financia managment project slides

Ratio Analysis of Financial Statements (Based on Three years data)

Non-life insurance

Adamjee insurance company LTD

Atlas insurance company LTD

Presenting by

Tanweer Sudhan

Rashid AliPresented to Sir Wasim Abbas Shaheen Quaid-I-Azam university Islamabad Pakistan

Presented to Sir Wasim Abbas Shaheen


Economic Indicators The economy of Pakistan is the 26th largest in the world

in terms of purchasing power parity (PPP), and 44th largest in terms of nominal GDP

GDP growth 2011 to 2014Real GDP growth for 2011-12 was 3.7%2012-13 was 3.6%4.14% in 2013-14

Agriculture sector growth in 2011-20143.13% in 2011-20123.5% in 2012-20132.9% in 2013-2014


Economic Indicators

Industrial sector growth 2011-2014Service Sector

4.02% in 2011-12 3.7% in 2012-13 5.2% in2013-2014

PER CAPITA INCOME$ 1368 in 2012-13$ 1,386 in 2013-14


Economic Indicators INFLATION

13.8% 2011-201210.8% 2012-20138.7% 2013-14

Money and credit14% in 2011-1210% in 2012-201310% till Nov and 9.5% in last 2 months of 2014


Non-life Insurance Sector Introduction

There are 30 registered companies operating in non-life insurance sector according to 2011 data release by SECP

The Pakistani non-life insurance segment recorded robust growth during the review period (2008-12)

Reason of growth increasing levels of risk awareness and risk avoidance knowledge

among consumers positive economic outlook and favorable government regulations for

the segment Due to security issues


Companies Introduction

Adamjee insurance companyAdamjee Insurance Company Ltd. [AIC] established in 1960It is the leader amongst 30 general insurance companies and

commands a 38% market share1000 employees at its 84 branches all over Pakistan

Product and servicesEngineering InsuranceFire & Property InsuranceRetail InsuranceMarine InsuranceFinancial Lines InsuranceMotor Insurance


COMPANIES INTRODUCTION

ATLAS INSURANCE COMPANYThe Company was founded in 1934 by Dr. Sir Muhammad Iqbal, the

founder thinker of PakistanThe Company was taken over by the Atlas Group in 1980

PRODUCT AND SERVICESFire Insurance Marine Insurance Motor Insurance Atlas Insurance Health Plan Money Insurance


LITERATURE REVIEW Five definitions for each tools used in analysis of

financial statements and five definitions for their sub items.

Main source of literature review Books Web Articles

Our literature review based on Books web


METHODOLOGY Tools used

Horizontal analysis Vertical analysis Ratio analysis

Objectives of the tools Converting financial data into some useful information for further decision

making Judge the present and future profitability Judge the operational efficiency Judge the short-term and long-term solvency Make a comparative study within inter-firm, within inter-department, to

assess a firm’s financial health Evaluate the past performance and financial position


METHODOLOGY Reason to use the tools• Horizontal analysis is used to measure the percentage

change and amount change in different items of balance sheet and income statement by comparing series financial years

• Vertical analysis is used to measure the percentage of different items of balance sheet and income statement to their respective base amount

• Ratio analysis is used to compare the relationship between different items of balance sheet to measure liquidity, activity, solvency and profitability of a firms


METHODOLOGY Significance of tools

The horizontal analysis of financial statements are good in determining performance of companies and are a great tool in deciding factors for management of all level

The importance of vertical analysis is that it makes comparisons between companies of different sizes within the same industry easier to prepare. It also allows a company to weigh its current reports against reports from its past, revealing possible trends or areas that need improvement

Ratio analysis

Measures Liquidity Position Measures operational Efficiency Measures Profitability Trend Analysis


Horizontal AnalysisAssets Liability and Owner Equity

Inc/Dec % Inc/Dec Inc/Dec % Inc/Dec Inc/Dec % Inc/Dec Inc/Dec % Inc/Deccash and other assets 58 580.00% 44 64.71% Share capital and revenuescurrent and other accounts 227,364 416.56% (119,894) -42.52% Authorized share capital 300,000 60.00% - 0.00%Depositing Maturing with in twelve Months - 0.00% - 0.00% (50,000,000 ) odinary shares of Rs 10 each - 0.00% - 0.00%

227,422 416.59% (119,850) -42.50% Issued, subscribed and paidup capital 88,588 20.00% 106,305 20.00%Loans to employee secured considered goods 53 45.30% (8) -4.71% (44,293,800) ordinary shares of Rs 10 each - 0.00% - 0.00%Investment 166,630 15.30% 294,486 23.45% Reserves 36,000 13.58% 43,000 14.28%Deferred taxation (1,297) -12.67% 11,316 126.56% Retained earnings 60,454 20.02% 93,765 25.88%Current Assets others - 0.00% - 0.00% 185,042 18.32% 243,070 20.34%Premium due but Unpaid (84,109) -26.79% 30,330 13.20% Underwriting Provisions - 0.00% - 0.00%Amount due from others insurance/reinsurance (14,504) -12.79% 11,673 11.80% Provision for outstanding claims (58,602) -22.58% 108,617 54.06%salvage recovries accured 5,165 153.26% (1,725) -20.21% Provision for unearned premium 332,149 74.93% (42,565) -5.49%Accured investment income 1,455 109.56% (2,435) -87.50% commission income unearned 21,940 47.43% (5,270) -7.73%Reinsurance recovries against outstanding claims (32,236) -21.00% 115,209 95.02% Total underwriting provision 295,487 39.45% 60,782 5.82%Deferred commission expense 44,424 194.03% (3,647) -5.42% - 0.00% - 0.00%prepayments 279,772 110.45% 615 0.12% Creditiors and Accurals - 0.00% - 0.00%Taxation-payments less provision 6,387 0.00% (6,387) -100.00% premium receive in advance 2,814 102.03% 2,480 44.51%Sundary receivables 3,778 24.76% (5,097) -26.78% Amount due to other insures / reinsurers 87,994 51.84% (21,080) -8.18%

210,132 23.96% 138,536 12.74% Accured expenses 3,461 6.71% 21,981 39.93%Fixed Assets - 0.00% - 0.00% Taxation provission less payments (11,193) -100.00% 30,488 0.00%Tangible - 0.00% - 0.00% Others creditors and Accurals 54,015 88.26% (37,345) -32.41%Freehold land - 0.00% - 0.00% 137,091 46.24% (3,476) -0.80%Building on freehold land (654) -5.00% (622) -5.00% Others liabilities - 0.00% - 0.00%Furniture and fixtures 723 29.16% (265) -8.28% Deposit Against performance Bonds 474 25.12% 7,092 300.38%office equipmenst 6,423 119.72% (1,227) -10.41% Unclaimed devidens 4,364 21.02% 6,725 26.77%Computers owned 1,788 39.52% 1,308 20.72% 4,838 21.36% 13,817 50.27%Motor vechiles - owned 11,804 62.55% (10,914) -35.58% - 0.00% - 0.00%

20,084 44.15% (11,720) -17.87% - 0.00% - 0.00%Intangible - 0.00% - 0.00% - 0.00% - 0.00%computer software (566) -39.94% 1,433 168.39% Total liabilities 437,416 40.95% 71,123 4.72%

- 0.00% - 0.00% - 0.00% - 0.00%Total Assets 622,458 29.95% 314,193 11.63% Total Equity and liabilities 622,458 29.95% 314,193 11.63%

Atlas Insurance company Horizontal analysis of Balance sheets

for the year ended 31st dec 2011, 2012 & 2013

(Rupees in thousands)2012 20132012 2013

(Rupees in thousands)


Horizontal Analysis of Profit & Loss

.

Inc/Dec % Change Inc/Dec % ChangeNet premium revenue 12,327 2.08% 152,068 25.19% Net claims 20,057 -13.08% (30,181) 22.65%Expenses (6,602) 2.90% (70,449) 30.09%Net commission 11,810 27.41% 278 0.51%Under writing results 37,592 14.82% 51,716 17.76%

Investment income 47,120 35.28% 65,707 36.36%Rental income 128 2.41% 1,070 19.64%Other income (20,881) -63.30% 13,156 108.68%Financila charges (43) 10.14% 30 -6.42%General and adminestration expense (376) 1.51% (7,731) 30.52%

25,948 17.71% 72,232 41.89%- 0.00% - 0.00%

Profit before taxation 63,540 15.88% 123,948 26.73%Provision for taxation (2,491) 2.52% (30,192) 29.77%profit after taxation 61,049 20.27% 93,756 25.88%

- - profit and loss appropriation account - 0.00% - 0.00%

- 0.00% - 0.00%Balnce at commencement year 58,699 24.13% 59,966 19.86%Profit after taxation for the year 61,049 20.27% 93,756 25.88%final dividend for 2010 @ 4 /share (2009: Rs 4/share) (29,529) 20.00% (35,435) 20.00%Transfer to general reserve (15,000) 71.43% (7,000) 19.44%Transfer to reserve for issue of bonuse share (14,765) 20.00% (17,717) 20.00%

- 0.00% - 0.00%Balance unappropriated Profit at the end of year 60,454 20.02% 93,570 25.82%

- - Basic and dialuted earning/ share _ Rupees - 0.00% - 0.00%

(Rupees in thousands)2012 2013

Atlas Insurance company Horizontal Analysis of Profit and loss account

for the year ended 31 dec 2012 & 2013


Vertical Analysis of B-S

Assets 2011 2012 2013 Liabilites and owner Equity 2011 2012 2013 (Rupees in thousand) (Rupees in thousands)cash and other assets 0.00% 0.00% 0.00% Share capital and revenuescurrent and other accounts 2.63% 10.44% 5.38% Authorized share capital 24.06% 29.62% 26.54%Depositing Maturing with in twelve Months 0.00% 0.00% 0.00% (50,000,000 ) odinary shares of Rs 10 each 0.00% 0.00% 0.00%

2.63% 10.44% 5.38% Issued, subscribed and paidup capital 21.31% 19.68% 21.16%Loans to employee secured considered goods0.01% 0.01% 0.01% (44,293,800) ordinary shares of Rs 10 each 0.00% 0.00% 0.00%Investment 52.42% 46.50% 51.43% Reserves 12.76% 11.15% 11.41%Deferred taxation 0.49% 0.33% 0.67% Retained earnings 14.53% 13.42% 15.13%Current Assets others 48.60% 44.25% 47.70%Premium due but Unpaid 15.11% 8.51% 8.63% Underwriting ProvisionsAmount due from others insurance/reinsurance5.46% 3.66% 3.67% Provision for outstanding claims 12.49% 7.44% 10.27%salvage recovries accured 0.16% 0.32% 0.23% Provision for unearned premium 21.33% 28.71% 24.31%Accured investment income 0.06% 0.10% 0.01% commission income unearned 2.23% 2.53% 2.09%Reinsurance recovries against outstanding claims7.39% 4.49% 7.84% Total underwriting provision 36.04% 38.68% 36.66%Deferred commission expense 1.10% 2.49% 2.11%prepayments 12.19% 19.74% 17.70% Creditiors and AccuralsTaxation-payments less provision 0.00% 0.24% 0.00% premium receive in advance 0.13% 0.21% 0.27%Sundary receivables 0.73% 0.70% 0.46% Amount due to other insures / reinsurers 8.17% 9.54% 7.85%

42.20% 40.26% 40.66% Accured expenses 2.48% 2.04% 2.55%Fixed Assets Taxation provission less payments 0.54% 0.00% 1.01%Tangible Others creditors and Accurals 2.94% 4.27% 2.58%Freehold land 0.06% 0.04% 0.04% 14.27% 16.06% 14.27%Building on freehold land 0.63% 0.46% 0.39% Others liabilitiesFurniture and fixtures 0.12% 0.12% 0.10% Deposit Against performance Bonds 0.09% 0.09% 0.31%office equipmenst 0.26% 0.44% 0.35% Unclaimed devidens 1.00% 0.93% 1.06%Computers owned 0.22% 0.23% 0.25% 1.09% 1.02% 1.37%Motor vechiles - owned 0.91% 1.14% 0.66%

2.19% 2.43% 1.79%Intangible computer software 0.07% 0.03% 0.08% Total liabilities 51.40% 55.75% 52.30%

Total Assets 100.00% 100.00% 100.00% Total Equity and liabilities 100.00% 100.00% 100.00%

Atlas Insurance company Vertical Analysis of Balance sheets

As on 31st of dec 2011, 2012 & 2014


Vertical Analysis of Profit & loss

. 2011 2012 2013 (Rupees in thousands)

Net premium revenue 100.00% 100.00% 100.00% Net claims -25.93% -22.07% -21.63%Expenses -38.47% -38.78% -40.30%Net commission 7.29% 9.09% 7.30%Under writing results 42.89% 48.24% 45.38%

Investment income 22.59% 29.93% 32.61%Rental income 0.90% 0.90% 0.86%Other income 5.58% 2.01% 3.34%Financila charges -0.07% -0.08% -0.06%General and adminestration expense -4.22% -4.20% -4.38%

24.78% 28.57% 32.38%

Profit before taxation 67.66% 76.81% 77.75%Provision for taxation -16.73% -16.80% -17.41%profit after taxation 50.93% 60.01% 60.34%

profit and loss appropriation account

Balnce at commencement year 41.13% 50.02% 47.89%Profit after taxation for the year 50.93% 60.01% 60.34%final dividend for 2010 @ 4 /share (2009: Rs 4/share) -24.97% -29.35% -28.13%Transfer to general reserve -3.55% -5.96% -5.69%Transfer to reserve for issue of bonuse share -12.49% -14.68% -14.07%

Balance unappropriated Profit at the end of year 51.06% 60.03% 60.33%

Basic and dialuted earning/ share _ Rupees 0.00% 0.00% 0.00%

Atlas Insurance company Vertical Analysis of Profit and Loss Account

for the year ended 2011, 2012 & 2013


Adamjee Insurance companyHorizontal analysis of balance sheet

Liabilities and owners Equity ASSETSInc/Dec % Inc/Dec Inc/Dec % Inc/Dec Cash and bank deposits Inc/Dec % Inc/Dec Inc/Dec % Inc/Dec

Share capital and reserves Cash and other equivalents 3,331 278% (20,397) -94.44%Authorized share capital 2,250,000 150.00% 0 0.00% Current and other accounts (6,406) -0.38% 178,296 11.68%

Deposits meturing with in twelve months 129,817 12.65% 68,679 7.17%

Paid-up share capital 2,262,955 182.93% - - 126,742 4.64% 226,578 9.04% Retained earnings (746,073) -8.40% 252,935 2.93% Loans - - Reserves (25,798) -2.27% 111,138 10.86% To Employees 3,360 26.27% (4,384) -25.53%

(771,871) -7.70% 364,073 3.77% Investments 4,238,999 36.60% 1,624,931 16.32%Equity Attributable to equity holders of parent 1,491,084 13.25% 364,073 3.34% - - Non controlling intrest (6,188) -21.42% (48,859) -62.84% Deffered Taxation (139,719) -56.55% 45,461 22.55%Total Equity 1,484,896 13.16% 315,214 2.87% Current Assets - others - -

Premiums due but un paid (543,263) -16.89% (381,698) -10.61%

Balance of stature fundsAmount due from other insurers / reinsurers 488,355 80.51% (73,072) -10.75%

{including policy holdres liabilities of Rs 4,824.672 mill 2,842,653 140.89% 1,508,103 295.95% salvage Recovries accured 10,032 5.91% 3,953 2.39%

Premium and claim reserves retained by cedents - 0.00% - 0.00%

undrerwriting provisions Accured investment income 3,505 13.17% (13,917) -34.33% Provisions for outstanding claims 994,191 15.50% 836,290 15.00%

Reinsurence recovries against outstanding claims 1,244,199 28.73% 530,863 13.97%

Provisions for unearned 83,538 2.11% (367,053) -8.48% Taxation - payments less (5,702) -6.12% 80,106 615.06% Commission income (131,095) -41.85% (58,408) -15.71% Deffered commisiion (31,554) -7.47% (50,196) -10.63%

946,634 8.86% 410,829 4.00% Prepayments 37,968 2.17% (296,536) -14.52%Deferred liabilities Sundary Receivables (2011: (3,471) -1.66% 1,380 0.67% Staff retairments benefit 18,465 49.00% 11,229 42.44% 1,200,069 11.07% (199,117) -1.80%

Creditors and accurals Fixed assets - tengible and intengible owned - -

Premium receive in 100,792 78.66% 39,983 45.35% land and buildings (18,843) -4.06% 192,319 70.78% Amount due to other 157,783 31.26% (698,847) -58.06% furniture and fixtures 41,824 36.58% 37,672 49.14% Accured expenses (4,976) -4.15% (41,178) -25.57% Motor vechiles 48,061 21.46% 6,103 2.80% Other creditors and (7,300) -0.42% 219,843 14.50% Mechinary and Equipments 16,866 16.94% (114,357) -53.46%

246,299 9.90% (480,199) -16.17% Computers and related 4,159 8.26% (7,003) -12.21%Borrowings Intengible asset - computers 22,589 36.92% 2,290 3.89% Liabiliities against Assets subject to finance lease (18,304) -73.25% (33,580) -57.34%

Capital work in progress Tengible (2,545) -2.77% (41,523) -31.13%

Other liabilities 112,111 10.14% 75,501 7.33% Unclaimed dividends 2,117 5.95% 2,063 6.16% leased - - TOTAL LIBILITIES 1,195,211 9.00% (89,658) -0.67% Motor vechiles (18,802) -35.86% (35,311) -40.25% TOTAL EQUITY AND 5,522,760 20.78% 1,733,659 6.98% TOTAL ASSETS 5,522,760 20.78% 1,733,659 6.98%

2013 2012 2013 2012


Horizontal Analysis of Profit & LossREVENUE ACCOUNT

Inc/Dec % Inc/Dec Inc/Dec % Inc/DecNet premium revenue 1,956,826 24.89% 87,124 1.12% Net claims -Restated 202,676 -4.72% 481,176 -10.07%Expenses (23,367) 1.31% (388,554) 27.74%Net commission (308,018) 31.59% (110,925) 12.83%Net investment income - statutary refunds 162,357 105.08% 131,703 577.59%

Add : Policy Holders liability at begning of the years 1,475,113 307.60% 380,083 382.07%

Less : Policy holders liability at the end of the years (2,869,996) 146.83% (1,475,114) 307.60%Capital constribution from share holders' fund (107,094) -75.94% (43,428) -23.54%surplus of policy holders fund 60,334 -182.89% (2,968) 9.89%Under writing Rsults 548,831 -133.12% (940,903) -177.99%

- - Investment income - others 1,269,031 113.70% 352,583 46.18%Rental income 4,402 807.71% (112) -17.05%other income (15,647) -9.46% 6,798 4.29%

1,806,617 207.70% (581,634) -40.07%- -

General and Adminestration Expense (28,332) 6.59% 1,147,636 -72.74%Exchange gain / (loss) 7,857 281.41% 2,402 615.90%Finance charge on lease libilities 3,800 -68.09% 9,598 -63.23%Share of profit from Associated companies (47,627) -100.00% (170,983) -78.21%Profit before tax 1,742,315 359.51% 407,019 524.43%Provision for taxation (205,622) 477.27% (213,921) -125.22%Profit after tax 1,536,693 348.02% 193,098 77.72%Profit attributable to : - - Equity holders of parent 1,536,328 350.37% 198,354 82.60%Non controlling intrest 365 11.94% (5,256) -63.23%

1,536,693 348.02% 193,098 77.72%Profit and loss appropriation Account - parent company - -

- - - -

Balance at the commencement of the year 198,886 2.30% (69,124) -0.79%profit after tax for the year attributable to equity holders of the parent 1,536,328 350.37% 198,354 82.60%Final dividends for the year ended 31st dec 2010 @ 15% Rs 1.5/share (123,705) 185,557 -100.00%Issue of the bonus share for the year ended 31st dec 2010 nil (2009 : 10%) - - Interium dividend @10% (Rs 1/share) (123,705) 66.67% (61,852) 50.00%issue of bonus share @182.93% (2012: nill) (2,262,955) - other comprehensive income : remeasurment of defined benefit obligation-Restated 29,078 -

Balance unappropriated Profit at the end of the year (746,073) -8.40% 252,935 2.93%

- - Earning per share 2 59.32% 2 82.47%

2013 2012


Vertical Analysis of Balance Sheet Liabilities and owners Equity 2013 2012 2011 ASSETS 2013 2012 2011

Cash and bank deposits Share capital and reserves Cash and other equivalents 0.01% 0.00% 0.09%Authorized share capital 11.68% 5.64% 6.04% Current and other accounts 5.29% 6.42% 6.15%

Deposits meturing with in twelve months 3.60% 3.86% 3.85%

Paid-up share capital 10.90% 4.65% 4.98% 8.91% 10.28% 10.09% Retained earnings 25.36% 33.43% 34.75% Loans Reserves 3.45% 4.27% 4.12% To Employees 0.05% 0.05% 0.07%

28.81% 37.70% 38.87% Investments 49.29% 43.58% 40.08%Equity Attributable to equity holders of parent 39.71% 42.35% 43.84% 0.00% 0.00% 0.00%Non controlling intrest 0.07% 0.11% 0.31% Deffered Taxation 0.33% 0.93% 0.81%Total Equity 39.78% 42.46% 44.16% Current Assets - others

Premiums due but un paid 8.33% 12.10% 14.49%

Balance of stature fundsAmount due from other insurers / reinsurers 3.41% 2.28% 2.74%

{including policy holdres liabilities of Rs 4,824.672 mill (2012:RS 1,954.675 mill)} 15.14% 7.59% 2.05% salvage Recovries accured 0.56% 0.64% 0.67%

Premium and claim reserves retained by cedents 0.07% 0.09% 0.09%

undrerwriting provisions Accured investment income 0.09% 0.10% 0.16% Provisions for outstanding claims (including IBNR) 23.07% 24.13% 22.44%

Reinsurence recovries against outstanding claims 17.37% 16.29% 15.29%

Provisions for unearned premium 12.60% 14.90% 17.42% Taxation - payments less provision 0.27% 0.35% 0.05% Commission income unearned 0.57% 1.18% 1.50% Deffered commisiion expense 1.22% 1.59% 1.90%

36.24% 40.21% 41.36% Prepayments 5.56% 6.57% 8.22%Deferred liabilities Sundary Receivables (2011: restated) 0.64% 0.79% 0.83% Staff retairments benefit 0.17% 0.14% 0.11% 37.52% 40.80% 44.45%

Creditors and accurals Fixed assets - tengible and intengible owned

Premium receive in advance 0.71% 0.48% 0.35% land and buildings 1.39% 1.75% 1.09% Amount due to other insurers/ reinsurers 2.06% 1.90% 4.84% furniture and fixtures 0.49% 0.43% 0.31% Accured expenses 0.36% 0.45% 0.65% Motor vechiles 0.85% 0.84% 0.88% Other creditors and Accurals- Restated 5.39% 6.53% 6.10% Mechinary and Equipments 0.36% 0.37% 0.86%

8.52% 9.36% 11.95% Computers and related accessories 0.17% 0.19% 0.23%Borrowings Intengible asset - computers softwares 0.26% 0.23% 0.24% Liabiliities against Assets subject to finance lease 0.02% 0.09% 0.24% Capital work in progress Tengible 0.28% 0.35% 0.54%Other liabilities 3.79% 4.16% 4.15% Unclaimed dividends 0.12% 0.13% 0.13% leased TOTAL LIBILITIES 45.08% 49.95% 53.79% Motor vechiles 0.10% 0.20% 0.35% TOTAL EQUITY AND LIBILITIES 100.00% 100.00% 100.00% TOTAL ASSETS 100.00% 100.00% 100.00%

(Rupees in thousand) (Rupees in Thousand)


Vertical Analysis of Income Statement REVENUE ACCOUNT 2013 2012 2011Net premium revenue 100.00% 100.00% 100.00% Net claims -Restated -41.70% -54.66% -61.46%Expenses -18.46% -22.76% -18.01%Net commission -13.07% -12.40% -11.12%Net investment income - statutary refunds 3.23% 1.97% 0.29%Add : Policy Holders liability at begning of the years 19.91% 6.10% 1.28%Less : Policy holders liability at the end of the years -49.13% -24.86% -6.17%Capital constribution from share holders' fund 0.35% 1.79% 2.37%surplus of policy holders fund 0.28% -0.42% -0.39%Under writing Rsults 1.39% -5.24% 6.80%

Investment income - others 24.29% 14.20% 9.82%Rental income 0.05% 0.01% 0.01%other income 1.53% 2.10% 2.04%

27.26% 11.06% 18.67%

General and Adminestration Expense -4.67% -5.47% -20.29%Exchange gain / (loss) 0.11% 0.04% 0.01%Finance charge on lease libilities -0.02% -0.07% -0.20%Share of profit from Associated companies 0.00% 0.61% 2.81%Profit before tax 22.68% 6.16% 1.00%Provision for taxation -2.53% -0.55% 2.20%Profit after tax 20.15% 5.62% 3.20%Profit attributable to : 0.00% 0.00% 0.00%Equity holders of parent 20.11% 5.58% 3.09%Non controlling intrest 0.03% 0.04% 0.11%

20.15% 5.62% 3.20%Profit and loss appropriation Account - parent company

Balance at the commencement of the year 89.94% 109.79% 111.91%

profit after tax for the year attributable to equity holders of the parent 20.11% 5.58% 3.09%Final dividends for the year ended 31st dec 2010 @ 15% Rs 1.5/share -1.26% 0.00% -2.39%Issue of the bonus share for the year ended 31st dec 2010 nil (2009 : 10%) 0.00% 0.00% 0.00%Interium dividend @10% (Rs 1/share) -3.15% -2.36% -1.59%issue of bonus share @182.93% (2012: nill) -23.05% 0.00% 0.00%other comprehensive income : remeasurment of defined benefit obligation-Restated 0.30% 0.00% 0.00%Balance unappropriated Profit at the end of the year 82.89% 113.01% 111.02%

Rupees Rupees Rupee

Earning per share 0.00% 0.00% 0.00%

Profit and loss for the years ended 31st dec 2011 2012 2013


Ratio Analysis

• Liquidity Ratio

• Activity Ratio

• Leverage Ratio

• Profitability Ratio

• Market Ratio

Liquidity Ratio

companies 2011 2012 2013 Average Atlas Inc company 2.56 2.17 2.49 2.40 Adam jee Inc company 3.72 4.36 4.40 4.16 Average 3.14 3.26 3.44 3.28

Current Ratio

2011

2012

2013

Aver

age

0.00

1.00

2.00

3.00

4.00

5.00

Atlas Inc company Adam jee Inc company Average


Current Ratio

2011

2012

2013

Aver

age

0.00

1.00

2.00

3.00

4.00

5.00



Activity Ratio

companies 2011 2012 2013 Average Atlas Inc company 38.76 35.21 45.84 40 Adam jee Inc company 37.49 37.78 37.49 38 Average 38 36 42 39

Account receivable Turn over


Average Collection Period


Average payment period

20112012

2013

Averag

e 0.00

20.00

40.00

60.00

80.00


20112012

2013

Averag

e 0.002.004.006.008.00

10.0012.00


20112012

2013

Averag

e 0.00

10.00

20.00

30.00

40.00

50.00



Cont….


Operating cycle

2011

2012

2013

Aver

age

0.00

4.00

8.00

12.00


companies 2011 2012 2013 Average Atlas Inc company -28.36 -42.97 -38.67 -37 Adam jee Inc company -60.61 -64.94 -39.84 -55 Average -44 -54 -39 -46

Cash Conversion Cycle20

1120

1220

13

Aver

age

-70.00-60.00-50.00-40.00-30.00-20.00-10.00

0.00



Total Assets turn over

2011

2012

2013

Aver

age

0.00

0.20

0.40

0.60



Leverage Ratio

2011 2012 2013 AverageAtlas insurance co 2.171 0.000 0.000 0.724

Adam jee insurance co 1.384 1.354 0.667 1.135Average 1.777 0.677 0.334 0.929

Debt to equity ratio



Debt ratio

20112012

2013

Averag

e0.00

0.20

0.40

0.60

0.80

1.00

1.20

Atlas in-surance coAdam jee insurance coAverage

20112012

2013

Averag

e0.000

0.500

1.000

1.500

2.000

2.500

Atlas insurance coAdam jee insurance coAverage


Profitability Ratios

2011 2012 2013 AverageAtlas insurance co 45.38% 0.00% 0.00% 15.13%

Adam jee insurance co 6.80% -5.24% 1.39% 0.98%Average 26.09% -2.62% 0.70% 8.05%

Gross Profit Margin


Adam jee insurance co 3.20% 5.62% 20.15% 9.65%Average 27.13% 32.82% 40.24% 33.40%

Net Profit Margin

2011 2012 2013 Average-10.00%0.00%

10.00%20.00%30.00%40.00%50.00%

Gross Profit Margin

Atlas insurance co Adam jee insurance coAverage

2011 2012 2013 Average0.00%

10.00%20.00%30.00%40.00%50.00%60.00%70.00% Net Profit Margin



Cont..



Retun on Assets



Return on Equity

2011 2012 2013 Average0.00%5.00%

10.00%15.00%20.00%25.00%30.00%35.00%

Return on Assets


2011 2012 2013 Average0.00%

10.00%20.00%30.00%40.00%50.00%

Return on Equity



Market Value Ratio



Dividend per share


Adam jee insurance co 2 4 6 3.74Average 4.41 5.19 6.40 5.34

Earning per share



Dividend payement ratio

2011 2012 2013 Average0.00

1.00

2.00

3.00

4.00

5.00


2011 2012 2013 Average0.00

2.00

4.00

6.00

8.00

Atlas insurance co

Adam jee insurance co

Average

2011 2012 2013 Average0.000.200.400.600.801.001.201.40

Atlas insurance co

Adam jee in-surance co

Average


Cont….



Price or Earning ratio

2011 2012 2013 Average0.005.00

10.0015.0020.0025.0030.0035.0040.0045.0050.00



RECOMMENDATION

• Both the companies need to improve their liquidity positions

• Both companies should use more debt to reduce WACC.

• Cash conversion cycle of both the companies should near to positive so that more people will trust

• Adamjee insurance company should increase it gross profit margin by controlling the operating cost.

• Adamjee insurance company should increase its net profit margin by reducing different administration cost.

• Both companies need to improve their average collection period.

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