTD.
Page | 86
INTRODUCTION:
The story of textiles in the subcontinent is the story of Gul Ahmed. The group began trading in
textiles in the early 1900s. The group entered in the field of manufacturing with the
establishment of today’s iconic name of Gul Ahmed Textile Mills Ltd in the year 1953. Since its
listing on the Karachi Stock Exchange in 1970, the company has been making rapid progress and
enjoying a leading position in the world of textiles.
With an installed capacity of more than 130,000 spindles, 300 state-of-the-art weaving machines
and most modern yarn dyeing, processing & stitching units, Gul Ahmed is a composite unit –
making everything from cotton yarn to finished products. Gul Ahmed has its own captive power
plant comprising of gas engines, gas & steam turbines, and backup diesel engines. Believing in
playing its role in protecting the environment, Gul Ahmed has also set up a waste water
treatment plant to treat 100% of its effluent, bringing it to NEQS levels.
Gul Ahmed is playing a vital role not only as a textile giant, but has its strong presence in the
retail business as well. The opening of its flagship store – Ideas by Gul Ahmed– marked the
group’s entry into the retail business. Starting from Karachi, Gul Ahmed now has an extensive
chain of more than 40 retail stores across the country, offering a diverse range of products from
home accessories to fashion clothing. More than 50 years since its inception, the name Gul
Ahmed is still globally synonymous ith quality, innovation & reliability.
COMPANY’S VISION & MISSION STATEMENT
VISION:
Setting trends globally in the textile industry. Delivering the best products and services to our
customers.
MISSION:
To deliver value to our stakeholders through innovative technology, team work and by fulfilling
our social and environmental responsibilities.
VALUE:
In achieving its vision and fulfilling its mission, the Company shall operate on the following core
values:
Integrity
Passion
Creativity
Teamwork
Page | 87
Financial Financial Years
Ratios Formulas
2015 2016 2017
Operating Cycle
15.519
5 8.79953 3.044022
No. of days of inventory Inventory/CGS/365
3.6264
8 53.0004 38.05255
No. of days of receivables A/C receivables/credit sales/365
83.015
3 20.3354 40.24588
no. of days of payables A/C payables/Purchases/365
Liquidity Ratios
1.0505
2 1.07546 1.111494
Current Ratio Current assets/current liabilities
0.2757
9 0.32558 0.431417
Quick Ratio C.A-Inventory/current liabilities
0.0226
Net working capital to sale 7 0.04319 0.051232
ratio C.A-C.L/Sales
Profitability
0.1827
1 22.6378 17.656832
Gross profit margin Gross Income/Sales
0.0634
8 4.22555 6.9559345
Operating profit margin Operating Income/Sales
1.8136
6 3.53662 2.050960
Net profit margin Net Income /Sales
Activity
2.3502
1 1.98648 2.496441
Inventory Turnover CGS/Inventory
10064.
Accounts receivable Credit Sales/Account 8
turnover Receivable
Page | 88
1.3372
2 1.00327 1.086758
Total asset turnover Sales/Total Assets
3.6902
2 2.67828 2.498821
Fixed asset turnover Sales/Fixed Assets
Financial leverage
0.4508 0.5196741
5 0.54390
Total debt to assets ratio Total Debt/Total Assets
0.1946258
0.0965 77
Long-term debt to assets 2 0.14394
ratio Long-term Debt/Total Assets
1.5685
8 2.00693 1.7483865
Total debt to equity ratio Total Debt/Shareholder equity
3.4791
0 2.94751 3.364389
Equity multiplier Total Assets/Shareholder equity
Shareholder Ratios
11.88 11.64 12.76
Earnings per Share Outstanding
Dividend/No. of share
Dividend per share outstanding 0 0 0
Dividend payout ratio Dividend/Earnings 0 0 0
Price Earnings Ratio Share 0 0 0
Return Ratios
0.0459
2 0.06994 0.0459215
Basic earning power ratio Operating Income/Total Assets
0.0222
8
Return on assets Net Income /Total Assets 0.03548 0.0222889
0.7498 0.13092
84 43 0.7498847
Return on Equity Net Income/Shareholder equity
Page | 89
OPERATING CYCLE

100
95
90
85
80
75
2015 2016 2017

45
40
35
30
25
20
15
10
5
0
2015 2016 2017

32
31
30
29
28
27
26
25
24
2015 2016 2017
Page | 90
LIQUIDITY RATIO
Current Ratio
2
1.5
0.5
0
2015 2016 2017
1.2
0.8
0.6
0.4
0.2
0
2015 2016 2017
QUICK RATIO

1.4
1.2
1
0.8
0.6
0.4
0.2
0
2015 2016 2017
Page | 91
PROFITABILITY
Gross Profit Margin

0.15
0.145
0.14
0.135
0.13
2015 2016 2017

0.04
0.03
0.02
0.01
0
no ooo jhjjk
Net Profit Margin

0.04
0.035
0.03
0.025
0.02
0.015
0.01
0.005
0
Category 1 Category 2 Category 3
Page | 92
Activity
30
25
Inventory turnover
20
15 Account recievable
turnover
10
5
0
2015 2016 2017
Fixed Asset Ratio

4
0
2015 2016 2017
Page | 93
FINANCIAL LEVERAGE
2.5
2
Total debt to asset
1.5
0.5
0
2015 2016 2017
10
9
8
7
6 equity multiplier
5
4
2
1
0
2015 2016 2017
Page | 94
RETURN RATIOS
0.12
0.1

ratio
0.02
0
2015 2016 2017
Page | 95
VERTICAL ANALYSIS (2015-2017)
Profit and Loss Account
For the Year Ended 30th June
2015 2016 2017
Revenue/sales*100 100 100 100
Cost Of sales/sale *100 81.72859102 77.36215178 82.34316574
Gross Profit/sale*100 18.27140898 22.63784822 17.65683426
Distribution Cost/sale*100 7.803639202 10.04594765 8.730527986
Administration Exps/sale*100 1.770593994 2.038157766 2.054905309
Other Expenses/sale*100 0.55583331 5.682392656 5.775725246
Other Incime/sale*100 1.02862306 0.472626176 1.221266208

Profit from opreation/sale*100 6.348762444 6.955934576 0.042255548
Finance Cost/sale*100 4.000292732 2.821070567 2.198801924
Profit Before Taxation/sale*100 2.348469713 4.134864009 2.026752892
Taxation/Sale*100 0.510823275 0.598239059 0.024207904
Profit After Taxation/sale*100 18.03224887 3.53662495 4.722350627
Page | 96
BALANCE SHEET
Liabilities and Owners Equity 2015 2016 2017

Issued, subscribed capital/total assets*100 9.161673451 9.234889839 9.708834241
Reserves/total assets*100 16.95842984 17.86625637 20.01418243
Total Equity/total assets*100 28.74302314 27.10114621 29.72307114
LIABILITIES
long term financing/total assets*100 9.652802409 14.39449825 7146.001114
Liabilities against assets to finance lease/T.Assets*100
Differed Liability for gratuity/total asset*100 15.80742953 1.072629485 0.87754263
CURRENT LIABILITIES
trade and other payables/total assets*100 20.90012218 15.56486389 15.2056643
Accrued mark-up/total assets*100 0.827799894 0.355519491 0.378112803
short term borrowings//total assets*100 35.43299141 39.99623181 32.50483296
current portion of non-current
liabilities/T.Assets*100 2.862518811 39.99623181 1.84786367
Provision for taxation/total assets*100 1.210383236 1.515110868 0.394767611
Total Equity and Liabilities /total assets*100 100 100 100
2015 2016 2017
ASSETS
NON-CURRENT ASSETS
Property, plant& equipment/total assets*100 0.362368571 37.45956194 43.49083213
Long term Advances/total assets*100 0.234331022 0.067828722 0.109186955
Long term security deposit/total assets*100 0.375138108 0.483436627 0.524607753
CURRENT ASSETS
Stores, spare parts and loose tools/total assets*100 2.802599026 2.808416842 2.691317377
stock in trade/total asets*100 45.23778625 43.06686168 33.96081972
trade debts/total assets*100 7.672875657 7.349568437 9.109931862
Loans and advances/total assets*100 1.419713241 2.225338516 1.876372326
Short term deposits and prepayments/total assets*100 0.388071416 0.680550251 0.41576667
Other receivables/total assets*100 1.328606782 1.478768724 3.113127294
Cash and Bank Balances/total assets*100 0.470269688 0.956742466 0.734999349
Page | 97
HORIZONTAL ANALYSIS
In horizontal analysis, for creating profit and loss account we take the previous year sale as base
and multiply the amount with 100.While on other hand, while creating balance sheet, the amount
of total assets of previous year is taking as a base and multiply them with 100.
Profit And Loss ACCOUNT

For the year ended 30th June
2015 2016 2017
Revenue/ Previous year sales*100 10.04623666 96.7614001 123.6401889
Cost Of sales/ P.sale *100 82.5754185 74.85670122 101.8092456
Gross Profit/P.sale*100 18.46072745 21.90469889 21.83106717
Distribution Cost/P.sale*100 7.884496293 9.7205996 6.375516882
Administration Exps/P.sale*100 4.639374806 0.412396615 0.18087623
Other Expenses/P.sale*100 0.561592554 0.412396615 0.046045709
Other Income/P.sale*100 1.039281097 4.572471523 3.71450811

Profit from operation/P.sale*100 4.030752877 6.730659686 5.224483956
Finance Cost/P.sale*100 4.115086507 2.729707379 2.718602852
Profit Before Taxation/P.sale*100 2.366352086 4.000952307 2.505881103
Taxation/P.Sale*100 0.538880124 16.91553578 0.029930698
Profit After Taxation/P.sale*100 1.827471963 3.422087818 2.535811802
Page | 98
BALANCE SHEET
Liabilities and Owners Equity 2015 2016 2017
Issued, subscribed capital/total assets*100 9.413059748 1.191819793 11.08186718
Reserves/total assets*100 17.4237506 23.04198791 22.84460791
Total Equity/total assets*100 29.53170025 34.95216179 33.92653727
Surplus on revaluation of freehold land/T.Asset*100
LIABILITIES
long term financing/total assets*100 9.917664746 18.56448535 22.21500381
Liabilities against assets to finance lease/T.Assets*100
Differed Liability for gratuity/total asset*100 1.001645577 1.383362866 1.001645577
CURRENT LIABILITIES
trade and other payables/total assets*100 21.47359867 20.07389786 17.35606439
Accrued mark-up/total assets*100 0.850513817 0.458511041 0.43158589
short term borrowings//total assets*100 36.40523393 51.58286496 3.999432426
current portion of non-current liabilities/T.Assets*100 2.941063196 19.55391151 37.1016986
Provision for taxation/total assets*100
Total Liabilities /total assets*100 61.67040962 74.06930193 56.99891228
2015 2016 2017

ASSETS
NON-CURRENT ASSETS
Property, plant& equipment/total assets*100 37.23115678 48.31133929 49.64134864
Long term Advances/total assets*100 0.052967378 0.234331022 0.124628283
Long term security deposit/total assets*100 0.385431487 0.623484892 0.5987983
CURRENT ASSETS
Stores, spare parts and loose tools/total assets*100 2.879499277 3.621995877 3.071926143
stock in trade/total asets*100 46.47906162 55.54303518 38.76359244
trade debts/total assets*100 7.883410971 9.478687844 19696.86862
Loans and advances/total assets*100 1.458668619 2.870003773 2.141730757
Short term deposits and prepayments/total assets*100 0.398719672 0.877700976 0.474564804
Other receivables/total assets*100 1.365062299 1.907157849 3.553388836
Cash and Bank Balances/total assets*100 0.483176956 1.233904175 0.838943684
Total Current Assets 64.78628287 79.65866008 63.35398172
Page | 99
COMMON SIZE ANALYSIS
Common size for Year 2015

Gull
MTM Kohinoor Nishat Crescent
Ahmad
Sale 26967899 26684120 51177577 11834775 33354786
CGS 22988317 12492508 45153439 10321726 27260395
Gross Profit 3979582 14191612 6024138 1513049 6094391
Other Exp 54498 0 366142 62825 185397
Net Income 3925084 14191612 5657996 1450224 5908994
%age 14.55465255 53.18373624 11.05561524 12.25392118 17.71558061

Gull
Ahmad
Sale 23183485 29572664 69645654 10578809 32274556
CGS 19971238 58715717 57073635 9238638 24968291
Gross Profit 3212247 -29143053 12572019 1340171 7306265
Other Exp 48644 0 320042 26396 1833967
Net Income 3163603 -29143053 12251977 1313775 5472298
Page | 100
%age 13.64593373 -98.54726987 17.59187587 12.41893109 16.95545556

Gull
Ahmad
Sale 23393876 0 76321513 10872762 39904322
CGS 20008592 0 63919297 9900768 32858482
Gross Profit 3385284 0 12402216 971994 7045840
Other Exp 10675 0 210163 10169 2304764
Net Income 3374609 0 12192053 961825 4741076
%age 14.42518119 0 15.97459552 8.846188301 11.88110902
Page | 101
Common size % for Year 2015
Gull
Ahmad
Sale 100 100 100 100 100
CGS 85.24326274 46.81626376 88.22895035 87.215228 81.72858612
Gross
14.75673726 53.18373624 11.77104965 12.784772 18.27141388
Profit
Other
0.202084708 0 0.715434418 0.530850819 0.555833277
Exp
Net
14.55465255 53.18373624 11.05561524 12.25392118 17.71558061
Income

Gull
Ahmad
Sale 100 100 100 100 100
CGS 86.14424449 198.5472699 81.9485951 87.33155122 77.36215178
Gross
13.85575551 -98.5472699 18.0514049 12.66844878 22.63784822
Profit
Other
0.209821776 0 0.459529032 0.249517691 5.682392656
Exp
Net
13.64593373 -98.5472699 17.59187587 12.41893109 16.95545556
Income
Page | 102
Gull
Ahmad
Sale 100 0 100 100 100
CGS 85.52918721 0 83.75003913 91.06028441 82.34316574
Gross
14.47081279 0 16.24996087 8.939715594 17.65683426
Profit
Other
0.0456316 0 0.275365348 0.093527293 5.775725246
Exp
Net
14.42518119 0 15.97459552 8.846188301 11.88110902
Income
SUMMARY 2015
 Sale Summary of all companies in 2015

According to net sales of all companies it is conclude that nishat textile is on
the top in sale of 2015 and the crescent textile in last.
 Gross profit summary of all companies 2015
According to gross profit of it is conclude that Kohinoor textile is on the top
(53.18) % and nishat textile is at the end with (11.77) %.
 Summary of net income of all companies 2015
It is conclude that the highest net income is of Kohinoor textile with (53.18)
%. The lowest net income is of nishat textile with (11.055) %.
Page | 103
SUMMARY 2016


According to gross profit of it is conclude that Gul Ahmed is on the top
(22.63) % and nishat textile is at the end with (-98.54) %.

It is conclude that the highest net income is of nishat textile with (17.59) %.
The lowest net income is of crescent textile with (12.41) %.
SUMMARY 2017

According to gross profit of it is conclude that Gul Ahmed is on the top
(17.65) % and crescent textile is at the end with (8.93) %.
It is conclude that the highest net income is of nishaat textile with (15.97) %
The lowest net income is of crescent textile with (8.84) %.
Page | 104
THE END
Page | 105

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FINANCIAL & MANAGERIAL ACCOUNTING

UNIVERSITY OF AGRICULTURE FAISALABAD

12/9/2018 PROJECT: PROF.AWAIS ASLAM

 Zeenat Khalid  M.Waqas Akbar  Akash Ahmad

 Aleeha Khalid  Afra  Asad Ali

 Khadija Ejaz  Azka Liaqat  M.Shehroz

PROJECT SECTOR TEXTILE:

COMPANY’S VISION AND MISSION STATEMENT ....................................................................... 10

06 Steps to an Effective Financial Statement Analysis:

1. Identify the industry economic characteristics.

2. Identify company strategies.

3. Assess the quality of the firm’s financial statements.

4. Analyze current profitability and risk.

6. Value the firm.

INTRODUCTION OF TEXTILE SECTOR

VERTICALLY INTEGRATED OPERATIONS:

EXPERIENCED PROFESSIONAL MANAGEMENT:

AGGRESSIVE R&D FACILITY:

SOCIAL & ENVIRONMENTAL RESPONSIBILITIES:

MASOOD TEXTILE MILLS PVT. LTD.

No. of Days inventory

No. days of recievables

No. of Days of payables

Net working capital to sale ratio

Gross Profit Margin

Operating Profit Margin

Fixed Asset Ratio

1 total debt to equity

0.08 basic earning power

0.04 return on equity

PROFIT AND LOSS ACCOUNT

2015 2016 2017

Revenues Revenue/sales*100 100 100 100

Cost Of Sales Cost Of sales/sale *100 85.24326274 86.14424449 85.52918721

Gross Profit Gross Profit/sale*100 14.75673726 13.85575551 14.47081279

Distribution Cost Distribution Cost/sale*100 5.461949409 6.021579586 61.74367428

Admin. Expenses Administration Exps/sale*100 1.770593994 2.038157766 2.054905309

Other Expenses Other Expenses/sale*100 0.202084708 0.209821776 0.0456316

Other Income Other Income/sale*100 0.224058982 1.471789077 0.93204307

Profit From Operations Profit from operation/sale*100 7.546168131

Finance Cost Finance Cost/sale*100 3.718839944 3.099482239 2.73863553

Profit Before Taxation Profit Before Taxation/sale*100 3.827328187 3.958503219 4.245504251

Taxation Taxation/Sale*100 1.03099244 0.813083106 0.453909391

Profit After Taxation Profit After Taxation/sale*100 2.796335747 3.145420113 3.79159486

2015 2016 2017

Property, plant & equipment/total assets*100 28.65 29.53 31.1

Stores, spare parts and loose tools/total

Stock In Trade stock in trade/total assets*100 22.96 23.21 25.71

Trade Debts trade debts/total assets*100 30.09 26.69 20.88

Short Term Deposits & Short term deposits and prepayments/total

Other Receivables Other receivables/total assets*100 4.815 6.872 9.933

Total Assets 100 100 100

Income Statement of MTM 2014-2015

PARTICULAR 2015 2016 AMOUNT PERCENRAGE

Sales 26,967,899 23,183,485 (3,784,414) -14.03%

Cost of goods sold 22,988,317 19,971,238 (3,017,079) -13.12%

GROSS PROFIT 3,979,582 3,212,247 (767,335) -19.28%