Financial Analysis for Managers

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Assignment Acknowledgement Sheet

Module Title: Module Instructor : Semester: Programme: Module Leader:

ECM05EKM – Financial Analysis for Managers Samatha Ravu Summer 2012 MBA-IT Samatha Ravu

Intended Module Learning Outcomes

Name of Student
Due Date: Submitted on: Submitted to: Signature:

Name and ID Fatima Hassan Al.Lawati PG11f1189 12 September 2012 through Moodle 12 September 2012 Through Moodle

Signature

1

Table of Contents
1.0 2.0 Introduction ........................................................................................................ 3 Part 1 ..................................................................................................................... 3

2.1 The Chosen Companies in brief........................................................................... 3 2.2 Part 1: Task 1: Ratios Calculation ....................................................................... 4 2.2.0 Liquidity Ratios ............................................................................................... 5 2.2.1 Profitability Ratios .......................................................................................... 6 2.2.2 Efficiency Ratios ............................................................................................. 8 2.2.3 Capital Structure Ratios .............................................................................. 10 2.2.4 Marketing Ratios .......................................................................................... 11 2.3 Part 1: Task 2: Ratios Analysis with Literature Review .................................. 12 2.4 Part 1: Task 3: Non-Financial Measures Analysis ............................................ 22 3.0 Part 2: Task 1 .................................................................................................... 25

3.1 Net Present Value Calculation ............................................................................ 25 3.2 Internal Rate of Return Calculation ................................................................... 26 3.3 Summary of NPV and IRR calculation for Machine A and B .......................... 29 3.4 Analysis and Recommendations for Investment ............................................. 29 3.4.1 Investment appraisal preferred method .................................................... 30 3.4.2 Recommend Investment proposal .............................................................. 31 4.0 Part 2: Task 2 .................................................................................................... 32

4.1 Analysis of contribution per unit ........................................................................ 32 4.2 Total contribution and profits for different sales mixtures ............................ 34 4.3 Most profitable sales mixture ............................................................................. 35 4.4 Analysis of different costs and impact on profits ............................................ 37 5.0 References............................................................................................................. 39

2

1.0 Introduction
This report is in response to the assignment of Financial Analysis for Managers module of MBA-IT program for the summer 2012 semester. The report contains two parts. The first part evaluates the performance of two companies in Oman using financial analytical tools and non-financial measures. The second part, analyses different patterns of cost behavior and applies cost-volume-profit analysis to sales mixture scenarios given in the assignment. Investment appraisal techniques are presented and utilized to give decision on the best investment from a given scenarios in the assignment.

2.0 Part 1
Part 1 of the assignment aims at analyzing the financial data of two companies from the same industry to evaluate the performance and recommend best option for investment purpose. Oman Fisheries CO. SAOG and Dhofar...
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