Ibf Report

Blessed Textiles Limited

IBF Report 2007

1

Blessed Textiles Limited

A REPORT ON FINANACIAL STATEMENT ANALYSIS

BY RAHEEL AMJAD MEHMOOD FA06- MM-0104

SUBMITED TO MR. ASIF MAJI

IBF Report 2007

2

Blessed Textiles Limited

SERIAL NO.

Particular

Page No.

1

Acknowledgment

3

2

Company profile

4

3

Vision and mission statements

5

4

Ratio analysis

6

5

Common size Income statement

13

6

Common size Balance Sheet

14

8

Internal and sustainable growth rate

15

9

Proforma balance sheet

16

10

Proforma income statement

17

11

Cross sectional analysis

18

12

Time series analysis

22

13

Conclusion

26

14

Recommendation

27

IBF Report 2007

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Blessed Textiles Limited

First of all I would like to thanks to the mighty ALLAH that he courage me to complete this project. Secondly I would like to thanks to my dear teacher Mr. Asif Nagi he has assigned me to write this report. I have putted my best to complete this report. It is honor for me to write a final report of BLESSED TEXTILE LIMITED. At last but not the least I really great full to Mr. Raheel (TA) he helped me a lot complete this report.

IBF Report 2007

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Blessed Textiles Limited

Established in 1982, Umer Group of Companies headquartered in Karachi, Pakistan, today enjoys an annual turnover of 9 billion Pakistani rupees – approximately US $150 million. The group has invested more than US $10 million in recent years to expand its textile facilities to meet the international demand for its yarns and fabrics. The Umer Group is involved in textile, power generation, footwear, tannery and construction activities. The textile group comprises of three companies: Bhanero Textile Mills Ltd., Faisal Spinning Mills Ltd, and Blessed Textile Ltd., all three operating both spinning and weaving facilities. Umer Group has a total of five spinning mills with an installed capacity of 140,000 spindles supported by the latest European and Japanese machinery. The spinning and weaving mills are equipped with state-of-the-art laboratory equipment to test every step of the spinning process to ensure high quality. The yarn is produced for the domestic industry, in-house consumption and export to the European Union and Far East. We also produce yarn using organic cotton, linen cotton and are certified vendors for supima, DuPont and Cotton USA. Umer Group’s weaving mills feature more than 500 air-jet weaving machines from Japan and Belgium. Greige fabrics – produced for sheeting, denim and apparel – range from 170 centimeters to 340 centimeters in width. The weaving mills produced over 6 Million meters of fabric monthly. One of the associated company Firhaj Footwear has the exclusive manufacturing license of Hush Puppies International USA and the distribution license of Caterpillar in Pakistan. The growth rate of Hush Puppies shoes has the second largest growth rate in the world. Umer Group of companies currently employs more than 6,000 people. Umer Group of Companies recognizes the importance of expanding its business all the time. It is always on the lookout for new ideas and possibilities, is ever present in the research and development field. Looking to expand its outlook, the Umergroup of Companies is aggressive but most importantly diligent in fully researching and testing the markets before entering a new field.

IBF Report 2007

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Blessed Textiles Limited

A Leader Company maintaining An excellent level of ethical and Professional standards

To become top quality Manufacturer of textile product In the international & Local market

IBF Report 2007

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Blessed Textiles Limited

 Current ratio analysis = Current assets Current liabilities 2004 484771547 416562083 = 0.08681

2005 669453756 660440131 = 0.07481

2006 762605172 945704388 = 0.01481

 Quick ratio analysis = Current assets – inventory – prepaid expenses Current liabilities OR = Cash + M Securities + A/ Receivable Current liabilities 2004 21200576 416562083 = 0.51 : 1

2005 290418597 660440131 = 0.44 : 1

 Cash ratio analysis = 2004 35897769 416562083

2006 153823972 945704388 = 0.16 : 1

Cash Current liabilities

2005 4875025 660440131

2006 14070551 945704388

 Working capital = Current assets – current liabilities 2004 484771547 – 416562083 = 68209464

2005 669453756 – 660440131 = 9013625

 Debt ratio = Total liabilities Total assets 2004 2005 901839691 1288342416 123583830836 1765458338 = 0.0073 : 1 = 0.73 : 1

IBF Report 2007

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2006 762605172 – 945704388 = ( 183099216 )

2006 1756697534 2440626442 = 0.72 : 1

Blessed Textiles Limited  Debt to equity ratio = Total liabilities or total debts Total share holder equity 2004 901839691 394415762 = 2.29 : 1

2005 1288342416 477115922 = 2.7 : 1

2006 1756697534 602110725 = 2.9 : 1

 Time interest earned = Operating profit (EBIT) Interest expense 2004 111357526 31811540 = 4 times

2005 152544556 48601883 = 3 times

 A/ Receivable turnover = 2004 1057784180 176107807 = 6 times

Net credit sale Average A/receivable

2005 1511120256 208675689 = 7 times A/R TURNOVER

12 10 8 TIME 6 4 2 0

2004

2005 2006

INDUSTRY YEARS + INDUSTRY

IBF Report 2007

2006 321983323 151466216 = 2 times

8

2006 2027425775 190498493 = 11 times

Blessed Textiles Limited  Average collection period = 2004

365 Account receivable

2005 360 3 = 120 days

360 4 = 90 days

2006 360 11 = 33 days

Average Collection Days

120 100 80 DAYS 60 40 20 0 2004 2005 2006 INDUSTRY YEARS + INDUSTRY  Inventory turnover = 2004 915761160 198027775 = 5 times

Cost of good sold Average inventory

2005 1308230228 240462299 = 6 times

 Fixed assets turnover = 2004 1057784180 67982521 = 15 times

IBF Report 2007

2006 2510615756 374744868 = 7 times

356 Fixed assets

2005 1511120256 882288989 = 2 times

9

2006 2927425775 1658154233 = 2 times

Blessed Textiles Limited  Total assets turnover =

Net sale Total assets 2005 1511120256 1765458338 = 1 times

2004 1057784180 227088318 = 5 times

2006 2927425775 2440626442 = 1 times

Total Asstes Turnover

5 4 In %

3 2 1 0

2004

2005

2006

INDUSTRY

YEARS + INDUSTRY

 Gross profit margin = Gross profit Net sales 2004 2005 161483023 202890029 1057784180 1511120256 = 15 % = 14 % Gross Profit Margin

30 25 20 In % 15 10 5 0

2004

2005

2006

INDUSTRY

YEARS + INDUSTRY

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10

2006 417218458 2927425775 = 14 %

Blessed Textiles Limited  Operating profit margin = Operating profit Net sales 2004 111357526 1057784180 = 11 %

2005 152544556 1511120256 = 10 %

2006 321983323 2927425775 = 11 %

Operating Profit Margin

20 15 In % 10 5 0

2004

2005

2006

INDUSTRY

YEARS + INDUSTRY

 Net profit margin = Net profit Net sales 2004 2005 54452436 87524701 1057784180 1511120256 = 5.15 % = 5.8 % Net Profit Margin

18 16 14 12 10 In % 8 6 4 2 0

2004

2006

INDUSTRY YEARS + INDUSTRY 2005

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2006 129818803 2927425775 = 4.43 %

Blessed Textiles Limited  Return on assets = Net profit Total assets 2004 2005 54452436 87524701 1321911000 1765458338 =4% =5%

2006 129181803 2440626442 = 5.2 %

Return On Assets

16 14 12 10 In % 8 6 4 2 0

2004

2006

INDUSTRY YEARS + INDUSTRY 2005

 Return on equity = 2004 54452436 394415762 = 13.8 %

Net profit Total share holder equity 2005 2006 87524701 129818803 477115922 602110725 = 18.3 % = 21.5 % Return On Equity

25 20 In %

15 10 5 0

2004

2005

2006

INDUSTRY

YEARS + INDUSTRY

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Blessed Textiles Limited  Earning per share = Net profit after tax Number of share outstanding 2004

2005

54452436 6432000 = 8.5 per share

87524701 6432000 = 13.6 per share

2006 129818803 6432000 = 20 per share

Earning Per Share

20 15 In % 10 5 0

2004

2006 INDUSTRY YEARS + INDUSTRY 2005

 Dividend per share = Dividend paid Number of share outstanding 2004 4807909 64320000 = 0.075 per share

2005 4824000 6432000 = 0.075 per share

2006 4807909 64320000 = 0.075 per share

 Price earning ratio = Market price Earning per share 2004 10 \ 8.5 = 1.17 : 1

IBF Report 2007

2005 10 \13.6 = 0.73 : 1

2006 10 \ 20 = 0.5 : 1

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Blessed Textiles Limited

BLESSED TEXTIEL LIMITED COMMON SIZE INCOME STATEMENT FOR THE YEAR ENDED 30,2006 Amount 2006 Net sale

%

Amount 2005

%

Amount 2004

2927425775

100

1511120257

100

1057784180

(2510615756)

(85.8)

(1308230228)

(86.6)

915761160

416810019

14.2

202890029

13.4

142023020

408439

0.014

417218458

14.2

202890029

13.4

142023020

(51661990)

(1.8)

(20788533)

(1.4)

(14551973)

(34459748)

(1.18)

(23083321)

(1.5)

(16158325)

(9113397)

(0.31)

(6473619)

(0.43)

(4531533)

(151466216)

(5.77)

(48601883)

(3.21)

(34021318)

(246701351)

(8.46)

(98947356)

(6.5)

(69263149)

profit before tax

170517107

5.8

103942673

6.9

72759871

provision for tax

(40998304)

(1.4)

(16417972)

(1.09)

(11492580)

profit after tax

129818803

4.4

87524701

5.8

61267291

Cost of good sold Gross profit Other operating income

Distribution cost Administrative expenses Other operating expenses finance cost

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---

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Blessed Textiles Limited

Equities and liabilities Share capital and reserves AUTHORIZED CAPITAL 6500,000(8006'5600,000) ordinary share Holder of Rs. 10 each Issued and subscribed and paid up capital General reserves Unappropriated profit Non current liabilities Long term financing secured Liabilities again assets subject to finance lease Long term muarbaha secured Deferred liabilities CURRENT LIABILITIES Trade and other payable Make up secured on lone Short term borrowing secured Current portion of long term borrowing Provision for taxation

BLESSED TEXTIEL LIMITED COMMON SIZE BALANCE SHEET FOR THE YEAR 30,2006 Amount 2006 % ENDED Amount 2005 %

Current assets Stores, spare parts and loose tools Stoke in trade Trade debts Loans and advances Trade deposits and short prepayments Other receivable Taxation Bank balances

IBF Report 2007

%

56000000

2.29

56000000

3.17

56000000

4.53

64320000 530000000 7790725 658110725

2.64 21.72 0.32

64320000 530000000 62795922 477115890

3.64 30.02 3.56 27.03

45024000 245000000 43957145 333981145

3.64 19.82 3.56 27.03

773571428

31.70

450000000

25.49

315000000

25.49

16531736 81818183 20889982

0.68 3.35 0.86

45144890 118181819 14605576

2.56 6.69 0.83

31580423 82727273 10223903

2.56 6.69 0.83

107799852 13008063 542822800

4.42 0.53 22.24

105437966 10384432 361849578

5.97 0.59 20.50

73806576 7269102 253294705

5.97 0.59 20.50

241375362 40698304 2440626442

9.89 1.67 100

143201293 39566862 1765458338

8.11 2.24 100

100240905 27696803 1235820835

8.11 2.24 100

AMOUNT 2006 ASSETS Fixed assets Property, plant and equipment Capital work in process Long term loans Long term deposits

Amount 2004

%

1658154233 ---3783619 16083418

67.94

AMOUNT 2005

%

AMOUNT 2004

%

0.16 0.66

882288989 196776012 3400163 13539418

49.97 11.15 0.19 0.77

617602292 137743208 2380114 9477593

49.98 11.15 0.19 0.77

23036869 466592913 139753415 94619968

0.94 19.12 5.73 3.88

17887481 282896822 241246571 52368438

1.01 16.02 13.66 2.97

12521237 198027775 168870500 36657907

1.01 16.02 13.66 2.97

1634521 22324049 572880 14070557 2440626442

0.07 0.91 0.02 0.58 100

155000 24581695 1145723 49175026 1765461338

0.01 1.39 0.06 2.79 100

108500 17207187 802006 34422518 1235820835

0.01 1.39 0.06 2.79 100

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Blessed Textiles Limited

 Internal growth rate; Internal growth rate

= Return on assets (ROA) x B 1 – (ROA) x B =

0.24 (0.9677) x 100 1 – (0.24 x 0.9677) = 0.02375 x 100 = 2.375 %  Payout ratio; Payout ratio

=

Dividend paid

x 100

Net profit after tax 4807909 x100 129818803 = 3.70% =

Payout ratio  B- Retention Ratio; B-Retention ratio = 1 - Payout ratio = 1 – 0.037 B-Retention ratio = 0.963

Retention ratio indicates percentage change of net profit after tax retained by company. The retention ratio of company is 96%.  Sustainable growth rate: Sustainable growth rate

Sustainable growth rate

IBF Report 2007

= Return on equity x (b) x 100 1 – (ROE x b) = 0.138 (0.096) x 100 1 – (0.38x.096) = 0.132 x100 0.867 = 0.152x100 = 15.22%

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Blessed Textiles Limited

BLESSED TEXTILE LIMITED PROFORMA BALANCE SHEET AS AT JUNE 30,2007

ASSETS

EQUITIES AND LIABILITIES SHARE CHAPITAL AND RESERVES Authorized capital 6500,000(8006'5600,000) ordinary share holder of Rs. 10 each issued and subscribed and paid up capital general reserves unappropriated peried

FIEXD ASSETS property, plant and equipment

65,000,000 long term loans 82,832,000

long term muarbaha secured deferred liabilities

make up secured on lone short term borrowing secured current portion of long term borrowing Provision for taxation

IBF Report 2007

long term deposits

21712614

CURRENT ASSETS stores, spare parts and loose tools

31099773

10;517;478

1044321428 22317843 110454547 28201475

CURRENT LAIBILITES trade and other payable

5107885

715;500;000

NON CURRENT LAIBILITIES long term financing secured liabilities against assets subject to finance lease

2238508215

stoke in trade trade debts

188667110

loans and advances trade deposits and short prepayments

127736956

other receivable 145529809 17560885

6299900432

taxation bank balances

2206603 30137466 773388 18995251

732810780

1029516982

235856738 549427104 1276700924 3294845697

2394845697

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Blessed Textiles Limited

BLESSED TEXTILE LIMITED PROFORMA INCOME STATEMENT

Particulars

FOR THE YEAR ENDED JUNE 30,2007

net sale

Amount

3366539641

cost of good sold

(2887208119)

gross profit

479331522

other operating income

469705 479801227

distribution cost

59411289

administrative expenses

39628710

other operating expenses

10480407

finance cost

174186148 283706554

profit before tax

196094673

provision for tax

(47148050)

149291623

profit after tax

IBF Report 2007

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Blessed Textiles Limited

 Current ratio; Ratio measures firm’s ability to meet its short term obligation and commitments. BLESSED TEXILE LIT. Current assets 1.66 times in 2004, 1.01 times in 2005, and 0.8 times in 2006 of its current liabilities. If we compare company with industry the industry ration is greater the company its means the company is not in good position.  Quick ratio; Quick ratio measures firm’s ability to meet its long term obligation. BLESSED TEXITLE has quick assets 0.51 times of its current liabilities in 2004, 0.44 times in 2005, and 0.16 times in 2006. if we compare company with industry the industry ratio is greater then company which shows that company is not in a good position.  Cash ratio; It shows firm’s ability to meet its short term obligation. BLESSED TEXTILE has cash .086 times in 2004, .074 times in 2005, and .0148 times in 2006 of its current liabilities. If we compare company with industry ratio the Industry ratio is greater then company. Its means that company is worse position.  Working capital; Its shows a firm’s ability to meet is short term commitments. BLESSESD TEXTILE has working capital 18099216 in 2006. If we compare its working capital with industry the industry ratio less the company its means that company is in good position.  Debts ratio; Debts ratio measures a firm’s ability to meet its long term obligation or commitments. Its shows the relation ship with total assets and total liabilities. BLESSED TEXTILE has total liabilities 0.72 or 75% of its total assets. If we compare with industry ratio the industry ratio is less then company, its means that the company is in worse condition.

IBF Report 2007

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Blessed Textiles Limited

 Debts to equity ratio; Debt to equity ratio indicates a firm’ ability to meats its long term obligation. Its shows the relationship between total liabilities and total assets. BLESSED TEXILTE has total liabilities 2.9 times of its share holder equities. If we compare with industry ratio the company ratio is greater then industry, its means that company is in worse condition.  Time interest earned: It indicates that how many times a company can pay its interest expense with its operating profit. Blessed textile can pay 2 times its interest expense with its operating profit. If we compare company results with the industry ratio, it is greater then the company. It means that company is not in a good position.  A\C receivable turnover: It indicates that how many times a company can convert its a/C receivable in to cash. Blessed textile converts 11 times its a/C receivable in to cash. If we compare company results with the industry, the industry ratio is les then company. It means that company is in good position.  Average collection period: It indicates that how many times in terms of days a company can convert its A/C receivable in to cash. Blessed textile converts its receivable in to cash in 33 days. If we compare company results with the industry, the industry ratio is greater then the company. It means that company is in good position.  Inventory turnover: It indicates that how many times a company converts it inventory in to cash or sales. Blessed textile converts 7 times its inventory in to cash or sales. If we compare company results with the industry ratio, which is greater then the company. It means that company is in worst position.  Fixed assets turnover: It indicates that how many times sale is generated by fixed assets. Blessed textile has generated revenue 2 times. If we compare company results with the industry ratio, it is greater then the company. It means that company is not in the good position.

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Blessed Textiles Limited

 Total assets turnover: It indicates that how many times sales are generated by total assets. Blessed textile has generated sales revenue 1 time by total assets. If we compare company results with the industry ratio, then it is not a good sign for the company. Because industry ratio is greater then company.  Gross profit margin: It shows that the percentage change of gross profit margin based on its net sales. Blessed textile gross profit margin is 14% based on its net sales. If we compare it with the industry’s gross profit margin (30%), then it is greater then the company. It means that company is in worst position.  Operating profit margin: It shows that percentage of operating profit based on its net sales. Blessed textile operating profit margin is 11% based on its net sales. If we compare with the industry, the industry’s operating profit margin is greater then company. It means that company is in worst condition.  Net profit margin: It shows that percentage change of net profit based on its net sales. Blessed textile net profit margin is 4.43%. If we compare with the industry, the industry’s net profit margin is greater then the company, which shows that company, is in worst position.  Return on total assets: Return on total assets ratio indicates record of management in producing profit. Blessed textile return on total assets ratio is 18.3% of its share holder equity. If we compare it with the industry, the industry’s ratio is less then the company. It shows that company is in good position.  Return on equity ratio: Return on equity ratio indicates record of management in producing profit. Blessed textile return on equity ratio is 18.3% of its share holder equity. If we compare it with the industry, the industry’s ratio is less then the company. It shows that company is in good position.

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Blessed Textiles Limited

Ratios

2004

2005

2006

Industry

Decision

Current ratio

1.16

1.01

0.8

1.5

W

Quick ratio

0.51

0.44

0.16

1.25

W

Cash ratio

0.086

0.074

0.0148

0.9

W

Working capital

68209464

9013625

183099216 500000

B

Debt ratio

0.007

0.73

0.72

0.5

W

Debt to equity ratio Time interest earned A\Receivable turnover Average collection period Inventory turnover

2.29

2.7

2.9

0.6

W

4 time

3 time

2 time

10 time

W

6 time

7 time

11 time

10 time

B

90 days

120 days

33 days

36 days

B

5 time

6 time

7 time

15 time

W

Fixed assets turnover Total assets turnover Gross profit margin Operating profit margin Net profit margin

15 time

2 time

2 time

4 time

W

5 time

1 time

1 time

3 time

W

15%

14%

14%

30%

W

11%

10%

11%

20%

W

5.15%

5.8%

4.43%

17%

W

Return on assets

4%

5%

5.2%

15%

W

Return on equity

13.8%

18.3

21.5

14%

B

Earning per share

8.5

13.6

20

---

---

Dividend per share

0.075

0.075

0.075

---

---

Price earning ratio

1.17

0.73

0.5

---

---

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Blessed Textiles Limited

 Current ratio: Current ratio measures a firm’s ability to meet its short term obligation or commitment. Blessed textile has current assets 1.16 times in 2004, 1.01 times in 2005, and 0.8 times in 2006. If we compare 2006 with 2005, the ratio of 2006 is less then 2005. It means that company is not in good position.  Quick ratio: Quick ratio means firms ability to meet its short term obligation or commitment. Blessed textile has quick assets 0.51 times in 2005, 0.44 times in 2005, 0.16 times in 2006. If we compare 2004 with 2005 quick ratio of 2006 is less then 2005 which mean that company is in worst position.  Cash ratio: Cash ratio measures firm’s ability to meet its short term obligation or commitment. Blessed textile has its cash 0.086 times in 2004, 0.074 times in 2005, 0.0148 times in 2006, of its current liability. If we compare 2006 with 2005 the cash ratio is less then 2005. It means company is not in good position.  Working capital: It means firm’s ability to meet its short term obligation or commitment. Blessed textile has working capital 68209464 in 2004, 9013625 in 2005, and 183099216 in 2006. Working capital of 2006 has increased over 2005 which is a good sign.  Debt ratio: Debt ratio measures a firm’s ability to meet its long term obligation or commitment. Blessed textile has total liabilities 0.0074 times in 2004, 0.73 times in 2005, 0.72 times in 2006. if we compare the results of 2006 with the 2005, the ratio of 2006 is less then 2005, it means the company is in good position.  Debt to equity ratio: Debt ratio measures a firm’s ability to meet its long term obligation or commitment. Blessed textile has total liabilities 2.29 times in 2004, 2.7 times in 2005, and 2.9 times in 2006. if we compare the results of 2006 with the 2005, the ratio of 2006 is greater then 2005, it means the company is not in good position.

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Blessed Textiles Limited  Time interest earned: It indicates that how many times a company can pay interest expense with its operating profit. Blessed textile can pay its interest expense 4 times in 2004, 3 times in 2005, and 2 times in 2006. If we compare the 2006 with 2005, company can pay less then 2005, which means that company is not in good position.  A/C receivable turnover: It shows that how many times a company can convert its a/c receivable in to cash. Blessed textile can convert its a/c receivable 6 times in 2004, 7 times in 2005, and 11 times in 2006. If we compare 2006 with 2005 the ratio of 2006 is greater then 2005 it means that company is not in good position.  Average collection period: It shows that how many times a company can convert its a/c receivable in to cash in terms of days. Blessed textile can convert its a/c receivable 90 days in 2004, 120 days in 2005, and 33 days in 2006. If we compare 2006 with 2005 the company takes less time in 2006. It means that company is in good position.  Inventory turn over: It indicates that how many times a company can convert its inventory in to cash or sales. Blessed textile converts its inventory 5 times in 2004, 6 times in 2005, and 7 times in 2006 in to cash or sale. If we compare 2006 with 2005 the converts its inventory in to cash more times in 2006, which means that company, is in good condition.  Fixed assets turnover: It indicates that how many times a firm generates sales by fixed assets. Blessed textile has generated sales 15 times in 2004, 2 times in 2005, and 2 times in 2006. If we compare 2006 with 2005 both ratios are equal it means that company is in good position.  Total assets turn over: It shows that how many times a firm generates its sales by its total assets. Blessed textile has generated 5 times in 2004, 1 time in 2004, and 1 time in 2006. if we compare 2006 with 2005. The ratio of 2006 and 2005 are same, which means that company is good position.

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Blessed Textiles Limited  Gross profit margin: It show percentage in gross profit based on its net sales. Blessed textile percentage change in gross profit is 15% IN 2004, 14% IN 2005, and 14% in 2006. if we compare the ratio of 2006 with 2005, both are same which means that company is in good position.  Operating profit margin; It indicates percentage change of operating profit based on net sale. BLESSED TEXTILE’S percentage change of operating is 5.15% in 2004, 5.8% in 2005, and 4.14% in 2006. If we compare 2005 with 2006 the ratio of 2006 is less then 2005 it means that company is in worse position.  Net profit margin; It shows percentage change of net profit based on net sale. BLESSED TEXTILE’S percentage change is 5.15% in 2004, 5.8% in 2005, and 4.43% 2006. If we compare 2005 with 2006 the ratio of 2006 is greater then 2005 which is good.  Return on equity ratio; It indicates overall record of management of in producing profit. BLESSED TEXTILE’S net profit in 2004 is 13.3%, 18.3% in 2005, and18.3% in 2006. if we compare 2005 and 2006 the ratio is same its means that company is in good position.  Price earning ratio; Price earning ration indicates the relation between market price per share and earning per share. BLESSED TEXILE’S price earning ratio in 2004 is 1.17, 0.73 in 2005, and 0.5 in 2006. if we compare 2005 with 2006 the ratio of 2006 is less then 2005, its means that company is worse condition.  Dividend per share; Its indicates that how may dividend paid by company based on variable to equity share holder. BLESSED TESTILE paid dividend per share in 2004 is .075, 0.075 in 2005, and 0.075 in 2006 its ratio is same its means that company is in good position.

IBF Report 2007

25

Blessed Textiles Limited  Earning per share; Its indicates that how many earning is generated by each share. BLESSED TEXTILE’S ratio in 2004 is 8.5, 13.6 in 2005, and 20 in 2006per share. The ratio in 2006 is higher as compare to 2005. Its means that company is in good position.

IBF Report 2007

26

Blessed Textiles Limited

Ratios

2004

2005

2006

Decision

Current ratio

1.16

1.01

0.8

W

Quick ratio

0.51

0.44

0.16

W

Cash ratio

0.086

0.074

0.0148

W

Working capital

68209464

9013625

183099216

B

Debt ratio

0.007

0.73

0.72

W

Debt to equity ratio

2.29

2.7

2.9

W

Time interest earned

4 time

3 time

2 time

W

A\Receivable turnover

6 time

7 time

11 time

B

Average collection period Inventory turnover

90 days

120 days

33 days

B

5 time

6 time

7 time

W

Fixed assets turnover

15 time

2 time

2 time

W

Total assets turnover

5 time

1 time

1 time

W

Gross profit margin

15%

14%

14%

W

Operating profit margin

11%

10%

11%

W

Net profit margin

5.15%

5.8%

4.43%

W

Return on assets

4%

5%

5.2%

W

Return on equity

13.8%

18.3

21.5

B

Earning per share

8.5

13.6

20

---

Dividend per share

0.075

0.075

0.075

---

Price earning ratio

1.17

0.73

0.5

---

IBF Report 2007

27

Blessed Textiles Limited

The company is reasonable in a good position since 2004. The company has sufficient cash to its short term obligation and company has good amount of capital and also in good position then industry. The company is in long term facing difficulties to meet its obligation. The company a/c receivable turnover for recovery is growing and also in good position with respect to industry if we talk about collection period of cash is also good because industry takes more time to collect. The company does not convert its raw material not so many times the conversion ratio is not good if we compare with industry. The company production assets are not producing well, the fixed assets turnover is less then industry and fixed assets turnover as well. The company has maintained good net profit margin which shows that the company is growing and operating in profit.

IBF Report 2007

28

Blessed Textiles Limited

The over all performance of the company is good. Company is maintaining good profit. The company needs to meet its debts and debts against its equities. The company yearly performance is good but if we compare with industry then it is not a good sign. The assets of the company are not producing well because they are old. The company should reduce the expenses, because the company is bearing depreciation cost and other variable expenses. Company’s nit profit margin is very low due to increase in expenses.

IBF Report 2007

29

Blessed Textiles Limited

IBF Report 2007

30