Professional Documents
Culture Documents
The second part is the project part, which is divided into eight parts.
In Part I, the tasks those were assigned by company supervisor is discussed in short and
the experience that has been gathered is also discussed. Part two is the main project part,
which is the Financial Analysis. First of all, analysis of Common size income statement
and balance sheet is done and then ratio analysis and bankruptcy prediction is done. The
balance sheet and income statement of 1994-99, Common size Income Statement,
Balance Sheet, ratios and forecasted Income Statement and Balance Sheet are in
presented in Appendix I. The financial analysis explains BATB’s current and historical
performance in finance area. Some suggestions are also given to BATB so that BATB
can retain its leadership in the market. In the third part, ‘The Impact of CDS in the Share
Management of BATB’ is discussed but here the qualitative analysis is done because of
lack of information. In fourth part ‘Comparison of Standards of Business Conduct
between BAT and BATB’ is done and recommendation are made. Fifth part includes
‘Advertising and
Promotion Policy’. This is the updated version of Advertising and Promotion Policy
1988. In this Policy, a few standards of Business Conduct and Marketing Code of
Conduct of BATB and Section 294(B), Bangladesh Penal Code was incorporated. Sixth
part is about ‘Records Management’. This is a training module for the managers for
implementing Records Management thorough out BATB. Two projects were submitted
to Social Responsibility Managers as per his instruction- ‘Railway Station Waiting Room
Beautification’ and ‘Returning the Light of the Eyes of the Cataract Patients’. In the
Eighth part Checklist on Statutory requirements of DSE, CSE and SEC and checklist on
Companies ACT 1994 are presented which were prepared to ensure compliance with
those requirements and laws.
Company Overview
British American Tobacco Bangladesh (BATB) is one of the pioneer cigarette
manufacturers in the world. The company was formed at the turn of the 20th century
with the objective of establishing a worldwide business. Today
British American Tobacco sells the leading brands in over 30 markets
covering 102 countries, has more than 200 brands worldwide, employs
more
than 55,000 people and produces some 2 billion cigarettes every day.
Vision:
To extend our leadership through world-class performance.
Mission:
? Double the net revenue by 2005
? Growing our share of the total tobacco market
? Dominating key identified segments
The Board meets at least 6 times a year and makes decisions on key
matters.
The Board is responsible for the overall system of internal control for
the
company and for reviewing the effectiveness of these controls. The
system is
designed to manage risks that may impede the achievement of the
company’s
business objectives rather than to eliminate these risks.
The Board Committees are namely – Audit Committee & Board Compensation
Committee, each of its own terms of reference play an important role in
executing the responsibility of the Board.
Appendix-II Figure 1: Board of Directors
Appendix-II Figure 2: Executive Committee
History of British American Tobacco Bangladesh
British American Tobacco Bangladesh Company Limited is a subsidiary of
British American Tobacco and is one of the 68 countries in which BAT
has
manufacturing plants. It is one of the oldest and largest multinational
companies operating in Bangladesh.
The sales Depot was separated from the cigarettes godown and shifted in
1954
to Omar Sons Building, Motijheel-now known as Red Cross Chamber. About
that
time there were about 2 or 3 buildings in whole of Motijheel Commercial
Area. In1965, the Sales Depot was upgraded to the status of the Branch
Office and was shifted to ALICO Building, 18-20 Motijheel Commercial
Area,
Dhaka. The building (after the emergence of Bangladesh became the Head
Office Of Bangladesh Tobacco Company Limited) was occupied by BATB till
1992.
The second factory was set up in 1965, 30th June in Dhaka on a16 acres
of
land on a 90 years lease that was purchased from the Cantonment Board.
Following the 1965 war with India, the import of `Tendu, leaves which
were
used as wrappers for hand made biris, was banned. This gave rise to
huge
demand for paper wrapped machine-made-cigarettes and a large number of
cigarette Factories-in all about 19- were set up. Initially Capstan,
Bristol, Scissors, Star were manufactured in Dhaka Factory and the
Chittagong Factory produced Star and Scissors. The monthly sale of
cigarettes in East Pakistan in the 1970’s reached 1200 million while
the
combined production capacity of the two Factories at Dhaka &
Chittagong,
was only 900 million.
The East Pakistan became embroiled in the struggle for achieving full
Provincial Autonomy in 1970 and this eventually lead to the civil war
and
emergence of independent Bangladesh on 16th in December, 1971. After
Bangladesh came into being , all properties of Pakistan Tobacco Company
Limited (PTC) were declared as “ abandoned property” because the owners
were
citizens of a state which was engaged in war with Bangladesh after 25th
March, 1971 and the ownership of the Company vested in the Government
under
the Bangladesh Abandoned Property (Control Management and Disposal)
Order,
1972 (know as P. O. 16).
The new infant Government allowed the local and the expatriate British
Management of the former PTC to continue to operate the Company and the
reconstitution process was set in motion in 1972 by BAT.
All these except the foreign currency used to come from West Pakistan.
BTC
after exhaustion of the pre-independence stocks of tobacco and the
Wrapping
materials, ran hand to mouth for a few years.
As BTC has always been a part of BAT and over the years BTC has proved
to be
the perfect representative of BAT by manufacturing and marketing
quality
brands of cigarettes which met the standards of BAT. In recognition to
its
commitment towards BAT and the important role it played on BAT group,
BTC
was later named as British American Tobacco Bangladesh Company Limited
(BATB).
Structure of BATB
Leaf Operations
Mission:
To exceed costomet expectations by providing quaity tobacco at
competiotive
price.
The leaf season begins in the month of July. At this time tobacco
seedbeds
are prepared to generate the seed that will be distributed to the
farmers
for cultivation. Plantation in the registered lands occurs during
October
and November. BAT provides the necessary fertilizer, pesticides, and
other
loans to ensure proper growth for the crop. Farmers use their own
irrigation
and plowing methodology to prepare the land. Harvesting and curing
begins at
the end of January and continues till March. Almost 100% of raw tobacco
is
'flue' cured.
The buying process begins in mid-February and continues till the end of
May.
The farmers bring in their cured tobacco in the form of bales to the
buying
courts in the depots. The tobacco is graded according to set criteria
and
purchased at these sites. All relevant information is marked on the
bales
and stored at the depots till shipment to the GLT.
Buying courts are located at the depots. The farmers bring their
tobacco to
these sites in the form of bales on a specific day and time. At the
buying
courts the bales are graded, priced and weighed. After the tobacco is
bought
and graded it is stored in the depot godowns; each bale identified with
its
grade, weight, and price. These bales are stored in the depots and
moved to
the GLT when needed for processing.
Tobacco processing
The Green Leaf Threshing Plant in Kushtia is used to treat the raw
tobacco
and convert it to a form suitable for use in cigarette production. It
is a
seasonal factory operating for six months of the year, on two shifts
per
day. The remainder of the year is used to clean the machinery and make
modifications as necessary.
Each tobacco leaf that is processed at the GLT is separated into four
components- tip, lamina, stem, and by product. At the beginning of the
process flow, tips of the tobacco leaves are cut off by a calibrated
cutter.
The leaves are then passed through the sand reel where foreign
materials and
dirt are separated. The tobacco leaves are then proceeds to the
threshing
line to separate the lamina from the stem by hitting the leaves. The
separated lamina are then dried and the re-dried lamina is then packed
at a
temperature of about 43 Degrees Centigrade with approximately 12%
moisture
content for storage. The separated stem, meanwhile, moves to the stem
dryer
where it is re-dried for storage purposes and then sent to the stem
packer.
The moisture content level of the stem is brought to around 12% at the
time
of storage. By-products are sold to the outside contractors.
Future challenges:
The cigarette market is growing and in order to sustain the current
pricing
of the products, more and more imported tobacco grades are being
substituted
by locally grown tobacco grades. This means that Leaf Department has to
manage the future challenges to sustain competitive advantage and in
order
to do that following program have been identified:
• Improvement of barn capacity. This means that barn efficiency &
utilization has to be increased through technological innovation but
without
increasing the cost of manufacturing Barn.
• Green Leaf threshing plant is currently over manned. Employee
productivity
has to be improved so that tobacco-processing cost becomes competitive.
• Striving for continuous quality improvement is essential in order to
substitute the imported grade by local grades for the premium brands.
• Leaf department has to ensure that the buying cost of the tobacco
should
not increase compare to the current buying pricing policy. But this
does not
mean that the farmer will lose any money in the overall process. In
order to
achieve that Leaf has to ensure that the overall growing yield has to
increase significantly.
Manufacturing
Mission
We delight our customers with superior quality product through
flexible
operations
The prized tobacco from the GLT comes to the DF for further processing
according to need. The first stage of production is known as PMD. The
Primary Manufacturing Department: The primary manufacturing department
(PMD)
is responsible for further conditioning the domestic and important
tobacco
to make it ready for production. The tobacco passes through a set of
integrated and regulated machinery whose purpose is to blend the
different
'packing grades' in specified proportions, convert the bales into 'rag'
suitable for use in cigarettes, and bring tobacco to a uniform
temperature
and moisture.
Threshed lamina and stem are not of the size suitable for cigarette
preparation. To make them suitable for cigarette making the following
operation have to be performed.
From the final product bin it goes to the SMD( Secondary Manufacturing
Division) for further manufacturing.
Shipping
The finished cigarette stock is brought in from the holding room at the
Secondary Manufacturing Department and kept at the shipping prior to
delivery. The godown has a capacity of 260 million cigarettes. Trucks
belong
to outside contractors arrive daily to deliver the stock to the various
Regional Trade Marketing Offices (RTMOs) around the country. The
marketing
department issues a daily shipping program specifying the stock that
needs
to be allocated. This information is processed by software to generate
a
truck allocation scheme. Trucks going to Dhaka carry 2 million
cigarettes
per trip and those going outside Dhaka carry 3 million cigarettes per
trip.
Vat documents are sent along with the trucks.
TM&D Mission:
To reach our target consumers in the most efficient and effective way
by
becoming the benchmark supplier to the trade within strategic channels
in
every market place where we do business.
Regional Go-down: There are five regional go-downs through out the
country
to fill every regional demand just at the time of need, and to overcome
various uncertainties related to physical distribution of products,
every
regional go-down is directly controlled by separate Regional Manager to
face
the regional physical distribution challenge.
Internal Carrying Agent: They are like carrying agent but carry small
volume
of products. Normally they are local truck owners. They carry products
from,
regional godowns to distributor warehouses. They also take al the
responsibilities and risk engaged in physical movement of products.
Delivery Van: All the delivery vans are owned by the dealers to assure
the
supply of cigarette on the door of wholesalers, cash & carries and
retailers
just according to their demand. There are two types of delivery vans.
One is
Scooter van and another is Rickshaw van.
Cash & Carry: They are businessmen who sell cigarette directly to
consumers
and at the same time they sell cigarette to the retailers.
The British American Tobacco Bangladesh has classified all the retail
outlets into three categories, these are - Convenience, Grocery and
HoReCa
Grocery: These are the outlets where consumers visit on a regular basis
with
a purchasing intention. They generally make a list of items before they
will
visit these sorts of outlets. These outlets typically offer variety in
terms
of product range and also flexibility in prices.
BATB has carried out significant activities for society such as Blood
Donation Programs, Immunization programs . The afforestaion program of
BATB
in khustia chittagong and some other areas of Dhaka have made
tremendous
contribution to the enviornement.
Afforestation in Bangladesh
British American Tobacco Bangladesh began its afforestation program in
1980,
to compensate for wood being burned as a fuel in tobacco curing. Due to
the
pressure on land for farming, farmers are at first reluctant to
allocate
land to trees, especially as they might not be able to harvest them for
some
years. British American Tobacco's solution was to plant fast-growing
trees
on canal banks, roadsides and railway embankments. To date, 710
kilometers
of canal banks, 115 kilometers of roadsides, and 52 kilometers of
railway
embankments have been planted. Through commitment by dedicated company
managers in the field, farmers' demand for saplings has increased to
the
point where over 3.5 million trees are planted annually. In 1993,
British
American Tobacco Bangladesh received the Prime Minister's Award for
Afforestation. As a result of the company's afforestation activities,
Bangladesh now has a wood fuel surplus of 80,000 metric tones.
Support Functions
Humana Resources
HR Mission:
Embedding winning culture where people always strive to excel.
Communication
? They try to create and maintain a communication channel between the
management and the employees independent of union influence.
? Employee briefing session.
? Quality circle meeting.
? Direct written Communiqué.
? Discussion with the union.
? Open forum.
? Housing magazine.
? Annual report booklet for the employees.
? Training and motivation session
Compensation Management
? Employee services
? Workers' canteen
? Dispensary and medical treatment.
? Scholarship for employees children.
? Uniform.
? Benevolent fund.
? PF loan.
? Retirement benefits.
? Long service awards.
? Personal Records and Statistics
Security:
? Employment of security staffs.
? Checking of all outgoing vehicles.
? Spot-check of goods truck.
? Physical checking of workers while leaving.
New HR Practices & Programs:
BATB now values its people as Human Capital. As a measure to that, BAT
has
taken extensive training programs, which include educational programs
like
English training, Computer literacy etc. In order to improve individual
performance, different skill development programs are also in place.
Teams
are being formed to implement flexible work practice.
Removal of barriers:
Barriers, both physical and mental, were hindering the progress of the
company. Company started removing barriers from early 1999. All offices
were
brought into a single location and all offices were made open. Managers
and
employees started using the same dinning facility and the same uniform.
Managing Director initiated Skip Level meeting with all levels of
employees
where issues are discussed openly. A Family Day was arranged where all
members of the organisation participated along with their family
members and
enjoyed throughout the day.
Reward system
BATB has introduced new Reward and Recognition system throughout the
company
to motivate the employees. Any employee, doing something extraordinary,
is
being selected as Champion for a specific month. As a result, people
are
opening up and trying to grab the title. This has generated a positive
competition among the employees.
Achievement:
a) Vision: We understand what each of us has to do.
b) Map: We believe in our plan.
c) Consumer focus: We live for our customers.
Commitment:
a) Confidence: We expect to win.
b) Standards: We keep raising our standards.
c) Drive: We take personal responsibly.
Trust:
a) Teamwork: We have trust in each other.
b) Support: We learn from Each other.
c) Belonging: We are proud of who we are.
There are certain guiding principles that center around the corporate
principles of the company. The core asset of the company is a result of
the
four philosophies that the company adheres to in every management
aspect of
the organization:
Open Minded
It encourages within the organization to be able to maintain an
environment
where the managers can have open-minded approach to various strategic
decision-makings.
Enterprising Spirit
The core asset of the organization will come from the enterprising
spirit
embedded in the minds of the managers, resulting from effective
strategies.
Information Technology
Mission:
‘The mission BATB IT is to enhance BATB's competitive position by
increasing operational efficiency and timely decision making through
measurably better and more compatible information system, and by
harnessing
the most appropriate technology and implementing new business practices
to
enhance BATB's business effectiveness.’
Finance Department
Budget
The Budget process is done at BAT in two steps. First the former year
annual
report is taken as the base of the budget. And in the second step, top
management with the help of financial department tries to integrate
proposal
of the next year, which have been already established. The proposals
have
been considered from the viewpoint of inflation of the currency, cost
of
living, and exchange rate prevailing in the country. By integrating the
proposals the concerned authority figure out the costs involved. After
that
they add these costs with the former year Annual Balance sheet and thus
formulate coming years budget.
There are various parties involved in making and executing the budget.
Some
of the parties are organization, Budget Committee, Negotiation,
Issuance of
guidelines, Initial Budget Proposal. As all the costing comes from
various
departments and units so the role of the organization as a whole is
vital
preparing Budget.
BAT always keeps a budget committee for each year and this committee is
consisted of MD, National Sales Manager, Finance Director and Chief
Accountant. This committee reviews the budget then either approves or
adjust
the same. BAT is not allowed to do any budgetary activities other than
directed by the main Head Office.
About account receivable, the company does not make any credit sales,
the
amounts depicted are from other sources. Leased holdings, land and
building
are depreciated over the life of the lease term.
BAT Bangladesh will seek to take forward cover for all known
commitments
within the constraints imposed from time to time by the Bangladesh Bank
or
the government. For offshore commitments denominated in Taka, for
instance
dividends and royalty, BAT Bangladesh will hedge the exchange rate only
if
requested to do so by the beneficiary.
For the present, the company deals with any of the following banks for
its
foreign exchange transaction:
Accounting Department
Wages Section
? Payments of wages to the workers.
? Dealing with the allowances like smoking allowances, festival
bonus, and annual bonus.
? Payment of the areas after the LTA.
? To inform the Head Office about the employees group insurance.
? Payment to the Badli and casual workers.
? Reporting monthly reports to the Head office and HOD of different
departments.
Cash Section
Deals with all sorts of cash receipts and payments e.g. PF loan and
refund.
Scrap selling, Waste paper selling, Selling of tobacco waste, Misc.
payments.
R&RS Section
The section deals with the imported parts locally fabricated parts and
the
items those are bought against works order. The following are the
functions:
? Costing of spare parts
? Budgeting for spare parts.
? Record keeping about the value and quantity of the spare parts.
? Processing the bills for these items.
Costing Section
? Leaf costing.
? Wrapping material costing
? Standard costing of product.
? Marginal costing.
Industry Analysis
Threat of Rivalry
Rivalry depends on mostly in terms of price and quality. International
brand
image, major competitors consists of domestic manufacturers are
accounted
for the rivalry. The industry is still growing opening the door of
opportunity for augmented business as consumers are up coming from Biri
to
cigarette. Rivalry in this particular segment is very intensive in
terms of
price rather than quality
Different brands of BATB and market share of its competitors are shown
on
the basis of price segment in table –2:
Beside BATB, a number of the companies are engaged in manufacturing and
marking cigarettes. They are:
? Dhaka Tobacco Company
? Alpha Tobacco Company
? Nasir Tobacco Company
? Abul khair Tobacco Company
? Sonali Tobacco Company
Moreover, there are also some foreign brands, which are either smuggled
or
imported illegally. which have been termed as transit brands. The most
important brands in this category are Dunhill, Benson & Hedges,
Marlboro,
London etc. It is notable that recently Marlboro has started operating
seriously in Bangladesh.
The market share of BATB is around 51% in the Dhaka Metro. The share of
all
other companies in Dhaka Metro is shown in table-3 and pie chart.
The above chart shows that BATB is holding the major portion of the
market
share in the whole country amounting to 41% and the nearest rival is
Dhaka
Tobacco with market share of 22% followed by Alpha Tobacco with 8%
market
share.
Though BATB is holding the major market share in the Dhaka City as well
as
whole country, there are also other companies that are operating in the
market.
Therats of Substitute
But in the mid-price segment the key for the substitution is the cost
as
well as price. Product with more and new attributes can create product
substitution in this segment.
In the premium price segment quality and product image is key for the
substitution. Customers in this segment are brand loyal.
Strengths
Organizing
? Common organization culture
? Organizational change by changing goals
Staffing
? Rapid advancement highly desired and demanded
? Reward for individual achievements
? Training and development undertaken
Leading
? Directive style, strong, firm and determined
? Leaders are decision maker is heading the group
Controlling
? Control by supervisor
? Control focus on individual performance
10. BATB is the largest tax payer in Bangladesh: BAT is the largest
tax
payer in our country. It paid more than Tk. 267 million tax in the
year
1998 (source: Annual Report 1998). As a result of this huge amount
BATB
enjoys a cordial relationship with the govt. of Bangladesh.
11. Low manufacturing cost: There are many reasons for low
manufacturing
costs of BATB. First, it can hire labor at a cheaper rate, which is
not
possible in developed countries. Secondly. The company has been using
the
latest technology in production by which it is able to minimize its
production cost by producing bulk of cigarettes. Thirdly,
transportation
cost is also comparatively lower in our country.
Weakness
1. Strong Trade Union: Trade union is one of the weakness for BATB.
They are
resistant to any changes. It takes lot of management effort and time to
make
the union leaders to motivate for any minor changes in the entire
process.
Management in BATB is working hard to change the culture and practice
through different projects and program.
Opportunities
1. Recent Global Merger with Rothmans: Recent global merger of BAT
with
Rothmans Industries and closer of all Rothmans facilities in South Asia
gave
BATB opportunity to become regional source of John Player Gold Leaf &
Benson
& Hedges for Middle-East market. BATB already sent samples of these two
brands for physical & sensory test in R&D Center in the head quarter.
5. 80% people smoke Biri: In our country a large section of urban and
rural
people smoke Biri. This means that the market potential of BATB is
very
high. If the Biri consumers can be persuaded to smoke cigarettes
instead,
the company will have a very big market for its products in this
country.
Threats:
1. Anti smoking lobbies activities: Anti-Smoking lobbies are now
getting
very strong in Bangladesh. Recent demonstration against Voyages of
Discovery
(VOD), a global campaign of John Player Gold Leaf and government
legislation
against ban in cigarette advertisement in all media reflects clear
threat
for cigarette industries.
2. High Excise rate : Excise is another threat for BATB. In the recent
past
there was several increases in tax structure specific to BATB to get
more
revenue for the government. If this continue BATB’s strategy for price
leadership will be at stake.
The performance of each brand was seen from the time of its inception
and
the trend was then discussed. For a better understanding Boston matrix
is
also applied on different brands of BAT such as B&H, SE 555, Gold Leaf,
Capstan, star and Scissors and described briefly their position in the
market.
Star
**
(STAR Brand)Question Marks
??
(CAPSTAN Brand)
Cash Cow
(GOLD LEAF, SCISSORS) Dogs
(B&H, SE 555 Brands)
BATB is in the Cash Cow segment of Boston Matrix. Cash Cow implies low
growth, high share business and products. In this segment the company
produces a lot of cash to support its different business units.
According
to the strategy when a market’s annual growth rate falls below 10%, the
Star
becomes Cash Cow. Evidences shows that the company’s growth is
decreasing
since last three years. Cash Cow also enjoys the economies of scale
and
higher profit margin. BAT is also enjoying the economies of scale,
that is,
it has been producing at a lower cost due to huge value of productions.
Production materials are also relatively cheaper in Bangladesh compare
to
that in the developed countries. At the same time BAT has been
achieving
the highest profit among the competitors. A very few number of local
companies are its competitors. No other MNC cigarette companies had so
far
been operating in Bangladesh even a few months back. However, recently
only
one MNC – Phillip Morris Inc. – has started its operation in
Bangladesh. So
it would be quite some time before BAT faces severe competition and
hence,
BATB is expected to retain stable position in Cash Cow even in the
coming
days.
It is the most popular and traditional brand across the globe and even
in
Bangladesh. The Benson & Hedges Lights is a new member of B&H family.
It was
first introduced in 1998 in Dhaka and Chittagong. The objective was to
give
the smokers more options within the same brand and to keep pace with
the
modern trend of smoking light cigarettes throughout the world.
National sales showed that the position of B&H is conversant with the
Dog’s
cell, which indicates low growth, low share of business and products.
Even
though B&H is recognized as a prestigious brand of BATB, it is loosing
its
number of consumers due to high price. As a result, its sales volume is
very
low compare to other brands and it also registers low growth rate in
sales
in Bangladesh.
SE 555
SE 555 is the largest and fastest growing brand of BATB; its position
is not
up to the mark in Bangladesh. National sales shows that the position
of SE
555 lies in the Dogs cell which indicates low growth and low share.
The
price of SE 555 is also very high (Tk. 3 per stick) compare to other
local
brands and Bat’s own brands. Its sales volume is very low and having a
very
low growth rate. The sales trend is shown below:
Gold Leaf
JPGL is the number one brand of BATB and is the leader in the cigarette
industry of the whole country in terms of market share and total
turnover.
It draws about 50% of the total revenue of BATB. Bangladesh is the
largest
of the 33 JPGL selling countries.
Due to reasonable price (Tk. 2 per stick) people of medium and low
medium
income group can easily afford it. It was launched in 1980 for the
first
time in Bangladesh. After reviewing national sales it can be inferred
that
from the commencement period of the brand, it realizes the highest
share and
highest growth. But at present the brand growth is not increasing as
the
previous trend due to mild competitive pressure. The above attributes
of
Gold Leaf are conversant with the Cash Cow, which means low growth and
high
share of business.
To keep pace with the global trend of lights and to support British
American
Tobacco Bangladesh’s corporate objectives of establishing leadership in
lights segment in Bangladesh, the management of BAT launched JPGL
Lights in
1997 in some selected outlets in Sylhet as a part of test marketing.
JPGL’s
association with the worldwide F-I powerboat racing was also
successfully
exploited in 1997 through a consumer promotional event under the banner
of
‘JPGL Carnival’, which took place in five key cities. The company
launched
the brand in 1998, with the unique product feature of ‘white tipping
paper’.
It is also in the cash cow cell.
Scissors
Star
Star Classic
Introduced into the market in February 2001, this brand targets the
medium
segment customers. Up until now, the brand has got moderate responses
from
smokers. However, it is very early to comment on the future of this
brand.
There are three filtered Star brands in the low segment. These brands
are
discussed below:
Star Filter Kings (KSF 20HL) has a very unstable position in the
market. The
sole reason is the accessibility of other brands at the same price. Not
only
local manufacturers are manufacturing cigarettes of this quality and
price
but also coming from other countries through illegal means.
The same cigarettes are available in a soft packet (Star Filter Kings
(KSF
20SC)), which is priced 30 paisa less. The sale trend is as shown
below:
Figure 15: The sales Trend of Star Filter Kings (KSF 20SC)
Star Plain
Star Plain has been losing its market very fast and in 2000 the total
sales
stood at only 53 million sticks! BATB needs to rethink its strategy to
increase the sales of this brand. The sales trend of this brand
follows:
Figure 16: The sales Trend of Star Filter Kings (KSF 20SC)
Capstan
Though I was an Intern of CORA I did not work in the core CORA but the
legal
department which was under CORA. The legal department had to handle a
lot of
cases for BATB. The cases were mostly of trade mark related cases,
distributorship cancellation cases, counterfeit cases which are handled
by
different legal farms of the country. I was taken to perform various
jobs.
My supervisor was the Company Secretary who headed the Company
Secretarial
and Legal Department within CORA. He reports to the Head of CORA as
administrative line manager and to Board of Directors for Board and
statutory affairs. Company secretarial and legal department handles the
corporate and legal issues of the Company. It has to perform cross
functional activities by the advice of the Board and line management
within
the laid down rules and regulations.
As I was not taken for any specific purpose I always had to run like a
chicken without head. In the second month I was told to collect
sensible
tobacco regulation by browsing internet and publish a wall magazine
“Infotopics” on weekly basis. At the end of the each month I had
prepare a
power point presentation for the Company secretary to update him those
issues.
My internship period was for three months and at the end of the period
my
internship was further extended for one and half month by BATB to help
in
the Annual General Meeting. The AGM exposure is totally different and
quiet
fascinating. I was involved in he book closure, dispatching of notice
to the
shareholders, selecting volunteers and distributing their duties and
responsibilities, proof reading and scrutinize printing of the annual
reports and ensuring support for a smooth event. I was involved in
preparing
different questions and answers that can be raised by shareholders
during
the AGM.
Analysis of Common Size Income Statement
One look at the common size income statement shows that there is not
much
change in any of the elements except the interest and tax. Interest has
increased because of increased short term loans and the tax has
increased
because of the increased tax the Government has imposed on the
cigarette
manufacturing companies.
Figure 17 : A graph showing value adding elements
in
1999 is given below:
Analysis of Common Size Balance Sheet
By looking at the common size balance sheet it can be seen that BATB
has
succeeded to lower its inventory overtime. The proportion of inventory
dropped to 42.31% in 1999. It can also be seen that in 1998 the
inventory
went as low as 40.55% but again rising for the last two years.
The proportion of debtors has somewhat remained stable but again the
sudden
drop in cash and bank balance in 1999 does not look good. Every
organization
should have cash reserve. The proportion of fixed asset has risen which
answers the question of where the cash has gone. The short-term bank
loan
seems to have increased over time. This is quite a big portion of the
total
liabilities. But the long-term liabilities has dropped immensely. The
share
capital has dropped substantially. The rise in retained profit shows
the
foresight of the company to expand more in future.
Appendix 1- Common Size Income Statement
Appendix 1-Common Size Balance Sheet
Ratio Analysis
By analyzing the data of last six years it has been seen that BATB has
enough asset to meet its obligations. But from the balance sheet it is
seen
that the current liabilities is rising faster than the current assets
which
led to poorer current ratio that is visible in the graph. The rise in
current liabilities resulted from the short term bank loans taken by
the
company. On the other hand the cash and bank balances has also
decreased
because of the sudden drop in the foreign currency accounts. If this
trend
goes on, the company will face difficult time in near future for paying
debts.
BATB has a quick ratio less than the current ratio showing that most of
BATB’s current assets comprises of inventory which we know to have
least
amount of liquidity. The trend analysis shows that the quick ratio is
falling meaning the company is building up its stock and failing to
sell
them off. So the company may face hardship if it faces the pressure of
paying of its current debts immediately. Again the net working capital
was
most of the time negative indicating that the firm has a permanent
shortage
of short term financing.
Asset Management Ratio
Again the inventory turnover ratio on average was 9.27 times. This was
quite
well compare to the other turnover ratios. But it can be considered a
reasonable one for decreased asset turnover in 1999. So the turnover
ratios
of the firm should be improved in order to obtain a high ROA.
A major shift was seen in the capital structure of the company. During
the
early periods the firm’s capital structure consisted of approx. 46%
debt and
54% equity. but the scenario changed over the years and in 1999 it was
about
61% debt and 39% equity. This is not a good sign as the firm was
increasing
debt though the proportion was not unusual. Provided below the debt and
equity ratio of the firm over the years:
Profitability Ratios
The average ROE is 26.68 and it showed an upward trend form 1994 but in
1999
it dropped down because of low profit. This was disappointing for
investment
concerns. Same trend is seen for ROA.
Market value ratios relate to the firm’s stock price to its earnings
and
book value per share. These ratios give management an indication of
what
investors think of the company’s past performance and future prospects.
This
ratio includes earning per share, book value per share and dividend per
share. Earning per share and dividend per share is being calculated for
better understanding.
Earning per share expresses profit on a per share basis. BATB has
always
high significant amount of earning to give to each shareholder. Though
the
amount decreased in 1999 due to lower profit, the company has the
capacity
of recovering it. So BATB is profitable place to invest for the
shareholders.
On an average, the firms plowback ratio was 55% and the payout ratio
was
45%. The firms had retained most of it’s earnings when the firm’s ROE
was
satisfactory and high. It’s plowback ratio was increasing over the
years
but suddenly declined in 1999 as the ROE had declined. Earlier, the
company
reinvested approx. 55% of it’s earnings but now the plowback has
declined to
32.42% . The dividend policy was quite efficient and the firm had paid
dividend consistently
Growth Rates
Growth of Sales:
As can be seen that the trend of sales in the last two years is
downward
which is not a good sign for the company and thus will effect the
coming
years. The management must devise ways to improve the sale figure.
Growth of Assets:
As the trend line is upward, the Company’s assets has been growing
consistently but the effect will be offset if sales doesn’t keep up the
pace.
Growth of Expenses:
This is also a bad sign for the company as the trend of expenses is
upward.
Management should therefore control operating expenses.
Bankruptcy Prediction
Z = 3.3 +1 + .6 + 1.4
+ 1.2
A cut-off point for the ‘Z-Score’ for the US firms were determined as
follows:
? Z- Score of 1.81 and less indicate bankrupt.
? Z- Score of 2.99 and above indicate solvent.
? Z- Score of 1.82 and above but less than 2.99 indicate zone of
ignorance.
A subsequent study for the UK by Altman and other established somewhat
lower
values in the above categories of Z-Scores.
• Z- Score of 1.50 and less indicate bankrupt.
• Z- Score of 2.00 and above indicate solvent.
• Z- Score of 1.5 and above but less than 2.00 indicate zone of
ignorance.
The Z –Score of BATB for the last six years are as follows:
Introduction:
Depository system is in vogue in the developed nations and it ensures
to
safeguard the interests of the investors. Having felt the absence of
the
system in Bangladesh capital market the foreign institutional investors
insisted upon the government to adopt the system on the pattern of
developed nations to assure safeguarding of their interests.
Accordingly,
the Government has enacted the Depository Act on April 13, 1999.
Limitations:
? As the Company who is responsible for implementing CDS is still not
in a position to give a clear picture about the procedure of CDS and
cost of
implementation by the companies and the cost of investors for taking
service, it is not possible to make quantitative analysis.
? For having a clear idea I had to depend on Websites and materials
of ‘ Investors Training Program’ organised by Securities and Exchange
Commission.
Depository Participants:
? Brokers & Dealers
? Banks &Non-Banking Financial Institutions
? Others, under discretion of the Regulatory Body
Prelude:
• The standards will meet the general expectation that everyone wants
to see
from a leading public company.
• The standards will set a tone and culture for the organisation, which
will
enable it to be regarded as a good corporate citizen.
• The standards will help the employees to make judgement in the course
of
their actions.
• These will give a clear picture about the code of business conduct to
the
stakeholders.
Ethical Standards
BAT wants all the employees to act with high standards of business
integrity
and does not want them to compromise those standards for the sake of
results. This standard is covered through trade etiquette standard of
BATB.
Conflicts of Interest
According to BAT and BATB standard, each employees should avoid
situation/discussion where his/her personal interest could conflict
with the
interest of the companies
Besides the standard of the parent company, BATB’s standard does not
allow
the employees to take part in relevant discussion or in the decision
making
process if such involvement create advantageous position for
himself/herself
or a close family member or friend.
Besides the business dealings, the employees are not allowed to involve
with
the commission or omission of any act, without prior disclosure , which
gives undue advantage to an outside party. BATB’s standard does not
focus
on such an important issue.
Entertainment
Gift
BAT discourages the employees to give or receive business gifts but
modest
gift is exception in both the ways. Giving or receiving lavish gifts
must be
approved by the employee’s manager.
Insider Dealing
According to BAT and BATB standard , employees who are aware of price
sensitive, non-public information which could affect the share price of
the
company , shall not use such information for profit or to avoid loss.
Both BAT& BATB standard do not allow the employees to disclose any
confidential commercial information relating to the group but allow to
disclose with the explicit permission of the appropriate Departmental
Head.
Press Interview
BATB standards does not allow the Members to make statement to the
press or
media which concern Company policy, sales, production cost, Trade Union
relation with without the prior permission of the appropriate
Department
Head/CORA. BAT Standard is very straightforward in this case. In
handling
media, BAT standards advise to obtain guidance from CORA.
Exports
Trade Etiquette
Standards Violation
Both BAT and BATB standards want the employee to report any breaches
of the
aforesaid standards of business conducts to the Head of Department or
if
necessary to the MD.
But unlike BAT Standards, BATB standards ignores the fact if a director
or
manager asks the employees to involve in illegal activity or violation
of
standards. The direction should be given clearly.
Recommendations:
Recommendations are given while the comparison is done.
British American Tobacco Bangladesh
Policy on Advertising and Promotion
1. Preamble:
1.1 British American Tobacco Bangladesh is proud of its reputation for
manufacturing high quality cigarettes and other tobacco products which
are
enjoyed by million of adult smokers around the country. In a
competitive
market, we want adult smokers to choose our brands over those of our
competitors.
1.3 These principles provide the standard by which we ensure that our
Advertising efforts are consistent with this position. They will be
applied
to a rigorous standard, and with regard to the cultural environment and
the
local law and / or industry code. For the purpose of these Principles,
an
adult is defined as anyone who is 18 years of age over as the law of
Bangladesh.
2. Policy
2.1 It is the policy of British American Tobacco Bangladesh to strictly
abide by all laws and regulations affecting our product advertisement
and
promotional activities and to maintain the highest industry ethical
standards in this respect.
2.5 The size of the Health Warning Clause on all tobacco communication
will
be 10% of the total communication area.
2.9 To ensure compliance and that lapses do not occur, all product
advertisement and promotional plans company-wide must be submitted to
the
Secretarial Department for confirmation of legal compliance prior to
the
issue or implementation. However, re-run or reuse of advertisement and
promotional plans which have been earlier confirmed by the Secretarial
Department need not be resubmitted unless the concerned manager is in
doubt
of its full compliance with this Policy at the time of reissue.
Advertising
agencies dealing with Company’s business must be thoroughly appraised
of
this Policy and warned of the consequences.
Non-Adults
2.18 Any material received from any agency or third party which does
not
comply with this Policy will be rejected and a written reply to this
effect
will be sent to the party concerned.
3. Policy Implementation
3.1 To ensure that this Policy has been clearly understood by all
concerned,
that administrative procedures are adequate and effective to ensure
compliance, and that breaches of the Policy are brought to the
immediate
attention of the Company, following measures have been brought into
effect.
The Marketing Manager will fully explain these procedures to the
concerned
managers.
- issue of the Policy to all advertising agencies engaged by the
Company.
- Issue of the Policy to Head of Brand, Head of Trade and
Distribution,
Head of CORA and Company Secretary.
- Holding of discussion meeting at the time of issue of the Policy
- Yearly appraisal of individual managers will record any
non-compliance of
the Policy
- Monthly meetings both at Unit and Head office level will also record
any
non-compliance
- Monthly reports on breaches of the Policy
- Periodical review of compliance and administrative measures by
internal
audit.
- Yearly confirmation in a Board meeting.
The Policy comes into effect immediately on issue
Record- Definition
A record is any paper, micro film, electronic or other information
medium
created or received by a company and its employees in the course of
business.
Records include, but are not limited to, all papers, books,
photographs,
microfilm, maps, drawings, charts, discs, audio and video tapes.
Records Management
An administrative system by which an organization seeks to control the
creation, distribution, filing, retrieval, storage and disposal of the
records which are created or received by that organization in the
course of
its business.
Records Management Aspects
Records Management is about managing records from the time they are
created
or received until they are disposed of or sent to permanent storage.
We concentrate on two aspects.
? Creation
? Retention and disposal
Records creation
Any way in which a record can be produced, whether by writing, typing,
drawing, copying, recording or by electronic or other means.
Records Retention
The whole process by which a company:
• Decides how long it needs to keep its records;
• Formally records its decisions as Approved Retention Schedules;
• Ensure compliance with those Schedules, including prompt disposal of
records which are no longer required.
Retention Schedules
Comprehensive listings of records held by an organization, giving a
variety
of
information about each category (series) of records, such as:
? Title, brief description, and media code;
? Whether the record is in the department responsible for keeping
it;
? Approved retention periods;
? Details of it and when records are to be sent to the storage;
? Disposal instructions;
There are two types of Retention schedule:
? General schedule for all workgroups
This lists all the common records which are found in most offices. It
is
used by
everyone who handles records.
? Workgroup schedule
This lists all those records specified to a particular work area
Records Series
A group of records arranged in a common file structure and/or set of
sequences (usually
in numerical, alphabetical or date order or in a computer directory or
sub-directory).
All the records in a series relate to a similar type of activity, are
in the
same physical
form and have the same retention period.( E.g. Bank is a series and
SCB,CAI,Pubali,
Sonali is file)
Workgroup
A Workgroup consists of one or more people sharing a common body of
work,
information and therefore records. (e.g.Trade Development )
It may or may not be the same as a department, or section within a
Department, as shown on an organization chart.
Department of Record
The Department or Workgroup responsible for keeping the original or
"official" copy of a
record.
Department of Record is abbreviated to "DR" on the forms. (E.g.
Corporate
Reporting is DR for Budget, HR is DR for Salary) )
Program objective
? Retention for proper time periods
To ensure that Company records are maintained for as long as they are
needed
and no longer, taking into account business, legal, tax, audit and
archival
requirements
? Business efficiency
To improve and update management of records to maximise their use
as a
business resource.
Policies
Records include all paper, microfilm, electronic or other information
media
created or received by an organisation and its employees, regardless of
location.
? Ownership of records
All records created or received by employees in the course of business
are
the property of the company concerned and do not belong to individuals
or
departments.
? Records Retention Decisions
The Company decides how long to retain its records
? Creation of Records
Records should be created only if there is an identifiable business
&
Regulatory
need for them. Personal or telephone communication is often more
effective
than
writing.
? Temporary Records
Records of a temporary nature (drafts, messages, personal reminder
notes, etc.) are to be destroyed as soon as possible and not filed.
? Routine Records
Other records of a routine nature (general correspondence and
administration, covering memos, travel details, etc.) should be
destroyed as
soon as they have met immediate needs.
? Copies
The number of copies of any record should be kept to a minimum.
Individuals
receiving copies from others inside the Company should destroy them
when
they have met immediate needs.
? Employee Changes
Any records left by employees who leave the Company or are transferred
within the Company are to be reviewed and either disposed of or
integrated
into existing files as soon as possible.
? Hold Orders
Normal destruction procedures must be suspended if a specific
instruction
("Hold
Order")is given in response to legal, tax or audit advice.
? Storage of Records
Records identified on an approved Retention Schedule as having long
(generally over three years) or permanent retention periods and high
volumes
should be stored in the most appropriate and cost-effective way.
? Updating Instructions
Retention Schedules and procedures must be updated as necessary to
reflect
any changes in operational or legal requirements.
? Yearly Review
A review of all records must be made at least once a year to ensure
retention or destruction in accordance with the Retention Schedules.
? Destruction methods
Methods of destruction should be appropriate to the type of record
to
ensure security where required.
? Yearly Audits
An audit should be conducted at least once a year to ensure
compliance
with the approved Retention Schedules.
? Improved Records Management
While reviewing records retention requirements, opportunities
should be
taken to identify areas for further improvement in records management
procedures.
Records Creation-Summary
? Think before you write
? Never create records ”just in case”
? Does it really need to be in writing
? How sensitive is the information?
? If you must write: Be precise, Avoid personal or inflammatory
remarks, Don’t give expert advice, ensure accuracy
? Keep copies to a minimum
? Date all records and mark drafts
Program Responsibilities
Individual Manager
Ultimate responsibility of records management
Records Coordinators
Co-ordinate with in the Department
Workgroup Managers
Workgroup managers determine business retention periods and supervise
disposals
Facility Managers
Ensures records management within the facility
Department Managers.
Ensures that annual disposals take place and Certify to General Manager
that
disposals have been done correctly
General Manager
Overall responsibility and preparation of annual compliance statement
for
BAT Board.
Prelude:
As we are involved with a controversial Industry, it is very important
for
us to build our corporate reputation by maintaining a healthy
relationship
with various stakeholders like Government, employees, stockholders,
consumers and society. As we all are aware about the poor condition of
the
railway stations of Bangladesh specially the waiting room, we want to
provide our sincere effort to improve the condition of waiting rooms of
very
important railway stations of two routes- Rajshahi to Shantahar and
Dhaka to
Sylhet and based on the experience new action plan will be prepared.
Objective:
• To enhance the image and reputation of the company.
• To make the people understand that we share social responsibility.
• To show a new path to the Railway about customer care.
• To become one of the top F.M.C.G Company in Bangladesh.
Strategy:
• The stations to be identified through comprehensive data collection
to
assess the traffic.
? The market research agency can involve the local college students
(above 18 Years of Age) for the aforesaid purpose which will promote
company
name.
• Based on the survey, 15 heavy traffic railway station of
Rajshahi-Shatahar
Route of North Bengal and another 15 of Dhaka-Sylhet Route of East
Bengal
will be taken for modernizing the waiting room. Initially 3 heavy
traffic
stations from each route will be taken in the pilot project as a trial
and
error basis for better understanding.
• Local TMD and Distributor to be involved to participate in the
project
along with HO support.
• The cleaners should be provided dress with Company name and logo.
This
will promote the company name to the general people.
• A separate smoking corner should be there as many passengers will
definitely smoke in the waiting room which is risky for children and
non-adults. In the waiting room, campaign against non-adults smoking
can be
carried out which will prove how much caring we are about the future
generation and general people.
Activities:
• Identified stations to be marked with joint survey.
• A formal meeting to be organized with Railway Authority to assess
their
views.
• A meeting to be organized with Communication Ministry to obtain their
agreement support to undertake the task.
• A meeting to be organized with local TM&D and Distributors for their
support.
Especial Facilities:
• Marked area for saying prayers.
Execution:
If above points are cleared, we have to assess the fixed cost and
running
cost.
Running Cost
1. One cleaner for 3 station to clean the room and latrine once in a
day.
Tk.40001* 2 = Tk.8,000
2. One supervisor in each route to ensure that the cleaners are working
properly and all the activities provided are functioning properly.
Tk. 6000 * 2 = Tk.12000.00
3. Cleaning materials like broom, harpic will cost
Tk.100*6 = Tk. 600 .
4. Others cost (like lights, Badna, maintenance of waiting room and
tube
well)
Tk 500*6=Tk. 3000.00
Total Running Cost : Tk. 8,21,600.00
Where to report :
The reporting or contact point will be nearest distributors for
disbursement
of salary and supervisors will take any administrative action with the
consent of the T.O. or Regional Office.
How the Co-ordination will take place:
From the Head Office Department of CORA will maintain liaison with the
regional office of TM & D and will observe how the project is going on.
Conclusion:
The project will be carried out for two years and then it will be
handed
over to Railway authority. By this time, if per day 1000 people move
through
these 30 stations total 30,000 people will get our message. If 15% of
them
or adult smokers, at least 5% of those will prefer our products.
Prelude:
As we are involved with a controversial Industry, it is very important
for
us to build our corporate reputation by maintaining a healthy
relationship
with various stakeholders like Government, employees, stockholders,
consumers and society. This time to meet social responsibility, our
sincere
effort will be delivered to the poor cataract patients.
The scenario is almost same for all over the Bangladesh but we must not
forget these are the two districts which are famous for tobacco
cultivation
and now we can see a declining trend of tobacco cultivation over there.
Strategy:
Cost Allocation:
Activities:
• A formal meeting to be organized with CERCE to assess their views.
• A meeting to be organized with local TM&D and Distributors for their
support.
Benefits:
Conclusion:
Looking very ambitious though, the proposal has been made on necessity
for
the proposed area . The target is not ambitious and very much possible
to be
accomplished if BATB extends its support to these poor people.
Data Collected from P.S.P Carried out by Community Eye Care and
Research
Center:
Sl.No Date Name of the Area Total Number of Patients Operation ECCE
DCR
1 14/9/00 Shukurer Hat College
Thana:- Mithapukur
Dist: Rangpur 150 36 36 -
2 17/9/00 Tepa Modhupur College
Thana:- Kawnia
Dist: Rangpur 109 13 11 2
3 19/9/00 Taraganj Ecorchali Union
Thana:- Taraganj
Dist: Rangpur 158 29 29 -
4 26/9/00 Chowdhurani College
Thana:-Pirgachha
Dist: Rangpur 191 38 34 4
5 28/9/00 Paglapir College
Thana: Gangachara
Dist: Rangpur 119 24 18 6
6 11/10/00 Zaigir Edulpur Madrasha
Thana: Mithapukur
Dist: Rangpur 113 29 27 2
7 16/10/00 Shatibari Islam Alem Madrasha
Thana: Mithapukur
Dist: Rangpur 140 26 22 4
8 18/10/00 Pirganj College
Thana: Pirganj
Dist: Rangpur 100 26 25 1
9 21/100/00 Pirgachha Thana Complex
Thana: Pirgachha
Dist: Rangpur 148 22 20 2
10 23/10/00 Kawnia Girls’ School
Thana: Kawnia
Dist: Rangpur 159 38 31 7
11 3/11/00 Badarganj High School
Dist: Badarganj
Dist: Rangpur 135 29 28 1
12 8/11/00 Kishha Dimukhi High School
Thana: Kawnia
Dist; Rangpur 127 37 32 5
13 30/01/01 Shadullapur Hospital
Thana & Dist: Gaibandha 111 30 25 5
14 3/2/01 Saidpur Golger Boarding
Thana: Saidpur
Dist: Nilphamari 104 29 35 1
15 16/3/01 Gaibandha
Thana & Dsit: Gaibandha 200 29 27 2
16 20/3/01 Sundarganj High School
Thana: Pirgachha
Dist: Rangpur 168 27 25 2
17 24/03/01 Tulshi Ghat High School
Thana & Dist: Gaibandha 150 50 46 4
18 28/03/01 Saidpur Gilger Boarding
Thana: Saidpur
Dist: Nilphamari 103 22 20 2
19 20/4/01 Gaibandha Hospital
Thana & Dist: Gaibandha 117 29 28 1
[These two Checklists were prepared to ensure compliance with the
statutory
requirements of DSE , CSE and Companies Act 94.]
Certificate of shares
Sl. No. Clause Description Action
01 158 The allotment of any shares and the registration of transfer of
any
shares should be delivered to the holders Within 90 days.
42 A company may close the registrar of members for any time or times
not
exceeding in the whole 45 days in each year but not exceeding 30 days
at a
time. Seven day’s notice by Advertisement in some newspapers.
References
Fixed Assets
Long Term Loans and Advances 1036 1289 1494 2058 1428 1294
Fixed Assets 909501 1189173 1365923 1849022 2180470
2316063
Current Liabilities
Equity
Fixed Assets
Long Term Loans and Advances 0.05 0.05 0.06 0.06 0.04 0.03
Fixed Assets 44.33 46.52 53.39 56.49 54.89 54.90
Short Term Bank Loans 0.00 11.73 9.77 21.39 13.85 21.33
Creditors & Accruals 19.32 20.80 23.90 18.52 19.36 24.47
Bank Overdrafts 12.83 11.28 7.33 5.35 6.20 1.35
Provision for Corporate Tax 3.50 0.27 0.11 1.52 4.03 1.78
Proposed Final Dividend 5.85 6.26 4.69 4.89 5.03 3.79
Installments of Medium Term Loans 0.00 0.00 0.00 0.00 3.78 3.56
Total Current Liabilities 41.49 50.34 45.80 51.67 52.24 56.28
Equity
Total Liabilities & S/E 100.00 100.00 100.00 100.00 100.00 100.00
Common Size Income Statement(1994-99)
Fixed Assets
Equity
Liquidity Ratio
Current Ratio 1.34 1.06 1.02 0.84 0.86 0.80
Quick Ratio 0.05 0.09 0.03 0.06 0.06 0.05
Assets Management Ratio
1994 1995 1996 1997 1998 1999
Inventory Turnover 8.23 8.57 10.92 11.32 8.62 7.97 9.27
Fixed Asset Turnover 9.96 9.01 9.25 8.11 6.56 6.14 8.17
Total Assets Turnover Ratio 4.42 4.20 4.95 4.59 3.61 3.37 4.19
Capital Intensity Ratio 0.44 0.47 0.53 0.57 0.55 0.55
Current Assets Intensity Ratio 0.56 0.53 0.47 0.43 0.45 0.45
Fixed Assets Turnover Period36.14 39.94 38.91 44.37 54.84 58.62
Total Assets Turnover Period 81.43 85.78 72.80 78.45 99.85 106.70
Inventory Turnover Period 43.72 42.00 32.98 31.81 41.76 45.15
Daily Sales (000s) 25195.10 29802.99 35146.81 41721.12
39784.19
39535.22
Daily Sales Outstanding
Debt Management
Working Capital
Glossary
Current ratio :It measures the short coming debt paying capacity of a
company. It is calculated by dividing current assets by current
liability.
Liquidity: The ability of a company to meet its cash needs either from
cash
balances or timely access to cash. Also refers to the cash with which
an
asset or security can be turned into cash.