Accounting End Term Project Presentation
Transcript of Accounting End Term Project Presentation
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NESTLE MALAYSIA
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E stablished in Malaysia since 1912
Leading halal food manufacturer with over 300 halal products
E mploys over 4,000 people
RM3.1 billion turnover in 2005
Public-listed on Bursa Malaysia
7 factories and 6 sales office
NESTLE¶S CORPORATE PROFILE
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YEE LEE CORPORATION BERHAD / YLC
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Began its core business as an edible oil repacker in Malaysia in 1968
Involved in various sector such as manufacturing, marketing & distribution of fastmoving consumer products, plantation & eco-tourism.
Products include food, bottled water, oral care, household cleaners and industrial
products, several brands YL C listed on Bursa Malaysia in 1993
2280 shareholders
YEE LEE¶S CORPORATE PROFILE
YEE LEE¶S CORPORATE PROFILE
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Sunglow Detergent Powder
ung E u i In t nt oodle
Spritzer Di tilled Drin ing W ter ed E gle Coo ing Oil
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It¶s all aboutMONEY!
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F INANCIAL HIGHLIGTHS &ANALYSIS
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Can I earn money?
Profitability
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PROFITABILIT Y
` 2006 vs. 2005 ± Overview of BAT operating income` 20% growth in profit before taxation compared to 2005
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PROFITABILIT Y
` G ross profit rate indicates profitability
42% 41%
0%
10%
20%
30%
40%
50%
Gross proft rate
2006
2005
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Can BAT paying its debts as they come due?
L iquidity
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SHORT-TERM LIQUIDIT Y
` Short-term investment with original maturities of 3 months` Sufficient cash in hand and balances with licensed financial institutions` Inventories - low cost and net realisable value
0.9
2.1
0
0.5
1
1.5
2
2.5
Curren t R ti
2006
2005
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Will my money be ³safe´ in BAT?Credit Risk
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LO N -TERM CREDIT RISK (D ebt Rat )
` The lower the debt ratio the better ` Percentage of assets financed by debt has decreased tremendously 2 7 % as compared to
2005
53%
80%
0%
20%
40%
60%
80%
100%
Deb t R ti
2006
2005
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Is BAT worth to invest?
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INVESTI N
` E arning per share up to 21% over 2005
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Is BAT stable & reliable?
Stability
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STABILIT Y
` Revenue ± Modest growth trend` Net Profit ± 20% of satisfied recovery in 2006` CO G S ± G radually growth from 2002 to 2006
T r d A alysis
7
Y ar
R vN t Profit
OGS
Not : Usi g as as p riod
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STABILIT Y
` Revenue ± Modest growth trend` Net Profit ± 20% of satisfied recovery in 2006` CO G S ± G radually growth from 2002 to 2006
Pro f t afte r tax up 21 (excl uding non r ec urring i tem up to 8% )
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OTHERS
` Sales of goods has accelerated growth of 34% as compared to 2005
` Purchase of goods has significant decreased of 15% as compared to 2005
` L aunched productivity improvement programme ± ³Breakthrough´
Cost efficiency improvement by RM40m
Manpower productivity improvement up to 26%
On-time deliveries of 100%
Indirect spend savings 15%
World class product quality
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BRAND ACTIVITIES & PER F ORMANCE
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PALL MALL CO NTINUES TO GLOW
2006 RA Share: 7 .7 %
2005 RA Share: 7 .5%
No te : RA f igur es a r e on m on th by m on th bas is
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DUNHILL SHOWI NG MARKET SHARE GROWTH
2006 RA Share: 39.5%, up to 0.5% from 2005
Q4 RA Share: 40.4%
No te : RA f igur es a r e on m on th by m on th bas is
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KE NT STABLE MARKET SHARE
Stable market share at 0.9% despite market downtrading
Note: RA figures are on month by month basis
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NON-DRIVE BRA ND STABILISI NG
Market share stablilised
No te : RA f igur es a r e on m on th by m on th bas is
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F INANCIAL HIGHLIGTHS & ANALYSIS
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Important points Important PointsImportant points
Type of share:Common Stock Sales : 80.70 %
Profit:7.54Market value :142.65
Price$ :108.6P/E Ratio: 21.59
EPS :5.03Dividend :1.3 7 4
Y ield :1.265
Shares Out:1.603 .
Sales ank:46
Profits ank:40
ankin : 51
. Market Value:30
Symbol :
NSRGF.PK
47
07
.KL
NE
STLE
(M) BHD
Su estin point : Investing in nestle for long term
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www.themegallery.comCompany Logo
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E PS0
2
4
6
20052006
2.4 4.4
Inv estme n t r at io s
Current Ratio1.1
1.2
1.3
2005 2006
1.2
1.3Liquidi ty Rat io
Inc r eas ing In Curr e n t Rat io : c o m p a n y able to p ay sh or t te r m d ebts
long term debtto
Shareholder 18%
19%
20%
20052006
20%
19%
Gea ring R at io
Decreasing in G earing Ratio : c o m p a n y able to p ay long te r m d ebts
dividend yeild3.20%
3.40%
3.60%
3.80%
4.00%
2005 2006
3.50%
4.00%
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Good Stable situationGood Stable situation :Able to payDebts , reasonable cash on hand
Food &Food &drinking drinking
Metal Metal industry industry
Nestle is good for long term investing althoughIt is not reasonable invest whole money in 1
type of basket(here stock)
So
But for NestleNestle : LOW Risk :LOW Risk :Less than 1 beta: low related to market
change/ no strikeno bonds in stock basket
Also external effectsEconomic Stability in Malaysia
Government policy to control Interest Rate :3.7
no sanctions against country No conflict/war no country risk Quite safe
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0%
1%
2%
2005 2006
1% 1%
Net income as percentage of net sales
0%
2%
4%
2005 2006
3%
4%
2005 2006
Steady net income for both 2006 & 2005
Indicates growth trend in return on equity
PROFITABILIT YPROFITABILIT Y
Return on equity
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LO NG-TERM CREDIT RISKLO NG-TERM CREDIT RISK
50%
60%
7 0%
20052006
60%60%
2005 2006Debt Ratio
Demonstrate same steady debt ratio for both year 2006 & 2005
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SHORT-TERM LIQUIDIT YSHORT-TERM LIQUIDIT Y
Current Ratio
Modest growth of enterprise liquidity in 2006 in paying its debt
0.8
0.85
0.9
0.95
1
20052006
0.860.9
2005 2006
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1.0%
3.0%
5.0%
20052006
3.5% 4%
2005 2006
INVESTME NTINVESTME NT
Dividend Y ield
Increased of dividend yield as positive indication for investment
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0%
20%
40%
60%
80%
100%
120%
140%
160%
2002 2003 2004 2005 2006
100%
106%
13 7 % 140%
160%
Dividend PaidRevenueNet Profit
TRE ND ANAL YSISTRE ND ANAL YSIS
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RE COMME NDATIONS:RE COMME NDATIONS:
NE STLE
BRITISH AME RICANTOBACCO
YEE LEE
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7 8 6994
114 113 125 132
232
265 27 4
208
252 262 27 1
3 3 6 7 5 7 7 .50
50
100
150
200
250
300
2002 2003 2004 2005 2006 200 7 2008
NE ST LE
BA TYEELEE
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0
2
4
6
8
10
12
2002 2003 2004 2005 2006
NE ST LE
BATYEELEE
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0
10
20
30
40
50
60
2002 2003 2004 2005 2006
NE ST LE
BA TYEELEE
www.themegallery.comCompany Logo
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