financial analysis m&p

7/23/2019 Financial Analysis M&P

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Executive summary

Mallouppas & Papacostas Trading Co. Ltd. (M&P Public Co. LTD) is a leadingcommercial group in Cyprus launc!ed in "#$% it! activities in t!e 'ields o' satellite

systems antennas and !ouse!old appliances and electrical goods. n t!e 'as!ion

maret originally entered in "##* it! t!e creation o' t!e Linea Moderna +!oes.

,oever t!e last -* years !as success'ully manage to diverse and be involved in t!e

retail o' 'as!ion brands indoor and outdoor 'urniture !ouse!old electrical &

electronic goods and t!e distribution o' satellite & telecommunication products.

n "## t!e group broug!t in Cyprus M/012 s!ops !ic! 'ormed t!e 'irst

integrated 'ranc!ise t!at came into place a concept !ic! !as c!anged and de'ined

t!e s!ape and pat! o' t!e Cyprus maret and in particular t!e !ig! street trade.

Today it! 3 branc!es all over Cyprus t!e group still represents eig!t international

brands o' clot!ing 'ootear and 'as!ion accessories4 ntimissimi Cal5edonia

+tradivarius Playli'e 6agatt 7omen 8+ecret Te5enis 9ipling /nd C!arles & 9eit!.

/lso imports and distributes satellite systems and antennas t!roug! Mp +at ireless

and landline p!ones via Prototel operates t!e store +atellite & Electronics in 0icosia

and t!e :;Day Clearance !ic! became an institution in Cyprus maret.

T!e rapid expansion o' Mallouppas & Papacostas 1roup and its excellent reputation

bot! in Cyprus and among its overseas associates results 'rom t!e commitment to

identi'y and exploit ne products and as ell as emerging maret trends. Mallouppas

& Papacostas Public Co. Ltd as listed on t!e Cyprus +toc Exc!ange in December

"###.


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". ntroduction

"." Purpose o' t!e pro


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t!is 'ranc!ise opened t!e ay 'or ne 'as!ion related business ventures. More

'ranc!ise agreements ere signed it! ell;non international brands suc! as

Playli'e ntimissimi Cal5edonia Te5enis +tradivarius 6agatt 7omen>secret and

9ipling. T!ese establis!ed brands !elped M&P to penetrate t!e 'ield o' 'as!ion and

alloed t!e group to ac=uire invaluable no;!o on retail promotion and outlet

management. n addition to its 'as!ion activities t!e group closely 'ollos

tec!nological developments in telecommunications satellite systems electrical and

electronic goods o''ering a compre!ensive range o' !ig! tec!nology products in its

on s!ops and ot!er selected outlets. T!e group also !as a dynamic presence in t!e

!ouse!old accessories sector it! extensive lines in tableare itc!en accessories

and gi'ts. T!e group operates on a to mont!ly basis a discount outlet selling indoor

and outdoor 'urniture !ouse!old goods electrical appliances and a large variety o'

ot!er products at lo prices.

T!e strategic location o' t!e group>s retail s!ops in ey commercial streets across t!e

island ensures prestigious product promotion and access to a ide public. T!e

group>s netor currently consists o' more t!an 3 s!ops across Cyprus and continues

to gro.

T!e group>s commitment to identi'ying and exploiting ne products and trends !as

contributed to its excellent reputation bot! in Cyprus and among its overseas

associates. n eeping it! its dynamic development to date t!e group ill continue

to see ne marets and invest in products to satis'y consumer needs created by ever;

c!anging social trends.

Mallouppas & Papacostas 1roup represents t!e 'olloing brands in Cyprus under t!e

names o' t!e subsidiary companies o' t!e 1roup4

M&P Clot!ing Ltd ; Mango

M&P @oung ?as!ion Ltd ; +tradivarius

M&P +imear&,osiery Ltd ; Cal5edonia

M&P ntimates Ltd ; ntimissimi

M&P @oung ntimates Ltd ; Te5enis

M&P ?ootear&/ccessories Ltd ; 6agatt

LM1i't ; 9ipling


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M&P +!oes&/ccessories Ltd ; C!arles & 9eit!

M&P Leisureear Ltd ; Playli'e

?as!ion

T!e group !ic! entered t!e 'ield o' 'as!ion in "#%% by importing personal gi'ts and

sc!ool accessories is today involved in a ide range o' activities at t!e cutting edge

o' contemporary international design. T!ese include sports casual and evening ear

as ell as gi'ts 'ootear leat!er goods undergarments simear and !osiery.

T!e company>s pioneering 'ranc!ise agreement it! t!e +panis! company M/012

in "## broug!t t!e 'irst ever European retail c!ain to Cyprus revolutionising t!e

'as!ion maret on t!e island. T!is success led to a series o' ot!er 'ranc!ise

agreements it! renoned companies suc! as PL/@L?E 0TM++M

C/LAED20/ +TB/D/B+ 6/1/TT 72ME0>+ECBET and 9PL01 and

t!e establis!ment o' retail outlets all over t!e island.

0o e''ort is spared in t!e pursuit o' customer satis'action. T!e company>s s!ops in

central commercial locations o''er an aest!etic environment 'or easy s!opping it!

sta'' alays ready to respond to individual customer needs. T!e group remains

committed to providing excellent =uality 'as!ion products at a''ordable prices.

T!e group invests continuously in training sta'' to provide pro'essional customer

service bot! during and a'ter t!e sale. T!is excellent customer service provides t!e

group it! a uni=ue competitive advantage !ic! competitors 'ind extremely di''icult

to matc!.

?our Day Clearance

T!e ?2B D/@ CLE/B/0CE concept 'eatures a retail sale activity t!at taes place

'or several days every to mont!s. Customers can c!oose 'rom an enormous variety

o' !ouse!old goods indoor and outdoor 'urniture electrical appliances gym

e=uipment gi'ts toys and many more products.

T!e main c!aracteristic o' t!is activity is t!e excellent relation o' =uality to price and

t!e !ig! level o' customer service during and a'ter t!e sale. T!e reason be!ind t!e


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success o' t!e ?2B D/@ CLE/B/0CE is t!e good =uality value 'or money

products and t!e large number o' repeat customers.

Tec!nology

M&P !olds an important position in t!e !olesale and retail marets 'or

tec!nological goods in Cyprus.

T!is success story began in t!e "#%*s !en t!e group identi'ied and responded to t!e

!uge demand 'or domestic antennas later expanding its activities outside Cyprus.

Today t!e group is associated it! top =uality products and dominates t!e satellite

maret on t!e island as t!e exclusive distributor 'or many international suppliers.

T!e group>s groing experience and tec!nical noledge led to t!e gradual

expansion o' its activities. 7it! t!e establis!ment o' PB2T2TEL in "#%# t!e group

penetrated t!e telecommunications maret and today commands a large s!are o' sales

o' telep!one appliances cordless p!ones ansering mac!ines 'ax mac!ines and

telep!one systems. T!e company>s brand range consists o' Panasonic /lcatel

Topcom and 1eneral Electric telep!ones including cordless p!ones ansering

mac!ines 'axes and oP telep!ones.

T!e company operates one retail outlet in 0icosia and ors closely it! more t!an

"3* dealers o' electrical goods and specialised telecommunications stores as ell as

supermarets and department stores. PB2T2TEL is also t!e exclusive distributor o'

Panasonic P/6 telep!one systems.

T!e management alays eeps a close eye on tec!nological developments in t!e 'ield

o' satellite tec!nology providing clients it! t!e latest tec!nology products available

and at t!e same time a compre!ensive customer service.

MP +/T dominates t!e maret in t!e import and distribution o' antennas and satellite

systems including dis!es receivers and ot!er accessories and e=uipment. MP +/T

distributes its products across Cyprus t!roug! a ell;organised netor o' !olesale

dealers and retailers. T!e company also operates a retail s!op in 0icosia under t!e

name F+atellite & ElectronicsG. T!e group remains committed to monitoring

tec!nological developments in all its 'ields o' activity. n t!is ay it ill continue to


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provide its customers it! up;to;date products and t!e !ig!est standards o' service in

its many retail stores.


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BOARD OF DIRECTORS

Polys Mallouppas ; Executive C!airman

Costas Papacostas ; /8 Executive ice;C!airman

Minos C!aralambous; 68 Executive ice;C!airman

/ndreas Mallouppas ; Managing Director

Li5a Mallouppa ; Director

@iannis /ntoniades ; Director

Costas Toumbouris ; Director

angelis +yopetritis ; Director

EXECUTIVE MANAGEMENT TEAM

Polys Mallouppas ; Executive C!airman

Costas Papacostas ; /8 Executive

Minos C!aralambous; 68 Executive ice;C!airman

Li5a Mallouppa ; Director

/ndreas Mallouppas ; Managing Director

Maria Mallouppa ; /ssistant Managing Director

COMPANY SECRETARY

MPT Secretarial Services Limite

Re!istere "##ice

/cropoleos /v. " ; -*** /cropoli ; 0icosia

AUDITORS

Priceater!ouseCoopers Limited

BAN$ERS

Mar'in Popular 6an Public Co Limited

6an o' Cyprus Public Co Ltd.

+ociete 1enerale Cyprus Limited


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Pireaus 6an (Cyprus) Limited

,ellenic 6an Public Company Ltd

LEGAL ADVISORS

C. 9allis & D. 9allis


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-. ?inancial statements

?inancial statements are use'ul as t!ey can be used to predict 'uture indicators 'or a'irm using t!e 'inancial ratio analysis. ?rom an investor>s perspective 'inancial

statement analysis aims at predicting t!e 'uture pro'itability and viability o' a

company !ile 'rom t!e management>s point o' vie t!e ratio analysis is important

as it !elps anticipate t!e 'uture conditions in !ic! t!e 'irm s!ould expect to operate

and 'acilitates strategic decision maing (6rig!am and ,ouston -**$ p. $$).

2ne o' t!e most idely used 'orms o' 'inancial analysis is t!e use o' ratios. T!ey can

provide data t!at is use'ul 'or investment decisions. T!ey can also !elp internal

management o' an organi5ation gain an aareness o' t!eir company8s strengt!s and

eanesses. /nd i' e can 'ind eanesses e can move to correct t!em be'ore

severe !arm is done.

Batios can be grouped in H main areas4

Per'ormance (pro'itability) I ,o ell !as t!e business done

Position (li=uidity) I +!ort term standing o' t!e business

Potential (investor) I 7!at investors are looing at


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Pr"#ita%ilit& rati"s

1ross pro'it margin ratio is t!e ratio o' gross pro'it o' a business to its revenue. t is a

pro'itability ratio measuring !at proportion o' revenue is converted into gross pro'it.

t s!os t!e pro'itability o' sales a'ter t!e costs o' sales !as been deducted. T!is ratio

is important to t!e 'irm in order 'or t!e 'irm compare !o muc! gross pro'it t!ey are

maing and may !elp t!em come up it! ne ideas to increase sales or discover !y

sales !ave decreased.

1ross pro'it Margin

(1ross Pro'it J +ales) K "**

-*"* ("H3-".H*3JH::-$."#%)K"** H#H

-*"" ("3HH:.3#JH#-3-."3-)K"** H#

T!e gross margin is not an exact estimate o' t!e company8s pricing strategy but it does

give a good indication o' 'inancial !ealt!. 7it!out an ade=uate gross margin a

company ill be unable to pay its operating and ot!er expenses and build 'or t!e


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'uture. n general a company8s gross pro'it margin s!ould be stable. t s!ould not

'luctuate muc! 'rom one period to anot!er unless t!e industry it is in !as been

undergoing drastic c!anges !ic! ill a''ect t!e costs o' goods sold or pricing

policies. /s e can understand t!e gross pro'it margin 'or M&P Public Co. Ltd is

been stable 'or t!e past to years.

".Beturn on Capital Employed

(Pro'it be'ore interest and tax J Capital Beserves and long term liabilities) K "**

-*"* (;H-:.3"J-$H*.H-#N"HH%.$%#)K"**

-*"" (--3*.:#:J-%*3.%%N"H:$#.$3%)K"** 3H3

Beturn on Capital Employed is a measure o' t!e returns t!at a company is maing

'rom its capital. T!e advantage o' B2CE is t!at it is very transparent !ic! is !y it

is !ig!ly regarded by investors.


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-.2perating Pro'it Margin

( Pro'it be'ore interest and tax J +ales) K "**

-*"*

-*"" (--3*.:#:JH#-3-."3-)K"** 3$H


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H./sset Turnover

(+ales J Capital Beserves and long term liabilities) K "**

-*"* (H::-$."#%J-$H*.H-#N"HH%.$%#)K"** %:*

-*"" (H#-3-."3-J-%*3.%%N"H:$#.$3%)K"** #H-$

T!is ratio measures !o e''ectively a company uses its total resources to generate

sales. ?or any company t!is ratio !elps in deciding !et!er t!e company8s Ooperations

!ave been 'inancially e''ective.O (1itman pg.- -**)

T!e /sset Turnover ratio s!os !o muc! sales are generated 'or every " o' capital

employed. / lo asset turnover indicates t!at t!e business is not using its assets

a''ectively and s!ould eit!er try to increase its sales or dispose o' some o' t!e assets.

M&P Public alt!oug! it !as a !ig! rate o' assets turn over bot! years in -*"" t!e

sales as increased by ":. T!e increase is mainly due to t!e 'act t!at t!e 1roup as

one o' t!e main suppliers o' digital MP: decoders 'or digital Ts.


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/verage Collection Period

/ccounts receivable J (/nnual Credit +alesJH3)

-*"* "#$H.%"J(H::-$."#%JH3) -"

-*"" -*-*.:H-J(H#-3-."3-JH3) "#

T!e average collection period ratio represents t!e average number o' days 'or !ic! a

'irm !as to ait be'ore its debtors are converted into cas!. T!is ratio measures t!e

=uality o' debtors. / s!ort collection period implies prompt payment by debtors. t

reduces t!e c!ances o' bad debts. +imilarly a longer collection period implies too

liberal and ine''icient credit collection per'ormance.

n t!e case o' M&P Public Co. Ltd t!e average collection period 'or -*"* as -" days

and 'or -*"" as "# days.

T!e di''erence may sound small but - days is a signi'icant number !en it comes to

receiving oed money.

T!ese results ere become 'rom t!e important increase in sales by 3 milions but

mainly 'rom t!e signi'icantly decrease o' t!e !olesale debtors and t!e increase o'

t!e daily retail sales.


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:.Beturn on E=uity Batio

(Pro'it available to ordinary s!ares J +!are CapitalNBeserves) K "**

-**% ".%-3.$H#J-.#-#.K"** $%

-**$ .-##."#$J-.#-%.%H"K"** -HH#

LDT@ B/T2+

/n indication o' a company8s ability to meet s!ort;term debt obligationsQ t!e !ig!er

t!e ratio t!e more li=uid t!e company is. Current ratio is e=ual to current assets

divided by current liabilities. ' t!e current assets o' a company are more t!an tice

t!e current liabilities t!en t!at company is generally considered to !ave good s!ort;

term 'inancial strengt!. ' current liabilities exceed current assets t!en t!e company

may !ave problems meeting its s!ort;term obligations.

3.( Current Batio )

Current /ssets J Current Liabilities

-*"* "3%%$.3:3J"-H-.*" "-%34"

-*"" "3"".$H-J":%-H.$#- "*3H4"

T!e current ratio provides an estimate o' t!e ability o' t!e company to pay i'

necessary s!ort;term obligations using t!e cas! available plus ot!er current assets

!ic! could relatively easily (it!in "- mont!s at most ) convert 'luid. /ccording to

Mars!all (-**-) T!e li=uidity o' a company is t!e ability to meet its loan obligations

as it relates to its current assets and its current liabilities.


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T!is means t!at t!e current assets o' M & P cover current liabilities by ".*3H times in

-*"" unlie in -*"* as ".-%3. Considered satis'actory alt!oug! it !as a signi'icant

decrease 'rom t!e previous year but !en you consider t!e cas! o' t!e company it

seems t!at M & P !as no li=uidity problems.

n t!e case o' li=uidation o' t!e company t!e need 'or 'ast 'luidi5ation t!e current

assets o' M & P ill not be su''icient to 'ully repay all creditors a'ter4

"3"".$H- x 3* R $%*3.% S "-H-.*"

.( uic Batio )

(Current /ssets I nventory) J Current Liabilities

-*"* ("3%%$.3:3;3.:$H)J"-H-.*" *$34"

-*"" ("3"".$H-I%H:H.33)J":%-H.$#- *:#4"

T!e uic ratio measure more accurately t!e actual li=uidity o' t!e company

because is not counting stocs t!at need a little more time to be li=uidate in relation

to accounts receivable 'rom trade debtors. . t is usually in a company8s best interests

not to !ave to get rid o' t!eir inventory in order to pay o'' creditors because t!is

leaves t!em it! more assets.

T!e M & P in -*"" presents immediate li=uidity ratio *:#4" suggesting t!at direct

li=uid assets are insu''icient 'or t!e immediate repayment o' current liabilities. n

-*"* amounted to *$34" considerably !ig!er t!an in -*"". T!ese results ere

become 'rom t!e slig!t increase in trade and ot!er receivables but mainly 'rom t!e

vast increase o' creditors. T!ere'ore t!e assets o' t!e company are not su''icient eit!er

in !al' 'or t!e direct payment o' current liabilities. /lt!oug! i' e tae into

consideration t!at t!e stocs count as H"J"-J-*"" be'ore t!e sales period and

beteen C!ristmas !olidays e can assume t!at most o' t!e stoc ill be sold in t!e

'irst mont! o' -*"-.


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I'vest"rs rati"

$.Earnings per s!are (EP+)

Pro'it a'ter tax and pre'erence dividend J 0umber o' ordinary s!ares

-*"*

-*"" "H--:#%J:H-"*.%$ *.*H"

Ear'i'!s (er s)are *EPS+ rati"t is a popular measure o' overall pro'itability o' t!e

company. t measures !o many euro o' net income !ave been earned by eac! s!are

o' common stoc. t is computed by dividing net income less pre'erred dividend by

t!e number o' s!ares o' common stoc outstanding during t!e period.

%.PE ratio (PriceJearnings per s!are)

Maret price per s!areJ EP+

-*"*

-*"" *."$#J*.*H" 3.%

Price ear'i'!s rati"s *P,E rati"+measures !o many times t!e earnings per s!are

(EP+) !as been covered by current maret price o' an ordinary s!are. t is computed

by dividing t!e current maret price o' an ordinary s!are by earnings per s!are.

#.Dividend yield

(Dividend per s!are J Maret price per s!are) K"**

-*"*

-*""


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Divie' &ielratio is calculated by dividing t!e dividend per s!are by maret value

per s!are. T!is ratio is used to measure t!e relations!ip beteen t!e amount o'

dividend per s!are and t!e current maret price per s!are. 6ot! years -*"* and -*""

M&P 1roup didn>t s!are any dividend.

"*.Dividend Cover

Pro'it a'ter interest and tax J Dividend (in income statement)

-*"*

-*""

Divie' c"vera!eratio s!os !et!er t!e company generates enoug! cas! ('rom

operating cas! 'lo) 'or dividend payout. Data to calculate t!is ratio is collected 'rom

t!e stoc maret bulletin and cas! 'lo statement.

Dividend is a part o' company>s net income paid to t!e company>s s!are!olders so it

is obvious t!at t!is ratio mainly interests t!em. /lso it mig!t be interesting 'or t!ose

!o are een on buying company>s s!ares.


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coverage ratios

T!e coverage ratios s!o t!e viability o' t!e company and !et!er t!e available

operating earnings provide sa'ety 'or a''ordability in various existing repayments.

Debt +ervice Coverage Batio

0et Pro'it N Depreciation N 0on Cas! Expenses J Current Maturities o' Long Term Debt

-**% ".:"3.**3N-.%-:.:*:J".:".3* -.#*4"

-**$ 3.$:*.*%"N".:-".J".H"."$" 3.-4"

UVWX Y Z[\]V^X Z[\_`[ WV V ]Z^ V^X [_[\^f^X fU` VX Yff[X fU` h^

_^hV] jYZ hYYk` ` ]kYU` VX V_YUf[X ZWf[X h]YW[fh`

Z`[\` ]V -#* YX VY -**% [`q VY -**$ V` 3-.

". Batio

0et Pro'it 6e'ore nterest and Taxes J nterest Expense

-**% -.%#*.*$*J#$$.333 -.#4"

-**$ $."3.-HJ%:".3-: %.3"4"

w &P _[ V^ ZU`VWV^V h[ V ]Z^ V^X ` Y^q`[ `[V VYUX VW]YUX V`

Z`[\` V^X ]Wh^ ] ` Uj^Yk` V [VW]. _[ h[z^ ZU`VWV^V

.

+ummari5e Besults


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-*"*

T!e turnover o' t!e 1roup during t!e 'irst !al' o' -*"* amounted to ".*$H.:":

compared it! -.:#.::3 in t!e corresponding period o' -**# a decrease o'

H#.$. T!e decrease is due to t!e 'olloing 'acts4

During t!e 'irst !al' o' -**# t!e turnover o' t!e company included sales o' property

amounting :.%"%.***. During t!e 'irst !al' o' -*"* t!ere as no sale in t!e real

estate sector.

T!e turnover o' t!e 'irst !al' o' -**# includes sales o' companies Emilios Eliades

Trading Ltd and Mallouppas Papacostas & Commercial Enterprises nc. amounting to

3.:*-.$%% and -3%.H*# respectively !ose activities ere terminated in -**#.

T!e gross pro'it o' t!e 1roup 'or t!e 'irst !al' o' -*"* amounted to .3H%.#H

compared to "*."".-- it! t!e corresponding period o' -**#. T!e gross pro'it 'or

t!e 'irst !al' o' -*"* as :*.$ compared it! H%.* in t!e 'irst !al' o' -**# an

increase o' $.".

T!e loss attributable to s!are!olders 'or t!e 'irst !al' o' -*"* as ".3%%*

compared it! a pro'it %--.%## in t!e corresponding period o' -**#.

Pro'it 'rom continuing activities t!e 'irst !al' o' -**# includes gain on property sales

H.H million !ile in t!e corresponding period o' -*"* t!ere as no activity in t!is

area. /dditional pro'it 'rom ot!er business activities o' t!e 1roup in t!e 'irst !al' o'

-*"* is reduced by ".- million compared to t!e same period in -**# a result o'

adverse economic conditions prevailing maret conditions.

-*""

T!e turnover o' t!e 1roup during t!e 'irst !al' o' -*"" amounted to "$.$$%."-

compared to ".*$H.:": in t!e corresponding period o' -*"* recording an increase

o' "*.. T!e increase is mainly due to t!e 'act t!at t!e 1roup as one o' t!e main

suppliers o' digital decoders t!us ac!ieved additional sales o' "."3#. $*H.

T!e gross pro'it o' t!e 1roup 'or t!e 'irst !al' o' -*"" amounted to $.H%.:#*

compared to .3H%.#H in t!e corresponding period o' -*"*. T!e gross pro'it 'or t!e

'irst !al' o' -*"" amounted to :".: compared it! :*.$ in t!e 'irst !al' o' -*"*.


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T!e pro'it attributable to s!are!olders 'or t!e 'irst !al' o' -*"" amounted to H33##

compared it! a loss o' ".3%.%* in t!e corresponding period o' -*"*.

T!e signi'icant improvement is due to t!e additional pro'it resulting 'rom sales o'

digital decoders as ell as signi'icant reductions in operating costs.

-./-

T!e results in -*"- ere negatively a''ected by t!e e''ects o' t!e economic crisis t!at

!as plagued several sectors o' t!e Cyprus economy and generally t!e economy o'

European countries.

T!e turnover o' t!e 1roup during -*"- amounted to H.H compared it! H#.-3

in t!e corresponding period o' -*"" recording a decrease o' .$. T!e decrease is

due to t!e 'act t!at sales in -*"" included sales o' digital decoders amounted to -.$"

t!at ere not repeated in -*"-.

T!e 1roup in -*"- in an attempt to disengage 'rom !arm'ul activities and any

activities in !ic! t!ere !as no comparative competitive superiority sold t!e company

named Prototel Co Ltd. Prototel Co Ltd specialises in t!e import and !olesale

distribution o' telecommunication products.

Moreover M&P public Co. Ltd in t!e 'irst =uarter o' -*"H decided to end t!e

activities o' t!e subsidiary company Mallouppas & Papacostas Leisureear Ltd

representative o' t!e brand Playli'e.

T!e balance scorecard

/ more recent contribution to strategic management accounting t!at emp!asises t!e

role o' management accounting in 'ormulating and supporting t!e overall competitive

strategy o' an organi5ation is t!e balance scorecard. /ccording to C!andler and

+alsbury ("#$") t!e 6alanced scorecard retains t!e traditional 'inancial measures and

complements t!em it! measures t!at are drivers o' 'uture per'ormance. T!e

ob


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provide t!e 'rameor 'or t!e 6alanced scorecard. T!e balanced scorecard is a

management system (not only a measurement system) t!at enables organi5ations to

clari'y t!eir vision and strategy and translate t!em into action. /s stated by Drucer

("#3:) it provides 'eedbac around bot! t!e internal business processes and external

outcomes in order to continuously improve strategic per'ormance and results. 7!en

'ully deployed t!e balanced scorecard trans'orms strategic planning 'rom an

academic exercise into t!e nerve center o' an enterprise. 9aplan and 0orton ("##

pg. $3) describe t!e innovation o' t!e balanced scorecard as 'ollos4 OT!e balanced

scorecard retains traditional 'inancial measures. 6ut 'inancial measures tell t!e story

o' past events an ade=uate story 'or industrial age companies 'or !ic! investments

in long;term capabilities and customer relations!ips ere not critical 'or success.

1reenood ("#%") claims t!ese 'inancial measures are inade=uate !oever 'or

guiding and evaluating t!e


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communication maes managers and employees 'ocus on t!e critical drivers enabling

t!em to align investments initiatives and actions accomplis!ing strategic goals

,el'ert (-**"). ,istorically t!e measurement system 'or any business !as been

'inancial. /ccounting as considered to be t!e language o' business nnovations in

measuring t!e 'inancial per'ormance o' t!e industrial age companies played a vital

role in t!eir success'ul grot!. /nd 'inancial innovations suc! as t!e Beturn on

nvestment (B2) metric and operating and cas! budgets ere critical to t!e success

o' t!ese corporations.

Conclusion

?inancial ratios s!ould be used as indicators s!oing !ere strengt!s and eanesses

lie. T!is is important to any ban or investor because it reveals i' t!e company is

liely to become pro'itable. 6y using ratios to compare past present and 'uture

numbers any ban or investor ill no i' t!e company ill be able to repay its

debts mae money or


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Be'erences

6rig!am E. and ,ouston {. (-**$). ?undamentals o' ?inancial Management.

Mason4 T!omson Publis!ing Limited.

C!andler /. and +alsbury +. ("#$")Pierre DuPont and the making of the modern

corporation. 0e @or4 ,arper and Bo.

Colin Drury Management and Cost /ccounting $t!edition (p. 3$;3%$)

1itman Larence {. (-**) Principles o' Managerial ?inance (""t! ed.) pper

+addle Biver 0.{.4 Pearson Prentice ,all

Mars!all D.,. McManus 7.7. iele D.?. /nt!ony B.0. ,ains D.?. and

Merc!ant 9./. (-**-). /ccounting4 7!at t!e 0umbers Mean ?i't! Edition

!ttp4JJmppublic.comJboard;directors

!ttp4JJmppublic.comJabout;company

!ttp4JJaccountingexplained.comJ'inancialJratiosJdividend;yield

!ttp4JJ.investopedia.comJtermsJgJgross|pro'it|margin.asp}ix55-0oTAM,9

!ttp4JJmarets.'t.comJresearc!JMaretsJTears!eetsJ?inancials~

sRMPTCEB4P/B&subvieRCas!?lo
http://mppublic.com/board-directorshttp://mppublic.com/about-companyhttp://accountingexplained.com/financial/ratios/dividend-yieldhttp://www.investopedia.com/terms/g/gross_profit_margin.asp#ixzz2NoTZMHkKhttp://markets.ft.com/research/Markets/Tearsheets/Financials?s=MPTCEUR:PAR&subview=CashFlowhttp://markets.ft.com/research/Markets/Tearsheets/Financials?s=MPTCEUR:PAR&subview=CashFlowhttp://mppublic.com/about-companyhttp://accountingexplained.com/financial/ratios/dividend-yieldhttp://www.investopedia.com/terms/g/gross_profit_margin.asp#ixzz2NoTZMHkKhttp://markets.ft.com/research/Markets/Tearsheets/Financials?s=MPTCEUR:PAR&subview=CashFlowhttp://markets.ft.com/research/Markets/Tearsheets/Financials?s=MPTCEUR:PAR&subview=CashFlowhttp://mppublic.com/board-directors


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A((e'ices

6alance +!eet

?iscal data as o' Dec H" -*"- Dec H" -*"- Dec H" -*"" Dec H" -*""

/++ET+

Cas! /nd +!ort Term

nvestments-." -."" :.-"

Total Beceivables 0et -." -.*- ".#$Total nventory "- "" "*

Prepaid expenses ;; ;; ;;

2t!er current assets total ;; ;; ;;

Total current assets " " "

Property plant & e=uipment

net"* "" ""

1oodill net ;; ;; ;;ntangibles net -.%- -.%: 3.$:

Long term investments -% -% -*

0ote receivable ; long term ;; ;; ;;

2t!er long term assets ;; ;; ;;

Total assets 3$ 3$ 3H

L/6LTE+

/ccounts payable $.3% %." .""

/ccrued expenses ;; ;; ;;

0otes payableJs!ort;term debt .#: :.3- .:*

Current portion long;term

debtJcapital leases".3" ".3: ".##

2t!er current liabilities total *.*- *."3 *."3

Total current liabilities " "3 ":

Total long term debt "" "" "-


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?iscal data as o' Dec H" -*"- Dec H" -*"- Dec H" -*"" Dec H" -*""

Total debt -* "% -*

De'erred income tax -.*" -.** ".3$

Minority interest *.H *.H *.H$

2t!er liabilities total ;; ;; ;;

Total liabilities H* -# -$

+,/BE,2LDEB+ ET@

Common stoc "3 "3 "3

/dditional paid;in capital ;; ;; ;;

Betained earnings

(accumulated de'icit)

"H "" "-

Treasury stoc ; common ;; ;; ;;

nreali5ed gain (loss) ;; ;; ;;

2t!er e=uity total ;; -.$" ;;

Total e=uity -$ -% -$

Total liabilities & s!are!olders8

e=uity3$ 3$ 3:

Total common s!ares

outstanding:H :H :H

Treasury s!ares ; common

primary issue;; ;; ;;

Pro'it and Loss

?iscal data as o' Dec H" -*"- -*"- -*"" -*"*

BEE0E /0D 1B2++ PB2?T

Total revenue H$ H# H:

2PEB/T01 EPE0+E+

Cost o' revenue total -H -: -"

+elling general and admin. expenses

total "- "- "-


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DepreciationJamorti5ation ;; ;; ;;

nusual expense(income) (*.-) (".-%) (*.%$)

2t!er operating expenses total -.$ -.: -.#*

Total operating expense H H H3

2perating income *."$ -.%" (*.)

2t!er net ;; (*.*") (*."H)

0C2ME T/E+ M02BT@ 0TEBE+T /0D ETB/ TEM+

0et income be'ore taxes (*.%:) ".%* (".3#)

Provision 'or income taxes *."$ *.:$ *."

0et income a'ter taxes (".*") ".H- (".$3)

Minority interest *.** *.** *.**

0et income be'ore extra. tems (".*") ".H- (".$3)

Total extraordinary items (*.$#) ;; (*.$%)

0et income (".$#) ".H- (".$3)

nc.avail. to common excl. extra.

tems(".*") ".H- (*.#$)

nc.avail. to common incl. extra.

tems(".$#) ".H- (".$3)

EP+ BEC20CL/T20

6asicJprimary eig!ted average

s!ares:H :H :H

6asicJprimary eps excl. extra items (*.*-) *.*H (*.*:)

6asicJprimary eps incl. extra items (*.*:) *.*H (*.*-)

Dilution ad


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Pro 'orma net income ;; ;; ;;

nterest expense supplemental ;; ".** *.%"

+PPLEME0T/L 0C2ME

Depreciation supplemental ;; ".HH ".-#

Total special items (*.-) (".-%) (*.%$)

02BM/LAED 0C2ME

0ormali5ed income be'ore taxes (".*#) *.3- (-.:)

E''ect o' special items on income

taxes(*.*#) (*.H:) (*.H*)

ncome tax excluding impact o'

special items*.*% *.": (*."3)

0ormali5ed income a'ter tax ("."$) *.H% (-.H")

0ormali5ed income avail. to common ("."$) *.H% (-.H")

6asic normali5ed EP+ (*.*H) *.*" (*.*3)

Diluted normali5ed EP+ (*.*H) *.*" (*.*3)


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