COMMENT THE COMPANY PERFORMANCE AS

COMPARED TO INDUSTRY AVERAGE

Based on the performance schedule above, it appears that Farm Fresh are overseeing a
downward trend, compared to 2021 statistic, which notices an upward trend. Although, the
Operating Profit Margin is higher, with 13%, higher than the year 2021 of 12.26%. And even
then, Net Profit Margin only shows a little increase of 15.36% compared to the year 2021 of
14.85%. This shows that Farm Fresh will continue to see an increase in Gross Profit Margin
and Net Profit Margin, in the next following years.

Meanwhile, Return on Asset have a lower margin of 7.63% in 2022, compared to the year
2021 of 9.63%. Next, Return on Equity also seeing a huge decrease of 12.63% in 2022,
compared to the year 2021 of 17.81%. This trend might have to do with the current economic
situation in Malaysia, which many sectors and stocks are dropping, due to lack of cash flow
from citizens, exports and imports from the government.

POSSIBLE CAUSES-WHY UNDER/ ABOVE OR SAME

Current ratio
A current ratio that is lower than the industry average may indicate a higher risk of
distress or default. Similarly, if a company has a very high current ratio compared with its peer
group, it indicates that management may not be using its assets efficiently. A decline in this
ratio can be attributable to an increase in short-term debt, a decrease in current assets, or a
combination of both. Regardless of the reasons, a decline in this ratio means a reduced ability
to generate cash.A low current ratio of less than 1.0 might suggest that the business is not well
placed to pay its debts. It might be required to raise extra finance or extend the time it takes to
pay creditors. However, this very much depends on the nature of the business.

Acid test ratio

Acid test ratio which is lower than the industry average may suggest that the company
is taking too much risk by not maintaining an appropriate buffer of liquid resources.
Alternatively, a company may have a lower quick ratio due to better credit terms with
suppliers than the competitors.A low or decreasing acid test ratio generally suggests that a
company is struggling to maintain or grow sales, paying their bills too