salalah port report (a good report)

8/8/2019 Salalah Port Report (a Good Report)

1/23

SSTRATEGICTRATEGIC FFINANCEINANCE

CCRITICALRITICAL AANALYSISNALYSISOFOFTHETHE FFINANCIALINANCIAL

PPERFORMANCEERFORMANCEOFOF SSALALAHALALAH PPORTORT CCOMPANYOMPANY

EXECUTIVE SUMMARY

MBA-SF-Group APage 1 of23


2/23

The main purpose of this report is to come out with a critical analysis of the financialperformance of a Salalah Port Services Company S.A.O.G during financial years of 2005 to2006 compared with similar business company, such as Port Services CorporationS.A.O.G.( Port of Sultan Qaboos). Also, the importance of this financial analysis to arrive atspecific recommendations and make a decision based on qualitative and quantitative

techniques.

This report is divided in to three parts; the first part of the report is the general businessoverview of the Salalah Port Service Company, the second part is the ratios analysis of theSalalah Port Service Company and the final part is the comparison of Salalah Port ServiceCompany with its competitor the Sultan Qaboos Port Company.

There is a third Port in Oman (Port of Sohar) which is a joint venture between thegovernment of Oman and Rotterdam Port (50/50). It started its first operation December2006. The financial information is not available because the company is not registered as a

public shareholders company in Muscat Securities Market. Therefore, the comparison willbe restricted between Port of Salalah and Port of Sultan Qaboos.

The financial analysis of the both mentioned companies were made based on thepublishedBalance Sheet, Cash Flow Statement and Income Statement for 2005 and 2006.Furthermore, the Chairmans report and Directors report of both the companies were readand discussed for a better analysis. The financial reports 2007 of both companies were not

published at the time of writing this report.

Ratios are highly important profit tools in financial analysis that help financial analystsimplement plans that improve profitability, liquidity, financial structure, reordering, leverage,and interest coverage. Although ratios report mostly on past performances, they can be

predictive too, and provide lead indications of potential problem areas as we are trying todo here between these two years (2005 -2006). The followings ratios have been used inthis report: Profitability, Efficiency, Liquidity, Financial Gearing and Investment.

Salalah Port Overview

Expansion of non-current assets; this has increased by 21% (from R.O 42,150 m to R.O

50,903 m). Sales revenue, expanded slightly more by 4% from R.O 26,737 m to R.O 27,918

which is less expansion than non-current assets.

Expansion in the element of working capital: inventories slight increased by about 6 %,

trade receivable has not changed. There is no major expansion in the working capital dueto the period of high inflection.

Increase in cash balance: the cash balance increased from R.O 1691 m to R.O 5486 m by

224 % more between 2005 and 2006. This leaves the company in comfortable situation

from the Bank.

Apparent dept capacity: comparing the non-current assets with the long term borrowings

implies that the business has very high capacity on security on further borrowing. This isbecause of potential lenders usually look at the value of assets that can be offered as

security when assessing from requests.

High operation profit: though sales revenue expanded by 4% only between 2005 and 2006,

both direct operating cost and operating expenses rose by 10% and 13% with increase in

both profit and operating profit by 11%.



3/23

TABLE OF CONTENTS

EXECUTIVE SUMMARY...............................................................................11.INTRODUCTION.........................................................................................4

1.1 Port of Salalah..........................................................................................41.2 Port of Sultan Qaboos (PSQ)...................................................................42. RATIO ANALYSIS FOR SALALAH PORT COMPANY FOR THE YEARS2005 & 2006....................................................................................................52.1. PROFITABILITY......................................................................................52.1.1. GROSS PROFIT MARGIN...................................................................52.1.2. OPERATING PROFIT MARGIN...........................................................52.1.3. RETURN ON ORDINARY SHAREHOLDERS FUNDS (ROSF) .........62.1.4. RETURN ON CAPITAL EMPLOYED (ROCE).....................................62.1.5. CONCLUSION......................................................................................62.2. EFFICIENCY ...........................................................................................72.2.1. AVERAGE SETTLEMENT PERIOD FOR TRADE RECEIVABLES....72.2.2. SALES REVENUE TO CAPITAL EMPLOYED RATIO........................82.2.3. CONCLUSION......................................................................................82.3. LIQUIDITY...............................................................................................82.3.1 CURRENT RATIO ................................................................................82.3.2 ACID TEST RATIO ...............................................................................92.3.3. OPERATING CASH FLOWS TO MATURING OBLIGATIONS ..........92.3.4. CONCLUSION......................................................................................92.4. FINANCIAL GEARING..........................................................................102.4.1 GEARING RATIO ...............................................................................102.5. INVESTMENT .......................................................................................102.5.1 DIVIDEND PAYOUT RATIO ...............................................................102.5.2 DIVIDEND YIELD RATIO ...................................................................112.5.3. EARNINGS PER SHARE.................................................................112.5.4. PRICE/EARNINGS (P/E) RATIO........................................................113.RATIO ANALYSIS - COMPARISON WITH SULTAN QABOOS PORTCOMPANY (COMPETITOR) .......................................................................123.1. PROFITABILITY....................................................................................123.2. EFFICIENCY.........................................................................................133.3. LIQUIDITY.............................................................................................143.4. FINANCIAL GEARING..........................................................................143.5. INVESTMENT........................................................................................144.CONCLUSION ..........................................................................................155. REFERENCES.........................................................................................166.APPENDIX A.............................................................................................177.APPENDIX B.............................................................................................23



4/23

1. INTRODUCTION

1.1 Port of Salalah

Port Of Salalah, earlier known as (Mina Raysut),handled its first container vessel operation in November1998; this was a new era for the region and the country.The advantages this port has are ( multi-use, break-bulk and containers, superior location not far from thetrade lines, stable and high productive), which are whymajor shipping lines such as CMA-AGM, APL,MOL,Safmarine and Maersk Line use this port. The project isa joint venture between the Government, Privet funds,local share holders, Sea Land, and Maersk Line (later became Maersk Sea land).

This port is designed and equipped with the latest technology in terminal operation

equipment such as, Pan Panamax Cranes designed for the second generation vessels,and the biggest cranes in the world were first ordered by Port of Salalah. Salalah is locatedin the middle of the growing markets at the Indian Ocean Rim with about 2 billionconsumers. Its strategic location directly at the main shipping lane between Europe and theFar East (East-West trading roots) this will provide easy access to the main markets. Nextto the port the Government of Oman declared a Free Zone company to be formed (SalalahFree Zone Company), and currently the Free Zone Company is functioning and there areseveral factories already operational.

1.2 Port of Sultan Qaboos (PSQ)

Port of Sultan Qaboos was the first international Port in Oman, It is operated and managedby Port Services Corporation, the port was mainly focusing on conventional cargo from1976-1981, then the port has developed its current berths to sustain container vessels by1983-1984, first operational system to handle containers was 1985, early 1990 there was

further enhanced for another two berths to handle multi purpose vessels.

Port of Sultan Qaboos is an ideal transshipment hub for the upper Gulf and Red Sea portstrade flows. Oman's premier maritime gateway enjoys a prime location in the politicallystable Sultanate of Oman. This port is situated in a natural harbor 250 Kilometers south ofthe Strait of Hormuz on the Indian Ocean coast of the Arabian Peninsula.



5/23


6/23

2.1.3. RETURN ON ORDINARY SHAREHOLDERS FUNDS (ROSF)

The ROSF ratio compares the net profit available to the owners with the shareholders stakein the company for the same year. Though, the company has slightly succeeded inincreasing its net profits from 4,095 in 2005 to 4,154 during 2006. The company has adecline in ROSF by 1.01 % due to an increase in the legal reserve and retained Earnings,whereas the share capital remained the same amount. Usually, 10% of net profit is held asa cumulative reserve. Also, the market share value of the company has increased whichresulted in this increase of the retained earring during 2006.

2.1.4. RETURN ON CAPITAL EMPLOYED (ROCE)

The ROCE ratio compares the net profit (before interest and taxation) generated bycompany to the long term capital invested in the company during the same period. There isa decline in the ROCE of the company by 2.27 % in 2006. The company has paid2,262,000 OMR as deferred tax in year 2006. This is was due to an earlier agreement with

the government of an exemption of tax paid for utilizing the general cargo terminal and2005 was the first year the payment is due that cause the reduction in ROCE during 2006.In addition, the company has paid a higher amount for the non-current loans which arepurchase of new cranes, artgs(rubber, tired, gantry) & prime movers for the additionalberths 5& 6 about 23,339,000 OMR by comparing with 15,344,000 OMR in 2005. This ispart of the master plan for the expansion of the Salalah Port for the next 20 years as a longterm investment.

2.1.5. CONCLUSION

It can be observed from the above discussion that the company performance has declinedalthough not significantly. However, this does not reflect the actual picture of the indicated

increase in volume which requires placement of additional equipment which impacted thecurrent year as in the Figure 1. Usually, the pay off of such investment comes within thecoming years. The master plan of this terminal is going to be one of the biggesttranshipment hubs in the Middle East with not less than 50 gantry cranes at the momentthey have only 6 berths and 80 cranes. (www. portofsalalah.com)



7/23

PROFITABILITY

15.1312.21

20.35

4

14.12

9.94

19.78

45.0

20

30

40

50

60

%

Figure-1

2.2.EFFICIENCY

Since the Efficiency ratio is one of the essential scale for any company performance, weare going to elaborate more by using available data for Salalah Port Company about onlytwo following ratios (as illustrated in table 2) because the company is considered a servicecompany and we are limited in using other efficiency ratios:

Average settlement period for trade receivables.

Sales revenue to capital employed ratio.

2005 (%) 2006 (%)

Average settlement period fortrade receivables.

51.780 49.577

Sales revenue to capitalemployed ratio.

0.717 0.603

Table 2

2.2.1. AVERAGE SETTLEMENT PERIOD FOR TRADE

RECEIVABLES

The company has improved its figure in average period for trade receivables for the yearsof 2005 and 2006 which; it has been reduced from 51.78 to 49.58 days. The collection ofdebtors has improved which is a good sign of debt management.



8/23

49.78

0.6 51.78

0.72

48

49

50

51

52

53

Efficiency ratios

2.2.2. SALES REVENUE TO CAPITAL EMPLOYED RATIO

The sales revenue to capital employed ratio examines how effectively the total assets ofthe company (share capital plus reserve plus non current liabilities) are being used togenerate sales revenue. The ratio has decreased for the year 2006. This is mainly due toexpansion plans as the company is still in continue growth stage. Also, it is normal to seethat heavy investment is injected in this stage.

2.2.3. CONCLUSION

It can be seen form the above discussion that thecompany has performed well for the years 2005% 2006 regarding the services achieved andgaining good revenue rather than the cash beingtied up with the customers. Figure-2 shows therelated figures for 2005 and 2006 for average

period for trade receivables and sales revenue tocapital ratio. The company is still in growingstage and not yet reached the maturity level.Based on that, a huge investment will be involvedsimultaneously the management is working onefficiency of the work force to maximize itsproductivity.

Figure-2

2.3.LIQUIDITY

The Liquidity is one of the essential measurement tools for any firms in order to maintainthe required short term financial obligations. The following tools are the main indicators for

company liquidity taken in this paper as shown in table 3: Current Ratio

Acid test ratio

Operating cash flows to maturing obligations

2005 2006

Current Ratio 1.63 1.92

Acid test ratio 1.46 1.73

Operating cash flows to maturing obligations 1.02 0.99

Table 3

2.3.1 CURRENT RATIO

The current ratio compares current asset (which represents cash and other assets held thatare easily converted to cash) with the current liabilities of the company. The current ratiohas increased from 1.6 times to 1.9 times in 2006 which indicates a good liquiditymanagement and that was mainly due to increase in current assets and decrease ofcurrent liabilities. Since the company is a service provider and there is a minimuminventories amount is required, this ratio is expected to be low. However, the company has



9/23

improved its portion of cash and cash equivalent which made it liquid enough to meet itsshort term obligations. Also, under the terms of the debt finance agreement the company isrequired to maintain a debt service deposit equal to its next six month debt repayment andthis was reflected in the increase amount of company term deposit during 2006. In addition,the company has succeeded in decreasing their trade and other payables.

2.3.2ACID TEST RATIO

The acid test ratio is similar to current ratio but it is excluding the stock from the currentassets. The ratio has increased slightly from 1.46 times in 2005 to 1.73 times in 2006. Thisindicates that the company is in a comfortable position to cover its short term obligations(current liabilities). Also, this was good as normally the minimum level of this ratio is oftenstated as 1.0 times (or 1:1; that is, current asset (excluding inventories) equals currentliabilities) (Mclaney. E, 2008, p.241). As known, this is a unique service industry where theinventory does not easily convert to cash.

2.3.3.OPERATING CASH FLOWS TO MATURING OBLIGATIONS

The operating cash flows to maturing obligation ratio compares cash generated fromoperating activities (which is taken from cash flow statement ) to the company currentliabilities. The ratio has declined to 0.99 from 1.02; this indicates that the current operatingcash flow is not sufficient to cover the current liabilities for the company.

2.3.4. CONCLUSION

It can be observed from the above ratios indications; the company does have a suitableliquidity margin to meet its short term obligations. This was mainly illustrated in improvingthe company current asset and reducing its current liabilities from 2005 to 2006 see

Figure-3. However, the decline in the operating cash flow need to be a concern for thecompany and further strategic improvement must be applied such as improving theefficiency of the operation staff by maximizing their output which will be positively reflectingin the cash flow generated from operating activities.

1.63

1.92

1.46

1.73

1.02 0.

0.4

0.6

0.8

1

1.2

1.4

1.6

1.8

2

%

LIQUIDITY

Figure-3



10/23

2.4. FINANCIAL GEARING

Any organization needs for the financial gearing because of two possible reasons: first,there are insufficient funds from the owners or the company willing to increase the returns

for the company. By using available information of the Salalah Port Company, we will coverthe gearing ratio calculation only.

2.4.1 GEARING RATIO

Gearing ratio measures the long term liabilities of the company to its long term capitalstructure. The company has increased its funds beside its share capital and legal reservefrom 49.94 % in 2005 to 56.43% in 2006 by approximately 5 % by taking loans almost23,339,000 OMR. In this particular sector of companys plan of expansions and futuredevelopment based on forecast from the customers and indication of expected volumeincrease or decrease based on the trade seasons in the world (Christmas, Chinese NewYear, New development Projects, Religious Dates, and Wars (God Forbids) terminals take

time to attract new volumes and takes time to divert a service from one port to another,sometimes it takes up to 6 months to change company service, and book windows interminals.

2.5. INVESTMENT

From an investment point of view, the following are the most essential and common ratiosto help and guide the investors in his/ her decision (table 3) and Figure 4:

2005 2006

Dividend payout ratio 43.69 43.07

Dividend cover ratio 2.27 2.31

Dividend yield 1.96 1.90Earnings per share 22.8 23.1

Cash gen from ops per share 0.51 0.48

P/E ratio 22.37 22.94

Table3

2.5.1 DIVIDEND PAYOUT RATIO

The dividend payout ratio measures the portion of the company earrings paid in the form ofdividends to the shareholders. During year 2005 the board of directors of Salalah Port hasapproved a dividend distribution of 10% on paid up equity share capital which is equivalentto 0.100 Baiza per share where in 2006 it was announced a distribution of dividends of 12%paid up equity share capital which is equivalent to 0.120 Baiza per share. Despite theincrease in the dividends paid during 2006 as result of an increase in the net profit, thedividend payout ratio has slightly declined. However, the earning available for dividendscovers the actual dividends by 2.3 times during 2006.



11/23

2.5.2 DIVIDEND YIELD RATIO

Dividend yield ratio calculates the dividend per share over the company current market

value per share. The above ratio has considerably decreased to 1.89 from 1.96 which willnot encourage the new investors. This is due to the higher value of the share in 2006 was5.299 OMR compare with 5.1 OMR in 2005.

2.5.3. EARNINGS PER SHARE

Earnings per share measure the share performance but it is not related to the profit of theshare as well. There is a minor increase for EPS for the company from 22.77 OMR in 2005to 23.10 OMR in 2006. It means there is a potential investment on the business shares.

2.5.4. PRICE/EARNINGS (P/E) RATIO

The price/ earring ratio relates the market value per share to the earring per share. Thecompany has a slight increase in P\E ratio from 22.37 OMR in 2005 to 22.94 OMR in 2006.This is the investor indicator regarding studying the overall market performance in the samesector. Investor would definitely compare this with peer group and other business sectorsbefore investing.

0

5

10

15

20

25

30

35

40

45

Ratios

Dividend

payout ratio

Dividend cover

ratio

Dividend yield Earnings per

share

Cash gen from

ops per share

P/E ratio

Investment

Figure- 4



12/23

3. RATIO ANALYSIS - COMPARISON WITH SULTAN QABOOS PORT

COMPANY (COMPETITOR)

In order to demonstrate the actual performance of the Salalah Port Company during 2005

and 2006, we need to benchmark it with another company that having same sort of servicewhich is Sultan Qaboos Port Company as a competitor. The below Table 4 shows all theessential ratios which have been calculated based on the companies annual performancereport. The percentage values of the below table have been derived in the ratio table asseen in Appendix B.

Ratios SALALAH PORT SULTAN QABOOSPORT

Year 2006 2005 2006 2005

ROSF 14.12 15.13 18.81 17.21

ROCE 9.94 12.21 15.58 10.69

Net Profit Margin 19.78 20.35 24.93 19.38

Gross Profit Margin 45.03 48.03 90.52 88.51

Avg Settlement period for receivables 49.58 51.78 35.65 19.87

Sales revenue to capital employed ratio 0.60 0.72 0.90 0.73

Current Ratio 1.92 1.63 1.97 2.30

Acid test ratio 1.73 1.46 1.89 2.19

Cash gen from ops to maturing obligations 0.99 1.02 1.23 1.38

Gearing ratio 56.43 46.94 8.09 8.10

Dividend payout ratio 43.07 43.69 49.32 75.50

Earnings per share 23.10 22.77 63.36 52.98

Cash gen from ops per share 0.48 0.51 0.66 0.51

P/E ratio 22.94 22.37 9.23 8.93Table 4

From the above table, the following observations could be obtained:

3.1. PROFITABILITY

Sultan Qaboos Port has achieved an excellent year by scoring high revenues by 3million OMR more, whereas the Salalah Port had only almost 1.2 million OMRwhich is already reflected in the gross profit margin see Figure-5.

The decline in both ROSF and ROCE in 2006 for Salalah port was due to thehigher value for the non-current loans. In the other hand, Sultan Qaboos Port has asignificant increase in both and this is may due to high operating profits by 1.5 MOMR more in 2006 and there are no long term loans.



13/23

Profitability Ratios-2006

9.94

19.78

45.03

18.81

15.58

24.93

ROCE

Net Profit Margin

Gross Profit Margin

SALALAH PORT SULTAN QABOOS

Figure-5

3.2. EFFICIENCY

There is a good reduction in the settlement period for trade receivables from 51.8to 49.6 days which indicates an improvement for Salalah Port. Thus, some morefunds have been released from the trade receivables and to be used for other

profitable purposes. On the other hand, trade receivables for Sultan Qaboos Porthas declined and delayed from 19.8 days in 2005 to 35.6 days in 2006. Thedifference in the settlement period is due that Port of Sultan Qaboos is mainlydealing with local import and export where Port of Salalalh is mainlytransshipments hub.

The Sultan Qaboos Port has processed its assets very effectively and productivelyby 0.9 times in 2006 which indicates an increase from previous year, whereas theSalalah Port has lower ratio about 0.6 in 2006 times and declined from previousyear as can be seen in Figure 6. This is due to the fact that the equipment in PortOf Sultan Qaboos are old and their efficiency is at the maximum, where Port ofSalalah equipment are still new and they are still working on maximizing theefficiency, as well as purchasing new equipment and staffing for them, while the

volumes have yet to increase, Port of Salalah is implementing lean and six sigmamethods to improve their efficiency.



14/23

49.58

35.65

0.910

15

20

25

30

35

40

45

50

Efficiency Ratios- 2006

Avg Settlement period for receivables Sales revenue to capital emp

Figure-6

3.3. LIQUIDITY

The total assets of Port of Salalah are almost twice the total assets of Port SultanQaboos. Although, Port of Sultan Qaboos is the main port for the country and itwas built since 1970s.

Current ratio and Acid test ratio are nearly same for both in 2006, but it isnoticeable that Sultan Qaboos Port has sharp reduction for both ratios in 2005 to2006.

The cash generated from operations to maturing obligations, both ports havedeclined comparing their results with 2005 and Port of Sultan Qaboos decline washigher than Port of Salalah. But overall the cash generated from operation is Port ofSultan Qaboos is still 0.25 higher than Port of Salalah.

3.4. FINANCIAL GEARING

Salalah Port relies directly to the banking funds and their gearing ratio was 56% in2006 since it is developing and expanding, with building new berths and equipment

company whereas, -as expected- Sultan Qaboos Port having very low bankingfunds since it is established long back.

3.5. INVESTMENT

EPS has increased from 2005 to 2006 for both companies.

P/E for both companies has increased from previous year.



15/23


16/23

5. REFERENCES

Alnajjar, F and Belkaoui, A. (1999). Multinationality, Profitability and firm value.Managerial Finance. 25 (12). 31-41.

Business Knowledge Center.www.netmba.com,[April 6, 2008].

Dawkins, P, Feeny, S and Harris, M. (2007). Benchmarking Firm Performance.

Benchmarking, An International Journal. 14(6). 693-710.

Horngren, C, Datar, S and Foster , G. (12th ed) (2007). Cost Accounting: A

Managerial Emphasis. Prentice Hall, USA.

Ittelson, T. (1998). (1st ed). Financial Statements: A Step-By-Step Guide to

Understanding and Creating Financial Reports. Career Press, USA.

Leopold Bernstein, John Wild, (2000). Analysis of Financial Statements .McGraw

Hill, USA.

McLaney, E and Atrill, P. (4th ed) (2008). Accounting, an Introduction. Pearson

Education Limited, England.

Muscat Securities Market, http://www.msm.gov.om, [March 15, 2008].

Port Service Cooperation, http://www.pscoman.com/marketing/about1.htm#1,

[March 28, 2008]

Romney, M and Steinbart, P. (10th ed) (2005). Accounting Information Systems.

Prentice Hall, USA.

Salalah Port Company,http://www.salalahport.com/, [March 28, 2008].

http://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Charles%20T.%20Horngrenhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Srikant%20M.%20Datarhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Srikant%20M.%20Datarhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=George%20Fosterhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=George%20Fosterhttp://www.msm.gov.om/http://www.msm.gov.om/http://www.pscoman.com/marketing/about1.htm#1http://www.pscoman.com/marketing/about1.htm#1http://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Marshall%20B.%20Romneyhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Marshall%20B.%20Romneyhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Paul%20J.%20Steinbarthttp://www.salalahport.com/http://www.salalahport.com/http://www.salalahport.com/http://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Srikant%20M.%20Datarhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=George%20Fosterhttp://www.msm.gov.om/http://www.pscoman.com/marketing/about1.htm#1http://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Marshall%20B.%20Romneyhttp://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Paul%20J.%20Steinbarthttp://www.salalahport.com/http://www.amazon.com/exec/obidos/search-handle-url?_encoding=UTF8&search-type=ss&index=books&field-author=Charles%20T.%20Horngren


17/23

6. APPENDIX A



18/23



19/23



20/23



21/23



22/23



23/23

7. APPENDIX B

Ratio Companies

Port of Salalah Sultane Qaboos Port

2006 2005 2006 2005

Average settlement period for trade receivable= trade receivable 49.577 51.780 35.647 19.870

credit sales revenue * 365

Sales revenue to capital employed ratio= sales revenue 0.603 0.717 0.903 0.734

share capital+ reserve+noncurrent liabilities

Gross profit margin = Gross profit * 100 45.025 48.027 90.522 88.512

Sale revenue

ROSF = profit for the year (net profit ) less any preference dividend * 100

ordinary share capital + reserves 14.120 15.131 18.807 17.211

ROCE = operating profit

sahare capital +reserves + non-current liabilities *100 9.936 12.209 15.575 10.693

Operating Profit Margin = operating profit *100

Sales revenue 19.776 20.346 24.925 19.382

Current ratios = Current assets 1.917 1.629 1.968 2.303

Current liabilities

Acid test ratio = Current assets (excluding stock) 1.730 1.457 1.888 2.193

Current liabilities

Cash generated from Ops to maturing obligation = Cash generated from Ops 0.989 1.016 1.230 1.384

Current liabilities

Gearing ratio = Long term ( non current ) liabilities * 100 56.427 46.941 8.089 8.101

Share capital + Reserves + long term (non current) liabilities

Dividend payout ratio = Dividends announced for the year * 100

Earning for the year available for the dividends 43.067 43.687 49.324 75.499

Dividend cover ratio = Earning for the year available for the dividend * 100

Dividends announced for the year 2.310 2.278 1.810 1.325

Dividend yield = Dividend per share/ ( 1-t) * 100

Market value per share 1.887 1.960 5.128 7.400

Earning per share = Earnings available to ordinary shareholders * 100 23.098 22.770 63.356 52.981

Number of ordinary shares in issue

Cash generated from ops per share = Cash generated from ops less preferencedividend

0.483 0.506 0.664 0.511

Number of ordinary shares in issue

P/E = Market value per share 22.939 22.368 9.227 8.925

Earnings per share

MBA-SF-Group APage 23 of 23

salalah port report (a good report)

Documents