qwertyuiopasdfghjklzxcvbnmqwe

rtyuiopasdfghjklzxcvbnmqwertyu
iopasdfghjklzxcvbnmqwertyuiopa
sdfghjklzxcvbnmqwertyuiopasdfg
hjklzxcvbnmqwertyuiopasdfghjkl
zxcvbnmqwertyuiopasdfghjklzxcv
bnmqwertyuiopasdfghjklzxcvbnm
qwertyuiopasdfghjklzxcvbnmqwe
rtyuiopasdfghjklzxcvbnmqwertyu
iopasdfghjklzxcvbnmqwertyuiopa
sdfghjklzxcvbnmqwertyuiopasdfg
hjklzxcvbnmqwertyuiopasdfghjkl
zxcvbnmqwertyuiopasdfghjklzxcv
bnmqwertyuiopasdfghjklzxcvbnm
qwertyuiopasdfghjklzxcvbnmqwe



Financial Analysis of Pakistan Cables

Submitted to : Sir Shahbaz

9/10/2014

Ali Raza M.Com 3rd






Pakistan Cables Limited

Pakistan Cables Limited is the countrys oldest cables manufacturer engaged in
manufacturing of wires and cables and other engineering products.
The Company was established in 1953 in collaboration with BICC, United Kingdom.
The Company manufactures General Wiring Cables in the range of 250/750 volts.
These cables manufactured in conformity with national and international
standards that provides safety and saving in electricity consumption because of the
use of pure copper and cable grade PVC (Plastic Compound Vanile).
The Company provides overhead conductors to the utility companies WAPDA and
KESC which are manufactured from EC grade Aluminum Rod and Copper Rod.
PCL also manufactures telephone, intercom, coaxial cables and various types of
special cables which include air field lighting, control cables, etc.
Alum-Ex is the brand name under which Pakistan Cables manufactures aluminum
sections for the construction and architectural industry.
PCL has also set up a plant to manufacture High Conductivity Oxygen Free 8mm
Copper Rod
Vision

To be the company of first choice for customers and partners for wires, cables and
other engineering products

Mission Statement
To strengthen company leadership in the manufacturing and marketing of wire
and cables. To have a strong presence in the engineering products market while,
retaining the options to participate in other profitable business.
To operate ethically while maximizing profits and satisfying customers needs and
stakeholders interest. To assist in the socio-economic development of Pakistan by
being good corporate citizens



Companys Products

General Wiring
For lighting & general use, Pakistan Cables manufactures General Wiring Cables in the range of
250/750 Volts conforming to BSS: 6004:95:
General wiring single core cables from 1 mm2 to 10 mm2
Larger single core cables from 16mm2 to 70mm2
Multi-core cables from 1 mm2 to 10 mm2
Flexible multi-core cables from 1 mm2 to 4 mm2
These cables are manufactured in conformity with the national & international standards that
provide safety and savings in electricity consumption because of the use of 99.99% pure copper,
cable grade PVC, and thorough quality testing of every meter


Low & Medium Voltage Cables

Pakistan Cables manufactures Low Voltage (LV) power cables up to 3.3 kV with PVC and XLPE
insulation and Medium Voltage (MV) cables up to15 kV with XLPE insulation.
All these cables are subjected to rigorous in-house quality checks. LV Cables have been Type
Tested by internationally recognized certifying body, KEMA Netherlands and MV Cables by
HV&SC Lab PEPCO, Rawat, Islamabad Pakistan.






With growing power demand in Pakistan, the use of overhead conductors for power
transmission purposes has increased. Pakistan Cables provides high quality overhead conductors
to Pakistans utility companies. These conductors are manufactured from EC grade Aluminium
Rod and Copper Rod made from LME Grade A Cu cathodes with 99.99% purity.


Auto Cables


In April 2008, Pakistan Cables began producing cables for the automobile industry in
Pakistan. These cables are used in the assembly of wire harnesses for OEMs (eg.
Toyota) and are manufactured under JIS (Japanese Industrial Standards) and JASO
specifications. Specifications include AV, AVS, AVSS and AVSSH. Pakistan Cables
Auto Cable plant has state of the art machines, including Niehoff wire drawing and
bunching machines and a Tecnocable extruder.















Companys Performance Charts

































Companys Key Financial Figures



2012-
2013
2011-
2012
2010-
2011
2009-
2010
2008-
2009
2007-
2008
2006-
2007

Rs.
Millions
Rs.
Millions
Rs.
Millions
Rs.
Millions
Rs.
Millions
Rs.
Millions
Rs.
Millions
Financial Results
Sales 6,164.6 5,344.6 4,096.4 3,798.8 3,352.3 3,794.9 4,168.9
Gross Profit 707.0 687.6 519.6 412.3 532.4 369.9 614.2
Operating Profit 349.0 348.4 250.7 197.7 350.9 7.0 390.5
Profit before tax 266.0 240.9 146.7 52.3 101.8 53.6 293.3
Profit after tax 177.0 139.9 85.7 45.5 63.9 65.4 194.3
EBITDA 478.2 430.6 361.0 323.1 432.4 257.0 464.7
Dividend 113.9 92.5 56.9 32.2 48.3 - 54.8
Bonus Issue - - - - - 19.5 48.8
Capital expenditure 33.0 35.9 34.2 30.2 169.9 338.4 280.0
Fixed assets at cost/revaluation 2,302.4 2,285.0 2,254.0 2,218.0 2,192.0 1,776.4 1,429.6
Current assets less current liabilities 958.6 816.7 569.7 41.4 78.7 2.7 142.6

Cash Flow From:
Operating activities
114.5 496.8 (4.0) (562.4) 630.2 31.8 (345.4)
Investing activities (24.4) 26.7 (27.3) (25.2) (164.9) (246.8) (270.4)
Financing activities (84.7) (625.9) 357.8 556.8 (58.5) (448.5) 353.7
Cash and cash equivalents (108.5) (113.9) (11.6) (338.0) (307.2) (714.0) (50.4)

Shareholders' funds
Issued capital 284.6 284.6 284.6 214.6 214.6 195.1 146.3
Reserve & retained earning 1,265.0 1,176.2 1,088.9 504.2 503.6 455.9 456.4
Total Shareholders' fund 1,549.6 1,460.8 1,373.5 718.8 718.2 651.0 602.7
Surplus on revaluation of fixed assets 688.7 691.6 695.8 680.8 684.2 687.6 549.0
Long term Loans & Liabilities 148.5 182.7 199.3 394.5 510.0 378.2 259.0
Net Assets employed 2,386.8 2,335.1 2,268.7 1,794.2 1,912.4 1,716.8 1,410.7

Liquidity
Current Ratio 1.8:1 1.6:1 1.4:1 1:1 1.1:1 1:1 1.1:1
Acid Test Ratio 0.9:1 0.7:1 0.5:1 0.5:1 0.4:1 0.4:1 0.4:1

Financial Gearing
Financial Leverage 38:62 42:58 46:54 62:38 53:47 60:40 61:39
Debt to equity ratio 06:94 08:92 09:91 22:78 27:73 22:78 18:82



Interest coverage (Times) 4.1 4.6 2.5 1.3 1.4 1.4 3.6

Capital efficiency
Debtor turnover (Times) 7.0 7.5 8.6 6.0 10.4 9.6 8.3
Inventory turnover (Times) 5.4 3.7 2.7 3.4 4.3 3.4 3.1
Total assets turnover (Times) 1.7 1.5 1.1 1.0 1.1 1.1 1.4
Creditor turnover (Times) 99.2 16.8 96.7 15.1 14.1 36.2 15.3
Operating Cycle No. of days 116.0 125 174 144 94 135 138
Fixed asset turn over (Times) 4.4 3.6 2.6 2.3 2.0 2.3 3.4
Capital employed turnover (Times) 2.6 2.3 1.8 2.1 1.8 2.2 2.9

Profitability
Gross profit % 11.5 12.9 12.7 10.9 15.9 9.7 14.7
Net profit % 2.9 2.6 2.1 1.2 1.9 1.7 4.7
EBITDA margin % 7.8 8.1 8.8 8.5 12.9 6.8 11.1
Return on capital employed (excl. revaulation
surplus) %
20.7 18.8 15.4 18.5 27.0 17.9 47.0
Return on capital employed (incl. revaulation
surplus) %
14.8 13.2 10.7 11.5 17.4 10.7 28.7
Return on Equity % 11.4 9.6 6.3 6.3 8.9 10.0 32.2
Return on total assets % 4.9 3.8 2.3 1.2 2.1 1.9 6.5

Investment
Price earning ratio 10.4 7.8 13.7 25.5 11.4 36.4 20.2
Earning per rupee of sales Rs. 0.03 0.03 0.02 0.01 0.02 0.02 0.05
Earning per share Rs. 6.22 4.92 3.34 2.12 2.98 3.35 13.28
Cash dividend per share Rs. 4.00 3.25 2.0 1.50 2.25 - 3.75
Bonus issue per share Rs. - - - - - 1.00 3.33
Dividend (cash+bonus) yield %* 6.17 8.52 4.39 2.78 6.61 10.00 34.70
Dividend payout % 64.3 66.1 66.3 70.7 75.6 29.8 53.3
Dividend Cover (Times) 1.6 1.5 1.5 1.4 1.3 3.4 1.9
Market value per share Rs. 64.8 38.2 45.6 54.0 34.0 122.0 267.9
Market value per share high during the year Rs. 82.0 47.3 68.9 63.0 120.8 276.0 273.2
Market value per share low during the year Rs. 38.7 31.0 45.6 34.2 27.8 122.0 162.0
Break-up value per share including surplus on
revaluation Rs.
78.6 75.6 72.7 65.2 65.3 68.6 78.7
Break-up value per share excluding surplus on
revaluation Rs.
54.4 51.3 48.3 33.5 33.5 33.4 41.2

Value addition and its distribution
Employees as remuneration 372.1 333.7 295.4 251.8 239.8 229.2 204.6
Government as taxes 1,169.8 1,008.3 846.0 708.7 582.7 698.7 838.1
Shareholders as dividends 113.9 92.5 56.9 32.2 48.3 19.5 103.6
Provider of Finance 86.0 67.7 95.9 154.5 230.0 130.3 112.1
Society 4.1 3.2 2.0 0.2 1.5 1.0 5.3
Retained within the business 67.5 51.5 32.5 16.5 19.0 58.0 93.0



Financial Analysis 2012-2013

Balance Sheet (Horizontal Analysis)

Particulars

2013 2012
Horizontal
Analysis
Equity & Liabilities


Share capital and reserves
Share capital 284623 284623 0.00%
share premium reserve 527800 527800 0.00%
general reserve 555500 504000 0.00%
unappropriated profit 181703 144420 10.22%
surplus on revaluation of land and building 688728 691554 25.82%
Total Equity 2238354 1460843 53.22%
Non current liabilities 2238354 3613240
long term loans 0 3125 -100.00%
defferd liabilities for staff gratuity 26871 23334 15.16%
other long term employee benefits 15779 14555 8.41%
deffered tax liablity-net 105805 141734 -25.35%
total non current liabilities 148455 182478 -18.64%
Current liabilities
current portion of long term loans 3125 23750 -86.84%
trade and other payables 619809 768664 -19.37%
short term borrowing 575790 544685 5.71%
mark up accured on bank borrowings 6533 6913 -5.50%
total current liabilities 1205257 1344012 -10.32%

Total equity & liabilities 3592066 3679157 -2.37%

Assests
Non current assets
Property,Plant & Equipemnt 1401668 1495289 -6.26%
Investments in associates 19766 18405 7.39%



long term loans 3613 2201 64.15%
Long term security deposits 3184 2567 24.04%
Total non current assests 1428231 1518462 -5.94%
Current assests
Stores and spares 34058 26953 26.36%
Stock in trade 1011004 1246909 -18.92%
Trade debts 878367 715687 22.73%
Short term loand and advances 17821 6848 160.24%
Short term depostis and prepayments 6854 6839 0.22%
Other receiveables 25424 4712 439.56%
Advance tax net of provisions 178936 147655 21.19%
Cash and bank balances 11371 5092 123.31%
Total current assets 2163835 2160695 0.15%

Total Assets 3592066 3679157 -2.37%



















Balance Sheet (Vertical Analysis)

Particulars 2013 2012
Vertical
Analysis
Equity & Liabilities


Share capital and reserves
Share capital 284623 284623 7.92%
share premium reserve 527800 527800 14.69%
general reserve 555500 504000 14.69%
unappropriated profit 181703 144420 15.46%
surplus on revaluation of land and building 688728 691554 5.06%
Total Equity 2238354 1460843 62.31%
Non current liabilities 2238354 3613240
long term loans 0 3125
defferd liabilities for staff gratuity 26871 23334 0.75%
other long term employee benefits 15779 14555 0.44%
deffered tax liablity-net 105805 141734 2.95%
total non current liabilities 148455 182478 4.13%
Current liabilities
current portion of long term loans 3125 23750 0.09%
trade and other payables 619809 768664 17.25%
short term borrowing 575790 544685 16.03%
mark up accured on bank borrowings 6533 6913 0.18%
total current liabilities 1205257 1344012 33.55%

Total equity & liabilities 3592066 3679157

Assests
Non current assets
Property,Plant & Equipemnt 1401668 1495289 39.02%
Investments in associates 19766 18405 0.55%
long term loans 3613 2201 0.10%
Long term security deposits 3184 2567 0.09%



Total non current assests 1428231 1518462 39.76%
Current assests
Stores and spares 34058 26953 0.95%
Stock in trade 1011004 1246909 28.15%
Trade debts 878367 715687 24.45%
Short term loand and advances 17821 6848 0.50%
Short term depostis and prepayments 6854 6839 0.19%
Other receiveables 25424 4712 0.71%
Advance tax net of provisions 178936 147655 4.98%
Cash and bank balances 11371 5092 0.32%
Total current assets 2163835 2160695 60.24%

Total Assets 3592066 3679157 100.00%



















Profit & Loss Account (Horizontal Analysis)

Particulars 2013 2012
Vertical
analysis
Net sales 6164555 5344571 100.00%
Cost of sales 5457538 4656976 88.53%
Gross profit 707017 687595 11.47%
Selling cost 223860 189255 3.63%
Admin expenses 123726 106639 2.01%
347586 295894 5.64%
359431 391701 5.83%
Other operating expenses 25687 58993 0.42%
Other income 15255 15734 0.25%
10432 43259 0.17%
Operating Profit 348999 348442 5.66%
Finance expenses 86042 67704 1.40%
Share of profit from associates 3088 8218 0.05%
Impairment loss on investments
profit before income tax 266045 240956 4.32%
Taxation 89063 101000 1.44%
profit for the year 176982 139956 2.87%





Profit & Loss Account (Vertical Analysis)

Particulars 2013 2012
Horizontal
analysis
Net sales 6164555 5344571 15.34%
Cost of sales 5457538 4656976 17.19%
Gross profit 707017 687595 2.82%
Selling cost 223860 189255 18.28%
Admin expenses 123726 106639 16.02%
347586 295894 17.47%
359431 391701 -8.24%
Other operating expenses 25687 58993 -56.46%
Other income 15255 15734 -3.04%
10432 43259 -75.88%
Operating Profit 348999 348442 0.16%
Finance expenses 86042 67704 27.09%
Share of profit from associates 3088 8218 -62.42%
Impairement loss on investments
profit before income tax 266045 240956 10.41%
Taxation 89063 101000 -11.82%
profit for the year 176982 139956 26.46%






Ratio Analysis 2012-2013
Liquidity Ratios
1. Current Ratio

Years Current Assets Current Liabilities Current Ratio
2012 2,160,695 1,344,012 0.90
2013 2,163,835 1,205,257 1.80

2. Quick Ratio

Years Quick Assets Current Liabilities Quick Ratio
2012 2160695-26953 1,344,012 1.59
2013 2163835-34058 1,205,257 1.77

3. Inventory Turnover

Years Cost of Sales Average I nventory I nventory Turnover
2012 4,656,976 (24972+26953)/2 44.84
2013 5,457,538 (26953+34058)/2 44.73






4. Average Account Receivables Turnover

Years Credit Sales Average A/R A/R Turnover
2012 5,344,571 (17813+4712)/2 118.64
2013 6,164,555 (25424+4712)/2 102.28

Profitability Ratios

1. Assets Turnover

Years Sales Average Total Assets Assets Turnover
2012 5,344,571 (3679157+3807776)/2 0.36
2013 6,164,555 (3592066+3679157)/2 0.42

2. Profit Margin

Years Sales Cost of Goods Sold Profit Margin
2012 38 5 7.76
2013 65 6 10.42





3. Return on Assets

Years Net I ncome Average Total Assets Return on Assets
2012 139,956
3679157
3.8%
2013 176,982 3,592,066 4.9%


4. Return on Common Stockholders Equity

Years Net I ncome Average Stock
Holders Equity
Return on Stock
holders Equity
2012 139,956
1460843
9.58%
2013 176,982 1,549,626 11.42%


5. Earnings per Share

Years Net I ncome Average Shares
Outstanding
Earnings per Share
2012 139,956 2846000 4.92%
2013 176,982 2846000 6.22%






6. Payout Ratios

Years Dividends per
Share
Earnings per Share Payout Ratio
2012 3.25 4.92 66.1%
2013 4 6.22 64.3%


7. Price Earnings Ratio

Years Market Price of
Share
Earnings per Share Price Earnings
Ratio
2012 38 5 7.76
2013 65 6 10.42














Solvency Ratios


1. Debt to Assets Ratio

Years Total Debts Total Assets Debt to Assets Ratio
2012 1,827,000
3679157
0.40
2013 1,485,000 3,592,066 0.41




2. Times Interest Earned

Years Operating I ncome I nterest Expense Times I nterest Earned
2012 348,442 67,704 5.15
2013 348,999 86,042 4.06










Liquidity Ratios

The analysis of Pakistan Cabless financial statement shows that it has a high tendency to pay its
debts and to convert assets into liquid form within short intervals of time.
The current ratio of PTC remained between 0.90 1.80 in 2 years and it shows its ability
to pay short term liabilities.




The quick ratio of PTC ranged between 0.159 0.77 in 2 years. It shows the companys
ability to convert its current assets into liquid form (cash form) in order to meet current
liabilities.




On yearly basis from the year 2012 2013, we observed that the number of times the
total inventory or stock of the company was sold on the average of 2.25 times/year. It
shows the sales of the company are on a very large scale and also gives rise to the
company opportunity to generate huge profits in the long run.




Average Account Receivables Turnover shows that how many times a company is able to
recover the amount of credit sales to people. PTC has shown a high Accounts Receivables
turnover rate which shows its high liquidity transformation rate.










Profitability Ratios

Pakistan Tobacco Companies Profitability ratios clearly reflect its great ability to generate huge
profits and of generating dividends for its shareholders.
Average Assets turnover of the company ranges between 0.36-0.42 times in 2 yeasr. It
shows the generation of huge sales from the worth of assets of the company and in the
case of Pakistan Cables, it shows the firm's efficiency at using its assets in generating
sales or revenue - the higher the number the better.





The profit margin of PTC lies between 7.76% - 10.42% in 2 years. It measures the
percentage of each dollars of sales that results in net income. A higher profit margin
indicates a more profitable company that has better control over its costs compared to
its competitors.




The return on assets of PTC ranges among 3.8 to 4.9 according to preceding 2 years
record. An overall measure of profitability is return on assets. ROA gives an idea as to
how efficient management is at using its assets to generate earnings. This number tells
you what the company can do with what it has, i.e. how many rupees of earnings they
derive from each rupee of assets they control.












Return on common stockholders equity of PTC varies between 9.58 11.42 between the
years 2012 & 2013. Another widely used profitability ratio is return on common
stockholders equity. It measures profitability from common stockholders point of
view. Return on equity measures a corporation's profitability by revealing how
much profit a company generates with the money shareholders have invested.
Averaging ROE over the past 5-10 years can give you a better idea of the historical
growth.





Earnings per share are a measure of net income earned on each share of common stock.
PTCs earning per share of last 2 years lies among 4.92-6.22. The EPS formula does not
include preferred dividends for categories outside of continued operations and net
income. Earnings per share serve as an indicator of a company's profitability.




Payout ratio of this company ranges from 66.1-66.4. It measures the percentage of
earnings distributed in the form of cash dividends. The amount of earnings paid out in
dividends to shareholders. Investors can use the payout ratio to determine what
companies are doing with their earnings. Dividend payout ratio is the fraction of net
income a firm pays to its stockholders in dividend.




Price earnings ratio is an oft-quoted measure of the ratio of the market price of each
share of common stock to the earnings per share. It is also called its "P/E", or simply
"multiple". The P/E ratio is a vital ratio for investors. Basically, it gives us an indication of
the confidence that investors have in the future prosperity of the business. A P/E ratio of



1 shows very little confidence in that business whereas a P/E ratio of 20 expresses a
great deal of optimism about the future of a business. It is the valuation ratio of a
company's current share price compared to its per-share earnings.





SOLVENCY RATIOS

Solvency ratios measure the ability of a company to survive over a long period of time. It
provides a measurement of how likely a company will be to continue meeting its debt
obligations. Different countries use different methodologies to calculate the solvency ratio, and
have different requirements.
Debt to total assets ratio measures the percentage of total assets that creditors provide.
A metric used to measure a company's financial risk by determining how much of the
company's assets have been financed by debt. If the ratio is less than one, most of the
company's assets are financed through equity. If the ratio is greater than one, most of
the company's assets are financed through debt. Calculated by adding short-term and
long-term debt and then dividing by the company's total assets.




The average value of Times interest earned of Pakistan Cables is approximately 4.60 for
previous 2 years. IT PROVIDES COMPANYS ABILITY TO MEET interest payments as they
come due. Times interest earned (TIE) or interest coverage ratio is a measure of a
company's ability to honour its debt payments. The times interest earned lets the
creditor understand whether or not a company has sufficient income to cover its interest
payments requirements. It is calculated by taking a company's earnings before interest
and taxes (EBIT) and dividing it by the total interest payable on bonds and other
contractual debt.