Financial Managment

Topics: Generally Accepted Accounting Principles, Steel, Financial ratios Pages: 8 (2863 words) Published: June 22, 2013
This assignment was given for student doing Financial Management 1 (BBPW 3103). This report is based on an analysis of the financial performance of Two Malaysian Companies by using their financial statements for the year 2011. The global steel industry has continued to face a challenging period since 2011. Mainly due to the higher inputs costs and also increase in external environment. Thus, for this assignment I have chosen two leading companies in Malaysian steel industry. Namely: CCSC Steel Holdings BERHAD and Mycron Steel Berhad. These two companies are closely competing in Malaysian steel Industry. According to the Malaysian Iron and Steel Industry Federation (MISIF), the domestic steel industry has slightly fallen. Furthermore, an in depth analysis and evaluation of the above two companies would be made followed by a close comparison of those two companies performance based on my findings along with a justification of which company has done better in my view. This assignment consists 40% of our final course grade.

Companies Background
CCSC Steel Holdings BERHAD (CHB)
According to CCSC Steel Holdings BERHAD (CHB) official website, CSC Steel Holdings Berhad Formerly known as Ornasteel Holdings Berhad is a subsidiary of China Steel Corporation was incorporated in Malaysia on 20 January 2004. CSC is among the leaders of the Steel Industry of Malaysia. As stated in its official website, it is an ISO 9001: 2008 certified and is registered within BM TRADA Certificate Scheme. In addition to this 40% of the shares are owned by China Steel Corporation. As stated in CCSC Steel Holding Berhad (2011), CHB is an investment holding company which provides management services to its subsidiaries. Namely; CSC Steel SDN.BHD, CSC BIO COAL SDN.BHD, CSC CONSTANT MODE SDN.BHD and GROUP STEEL CORPORATION (M) SDN.BHD. In Contrast to this CSC has a products portfolio of hot rolled pickled and oiled steel, cold rolled steel, hot-dipped galvanized steel and pre-painted galvanized steel. According to Malaysian Iron and Steel Federation Industry (2013), CSC is the Malaysia’s largest cold rolled producer by production size. According to CHB’s Annual Report (2011), their mission is “To be a trustworthy and one of the best flat steel manufacturers in South East Asia.” And in order to achieve this vision the group strives to achieve the following mission objectives as stated in CHB’s Annual report (2011). * “To continuously improve quality and productivity.” * To constantly develop high value-added products and environmental-friendly products.” * “To continually pursue excellence in quality and service exceeding customers’ expectations.” * “To fulfill commitments to corporate social responsibility.” According to Malaysian Iron and steel industry federation (MISIF), (2013) CSC has is a registered member of MISIF with 600 employees and exporting products to more than fifteen countries, USA, Canada, Italy, West Germany, England, Brazil, Mexico, Saudi Arabia, UAE, Kuwait, China, Australia, new Zealand, Bangladesh, Taiwan, Thailand, Vietnam, Philippines, Indonesia are some of them. In addition to this, Along with heavy production and being market leader in cut throat competition CSC is also actively involved in CSR activities. They understand their social responsibility and continuously come up with various initiatives and investments in CSR activities. According to their annual report (2011), CHB is committed on CSR and corporate governance and they tend to take pride in CSR activities the Group organizes on a continuous basis. There first aim to create a strategic bio-economy industry for Malaysia was achieved with the launching CSC Bio-COAL SDN BHD, with an aim to produce bio-coal from oil palm. Mycron Steel BERHAD

According to Mycron Steel Berhad (MSB) ‘s official website (2013), MSB official commenced its operation in Malaysia under the companies Act 1965 as a public limited company. MSB is a holding company...
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