Financial Analysis of Seafarms Group Limited: A Comprehensive Evaluation

Finance for business
1

Table of Contents
Introduction:..................................................................................................................................3
1. Prepare a brief description of the company............................................................................4
2. Specify ownership-governance structure of the company.....................................................5
3. Calculate the following Fundamental ratios for your selected company for the past 2
years................................................................................................................................................7
4. Prepare a graph/chart for movements in the monthly share price over the last two years
.......................................................................................................................................................10
5. Significant announcements which may have influenced the share price of your company.
.......................................................................................................................................................12
6. Financial data of company:.....................................................................................................14
7. Weighted average cost of capital............................................................................................15
8. The debt ratio of the company................................................................................................17
9. Dividend Policy........................................................................................................................18
10. Letter of recommendation....................................................................................................19
Conclusion....................................................................................................................................20
References:...................................................................................................................................21
2

Introduction:
The report is prepared for analyzing and evaluating the financial position of the company
“Business”. It is an Australian agricultural company which started its operations in 1988. The
annual report for the company for 2017 has been used to make judgments. The aim of the project
is to analyse the financial position by using financial ratios, effect of Australian Securities
Exchange (ASX) announcements on the share price to predict future of the share value,
calculation of beta values and Capital Asset Pricing Model (CAPM), debt ratios and dividend
policy of the firm have been analysed to predict the future performance of the firm. Then this
information will be used to decide whether the company is worth investing or not.
3

1. Prepare a brief description of the company.
Business is one of the leading companies in its industry which started its operation in 1988. It’s
one of the major activities include producing prawn which is used by both Australian and
international customers. It sells them under the brand Crystal Bay Prawns®. The company has
seen a whopping 43 % compounded annual growth over the last 4 years, which makes the
company largest prawn farmer in Australia. Along with this CO2 Australia, another subsidiary of
the company is one of the leading environmental services company (Seafarms Group Limited,
2017).
4

2. Specify ownership-governance structure of the company.
Substantial shareholders of the company:
These are the shareholders who own a significant number of shares in the company. This
ownership helps them to have a say in company’s decision-making process. Seafarms Group
Limited substantial shareholders are listed below -
With higher than 20% of shareholdings –
With reference to the information provided by the company for the year ended 2017, the
Business only has one substantial shareholder who holds more than 20 % of the share capital –
Gabor Holding Pty Ltd and associates with holdings worth 453,391,227 (32.30%) shares.
As no individual family has a substantial shareholding in the Seafarms Group Limited it can be
said that it is a non-family company. So, the company is an independent company.
With higher than 5% of shareholdings – There are no shareholders holding more than 5 %
shares and there is only one substantial shareholder, mentioned above
Main people of corporate governance:
 The Chairman = Mr. Ian Norman Trahar
 Board members = The details regarding the Board of directors of the
Business is mentioned below
Name Position
Mr. Harley Ronald Whitcombe Chief Financial Officer, Company
Secretary, Executive Director
5

Mr. Ian Norman Trahar Executive Chairman, Executive Director
Dr, Christopher David Mitchell Executive Director
Mr. Paul John Favretto Non-Executive Director
 CEO = There is no position of CEO
No, none of these people have the same surname as any of the substantial shareholder, who is
holding more than 20 % shares in the company. No, there is no individual with more than 5 %
shares involved in the governance of the firm.
6