Ratio Analysis Textile Industry

RATIO ANALYSIS- TEXTILE INDUSTRY
Presented by: Aleena Inayat Hassan Hanif Haseeb Abid Kiani M. Naeem Riaz
Presentation layout
Introduction of textile sector Introduction of companies
Ahmad
Hassan Textile Mills Bhanero Textile Mills Nishat Mills Limited
Ratio Analysis Comparison of the companies Conclusion
Textile sector of Pakistan

4th largest cotton producer in the world 8th largest exporter of textile products Contribution to GDP- 8.5% Employment to 15 million people- 30% of the workforce Annual volume of world textile trade growing at 2.5%- Pakistan's share less than one percent

Growth from 2005 to 2007 Decline in 2008- global financial and economic meltdown Governments vision for textile industry 2005-2010
of textile sector is included in list of value added industries 5% custom duty on imported machinery if not manufactured locally Tax relief: Initial Depreciation allowance (IDA) at 50% of machinery & equipment cost
Whole

Export plan 2006-13
Increase
exports to $24.36 billion
Introduction of companies- Ahmad Hassan Textile Mills

Mission statement
To
achieve & sustain good reputation in international market by manufacturing quality products. Management of timely deliveries & quality assurance. Ensure a consistent quality & timely deliveries & shipments, by carrying all the time cotton yarn stock of 90-180 days production
Introduction of companies- Ahmad Hassan Textile Mills

Incorporated in 1989 Products
Cotton fabrics Cotton yarn Textile all sorts
Main business type- exporter Major importers of its yarn

America Hong Kong Sri Lanka
Introduction of companies- Bhanero Textile Mills

Vision statement
A
Premier Quality Company, Providing Quality Products and Maintaining an Excellent Level of Ethical and Professional Standards become a leading manufacturer of textile products in the International & local markets and to explore new era to Achieve the highest level of success
Mission statement
To

Umar group of companies established in 1982
Bhanero
textile mills Faisal spinning mills ltd Blessed textiles ltd
Products
Cotton
yarn High and medium end cotton products

State of the art equipment Diverse product range Weak R&D facilities Small international market share Weak brand name
Introduction of companies- Nishat Mills Limited

Vision statement
To transform the Company into a modern and dynamic yarn, cloth and processed cloth and finished product manufacturing Company that is fully equipped to play a meaningful role on sustainable basis in the economy of Pakistan To provide quality products to customers and explore new markets to promote/expand sales of the Company through good governance and foster a sound and dynamic team, so as to achieve optimum prices of products of the Company for sustainable and equitable growth and prosperity of the Company
Mission statement
Introduction of companies- Nishat Mills Limited

Flagship Company established in 1951 At par with multinationals operating locally Products
Cotton
fabrics Cotton yarn Textile all sorts
Ahmad Hassan Textile Mills

Days sales in receivables
2006 Days sales in receivables 20.20 2007 19.51 2008 23.20 2009 31.79 2010 21.72
Except for in 2009 where trade debts rose significantly as compared to increase in net sales the ratio has been fairly consistent. Days sales in receivables
35 30 25 20 15 10 5 0 2006 2007 2008 2009 2010 Days sales in receivables
Accounts Receivable turnover

2006 Accounts receivable turnover 17.63 2007 19.08 2008 18.18 2009 13.654 2010 15.41
The ratio indicates a poor ability of the company to manage its receivable which improved only slightly after 2009.
Accounts receivable turnover

25 20 15 10 5 0 2006 2007 2008 2009 2010 Accounts receivable turnover
Accounts Receivable turnover in days

2006 Accounts receivable turnover in days 20.69 2007 19.15 2008 20.07 2009 26.73 2010 23.68
days sales in receivable the ratio is significantly higher in 2009 due to an increase in trade debts.
Accounts receivable turnover in days

30 25 20 15 10 5 0 2006 2007 2008 2009 2010 Accounts receivable turnover in days
Days sales in inventory

2006 Days sales in inventory 86.07 2007 78.99 2008 90.50 2009 104.53 2010 75.70
The ratio has been consistent until it started rising after 2008 and in 2009 because of increase in inventory the ratio was the highest after which the sales improved and the ratio started improving. Days sales in inventory
120 100 80 60 Days sales in inventory 40 20 0 2006 2007 2008 2009 2010
Inventory turnover
2006 Inventory turnover 4.55 2007 4.59 2008 4.66 2009 3.78 2010 4.56
The ratio is fairly consistent except for in 2009 due to increase in the average inventory. Inventory turnover
5 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 2006 2007 2008 2009 2010
Inventory turnover
Inventory turnover in days

2006 Inventory 80.26 turnover in days 2007 79.57 2008 78.33 2009 96.50 2010 80.03
The ratio increased in 2009 due to disproportionate increase in inventory as compared to net sales. Inventory turnover in days
120 100 80 60 Inventory turnover in days 40 20 0 2006 2007 2008 2009 2010
Operating cycle
2006 Operating cycle 100.95 2007 98.72 2008 98.4 2009 123.23 2010 103.98
The operating cycle increased in 2009 due to increase in inventory turnover in days. Operating cycle
140 120 100 80 60 40 20 0 2006 2007 2008 2009 2010 Operating cycle
Current ratio
2006 Current ratio 0.85 2007 0.82 2008 0.67 2009 0.76 2010 0.73
The firms current ratio is already indicating that its current liabilities are greater than current assets and to make matter worst the ratio is deteriorating from 2006 to 2010.
Acid-test ratio
2006 Acid-test ratio 0.16 2007 0.17 2008 0.14 2009 0.18 2010 0.16
Uses current assets to indicate the short term debt paying ability. In 2009 due to increase in trade debts the companys acid-test ratio increased.
Cash ratio
2006 Cash ratio 0.011 2007 0.026 2008 0.0075 2009 0.001 2010 0.00087
The fluctuations in the cash ratio are due to changes in the shortterm investments held for sale by the company.
Debt ratio
2006 Debt ratio 0.78 2007 0.80 2008 0.71 2009 0.74 2010 0.703
Debt ratio indicates the firms long-term debt paying ability. On average over 70% of the companys assets are financed by its creditors indicating a poor debt paying ability.
Debt/Equity ratio
2006 Debt/equity ratio 3.5 2007 4.02 2008 7.19 2009 8.49 2010 6.73
This ratio helps determine how well creditors are protected in case of insolvency. An increase in the ratio till 2009 indicates that the creditors are well protected.
Net income margin

2006 Net income margin 1.42% 2007 0.13% 2008 -0.041% 2009 -1.93% 2010 1.7%
The company was doing very poorly because of lower sales and higher administrative and other expenses but sales soared and the company gained profit to increase its net profit margin in 2010.
Total Asset Turnover

2006 Total asset turnover 1.25 2007 1.22 2008 0.89 2009 0.093 2010 1.17
It indicates the activity of assets and the ability of the company to generate sales through the use of its assets. The drastic decrease in 2009 is a result of not enough sales for the company for the year and the company ending up in loss. Total asset turnover
1.4 1.2 1 0.8 0.6 0.4 0.2 0 2006 2007 2008 2009 2010 Total asset turnover
Return on Assets
2006 Return on assets -0.40% 2007 0.174% 2008 -3.02% 2009 -2.189% 2010 2.03%
Due to the fact the company reported losses in the year 2008 and 2009 the companys return on assets was negative. After 2009 its sales increased and so did the return on assets. Return on assets
3 2 1 0 -1 -2 -3 -4 2006 2007 2008 2009 2010 Return on assets
Operating income margin

2006 Operating income margin 7.4% 2007 6.205% 2008 3.31% 2009 8.913% 2010 8.38
This ratio includes only the income from the main line of operations of the business. The company was not doing well in 2008 because of lower sales and greater expenses.
Operating asset turnover

2006 Operating asset turnover 2.074 2007 0.195 2008 1.27 2009 1.379 2010 1.88
The decrease in 2007 was due to increase in the operating assets but a decrease in operating income for the year.
Return on operating assets

2006 Return on 15.34% operating assets 2007 12.10% 2008 12.19% 2009 12.29% 2010 15.7%
It is an indicative of how much return you are receiving on your operating assets. It shows and increase towards an end due to increase in sales and subsequently the operating income.
Return on total equity

2006 Return on total 1.76% equity 2007 0.84% 2008 -30.7% 2009 -23.61% 2010 23.03%
Due to the fact that the company reported loss in 2008 and 2009 the return on total equity for the two year was negative after improving in 2010 when the companys operations improved.
Gross profit margin

2006 Gross profit margin 9.77 2007 0.084 2008 8.05% 2009 12.14 2010 12.39
Conforming to the industry standards because of changes in the process of textile products the gross profit margin increased after 2007. In 2007 the significant decrease was due to increase in cost of sales.
Earnings per Share

2006 Earnings per Share -0.48 2007 0.21 2008 -6.03 2009 -4.43 2010 4.07
This reflects the companys report of loss in the year 2008 and 2009.
Bhanero Textile Mills

2006 Days sales in 24.76 receivables 2007 39.26 2008 44.39 2009 43.34 2010 30.17
The ratio has increased from 2006 to 2009 after decreasing in 2010. This can be attributed to the increased number of sales on credit out of which a large portion could not be recovered.
Accounts Receivable turnover

2006 Accounts receivable turnover 15.59 2007 12.58 2008 8.67 2009 8.67 2010 11.27
The overall trend here is negative because the companys position in 2006 was fairly stronger after which it started deteriorating because the company increased its credit sales to boost the overall sales and thus the accounts receivable turnover decreased till 2009.

2006 Accounts receivable turnover in days 23.40 2007 29.01 2008 42.07 2009 42.08 2010 32.38
Similar to days sales in receivables this ratio is deteriorating till 2008 after which it reaches stability in 2009 before it starts improving. This can be attributed to a better credit policy on behalf of the company that increases sales as well as improves receivable collectability

2006 Days sales in inventory 96.38 2007 100.54 2008 114.44 2009 88.85 2010 89.09
It took a hit in 2008 but recovered strongly 2009 onwards.
Inventory turnover
2006 Inventory turnover 3.26 2007 4.25 2008 3.41 2009 3.73 2010 4.45
The overall trend for this ratio is positive with a minor setback in 2008 which was overcome. Overall the company performed close to the market leader.

2006 Inventory turnover in days 111.91 2007 85.88 2008 107.10 2009 97.86 2010 81.98
The company has been showing positive trends suggesting a better and effective way of managing its inventory.
Operating cycle
2006 Operating cycle 135.31 2007 114.89 2008 149.17 2009 139.94 2010 114.36
Except for the time period between 2007 and 2008 the operating cycle of the company is becoming shorter and conforming with the industry standards.
Current ratio
2006 Current ratio 0.85 2007 0.93 2008 0.96 2009 1.02 2010 1.07
It is increasing from 2006 to 2010 indicating that the company is increasing its ability to pay its current liabilities using current assets.
Acid-test ratio
2006 Acid-test ratio 0.19 2007 0.29 2008 0.27 2009 0.35 2010 0.30
The company is able to effectively manage its receivables and increase its cash equivalents. However, there is a slight decrease in the year 2010.
Cash ratio
2006 Cash ratio 0.02 2007 0.04 2008 0.01 2009 0.02 2010 0.03
The ratio is the highest in 2007 and lowest in 2008 where the firms cash reserves depleted after it started improving its position thereafter.
Debt ratio
2006 Debt ratio 0.38 2007 0.72 2008 0.71 2009 0.66 2010 0.53
The ratio shows an increase in 2007 which was due to increased short term borrowings secured after which the company developed its assets compared to its liabilities and the position started getting better.
Debt/Equity ratio
2006 Debt/Equity 1.57 2007 2.88 2008 2.65 2009 2.09 2010 1.20
With the exception of 2007 the creditors of the company are fairly protected and the firms debt paying ability is strengthening.
Net income margin

2006 Net income margin 6.49% 2007 5.27% 2008 2.87% 2009 2.63% 2010 9.02%
The companys margin was decreasing till 2009 because of the increased finance costs after which in 2010 its sales soared and net income margin reached 9.02%.

The company has improved its ability to utilize its total asset to produce net income 2006 onwards with only a slight and insignificant decrease in 2008.
Return on Assets
2006 Return on assets 5.06% 2007 3.81% 2008 1.88% 2009 2.48% 2010 13.37%
Return on assets was deteriorating until 2008 after which it increased slightly in 2009 and significantly in 2010 due to increased number of sales.

2006 Operating income margin 13.39% 2007 10.78% 2008 9.23% 2009 10.29% 2010 13.91%
The operating income margin is fairly stable but declining from 2006 to 2008 after which it started increasing.

The ratio has increased significantly from 2006 to 2010 indicating an increased ability of the company to utilizing its operating assets for its core line of business.

2006 Return on operating assets 10.34% 2007 18.75% 2008 16.72% 2009 21.84% 2010 39.97%
With the exception of 2008 where the net sales were comparatively lower the return on operating assets showed a positive trend.

2006 Return on total equity 20.3% 2007 15.56% 2008 7.25% 2009 8.54% 2010 35.37%
It declined from 20% in 2006 to 7% in 2008 after which it increased slightly and then soared to 35% which was the highest of the three companies in consideration.
Gross profit margin

2006 Gross profit margin 15.8% 2007 13.53% 2008 11.78% 2009 13.12% 2010 17.69%
The gross profit margin decreased but not as significantly as it rose after 2008. The changes were due to increase in the prices of the textile products.
Earnings per Share

2006 Earnings per share 45.86 2007 41.26 2008 21.30 2009 26.96 2010 140.61
The most the earning per share the more attractive it becomes for the investor. As the company performed tremendously in 2010 the earnings per share also increased dramatically.
Earnings per share
160 140 120 100 80 Earnings per share 60 40 20 0 2006 2007 2008 2009 2010
Ratio analysis- Nishat Mills

2006 Days sales in receivables 31.882 days 2007 24.53 days 2008 32.186 days 2009 24.82 days 2010 32.01 days

35 30 25 20 15 10 5 0 2006 2007 2008 2009 2010 Days sales in receivables

2006 Accounts receivable turnover 12.16 times 2007 13.27 times 2008 13.50 times 2009 14.09 times 2010 14.34 times

15 14.5 14 13.5 13 12.5 12 11.5 11 2006 2007 2008 2009 2010 Accounts receivable turnover

2006 Accounts receivable turnover in days 30.01 days 2007 27.49 days 2008 27.03 days 2009 25.90 days 2010 25.40 days

31 30 29 28 27 26 25 24 23 2006 2007 2008 2009 2010 Accounts receivable turnover in days

2006 Days sales in inventory 80 days 2007 79.09 days 2008 91.89 days 2009 76.53 days 2010 86.56 days

100 90 80 70 60 50 40 30 20 10 0 2006 2007 2008 2009 2010
Inventory turnover
2006 Inventory turnover 4.64 times 2007 4.69 times 2008 4.52 times 2009 4.73 times 2010 5.03 times
Inventory turnover
5.1 5 4.9 4.8 4.7 4.6 4.5 4.4 4.3 4.2 2006 2007 2008 2009 2010 Inventory turnover

2006 Inventory turnover in days 78.59 days 2007 77.78 days 2008 80.732 days 2009 77.19 days 2010 72.51 days

82 80 78 76 74 72 70 68 2006 2007 2008 2009 2010 Inventory turnover in days
Operating cycle
2006 Operating cycle 108.6 days 2007 105.27 days 2008 107.73 days 2009 103.09 days 2010 97.91 days
Operating cycle
110 108 106 104 102 100 98 96 94 92 2006 2007 2008 2009 2010 Operating cycle
Current ratio
2006 Current ratio 1.38 2007 1.74 2008 1.19 2009 0.86 2010 1.11
Current ratio
2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2006 2007 2008 2009 2010
Current ratio
Acid-test ratio
2006 Acid-test ratio 1.35 2007 1.22 2008 0.76 2009 0.33 2010 0.42
Acid-test ratio
1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2006 2007 2008 2009 2010 Acid-test ratio
Cash ratio
2006 Cash ratio 0.624 2007 1.07 2008 0.61 2009 0.16 2010 0.16
Cash ratio
1.2 1 0.8 0.6 Cash ratio 0.4 0.2 0 2006 2007 2008 2009 2010
Debt ratio
2006 Debt ratio 0.32 2007 0.24 2008 0.51 2009 0.39 2010 0.32
Debt ratio
0.6 0.5 0.4 0.3 Debt ratio 0.2 0.1 0 2006 2007 2008 2009 2010
Debt/equity ratio
2006 Debt/equity ratio 0.48 2007 0.31 2008 0.51 2009 0.63 2010 0.47
Debt/equity ratio
0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2006 2007 2008 2009 2010 Debt/equity ratio
Net income margin

2006 Net income margin 10.7% 2007 10.59% 2008 6.94% 2009 6.54% 2010 10.42%
Net income margin

12.00% 10.00% 8.00% 6.00% Net income margin 4.00% 2.00% 0.00% 2006 2007 2008 2009 2010
Total asset turnover


0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2006 2007 2008 2009 2010 Total asset turnover
Return on assets
2006 Return on assets 6.15% 2007 4.78% 2008 3.31% 2009 3.53% 2010 7.51%
Return on assets
8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 2006 2007 2008 2009 2010 Return on assets

2006 Operating income margin 12.1% 2007 12.03% 2008 11.65% 2009 12.60% 2010 13.99%

16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 2006 2007 2008 2009 2010 Operating income margin


3 2.5 2 1.5 1 0.5 0 2006 2007 2008 2009 2010 Operating asset turnover

2006 Return on operating assets 20.1% 2007 19.50% 2008 21.14% 2009 26.54% 2010 38.31%

45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 2006 2007 2008 2009 2010 Return on operating assets

2006 Return on total equity 9.63% 2007 6.62% 2008 4.64% 2009 5.53% 2010 11.50%

14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 2006 2007 2008 2009 2010 Return on total equity
Gross profit margin

2006 Gross profit margin 16.54% 2007 16.56% 2008 15.41% 2009 18.23% 2010 18.96%
Gross profit margin

20.00% 18.00% 16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 2006 2007 2008 2009 2010
Gross profit margin
Earning per share

2006 Earnings per share 10.22 2007 7.58 2008 36.86 2009 6.23 2010 10.50
Earning per share

40 35 30 25 20 15 10 5 0 2006 2007 2008 2009 2010 Earning per share
Trends within industry

2006 2007 24.53 19.51 39.26 2008 32.186 23.20 44.39 2009 24.82 31.79 43.34 2010 32.01 21.72 30.17
Nishat Ahmad Hassan Bhanero

50 45 40 35 30 25 20 15 10 5 0 2006
31.882 20.20 24.76
Days sales in receivables Nishat Days sales in receivables Ahmad Hassan Days sales in receivables Bhanero
2007
2008
2009
2010
2006
2007 13.27 19.08 12.58
2008 13.50 18.18 8.67
2009 14.09 13.654 8.67
2010 14.34 15.41 11.27
12.16 17.63 15.59
25
20 Accounts receivable turnover Nishat Accounts receivable turnover Ahmad Hassan Accounts receivable turnover Bhanero
15
10
0 2006 2007 2008 2009 2010
2006
2007 27.49 19.15 29.01
2008 27.03 20.07 42.07
2009 25.90 26.73 42.08
2010 25.40 23.68 32.38
30.01 20.69 23.40
45 40 35 30 25 20 15 10 5 0 2006 2007 2008 2009 2010 Accounts Receivable turnover in days Nishat Accounts Receivable turnover in days Ahmad Hassan Accounts Receivable turnover in days Bhanero
2006
2007 79.09 78.99 100.54
2008 91.89 90.50 114.44
2009 76.53 104.53 88.85
2010 86.56 75.70 89.09
80.0 86.07 96.38
140 120 100 80 60 40 20 0 2006 2007 2008 2009 2010 Days sales in inventory Nishat Days sales in inventory Ahmad Hassan Days sales in inventory Bhanero
2006
2007 4.69 times 4.59 4.25
2008 4.52 times 4.66 3.41
2009 4.73 times 3.78 3.73
2010 5.03 times 4.56 4.45
Inventory turnover
Inventory turnover
4.64 times 4.55 3.26
6 5 4 3 2 1 0 2006 2007 2008 2009 2010
Inventory turnover Nishat Inventory turnover Ahmad Hassan Inventory turnover Bhanero
2006
2007 77.78 79.57 85.88
2008 80.732 78.33 107.10
2009 77.19 96.50 97.86
2010 72.51 80.03 81.98
78.59 80.26 111.91
120 100 80 60 40 20 0 2006 2007 2008 2009 2010
Inventory turnover in days Nishat Inventory turnover in days Ahmad Hassan Inventory turnover in days Bhanero
2006
2007 105.27 98.72 114.89
2008 107.73 98.4 149.17
2009 103.09 123.23 139.94
2010 97.91 103.98 114.36
Operating cycle
Operating cycle

160 140 120 100 80 60 40 20 0 2006
108.6 100.95 135.31
Operating cycle Nishat Operating cycle Ahmad Hassan Operating cycle Bhanero
2007
2008
2009
2010
2006
2007 1.74 0.82 0.93
2008 1.19 0.67 0.96
2009 0.86 0.76 1.02
2010 1.11 0.73 1.07
Current ratio
Current ratio

2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2006
1.38 0.85 0.85
Current ratio Nishat Current ratio Ahmad Hassan Current ratio Bhanero
2007
2008
2009
2010
2006
2007 1.22 0.17 0.29
2008 0.76 0.14 0.27
2009 0.33 0.18 0.35
2010 0.42 0.16 0.30
Acid-test ratio
Acid-test ratio

1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2006
1.35 0.16 0.19
Acid-test ratio Nishat Acid-test ratio Ahmad Hassan Acid-test ratio Bhanero
2007
2008
2009
2010
2006
2007 1.07 0.026 0.04
2008 0.61 0.0075 0.01
2009 0.16 0.001 0.02
2010 0.16 0.00087 0.03
Cash ratio
Cash ratio
0.624 0.011 0.02
1.2 1 0.8 0.6 0.4 0.2 0 2006 2007 2008 2009 2010 Cash ratio Nishat Cash ratio Ahmad Hassan Cash ratio Bhanero
2006
2007 0.24 0.80 0.72
2008 0.51 0.71 0.71
2009 0.39 0.74 0.66
2010 0.32 0.703 0.53
Debt ratio
Debt ratio
0.32 0.78 0.38
0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2006 2007 2008 2009 2010 Debt ratio Ahmad Hassan Debt ratio Bhanero Debt ratio Nishat
2006
2007 0.31 4.02 2.88
2008 0.51 7.19 2.65
2009 0.63 8.49 2.09
2010 0.47 6.73 1.20
debt/equity ratio
Debt/Equity ratio
0.48 3.5 1.57
9 8 7 6 5 4 3 2 1 0 2006 2007 2008 2009 2010 Debt/Equity ratio Ahmad Hassan Debt/Equity ratio Bhanero Debt/Equity ratio Nishat
2006
2007 10.59% 0.13% 5.27%
2008 6.94% -0.041% 2.87%
2009 6.54% -1.93% 2.63%
2010 10.42% 1.7% 9.02%
Net income margin
Net income margin
10.7% 1.42% 6.49%
12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% -2.00% -4.00% 2006 2007 2008 2009 2010 Net income margin Nishat Net income margin Ahmad Hassan Net income margin Bhanero
2006
2007 0.49 1.22 1.08
2008 0.50 0.89 1.02
2009 0.67 0.093 1.16
2010 0.81 1.17 1.50
0.61 1.25 0.98
1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2006 2007 2008 2009 2010 Total Asset Turnover Nishat Total Asset Turnover Ahmad Hassan Total Asset Turnover Bhanero
2006
2007 4.78% 0.174% 3.81%
2008 3.31% -3.02% 1.88%
2009 3.53% -2.189% 2.48%
2010 7.51% 2.03% 13.37%
Return on assets
Return on Assets
6.15% -0.40% 5.06%
16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% -2.00% -4.00% 2006 2007 2008 2009 2010 Return on Assets Ahmad Hassan Return on Assets Bhanero Return on Assets Nishat
2006
2007 12.03% 6.205% 10.78%
2008 11.65% 3.31% 9.23%
2009 12.60% 8.913% 10.29%
2010 13.99% 8.38% 13.91%
12.1% 7.4% 13.39%
16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 2006 2007 2008 2009 2010 Operating income margin Nishat Operating income margin Ahmad Hassan Operating income margin Bhanero
2006
2007 1.62 0.195 1.71
2008 1.82 1.27 1.81
2009 2.10 1.379 2.12
2010 2.74 1.88 2.87

3.5 3 2.5 2 1.5 1 0.5 0 2006 2007
1.67 2.074 0.77
Operating asset turnover Nishat Operating asset turnover Ahmad Hassan Operating asset turnover Bhanero
2008
2009
2010
2006
2007 19.50% 12.10% 18.75%
2008 21.14% 12.19% 16.72%
2009 26.54% 12.29% 21.84%
2010 38.31% 15.7% 39.97%
20.1% 15.34% 10.34%
45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 2006 2007 2008 2009 2010 Return on operating assets Nishat Return on operating assets Ahmad Hassan Return on operating assets Bhanero
2006
2007 6.62% 0.84% 15.56%
2008 4.64% -30.7% 7.25%
2009 5.53% -23.61% 8.54%
2010 11.50% 23.03% 35.37%

40.00% 30.00% 20.00% 10.00% 0.00% 2006
9.63% 1.76% 20.3%
Return on total equity Nishat Return on total equity Ahmad Hassan Return on total equity Bhanero
2007
2008
2009
2010
-10.00% -20.00% -30.00% -40.00%
2006
2007 16.56% 0.084 13.53%
2008 15.41% 8.05% 11.78%
2009 18.23% 12.14 13.12%
2010 18.96% 12.39 17.69%
Gross profit margin
Gross profit margin
16.54% 9.77 15.8%
20.00% 18.00% 16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 2006 2007 2008 2009 2010 Gross profit margin Nishat Gross profit margin Ahmad Hassan Gross profit margin Bhanero
2006
2007 7.58 0.21 41.26
2008 36.86 -6.03 21.30
2009 6.23 -4.43 26.96
2010 10.50 4.07 140.61
Earnings per share
Earnings per Nishat Share Ahmad Hassan Bhanero

160 140 120 100 80 60 40 20 0 -20 2006
10.22 -0.48 45.86
Earnings per Share Nishat Earnings per Share Ahmad Hassan Earnings per Share Bhanero
2007
2008
2009
2010
conclusion
Set backs for textile sector
Government
abolished R&D programs Implementation of 18% Value Added Tax Decline in machinery imports due to enhanced interests on loans
Global financial and economic crisis- 2008 Increased competition in international market Depreciation of rupee Short fall of power supply

Ratio Analysis Textile Industry

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RATIO ANALYSIS- TEXTILE INDUSTRY

Hassan Textile Mills Bhanero Textile Mills Nishat Mills Limited

Ratio Analysis Comparison of the companies Conclusion

Textile sector of Pakistan

Textile sector of Pakistan

Textile sector of Pakistan

exports to $24.36 billion

Introduction of companies- Ahmad Hassan Textile Mills

Introduction of companies- Ahmad Hassan Textile Mills

Main business type- exporter Major importers of its yarn

Introduction of companies- Bhanero Textile Mills

Introduction of companies- Bhanero Textile Mills

textile mills Faisal spinning mills ltd Blessed textiles ltd

yarn High and medium end cotton products

Introduction of companies- Bhanero Textile Mills

Introduction of companies- Nishat Mills Limited

Introduction of companies- Nishat Mills Limited

fabrics Cotton yarn Textile all sorts

Ahmad Hassan Textile Mills

Accounts Receivable turnover

Accounts receivable turnover

Accounts Receivable turnover in days

Accounts receivable turnover in days

Days sales in inventory

Inventory turnover in days

Net income margin

Total Asset Turnover

Operating income margin

Operating asset turnover

Return on operating assets

Return on total equity

Gross profit margin

Earnings per Share

Bhanero Textile Mills

Accounts Receivable turnover

Accounts Receivable turnover in days

Days sales in inventory

It took a hit in 2008 but recovered strongly 2009 onwards.

Inventory turnover in days

Net income margin

Total Asset Turnover

Operating income margin

Operating asset turnover

Return on operating assets

Return on total equity

Gross profit margin

Earnings per Share

Ratio analysis- Nishat Mills

Days sales in receivables

Accounts receivable turnover

Accounts receivable turnover

Accounts receivable turnover in days

Accounts receivable turnover in days

Days sales in inventory

Days sales in inventory

Days sales in inventory

Inventory turnover in days

Inventory turnover in days

Net income margin

Net income margin

Total asset turnover

Total asset turnover

Operating income margin