Income statement 2018 2019 2020

Product Sales 21,049 23,565 25,890

Collaboration Revenue 1,041 819 727
Total Revenue 22,090 24,384 26,617
Cost of sales (4,936) (4,921) (5,299)
Gross profit 17,154 19,463 21,318
Distribution costs (331) (339) (399)
Research and development expense (5,932) (6,059) (5,991)
Selling, general and administrative costs (10,031) (11,682) (11,294)
Other operating income and expense 2,527 1,541 1,528
Operating profit 3,387 2,924 5,162
Finance income 138 172 87
Finance expense (1,419) (1,432) (1,306)
Share of after tax losses in associates and joint ventures (113) (116) (27)
Profit before tax 1,993 1,548 3,916
Taxation 57 -321 -772
Profit for the period 2,050 1,227 3,144
Basic EPS 1.70 1.03 2.44
-1% -1% -1% -2%
-25% -23% -26% -23%
-48% -42% -50% -44%
6% 6% 7% 6%
12% 19% 12% 20%
Balance sheet 2018
Assets
Non-current assets
Property, plant and equipment 7,421
Right-of-use assets -
Goodwill 11,707
Intangible assets 21,959
Investments in associates and joint ventures 89
Other investments 833
Derivative financial instruments 157
Other receivables 515
Deferred tax assets 2,379
45,060
Current assets
Inventories 2,890
Trade and other receivables 5,574
Other investments 849
Derivative financial instruments 258
Income tax receivable 207
Cash and cash equivalents 4,831
Assets held for sale 982
15,591
Total assets 60,651
Liabilities Current liabilities
Interest-bearing loans and borrowings (1,754)
Lease liabilities -
Trade and other payables (12,841)
Derivative financial instruments (27)
Provisions (506)
Income tax payable (1,164)
(16,292)
Non-current liabilities
Interest-bearing loans and borrowings (17,359)
Lease liabilities -
Derivative financial instruments (4)
Deferred tax liabilities (3,286)
Retirement benefit obligations (2,511)
Provisions (385)
Other payables (6,770)
(30,315)
Total liabilities (46,607)
Net assets 14,044
Equity
Capital and reserves attributable to equity holders of the Company
Share capital 317
Share premium account 4,427
Capital redemption reserve 153
Merger reserve 448
Other reserves 1,440
Retained earnings 5,683
12,468
Non-controlling interests 1,576
Total equity 14,044
 2019 2020

7,688 8,251
647 666
11,668 11,845
20,833 20,947
58 39
1,401 1,108
61 171
740 720
2,718 3,438
45,814 47,185

3,193 4,024
5,761 7,022
849 160
36 142
285 364
5,369 7,832
70 -
15,563 19,544
61,377 66,729

(1,822) (2,194)
(188) (192)
(13,987) (15,785)
(36) (33)
(723) (976)
(1,361) (1,127)
(18,117) (20,307)

(15,730) (17,505)
(487) (489)
(18) (2)
(2,490) (2,918)
(2,807) (3,202)
(841) (584)
(6,291) (6,084)
(28,664) (30,784)
(46,781) (51,091)
14,596 15,638
 328 328
7,941 7,971
153 153
448 448
1,445 1,423
2,812 5,299
13,127 15,622
1,469 16
14,596 15,638

1 23.44%
2
 2018 2019
Cash flows from operating activities
1,993 1,548
Profit before tax
Finance income and expense 1,281 1,260
Share of after tax losses of associates and joint ventures 113 116
Depreciation, amortisation and impairment 3,753 3,762
Increase in trade and other receivables (523) (898)
Increase in inventories (13) (316)
Increase/(decrease) in trade and other payables and provisions (103) 868
Gains on disposal of intangible assets (1,885) (1,243)
Fair value movements on contingent consideration arising from business (495) (614)
combinations
Non-cash and other movements (290) 378
Cash generated from operations 3,831 4,861
Interest paid (676) (774)
Tax paid (537) (1,118)
Net cash inflow from operating activities1 2,618 2,969
Cash flows from investing activities
(349) (709)
Payment of contingent consideration from business combinations
Purchase of property, plant and equipment (1,043) (979)
Disposal of property, plant and equipment 12 37
Purchase of intangible assets (328) (1,481)
Disposal of intangible assets 2,338 2,076
Movement in profit-participation liability – 150
Purchase of non-current asset investments (102) (13)
Disposal of non-current asset investments 24 18
Movement in short-term investments, fixed deposits and other investing 405 194
instruments
Payments to associates and joint ventures (187) (74)
Interest received 193 124
Net cash (outflow)/inflow from investing activities 963 (657)
Net cash inflow before financing activities 3,581 2,312
Cash flows from financing activities
34 3,525
Proceeds from issue of share capital
Issue of loans 2,971 500
Repayment of loans (1,400) (1,500)
Dividends paid (3,484) (3,592)
Hedge contracts relating to dividend payments (67) 4
Repayment of obligations under leases – (186)
Movement in short-term borrowings (98) (516)
Net cash outflow from financing activities (2,044) (1,765)
Net increase in Cash and cash equivalents in the period 1,537 547
Cash and cash equivalents at the beginning of the period 3,172 4,671
Exchange rate effects (38) 5
Cash and cash equivalents at the end of the period 4,671 5,223
 2020
3,916
1,219
27
3,149
(739)
(621)
1721
(1,030)
(272)

-276
7,094
(733)
(1,562)
4,799

(822)
(961)
106
(1,645)
951
40
(119)
1381
745
(8)
47
(285)
4,514
30
2968
(1,609)
(3,572)
-101
(207)
288
(2,203)
2311
5,223
12
7,546
 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
What proportion of total assets was funded by owners in 2020
What proportion of current assets was funded by suppliers in 2020
What proportion of liabilities need to be repaid within one year?
Wages paid to factory workers will be reflected in
Main source of improvement in Operating profit margin for FY 2020 is driven by
What is the EBITDA for the FY 2020
Which investing activity consumes the most cash
How much dividends were paid during the FY 2020
Why is Share of after tax losses of associates and joint ventures
On average how long does AZ take to collect cash from its customers
Inventory write-off
Provision for doubtful debt / Gross AR
Fixed asset turnover
What is the Gross PP&E as on 31/12/2020
What is the approximate average age of PP&E as on 31/12/2020
 Comments
23% SE / A
81% Trade & other payable / current assets
40% Current liabilities / total liabilities
Cost of sales
Reduction in SG&A
8,371
Purchase of intangible assets from statement of cash flows
3572 from statement of cash flows
There is no actual cash outflow
50.6765413081865 Refer note 16 for trade receivable data
149 Refer note 15
0.60% Refer note 16 for trade receivable data
3.34 3.33985820942343
16,067
11.34

NOTE 16 2020 2019

trade receivables 3829 3606
allowance -23 -21
3806 3585
average 3695.5
1 What proportion of total assets was funded by owners in 2020

Total equity 15638

Total assets 66,729
(Total Equity/ Total Assets)*100 23.44

2 What proportion of current assets was funded by suppliers in 2020

Trade and other payables 15785
Current assets 19544
(Trade and other payables/ Current assets)*100 80.8

3 What proportion of liabilities need to be repaid within one year?

Current Liabilities 20307
Total Liabilities 51091
Current Liabilities/Total liabilities 39.75

Wages paid to factory workers will be reflected in Cost of

4 sales

5 Main source of improvement in Operating profit margin for FY 2020 is driven by

Computing change in operating profit margin 2019
Total Revenue 24,384
Operating Profit 2,924
Change in operating profits 12
Change in gross profit margin
Gross Profit 19,463
Total Revenue 24,384
Change in gross profit margin 80

Selling, general, and administration expenses as a % of sales 

SGA (11,682)
Sales/Total Revenue 24,384
48
Change

Distribution Cost -339

Distribution Cost/Total Revenue 1.4
Change

Taxes 321
Taxes / Total revenue 1.3

6 What is the EBITDA for the FY 2020

Net income 3,144
interest expense 1,306
tax 772
Depriciation and amortization 3,149
8,371
 7 Which investing activity consumes the most cash
Items from investing activities in the cash flow statement
Payment of contingent consideration from business combinations 822
Purchase of property, plant and equipment 961
Purchase of intangible assets 1,645
Purchase of non-current asset investments 119
Payments to associates and joint ventures 8

8 How much dividends were paid during the FY 2020

Financing activity from cash flow statements 3,572

Share of after-tax losses of associates and joint ventures is added back to net income There is
while calculating cash flow from operations. Associates and Joint Ventures are entities
partly owned by AZ and other pharma companies in order to develop specific therapies no actual
and medicines. Which of the following could be the most plausible explanation.   cash
outflow
9
10 For this question, assume that Product sales and Collaboration revenue are all on credit
(that is, Trade receivables). Approximately how many days did AZ take to collect its trade
receivables in FY 2020?  

Refer to note 16 of Group financial statements 2019

Gross AR 3829
Prov for bad debts -23
Net AR 3806
Average AR 3695.5
Total Revenue for 2020 26,617
AR days = 365/(sales/avg AR) 51

For the FY 2020, what is the provision for doubtful debts as a percentage of gross trade
receivables? 
11
Provision/ Gross AR (Refer to note 16)
Gross AR for 2020 3606
Provision 21
Provison as a % of AR 0.6

12 What is the amount of inventory write-offs during the year ended 31/12/2020? 
Refer to footnotes under note 15 149

On average each dollar invested in Property, Plant & Equipment (PP&E) generates how
much total revenue in FY 2020?
13
Computing Total Revenue/ Average PPE
Total revenue for 2020
Compuing Average PPE
Opening PPE 7688
Closing 8251
Average PPE 7969.5
Total revenue/ Avg PPE 3.34

14 What is the value of Gross Property, Plant & Equipment as on 31/12/2020? 

Refer to note 7 first schedule 16067
 What is the approx. average age of  AZ’s Property, Plant & Equipment (considered as a
block) ?
15
Age of an asset = accumulated dep/ Dep for the year
Accumulated dep (Refer note 7 Depriciation Schedule) 7816
Dep for the year (Refer note 7 Depriciation Schedule) 689
Age of an asset = accumulated dep/ Dep for the year 11.3
 Change in %
2020
26,617
5,162
19

21,318
26,617
80 0

(11,294)
26,617
42
6

-399
1.5
0.1

772
2.9 1.6
2020
3606
-21
3585

26,617