Type of Information Calculation of Ratios Interpretation

Profitabiity ratios Gross profit margin

=

Net profit margin

Return on Investment

Return on asset

Return on equity

Liquidity ratios Current ratio

= Current assets / Current
liabilities
= RM654,921,000 /
RM262,096,000
= 2.5:1

Acid test ratio

= (Total current assets - inventory
- prepayments) / Current liabilities
= (RM654,921,000 - 247,382,000
- 154,419,000) / RM 262,096,000
= 0.97:1

Efficiency ratios Inventory turnover ratio

= Cost of sales / Average
inventory
= RM1,654,776,000 /
RM( (247,382,000+434,658,000)
/ 2)
= 5 times

Non-current assets turnover

= Net sales / Non-current assets
= RM1,992,868,000 /
RM196,818,000
= 10.13

Total asset turnover

= Net sales / Total assets
= RM1,992,868,000 /
RM851,739,000
= 2.34
Gearing ratios Debt ratio
= Total liabilities / Total assets
= RM327,235,000 /
RM851,739,000
= 0.38

Debt to equity ratio

= Total liabilities / Shareholders’
equity
= (RM327,235,000 /
RM524,504,000) x 100
= 62.39%

Time interest earned

= Earnings before interest and tax
/ Interest expense
= RM202,707,000 / RM5,640,000
= 36 times

Market ratios Earnings per share

Dividend payout ratio

Price earnings ratio

2.1.1PROFITABILITY RATIOS

Calculation of Ratios Interpretation

Gross profit margin

= Gross profit / Revenue
= (RM338,092,000 / RM1,992,868,000) x 100
= 16.97%

Net profit margin

= Net profit / Revenue
= (RM150,963,000 / RM1,992,868,000) x 100
= 7.58%

Return on investment
= (Earnings before interest and tax / Capital employed) x 100
= (RM202,707,000 / RM589,643,000) x 100
= 34.38%

Return on asset
= (Net profit / Total assets) x 100
= (RM150,963,000 / RM851,739,000) x 100
= 17.72%

Return on equity
= (Net profit / Total equity) x 100
= (RM150,963,000 / RM524,504,000) x 100
= 28.78%

2.1.2 LIQUIDITY RATIOS

Calculation of Ratios Interpretation

Current ratio
= Current assets / Current liabilities
= RM654,921,000 / RM262,096,000
= 2.5:1

Acid test ratio

= (Total current assets - inventory - prepayments) / Current liabilities
= (RM654,921,000 - 247,382,000 - 154,419,000) / RM 262,096,000
= 0.97:1

2.1.3 EFFICIENCY RATIOS

Calculation of Ratios Interpretation

Inventory turnover ratio

= Cost of sales / Average inventory
= RM1,654,776,000 / RM( (247,382,000+434,658,000) / 2)
= 5 times

Non-current assets turnover

= Net sales / Non-current assets
= RM1,992,868,000 / RM196,818,000
= 10.13

Total asset turnover

= Net sales / Total assets
= RM1,992,868,000 / RM851,739,000
= 2.34
 2.1.4 GEARING RATIOS

Calculation of Ratios Interpretation

Debt ratio
= Total liabilities / Total assets
= RM327,235,000 / RM851,739,000
= 0.38

Debt to equity ratio

= Total liabilities / Shareholders’ equity
= (RM327,235,000 / RM524,504,000) x 100
= 62.39%

Time interest earned

= Earnings before interest and tax / Interest expense
= RM202,707,000 / RM5,640,000
= 36 times

2.1.5 MARKET RATIOS

Calculation of Ratios Interpretation

Earnings per share (EPS) ***PAGE 118 PDF

= (Net profit - Preference dividends) / Number of shares outstanding
= RM139,975,000 / 1,154,623,000
= RM0.12

Dividend payout ratio ***PAGE 61 & 119 PDF

= (Total dividends / Total earnings) x 100
= (RM98,780,000 / RM150,963,000) x 100
= 65.43%

Price earnings ratio

= Market price of shares / EPS
= RM1.97 / RM0.12
= 16 times