Financial Position Of Azgard Nine

CHAPTER: 01

INTRODUCTION AND HISTORY OF THE COMPANY

THIS CHAPTER COVERS

1. Mission Statement Of the Company 2. Vision Statement Of the Company 3. Introduction of the Azgard Nine 4. History of Azgard Nine 5. History in a graph 6. Corporate Affairs 7. Company Information 8. Registered Offices 9. BUSINESS STRATEGY

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MISSION

TEXTILE & APPAREL

TO RETAIN A LEADERSHIP POSITION AS THE LARGEST VALUE ADDED DENIM PRODUCTS COMPANY IN PAKISTAN

FERTILIZERS

TO BECOME A DIVERSIFIED MANUFACTURER OF BOTH NITROGENOUS AND PHOSPHAIC CONTRIBUTING TO THE DEVELOPMENT OF THE AGRICULTURE SECTOR IN PAKISTAN

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VISION

TEXTILE & APPAREL

TO BECOME A MAJOR GLOBAL FASHION APPAREL COMPANY

FERTILIZERS

TO BECOME A MAJOR REGIONAL DIVERSIFIED FERTILIZER COMPANY

AZGARD NINE

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The Origins and the inception In the ancient legend “AZGARD” was one of none worlds in Norse Mythology- it was protected by “Heimdall” the son of nine different Mothers each attributing him with a particular skill and power – and thus He would protect Azgard from the powers that be.

The significance of Nine for our company is not just based on this Mythology but also connected with the auspicious nature of this number Throughout many different elements in and out of the world today that Be an auspicious and important number in Indian, Chinese, Japanese and Greek cultures for various different reasons.

In Chinese culture the number Nine represents ‘Change’ and ‘Transformation’, as in the case with Azgard Nine which is changing and Transforming itself into an entity with new goals, aspirations and targets.

Nine in much of ancient Greek methodology also has represented gestation And fulfillment of creation as it does for us at Azgard Nine. The ‘fulfillment Of creation’ for us being the forming of this global entity by nine members on the ninth day of February sowing the seeds for an auspicious and rewarding future.

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The Azgard Nine Limited Group was started as a family business over four generations ago. The Sheikh family, Now in its Forth generation, in one of the oldest business families in the sub continent with experience in many different sectors and having a proven track record of successful leadership in four continents. The gamily began its first operations in 1886 in shamkot, in the Asian sub continent. Although, now, A Public company the family still remains behind the company in everyway, supporting and nurturing its growth into the future and beyond. The current specialized yarn operation was set up in 1972 with the open end spinning and denim weaving operations following in 1995. The final frontier was the garments operation, which cane in to being in 1997. The concept behind the group’s textile ambitions was to be a fully vertical apparel solution provider based in a country that would be able to maintain its competitive advantage in this field for the yards to come (Pakistan is the fourth largest denim producer in the world with an annual production of 200,000,000 meters). This has now been achieved and Azgard in able to offer these services as a single source supplier for all denim and specialized yarn customers. The future is squeezing the brand customers toward a sourcing solution that stems from as small a global map as will allow. We believe it is feasible, in order to not be spread too thin’, to consolidate a position in as few regions as possible in the quest of r practical and economical global sourcing – Azgard Nine limited is that perfect vehicle which can accommodate and achieve this position, therefore realizing the vision that was incepted so many years ago by the guardians of the Azgard group bring the resultant advantages to you the customer.

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CORPORATE INFORMATION

BOARD OF DIRECTORS  Mr. Mueen Afzal Chairman  Mr. Ahmed H. Shaikh Chief Executive Chief Justice (Retd.) Mian Mahboob Ahmad  Mr. Aehsun M.H. Shaikh  Mr. Ali Jehangir Siddiqui  Mr. Khalid A.H. Al-Sagar  Mr. Mohammed Khaishgi COMPANY SECRETARY  Mr. Muhammad Ijaz Haider CHIEF FINANCIAL OFFICER  Mr. Abid Amin  AUDIT COMMITTEE  Chief Justice (Retd.) Mian Mahboob Ahmad  Chairman  Mr. Mueen Afzal MANAGEMENT TEAM  Mr. Ahmed H. Shaikh  Mr. Tariq Mohammad Khan  Mr. Abid Amin  Mr. Irfan Nazir  Mr. Tahir Munir  Mr. Atif Farooqi  Mr. Usman Rasheed FINANCE COMMITTEE       

Mr. Ahmed H. Shaikh Mr. Ali Jehangir Siddiqui Mr. Tariq Mohammad Khan HUMAN RESOURSE COMMITTEE Mr. Ahmed H. Shaikh Mr. Tariq Mohammad Khan Mr. Salim Khan

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BANKERS                   

JS Bank Limited MCB Bank Limited Citibank N.A. ABN Amro Bank Faysal Bank Limited Habib Bank Limited Saudi Pak Industrial & Agricultural Investment Company (Private) Limited The Hong Kong and Shanghai Banking Corporation United Bank Limited Standard Chartered Bank Pakistan Limited NIB Bank Limited National Bank of Pakistan Allied Bank Limited My Bank Limited KASB Bank Limited Pak Oman Investment Company Saudi Pak Commercial Bank

LEGAL ADVISORS  Hamid Law Associates AUDITORS

    

Rahman Sarfaraz Rahim Iqbal Rafiq Chartered Accountants TAX ADVISORS Faruq Ali & Co. Chartered Accountants

REGISTERED OFFICE

    

Ismail Aiwan-e-Science Off Shahrah-e-Roomi Lahore, 54600 Ph: +92 (0)42 111-786-645 Fax: +92 (0)42 5761791

 PROJECT LOCATION

Unit I

   

2.5 KM off Manga, Raiwind Road, District Kasur. Ph: +92 (0)42 5384081 Fax: +92 (0)42 5384093

Unit II  Alipur Road, Muzaffargarh.  Ph: +92 (0)661 422503, 422651  Fax: +92 (0)661 422652 Unit III

   

20 KM off Ferozepur Road, 6 KM Badian Road on Ruhi Nala Der Khurd, Lahore. Ph: +92 (0)42 8460333, 8488862

FINANCIAL ANALYSIS OF THE COMPANY THIS CHAPTER COVERS: -

1. 2. 3. 4. 5. 6.

PURPOSE OF FINANCIAL ANALYSIS FINANCIAL REPORTING POLICIES RATIO ANALYSIS ADVANTAGES OF RATIO ANALYSIS LIMITATION OF RATIO ANALYSIS TYPES OF RATIO ANALYSIS 1) LIQUIDITY RATIO 2) TURNOVER RATIO 3) PROFITABILITY RATIO 4) LEVERAGE RATIO 7. HORIZONTAL ANALYSIS OF PROFIT & LOSS ACCOUNT 8. HORIZONTAL ANALYSIS OF BALANCE SHEET 9. VERTICAL ANALYSIS OF PROFIT & LOSS ACCOUNT 10. VERTICAL ANALYSIS OF BALANCE SHEET

PURPOSE OF FINANCIAL ANALYSIS

1) In our course of financial management we are required to make a financial analysis of any manufacturing company. The main purpose of these analyses is that we are the business graduate and it is very necessary for us to apply our knowledge in the practical way. For example if in future we are the manager of any bank and a company wants to obtain a loan from our bank then we make analysis of the company’s financial statement to access the capacity of paying us interest on time as well as the principle which we lend that company through analyzing the different ratio analyses, and to know that what is capital structure of the company.

2) Then through the cash flow statement we are able to know that how much cash is available with the company because profitability does not mean that the company has the equal amount of cash. We also able to know that how much cash is generated by the company from its operating activities, and how much amount of cash is investing in the asset through which we can access the future performance of the company.

3) Being as an investor if we are able to make an analysis of financial statement then we can invest in that venture which is the best in terms of our purpose.

4) Being as an investor before investing in any company we can analyze the performance of the company through the vertical analyses and horizontal analyses with the current and previous year or we can also comparison of the company with the other company of the same age (Competitors) and applying the same accounting techniques.

Financial Reporting Policies

Company policies with reference to accounting, finance and corporate matters are governed by relevant corporate regulations, Companies Ordinance 1984, and the code of corporate Government

It is company resolved to comply with International Accounting Standards for the preparation of financial statements with any departure there from being adequately disclosed.

Company is in the process of establishing and efficient Internal Audit Department to enhance the scope of internal control and data generated by the company, it also help in building the confidence of our creditors, financial institutions and other interested organization

RATIO ANALYSIS The term "accounting ratios" is used to describe significant relationship between figures shown on a balance sheet, in a profit and loss account, in a budgetary control system or in any other part of accounting organization. Accounting ratios thus shows the relationship between accounting data. Ratio analysis is very important while measuring the performance of the business. These ratios are carried out from the Income statement and balance sheet. Many parties including management, investors and Government are interested in these ratios. The purpose of analysis is to measure the performance of the company and financial health of the organization.

Advantages of Ratios Analysis Ratio analysis is an important and age-old technique of financial analysis. The following are some of the advantages of ratio analysis: Simplifies financial statements: It simplifies the comprehension of financial statements. Ratios tell the whole story of changes in the financial condition of the business Facilitates inter-firm comparison: It provides data for inter-firm comparison. Ratios highlight the factors associated with successful and unsuccessful firm. They also reveal strong firms and weak firms, overvalued and undervalued firms.

Helps in planning: It helps in planning and forecasting. Ratios can assist management, in its basic functions of forecasting for Planning, co-ordination, control and communications. Makes inter-firm comparison possible: Ratios analysis also makes possible comparison of the performance of different divisions of the firm. The ratios are helpful in deciding about their efficiency or otherwise in the past and likely performance in the future. Help in investment decisions: It helps in investment decisions in the case of investors and lending decisions in the case of bankers etc.

Limitations of Ratios Analysis The ratios analysis is one of the most powerful tools of financial management. Though ratios are simple to calculate and easy to understand, they suffer from serious limitations. Limitations of financial statements: Ratios are based only on the information which has been recorded in the financial statements. Financial statements themselves are subject to several limitations. Thus ratios derived, there from, are also subject to those limitations. For example; non-financial changes though important for the business are not relevant by the financial statements. Financial statements are affected to a very great extent by accounting conventions and concepts. Personal judgment plays a great part in determining the figures for financial statements. Comparative study required: Ratios are useful in judging the efficiency of the business only when they are compared with past results of the business. However, such a comparison only provide glimpse of the past performance and forecasts for future may

not prove correct since several other factors like market conditions, management policies, etc. may affect the future operations. Ratios alone are not adequate. Ratios are only indicators, they cannot be taken as final regarding good or bad financial position of the business. Other things have also to be seen. Problems of price level changes: A change in price level can affect the validity of ratios are calculated for different time periods. In such a case the ratio analysis may not clearly indicate the trend in solvency and profitability of the company. The financial statements, therefore, be adjusted keeping in view the price level changes if a meaningful comparison is to be made through accounting ratios. Lack of adequate standard: No fixed standard can be laid down for ideal ratios. There are no well accepted standards or rule of thumb for all ratios which can be accepted as norm. It renders interpretation of the ratios difficult. Limited use of single ratios: A single ratio, usually, does not convey much of a sense. To make a better interpretation, a number of ratios have to be calculated which is likely to confuse the analyst than help him in making any good decision. Personal bias: Ratios are only means of financial analysis and not an end in itself. Ratios have to interpret and different people may interpret the same ratio in different way. Incomparable: Not only industries differ in their nature, but also the firms of the similar business widely differ in their size and accounting procedures etc. It makes comparison of ratios difficult and misleading.

Ratio Analysis Ratio analysis involves the methods of calculating and interpreting financial ratios to access the firm’s performance and status. The basic inputs to ratio analysis and firm’s income statement and balance sheet for the periods to be examined.

TYPES OF RATIO ANALYSIS Two types of Ratio Analysis are generally carried out, 1.Cross Sectional Approach, in this approach, the effectiveness of business is compared with the competitors business of the same period. 2.Most companies use the Time Series Analysis in which the performance of company over a period is measured. Ratio Analysis categories: A) Liquidity B) Turnover C) Profitability D) Leverage

LIQUIDITY RATIOS: Liquidity ratios are the ratios for testing short term solvency or financial position of a business. These are designed to test the ability of the business to meet its short term

obligation promptly. A class of financial metrics that is used to determine a company's ability to pay off its short-terms debts obligations. Generally, the higher the value of the ratio, the larger the margin of safety that the company possesses to cover short-term debts.

Current Ratio: Current ratio may be defined as the relationship between current assets and current liabilities. This ratio is also known as "working capital ratio". It is a measure of general liquidity and is most widely used to make the analysis for short term financial position or liquidity of a firm. It is calculated by dividing the total of the current assets by total of the current liabilities. Components: The two basic components of this ratio are current assets and current liabilities. Current assets include cash and those assets which can be easily converted into cash within a short period of time, generally, one year, such as marketable securities or readily realizable investments, bills receivables, sundry debtors, (excluding bad debts or provisions), inventories, work in progress, etc. Prepaid paid expenses should also be included in current assets because they represent payments made in advance which will not have to be paid in near future. Current liabilities are those obligations which are payable within a short period of tie generally one year and include outstanding expenses, bills payable, sundry creditors, bank overdraft, accrued expenses, short term advances, income tax payable, dividend payable, etc. However, some times a controversy arises that whether overdraft should be regarded as current liability or not. Often an arrangement with a bank may be regarded as permanent and therefore, it may be treated as long term liability. At the same time the fact remains that the overdraft facility may be cancelled at any time. Accordingly, because of this reason and the need for conversion in interpreting a situation, it seems advisable to include overdrafts in current liabilities. Limitations of Current Ratio: This ratio is measure of liquidity and should be used very carefully because it suffers from many limitations. It is, therefore, suggested that it should not be used as the sole index of short term solvency 1. It is crude ratio because it measures only the quantity and not the quality of the

current assets. 2. Even if the ratio is favorable, the firm may be in financial trouble, because of more stock and work in process which is not easily convertible into cash, and, therefore firm may have less cash to pay off current liabilities. 3. Valuation of current assets and window dressing is another problem. This ratio can be very easily manipulated by overvaluing the current assets. An equal increase in both current assets and current liabilities would decrease the ratio and similarly equal decrease in current assets and current liabilities would increase current ratio.

Significance This ratio is a general and quick measure of liquidity of a firm. It represents the margin of safety or cushion available to the creditors. It is an index of the firm’s financial stability. It is also an index of technical solvency and an index of the strength of working capital. A relatively high current ratio is an indication that the firm is liquid and has the ability to pay its current obligations in time and when they become due. On the other hand, a relatively low current ratio represents that the liquidity position of the firm is not good and the firm shall not be able to pay its current liabilities in time without facing difficulties. An increase in the current ratio represents improvement in the liquidity position of the firm while a decrease in the current ratio represents that there has been deterioration in the liquidity position of the firm. A ratio equal to or near 2: 1 is considered as a standard or normal or satisfactory. The idea of having doubled the current assets as compared to current liabilities is to provide for the delays and losses in the realization of current assets. However, the rule of 2:1 should not be blindly used while making interpretation of the ratio. Firms having less than 2 : 1 ratio may be having a better liquidity than even firms having more than 2 : 1 ratio. This is because of the reason that current ratio measures the quantity of the current assets and not the quality of the current assets. If a firm's current assets include debtors which are not recoverable or stocks which are slow-moving or obsolete, the current ratio may be high but it does not represent a good liquidity position.

current ratio year

current assets/current liabilities 2008 2007 2006 2005

2004

Azgard 9

1.08

1.51

1.14

1.09

1.25

Sapphire

1.28

1.66

1.21

1.21

1.31

Nishat

1.19

1.74

1.38

1.24

0.37

Comments: Current Ratio clears the extent to which the claim of short term creditors can be met by assets that are to become cash within a year. The best standard ratio is 2:1 so, the Azgard Nine has current ratio below standard. There is a mixed trend from 2004 to 2008. Current Ratio of Sapphire is also like Azgard Nine and Nishat. Current ratio shows that how many times current assets are available to meet its current liabilities. Azgard Nine current ratio shows mixed trend and it has grater than 1:1 but only in 2007 it is higher than other years. Sapphire also shows mixed trend in current ratio. Nishat current ratio shows increasing trend in 2004, 2005 and in 2006 and in 2007 but decreases 2008 which shows that it has less current assets or current liabilities increases.

Liquidity or Acid Test or Quick Ratio: Liquid ratio is also termed as "Liquidity Ratio”,” Acid Test Ratio" or "Quick Ratio". It is the ratio of liquid assets to current liabilities. The true liquidity refers to the ability of a firm to pay its short term obligations as and when they become due Components: The two components of liquid ratio (acid test ratio or quick ratio) are liquid assets and liquid liabilities. Liquid assets normally include cash, bank, sundry debtors, bills receivable and marketable securities or temporary investments. In other words they are current assets minus inventories (stock) and prepaid expenses. Inventories cannot be termed as liquid assets because it cannot be converted into cash immediately without a loss of value. In the same manner, prepaid expenses are also excluded from the list of liquid assets because they are not expected to be converted into cash. Similarly, Liquid

liabilities means current liabilities i.e., sundry creditors, bills payable, outstanding expenses, short term advances, income tax payable, dividends payable, and bank overdraft (only if payable on demand). Some time bank overdraft is not included in current liabilities, on the argument that bank overdraft is generally permanent way of financing and is not subject to be called on demand. In such cases overdraft will be excluded from current liabilities. Significance: The quick ratio/acid test ratio is very useful in measuring the liquidity position of a firm. It measures the firm's capacity to pay off current obligations immediately and is more rigorous test of liquidity than the current ratio. It is used as a complementary ratio to the current ratio. Liquid ratio is more rigorous test of liquidity than the current ratio because it eliminates inventories and prepaid expenses as a part of current assets. Usually high liquid ratios and indication that the firm is liquid and has the ability to meet its current or liquid liabilities in time and on the other hand a low liquidity ratio represents that the firm's liquidity position is not good. As a convention, generally, a quick ratio of "one to one" (1:1) is considered to be satisfactory. Although liquidity ratio is more rigorous test of liquidity than the current ratio, yet it should be used cautiously and 1:1 standard should not be used blindly. A liquid ratio of 1:1 does not necessarily mean satisfactory liquidity position of the firm if all the debtors cannot be realized and cash is needed immediately to meet the current obligations. In the same manner, a low liquid ratio does not necessarily mean a bad liquidity position as inventories are not absolutely non-liquid. Hence, a firm having a high liquidity ratio may not have a satisfactory liquidity position if it has slow-paying debtors. On the other hand, a firm having a low liquid ratio may have a good liquidity position if it has fast moving inventories. Though this ratio is definitely an improvement over current ratio, the interpretation of this ratio also suffers from the same limitations as of current ratio

quick ratio year Azgard 9 Sapphire Nishat

(current assets-stock)/current liabilities 2 008 0.69 0.72 0.84

2007 1. 15 1. 17 1. 33

2006 0. 88 0. 73 0. 96

2005 0. 64 0. 59 0. 78

2004 0.7 1 0.7 6 0.3 7

Comments: The acid test ratio is also below standard due to heavy short term borrowings. Azgard Nine acid test ratio decreased in year 2005 and in 2008. The quick ratio of Sapphire shows that there is no sufficient liquid asset is available to discharge and settle its current obligation except in year 2007. The rise in current liabilities is due to the expansion of project and short and long term financing. Azgard Nine liquidity is less than standard except in year 2007. Sapphire and Nishat liquidity is not on considerable point. Azgard Nine liquid ratio is more than Sapphire and Nishat which shows that it has more liquidity. Nishat liquidity position is not considerable because it is near to 1 in year 2006 and 2007 which shows that it has liquid assets to meet its current liabilities. Azgard Nine position is not at considerable point. It shows decreasing trend in 2005 and in 2008 and less than 1:1. But it has increasing position in 2004, 2006 and in 2007.

Turnover/ Activity ratios: Activity ratios are measures of how well assets are used. Activity ratios -- which are, for the most part, turnover ratios -- can be used to evaluate the benefits produced by specific assets, such as inventory or accounts receivable. Or they can be use to evaluate the benefits produced by all a company's assets collectively. These measures help us gauge how effectively the company is at putting its investment to work. A company will invest in assets – e.g., inventory or plant and equipment – and then use these assets to generate revenues. The greater the turnover, the more effectively the company is at producing a benefit from its investment in assets

Inventory days. The number of day’s inventory is also known as average inventory period and inventory holding period. A high number of days inventory indicates that their is a lack of demand for the product being sold. A low days inventory ratio (inventory holding period) may indicate that the company is not keeping enough stock on hand to meet demands. The number of day’s inventory and inventory turnover ratios are included in the financial statement ratio analysis spreadsheets highlighted in the left column, which provide formulas, definitions, calculation, charts and explanations of each ratio. Inventory Days year Azgard 9 Sapphire Nishat

Inventory Days 2008 2007 221. 177.4 08 2 138. 89.3 85 6 91. 79.1 90 0

= Inventory / Cost of Sales*365 2006 2005 2004 199.3 208.5 225.76 4 7 96.7 143.4 64.3 4 6 2 80.0 114.4 0 6 -

Comments: Azgard Nine inventory days increased in 2005 as compare to 2004 and decreased in 2006 and in 2007 and show increasing in 2008 which shows that management is not efficient for managing inventory period. The above diagram shows that in 2004 and 2005 Sapphire has high inventory days required converting stock in sale which shows that Sapphire management is not efficient but it decreases with the passage of times and increase in year 2008 and Nishat trend is

equal to Sapphire. They were show increase in 2005 and low in 2006 and in 2007 and it increases in 2008.

Debtors Turnover Ratio or Receivables Turnover Ratio: Debtor’s turnover ratio indicates the velocity of debt collection of a firm. In simple words it indicates the number of times average debtors (receivable) are turned over during a year. Significance of the Ratio: This ratio indicates the number of times the debtors are turned over a year. The higher the value of debtor’s turnover the more efficient is the management of debtors or more liquid the debtors are. Similarly, low debtors turnover ratio implies inefficient management of debtors or less liquid debtors. It is the reliable measure of the time of cash flow from credit sales. There is no rule of thumb which may be used as a norm to interpret the ratio as it may be different from firm to firm. Debtor's day year 2008 Azgard 9 Sapphire Nishat

Comments:

64 42 25

Trade debtors/Credit sales*365 2007 2006 2005

2004

91

85

84

109

51

54

67

56

18

23

28

56

Graph shows that Azgard Nine has not a good debtor management to receive the debt or collect the receivables and shows positive trend and debtor’s collection period is grater than creditor’s period. Sapphire position is also considerable but Nishat management has more efficient to collect their receivables whish shows efficient debtor management and in 2004 it is at highest point which indicates unfavorable situation regarding to debtor collection period.

Creditors / Accounts Payable Turnover Ratio: This ratio is similar to the debtor’s turnover ratio. It compares creditors with the total credit purchases. It signifies the credit period enjoyed by the firm in paying creditors. Accounts payable include both sundry creditors and bills payable. Same as debtor’s turnover ratio, creditor’s turnover ratio can be calculated in two forms, creditors’ turnover ratio and average payment period. Significance of the Ratio: The average payment period ratio represents the number of days by the firm to pay its creditors. A high creditor’s turnover ratio or a lower credit period ratio signifies that the creditors are being paid promptly. This situation enhances the credit worthiness of the company. However a very favorable ratio to this effect also shows that the business is not taking the full advantage of credit facilities allowed by the creditors. Creditors days year Azgard 9 Sapphire Nishat

Comments:

2008 49 18 22

Trade Creditors/Credit Sales*365 2007 2006 2005 57 93 65 15 31 39 20 21 26

2004 80 25 45

Azgard Nine creditor’s days increase in 2004 to 2006 and decrease in 2005 to 2007 and in 2007 and 2008. Azgard Nine credit management is better than Nishat and Sapphire it has 93 days for payment which shows it efficiency in 2006. If we compare creditor’s days to debtors day than we can see that Azgard Nine and Nishat is going better to manage its resources

Total Assets Turnover Ratio. The total assets turnover ratio measures the use of all assets in terms of sales, by comparing sales with net total assets. This interactive tutorial walks you through the calculations as well as where on the financial statements to find the numbers.

Formula year Azgard 9 Sapphire Nishat

Sales/ Total Assets 2008 2007 0. 0.37 28 0. 0.79 82 0. 0.51 43

2006 0. 21 0. 86 0. 53

2005 0. 42 0. 73 0. 52

2004 0. 50 1. 29 1. 40

Comments: In the above graph we can see that total asset turnover ratio of Azgard Nine Company showing mix trend in the year 2004 to year 2008. Total asset turnover ratio is at highest level in year 2004 and as it compare it with Nishat and Sapphire it is not good even in the

last two year 2007, 2008 so we can say it is not using its assets for generating the revenue in a better way than Sapphire and Nishat cement in 2004 to 2008 and 2004 Sapphire total asset turnover ratio at top so they use much of it for generating revenue. But Azgard Nine overall situation regarding to total asset turnover ratio is bad than other two competitor.

Fixed Assets Turnover Ratio: Fixed assets turnover ratio is also known as sales to fixed assets ratio. This ratio measures the efficiency and profit earning capacity of the concern. Higher the ratio, greater is the intensive utilization of fixed assets. Lower ratio means under-utilization of fixed assets

Formula year Azgard 9 Sapphire Nishat

Cost of sales / Fixed Assets 2008 2007 2006 0 0 0. .86 .60 49 2 2 1. .19 .10 94 1 1 1. .53 .35 29

2005 1. 06 1. 52 1. 01

2004 0. 86 2. 92 2. 92

Comments: It shows the utilization of fixed assets, Azgard Nine decreasing the utilization of its fixed assets but it has lower times than Sapphire which has more utilization of fixed

assets and at highest level in 2004. Nishat shows the decreasing trend in year 2005 and after it increasing trend still 2008. Nishat has less utilization than Sapphire and high utilization then Azgard Nine.

Profitability Ratios: Profitability ratios (also referred to as profit margin ratios) compare components of income with sales. They give us an idea of what makes up a company's income and are usually expressed as a portion of each dollar of sales. The profit margin ratios we discuss here differ only by the numerator. It's in the numerator that we reflect and thus evaluate performance for different aspects of the business: The gross profit margin is the ratio of gross income or profit to sales. This ratio indicates how much of every dollar of sales is left after costs of goods sold.

Gross Profit (GP) Ratio: Gross profit ratio (GP ratio) is the ratio of gross profit to net sales expressed as a percentage. It expresses the relationship between gross profit and sales. Components: The basic components of the calculation of gross profit ratio are gross profit and net sales. Net sales mean those sales minus sales returns. Gross profit would be the difference between net sales and cost of goods sold. Cost of goods sold in the case of a trading concern would be equal to opening stock plus purchases, minus closing stock plus all direct expenses relating to purchases. In the case of manufacturing concern, it would be equal to the sum of the cost of raw materials, wages, direct expenses and all manufacturing expenses. In other words, generally the expenses charged to profit and loss account or operating expenses are excluded from the calculation of cost of goods sold. Significance: Gross profit ratio may be indicated to what extent the selling prices of goods per unit may be reduced without incurring losses on operations. It reflects efficiency with which a firm produces its products. As the gross profit is found by deducting cost of goods sold from net sales, higher the gross profit better it is. There is no standard GP ratio for evaluation. It may vary from business to business. However, the gross profit earned should be sufficient to recover all operating expenses and to build up reserves after paying all fixed interest charges and dividends. Formula

Gross profit/Sales*100

year Azgard 9 Sapphire Nishat

2008 3 4.15 1 1.57 1 5.41

2007 30 .28 13 .02 16 .56

2006 24. 26 9. 60 16. 54

2005 25. 63 11. 32 18. 77

2004 22. 66 4. 96 4. 96

Comments: Gross profit of Azgard Nine Company increasing in 2004 to 2005 and also in year 2007 and 2008 but decrease in 2006, Due to inflation and economic instability in Pakistan and irregular power supply of WAPDA in 2007 and 2008. Gross Profit ratio of three competitors show increasing trend in 2004 to 2005 due to good economic and financial situation of world and good market situation in Pakistan. Sapphire position is more considerable up to 2005 but shows decreasing trend in 2006, 2007 and 2008, and Nishat situation for increase year 2007 but it decrease in all other years.

Operating Profit Ratio: Operating ratio is the ratio of cost of goods sold plus operating expenses to net sales. It is generally expressed in percentage. It measures the cost of operations per dollar of sales. This is closely related to the ratio of operating profit to net sales. Components: The two basic components for the calculation of operating ratio are operating cost (cost of goods sold plus operating expenses) and net sales. Operating expenses normally include (a) administrative and office expenses and (b) selling and distribution expenses.

Financial charges such as interest, provision for taxation etc. are generally excluded from operating expenses. Significance: Operating ratio shows the operational efficiency of the business. Lower operating ratio shows higher operating profit and vice versa. An operating ratio ranging between 75% and 80% is generally considered as standard for manufacturing concerns. This ratio is considered to be a yardstick of operating efficiency but it should be used cautiously because it may be affected by a number of uncontrollable factors beyond the control of the firm. Moreover, in some firms, non-operating expenses from a substantial part of the total expenses and in such cases operating ratio may give misleading results Formula

year Azgard 9 Sapphire Nishat

Operating Profit Margin = Operating profit /Sale*100 2008 2007 2006 2005 2004 28.18 23.72 16.26 18.38 16.79 14.42 8.60 8.68 10.43 5.35 37.91 12.66 12.10 17.58 7.56

Comments: Azgard Nine company operating profit increasing in 2004 to 2005 and 2007 to 2008 and decreasing in 2006. Operating profit of all three organization show increasing trend in 2004, 2005 and 2007 to 2008 but decreases in 2006 due to increase in operating expenses.

Net Profit/ (Loss) Before Tax: Net profit ratio is the ratio of net profit (after taxes) to net sales. It is expressed as percentage

Significance: NP ratio is used to measure the overall profitability and hence it is very useful to proprietors. The ratio is very useful as if the net profit is not sufficient, the firm shall not be able to achieve a satisfactory return on its investment. This ratio also indicates the firm's capacity to face adverse economic conditions such as price competition, low demand, etc. Obviously, higher the ratio the better is the profitability. But while interpreting the ratio it should be kept in minds that the performance of profits also is seen in relation to investments or capital of the firm and not only in relation to sales. Formula year Azgard 9 Sapphire Nishat

Net profit before tax/Sales*100 2008 2007 9.88 17.37 6.88 3.49 33.20 7.89

2006 25.77 3.31 10.71

2005 17.91 7.15 17.88

2004 12.52 3.45 9.45

Comments: The Net Profit margin tells us the ability of a company to generate the earning after meeting all costs of business. There is an increase in net profit in 2006 as compare to 2004 to 2006. In year 2008 company suffered a minimum net profit. The ratio has decreased as compare to previous year due to increase in cost and expansion of project and finance cost. Sapphire shows the increasing trend in 2005 and in year 2007 to 2008 it decrease in year 2006. Nishat top net profit is in year 2008.

Net Profit/ (Loss) after Tax: Net profit ratio is the ratio of net profit (after taxes) to net sales. It is expressed as percentage

Significance: NP ratio is used to measure the overall profitability and hence it is very useful to proprietors. The ratio is very useful as if the net profit is not sufficient, the firm shall not be able to achieve a satisfactory return on its investment. This ratio also indicates the firm's capacity to face adverse economic conditions such as price competition, low demand, etc. Obviously, higher the ratio the better is the profitability. But while interpreting the ratio it should be kept in mind that the performance of profits also be seen in relation to investments or capital of the firm and not only in relation to sales. Components of net profit ratio: The two basic components of the net profit ratio are the net profit and sales. The net profits are obtained after deducting income-tax and, generally, non-operating expenses and incomes are excluded from the net profits for calculating this ratio. Thus, incomes such as interest on investments outside the business, profit on sales of fixed assets and losses on sales of fixed assets, etc are excluded. Formula year Azgard 9 Sapphir e Nishat

Net profit after tax/Sales*365 2008 2007 2006 8.8 16.2 23.4 7 9 1 6.3 2.3 1.6 4 6 9 31.8 7.0 9.9 6 5 5

2005 16.7 6

2004 11.8 9

5.4 1

2.3 1

16.4 2

10.5 9

Comments: The Net Profit margin tells us the ability of a company to generate the earning after meeting all costs of business. There is an increase in net profit in 2006 and in 2005 as compare to 2005 and 2004 respectively. In year 2008 company earned a minimum net profit in last five years. The ratio has decreased as compare to previous year due to

increase in sale and expansion of project and finance cost. The other organization has mix trend.

Return on Assets: Where asset turnover tells an investor the total sales for each $1 of assets, return on assets [or ROA for short] tells an investor how much profit a company generated for each $1 in assets. The return on assets figure is also a sure-fire way to gauge the asset intensity of a business. Companies such as telecommunication providers, car manufacturers, and railroads are very asset-intensive, meaning they require big, expensive machinery or equipment to generate a profit. Advertising agencies and software companies, on the other hand, are generally very asset-light (in the case of a software companies, once a program has been developed, employees simply copy it to a five-cent disk, throw an instruction manual in the box, and mail it out to stores). Formula year Azgard 9 Sapphire Nishat

Net Income / Total Assets*100 2008 2007 2006 3.28 4.57 4.94 5.01 1.94 1.46 16.19 3.06 5.24

2005 7.03 3.95 8.52

2004 5.96 2.97 14.81

Comments: This ratio measures the return of total investment of the business. Azgard Nine company show mix trend and in 2005 it is at maximum point than others. Decreasing trend from year 2006 to year 2008. Nishat company return on asset is much better than Azgard Nine and Sapphire. It decreases in 2005 to 2007 and than increase in 2008, it is at

highest point in 2008, Sapphire also increases in 2004 to 2005 and than it little decrease in 2006 and at goes down in 2007 and becomes increase in 2008.

Return on Capital Employed (ROCE) Ratio: Capital employed and operating profits are the main items. Capital employed may be defined in a number of ways. However, two widely accepted definitions are "gross capital employed" and "net capital employed". Gross capital employed usually means the total assets, fixed as well as current, used in business, while net capital employed refers to total assets minus liabilities. On the other hand, it refers to total of capital, capital reserves, revenue reserves (including profit and loss account balance), debentures and long term loans.

Formula year Azgard 9 Sapphire Nishat

Profit before interest and taxation / Capital Employed *100 2 2008 2007 2006 005 2004 5.87 6.60 8.27 13.00 10.73 10.41 4.46 5.07 8.85 7.25 24.42 4.25 7.29 12.98 (30.48)

Comments: Azgard Nine return on capital employed is high 2004 and it increase in 2005 but it has decreased in 2006 to 2008. Sapphire return on capital employed increase in 2004 to 2005 and decreases in 2006 and in 2007 and then it go for increase in 2008. Nishat has

less return on capital employed is less than its competitors from 2004 to 2007. And at begging Nishat is going to negative its return of capital employed. In 2008 due to economic crises Sapphire and Azgard Nine return on equity becomes higher then its competitors.

RETURN ON EQUITY CAPITAL (ROE) RATIO:

In real sense, ordinarily shareholders are the real owners of the company. They assume the highest risk in the company. (Preference share holders have a preference over ordinary shareholders in the payment of dividend as well as capital. Preference share holders get a fixed rate of dividend irrespective of the quantum of profits of the company). The rate of dividends varies with the availability of profits in case of ordinary shares only. Thus ordinary shareholders are more interested in the profitability of a company and the performance of a company should be judged on the basis of return on equity capital of the company. Return on equity capital which is the relationship between profits of a company and its equity, can be calculated as follows. Equity share capital should be the total called-up value of equity shares. As the profit used for the calculations are the final profits available to equity shareholders as dividend, therefore the preference dividend and taxes are deducted in order to arrive at such profits. Significance: This ratio is more meaningful to the equity shareholders who are interested to know profits earned by the company and those profits which can be made available to pay dividends to them. Interpretation of the ratio is similar to the interpretation of return on shareholder's investments and higher the ratio better is.

Formula YEARS

[(Net profit after tax − Preference dividend) / Equity share capital] × 100 2008

2007

2006

2005

2004

Azgard 9

8.86

11.11

12.48

23.97

14.95

Sapphire

11.08

3.59

3.45

10.32

7.40

Nishat

24.41

4.02

7.73

14.58

2.62

Comments: In 2005 Azgard Nine Company return on equity ratio is at highest point and better, in 2006 to 2008 it decreases. Sapphire Company also shows mixed trend. It is going higher in 2005 and than decrease in 2006 to 2007 and it becomes higher in 2008. Nishat company return on equity ratio has mix trend. In 2004 it is at lower side and than it increase in 2005 and it decrease in 2006 and it goes down and become more down in 2007 and go to highest point in 2008. It is the highest point then competitors.

LEVERAGES RATIOS:

A company can finance its assets either with equity or debt. Financing through debt involves risk because debt legally obligates the company to pay interest and to repay the principal as promised. Equity financing does not obligate the company to pay anything -dividends are paid at the discretion of the board of directors. There is always some risk, which we refer to as business risk, inherent in any operating segment of a business. But how a company chooses to finance its operations -- the particular mix of debt and equity -- may add financial risk on top of business risk financial risk is the extent that debt financing is used relative to equity. Financial leverage ratios are used to assess how much financial risk the company has taken on. There are two types of financial leverage ratios: component percentages and coverage ratios. Component percentages compare a company's debt with either its total capital (debt plus equity) or its equity capital. Coverage ratios reflect a company's ability to satisfy fixed obligations, such as interest, principal repayment, or lease payments.

DEBT TO EQUITY RATIO:

Debt-to-Equity ratio indicates the relationship between the external equities or outsiders funds and the internal equities or shareholders funds. It is also known as external internal equity ratio. It is determined to ascertain soundness of the long term financial policies of the company. Debt to Equity Ratio

Short Term Debt + Long Term Debt Total Shareholders Equity

YEAR Azgard 9 Sapphire Fiber

2008 2.42 26.86 22.06

2007 1.79 19.14 14.34

2006 2.51 17.66 12.62

2005 2.01 15.54 12.21

2004 1.29 12.35 10.99

Comments: Azgard Nine debt to equity ratio is lowest point in 2004 and after that it has decrease its situation in next coming years and increases the ratio, but Sapphire and Nishat shows increasing trend from 2004 to 2008 which shows that they increasing there debts for expansion of project and their short and long term debts increased. It shows that Azgard nine position in debt to equity is better then its competitors.

DEBT SERVICE RATIO OR INTEREST COVERAGE RATIO:

Interest coverage ratio is also known as debt service ratio or debt service coverage ratio. This ratio relates the fixed interest charges to the income earned by the business. It indicates whether the business has earned sufficient profits to pay periodically the interest charges. Significance of debt service ratio: The interest coverage ratio is very important from the lender's point of view. It indicates the number of times interest is covered by the profits available to pay interest charges.

Interest Coverage Ratio Formula YEAR Azgard 9 Sapphir e Nishat

Net Profit Before Interest and Tax / Fixed Interest Charges 2008 2007 2006 2005 2004

Comments:

0.40

1.08

1.92

2.43

2.73

0.84

0.46

0.31

1.65

1.35

7.05

1.66

2.33

4.99

5.54

Interest Cover Ratio shows that how many times interest is earned by the company. Azgard Nine Company shows decreasing trend from 2004 to 2008 which indicates negative sign for the company and it has unavailability the funds to pay interest expense. Sapphire company is in equal position to Azgard Nine, in 2006 and 2007 Interest cover ration of all the company is not very healthy and it shows that the financial costs are very high and earnings are very low. Management must look into the matter and should improve this ratio. In year 2008 Nishat Company earned 7.05 times interest which is higher among all year and easy to pay the interest expense.

INVESTMENTS / SHARE HOLDER RATIOS:

Relationship of gains from investments (including realized capital gains) resulting from insurance operations to earned premiums.

EARNINGS PER SHARE (EPS) RATIO:

Earnings per share ratio (EPS Ratio) are a small variation of return on equity capital ratio and are calculated by dividing the net profit after taxes less preference dividend by the total number of equity shares. Significance: The earnings per share are a good measure of profitability and when compared with EPS of similar companies, it gives a view of the comparative earnings or earnings power of the firm. EPS ratio calculated for a number of years indicates whether or not the earning power of the company has increased.

Formula YEAR Azgard 9 Sapphire Nishat

Profit after tax/No. of shares 2008 2007 2006 2.65 3.26 4.97 30.76 10.77 6.70 38.42 7.58 10.22

2005 7.42 14.37 12.86

2004 4.31 8.58 5.17

Comments: The earning per share of three companies shown mixed trend in above diagram, earning per share of Azgard Nine company increase in 2005 as compare it to 2004 and it is at highest point in this year and than it decrease in 2006, and it goes more down in 2007 and 2008 which mean there is no earning and it going down. Sapphire and Nishat has also same trends but Nishat has better earning per share ratio as compare it to Sapphire and Azgard Nine. It is at highest point in 2008. The earning per share has increased as compared to the previous year. These companies should better mange its financial position and improve its performance to get out this fall in earning per share.

EARNINGS YIELD

The earnings per share for the most recent 12-month period divided by the current market price per share. The earnings yield (which is the inverse of the P/E ratio) shows the percentage of each dollar invested in the stock that was earned by the company.

Formula YEARS Azgard 9 Sapphire Nishat

Earning Per Share / Market Price Per Share * 100 2008 2007 2006 2005 2004 4.30 6.26 22.54 23.19 19.16 42.46 11.64 9.57 15.97 12.26 44.69 5.87 9.75 16.92 9.79

Comments: Earning Yield of Azgard Nine, Nishat and Sapphire was at lowest point in 2007 due to economic crises. But it has very good condition in 2004 to 2006.Azgard Nine is at lowest point in 2008 due to economic and financial crises and purchase a project of fertilizers. Return on investment of Sapphire and Nishat were very high in 2008.of all these competitors but Sapphire shows a good trend but Azgard nine is less than Sapphire and Nishat.

MARKET VALUE OF SHARE YEARS Azgard 9 Sapphire Nishat

2008 61.5 6 72.4 5 85.9 7

2007

2006

2005

2004

52.10

22.05

32.00

22.50

92.50

70.00

90.00

70.00

129.20

104.80

76.00

52.80

Comments: Graph shows that market value of share of Nishat Company is high in 2006 to 2007 as compare to Azgard nine and Sapphire. In 2007 it is at highest point, market value of Azgard Nine and Sapphire show mixed trend and Azgard Nine market value of share at high point in 2008 and Sapphire high market value in 2007.

PRICE EARNING RATIO (P/E RATIO): Price earning ratio (P/E ratio) is the ratio between market price per equity share and earning per share. The ratio is calculated to make an estimate of appreciation in the value of a share of a company and is widely used by investors to decide whether or not to buy shares in a particular company Significance of Price Earning Ratio: Price earnings ratio helps the investor in deciding whether to buy or not to buy the shares of a particular company at a particular market price Generally, higher the price earning ratio the better it is. If the P/E ratio falls, the management should look into the causes that have resulted into the fall of this ratio.

Formula YEARS Azgard 9 Sapphire Nishat

Market price per equity share / Earnings per share 2008 2007 2006 2005 2004 23.23 15.98 4.44 4.31 5.22 2.36 8.59 10.45 6.26 8.16 2.24 17.04 10.25 5.91 10.21

Comments: Price earning ratio of Azgard Nine decreasing from 2004 to 2006 which is not beneficial for the company also unfavorable for the investor and encourage the investors to invest but increase in 2007 and 2008 and at very good position in 2007 and then become better in 2008, Sapphire and Nishat shows mixed trend, Sapphire company maximum price earning ratio in 2006 and lowest in 2008 and Nishat price earning ratio never goes negative and it is at high point in 2007 which encourage the investor, it shows that there is increase in market value of share and decrease in value of earning per share.

HORIZONTAL AND VERTICAL ANALYSIS

Common Stateme nts Analysis

Common

Common

Size

Base Year

Analysis

Analysis

Vertical Analysis

Horizont al Analysis

HORIZONTAL ANALYSIS "In the base statement of previous year every item is given 100% and is subsequent years these are changed to the related percentages as per base years.” Importance Comparative statement can be prepared for several years in a columnar form. The changes from period to period can be reflected by establishing a base year and making it 100%. Thereafter all such changes are reflected in percentages. This analysis is invaluable to management and other analysts because the absolute large data are condensed into percentages. The purpose of horizontal analysis is to highlight the changes. Balance Sheet The purpose o balance sheet is to reflect financial position of an entity on a particular date. The balance sheet consists of assets, which are the property of the entity, the liabilities, which are the debts payable to outside investors or suppliers of goods and services, and the shareholder’s equity, which represents owners’ interest in the entity. At any given date, assets must be equal to the contributions of the creditors and owners. Profit And Loss Account Profit and loss account is also named income statement or income statement or income and expenditure account or statement of operations and encompasses all sources of revenue, gain and losses and expenses for a particular period, grouped into various headings as per charts of accounts of a company. In other words, it summarizes the results of operations for an accounting period. The net income is closed by transfer to balance sheet after paying the dividends and appropriations. Sometimes an appropriation is made to general reserve and still some portion is left as retained earning. The procedure of horizontal analysis of profit and loss account is same as of balance sheet.

AZGARD NINE PVT LIMITED BALANCE SHEET AS AT 31 DECEMBER 2008 EQUITY AND LIABILITIES

2008

2007

2006

2008

Rs.

Rs.

Rs.

Rs.

2007 Rs.

SHARE CAPITAL AND RESERVES ISSUED, SUBSCRIBED AND PAID UP CAPITAL

3,827 ,118,540 3,532 ,469,002 2,764 ,494,959 10,124 ,082,501

3,788 ,822,900 3,530 ,626,122 2,400 ,605,174 9,720 ,054,196

3,788,8 38,900 3,57 8,262,182 1,80 7,067,052 9,17 4,168,134

21 9,356,257

23 9,073,077

25 7,360,867

3,962 ,461,561 2,686 ,842,500

4,491 ,185,372 2,973 ,551,252

2,26 8,598,953 3,51 9,216,988

2 5,210,944

1 4,357,005

6,674 ,515,005

7,479 ,093,629

5,79 7,438,559

Current Liabilities Current Portion of non current liabilities Short term Borrowings derivative financial liabilities Trade and other payables Due to related parties- unsecured

1,470 ,921,493 6,574 ,080,304 5 0,536,909 1,350 ,500,115 42 6,768,193

98 1,049,256 3,820 ,688,516 3 4,369,582 1,030 ,875,769

45 0,047,125 6,00 6,117,630 3 2,021,607 1,24 3,588,067

Markup accrued on borrowings Unclaimed dividend

46 6,226,443 1

31 7,690,929

RESERVES Inappropriate Profit

Surplus on revaluation of property, Plant and equipment Non current liabilities Redeemable capital Secured Long term finance secured Liabilities against assets subject to finance lease

-

9,622,618

19 5,249,017 2

1%

0%

0%

-1%

15 %

33%

4%

6%

-8%

-7%

12% 10% 76 % 11% 50 % 72 % 47 % 31 % 47 % 51

98% 16% 49% 29% 1 18% 36% 7% 17% 63% -

Contingencies and commitments

ASSETS Non-current assets Property, Plant and equipment Capital work in progress intangible assets Long term investments Long term deposits

Current assets Stores spares and loose tools Stock in trade Trade receivable Derivative financial assets Advances, deposits, prepayments and other receivables Current Taxation Short Term investment Cash and Bank Balances

4,686,046 10,353 ,719,503

9,694,014 6,194 ,368,066

2,312,061 7,94 9,335,507

27,371 ,673,266

23,632 ,588,968

23,17 8,303,067

2008

% 67 % # DIV/0! 16 %

57% 22% # DIV/0!

1%

1%

2,007

2,006

Rs. 7,734 ,950,547 91 8,670,893 3 3,536,216 7,521 ,644,051 1 9,777,502 16,228 ,579,209

Rs. 7,643 ,649,558 16 7,987,854 5 1,142,669 6,391 ,905,201 2 0,239,502 14,274 ,924,784

Rs. 7,60 1,895,866 15 0,650,477 6 0,544,809 6,30 3,488,906 1 9,906,757 14,13 6,486,815

20 1,693,270 4,034 ,103,119 1,777 ,232,612 17 5,673,993

12 5,468,877 2,246 ,132,173 1,657 ,196,735 38 8,993,278

10 1,762,486 2,02 2,510,924 1,13 4,897,149 55 5,680,244

55%

78 9,515,062

1,004 ,944,292

85 7,744,304

21%

6 3,948,605 4,018 ,853,586 8 2,073,810 11,143 ,094,057 27,371 ,673,266

5 1,050,683 3,838 ,444,830 4 5,433,316 9,357 ,664,184 23,632 ,588,968

3,78 8,315,521 58 0,905,624 9,04 1,816,252 23,17 8,303,067

4 47% 34% 18 % -2% 14 % 61 % 80 % 7%

2%

12% 16% 1% 2% 1%

23% 11% 46% 30% 17%

25 %

0%

5%

1%

81 % 19 %

92% 3%

Non-Current Assets As we can see from the horizontal balance sheet analysis of two years, the total noncurrent assets have shown increasing trend. In 2007 it increases 1% from 2006 and it increases in 2008 by 14% as compare to 2007. This shows heavy investment in fixed assets by the management. Operating fixed assets showed decreasing trend in 2007 by 6.53% and it decreases 8.02% in 2008. Capital work in process increased by 430.94% in year 2007, increased by 18.06% in year 2008 respectively. Lon-term loans and advances has shown an increasing trend in 2007 by 1682.45%in 2007 and decreased by 16.60%. Its long term deposits decreased in 2007 by 76.08% and increases in 2008 by 14.18%. Current Assets Store, spare and tools has shown Increased in 2007 as compare to 2006 by 23% and increased in 2008 by 61%, which shows that company is in good position as liquidity point of view. Stock in trade shows increasing trend and increased in 2007 by 11% and in 2008 increased by 80%. This average stock of inventory is indication of good inventory management. Trade debts has shown increasing trend in 2007 as compare to 2006 by 46% and it increased by 7% in 2008.Receivable management is efficient in 2008 by showing decreasing trend. Loans and advances showed an increasing trend it increased in 2007 by 17% and in 2008 it decreases 21%. Cash and cash in bank have also shown decreasing trend in 2007 and increasing trend in 2008. Equity and Liabilities Share capital show a changing trend in 2007 by 0% and 1% increasing trend in 2008. Reserves have decreased in year 2007 by 1% and no change in 2008, which shows that company, has utilized all its reserves for expansion of project. Accumulated profit increased in 2007 by 33% and increased in 2008 by 15%. Non-Current Liabilities Non-current liabilities have also shown an increasing trend in 2007 and decrease trend in 2008. There is a sharp increase year 2007 and a decrease in year 2008. Long term security deposits and retention money also decreases in 2007 by 16% and decreased in 2008 by 10% as compare to 2006 and 2007 respectively. Liabilities against assets

increases in2007 by 49% and decreased in 2008 by 76% as compare to 2006 and 2008 respectively. Current Liabilities Total current liabilities have also shown a decreasing trend in 2007 and an increasing trend in 2008. This is also inline with decrease and increase in current assets of the company. Short term financing is taken to meet the working capital requirements. Company is not meeting its obligation on regular basis which is evident from an increase in the current portion of long term debts under current liabilities head of the balance sheet. Trade payables decreased in 2007 but increased in 2008 by 31%. Markup on secured loans also increased in 2007 by 63% in 2007and 47% in 2008 respectively. Short term borrowing also decreased by 36% in 2007 and an increased by 72% in 2008 as compare to 2006 and 2007 respectively. Finally, size of the company has increased during the last five years. More investment is made in capital assets. Company is in expansion phase since the base year. Investment in new expansion project and technology is being made in order to keep pace with changing business environment.

AZGARD NINE PVT LIMITED Profit and Loss Account for the year ended 31-12-208

Sales - Net Cost of Sales Gross Profit Administrative and selling expenses Operating Profit Other income Net Finance cost Profit before Taxation taxation Profit after Taxation

2008

2007

2006

Rs. 10,113, 499,351 (6,660, 223,767) 3,453, 275,584

Rs. 6,628, 341,926 (4,620, 988,950) 2,007, 352,976

Rs. 4,889 ,681,966 (3,703 ,361,406) 1,186 ,320,560

(603 ,529,743)

(435 ,185,073)

(39 1,290,338)

2,849, 745,841 620 ,148,589 (2,470, 391,655) 999 ,502,775 (102 ,218,852) 897 ,283,923

1,572, 167,903 641 ,224,883 (1,061, 933,212) 1,151, 459,574 (72 ,007,073) 1,079, 452,501

79 5,030,222 1,122 ,601,656 (65 7,548,074) 1,260 ,083,804 (11 5,569,082) 1,144 ,514,722

2 008

20 07

53%

36%

44%

25%

72%

69%

39%

11%

81%

98%

-3%

-43%

133%

61%

-13%

-9%

42%

-38%

-17%

-6%

ANALYTICAL REVIEW OF PROFIT & LOSS ACCOUNT Sales of the Company has shown a increasing trend and has increased up to 36% in 2007 and 53% in 2008 as compare to 2006 and 2007 respectively. Cost of sales has also shown an increasing trend. In last two years the cost has increased, it has increased in 2007 by 25% and in 2008 44% as compare to 2006 and 2007 respectively. This increase is not more than the increase in sales which is good for the company.

Gross profit of the company has also shown an increasing trend during the last two years, because company cost of sale decreases and sale increase, in 2007 gross profit increases 69% and it was 72% in 2008.Selling and distribution expenses also increases in 2007 and 2008 as 11% and 39% in 2007 and 2008 respectively. But increased in year 2008 which is 28% than the last year. This increase in gross profit was due to the decrease in cost of goods sold.

Finance cot increased in 2007 as 61% and increased in 2008 as 133% which used for expansion of new plants of fertilizers. There is a great increase in 2008 which cause the advertisement of the company. Profit before tax show decreasing trend in last two years. It had decreased in 2007 as 9% and in 2008 it was 13% it was due to the payment of new plant of fertilizers. Profit after tax decreased in 2007 by 6% and it was decrease by 17% in 2008. Company management tries to expand its operations so it needs more finds that were got from short and long term financing. Due to economic crises, and purchase the 100% acquisition of PAFL, company faces losses. Company is good for long term benefits. It had a great capacity to produce fertilizers and improve the quantity and quality of jeans and denim products and they are improving technology. They had implemented Enterprise Resource Planning software to increase the efficiency and for better management planning.

VERTICAL ANALYSIS

“An analysis of percentage financial statements where all balance sheet items are divided by total assets and all income statement items are divided by net sales or revenue” The expression of individual financial statement item as percentages of total helps the analyst spot trends with respect to the relative importance of these items over time. Balance Sheet

Vertical analysis is also called common size analysis. The common size balance sheet is also called 100% balance sheet. The total of assets is the base figures representing 100%. Every item of the balance sheet is related vertically to reflect the vertical mix against the total. The analysis represents internal composition of assets and liabilities. The common size balance sheet analysis reveals the sources of capital and all other sources and the application of sources to assets of the company. Profit And Loss Account

Similar method as applied for balance sheet is also applicable to profit and loss account. The various items of profit and loss account are related as percentage to sales. For example, items like, cost of goods sold. Operating expenses, gross profit, taxation etc. are reduced to percentages by treating the sales as 100 %. These ratios are also called vertical ratios and mix percentages.

AZGARD NINE PVT

LIMITED Profit and Loss Account for the year ended 31-12-208

Sales - Net Cost of Sales Gross Profit Administrativ e and selling expenses Operating Profit Other income - Net Finance cost Profit before Taxation taxation Profit after Taxation

2 008

2 007

2 006

2008

2007

2006

Rs.

Rs.

Rs.

Rs.

Rs.

Rs.

10,113, 499,351 (6,660, 223,767) 3,453, 275,584

6,628, 341,926 (4,620, 988,950) 2,007, 352,976

4,889, 681,966 (3,703, 361,406) 1,186, 320,560

1127 % -742 %

6 14% -428 % 1 86%

4 27% -324 % 1 04%

(603, 529,743)

(435 ,185,073)

(391, 290,338)

-40%

-34%

2,849, 745,841 620, 148,589 (2,470, 391,655) 999, 502,775 (102, 218,852) 897, 283,923

1,572, 167,903 641 ,224,883 (1,061, 933,212) 1,151, 459,574 (72 ,007,073) 1,079, 452,501

795, 030,222 1,122, 601,656 (657, 548,074) 1,260, 083,804 (115, 569,082) 1,144, 514,722

385% -67% 318%

1 46%

69%

69%

59%

98%

-275 %

-98%

-57%

111% -11% 100%

1 07% -7% 1 00%

1 10% -10% 1 00%

ANALYTICAL REVIEW OF VERTICLE PROFIT & LOSS ACCOUNT As we can see from the vertical profit and loss account the sales revenue increased in 2007 by 614% and in 2008 Increased by 1127%. Cost of sales also decreased in 2007 by 428% and it decreased by 742% in 2008, gross profit increased in 2008 by 385% as compared to 2007 and in 2007 it had increased by 186% as compared to 2006.

Selling and distribution expenses had decreased in 2008 by 67% and decreased in 2007 as compared to 2006 which was 40%. Financial charges showed decreasing trend in relation to sales with a decreased in 2008 as compare to 2007 and 2006 Other operating income had increased in 2007 and also increased in 2008 which is Greater then increase in 2007.Profit before taxation has increased in year 2006 and year 2007 and also in year 2008. In year 2008 the profit/loss before taxation was 111% and in 2007 the profit increase by 107% higher then year 2006 and in year 2006 the profit increase 110%. Finally the company is improving with the passage of time. Although the profits are not very adequate but the management is very confident that they are working hard and the company will prosper in coming years as most of the capital work has been completed.

AZGARD NINE PVT

LIMITED BALANCE SHEET AS AT 31 DECEMBER 2008 EQUITY AND LIABILITIES

2008

2007

2006

2008

2007

2006

Rs.

Rs.

Rs.

Rs.

Rs.

Rs.

14%

16%

16%

13%

15%

15%

10%

10%

8%

37%

41%

40%

1%

1%

1%

14%

19%

10%

10%

13%

15%

0%

0%

0%

SHARE CAPITAL AND RESERVES ISSUED, SUBSCRIBED AND PAID UP CAPITAL RESERVES Inappropriate Profit

Surplus on revaluation of property, Plant and equipment Non current liabilities Redeemable capital Secured Long term finance secured Liabilities against assets subject to finance lease Current Liabilities Current Portion of non current liabilities Short term Borrowings derivative financial liabilities Trade and other payables Due to related parties- unsecured Markup accrued on borrowings

3,827, 118,540

3,788 ,822,900

3,788, 838,900

3,532, 469,002 2,764, 494,959 10,124, 082,501

3,530 ,626,122 2,400 ,605,174 9,720 ,054,196

3,578, 262,182 1,807, 067,052 9,174, 168,134

219,35 6,257

239 ,073,077

257 ,360,867

3,962, 461,561 2,686, 842,500

4,491 ,185,372 2,973 ,551,252

2,268, 598,953 3,519, 216,988

25 ,210,944

1 4,357,005

6,674, 515,005

7,479 ,093,629

5,797, 438,559

24%

32%

25%

1,470, 921,493

981 ,049,256

450 ,047,125

5%

4%

2%

6,574, 080,304 50 ,536,909 1,350, 500,115 426 ,768,193 466 ,226,443

3,820 ,688,516 3 4,369,582 1,030 ,875,769

6,006, 117,630 32 ,021,607 1,243, 588,067

24%

16%

26%

0%

0%

0%

5%

4%

5%

317 ,690,929

195 ,249,017

2%

0%

0%

2%

1%

1%

9,622,618

Unclaimed dividend

Contingencies and commitments

14 ,686,046 10,353, 719,503

9,694,014 6,194 ,368,066

22 ,312,061 7,949, 335,507

27,371, 673,266

23,632, 588,968

23,178, 303,067

7,734, 950,547 918 ,670,893 33 ,536,216 7,521, 644,051 19 ,777,502 16,228, 579,209

7,643 ,649,558 167 ,987,854 5 1,142,669 6,391 ,905,201 2 0,239,502 14,274, 924,784

7,601, 895,866 150 ,650,477 60 ,544,809 6,303, 488,906 19 ,906,757 14,136, 486,815

201 ,693,270 4,034, 103,119 1,777, 232,612 175 ,673,993

125 ,468,877 2,246 ,132,173 1,657 ,196,735 388 ,993,278

101 ,762,486 2,022, 510,924 1,134, 897,149 555 ,680,244

789 ,515,062

1,004 ,944,292

857 ,744,304

63 ,948,605 4,018, 853,586 82 ,073,810 11,143, 094,057 27,371, 673,266

5 1,050,683 3,838 ,444,830 4 5,433,316 9,357 ,664,184 23,632, 588,968

3,788, 315,521 580 ,905,624 9,041, 816,252 23,178, 303,067

0%

0%

0%

38%

26%

34%

0%

0%

0%

100%

100%

100%

28%

32%

33%

3%

1%

1%

0%

0%

0%

27%

27%

27%

0%

0%

0%

59%

60%

61%

1%

1%

0%

15%

10%

9%

6%

7%

5%

1%

2%

2%

3%

4%

4%

0%

0%

0%

15%

16%

16%

0%

0%

3%

41%

40%

39%

100%

100%

100%

ASSETS Non-current assets Property, Plant and equipment Capital work in progress intangible assets Long term investments Long term deposits

Current assets Stores spares and loose tools Stock in trade Trade receivable Derivative financial assets Advances, deposits, prepayments and other receivables Current Taxation Short Term investment Cash and Bank Balances

ANALYTICAL REVIEW OF VERTICLE ANALYSIS OF BALANCE SHEET

ASSETS Non-Current Assets As we can see from the vertical balance sheet of the company total fixed assets are constant in relation to total assets with little variations. The management is more focusing on working capital management than on fixed asset in last three years as shown by the vertical balance sheet. Property, plant and equipment have shown a mix trend with improvement in year 2006 which was 33% and then a increase in 2007 which was 32% and after that improvement in last year 2008 that was 28% Capital work in progress was increased in 2006 as compare to 2007, Store spare held for capital expenditures increase in 2007 and 2008. Long-term deposits increased by 0.09% in 2006 and 0.06% and 0.03% increased in 2007 and 2008. Current Assets Total current assets have shown an increasing trend over the last three year period. Stores and spares declined in year 2007 after that it has shown an increasing trend. In 2006 it increased by 7.97%, n 20073.02% and in 2008 it was 5.40%. Stock in trade has shown an increasing trend while in the last year it shows a little decline. Stock in trade is about 2.93% of the total current assets in 2006 and it was 2.03% of total assets in 2007 and 1.34% in 32008. Stores and spares have the largest portion among all current assets. Receivable had 3.09% o total assets in 2006 and they were 1.90% in 2007 and 3.13% in 2008. Trade debtors were 0.70% in 2006, 0.35% in 2007 and 0.12% in 2008. Cash and cash equivalent were 21.34% in 2006, 2.15% in 2007 and 0.29% n 2008. This trend shows that more funds are tied in receivable, inventories and in stores & spares. EQUITY AND LIABILITIES Share capital and reserves have shown decreasing trend. Un-appropriated profit has shown decreasing trend and company had beard loss in 2008. The company is now focused on its expansion of projects to increase its capacity of production and improving since year 2005. Currently company is not paying dividends to shareholders. Issued, subscribed and paid up capital was 30.05% of total liabilities in 2006 but reduced up to 16.54% in 207 and it was 15.35% in 2008. Reserves were also decreased due to bonus issue they were 12.65%, 6.44% and 3.09% in 2006, 2007 and 2008 respectively.

Non-Current Liabilities

Total long-term liabilities of the company have shown increasing trend in relation to total liabilities except marginally increase in year 2008. The company is focusing on equity financing than debts due to the higher financing costs. Liabilities against assets have shown a mix trend over the last three year period. Long term financing was 7.71% in 2006, 43.93% in 2007 and 39.11% in 2008 to all of its liabilities. Current Liabilities Short term liabilities have shown an increasing trend during the last three years as shown in the vertical balance sheet of the company. Trade and other payables have shown an increasing trend with a marginal increase in last year. Trade payables deceased in 2007 and 2008; in 2006 they were 7.38%, 2.91%in 2007 and 3.21% in 2008. Sort term financing increased, it was 1.86% in 2006, 2.38% in 2007 and 14.387% in 2008.

CHAPTER # 03

1) Company Analysis 2) Company Life Cycle 3) Company award of the year 2008

COMPANY ANALYSIS:

Azgard nine limited fulfills all its targets of supplies in the market and also expands its production with the needs of market. In these days company is in its growth stage. Now the company has three production units including two units for textile produce and one for Fertilizers. The growth in demand of garments in Asia, India and Middle East, particularly supply deficit in Europe and USA has geared up export opportunities for garment Industry of Pakistan. Supply deficit in Europe has resulted in significant demand for Pakistani garment due to Europe’s geography. European’s import authority standards have approved Azgard nine for import to Europe. This demand will also be supported by closing down of some garment units in Europe due to their strict laws governing pollution control and other environment hazards. Being one of the big garment units of Pakistan and due to its high quality Azgard Nine is the prime of choice of the International buyers all over the world. Azgard Nine is committed to provide high quality garment to its international customers and is being exported to Germany, India, Middle East, Europe and Africa. Azgard Nine conveniently meets all the International standards including American, British, Indian and European standards.

Azgard Nine is an ISO

9001-2000 and ISO 14001-2004 certified company and follows all rules and regulations of the government. Company’s social performance is also good. It has good cooperation with community and the environment. It is only one company of Pakistan that has install water filtration plant in its production units in MANGA MANDI. Company has a good relation with their workers and also trying for their welfare.

Company Life Cycle

Last Five Years Sales of the Company

Comments:

In the above graph you can see in the year 2008 sale of the company at highest point and it is showing increasing trend from 2004 so company sale is at increasing side in the year of 2004 to 2008 there is no much difference between the sale this increasing trend due to expansion of plant and due to the consumption and the demand in the market so we can say that Azgard nine’s product’s demand is increasing in the local market and international market.

CHAPTER # 04

1. Five Years Review 2. Recommendation 3. Conclusion 4. Bibliography

FIVE YEARS REVIEW

Explanation:

In the above chat we can see the profit position of the company during the year 2004 to 2008 in these five years company profitability position is better in 2006 as compare it with other years, so we can say that company was in much better position in 2006.

Review For last five year review, In 2004, the profitability of the Company has increased considerably in year 2004 due to stability in the prices of Products and increase in capacity utilization. Company has earned after tax profit of Rs. 375.262 million after accounting for all charges. To meet the increasing demand for the product of Azgard Nine and maintain its shares in the market, company has planned to purchase a new Garment plant within the premises of Kasur. Company has started work on this new plant and its give help to meeting the demand to local and international markets. In 2005, sale revenue was Rs. 4422.472 million reflecting a growth of 40% over last year. The cost of sales has increased by 35% during the year, which is mainly due to persistent Prices hike in coal and furnace oil. The company has earned after tax profit of Rs 741.293 million. The profitability of the company has increased considerably in the current year due to stability in the prices of products and increase in capacity utilization. In 2006, sales revenue is Rs. 4889.68 million reflecting a growth of 11% over last year. The company has earned after tax profit of Rs. 1144.51 million. The profitability of the company has increased considerably in the current year due to better retention prices and new plant capacity utilization. In 2007, sales revenue for 2007 was Rs.6628.34 million reflecting increase of 36% from last year. The company has earned after tax profit of Rs. 1079.45 million. The profitability of the company has increased considerably in the current year due to better demand. In 2008, sales revenue was 10113.49 million reflecting an increase of 53% from previous year. The company has earned after tax profit of Rs. 897.28 million. Down fall in the profitability of the company is mainly attributable to increase in cost of input prices of coal and diesel etc.

RECOMMENDATIONS  The most important thing for improvement is that Company should Re-arrange

the responsibilities and authorities of all the major departments. Along with this there should be a proper check and balance system in order avoid from any sort of departmental overlapping.  The location of Head office is very critical for Company. It should near to Factory in order to handle all the operations in better way.  Company should remove unionized employees which are providing problems to management. For this purpose they should use Golden Hand Shake or other options.  The selection criteria should also be improved. The company should select the educated and experienced employees and along with there should be a proper training system for them.  The Company should be maintain and established the internal audit and accounting system according to the standard and requirement of the company ordinance 1984. The implementations of all these points can lead the company towards more productive way and after this its market growth and market share will enhance.

CONCLUSION

The textile & apparel sector is amongst the largest and most significant in Pakistan’s economy, accounting for over 60% of total merchandise exports and providing employment to 38% of large scale manufacturing sector workforce. There is an abundant supply of local raw material as Pakistan is the 4th largest producer in the world. There is also an abundance of local labor available at a competitive cost when benchmarked against regional competitors. Against this backdrop the industry remains largely fragmented with few large scale integrated players. Worldwide denim production capacity is over 6 billion linear meters. Denim is the world’s largest cotton textile product with estimated per annum global sales of 4 billion units. Azgard Nine is Pakistan’s largest denim products business by sales with a fully vertically integrated Manufacturing chain. From cotton to retail ready apparel products. In house capability for spinning. Weaving, Design, finishing and stitching enables control over the entire value chain and provides a significant competitive advantage in facilitating faster speed to market and control over product quality. With Longstanding relationship with global retailers and brands, and an ability to rapidly build up manufacturing capacity, Azgard nine is well poised to cater to an expected increase in global demand for denim products. The year 2008 proved very challenging due to a globally recessionary climate affecting all facets of the business. While the business remained under pressure, Azgard Nine was able to protect its value added services to its products portfolio. The key focus remained on meeting and indeed finding ways to exceed customer expectations. In addition to Azgard Nine’s vertical manufacturing capabilities which were already providing customers solution concepts was added. The company now offers the client a choice of full product development, product design and a complete logistics solution. Traditionally the customer has been sourcing supply of the product only. Now the client has the option to source a full supply chain solution directly from the Company. This value enhancement helped Azgard Nine to grow with its existing customers and add new customers as well during a difficult period. Urea industry in 2008 remained structurally short despite a 5% increase in production over 2007 (reaching 4.98 Million Tomes). Late arrival of imports further compounded the shortage across all the provinces. Total imports by the Trading Corporation of Pakistan (TCP) during 2008 aggregated 450000 tons. The shortage was managed by collaboration between the federal & provincial Governments and Fertilizer industry by systematically rationing the available stocks. The government of Pakistan, in an effort to

counter shortages utilized the network of national fertilizer marketing limited (NFML) & Utility Stores Corporation of Pakistan for selling 50% of local production during NovDec 2008. Pak American fertilizers ltd. played an active role in coordination with the relevant Government departments to ensure availability of fertilizer in various districts of Punjab and NWFP. Industry Urea sales in 2008 saw an increase of 11% over 2007 and reached 5.5 million tons. This increase is attributed to demand switch by farmers from phosphates to urea due to the unprecedented price increase of phosphate in the international market. The fertilizer industry supported the farmers in passing on various subsidies received. The fertilizer industry also contributed an additional subsidy of Rs. 20.7 billion given by the Government of Pakistan (GOP) in shape of lower gas prices to the fertilizer industry in 2008. The GOP also provided additional subsidy of Rs. 14.5 Billion on account of subsidy on import urea. Thus local Urea prices during 2008 averaged US$ 165.7 per tom, significantly lower than the average international urea price of US$ 550 per ton in 2008

BIBLIOGRAPHY REFERENCE & SOURCES USED 1) http://www.nishatmillsltd.com/nishat/invest.html 2) http://www.nonprofitsassistancefund.org/files/MNAF/ToolsTemplates/NonprofitFi

nancialRatios.pdf 3) http://www.azgard9.com/html/financial-info/2008/Security%20Analys_g%20-

%20Q1.pdf 4) http://www.azgard9.com/html/financial-info/2008/Consolidated%20ANL.pdf 5) http://www.azgard9.com/html/financial-

info/2008/Azgard%209%20AR07%20Consolidati%20(2).pdf 6) http://www.azgard9.com/html/financial-info/2007/ANNUAL%20REPORT-

2006%20PAGE%2021%20TO%20110.pdf 7) http://www.azgard9.com/html/financial-information.htm 8) http://www.sapphire.com.pk/cstmaccounts.htm 9) http://www.sapphire.com.pk/home.htm

10) http://www.kse.com.pk/market-data/history_by_date1.php?id=1&sid=1.20 11) Financial Management by (BPB) 12) Financial Reporting by (BPB) 13)www.investopedia.com 14)www.accountingformanagment.com

References Special Thanks to Mr. Muhammad Irfan

CHAPTER # 05

Annexure:

1) Five Years Balance Sheet of Azgard Nine Pvt limited Company 2) Five Years Profit and Loss account of Azgard Nine Pvt limited Company 3) Five Years Balance Sheet of Sapphire Mills limited Company 4) Five Years Profit and Loss account of Sapphire Mills limited Company 5) Five Years Balance Sheet of Nishat Mills limited Company 6) Five Years Profit and Loss account of Nishat Mills limited Company 7) Ratio Working of Azgard Nine, Sapphire and Nishat Company

AZGARD NINE PVT LIMITED BALANCE SHEET AS AT 31 DECEMBER 2008 2 008 EQUITY AND LIABILITIES

Rs.

2007 Rs.

2 006 Rs.

2 005

2 004

Rs.

Rs.

SHARE CAPITAL AND RESERVES ISSUED, SUBSCRIBED AND PAID UP CAPITAL RESERVES Inappropriate Profit

3,827,118,54 0 3,532,469,00 2 2,764,494,95 9 10 ,124,082,501

Surplus on revaluation of property, Plant and equipment Non current liabilities Redeemable capital Secured Long term finance secured Liabilities against assets subject to finance lease

Current Liabilities Current Portion of non current liabilities Short term Borrowings derivative financial liabilities Trade and other payables

219,356,257

3,962,461,56 1 2,686,842,50 0 25,210,944 6,674,515,00 5

1,470,921,49 3 6,574,080,30 4 50,536,909 1,350,500,11 5

3,78 8,822,900 3,53 0,626,122 2,40 0,605,174 9,72 0,054,196

2 39,073,077

4,49 1,185,372 2,97 3,551,252

14,357,005 7,47 9,093,629

9 81,049,256 3,82 0,688,516 34,369,582 1,03 0,875,769

3,788,838,9 00

1,737,308,6 80

1,737,308,6 80

3,578,262,1 82

403,331,46 9

362,142,241

1,807,067,0 52

952,462,49 0

410,657,982

9,174,168,1 34

3,093,102,6 39

2,510,108,9 03

257,360,86 7

278,943,67 1

306,564,511

2,268,598,9 53

2,333,220,1 75

1,147,729

3,519,216,9 88

347,920,00 0

750,000,000

9,622,618

40,173,972

116,503,819

5,797,438,5 59

2,721,314,1 47

867,651,548

450,047,12 5

433,780,77 4

363,081,881

6,006,117,6 30

3,142,402,3 24

1,492,909,8 92

32,021,607 1,243,588,0 67

791,641,17 2

691,981,192

Due to related partiesunsecured Markup accrued on borrowings Unclaimed dividend

426,768,193

466,226,443 14,686,046 10 ,353,719,503

Contingencies and commitments

Non-current assets Property, Plant and equipment Capital work in progress intangible assets Long term investments Long term deposits

3 17,690,929 9,694,014 6,19 4,368,066

27 ,371,673,266

ASSETS

-

2 008 Rs. 7,734,950,54 7 918,670,893 33,536,216 7,521,644,05 1 19,777,502 16 ,228,579,209

23,632 ,588,968

-

195,249,01 7 22,312,061 7,949,335,5 07 -

-

-

79,679,935

64,824,871

362,062

95,414

4,447,866,2 67 -

2,612,893,2 50 -

23,178,303, 067

10,541,226, 724

2,007

2,006

2,005

2,004

Rs.

Rs.

Rs.

Rs.

7,64 3,649,558 1 67,987,854 51,142,669 6,39 1,905,201 20,239,502 14,274 ,924,784

6,297,218,2 12

7,601,895,8 66

3,113,043,0 32

2,847,936,4 02

150,650,47 7

2,459,655,9 06

84,292,338

73,937,276

88,375,589

4,670,138

2,666,296

19,906,757

29,745,135

18,517,830

14,136,486, 815

5,681,051,4 87

3,041,788,4 55

101,762,48 6

87,790,355

72,608,693

2,022,510,9 24

2,034,180,5 50

1,394,729,3 30

1,134,897,1 49

1,013,883,5 84

945,111,856

555,680,24 4

13,458,916

60,544,809 6,303,488,9 06

Current assets Stores spares and loose tools

201,693,270

Stock in trade

4,034,103,11 9

Trade receivable

1,777,232,61 2

Derivative financial assets Advances, deposits, prepayments and other receivables Current Taxation Short Term investment Cash and Bank Balances

1 25,468,877 2,24 6,132,173 1,65 7,196,735

175,673,993

3 88,993,278

789,515,062

1,00 4,944,292

63,948,605 4,018,853,58 6 82,073,810

51,050,683 3,83 8,444,830 45,433,316

857,744,30 4

3,788,315,5 21 580,905,62

895,807,87 9

769,411,59 5 45,642,358

-

712,923,170

109,148,931 20,907,777

4 11 ,143,094,057

9,35 7,664,184

27 ,371,673,266

Profit and Loss Account for the year ended 31-12-208 2 008 Rs.

23,632 ,588,968

Rs.

Rs.

Rs.

Rs.

(4,620,988, 950)

Gross Profit

3,453,275,5 84

2,007,352,9 76

(603,529,74 3)

taxation Profit after Taxation Earning Per Share - Basic Earning Per Share - diluted

6,297,218,2 12

2,004

(6,660,223, 767)

Profit before Taxation

10,541,226, 724

2,005

Cost of Sales

Finance cost

23,178,303, 067

3,255,429,7 57

2,006

6,628,341,9 26

Administrative and selling expenses Operating Profit Other income - Net

4,860,175,2 37

2,007

1 0,113,499,3 51

Sales - Net

9,041,816,2 52

4, 889,681,966

4, 422,472,357

(3, 703,361,406)

(3,2 88,786,063)

1, 186,320,560

1, 133,686,294

(435,185,07 3)

(391,290,338)

( 320,622,883)

2,849,745,8 41

1,572,167,9 03

795,030,222

813,063,411

620,148,589

641,224,883

1, 122,601,656

305,447,731

(2,470,391, 655)

(1,061,933, 212)

(657,548,074)

( 326,374,206)

999,502,775

1,151,459,5 74

1, 260,083,804

792,136,936

395,262,335

(102,218,85 2)

(72,007,073 )

(115,569,082)

(50,843,271)

(20,000,000 )

897,283,923

1,079,452,5 01

1, 144,514,722

741,293,665

375,262,335

3,155,912,4 27 (2,440,779, 273) 715,133,154 (185,112,54 8) 530,020,606 9,864,791 (144,623,06 2)

2.65

3.26

4.97

7.42

4.31

2.65

3.25

4.67

6.47

4.30

NISHAT PVT. LIMITED BALANCE SHEET FOR THE YEAR ENDED 2008 2008 EQUITY AND LIABILITIES

2007

2006

2005

2004

CAPITAL AND RESERVES Reserves

1,59 7,857,000 23,549 ,323,000

1,59 7,857,000 28,56 6,041,000

1,452 ,597,000 19,659, 812,000

1,45 2,597,000 11,35 3,517,000

1,59 7,857,000 28,566 ,041,000

Accumulated profit

-

-

-

25,147,1 80,000

30,163,8 98,000

9,000

1,04 7,794,000

1,77 3,820,000

,353,000

-

-

1,000

Share Capital

Total Equity SHAREHOLDERS EQUITY NON CURRENT LIABILITIES Loan term finances liabilities against assets subject to finance lease

-

-

21,112,40

12,806,1 14,000

30,163,8 98,000

2,982

2,79 6,512,000

1,77 3,820,000

33,03 1,047,7 94,000

1,773,8 20,000

61,6 43,000

3,015,38 4,000

2,858,1

55,000

1,773,8 20,000

CURRENT LIABILITIES Trade and other 1,14 payables 1,227,000 Interest/ mark up on 20 loans 1,847,000

26,593,000

short term borrowings Current portion of long term liabilities Provision for income tax

1 31,744,000 5,01 8,664,000

15 1,236,000 4,315 ,708,000

92

1,34 1,565,000

,771,000

27 6,988,000 11,721,6 05,000

2 30,807,000 7,649,3 73,000

28 1,382,000 7,051,53 3,000

3 56,689,000 6,253,3 33,000

23 0,807,000 7,649,3 73,000

CONTIGENCY AND COMMETMENTS

-

-

-

-

-

TOTAL EQUITY AND LIABILITIES

37,916,5 79,000

39,587,0 91,000

6,000

21,917,6 02,000

39,587,0 91,000

9,17 5,518,000 6,025,000

ASSETS NON-CURRENT ASSETS Property, Plant and Equipment Capital Work in progress

2008 10,647,3 10,000 13,321,0 88,000

9

2007

0,436,000

96

1,342

31,179,32

2006

12,216,000

8

88,449,000 4,28 4,815,000 11,164,000

7

2005

6,593,000

92

13 1,744,000 5,01 8,664,000 1,34 1,565,000

2004

10,58 6,159,000

10,611, 353,000

9,15 1,096,000

2,42 9,954,944

15,67 2,980,000

10,793, 026,000

5,00 3,177,000

57,608,750

Loan term loanssecured and deposits Loan term loanssecured and deposits CURRENT ASSETS stores, spares parts and loose tools stock in trade Trade Debts Short term investments loans and advances Short term deposit and prepayments others receivables Cash and bank balances

TOTAL ASSETS

8,122,000

9,523,000

6,377,000

4,890,000

10,541,000 23,987,0 61,000

9,342,000 26,278,0 04,000

1 0,130,000 21,420,88 6,000

12,022,000 14,171,1 85,000

23,820,007 2,511,3 83,701

49 0,229,000 4,10 3,648,000 1,32 9,027,000

4 22,428,000 3,10 6,436,000 8 31,653,000

47 1,520,000 3,003 ,174,000 1,026 ,884,000

4 24,827,000 2,89 7,392,000 8 77,358,000

1,24 9,572,742

7,12 9,154,000 40 3,295,000

8,11 8,459,000 4 11,270,000

4,350

2,17 3,530,000 4 24,533,000

30,400,000

26,395,000

0,013,000

37

22,839,000

3

,146,000

8,794,000 0,525,000 7,147,000

41 3 40

39,180,000 88,598,000

3

1,15 0,579,738 9,138,820 5,255,091

10 24

13,497,444 -

73,752,000 13,929,5 18,000

69,607,000 13,309,0 87,000

5 0,250,000 9,758,44 0,000

5 20,999,000 7,746,4 17,000

56,528,131 2,824,5 71,966

37,916,5 79,000

39,587,0 91,000

31,179,32 6,000

21,917,6 02,000

55,667

NISHAT PVT. LIMITED PROFIT & LOSS A/C

5,335,9

FOR THE YEAR ENDED 2008 2008

2007

2006

2005

2004

SALES COST OF SALES

(14,33 5,254,000)

    16,417,3 58,000    (13,701,6 26,000)

  11,374,6 30,000    (9,239,7 31,000)

2,9 68,776,000

2,84 4,938,000

2,7 15,732,000

2,1 34,899,000

(9 61,711,000)

(9 28,778,000)

(3 98,757,000)

(3 20,202,000)

(1 10,781,000)

91,758,000)

5,8 06,873,000 4,335, 624,000

6 71,275,000 (669,4 63,000)

       (663, 671,000)        (264, 807,000)          (78, 689,000)          277, 961,000  (729, 206,000)

     (510,2 46,000)      (175,0 40,000)        (70,9 78,000)        621,5 69,000  (134,6 95,000)

7,3 04,400,000

2,17 5,475,000

1,9 86,526,000

2,0 00,204,000

(9 07,432,000)

(8 19,267,000)

-

-

     (407,6 96,000)        440, 846,000 

(9 07,432,000)

(8 19,267,000)

       (755, 054,000)          527, 394,000  ( 227,660,000)

33,150,000

0,805,144

19,26 7,633,000

17,18 0,192,000

(16,29 8,857,000)

7,46 1,055,757 7,09 1,114,328

GROSS PROFIT 14,55 2,170,085

DISTRIBUTION COST ADMINISTRATIVE EXPENSES OTHER OPERATING OTHER OPERATING INCOME

(

54,689,456 27,986,950 11 1,644,873 194,3 21,279

OPERATING PROFIT 14,74 6,491,364

FINANCE COST share of profit in associated companies

7,260,241

12

13,544,903 14

PROFIT BEFORE TAXATION 1,758,

968,000

6,396, 08,000

1,356,2 866,000

2,033, 354,000

14,887,2 96,508

(2 58,000,000)

(1 45,000,000)

( 126,000,000)

(1 66,000,000)

85,046,149

6,138,

1,211,2

1,632,

TAXATION PROFIT AFTER TAXATION 968,000

SHAPPHIRE (PVT).

08,000

866,000

1,867, 354,000

14,972,3 42,657

LIMITED BALANCE SHEET FOR THE YEAR ENDED 2008 ASSETS

2008

2007

2006

2005

2004

NON-CURRENT ASSETS Property, Plant and Equipment

3,936, 3,793,62 3,721,36 3,124,15 2,429,95 357,164 1,479 8,562 2,756 4,944

Capital Work in progress

136, 665,017 7,308 1,

Intangible Assets

035,155

Investment Property

660,297

Long term Investment

455,739

Loan term loanssecured and deposits

609,945

309,35

202,11 9,669

1,86

166,67 4,519

2,69

57,60 8,750

3,51

3,283

1,411

9,539

-

-

-

140,

333,58

550,

400,08 7,567

18,

404,68 7,567

27,88 6,920

1,557 359,68

7,567 24,22

4,793

26,17

9,194

23,82 0,007

4,78 4,532,8 4,355,0 3,680,2 2,844,96 3,783,317 16,557 92,002 13,575 5,258

CURRENT ASSETS Inventories

3,278, 1,949,14 1,908,73 1,860,86 1,249,57 652,891 6,494 4,607 3,775 2,742

Trade Debts

1,129, 1,280,85 1,181,49 976,38 1,150,57 634,217 2,424 1,096 2,566 9,738

Loan and advances

803,031

7,608

6,776

5,687

8,820

Investments

-

-

-

-

5,091

Advance/ refundable income tax

288,064

Trade deposits and short term prepayments

173,454

Other receivables

562,147

Short term investments

2,821, 3,032,18 1,521,73 503,64 493,005 0,857 2,569 4,001 -

Cash and bank balances

874,980

61,

115,67

41,51

31,16

109,13

245,25

96,

36,98 5,119

7,

51,61 3,256

5,25 3,941

78,

3,30 0,053

119,31 6,598

66,

1,22

121,59

47,12

5,900

33,31 2,085

131,02 1,514

8,857

8,423

53,77 4,469

176,04 1,185

13,49 7,444

41,25 6,301

56,52 8,131

7,54 6,593,1 4,863,2 3,637,7 2,955,59 0,481,789 87,510 98,865 08,272 3,480

TOTAL ASSETS

12,32 11,126,0 9,218,3 7,317,9 5,800,55 4,265,106 04,067 90,867 21,847 8,738

EQUITY AND LIABILITIES CAPITAL AND RESERVES 200,

200,83

200,83

200,83

200,83

Share Capital

831,400

Reserves

4,758, 5,601,77 3,558,56 2,307,51 1,954,79 930,127 4,092 1,976 0,163 5,027

Accumulated profit

730,082

Total Equity

5,57 6,018,8 3,893,9 2,797,1 2,327,93 7,491,609 68,330 28,464 14,637 3,429

1,400

617,

1,400

216,26 2,838

1,400

134,53 5,088

1,400

288,77 3,074

172,30 7,002

SHAREHOLDERS EQUITY NON CURRENT LIABILITIES Redeemable Capital

-

Loan term finances

501,210

6,877

Custom duty payable

-

8,878

Deferred liabilities

39 407,3 366,27 326,71 279,46 6,649,544 55,062 8,699 0,352 2,992

469,

734,94

934,38

0,957 18

1,188,01

7,068 18

8,878

940,30 4,765

18 8,878

18 8,878

86 1,142,4 1,300,8 1,514,9 1,219,95 6,150,754 90,817 48,534 16,298 6,635

CURRENT LIABILITIES 490,

371,95

667,34

575,33

505,96

Trade and other payables

810,513

Interest/ mark up on loans

211,756

short term borrowings

4,923, 3,109,23 2,611,40 1,933,61 1,540,81 882,728 2,345 2,600 0,996 9,433

Current portion of long term liabilities

903,996

3,492

6,109

Current portion of gratuity fund

-

-

8,287

2,583 82,

9,055 71,19

6,500

322,

0,266 58,95

4,600

347,06

1,833 45,08

1,569

603,23

-

352,34

147,89

3,252

6,239

-

-

24,07

60,

65,20

58,27

99,13

57,62

Provision for income tax

813,750

0,000

9,967

Dividend payable

-

-

3,251

CONTIGENCY AND COMMETMENTS

5,88 3,964,6 4,023,6 3,005,8 2,252,66 0,622,743 44,920 13,869 90,912 8,674

TOTAL EQUITY AND LIABILITIES

12,32 11,126,0 9,218,3 7,317,9 5,800,55 4,265,106 04,067 90,867 21,847 8,738

3,295 31

SHAPPHIRE (PVT). LIMITED

9,936 39

1,534

36 1,233

PROFIT & LOSS A/C FOR THE YEAR ENDED 2008

SALES COST OF SALES GROSS PROFIT DISTRIBUTION COST ADMINISTRATIVE EXPENSES OTHER OPERATING OTHER OPERATING INCOME

2008 9,746, 607,946 8,618, 580,605 1,128, 027,341

2007 9,152, 455,933 7,961, 253,425 1,191, 202,508

442, 316,060

2006 7,966, 281,051 7,201, 536,030 764, 745,021

391, 366,747

115,0

41, 676,645

91,

86,239

860,697

500,000

367,023

77,

835, 277,

27,98 6,950

51, 726,587

73, 451,728

54,68

20,

59,

403,

369,94 1,429

9,456

088,074

902,250

7,091,11 4,328

49,

13,

95, 620,045

5,757

-

747,754

866,302

2004 7,461,05

29, 575,561

811,031 16,

158,563

2005 5,338, 810,168 4,734, 528,479 604, 281,689

111,64 4,873

47,

974,422

OPERATING PROFIT

1,405, 283,605

228,086

293,293

596,887

9,896

RE-MEASUREMENT OF HELD FOR TRADING INVESTMENTS

-

-

-

-

1,601

FINANCE COST

683,187

520,225

833,551

923,488

0,241

OTHER CHARGES

-

-

-

-

4,903

787,

684,802

28,96

256,264

691,

8,467 556,

398,90

75 734,

467,

427,

174,

127,26 13,54

734, 683,187

PROFIT BEFORE TAXATION

600,418

TAXATION

870,336

PROFIT AFTER TAXATION

730,082

467, 520,225

670,

427, 833,551

319, 707,861

52,

263, 459,742

103, 445,023

617,

381,

128,

257,35 3,151

92, 900,325

134, 535,088

141,55 6,745

673,399

924,654

216, 262,838

174, 923,488

85,04 6,149

288, 773,074

172,30 7,002

Ratio analysis current assets/current current ratio liabilities year 2008 2007 2006 (935766418 (11143094057 (9041816252 Azgard 9 4/61943680 /10353719503) /7949335507) 66)

2005 (486017523 7/44478662 67)

2004 (325542975 7/26128932 50) (295559348 0/22526686 74)

Sapphire

(7540481789 /5880622743)

(659318751 0/39646449 20)

(4863298865 /4023613869)

(363770827 2/30058909 12)

Nishat

(1392951800 0/1172160500 0)

133090870 00/7649373 000

(9758440000 )/7051533000

(774641700 (282457196 0)/62533330 6)/76493730 00 00

quick ratio quick ratio year Azgard 9

Sapphire

Nishat

(current assets-stock)/current liabilities 2008 2007 2006 2005 2004 (935766418 (486017523 (325542975 (1114309405 (9041816252 47772246132173 2034180550 1394729330 4034103119)/ 2022510924)/ )/61943680 )/444786626 )/261289325 10353719503 7949335507 66 7 0 (659318751 (363770827 (295559348 (7540481789 (4863298865 0201949146494 1860863775 1249572742 3278652891)/ 1908734607)/ )/39646449 )/300589091 )/225266867 5880622743 4023613869 20 2 4 (1392951800 04103648000)/ 11721605000

inventory day

(133090870 003106436000 )/76493730 00

(9758440000 3003174000)/ 7051533000

(774641700 (282457196 062897392000 0)/76493730 )/625333300 00 0

Inventory Days year

Inventory Days = Inventory / Cost of Sales*365 2008 2007 2006 2005

2004

Azgard 9

(4034103119/ 6660223767)* 365

(224613217 3/46209889 50)*365

(2022510924 /3703361406) *365

(203418055 0/32887860 63)*365

(139472933 0/24407792 73)*365

Sapphire

(3278652891 /8618580605) *365

(194914649 4/79612534 25)*365

(1908734607 /7201536030) *365

(186086377 (124957274 5/47345284 2/709111432 79)*365 8)*365

Nishat

(4103648000 /16298857000 )*365

(310643600 (3003174000 0/14335254 /13701626000 000)*365 )*365

(289739200 0/92397310 00)*365

(0/7091114 328)*365

2005

2004

Debtor's day Debtor's day year

Trade debtors/Credit sales*365 2008 2007 2006

Azgard 9

(1777232612 /10113499351 )*365

(165719673 5/66283419 26)*365

(1134897149 /4889681966) *365

(101388358 4/44224723 57)*365

(945111856 /315591242 7)*365

Sapphire

(1129634217/ 9746607946)* 365

(128085242 4/91524559 33)*365

(1181491096 /7966281051) *365

(976382566 /533881016 8)*365

(115057973 8/74610557 57)*365

Nishat

(1329027000 /19267633000 )*365

(831653000 (1026884000 /171801920 /16417358000 00)*365 )*365

(877358000 /113746300 00)*365

(115057973 8/74610557 57)*365

Creditors days Creditors days

Trade Creditors/Credit Sales*365

year

2008

2007

2006

2005

2004

Azgard 9

(1350500115/ 10113499351) *365

(103087576 9/66283419 26)*365

(1243588067 /4889681966) *365

(791641172 /442247235 7)*365

(691981192 /315591242 7)*365

Sapphire

(490810513/ 9746607946)* 365

(371952583 /915245593 3)*365

(667349055/ 7966281051) *365

(575330266 /533881016 8)*365

(505961833 /746105575 7)*365

Nishat

(1141227000/ 19267633000) *365

(926593000 /171801920 00)*365

(960436000/ 16417358000 )*365

(812216000 /113746300 00)*365

(926593000 /746105575 7)*365

2006

2005

2004

Total Asset Turnover Formula year

Sales/ Total Assets 2008

2007

Azgard 9

(1011349935 1/2737167326 6)

(662834192 (4889681966 6/23632588 /23178303067 968) )

(442247235 7/10541226 724)

(315591242 7/62972182 12)

Sapphire

(9746607946 /12324265106 )

(915245593 3/11126004 067)

(7966281051 /9218390867)

(533881016 8/73179218 47)

(746105575 7/58005587 38)

Nishat

(1926763300 0/3791657900 0)

(171801920 (1641735800 00/3958709 0/3117932600 1000) 0)

(113746300 00/2191760 2000)

(746105575 7/53359556 67)

2005

2004

Fixed Asset Turnover Ratio Formula year

Cost of sales / Fixed Assets 2008 2007

2006

Azgard 9

(6660223767 /7734950547)

(462098895 0/76436495 58)

(3703361406 /7601895866)

(328878606 3/31130430 32)

(244077927 3/28479364 02)

Sapphire

(8618580605 /3936357164)

(796125342 5/37936214 79)

(7201536030 /3721368562)

(473452847 9/31241527 56)

(709111432 8/24299549 44)

Nishat

(1629885700 0/1064731000 0)

(143352540 (1370162600 00/1058615 0/1061135300 9000) 0)

(923973100 0/91510960 00)

(709111432 8/24299549 44)

2006

2005

2004

Gross profit to Sales Formula year

Gross profit/Sales*100 2008 2007

Azgard 9

(3453275584 /10113499351 )*100

(200735297 6/66283419 26)*100

(1186320560 /4889681966) *100

(113368629 4/44224723 57)*100

(715133154 /315591242 7)*100

Sapphire

(1128027341/ 9746607946)* 100

(119120250 8/91524559 33)*100

(764745021/ 7966281051) *100

(604281689 /533881016 8)*100

(369941429 /746105575 7)*100

Nishat

(2968776000 /19267633000 )*100

(284493800 (2715732000 0/17180192 /16417358000 000)*100 )*100

(213489900 0/11374630 000)*100

(369941429 /746105575 7)*100

Operating Profit Margin Formula

year

Operating Profit Margin = Operating profit /Sale*100 2008 2007 2006

2005

2004

Azgard 9

(2849745841 /10113499351 )*100

(157216790 3/66283419 26)*100

(795030222/ 4889681966) *100

(813063411 /442247235 7)*100

(530020606 /315591242 7)*100

Sapphire

(1405283605 /9746607946) *100

(787228086 /915245593 3)*100

(691293293/ 7966281051) *100

(556596887 /533881016 8)*100

(398909896 /746105575 7)*100

Nishat

(7304400000 /19267633000 )*100

(217547500 (1986526000 0/17180192 /16417358000 000)*100 )*100

(200020400 0/11374630 000)*100

(564262708 /746105575 7)*100

2006

2005

2004

Net Profit/ (Loss) Before Tax Formula year

Net profit before tax/Sales*100 2008 2007

Azgard 9

(999502775/ 10113499351) *100

(115145957 4/66283419 26)*100

(1260083804 /4889681966) *100

(792136936 /442247235 7)*100

(395262335 /315591242 7)*100

Sapphire

(670600418/ 9746607946)* 100

(319707861 /915245593 3)*100

(263459742/ 7966281051) *100

(381673399 /533881016 8)*100

(257353151 /746105575 7)*100

Nishat

(6396968000 /19267633000 )*100

(135620800 (1758866000 0/17180192 /16417358000 000)*100 )*100

(203335400 0/11374630 000)*100

(705067852 /746105575 7)*100

Net Profit/ (Loss) after interest and Tax Formula year

Net profit after tax/Sales*365 2008 2007

2006

2005

2004

Azgard 9

(897283923/ 10113499351) *100

(107945250 1/66283419 26)*100

(1144514722 /4889681966) *100

(741293665 /442247235 7)*100

(375262335 /315591242 7)*100

Sapphire

(617730082/ 9746607946)* 100

(216262838 /915245593 3)*100

(134535088/ 7966281051) *100

(288773074 /533881016 8)*100

(172307002 /746105575 7)*100

Nishat

(6138968000 /19267633000 )*100

(121120800 (1632866000 0/17180192 /16417358000 000)*100 )*100

(186735400 0/11374630 000)*100

(790114001 /746105575 7)*100

2006

2005

2004

Azgard 9

(897283923/ 27371673266) *100

(107945250 (1144514722 1/23632588 /23178303067 968)*100 )*100

(741293665 /105412267 24)*100

(375262335 /629721821 2)*100

Sapphire

(617730082/ 12324265106) *100

(216262838 /111260040 67)*100

(134535088/ 9218390867) *100

(288773074 /731792184 7)*100

(172307002 /580055873 8)*100

Nishat

(6138968000 /37916579000 )*100

(121120800 (1632866000 0/39587091 /31179326000 000)*100 )*100

(186735400 0/21917602 000)*100

(790114001 /533595566 7)*100

Return on Assets Formula year

Net Income / Total Assets*100 2008 2007

Return on Capital employed Formula year

Profit before interest and taxation / Capital Employed *100 2008 2007 2006 2005

2004

Azgard 9

(999502775/ 17017953763) *100

(115145957 (1260083804 4/17438220 /15228967560 902)*100 )*100

(792136936 /609336045 7)*100

(395262335 /368432496 2)*100

Sapphire

(670600418/ 6443642363)* 100

(319707861 /716135914 7)*100

(263459742/ 5194776998) *100

(381673399 /431203093 5)*100

(257353151 /354789006 4)*100

Nishat

(6396968000 /26194974000 )*100

(135620800 (1758866000 0/31937718 /24127793000 000)*100 )*100

(203335400 0/15664269 000)*100

(705067852 /2313417333 )*100

Return on equity Ratio (ROE) Formula

Azgard 9

Sapphire

Nishat

[(Net profit after tax − Preference dividend) / Equity share capital] × 100 2008 2007 2006 2005 2004 ((10794525 ((1144514722 ((74129366 ((375262335 ((8972839230150)/101240825 0)/9720054 0)/917416813 0)/30931026 0)/25101089 01)*100 196)*100 4)*100 39)*100 03)*100 ((21626283 ((28877307 ((172307002 ((617730082((134535088840)/557749160 0)/389392846 0)/6018868 0)/27971146 0)/23279334 9)*100 4)*100 330)*100 37)*100 29)*100 ((6138968000 0)/251471800 00)*100

((12112080 000)/3016389 8000)*100

((1632866000 0)/211124090 00)*100

((18673540 ((790114001 000)/12806114 0)/30163898 000)*100 000)*100

Debt to Equity Ratio Formula

Total Long Term Debts / Shareholders Funds 2008 2007 2006

2005

2004

Azgard 9

(6674515005/ 7359587542)

(747909362 9/73194490 22)

(5797438559/ 7367101082)

(272131414 7/21406401 49)

(867651548/ 2099450921 )

Sapphire

(469501210/4 959761527)

(734946877 /580260549 2)

(934380957/3 759393376)

(118801706 8/25083415 63)

(940304765/ 2155626427 )

Nishat

(1047794000/ 25147180000)

(177382000 0/30163898 000)

(3015384000/ 21112409000)

(285815500 0/12806114 000)

(177382000 0/30163898 000)

Interest Coverage Ratio Formula

Azgard 9 Sapphire Nishat

Net Profit Before Interest and Tax / Fixed Interest Charges] 2008 2007 2006 2005 2004 (115145957 (999502775/2 (1260083804/ (792136936/ (395262335/ 4/10619332 470391655) 657548074) 326374206) 144623062) 12) (216262838 (617730082/7 (134535088/4 (288773074/ (172307002/ /467520225 34683187) 27833551) 174923488) 127260241) ) (135620800 (203335400 (6396968000/ (1758866000/ (705067852/ 0/81926700 0/40769600 907432000) 755054000) 127260241) 0) 0)

Earning Per Share Formula

Azgard 9 Sapphire Nishat

Profit after tax/No. of shares 2008 2007 (107945250 (897283923/3 1/33112039 38597707) 9) (617730082/2 (216262838 0082252) /20080115) (121120800 (6138968000/ 0/15978997 159785736) 4)

2006

2005

2004

(1144514722/ 230284652)

(741293665/ (375262335/ 99904807) 87067827)

(134535088/2 0079864)

(288773074/ (172307002/ 20095551) 20082401) (186735400 (790114001/ 0/14520637 152826693) 6)

(1632866000/ 159771625)

Earning Yield Formula Azgard 9

Earning Per Share / Market Price Per Share * 100 2008 2007 2006 2005 (2.65/61.56)* (3.26/52.1)* (4.97/22.05)* (7.42/32)*1 100 100 100 00

2004 (4.31/22.5)* 100

Sapphire

(30.76/72.45) *100

(10.77/92.5) *100

(6.7/70)*100

(14.37/90)* 100

(8.58/70)*10 0

Nishat

(38.42/85.97) *100

(7.58/129.2) *100

(10.22/104.8) *100

(12.86/76)* 100

(5.17/52.8)* 100

2006 22.05 70 104.8

2005 32 90 76

2004 22.5 70 52.8

Market price per equity share / Earnings per share 2008 2007 2006 2005 (61.56/2.65) (52.1/3.26) (22.05/4.97) (32/7.42) (72.45/30.76) (92.5/10.77) (70/6.7) (90/14.37) (85.97/38.42) (129.2/7.58) (104.8/10.22) (76/12.86)

2004 (22.5/4.31) (70/8.58) (52.8/5.17)

Market Value of Share Azgard 9 Sapphire Nishat

2008 61.56 72.45 85.97

2007 52.1 92.5 129.2

Price Earning Ratio Formula Azgard 9 Sapphire Nishat