Crown cement LTD

Financial Report On
Crown cement LTD
Course Code: FIN 422
Course Title: Financial Analysis & control

Prepared By
Takibul Hasan

Id: 18100042

Batch:12th

Prepared For
Nazmul Hasan
Associate Professor
School of Business

Date of Submission: 26th July, 2021

Ranada Prasad Shaha University
Crown cement LTD

Contents
Summary ....................................................................................................................................................... 3
What is income statement? ........................................................................................................................... 3
Importance of an income statement .............................................................................................................. 3
Who uses an income statement? ................................................................................................................... 4
Income statement format with the major components .................................................................................. 4
What is Horizontal Analysis? ....................................................................................................................... 7
Balance Sheet .............................................................................................................................................. 11
Ratio Analysis ............................................................................................................................................. 19
What is Quick Ratio?............................................................................................................................ 20
What Is a Z-Score? .............................................................................................................................. 31
Crown cement LTD

Summary
Crown cement, the pioneer in the export of cement products in Bangladesh, is a well-established
brand of M.I Cement Factories Ltd. & achieved the national export trophy (gold) in two
consecutive years 2008-2009 and 2009-2010 for attaining the leading place among the cement
exporters in Bangladesh. Crown cement has a total production capacity of 5800tpd i.e. 1.74
million metric ton per annum. Crown Cement, carefully manages and offers a learning
environment, career development strategy and smooth progression of our talents. We offer an
excellent organizational culture and competitive compensation package compared to industry.
We look for individuals with good educational background, team-spirit, drive for professional
excellence and creative mindset to deliver the best outcome. Crown Cement cordially welcomes
individuals to explore the opportunities to grow. We value our customers by focusing on their
needs by means of our state-of-the-art technology and offering diversified products to the best of
our ability.

What is income statement?

An income statement is a financial statement that shows you the company’s income and
expenditures. It also shows whether a company is making profit or loss for a given period. The
income statement, along with balance sheet and cash flow statement, helps you understand the
financial health of your business.

The income statement is also known as a profit and loss statement, statement of operation,
statement of financial result or income, or earnings statement.

Importance of an income statement

An income statement helps business owners decide whether they can generate profit by
increasing revenues, by decreasing costs, or both. It also shows the effectiveness of the strategies
that the business set at the beginning of a financial period. The business owners can refer to this
document to see if the strategies have paid off. Based on their analysis, they can come up
with the best solutions to yield more profit.

Following are the few other things that an income statement informs.

1. Frequent reports: While other financial statements are published annually, the income
statement is generated either quarterly or monthly. Due to this, business owners and
Crown cement LTD

investors can track the performance of the business closely and make informed decisions. This
also enables them to find and fix small business problems before they become large and
expensive.

2. Pinpointing expenses: This statement highlights the future expenses or any unexpected
expenditures which are incurred by the company, and any areas which are over or under budget.
Expenses include building rent, salaries and other overhead costs. As a small business begins to
grow, it may find its expenses soaring. These expenditures may involve hiring workers, buying
supplies and promoting the business.

3. Overall analysis of the company: This statement gives investors an overview of the business
in which they are planning to invest. Banks and other financial institutions can also analyze this
document to decide whether the business is loan-worthy.

Who uses an income statement?

There are two main groups of people who use this financial statement: internal and external
users. Internal users include company management and the board of directors, who use this
information to analyze the business’s standing and make decisions in order to turn a profit. They
can also act on any concerns regarding cash flow. External users comprise investors, creditors,
and competitors. Investors check whether the company is positioned to grow and be profitable in
the future, so they can decide whether to invest in the business. Creditors use the income
statement to check whether the company has enough cash flow to pay off its loans or take out a
new loan. Competitors use them to get details about the success parameters of a business and get
to know about areas where the business is spending an extra bit, for example, R&D spends.

Income statement format with the major components

The following information is covered in an income statement. The format for this document may
vary depending on the regulatory requirements, the diverse business needs and the associated
operating activities.

Revenue or sales: This is the first section on the income statement, and it gives you a summary
of gross sales made by the company. Revenue can be classified into two types: operating and
non-operating. Operating revenue refers to the revenue gained by a company by performing
primary activities like manufacturing a product or providing a service. Non-operating revenue is
gained by performing non-core business activities such as installation, operation, or maintenance
of a system.

Cost of goods sold (COGS): This is the total cost of sales or services, also referred to as the cost
incurred to manufacture goods or services. Keep in mind that it only includes the cost of
products which you sell. COGS does not usually include indirect costs, like overhead.
Crown cement LTD

Gross profit: Gross profit is defined as net sales minus the total cost of goods sold in your
business. Net sales is the amount of money you brought in for the goods sold, while COGS is the
money you spent to produce those goods.

Gains: Gain is a result of a positive event that causes an organization’s income to

increase. Gains indicate the amount of money realized by the company from various business
activities like the sale of an operating segment. Likewise, the profits from one time non-business
activities are also included as gains for the business. For example, company selling off old
vehicles or unused lands etc. Although gain is considered secondary type of revenue, the two
terms are different. Revenue is the money received by a company regularly while gain can be
accounted for the sale of fixed assets, which is counted as a rare activity for a company.

Expenses: Expenses are the costs that the company has to pay in order to generate
revenue. Some examples of common expenses are equipment depreciation, employee
wages, and supplier payments. There are two main categories for business
expenses: operating and non-operating expenses. Expenses generated by company’s core
business activities are operating expenses, while the ones which are not generated by core
business activities are known as non-operating expenses. Sales commission, pension
contributions, payroll account for operating expenses while examples of non operating expenses
include obsolete inventory charges or settlement of lawsuit.

Advertising expenses: These expenses are simply the marketing costs required to expand the
client base. They include advertisements in print and online media as well as radio and video ads.
Advertising costs are generally considered part of Sales, General & Administrative (SG&A)
expenses.

Administrative expenses: It can be defined as the expenditure incurred by a business or

company as a whole rather than being the ones associated with specific departments of the same
company. Some of the examples of administrative expenses are salaries, rent, office supplies,
and travel expenses. Administrative expenses are fixed in nature and tend to exist irrespective of
the level of sales.

Depreciation: Depreciation refers to the practice of distributing the cost of a long-term asset
over its life span. It is a management accord to write off a company’s asset value but it is
considered a non-cash transaction. Depreciation mainly shows the asset value used up by the
business over a period of time.

Earnings before tax (EBT): This is a measure of a company’s financial performance. EBT is
calculated by subtracting expenses from income, before taxes. It is one of the line items on a
multi-step income statement.

Net income: Net profit can be defined as the amount of money you earn after deducting
allowable business expenses. It is calculated by subtracting total expenses from total revenue.
 Crown cement LTD

While net income is a company’s earnings, gross profit can be defined as the money earned by a
company after deductingg the cost of goods sold.

Income statement

particulars

2020 2019 2018 2017

Revenue 13,876,211,430 14,628,432,591 12,559,311,599 9,439,820,021
Cost of sales (12,454,360,809) (12,698,608,615) (10,915,891,226) (7,829,382,292)
Gross profit 1,421,850,621 1,929,823,976 1,643,420,373 1,610,437,729
Income from mother vessel operation 164,378,250 163,507,500 147,400,000 108,535,500
Administrative expenses (252,038,375) (310,036,744) (307,978,897) (209,406,229)
Selling and distribution expenses (534,608,700) (605,881,338) (481,551,631) (399,790,016)
(622,268,825) (752,410,582) -642,130,528
642,130,528 -500,660,745
Operating profit 799,581,796 1,177,413,394 1,001,289,845 1,109,776,984
Non-operating income and expenses 36,578,103 44,823,643 146,550 58,694,472
Finance cost (992,407,650) (1,004,203,672) (798,271,896) (499,434,000)
 Crown cement LTD

Financial income 110,913,521 213,753,067 195,795,104 169,175,158

(844,916,025) (745,626,962) 31,776,497 64,665,276
Net (loss)/profit before WPPF & Income tax (45,334,229) 431,786,432 430,736,100 902,877,890
Workers' profit participation fund (WPPF) - (20,561,259) (20,511,243) (42,994,185)
Net (loss)/profit before tax (45,334,229) 411,225,173 410,224,857 859,883,705
Share of profit from associates 17,114,045 24,187,271
(Loss)/profit before income tax (28,220,184) 435,412,444 410,224,857 859,883,705
Income tax
Current tax expense (94,370,185) (84,716,866) (1,231,336) (166,339,734)
Deferred tax expense (9,862,903) (99,545,423) (93,380,754) (32,464,873)
(104,233,088) (184,262,289) (94,612,090) (198,804,607)
Net (loss)/profit after tax for the year (132,453,272) 251,150,155 315,612,767 661,079,098
(Loss)/profit for the year (132,453,272) 251,150,155 315,612,767 661,079,098
Add: Other comprehensive income - -
Total other comprehensive (loss)/profit for the year (132,453,272) 251,150,155 315,612,767 661,079,098

What is Horizontal Analysis?

Horizontal analysis is an approach used to analyze financial statements by comparing specific
financial information for a certain accounting period with information from other periods.
Analysts use such an approach to analyze historical trends.

Trends or changes are measured by comparing the current year’s values against those of the base
year. The goal is to determine any increase or decline in specific values. A percentage or an
absolute comparison may be used in horizontal analysis.

Horizontal analysis can also be compared with vertical analysis. Whereas vertical analysis
analyzes a particular financial
nancial statement using only one base financial statement of the reporting
period, horizontal analysis compares a specific financial statement with other periods or the
cross-sectional
sectional analysis of a company against another company.

Trend analysis
Trend analysis tries to predict a trend
trend,, such as a bull market run, and then ride that trend until
data suggests a trend reversal, such as a bull
bull-to-bear
bear market. Trend analysis is based on the idea
that what has happened in the past gives traders an idea of what will happen in the future.
Crown cement LTD

Vertical Analysis

Vertical analysis is a method of financial statement analysis in which each line item is listed as a
percentage of a base figure within the statement. Thus, line items on an income statement can be
stated as a percentage of gross sales, while line items on a balance sheet can be stated as a
percentage of total assets or liabilities, and vertical analysis of a cash flow statement shows each
cash inflow or outflow as a percentage of the total cash inflows.
Crown cement LTD

2020-2019
2019 Trend percentage
120.00%
100.00%
80.00%
60.00%
40.00%
20.00%
0.00%
-20.00% 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
-40.00%
-60.00%

2020
2020-2019 Trend percentage
Crown cement LTD

2018-2017
2017 Trend percentage

300.00%
200.00%
100.00%
0.00%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

2018
2018-2017 Trend percentage

Growth Analysis:

A revenue growth analysis is the examination of changes in total revenu

revenue.. Further insights can be
gained by looking at revenue growth by categories such as segments and geographic regions.
Analyzing unit sales and price changes is also valuable
valuable.
Crown cement LTD

Chart Title
Axis Title 16,000,000,000
14,000,000,000
12,000,000,000
10,000,000,000
8,000,000,000
6,000,000,000
4,000,000,000
2,000,000,000
-2,000,000,0000
Reven Net Net sales Net % Sales %
ue incom profit Growt profit Chang Growt Chang
e margin h(Geo Growt e in h e in
metric h(Geo Sales (Geom Sales
Mean) matric atric
mean) Mean)
2020 13,876 -1E+08 -0.95% 13.70% -158.5 0.95 1.137 13.70%
2019 14,628 251,15 1.72% 15.72% -27.57 1.16
2018 12,559 315,61 2.51% 9.99% -21.84 1.33
2017 9,439, 661,07 7.00%

Balance Sheet
A balance sheet is a financial statement that reports a company's assets, liabilities and
shareholders' equity at a specific point in time, and provides a basis for computi ng rates of return
and evaluating its capital structure
structure.. It is a financial statement that provides a snapshot of what a
company owns and owes, as well as the amount invested by share shareholders.

The balance sheet is used alongside other important financial statements such as the income
statement and statement of cash flows in conducting fundamental analysis or ccalculating
financial ratios.

Formula Used for a Balance Sheet

Assets=Liabilities + Shareholders’ Equity

What's On the Balance Sheet?

Crown cement LTD

Assets
Within the assets segment, accounts are listed from top to bottom in order of their liquidity – that
is, the ease with which they can be converted into cash. They are divided into current assets,
which can be converted to cash in one year or less; and non-current or long-term assets, which
cannot.

Here is the general order of accounts within current assets:

Cash and cash equivalents are the most liquid assets and can include Treasury bills and short-term
certificates of deposit, as well as hard currency.

Marketable securities are equity and debt securities for which there is a liquid market.

Accounts receivable refers to money that customers owe the company, perhaps including an
allowance for doubtful accounts since a certain proportion of customers can be expected not to
pay.

Inventory is goods available for sale, valued at the lower of the cost or market price.

Prepaid expenses represent the value that has already been paid for, such as insurance, advertising
contracts or rent.

Long-term assets include the following:

Long-term investments are securities that will not or cannot be liquidated in the next year.

Fixed assets include land, machinery, equipment, buildings and other durable, generally capital-intensive
assets.

Intangible assets include non-physical (but still valuable) assets such as intellectual property and
goodwill. In general, intangible assets are only listed on the balance sheet if they are acquired, rather than
developed in-house. Their value may thus be wildly understated – by not including a globally recognized
logo, for example – or just as wildly overstated.

Liabilities

Liabilities are the money that a company owes to outside parties, from bills it has to pay to
suppliers to interest on bonds it has issued to creditors to rent, utilities and salaries. Current
liabilities are those that are due within one year and are listed in order of their due date. Long-
term liabilities are due at any point after one year.

Current liabilities accounts might include:

Current portion of long-term debt

Bank indebtedness
Crown cement LTD

Interest payable

Wages payable

Customer prepayments

Dividends payable and others

Earned and unearned premiums

 accounts payable

Long-term liabilities can include:

Long-term debt: interest and principal on bonds issued

Pension fund liability: the money a company is required to pay into its employees' retirement
accounts

Liability: Taxes that have been accrued but will not be paid for another year (Besides timing,
this figure reconciles differences between requirements for financial reporting and the way tax is
assessed, such as depreciation calculations.)

Some liabilities are considered off the balance sheet, meaning that they will not appear on the
balance sheet.

Shareholders' Equity

Shareholders' equity is the money attributable to a business' owners, meaning its shareholders. It
is also known as "net assets," since it is equivalent to the total assets of a company minus its
liabilities, that is, the debt it owes to non-shareholders.

Retained earnings are the net earnings a company either reinvests in the business or use to pay
off debt; the rest is distributed to shareholders in the form of dividends.

Treasury stock is the stock a company has repurchased. It can be sold at a later date to raise cash
or reserved to repel a hostile takeover.

Some companies issue preferred stock, which will be listed separately from common stock under
shareholders' equity. Preferred stock is assigned an arbitrary par value – as is common stock, in
some cases – that has no bearing on the market value of the shares (often, par value is just
$0.01). The "common stock" and "preferred stock" accounts are calculated by multiplying the
par value by the number of shares issued.

Additional paid-in capital or capital surplus represents the amount shareholders have invested in
excess of the "common stock" or "preferred stock" accounts, which are based on par value rather
Crown cement LTD

than market price. Shareholders' equity is not directly related to a company's market
capitalization: the latter is based on the current price of a stock, while paid-in capital is the sum
of the equity that has been purchased at any price.
Crown cement LTD
Crown cement LTD
Crown cement LTD
Crown cement LTD

Balance sheet
sheet-2020-2019
Trend % A/Bx 100%
1000.00%

800.00%

600.00%

400.00% Trend % A/Bx 100%

200.00%

0.00%
1 4 7 10 13 16 19 22 25 28 31 34 37 40 43

Balance sheet
sheet-2018-2017
Trend % A/Bx 100%
300.00%
250.00%
200.00%
Axis Title

150.00%
100.00%
50.00%
0.00%
1 3 5 7 9 1113
13 1517 19 21 2325 272931 3335 3739 41 43 45

Axis Title
Crown cement LTD

Ratio Analysis

Current ratio
The current ratio is balance-sheet financial performance measure of company liquidity.
Crown cement LTD

The current ratio indicateses a company's ability to meet short

short-term
term debt obligations. The current
ratio measures whether or not a firm has enough resources to pay its debts over the next 12
months. Potential creditors use this ratio in determining whether or not to make short-term
short loans.
The current ratio can also give a sense of the efficiency of a company's operating cycle or its
ability to turn its product into cash. The current ratio is also known as the working capital ratio.

2500
2020 2019 2018 2017
2000

1500

1000 particulars
current Ratio
500
1.01
1.10
0 1.15
1.21
1
2
3
4

Current ratio graph shows that in 2017 it was 1.21 and 2018 it was 1.15 it means that in 2018
current assets are decreased and 2019 ratio 1.10 and 2020 ratio 1.01 it means that 2019 and 2020
current assets are decrease .2017
2017 is more liquid.

What is Quick Ratio?

The quick ratio is a financial
ncial indicator of short
short-term
term liquidity or the ability to raise cash to pay
bills due in the next 90 days. It is defined as: quick assets divided by current liabilities, and it is
also known as the acid-test
test ratio and the quick liquidity ratio:
Crown cement LTD

Quick Ratio
2020-2019
2019-2018-2017
1.04 1.09
1.20
0.96
1.00 0.84
0.80
0.60 Quick Ratio
0.40
0.20
0.00
1 2 3 4

Quick ratio graph h show that in 2017 ratio was 1.09 it mean that in 2017 has quick assets are
current assets that can be converted very easily into cash
cash.1.09 shows that Company has enough
current assets to cover its current liabilities. For every $1 of current liability, the company has
$1.19 of quick assets to pay for it
it.

Inventory Turnover

Inventory turnover is a financial ratio showing how many times a company has sold and
replaced inventory during a given period. A company can then divide the days in the period by
the inventory turnover formula to calculate the days it takes to sell the inventory on hand.

Calculating inventory turnover can help businesses make better decisions on pricing,
manufacturing, marketing, and purchasing new inventory.
Crown cement LTD

Inventory Turnover
2020-2019
2019-2018-2017

12.00 10.37
9.78
10.00 7.99
8.00 7.04
Axis Title

6.00
4.00
2.00
0.00
1 2 3 4
Inventory Turnover 7.04 9.78 10.37 7.99

Inventory Turnover graph Show that in 2017 inventory turnover ratio is 7.99 and 2018 is 10.37
1 it
means that sales are increase market demand is high. In 2019 and 2020 sales and demand up and
down.2017 is favorable.

Fixed Asset Turnover

The fixed asset turnover ratio (FAT) is, in general, used by analysts to measure operating
performance. This efficiency ratio compares net sales (income statement) to fixed assets
asset (balance
sheet) and measures a company's ability to generate net sales from its fixed
fixed-asset
asset investments,
namely property, plant, and equipment (PP&E).

The fixed asset balance is used as a net oof accumulated depreciation.. A higher fixed asset
turnover ratio indicates that a company has effectively used investments in fixed assets to
generate sales.
Crown cement LTD

Fixed Asset Turnover

2020-2019
2019-2018-2017
Fixed Asset Turnover

1.67 1.74
1.54
1.25

1 2 3 4

In this graph 2017 ratio was 1.25 and 2018 ratio was 1.54 It indicates that there is greater efficiency
in regards to managing fixed assets; therefore, it gives higher returns on asset investments. And
2019 ratio was 1.74 2020 was 1.67 it mean that 2019 is favorable because it gives higher returns
on asset investments.

Total Asset Turnover

The asset turnover ratio measures the value of a company's sales or revenues relative to the value
of its assets. The asset turnover ratio can be used as an indicator of the efficiency with which a
company is using its assets to generate revenue.

The higher the asset turnover ratio, the more efficient a company is at generating revenue from
its assets. Conversely, if a company has a lo
loww asset turnover ratio, it indicates it is not efficiently
using its assets to generate sales.
Crown cement LTD

Total Asset Turnover

2020-2019
2019-2018-2017

0.73 0.76
0.80 0.64
0.53
0.60
0.40
0.20
0.00
1 2 3 4

Total Asset Turnover

In this graph show that in 2017 was 0.53 and 2018 was 0.64. The higher asset turnover ratio the
more efficient a company is at generating from its assets
assets. And 2019 was 0.76 2020 was 0.73
,2019 was favorable higher ratio was acceptable and favorable for company.

Total Debt Ratio

The debt ratio is a financial ratio that measures the extent of a company’s leverage.
leverage The debt
ratio is defined as the ratio of total debt to total assets
assets,, expressed as a decimal or percentage. It
can be interpreted as the proportion of a company’s assets that are financed by debt.

A ratio greater than 1 shows that a considerable portion of debt is funded by assets . In other
words, the company has more liabilities than assets. A high ratio also indicates that a company
may be putting itself at risk of default on its loans if interest rates were to rise suddenly. A ratio
below 1 translates to the fact that a greater po
portion
rtion of a company's assets is funded by equity.
Crown cement LTD

Total Debt Ratio

2020-2019
2019-2018-2017
63.91% 63.86%
64.00%
62.86%
63.00%
62.00%
61.00% 60.39%
Total Debt Ratio
60.00%
59.00%
58.00%
1 2 3 4

Long-Term Debt Ratio

Long term debt ratio is one of the financial leverage ratios measuring the proportion of long-term
long
debt used to finance the assets of a business. This ratio represents the position of the financial
leverage the company’s take. With this ratio, analysts can estimate the capability of the
corporation to meet its long-term
term outstanding loans.

Long term debt ratio—also

also known as long term debt to total assets ratio—is is often calculated
yearly, as most business balance sheets come out once in every fiscal year. Thus, we can
calculate the year-on-year
year results of a company’s long
long-term
term debt ratio to determine the leverage
trend.

If the ratio tends to rise as the year moves forward, it means that the business is becoming more
dependent on debt. On the contrary, a descending ratio shows that the company is less reliant on
debts over time.
Crown cement LTD

Long-Term
Term Debt Ratio
2020-2019
2019-2018-2017

16.00% 14.00% 13.67%

14.00% 12.67%
12.00% 9.32%
10.00%
8.00% Long-Term Debt Ratio
6.00%
4.00%
2.00%
0.00%
1 2 3 4

Debt to Equity

The debt-to-equity (D/E)

D/E) ratio is used to evaluate a company's financial leverage and is
calculated by dividing a company’s total liabilities by its shareholder equity.

The D/E ratio is an important metric used in corporate finance. It is a measure of the degree to
which a company is financing its operations through debt versus wholly owned funds. f More
specifically, it reflects the ability of shareholder equity to cover all outstanding debts in the event
of a business downturn. The debtdebt-to-equity ratio is a particular type of gearing ratio.

Debt to Equity
2020-2019
2019-2018-2017
177.11% 176.71%
180.00%
175.00% 169.23%
170.00%
165.00%
160.00% Debt to Equity
152.46%
155.00%
150.00%
145.00%
140.00%
1 2 3 4
Crown cement LTD

Gross profit Margin

Gross profit margin is a metric analysts use to assess a company's financial health by calculating
the amount of money left over from product sales after subtracting the cost of goods
sold (COGS). Sometimes referred to as the gross margin ratio, gross profit margin is frequently
expressed as a percentage of sales.

Gross profit Margin

2020-2019
2019-2018-2017
189.75%
190.00%
188.00% 186.81% 186.91%

186.00%
184.00% 182.94%
Gross profit Margin
182.00%
180.00%
178.00%
1 2 3 4

Operating profit Margin

A company's operating profit margin ratio tells you how well the company's operations
contribute to its profitability. A company with a substantial profit margin ratio makes more
money on each dollar of sales than a company with a narrow profit ma
margin.

You can find the inputs you need for calculating a company's operating profit margin on
its income statement.
Crown cement LTD

Operating profit Margin

2020-2019
2019-2018-2017
185.27%
186.00%
184.00% 181.66% 181.80%
182.00%
180.00% 177.64%
178.00% Operating profit Margin
176.00%
174.00%
172.00%
1 2 3 4

Net profit margin

The net profit margin, or simply

ply net margin, measures how much net income or profit is
generated as a percentage of revenue. It is the ratio of net profits to revenues for a company or
business segment. Net profit margin is typically expressed as a percentage but can also be
represented in decimal form. The net profit margin illustrates how much of each dollar in
revenue collected by a company translates iinto profit.

Net profit margin

2020-2019
2019-2018-2017
200.00% 178.55% 175.33% 172.88%

150.00%

100.00%
Net profit margin
50.00%

0.00%
1 2 -0.74%
3 4
-50.00%

In this graph show that 2017 ratio

atio was 172.88% and 2018 ratio was -0.74%
0.74% that means 2017
better than 2018 A higher net profit margin means that a company is more efficient
effici at converting
Crown cement LTD

sales into actual profit. Under gross profit, fixed costs are excluded from calculation.2019
calculation ratio
was 175.33% and 2020 ratio was 178.55% 20 2020 was better and favorable.

Return on Total Asset

Return on total assets (ROTA) is a ratio that measures a company's earnings before interest and
taxes (EBIT) relative to its total net assets. It is ddefined
efined as the ratio between net income and total
average assets, or the amount of financial and operational income a company receives in a
financial year as compared to the average of that company's total assets.

The ratio is considered to be an indicator of how effectively a company is using its assets to
generate earnings. EBIT is used instead of net profit to keep the metric focused on operating
earnings without the influence of tax or financ
financing
ing differences when compared to similar
companies.

Return on Total Asset

2020-2019
2019-2018-2017
129.82% 133.04%
140.00%
120.00%
91.07%
100.00%
80.00%
60.00% Return on Total Asset
40.00%
20.00%
0.00%
-20.00% 1 2 -0.47%
0.47%
3 4

Just like
ike other variations of rate of return, the higher the return on assets the better. A high return
on assets means than the business was able to utilize its resources well in generating income.
income
Here 2019 ROA is better and acceptable.

Return on Equity
Crown cement LTD

Return on equity (ROE) is a measure of financial performance calculated by dividing net

income by shareholders' equity.. Because shareholders' equity is equal to a company’s assets
minus its debt, ROE is considered the return on net assets.. ROE is considered a measure of the
profitability of a corporation in relation to stockholders’ equity.

Return on Equity
2020-2019
2019-2018-2017

359.75% 358.19%
400.00%

300.00% 229.93%

200.00% Return on Equity

100.00%

0.00%
-1.31%
1 2 3 4
-100.00%

A high ROE suggests that a company’s management team is more efficient when it comes to
utilizing investment financing to grow their busine
business
ss (and is more likely to provide better returns
to investors). A low ROE, however, indicates that a company may be mismanaged and could be
reinvesting earnings into unproductive assets.
assets.2020
2020 ratio was favorable for this company.

Du Pont Analysis of ROE

The DuPont analysis (also known as the DuPont identity or DuPont model) is a framework for
analyzing fundamental performance popularized by the DuPont Corporation. DuPont analysis
is a useful technique used to decompose the different drivers of return on equity (ROE).
(ROE) The
decomposition of ROE allows investors to focus on the key metrics of financial performance
individually to identify strengths and weaknesses.
Crown cement LTD

Du pont Analysis of ROE

2020-2019
2019-2018-2017
80.00% 65.91% 70.19%
60.00%
30.68%
40.00%
20.00%
Du pont Analysis of ROE
0.00%
-20.00% 1 2 3 4
-40.00%
-60.00%
-80.00% -64.33%
64.33%

What Is a Z-Score?
A Z-score
score is a numerical measurement that describes a value's relationship to the mean of a
group of values. Z-score
score is measured in terms of standard deviations from the mean.
m If a Z-score
is 0, it indicates that the data point's score is identical to the mean score. A Z
Z-score
score of 1.0 would
indicate a value that is one standard deviation from the mean. Z Z-scores
scores may be positive or
negative, with a positive value indicating th thee score is above the mean and a negative score
indicating it is below the mean.
Crown cement LTD

Z- Score below 2.675 can reasonably be expected to experience severe financial

distress, and possibly bankruptcy. In my company z score from 2020 to 2017
respectively was 1.01, 1.18, 1.05, 1.01. It means my company position was in financial
distress, and possibly bankruptcy.