ATTOCK PETROLEUM LIMITED

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited ATTOCK PETROLEUM LIMITED Attock Petroleum Limited (APL) is an associates company of Attock Oil Group of Companies, which is the only fully vertically integrated group in Oil & Gas sector of Pakistan involved in exploration and production, refining & marketing. The company products include Asphalt, Furnace Oil, Light Diesel Oil, Lube Base Oil, Jute Batching Oil, Solvent Oil and Mineral Turpentine Tar. APL corporate head office is registered in Islamabad. Attock Petroleum Limited (APL) is the 4th Oil Marketing Company in Pakistan to be granted a marketing license in February 1988. Through a new entrant in the field of oil marketing, APL has managed to establish its presence and reputation as a progressive and dynamic organization focusing on providing quality and environment friendly petroleum products and services in Pakistan and abroad. Its steady and substantially growing market share and customer confidence, which it enjoy, and manifestations of APL successful policies, APL is part of the fully integrated Oil Company of the subcontinent; APL sponsors included Pharaon Commercial Investment Group Limited and Attock Group of Companies. Vision: To become a world class, professionally managed, fully integrated, customer focused, Oil Marketing Company, offering value added quality and environment friendly products and services to its customers in Pakistan and beyond. 1 Mission: To continuously provide quality and environment friendly petroleum products and related services to industrial, commercial and retail consumers, and exceeding their expectations through reliability, economy and quality of products and services. We are committed to benefiting the community and ensuring the creation of a safe, responsible and innovative environment geared to client satisfaction, end user gratification, employees' motivation and shareholders value.2

1 2

http://www.apl.com.pk/ http://www.apl.com.pk/

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Profit/Loss Statement (2007-2011) 2011 Sales 127,036,966.00 94,897,866.00 70,724,427.00 60,130,125.00 49,939,190.00 Less Sales Tax 17,642,241.00 Net Sales 109,394,725.00 82,791,918.00 61,863,152.00 53,242,330.00 44,130,536.00 Cost of Good Sold 104,680,507.00 79,032,034.00 58,570,802.00 50,493,929.00 42,085,565.00 Gross Profit 4,714,218.00 Other Operating Income 1,978,931.00 Operating Expenses 611,315.00 Operating Profit 6,081,834.00 Financing Cost 682,666.00 Income on Bank Deposit & Short Term Investment Share of profit of associates Other charges Profit before Taxation 6,017,511.00 Taxation 1,761,000.00 Net Profit 4,256,511.00 3,594,309.00 3,082,419.00 2,641,552.00 1,728,606.00 1,252,000.00 1,198,000.00 888,000.00 707,000.00 4,846,309.00 4,280,419.00 3,529,552.00 2,435,606.00 962,838.00 93,211.00 437,706.00 319,865.00 980,736.00 42,337.00 444,827.00 28,992.00 848,852.00 26,510.00 225,199.00 381,910.00 58,918.00 183,366.00 351,747.00 42,319.00 126,401.00 4,587,928.00 3,659,248.00 3,272,090.00 2,167,941.00 480,860.00 477,069.00 372,670.00 283,284.00 1,308,904.00 843,967.00 896,359.00 406,218.00 3,759,884.00 3,292,350.00 2,748,401.00 2,044,971.00 12,105,948.00 8,861,275.00 6,887,795.00 5,808,654.00 2010 2009 2008 2007

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Balance Sheet (2007-2011) 2011 Asset Non-Current Assets Property Plant & Equipment Long Term Investment in associated company Long Term Deposits & Prepayments Current Assets Stores, Spare Parts & Loose Tools Stock In Trade Trades Debt 9,297,292.00 Advance Deposit & Other Receivable Short Term Investment Cash & Banks Balances Total Current Assets Total Assets 1,459,703.00 1,015,930.00 5,218,037.00 7,602,060.00 719,904.00 831,754.00 9,275,603.00 7,434,910.00 7,835,521.00 993,395.00 330,369.00 6,117,891.00 202,025.00 4,066,809.00 5,825,869.00 1,303,249.00 2,502,998.00 878,498.00 2010 2009 2008 2007

1,374,767.00 842,957.00

1,217,217.00 765,739.00

1,130,857.00 733,397.00 -

922,621.00 709,081.00 -

601,326.00 387,246.00 -

15,231.00

30,463.00

3,163.00 9,729.00 5,246,705.00 6,630.00 993,282.00 2,827.00 141,507.00 5,164.00 299,092.00 341,702.00

22,247,396.00 19,429,233.00 16,408,160.00 13,881,634.00 7,995,195.00 24,480,351.00 21,442,652.00 18,272,432.00 15,513,336.00 8,983,767.00

Equity & Liabilities Shares Capital & Reserve Authorized Capital 1,500,000.00 Issued Subscribed & Paid-up Capital Reserve Special Reserves Revenue Reserves
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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

1,500,000.00 576,000.00

1,500,000.00 576,000.00

750,000.00 480,000.00

750,000.00 400,000.00 18,004.00

691,200.00

27,407.00

17,043.00

34,097.00

53,272.00

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Un Appropriate Profit 10,827,601.00 8,643,534.00 Total Shareholder Equity Non-Current Liability Long Term Deposits Differed Income Tax Liability Total Non-Current Liabilities Current Liabilities Trades and Other Payable Provisions for Income Tax Total Current Liabilities Total Equity & Liability 11,546,208.00 9,236,577.00 6,472,171.00 7,082,268.00 5,002,577.00 5,535,849.00 3,036,293.00 3,454,297.00

209,316.00 111,000.00 320,316.00

178,308.00 110,000.00 288,908.00

159,538.00 92,000.00 251,538.00

121,137.00 14,000.00 135,137.00

113,821.00 13,000.00

126,821.00

12,073,287.00 11,554,057.00 10,730,633.00 9,813,929.00 540,540.00 363,110.00 207,993.00 28,421.00

5,296,183.00 106,466.00 5,402,649.00

12,613,827.00 11,917,167.00 10,938,636.00 9,842,350.00

24,480,315.00 21,442,652.00 18,272,432.00 15,513,336.00 8,983,767.00

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited PL Statement Horizontal Analysis (2007-2011) HA2011 HA2010 HA2009 HA2008 33.87% 34.18% 17.62% 20.41% Sales Tax Net Sales Cost of Good Sold Gross Profit Other Operating Income Operating Expenses Operating Profit Financing Cost Income on Bank Deposit & Short Term Investment Share of profit of associates Other charges Profit before Taxation Taxation Net Profit 45.73% 36.62% 28.65% 18.58%

Sales Less

32.13% 33.83% 16.19% 20.65% 32.45% 34.93% 16.00% 19.98% 25.38% 14.20% 19.79% 34.40% 51.19% 55.09% -5.84% 120.66% 27.13% 0.79% 28.01% 31.55% 32.56% 25.38% 11.83% 50.93% 113.42% 1003.29% -1.82% 15.54% 122.26% 8.58% 120.16% -1.60% 24.17% 40.65% 18.42% 59.70% 97.53% 13.22% 4.51% 16.61% -55.01% 22.81% 21.27% 34.91% 16.69% 39.22% 45.07% 44.91% 25.60% 52.81%

Net Sales:

2011 32.13%

2010 33.83%

2009 16.19%

2008 20.65%

Net Sale
600000000 500000000 400000000 300000000 200000000 100000000 0 2007 2008 2009 2010 2011

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Gross Profit:

2011 25.38% 2010 14.20% 2009 19.79% 2008 34.40%

Gross Profit
5000000 4000000 3000000 2000000 1000000 0 2007 2008 2009 2010 2011

Profit before Taxation:

2011 24.17% 2010 13.22% 2009 21.27% 2008 44.91%

Profit Before Taxation

8000000 6000000 4000000 2000000 0 2007 2008 2009 2010 2011

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Net Profit:

2011 18.42% 2010 16.61% 2009 16.69% 2008 52.81%

Net Income
5000000 4000000 3000000 2000000 1000000 0 2007 2008 2009 2010 2011

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited PL Statement Vertical Analysis (2007-2011) VA2011 VA2010 VA2009 VA2008 VA2007 100.00 100.00 100.00 100.00 100.00 % % % % % Sales Tax Net Sales Cost of Good Sold Gross Profit Other Operating Income Operating Expenses Operating Profit Financing Cost Income on Bank Deposit & Short Term Investment Share of profit of associates Other charges Profit before Taxation Taxation Net Profit 13.89% 86.11% 82.40% 3.71% 1.56% 0.48% 4.79% 0.54% 0.76% 0.07% 0.34% 4.74% 1.39% 3.35% 12.76% 87.24% 83.28% 3.96% 1.38% 0.51% 4.83% 0.34% 1.03% 0.04% 0.47% 5.11% 1.32% 3.79% 12.53% 87.47% 82.82% 4.66% 1.19% 0.67% 5.17% 0.04% 1.20% 0.04% 0.32% 6.05% 1.69% 4.36% 11.45% 88.55% 83.97% 4.57% 1.49% 0.62% 5.44% 0.00% 0.64% 0.10% 0.30% 5.87% 1.48% 4.39% 11.63% 88.37% 84.27% 4.09% 0.81% 0.57% 4.34% 0.00% 0.70% 0.08% 0.25% 4.88% 1.42% 3.46%

Sales Less

Net Sales:
2011 86.11% 2010 87.24% 2009 87.47% 2008 88.55% 2007 88.37%

Net Sales
89 88 87 86 85 84 2007 2008 2009 2010 2011

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Gross Profit:

2011 3.71% 2010 3.96% 2009 4.66% 20008 4.57% 2007 4.09%

Gross Profit
5 4 3 2 1 0 2007 2008 2009 2010 2011

Net Income:
2011 3.35% 2010 3.79% 2009 4.36% 2008 4.39% 2007 3.46%

Net Income
5 4 3 2 1 0 2007 2008 2009 2010 2011

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited

Pl Statement Vertical Interpretation: Net Sales are continuously getting down because of increasing in sales tax. Gross profit margin of 2011 decrease as compared to 2010 due to decrease in sales growth and increase in sales tax. Net income shows decrease due increase in financing cost, taxation and decrease in income and bank deposit

46

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Balance Sheet Horizontal Analysis (2007-2011) HA2011 HA2010 HA2009 HA2008 Asset Non-Current Assets Property Plant & Equipment Long Term Investment in associated company Long Term Deposits & Prepayments Current Assets Stores, Spare Parts & Loose Tools Stock In Trade Trades Debt Advance Deposit & Other Receivable Short Term Investment Cash & Banks Balances Total Current Assets Total Assets Equity & Liabilities Shares Capital & Reserve Authorized Capital Issued Subscribed & Paid-up Capital Reserve Special Reserves Revenue Reserves Un Aspirate Profit Total Shareholder Equity Non-Current Liability Long Term Deposits Deferred Income Tax Liability Total Non-Current Liabilities Current Liabilities Trades and Other Payable Provisions for Income Tax Total Current Liabilities Total Equity & Liability
47

12.94% 10.08% -50.00%

7.64% 4.41% 0.00%

22.57% 3.43% 0.00%

53.43% 83.11% 0.00%

46.74% 134.52% 428.22% 601.93% 22.30% -2.98% 102.76% -27.53% 22.14% 0.00% -43.74% 14.50% 14.17%

-45.26% 63.26% -52.69% -12.47% 34.50% 132.76% -23.78% 48.35% - 63.53% 100.00% 24.76% 21.53% 50.43% 18.41% 18.20% 73.62% 17.35% 17.79% 72.68%

0.00% 20.00% 60.81% 25.27% 25.01% 17.39% 0.91% 10.87%

0.00% 100.00% 0.00% 20.00% -50.02% 33.55% 30.42%

0.00% 20.00%

-35.99% 195.89% 29.38% 27.93% 64.76% 60.26% 6.43% 7.69% 6.56%

11.77% 31.70% 19.57% 557.14% 14.86% 86.14%

4.49% 48.86% 5.85% 14.17%

7.67% 9.34% 74.58% 631.83% 8.95% 11.14% 17.35% 17.79%

85.30% -73.31% 82.18% 72.68%

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Non-Current Assets:

2011 -26.98% 2010 12.05% 2009 26% 2008 136.54%

Non Current Assets

2500000 2000000 1500000 1000000 500000 0 2007 2008 2009 2010 2011

Current Assets:
2011 14.50% 2010 18.41% 2008 18.20% 2007 73.62%

Current Assest
25,000,000.00 20,000,000.00 15,000,000.00 10,000,000.00 5,000,000.00 2007 2008 2009 2010 2011

48

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Liabilities:

2011 16.72% 2010 23.81% 2008 97.28% 2007 88.74%

Laibilities
15,000,000.00 10,000,000.00 5,000,000.00 2007 2008 2009 2010 2011

Shareholder Equity:
2011 25.01% 2010 30.42% 2008 27.93% 2007 60.26%

Shareholder Equity
12,000,000.00 10,000,000.00 8,000,000.00 6,000,000.00 4,000,000.00 2,000,000.00 2007 2008 2009 2010 2011

49

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited

Interpretation: Current assets increasing 2010 to 2011 due to increase inventory, trade debt and advance deposit Non-current assets same as previous years. Shareholder equity increased due to increase in unappropriate profit and issued subscribes and paid up capital. Liabilities getting decrease year by year thats a good sign for organization, this decreases happened due to trade and other payables.

50

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Balance Sheet Vertical Analysis (2007-2011)

VA2011 Asset Non-Current Assets Property Plant & Equipment Long Term Investment in associated company Long Term Deposits & Prepayments Current Assets Stores, Spare Parts & Loose Tools Stock In Trade Trades Debt Advance Deposit & Other Receivable Short Term Investment Cash & Banks Balances Total Current Assets Total Assets Equity & Liabilities Shares Capital & Reserve Authorized Capital Issued Subscribed & Paid-up Capital Reserve Special Reserves Revenue Reserves Un Appropriate Profit Total Shareholder Equity Non-Current Liability Long Term Deposits Deferred Income Tax Liability Total Non-Current Liabilities Current Liabilities Trades and Other Payable Provisions for Income Tax Total Current Liabilities Total Equity & Liability
51

VA2010

VA2009

VA2008

VA2007

5.62% 3.44% 0.06%

5.68% 3.57% 0.14%

6.19% 4.01% 0.00%

5.95% 4.57% 0.00%

6.69% 4.31% 0.00%

0.04% 0.03% 0.02% 0.03% 0.04% 21.43% 4.63% 0.77% 1.93% 3.80% 37.98% 35.45% 42.88% 37.55% 27.86% 5.96% 3.36% 5.44% 8.40% 9.78% 4.15% 3.88% 0.00% 2.13% 2.25% 21.32% 43.26% 40.69% 39.44% 45.27% 90.88% 90.61% 89.80% 89.48% 89.00% 100.00% 100.00% 100.00% 100.00% 100.00%

6.13% 2.82% 0.11% 0.00% 44.23% 47.17% 0.86% 0.45% 1.31%

7.00% 2.69% 0.08% 0.00% 40.31% 43.08% 0.83% 0.51% 1.35%

8.21% 3.15% 0.19% 0.00% 35.42% 38.76% 0.87% 0.50% 1.38%

4.83% 3.09% 0.34% 0.00% 32.25% 35.68% 0.78% 0.09% 0.87%

8.35% 4.45% 0.20% 0.00% 33.80% 38.45% 1.27% 0.14% 1.41%

49.32% 53.88% 58.73% 63.26% 58.95% 2.21% 1.69% 1.14% 0.18% 1.19% 51.53% 55.58% 59.86% 63.44% 60.14% 100.00% 100.00% 100.00% 100.00% 100.00%

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Non-Current Assets:

2011 9.12% 2010 9.319% 2009 10.02% 20008 10.52% 2007 11%

Non Current Assets

12 10 8 6 4 2 0 2007 2008 2009 2010 2011

Current Assets:
2011 2010 2009 2008 2007

90.88%

90.61%

89.80%

89.48%

89.00%

Current Assest
91 90.5 90 89.5 89 88.5 88 2007 2008 2009 2010 2011

52

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Liabilities:

2011

2010

2009

2008

2007

52.84%

56.93%

61.24%

64.31%

61.55%

Laibilities
70 60 50 40 30 20 10 0 2007 2008 2009 2010 2011

Shareholder Equity:
2011 2010 2009 2008 2007

47.17%

43.08%

38.76%

35.68%

38.45%

Shareholder Equity
50 40 30 20 10 0 2007 2008 2009 2010 2011

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited RATIO ANALYSIS 1. 2. 3. 4. 5. 6. Liquidity Ratio Operating Ratio Capital Structure Solvency Ratio Return on Investment Profitability Ratio Leverages Ratio

1-Liquidity Ratio: Liquidity ratios tell us about a company ability to meet short term financial obligations such as debt payment, payroll, and account payable A. Current Ratio B. Acid Test Ratio C. Working Capital A. Current Ratio: Measure company current assets against its current liabilities Formula: Current Ratio = Current Assets/Current Liability 2011 1.763 Graph: Current Ratio
2 1.5 Ratio 1 0.5 0 2006 2007 2008 2009 Year 2010 2011 2012

2010 1.63

2009 1.5

2008 1.41

2007 1.478

Interpretation: It shows the company ability to pay it short term liability. From 2007 to 2011, this ratio is going upward trend, so this shows that company is in a good position to pay its short term liability.

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited B. Acid Test Ratio: Measures a company ability to meet its current obligations quickly. Formula: Quick Ratio = Current Asset-Inventory/Current Liability 2011 1.3477 2010 1.547 2009 1.487 2008 1.38 2007 1.42

Graph: Acid Test Ratio

1.6 1.55 1.5 1.45 1.4 1.35 1.3 2006

Ratio

2007

2008

2009 Year

2010

2011

2012

Interpretation: The acid test ratio of company has decreased in year 2011 as compared to year 2010. The trend of the company in its acid test ratio shows that company has a sense of maintaining good and adequate funds for payment of short term obligation. C. Working Capital: A measure of both a company's efficiency and its short-term financial health Formula = Current Asset- Current Liabilities 2011 2010 2009 2008 2007 9633569 7512066 5469534 4039284 2592546

55

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Graph: Working Capital

15000000 Ratio 10000000 5000000 0 2006

2007

2008

2009 Year

2010

2011

2012

Interpretation: Working capital of company has a trend of increasing from a trend 2007 to 2011. This is a good sign, asset of a company increasing day by day over liability. 2- Operating Ratio/Activity Ratio: Operating Ratios help us to assess a companys level of efficiency. A. B. C. D. E. F. Average Collection Period: Inventory Turnover Ratio Average Payment Period: Total Asset Turnover Working Capital Turnover Day to Sell Inventory

A. Average Collection Period: The approximate amount of time that it takes for a business to receive payments owed, in terms of receivables, from its customers and clients Formula: Average Account Receivable/ Sale/360 2011 31.02 2010 34.83 2009 46.23 2008 35.36 2007 18.29

56

Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Graph: Average Collection Period (Days)
50 40 30 Ratio 20 10 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: This ratio has decreased constantly from 2009 to 2011. This indicates that management of company is in action to reduce the collection period. B. Inventory Turnover Ratio: A ratio showing how many times a company's inventory is sold and replaced over a period Formula: Cost of Goods Sold/ Average Inventory 2011 33.55 Graph: Invntory Turnover Ratio (Times)
300 Ratio 200 100 0 2006

2010 139.28

2009 266.77

2008 157.6

2007 202.37

2007

2008

2009 Year

2010

2011

2012

Interpretation: Company inventory turnover ratio has decreased in 2010 and 2011. This indicates that company has a problem; the management of company should take action.

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited C. Average Payment Period: The number of days a company takes to pay off credit purchases Formula: Average Account Payable/ CGS/365 2011 41 2010 51 2009 64 2008 54 2007 45

Graph: Average Payment Period (Times)

80 60

Ratio

40 20 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: Average payment period show decreasing trend from 2009 to 2011. Reason behind this decreases in account payable as compare to cost of goods sold. D. Total Asset Turnover: The amount of sales generated for every dollar's worth of assets Formula: Sales/ Average Total Assets 2011 4.468 Graph: Total Asset Turn Over (Times)
6 4 2 0 2006 Ratio

2010 3.861

2009 3.38

2008 3.432

2007 4.91

2007

2008

2009 Year

2010

2011

2012

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Interpretation: Total asset turnover ratio has similar trend, but in 2011 turnover increases due to increase in sale. E. Working Capital Turn over: A measurement comparing the depletion of working capital to the generation of sales over a given period. This provides some useful information as to how effectively a company is using its working capital to generate sales Formula = 2011 12.76 Graph: Working Capital Turnover
20 15 Ratio 10 5 0 2006 2007 2008 2009 Year 2010 2011 2012

Sales/Average Working Capital 2010 12.75 2009 13.011 2008 16.05 2007 17.022

Interpretation: It tells us about the use of working capital, working capital turnover decreases year by year. This is not a good sign. F. Day to Sell Inventory: A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory (including goods that are work in progress, if applicable) into sales Formula: Average Inventory/ Cost of Sale/365 2011 18.29 2010 4.58 2009 0.88 2008 2.162 2007 2.964

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Graph:

Day to Sell Inventory

20 15 Ratio 10 5 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: It tell us how often the company places an order for inventory, when we compare 2010 with 2011, we found that company place more order. 3-Capital Structure Solvency Ratio: Capital Structure Solvency Ratio used to determine the relationship between a companys debt and equity as well as the comparative proportions of different types of stock. It also addresses a companys ability to remain solvent A. B. C. D. Total Debt to Equity Ratio Long term Debt to Equity Ratio Total Debt to Asset Ratio Time Interest Earned

A. Total Debt to Equity Ratio: A measure of a company's financial leverage. Formula: Total Liabilities/ Total Shareholder Equity 2011 1.12 2010 1.32 2009 1.58 2008 1.8 2007 1.6

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Graph: Total Debt to Equity Ratio
2 1.5 Ratio 1 0.5 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: Debt to equity ratio of a company decreases, which is good sign, amount of equity in business increases year to year. B. Long term Debt to Equity Ratio: Refers to money the company owes that it doesn't expect to pay off in the next year Formula: Long Term Liabilities/ Shareholder Equity 2011 0.02774 Graph: Long Term Debt to Equety Ratio
0.04 0.03 Ratio 0.02 0.01 0 2006 2007 2008 2009 Year 2010 2011 2012

2010 0.0312

2009 0.0355

2008 0.0244

2007 0.0367

Interpretation: From 2009 to 2011, long term debt to equity ratio shows decreasing trend means company is not obtaining the long term loan.

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited C. Total Debt to Asset Ratio: Indicates what proportion of the company's assets are being financed through debt Formula: Total Debt/ Total Asset 2011 2010 2009 2008 2007 52.83% 56.92% 61.20% 64.30% 61.54%

Graph: Total Debt to Asset Ratio

80 60 Ratio 40 20 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: Total debt to total assets ratio shows that company reduced the debt involvement and increases the equity in business. It is a good sign. D. Time Interest Earned: Measure a company's ability to meet its debt obligations Formula: EBIT/ Interest Expense 2011 9 2010 14 2009 126 2008 0 2007 0

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Graph: Time Intrest Earned Ratio
150 Ratio 100 50 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: Decrease in value due to increase in interest expense/financing cost. 4. Return on Investment: Measure used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investment A. Return on Asset B. Return Equity A. Return on Asset: How profitable a company is relative to its total assets Formula: Net Income/Average Total Assets 2011 2010 2009 2008 2007 18.53% 18.10% 18.24% 21.56% 19.24% Graph: Return on Asset
22 20 18 16 2006 Ratio

2007

2008

2009 Year

2010

2011

2012

Interpretation: Company maintains its ROA from 2009 to 2011 with little bit changes.

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited B. Return on Equity: Return on equity measures a corporations profitability by revealing how much profit a company generates with the money shareholders have invested Formula: Net Income/Average Shareholder Equity 2011 2010 2009 2008 2007 40.90% 44.10% 48.80% 58.70% 50.00% Graph:

Return on Equity
80 60 Ratio 40 20 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: Return on equity is showing decreasing trends, because company was not paying to its shareholder, company try to keep some earning in its resources. 5. Profitability Ratio: Used to assess a business's ability to generate earnings as compared to its expenses and other relevant costs incurred during a specific period of time A. Gross Profit Margin B. Net Profit Margin C. Operating Profit Margin A. Gross Profit Margin: A financial metric used to assess a firm's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold Formula: Sale Cost of Sale/ Sale 2011 4.31% 2010 5.00% 2009 5.32% 2008 5.16% 2007 4.63%

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Graph: Gross Profit Margin
6 Ratio 4 2 0 2006 2007 2008 2009 Year 2010 2011 2012

Interpretation: Gross profit margin decreases from prior years due to increasing of cost of goods sold. B. Net Profit Margin: Net profit divided by net revenues, often expressed as a percentage. This number is an indication of how effective a company is at cost control. Formula: Net Profit /Net Sale 2011 3.89% Graph: Net Profit Margin
6 5 4 3 2 1 0 2006

2010 4.34%

2009 4.98%

2008 4.96%

2007 3.92%

Ratio

2007

2008

2009 Year

2010

2011

2012

Interpretation: Net profit ratio shows decreasing trend from 2009 to 2011. The decreases in value are due to increases in operating expenses.

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited C. Operating Profit Margin: A ratio used to measure a company's pricing strategy and operating efficiency Formula: EBIT/Sale 2011 5.56% Graph: Operating Profit Mrgin
8 6 4 2 0 2006

2010 5.54%

2009 5.92%

2008 6.15%

2007 4.91%

Ratio

2007

2008

2009 Year

2010

2011

2012

Interpretation: Operating profit margin of company is showing up and down trend with slight margin. In 2011 Attock Petroleum Limited should maintain their operating profit margin. 6. Market Measures: B. Earning Per Share C. Price Earning Ratio D. Dividend Payout Ratio A. Earning Per Share: The portion of a company's profit allocated to each outstanding share of common stock Formula: EACS/Number of Share Outstanding
2011 61.58 2010 62.4 2009 53.51 2008 55.03 2007 43.22

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Graph:

Earining per Share

70 60 50 40 30 20 10 0 2006

Ratio

2007

2008

2009 Year

2010

2011

2012

Interpretation: EPS shows increasing trend from 2007 to 2010 year, but in year 2011 earning per share little bit decreases due to increase operating expenses, financing cost and current taxation. Earning per share previously reported at Rs. 62.40 in the financial statement for the year ended June 30, 2010 has been restated to Rs. 52.00 for 11520000 bonus share issued during year ended June 30 2011. C. Price Earning Ratio: A valuation ratio of a company's current share price compared to its per-share earnings Formula: Market Price Per Share/Earning Per Share
2011 6.75 2010 5.19 2009 5.94 2008 9.43 2007 13.92

Graph: Price Earing Ratio

15 Ratio 10 5 0 2006

2007

2008

2009 Year

2010

2011

2012

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad

[ANALYSIS OF FINANCIAL STAEMENT] Attock Petroleum Limited Interpretation: Here price earning ratio is 13.92 in 2007 while it is 6.75 in 2011 that keep on deceasing is a good sign.

Altman Z Score: Definition: The Z-score formula may be used to predict the probability that a firm will go into bankruptcy within two years. The Z score consists of 5 variables:

X1 = Working Capital/Total Assets X2 = Retained Earnings/Total Assets X3 = EBITDA/Total Assets X4 = Market Value of Equity/Total Liabilities X5 = Net Sales/Total Assets

Altman Z Score for Public Companies: The original model to calculate the Z score for public manufacturing companies is as follows. Z = 1.2*X1 + 1.4*X2 + 3.3*X3 + 0.6*X4 + 1.0*X5 When Z is 3.0 or more, the firm is most likely safe based on the financial data. However, be careful to double check as fraud, economic downturns and other factors could cause unexpected reversals. When Z is 2.7 to 3.0, the company is probably safe from bankruptcy, but this is in the grey area and caution should be taken. When Z is 1.8 to 2.7, the company is likely to be bankrupt within 2 years. This is the lower portion of the grey area and a dramatic turnaround of the company is needed. When Z is below 1.8, the company is highly likely to be bankrupt. If a company is generating lower than 1.8, serious studies must be performed to ensure the company can survive.

Attock Petroleum Limited: Altman Z score for year 2011 is 7.4; the probability of insolvency is low. The firm is most likely safe based on the financial data. . However, be careful to double check as fraud, economic downturns and other factors could cause unexpected reversals.

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Shaheed Zulfikar Ali Bhutto Institute of Science & Technology, Islamabad