Financial Evaluation of Manhattan Corporation Limited

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Name:
Usman Ali Butt
Student ID:
VSS30407

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Contents
Introduction.......................................................................................................................3
Company description........................................................................................................3
Ownership governance structure......................................................................................3
Performance ratios............................................................................................................4
Changes in stock price......................................................................................................6
Changes in the stock price................................................................................................7
Calculation of CAPM and beta values..............................................................................8
WACC calculations..........................................................................................................8
Debt ratios.........................................................................................................................9
Dividend policy..............................................................................................................10
Recommendation and Conclusion..................................................................................10
References.......................................................................................................................11
Appendix.........................................................................................................................12

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Introduction:
Financial evaluation is a procedure to measure various financial projects, businesses,
budgets etc to evaluate the financial position of the organization. This process calculates the
viability of the project and helps the stakeholders of the company to reach over an improved
conclusion. Basically, this procedure is conducted by the professionals to examine that
whether the performance of the company is stable, profitable, solvent, liquid, adequate etc.
Financial evaluation could be done through various methods and theories to measure the
position of the company such as governance structure of the company, changes in the board
of directors of the company, performance ratios, stock price evaluation, correlation, beta, debt
ratios, dividend policies etc.
This report has been prepared to evaluate the financial performance and the changes
into financial structure of the MANHATTAN CORPORATION LIMITED in past few years.
For the report, various aspects related to internal and external financial position of the
company has been evaluated such as governance structure of the company, changes in the
board of directors of the company, performance ratios, stock price evaluation, correlation,
beta, debt ratios and dividend policies.
Company description:
MANHATTAN CORPORATION LIMITED explores, develops and evaluates the
mineral projects and the mines of Australia. Mainly the company performs its operations in
exploring the Uranium. The flagship project of the company is Ponton project which
approximately covers 520 square kilometres of exploration tenements. These mines are
situated in Gunbarrel Basin, Western Australia. The main office of the company is in Perth,
Australia. The financial position and the market position of the company is enhancing due to
its projects and the performance in the market (Bloomberg, 2018).
Structure of Ownership governance:
For evaluating the financial position of MANHATTAN CORPORATION LIMITED,
study has been conducted over corporate governance policies of the company. In this report,
the main stakeholders of the company who has more than 20% of stock of the company have
been evaluated and at the same time, main members of the company such as chairman, CEO,
board members etc of the company has been evaluated.

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Substantial stakeholders:
The main stakeholders of the company has been evaluated and it has been found that
Minvest Securities (NZ) limited is the main stakeholder of the company which held around
170.5% of total stock of the company (Reports, 2018). The given table holds the name of top
20 shareholders of the company who has invested their amount for the operations of the
company:
(annual report, 2017)
Main people:
More to it, chief people of the company have been found. The chief of the company
is Alan J Eggers who administers the entire operations of the company and he is the executive
chairman of the company. Marcello Cardaci and John A G Seton is the non executive director
of the company. Out of all the board of members and the chief members of the company does
not have equal to or more than 20% share on the stock of the company? More, it has been
found that the Alan J Eggers has 6.69% holdings in the company. The above evaluation

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express that most of the abetment of the company is from other companies and the
individuals.
Performance ratios:
Performance ratios are the part of financial evaluation of an organization. These ratios
take the concern of main financial figures of the company and evaluate the financial position
of the company on the basis of that figures. It helps the comany to compare the operations
and the profitability with other competitive company to evaluate the market position of the
company.
Return on asset:
Return on assets (ROA) is a performance measurement ratio which explain about the
total profit of the company which has been earn by the company in comparison with the total
asset of the company (Sherman, 2005). Below given table express about the return on assets
of MANHATTAN CORPORATION LIMITED:
A. Return on assets= NPAT/ total Assets
(2800)/3198
-87.555%
The above table depict that the ROA of the company is -87.55% which is expressing
about a bad position and the performance of the company. It explains that the company is
suffering from loss and the company should make changes into its policies to reach over a
profitability level.
Return on equity:
Return on equity (ROE) is a performance measurement ratio which explain about the
total profit of the company which has been earn by the company in comparison with the total
equity of the company. Below given table express about the return on equity of
MANHATTAN CORPORATION LIMITED:
B. Return on Equity=
Net profit after tax/
ordinary equity
(2800)/17629
-15.88%
(Morningstar, 2018)

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The above table depict that the ROE of the company is -15.88% which is expressing
about a bad position and the performance of the company. It explains that the company is
suffering from loss and the company should make changes into its policies to reach over a
profitability level.
Debt ratios:
Debt ratio is a performance measurement ratio which explains about the total
liabilities of the company which has been maintained by the company in comparison with the
total assets of the company (Tucker, 2011). Below given table express about the debt ratios of
MANHATTAN CORPORATION LIMITED:
C. Debt Ratios =
Total Liabilities/ total
assets
77/3198
2.41%
The above table depict that the debt ratios of the company is 2.41% which is
expressing about a bad capital structure position of the company. It explains that the company
should enhance the level of the liabilities and should raise the funds through short term and
long term debt funds.
TA/OE:
TA/ TE also expresses about the performance ratios and the profitability position of
the company. This ratio expresses that the better the level of the resources of the company
would be the better the profitability position of the company would be as most of the part of
profits are spent by the companies to manage the resources (Tucker, 2011).
ROA and ROE:
Here, the ROE of the company is -15.88% and the ROA of the company is -87.55%
which explains that the ROE is lesser than the ROA of the company. The ROA is always
greater than ROE due to the reason that assets are always greater in an organization as the
asset is the combination of the liabilities and the equity of the company (Bromwich and
Bhimani, 2005).
Changes in stock price: