1 Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery Limited

1
Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited
DEDICATION:
I would like to thank our professor,
Mr. MUHAMMAD ADIL:
Who was always there to help and guide me when I needed help.
His perceptive criticism kept me working to make this project more
full proof. I thank full to him for his encouraging and valuable
support. Working under him was an extremely knowledgeable and
enriching experience for me. I very thankful to him for all the value
addition and enhancement done to me.
No word can adequately express my overriding debts of gratitude
to my parents whose support me in all the way.
Above all I shall thank my friends who constantly encouraged and
blessed m so as to enable me to do this work successfully.
ACKNOWLEDGEMENT:
To him belong the dimension of the

heavens and the earth, it is he who
gives life and death and he has power
over all things.
(Al-Quran)
Executive summary:
For the purpose of my Financial Statement Analysis project,

I chose Atlas Battery. The purpose of this project and the whole analysis is to look at the
direction of the progress Of the company by comparing and compiling its past five years
data. The project starts off by Looking at the basic statements of the company such as Profit
and Loss Accounts, Balance Sheets and Cash Flow Statements. Later on in the project, some
important ratios such as cash flow ratios, liquidity ratios, solvency ratios, returns on capital
ratios and profit ratios will be used to get a more detailed insight of the operations of the
company. In the end the report will discuss the decisions that should be taken by banker as
well as an investor by keeping in mind the performance of the company for the last five
years. Two important facts should be kept in mind regarding the performance of the
company for the last five years. Firstly, Pakistan has been facing energy crisis and due to that
there has been tremendous increase in the demand of UPS and batteries that power these
UPS. Secondly, the number of vehicles on the road has also increased partly due to imports
from Japan and China and partly due to the general needs of the people. This increase in
demand for vehicles has increased the demand for its complimentary goods which includes
batteries as well.
Vision:
Mission And Core values;
COMPANY PROFILE
Atlas Battery Limited (the Company) was incorporated as a public limited company on
October19, 1966 and its shares are quoted on Karachi, Lahore and Islamabad Stock
Exchanges. The Companies engaged in manufacturing and sale of auto motive and
motorcycle batteries .The registered office and manufacturing facilities are located atD181, Central Avenue, S.I.T.E., Karachi.
10
11
12
13
14
Financial highlights:
2015
2014
2013
2012
Sales
15,961,413
12,242,719
8,875,114
7,217,116
5,868,260
Gross Profit
2,377,705
1,621,558
1,315,488
1,167,682
860,839
Operating Profit
1,627,386
1,148,793
884,014
759,545
562,616
Profit before Tax
1,480,711
1,022,768
824,068
689,649
525,101
Profit after Tax
1,013,924
741,150
582,886
486,014
354,502
Earnings Per Share - Basic & Diluted

(Rupees)
Shareholders' Equity
58.27
42.60
33.50
33.52
29.34
3,220,775
2,384,566 1,789,742
1,326,938
1,242,919
1,127,859
Property, Plant & Equipment - Net of 1,994,955

Revaluation Reserve
982,068
2011
954745
900503
Business Growth
Rs in millions
sales revenue
20,000,000
15,000,000
10,000,000
5,000,000
0
2015
2014
2013
2012
2011
sales revenue
gross profit
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
2015
2014
2013
2012
gross profit
15
2011
Operating Profit
2,000,000
1,500,000
1,000,000
500,000
0
2015
2014
2013
2012
2011
gross profit
Profit before Tax

2,000,000
1,500,000
1,000,000
500,000
0
2015
2014
2013
2012
2011
2012
2011
Profit before Tax
Profit after Tax

1,500,000
1,000,000
500,000
0
2015
2014
2013
Profit after Tax
Earnings Per Share

80
60
40
20
0
2015
2014
2013
2012
Earnings Per Share
16
2011
Six Years at Glance
YEARS
2015
2014
2013
2012
2011
2010
14.9
9.4
6.5
44.2
13.2
8.4
6.1
41.5
14.8
9.3
6.6
41.0
16.2
9.5
6.7
44.9
14.7
9.0
6.1
44.4
14.7
8.5
5.5
37.3
1,788.7
11.2
137.2
1,281.3
10.5
78.9
993.0
11.2
71.4
856.0
11.9
152.3
636.7
10.8
121.8
415.3
10.3
51.4
(%)
(%)
(%)
(Rs.)
(Rs.)
(Times)
(Rs.)
(High-Rs.)
(Low-Rs.)
46.0
29.7
18.8
58.27
58.27
12.1
703.5
965.0
441.0
42.9
29.0
13.9
42.60
42.60
10.6
450.0
479.0
288.0
46.0
29.7
16.0
40.15
33.50
8.4
338.0
355.0
200.0
51.5
32.1
18.5
40.22
33.52
5.0
201.7
241.5
160.0
55.0
31.4
17.0
35.21
29.34
6.2
217.0
235.9
131.0
49.9
25.9
14.7
26.52
22.10
6.8
181.0
237.0
138.0
(Rs.)
185.2
137.1
123.4
110.9
94.8
81.5
(Rs.)
196.4
147.1
135.4
125.3
112.1
102.3
(%)
(%)
(%)
(Times)
(%)
(%)
(%)
(Times)
(%)
(%)
120.0
1.7
4.9
20.6
79.4
1.7
4.9
20.6
79.4
100.0
2.2
4.3
23.5
76.5
2.2
4.3
23.5
76.5
100.0
20.0
3.6
3.3
29.9
70.1
3.0
4.0
24.9
75.1
100.0
20.0
5.9
3.4
29.8
70.2
5.0
4.0
24.9
75.1
100.0
20.0
5.5
2.9
34.1
65.9
4.6
3.5
28.4
71.6
100.0
20.0
6.6
2.2
45.2
54.8
5.5
2.7
37.7
62.3
(Times)
(Times)
(Times)
(Times)
(Times)
(Times)
3.0
9.3
6.2
116.5
14.2
4.9
2.3
9.5
5.1
110.1
12.0
5.0
2.4
7.8
6.3
92.3
11.0
4.6
2.7
7.1
7.5
71.5
13.6
4.9
2.8
7.1
7.7
61.8
13.5
5.2
2.7
5.8
6.8
42.6
9.8
4.6
Profitability Ratios
Gross profit
(%)
Profit before tax
(%)
Profit after tax
(%)
Return on capital employed
(%)
Earnings before interest, tax, depreciation
&amortization(EBITDA)
(Rs. In millions)
EBITDA Margin
(%)
Operating leverage
(%)
Return to Shareholders
Return on equity-before tax
Return on equity-after tax
Return on assets
Earnings per share(basic)
Earnings per share(diluted)
Price earning ratio
Market price-at yearend
Market price-during the period
Market price-during the period
Break-up value per share without
Surplus on revaluation
Break-up value per share with
Surplus on revaluation
Dividend
Cash dividend
Stock dividend
Dividend yield
Dividend cover
Dividend payout
Plough back ratio
Dividend yield(Cash)
Dividend cover(Cash)
Dividend payout(Cash)
Plough back ratio(Cash)
Asset Utilization
Total assets turnover
Fixed assets turnover
Inventory turnover
Trade debts turnover
Trade creditors turnover
Capital employed turnover
Operating Cycle
Inventory holding period
Trade debts collection period
Trade creditors payment period
Operating cycle
(No. of Days)
(No. of Days)
(No. of Days)
(No. of Days)
59
3
(26)
36
72
3
(30)
45
58
4
(33)
29
48
5
(27)
26
47
6
(27)
26
53
9
(37)
25
(Times)
(Times)
(Times)
(%)
(Times)
(Times)
(Times)
2.0
1.0
0.0
11.9
0.2
0.6
11.1
1.5
0.5
0.0
(3.9)
0.7
1.2
9.1
1.7
0.6
0.0
2.9
0.3
0.9
14.8
1.6
0.7
0.1
8.4
0.3
0.8
10.9
1.4
0.5
0.1
4.8
0.5
1.0
15.0
1.4
0.4
0.1
4.7
0.3
1.0
18.2
Liquidity/Leverage
Current ratio
Quick ratio
Cash to current liabilities
Cash flow from operations to sales
Financial leverage ratio
Total liabilities to equity
Interest coverage ratio
17
COMPANY FINANCIAL STATEMENT

Income statement
Atlas Battery
FOR THE YEAR ENDED JUNE 30,
2015
2014
2013
12,242,719
8,875,114
Cost of sales
15,961,413
13,583,708
-10,621,161
-7,559,626
Gross profit
2,377,705
1,621,558
1,315,488
1,167,682
860,839
Distribution cost
-449,347
-292,373
-235,264
-186,367
-165,053
Administrative expenses
-246,501
-189,754
-190,538
-151,495
-99,679
91,526
109,221
86,309
37,035
12,265
-145,997
-99,859
-91,981
-107,310
-45,756
1,627,386
1,148,793
884,014
759,545
562,616
-146,675
-126,025
-59,946
-69,896
-37,515
1,480,711
1,022,768
824,068
689,649
525,101
-466,787
-281,618
-241,182
-203,635
-170,599
1,013,924
741,150
582,886
486,014
354,502
-5,466
-1,982
1,137
1,749
654
-387
-3,717
-1,328
750
-1,010,207
739,822
583,636
486,014
354,502
33.52
29.34
Sales
Other income
Other expenses
Profit from operations
Finance cost
Profit before taxation
Taxation
Profit for the year
Other comprehensive income

Items that will not be reclassified
to profit or loss
Re-measurement of staff
retirement benefit obligations
Impact of deferred tax
Other comprehensive loss for
the year
Total comprehensive income
for the year
2012
2011
7,217,116 5,868,260
-6,049,434 5,007,421
Rupees
Earnings per share - basic and
diluted
18
58.27
42.6
33.5
Horizontal analysis of income statement:
(in Percentage)
Atlas Battery
FOR THE YEAR ENDED JUNE 30
2015
2014
2013
2012
272.00% 208.63% 151.24% 122.99%
Sales
2011
100%
Cost of sales
-231.48
-180.99
-128.82
-103.09
100
Gross profit
40.52
27.63
22.42
19.90
100
Distribution cost
-7.66
-4.98
-4.01
-3.18
100
-4.20
-3.23
-3.25
-2.58
100
1.56
1.86
1.47
0.63
100
Other expenses
-2.49
-1.70
-1.57
-1.83
100
27.73
19.58
15.06
12.94
100
Finance cost
-2.50
-2.15
-1.02
-1.19
100
25.23
17.43
14.04
11.75
100
Taxation
-7.95
-4.80
-4.11
-3.47
100
Profit for the year
17.28
12.63
9.93
8.28
100
-0.09
-0.03
0.02
0.00
0.03
0.01
-0.01
0.00
-0.06
-0.02
0.01
0.00
-17.21
12.61
9.95
8.28
100
0.00
0.00
0.00
0.00
100
Other income

Items that will not be reclassified to profit
Re-measurement of staff retirement benefit
Other comprehensive loss for the year
Total comprehensive income for the year
Earnings per share - basic and diluted
19
Vertical analysis of income statement:
(in Percentage)
Atlas Battery
2015
2014
2013
2012
2011
100
100
100
100
100
Cost of sales
-85.10
-86.75
-85.18
-83.82
-85.33
Gross profit
14.90
13.25
14.82
16.18
14.67
Distribution cost
-2.82
-2.39
-2.65
-2.58
-2.81
-1.54
-1.55
-2.15
-2.10
-1.70
0.57
0.89
0.97
0.51
0.21
Other expenses
-0.91
-0.82
-1.04
-1.49
-0.78
10.20
9.38
9.96
10.52
9.59
Finance cost
-0.92
-1.03
-0.68
-0.97
-0.64
9.28
8.35
9.29
9.56
8.95
-2.92
-2.30
-2.72
-2.82
-2.91
6.35
6.05
6.57
6.73
6.04
-0.03
-0.02
0.01
0.00
0.00
0.01
0.01
0.00
0.00
0.00
Other comprehensive loss for the year
-0.02
-0.01
0.01
0.00
0.00
Total comprehensive income for the year
-6.33
6.04
6.58
6.73
6.04
0.00
0.00
0.00
0.00
0.00
Sales
Other income

Taxation
Profit for the year
Items that will not be reclassified to profit or loss
Re-measurement of staff retirement benefit obligations
Earnings per share - basic and diluted
20
Balance sheet :
Rupees in ,, (000)
Atlas Battery
2015
2014
2013
2012
2011
Assets;
Non-current assets;
Property, plant and equipment
Intangible assets
1,994,955
1,416,705 1,155,854 1,127,859
900503
10,743
1,117
1,736
6129
1,103
1,227
10,555
6,832
517
13,777
13,916
657
719
605
1,432,965 1,168,802 1,135,410
907754
Investments
Long term loans
Long term deposits
Total non current assts
2,020,578
Current assets;
Stores, spares and loose tools
Stock-in-trade
Trade debts
110,788
1,608,783
88,665
57,818
43,594
30933
2,551,256 1,477,258
811,490
717004
131,810
142,345
79,987
112,423
89625
Loans and advances
27,727
25,875
3,497
2,682
2884
Deposits and prepayments
11,361
6,416
6,446
5,138
4847
918,737
824,925
711,544
436,291
204863
8,913
11,398
4,121
7,023
2317
Taxation - net
481,100
237,060
94,615
29,481
26488
Bank balances
78,318
6,089
33,055
48,191
93,952
1172913
Investments
Other receivables
Total current assets
3,377,537
3,894,029 2,468,341 1,496,313
Total assets
5,398,115
5,326,994 3,637,143 2,631,723 2,080,667
21
Balance sheet :
2015
2014
2013
2012
2011
EQUITY AND LIABILITIES;

Share Capital and Reserves;
Authorized capital
50,000,000 (2014: 50,000,000)
ordinary shares of Rs.10 each
500,000
500,000
500,000
500,000
500,000
Issued, subscribed and paid-up capital
173,998
173,998
144,998
120,832
100693
General reserve
2,027,500 1,477,500 1,067,500
727,500
497500
Unappropriated profit
1,019,277
478,606
356,552
Total equity
3,220,775 2,384,566 1,789,742 1,326,938
954745
Surplus on revaluation of leasehold

land;
733,068
577,244
193,886
173,786
173,786
173,786
173786
60,226
49,741
45,825
40,928
35,411
Deferred taxation
208,181
161,015
146,945
131,123
103,000
total
268,407
210,756
192,770
172,051
138,411
910,253
860,347
799,556
514,863
356874
86,647
55,319
53,488
21,066
3908
Liabilities;
Non-current liabilities
Staff retirement benefits
Current liabilities;
Trade and other payables
Sales tax payable - net
special exice duty
Accrued mark-up
13023
19,729
11,110
7,810
5222
709,763 1,622,491
616,691
415,209
434,698
Total current liability
1,715,047 2,557,886 1,480,845
958,948
813725
Total liabilities
1,983,454 2,768,642 1,673,615 1,130,999
952136
Total equity and liabilities
5,398,115 5,326,994 3,637,143 2,631,723 2,080,667
Short term borrowings
22
8,384
Horizontal analysis of Balance sheet:
(in percentage)
Atlas Battery
2015
2014
2013
2012
2011
Assets;
Non-current assets;
221.54
157.32
128.36
125.25
100
Intangible assets
175.28
18.22
28.32
0.00
100
213.35
237.33
2041.59 1321.47
100
2277.19
2300.17
108.60
118.84
100
222.59
157.86
128.76
125.08
100
358.15
286.64
186.91
140.93
100
Stock-in-trade
224.38
355.82
206.03
113.18
100
Trade debts
147.07
158.82
89.25
125.44
100
Loans and advances
961.41
897.19
121.26
93.00
100
234.39
132.37
132.99
106.00
100
Investments
448.46
402.67
347.33
212.97
100
Other receivables
384.68
491.93
177.86
303.11
100
Taxation - net
1816.29
894.97
357.20
111.30
100
Bank balances
83.36
6.48
35.18
51.29
100
Total current assets
287.96
332.00
210.45
127.57
100
Total assets
259.44
256.02
174.81
126.48
100
Investments
Long term loans
Long term deposits
Total
Current assets;
23
Horizontal analysis of Balance sheet:
(in percentage)
Atlas Battery
2015
2014
2013
2012
2011

Authorized capital
50,000,000 (2014: 50,000,000) ordinary shares of Rs.10
each
100.00
100.00
100.00
100.00
100
172.80
172.80
144.00
120.00
100
General reserve
407.54
296.98
214.57
146.23
100
Unappropriated profit
285.87
205.60
161.90
134.23
100
Total equity
337.34
249.76
187.46
138.98
100
Surplus on revaluation of leasehold land;
111.57
100.00
100.00
100.00
100
170.08
140.47
129.41
115.58
100
Deferred taxation
202.12
156.33
142.67
127.30
100
Total
193.92
152.27
139.27
124.30
100
255.06
241.08
224.04
144.27
100
2217.17 1415.53 1368.68
539.05
100
Liabilities;
special exice duty
100
Accrued mark-up
160.55
377.81
212.75
149.56
100
163.28
373.25
141.87
95.52
100
Total
210.76
314.34
181.98
117.85
100
Total liabilities
208.32
290.78
175.77
118.79
100
259.44
256.02
174.81
126.48
100
24
Vertical analysis of balance sheet:
(in percentage)
Atlas Battery
2015
2014
2013
2012
2011
Assets;
Non-current assets;
36.96
26.59
31.78
42.86
43.28
Intangible assets
0.20
0.02
0.05
0.00
0.29
Investments
0.00
0.00
0.00
0.00
0.00
Long term loans
0.02
0.02
0.29
0.26
0.02
Long term deposits
0.26
0.26
0.02
0.03
0.03
37.43
26.90
32.14
43.14
43.63
2.05
1.66
1.59
1.66
1.49
29.80
47.89
40.62
30.83
34.46
Trade debts
2.44
2.67
2.20
4.27
4.31
Loans and advances
0.51
0.49
0.10
0.10
0.14
0.21
0.12
0.18
0.20
0.23
17.02
15.49
19.56
16.58
9.85
Other receivables
0.17
0.21
0.11
0.27
0.11
Taxation - net
8.91
4.45
2.60
1.12
1.27
Bank balances
1.45
0.11
0.91
1.83
4.52
62.57
73.10
67.86
56.86
56.37
100
100
100
100
100
Current assets;
Stock-in-trade
Investments
Total assets
25
Vertical analysis of balance sheet:
(in percentage)
Atlas Battery
2015
2014
2013
2012
2011

Authorized capital
50,000,000 (2014: 50,000,000) ordinary shares of
Rs.10 each
3.22
3.27
3.99
4.59
4.84
General reserve
37.56
27.74
29.35
27.64
23.91
Inappropriate profit
18.88
13.76
15.87
18.19
17.14
Total equity
59.66
44.76
49.21
50.42
45.89
3.59
3.26
4.78
6.60
8.35
1.12
0.93
1.26
1.56
1.70
Deferred taxation
3.86
3.02
4.04
4.98
4.95
4.97
3.96
5.30
6.54
6.65
16.86
16.15
21.98
19.56
17.15
1.61
1.04
1.47
0.80
0.19
special exice duty
0.00
0.00
0.00
0.00
0.63
Accrued mark-up
0.16
0.37
0.31
0.30
0.25
13.15
30.46
16.96
15.78
20.89
31.77
48.02
40.71
36.44
39.11
36.74
51.97
46.01
42.98
45.76
100.00
100.00
100.00
100.00
Surplus on revaluation of leasehold land;

Liabilities;
Total liabilities
26
100.00
CASH FLOW STATEMENT

Cash flows from operating activities;
Adjustments for non-cash charges and other items:
Depreciation of operating fixed assets
Amortization of intangible assets
Provision for gratuity
Provision for compensated leave absences
Gain on sale of investments
Dividend income
Net change in fair value of investments at fair value through profit or loss
Gain on sale of operating fixed assets
Provision for doubtful debts
finance cost
Changes in working capital:
Increase) / decrease in current assets
Stock-in-trade
Trade debts
Loans and advances
Other receivables
sales tax net
Increase in current liabilities
Sales tax payable net
special exice duty payable net
Cash generated from operations

Finance cost paid
intrest receive
Income taxes paid (including tax deducted at source)
Gratuity paid
Compensated leave absences paid
Long term deposits - net
Long term loans net
Net cash generated from / (used in) operating activities - carried forward
Net cash generated from / (used in) operating activities - brought forward
Cash flows from investing activities
Purchases of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchases of intangible assets
sale proceeds from disposable intangibale assets
Investments acquired
Proceeds from sale of investments
Dividend received
Net cash used in investing activities
Cash flows from financing activities
Short term borrowings - net
Dividend paid
Net cash (used in) / generated from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents - at beginning of year
Cash and cash equivalents - at end of year
27
2015
1,480,711
2014
1,022,768
2013
824,068
2012
689,649
2011
525,101
159,221
2,094
7,241
13,759
-45,197
-1,876
-32,764
-335
797
146,675
1,730,326
130,343
2,269
6,197
4,981
-3,781
90,380
6,129
8,420
13,777
-8,235
67,972
6,130
8,144
6,612
-125
-78,657
-5,443
624
126,025
1,205,326
107,879
1,152
-68,821
-5,590
59,946
13,026
13,026
1,512
6,544
7,306
947,022
24,206
5,975
-6,379
-2,488
69896
862,975
37515
642,482
-22,123
942,473
9,738
-1,852
-4,945
2,485
-30,847
-1,073,998
-62,982
-22,378
30
-7,277
-14,224
-665,768
30,924
-815
-1,308
2,902
12,661
-94,486
-22798
202
291
4706
925,776
-1,197,452
-648,289
-134,740
-8,520
-185407
10,771
-534
1,081
-2,317
34958
-149,968
60,300
31,328
56,269
1,831
284,518
32,422
91,628
1,017,404
2,747,730
-158,020
58,100
-1,139,352
65,974
-117,406
316,940
-331,349
615,673
-56,646
135,795
17,158
-13023
139930
5190
868,165
-67,308
-661,912
-26,190
-3,358
139
124
1,898,513
1,898,513
-409,339
-7,592
-1,195
-3,361
-570
-473,489
-473,489
-290,881
-8,299
-2,495
-3,723
62
253,691
253,691
-171,742
-8,024
-7,887
-6315
-114
606775
606775
9067
-2023
-151991
490,491
-33,538
195
-168,309
-6,015
-1,613
0
-335
280876
280,876
-735,138
18,102
-11,720
-400,640
14,889
-1,650
-243,953
95,053
-2,888
-1,599,925
1,584,074
1,876
-742,731
-127,500
96,557
-380,842
180,000
-346,032
11,131
0
0
-410000
211,013
-217,946
8,298
-13,196
937
-192,459
-20,324
-418,344
-352,630
-533,888
-394042
-912,728
-170,825
-1,083,553
72,229
6,089
78,318
1,005,800
-140,933
864,867
-26,966
33,055
6,089
201,482
-117,679
83,803
-15,136
48,191
33,055
-19,489
-99159
-118648
-45,761
93952
48191
260,100
-82,851
177249
64,083
29869
93952
-11090
STATEMENT CHANGE IN EQUITY
28
RATIO
ANALYSIS
29
RATIO ANALYSIS
The term ratio analysis refers to the analysis of the financial statements in conjunction with the
interpretations of financial results of a particular period of operations, derived with the help of 'ratio'.
Ratio analysis is used to determine the financial soundness of a business concern.
Definition
Ratio analysis is the process of determining and interpreting numerical relationships based on financial
statements. A ratio is a statistical yardstick that provides a measure of the relationship between two
variables or figures. This relationship can be expressed as a percent or as a quotient.
Objectives of ratio analysis

These ratios have following objectives:
(1) Measuring the profitability: Profitability is the profit earning capacity of the business. This can be
measured by Gross Profit, Net Profit, Expenses and Other Ratios. If these ratios fall we can take corrective
measures.
(2) Determining operational efficiency: Operational efficiency of the business can be determined by
calculating operating / activity ratios.
(3) Measuring financial position: Short-term and long-term financial position of the business can be
measured by calculating liquidity and solvency ratios. In case of unhealthy short or long-term position,
corrective measures can be taken.
(4) Facilitating comparative analysis: Present performance can be compared with past performance to
discover the plus and minus points. Comparison with the performance of other competitive firms can also
be made.
(5) Indicating overall efficiency: Profit and Loss Account shows the amount of net profit and Balance
Sheet shows the amount of various assets, liabilities and capital. But the profitability can be known by
calculating the financial ratios.
(6) Budgeting and forecasting: Ratio analysis is of much help in financial forecasting and planning.
Ratios calculated for a number of years work as a guide for the future. Meaningful conclusions can be
drawn for future from these ratios.
30
SHORT TERM SOLVENCY OR LIQUIDITY RATIOS

Short-term Solvency Ratios attempt to measure the ability of a firm to meet its short-term financial
obligations. In other words, these ratios seek to determine the ability of a firm to avoid financial distress in
the short-run. The two most important Short-term Solvency Ratios are the Current Ratio and the Quick
Ratio. (Note: the Quick Ratio is also known as the Acid-Test Ratio.)
Working capital
Working capital is the capital of a business which is used in its day-to-day trading operations, calculated
as the current assets minus the current liabilities.
Formula
Current Assets Current Liabilities
Data
2015
2014
2013
2012
2011
1172913
Current asset
3,377,537
3,894,029 2,468,341 1,496,313
Current liability
1,715,047
2,557,886 1,480,845
958,948
813725
working capital
1,662,490
1,336,143
987,496
537,365
359188
Graph:
2000000
1,662,490
1,336,143
1500000
987,496
1000000
500000
537,365
359188
0
2011
2012
2013
2014
2015
Working capital
Interpretation
The working capital of this company is 359188 in 2011.an it increased 537365 in 2012 and also increased
in 2013, 2014 and in 2015 working capital is increased 1662490 which is satisfactory for this company.
31
Current ratio
The current ratio is a liquidity ratio that measures a company's ability to pay short-term and long-term
obligations. To gauge this ability, the current ratio considers the current total assets of a company (both
liquid and illiquid) relative to that company's current total liabilities.
Formula
Current Assets Current Liability
Data
2015
2014
2013
2012
2011
Current asset
3,377,537
3,894,029
2,468,341
1,496,313
1172913
Current liability
1,715,047
2,557,886
1,480,845
958,948
813725
1.97
1.52
1.67
1.56
1.44
Current Ratio
Graph:
1.97
2
1.8
1.6
1.67
1.56
1.44
1.52
1.4
1
1.2
1
0.8
0.6
0.4
0.2
0
2011
2012
2013
current assets
2014
2015
Current liability
Interpretation
The standard norm for current ratio is 1:1. During the year 2011 the current ratio is 1.44 and During the
year 2012 the ratio is increased to 1.56 and it has increased to 1.67 during the y ear 2013 and decreased to
1.52 in 2014 and it is increased to 1.97 in the year 2014-15. The ratio above was standard except in the
year 2011. So the ratio was satisfactory.
32
Acid test/quick ratio/liquid ratio

The quick ratio or acid test ratio is a liquidity ratio that measures the ability of a company to pay
its current liabilities when they come due with only quick assets. Quick assets are current assets that can
be converted to cash within 90 days or in the short-term.
Formula
Quick assets or liquid assets Current Liability
Quick assets or liquid assets = Current assets stock prepaid expenses
Data
Current asset
Current liability
2015
2014
2013
2012
3,377,537 3,894,029 2,468,341 1,496,313
958,948
1,715,047 2,557,886 1,480,845
Inventories
1,608,783 2,551,256 1,477,258
811,490
717004
Prepaid expenses
Liquid assets
Acid Test Ratio
2011
1172913
813725
481,100
237,060
94,615
29,481
26488
1,287,654
1,105,713
896,468
655,342
429,421
0.75
0.43
0.61
0.68
0.53
Graph
1
1
0.68
0.8
0.53
0.6
0.75
0.61
0.43
0.4
0.2
0
2011
2012
2013
assets
2014
2015
liability
Interpretation
The standard norm for quick ratio is 1:1. During the year 2011 the current ratio is 0.53 and During the
year 2012 the ratio is increased to 0.68 and it has decreased to 0.61 during the y ear 2013 and decreased to
0.43 in 2014 and it is increased to 0.75 in the year 2014-15. The ratio below the standard in all the year.
So the ratio was not satisfactory.
33
Cash Ratio
The cash ratio is the ratio of a company's total cash and cash equivalents to its current liabilities. The cash
ratio is most commonly used as a measure of company liquidity.
Formula
Cash and cash equivalent Current liability
Data
2013
2012
2011
1,715,047 2,557,886 1,480,845
958,948
813725
2015
Current liability
Cash and cash equivalents
Cash Ratio
2014
78,318
6,089
33,055
48191
93952
0.05
0.00
0.02
0.05
0.12
Graph
1
1
0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.12
0.05
0.1
0.02
0.05
0
2011
2012
2013
cash and cash equivalent
2014
2015
liability
Interpretation
The standard norm for cash ratio is 1:1. During the year 2011 the current ratio is 0.12 and During the year
2012 the ratio is decreased to 0.05 and it has more decreased to 0.02 during the year 2013 and decreased
to 0.00 in 2014 and it is decreased to 0.05 in the year 2014-15. The ratio was below the standard in all the
year. So the ratio was not satisfactory in all the year.
34
LONG TERM SOLVENCY RATIOS

Solvency refers to an enterprise's capacity to meet its long-term financial commitments. Liquidity refers to
an enterprises ability to pay short-term obligations; the term also refers to its capability to sell assets
quickly to raise cash.
Debt Ratio or Debt assets

Another leverage measure, this ratio measures the percentage of a companys assets that have been
financed with debt (short-term and long-term). A higher ratio indicates a greater degree of leverage, and
consequently, financial risk.
Formula
Total liability Total assets
Data
2015
2012
2011
Total liabilities
1,983,454 2,768,642 1,673,615 1,130,999
952136
Total assets
5,398,115 5,326,994 3,637,143 2,631,723 2,080,667
Debt Ratio
2014
0.37
2013
0.52
0.46
0.43
0.46
Graph
1
1
0.8
0.6
0.46
0.43
0.52
0.46
0.37
0.4
0.2
0
2011
2012
2013
liability
2014
2015
assets
Interpretation
This ratio gives results relating to the capital structure of a firm. Debt ratio is 0.46 in the year 2011 it
decreased to 0.43 & 0.46 in the corresponding years 2012 & 2013. A gain it is increased to 0.52 &
decreased to 0.37 in the year 2014 & 2015. From the above in fluctuating trend we can conclude that the
companys dependence on debt is increasing. It is not better position in collection of debt.
35
Debt to equity ratio

This ratio indicates the degree of financial leverage being used by the business and includes both shortterm and long-term debt. A rising debt-to-equity ratio implies higher interest expenses, and beyond a
certain point it may affect a companys credit rating, making it more expensive to raise more debt.
Formula
Total liability or total long term liability total equity
Data
2015
2012
2011
Total liabilities
1,983,454 2,768,642 1,673,615 1,130,999
952136
Total equity
3,220,775 2,384,566 1,789,742 1,326,938
954745
Debt to Equity
2014
0.62
2013
1.16
0.94
0.85
1.00
Graph
1.16
1.2
0.94
0.85
0.8
0.62
0.6
0.4
0.2
0
2011
2012
2013
liability
2014
2015
equity
Interpretation
The ratio gives results relating to the capital structure of a firm. Debt equity ratio is 1.00 in the year 2011
and it decreased to 0.85 & 0.94 in the year 2012 and 2013. In the year 2014 the ratio has increased to 1.16
at this company in satisfactory position. And in 2015 debt equity ratio again decreased to 0.62.We can
conclude that the company depends on the debt fund is increasing. Company not in a satisfactory position.
36
Time interest earned

This ratio measures the companys ability to meet the interest expense on its debt with its operating
income, which is equivalent to its earnings before interest and taxes (EBIT).The higher the ratio, the better
the companys ability to cover its interest expense.
Formula
EBIT Finance cost or interest expenses
Data
2015
2014
2013
2012
2011
EBIT
1,627,386
1,148,793
884,014
759,545
562,616
Finance cost
-146,675
-126,025
-59,946
-69,896
-37,515
-11.09
-9.11
-14.74
-10.86
-14.99

Graph
2
0
2011
-2
2012
2013
2014
2015
-4
-6
-8
-9.11
-10
-10.86
-12
-11.09
-14
-16
-14.99
-14.74
EBIT
finance cost
Interpretation
Interest coverage ratio is -14.99 in the year 2011. It is increased automatically to -10.86 in the year 2012.
But, it is decreased to -14.74 in the year 2013 and increased to -9.11 in the year 2014 and it again
decreased to -11.09 in the year 2015. In this position outside investors are not interested to invest the
money in this company .Therefore the company interest coverage ratio is in negative .
37
ACTIVITY RATIOS
Activity ratios are accounting ratios that measure a firm's ability to convert different accounts within its
balance sheets into cash or sales. Activity ratios are used to measure the relative efficiency of a firm based
on its use of its assets, leverage or other such balance sheet items.
Inventory turnover ratio
The inventory turnover ratio is an efficiency ratio that shows how effectively inventory is managed by
comparing cost of goods sold with average inventory for a period. This measures how many times
average inventory is "turned" or sold during a period.
Formula
Cost of goods sold Average Inventory
Data
2015
2014
2013
2012
2011
13,583,708 10,621,161 7,559,626 6,049,434 5,007,421
Cost of sales
Stock-in-trade
1,608,783
2,551,256 1,477,258
8.44
42.27
5.11
811,490
717004
7,45
6,98
Graph
42.27
50
40
30
20
6.98
7.45
10
8.44
5.11
0
2011
2012
2013
2014
2015
Inentory turnover ratio
Interpretation
Inventory turnover ratio is 6.98 Times in the year 2011.But, it is increased to 7.45 in the
Year 2012. Then, it is decreased to 5.11 in the year 2013 and again increased to 42.27 in the year
2014. But, it is decreased to 8.44 in the year 2015.Inventory turnover ratio increased for all year.
That is company production is also increased. Subsequently sales are also increased
38
Account receivable turnover ratio

Accounts receivable turnover is the number of times per year that a business collects its average accounts
receivable. The ratio is intended to evaluate the ability of a company to efficiently issue credit to its
customers and collect funds from them in a timely manner.
Formula
Net credit sale Average account receivable
Data
2015
15,961,413
Sales
2014
2013
2012
2011
12,242,719 8,875,114 7,217,116 5,868,260
Trade debts
Other receivables
131,810
8,913
142,345
11,398
79,987
4,121
112,423
7,023
89625
2317
Total receivable
Account receivable ratio
140,723
113.42
153,743
79.63
84,108
105.52
119,446
60.42
91,942
63.83
Graph
113.42
120
105.52
100
79.63
80
63.83
60.42
60
40
20
0
2011
2012
1013
2014
2015
Account receivable ratio
Interpretation
Debtors turnover ratio is 63.83 times in the year 2011 and it is decreased to 60.42 times in the year 2012
and increased to10 5.52 times in the year 2013 and it decreased t o 79.63 times & it is increased to 113.42
times in the years 2015.
39
Total Assets Turnover Ratio

Asset turnover ratio is the ratio of the value of a company's sales or revenues generated relative to the
value of its assets. The Asset Turnover ratio can often be used as an indicator of the efficiency with which
a company is deploying its assets in generating revenue.
Formula
Revenue Total assets100
Data
2015
2014
2013
2012
2011
15,961,413 12,242,719 8,875,114 7,217,116 5,868,260
5,398,115 5,326,994 3,637,143 2,631,723 2,080,667
2.95
2.29
2.44
2.74
2.82
Revenue or Sale
Total assets
Total assets turnover ratio
Graph
2.82
2.95
2.74
2.44
2.29
2.5
2
1.5
1
0.5
0
2011
2012
2013
2014
2015
Total asset turnover ratio
Interpretation
Total assets turnover ratio is 2.82 in the year 2011 and it is decreased to 2.74 in the year 2012. In the year
2013 the ratio is 2.44 and it reduced to 2.29 in 2014 and to 2.95 increased in the years 2015.it means that
total assets increase in this year.
40
PROFITABILITY RATIOS
A profitability ratio is a measure of profitability, which is a way to measure a company's
performance. Profitability is simply the capacity to make a profit, and a profit is what is left over from
income earned after you have deducted all costs and expenses related to earning the income.
Gross Profit Ratio
Gross profit margin is a profitability ratio that calculates the percentage of sales that exceed the cost of
goods sold. In other words, it measures how efficiently a company uses its materials and labor to produce
and sell products profitably.
Formula
Gross profit Net sale 100
Data
2015
2014
2013
2012
2011
2,377,705 1,621,558 1,315,488 1,167,682
860,839
15,961,413 12,242,719 8,875,114 7,217,116 5,868,260
14.89
13.24
14.82
16.17
14.66
Gross profit
Sales
Gross profit ratio
Graph
20
14.66
16.17
14.82
15
13.24
14.89
10
5
0
2011
2012
2013
2014
2015
Gross profit ratio
Interpretation
From the above we can say that gross profit ratio is 14.66% in the year 2011 but it increased
to 16.17 % in 2012 & 14.82% decreased in 2013 & 2014 it decreased to 13.24% And in the year 2015
it is increased to 14.89% in the Year 2015.The company is maintaining proper control on
Trade Activities.
41
Net Profit Ratio

Profit Margin, net margin, net profit margin or net profit ratio is a measure of profitability. It is calculated
by finding the net profit as a percentage of the revenue.
Formula
Net income Net sale100
Data
2015
2014
2013
2012
2011
Profit for the year
1,013,924
741,150
582,886
486,014
354,502
Sales
Net profit ratio
15,961,413
6.35
12,242,719
6.05
8,875,114
6.57
7,217,116
6.73
5,868,260
6.04
Graph
6.73
6.8
6.57
6.6
6.35
6.4
6.2
6.05
6.04
6
5.8
5.6
2011
2012
2013
2014
2015
Net profit ratio
Interpretation
During the year 2011 the net profit margin is 6.04 it suddenly increased to 6.73% in the year 2012 because
of decreased in administration and selling expenses. In the next year, it decreased to 6.57% & 6.05% in
the year 20113 & 2014 and it again increased to 6.35% in 2015.
42
Operating Profit Ratio

The operating margin ratio, also known as the operating profit margin, is a profitability ratio that measures
what percentage of total revenues is made up by operating income.
Formula
Operating profit Net sale 100
Data

Sales
operating profit ratio
2015
1,627,386
15,961,413
10.20
2014
2013
2012
2011
1,148,793
884,014
759,545
562,616
12,242,719 8,875,114 7,217,116 5,868,260
9.38
9.96
10.52
9.59
Graph

11
10.52
10.2
10.5
9.96
10
9.59
9.38
9.5
9
8.5
2011
2012
2013
2014
2015
Interpretation
During the year 2011 the operating profit ratio is 9.59% it suddenly increased to 10.52% in the year 2012
because of decreased in administration and selling expenses. In the next year, it decreased to 9.96% &
9.38% in the year 20113 & 2014 and it again increased to 10.2% in 2015.
43
44
Comparison
Ratios Name
EXIDE
BWL
sum
Industries
analysis
ATBA
Short term solvency ratios
2015
2015
2015
2015
2015
current ratio
1.41
3.69
5.10
2.55
1.97
quick ratio
0.85
0.9
1.75
0.875
0.75
cash ratio
-0.32
2.65
2.33
1.165
0.05
Debt ratio
0.58
23.84
24.42
12.21
0.37
Debt to equity ratio
1.75
0.31
2.06
1.03
0.62
-3.42
13.14
9.72
4.86
-11.09
-4.64
2.63
-2.01
-1.005
8.44
9.83
12.95
22.78
11.39
113.42
1.76
3.45
5.21
2.605
2.95
Gross profit ratio
7% 19.39%
26.39
Net profit ratio
3%
6.06%
9.06
4.53
6.50%
Operating profit ratio
5% 12.53%
17.53
8.765
9.40%
17% 19.27%
36.27
Long term solvency ratios
Activity ratios
Account receivable turnover
ratio
Total asset turnover ratio
Profitability Ratios
Return on equity
45
13.195 14.90%
18.135 44.20%
Graph
Chart Title
120
100
80
60
industries ratio
Atlas battery
40
20
-20
46
CONCLUSION
From the above analysis of the companys financial statements its concluded that the companys financial
position is good because the companys leverage, activity and profitability positions are good and the company
have to increase its liquidity position for better performance in future.
47

1 Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery Limited

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Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

I would like to thank our professor,

Mr. MUHAMMAD ADIL:

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

To him belong the dimension of the

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

For the purpose of my Financial Statement Analysis project,

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Mission And Core values;

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Profit before Tax

Profit after Tax

Earnings Per Share - Basic & Diluted

Property, Plant & Equipment - Net of 1,994,955

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Profit before Tax

Profit before Tax

Profit after Tax

Earnings Per Share

Earnings Per Share

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Six Years at Glance

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

COMPANY FINANCIAL STATEMENT

Other comprehensive income

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Horizontal analysis of income statement:

272.00% 208.63% 151.24% 122.99%

Profit from operations

Profit before taxation

Profit for the year

Other comprehensive income

Earnings per share - basic and diluted

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

Vertical analysis of income statement:

Profit from operations

Other comprehensive loss for the year

Total comprehensive income for the year

Profit before taxation

Earnings per share - basic and diluted

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

1,416,705 1,155,854 1,127,859

1,432,965 1,168,802 1,135,410

Loans and advances

Deposits and prepayments

Total current assets

3,894,029 2,468,341 1,496,313

5,326,994 3,637,143 2,631,723 2,080,667

Prepared by Muhammad Zubair BS-BBA (Hons) Atlas Battery limited

EQUITY AND LIABILITIES;

Issued, subscribed and paid-up capital

2,027,500 1,477,500 1,067,500

3,220,775 2,384,566 1,789,742 1,326,938