Sime Darby Group
TABLE OF CONTENTS
1. Executive Summary . .. 2
2. Company Overview . .... 3
3. Non-financial Analysis . .. 5
3.1 Market and Industry Overview 6
3.2 Corporate Governance . ... 6
3.3 Board of Directors . 6
3.4 Internal Control and Risk Management .... . .. 6
3.5 Environmental, Safety and Health .. . 7
3.6 Corporate Social Responsibility ... 7
4. Financial Analysis . ... . 8
4.1 Profitability Ratios
4.1.1 Net Profit Margin .. 8
4.1.2 Return on Assets (ROA) . 9
4.1.3 Return on Equity (ROE) . . ... 13
4.2 Activity/Working Capital Ratios
4.2.1 Average Collection Period Ratio.. .... 14
4.2.2 Inventory Turnover Ratio . 15
4.3 Debt/Financial Leverage Ratios
4.3.1 Debt Performance Ratio . .. 16
4.3.2 Interest Cover Ratio . 17
4.4 Liquidity Ratios
4.4.1 Current Ratio .. 18
4.4.2 Quick (Acid Test) Ratio . 19
4.5 Market Related Ratios
4.5.1 Earnings per Share (EPS) 20
4.5.2 Earnings Yield Ratio 21
4.5.3 Price-earning (P/E) Ratio 22
4.5.4 Dividend Yield Ratio 23
4.5.5 Dividend Coverage Ratio . 24
4.5.6 Dividend Payout Ratio 25
4.6 Segment Analysis
4.6.1 Revenue and EBIT
4.6.2 EBIT Margin
4.6.3 Return of Assets (ROA)
4.6.4 Debt Performance Ratio
5. Conclusions and Recommendations .. 26
6. References .... .. 2
7. Appendix
1.0 Executive Summary
Sime Darby Group is one of the largest and oldest conglomerates in Asia-Pacific. An analysis was done to identify the potential of the company in the perspective of an investor. The analysis was divided into two sections which are non-financial and financial aspects of the company.
In the non-financial section, we have included the following:
a. A company overview of Sime Darby which provides details on its diversity of business. In addition,
1. Executive Summary . .. 2
2. Company Overview . .... 3
3. Non-financial Analysis . .. 5
3.1 Market and Industry Overview 6
3.2 Corporate Governance . ... 6
3.3 Board of Directors . 6
3.4 Internal Control and Risk Management .... . .. 6
3.5 Environmental, Safety and Health .. . 7
3.6 Corporate Social Responsibility ... 7
4. Financial Analysis . ... . 8
4.1 Profitability Ratios
4.1.1 Net Profit Margin .. 8
4.1.2 Return on Assets (ROA) . 9
4.1.3 Return on Equity (ROE) . . ... 13
4.2 Activity/Working Capital Ratios
4.2.1 Average Collection Period Ratio.. .... 14
4.2.2 Inventory Turnover Ratio . 15
4.3 Debt/Financial Leverage Ratios
4.3.1 Debt Performance Ratio . .. 16
4.3.2 Interest Cover Ratio . 17
4.4 Liquidity Ratios
4.4.1 Current Ratio .. 18
4.4.2 Quick (Acid Test) Ratio . 19
4.5 Market Related Ratios
4.5.1 Earnings per Share (EPS) 20
4.5.2 Earnings Yield Ratio 21
4.5.3 Price-earning (P/E) Ratio 22
4.5.4 Dividend Yield Ratio 23
4.5.5 Dividend Coverage Ratio . 24
4.5.6 Dividend Payout Ratio 25
4.6 Segment Analysis
4.6.1 Revenue and EBIT
4.6.2 EBIT Margin
4.6.3 Return of Assets (ROA)
4.6.4 Debt Performance Ratio
5. Conclusions and Recommendations .. 26
6. References .... .. 2
7. Appendix
1.0 Executive Summary
Sime Darby Group is one of the largest and oldest conglomerates in Asia-Pacific. An analysis was done to identify the potential of the company in the perspective of an investor. The analysis was divided into two sections which are non-financial and financial aspects of the company.
In the non-financial section, we have included the following:
a. A company overview of Sime Darby which provides details on its diversity of business. In addition,
References: In the financial section, Sime Darby 's performance was analyzed by the following approach: a. Key financial ratio such as Profitability, Working Capital, Debt, Liquidity and Market ratios was used on its Annual Reports for 4 years (2002-2005).