Oil Search Investment Portfolio Analysis
Added on 2020-05-28
16 Pages3257 Words80 Views
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Running head: FINANCE FOR BUSINESS - MASTERSFinance for business – MastersName of the studentName of the universityAuthor note
1FINANCE FOR BUSINESS - MASTERS Table of Contents1.Description of company......................................................................................................22.Structure of ownership governance....................................................................................23.Key ratios............................................................................................................................34.Information derived from the website of ASX...................................................................55.Recent announcements.......................................................................................................86.Stock field...........................................................................................................................97.Weighted average cost of capital........................................................................................98.Debt ratio..........................................................................................................................119.Dividend policy.................................................................................................................1210.Recommendation...........................................................................................................12Reference..................................................................................................................................14
2FINANCE FOR BUSINESS - MASTERS 1.Description of company Oil Search Limited, the biggest gas and oil exploration companies was incorporated inthe Papua New Guinea and operates under the oilfields of Papua New Guinea (PNG). Thecompany was established in the year 1929. Under PNG, the company holds more than 98%of assets and it holds extensive exploration and appraisal portfolio. The company has clearstrategy for driving the future growth. Further, the company is pursuing the opportunities fordeveloping the additional LNG for providing trainings in PNG (Oilsearch 2017). Thecompany is involved for liquefying the natural gas production and the developments of itthrough the interest in LNG PNG projects that is operated by PNG Limited. The company hasthree main products; these are – gas, oil and liquefied natural gas (LNG). The companyoperates 3 units for the business that involves PNG gas and oil, LNG PNG products andMiddle East and North America (MENA) 2.Structure of ownership governance i.Substantial ownershipMore than 20% shareholding – no shareholders are there in the company who isholding more than 20% of shares.More than 5% shareholding – International Petroleum Invt. Co. PJSC (InvestmentManagement) is holding 12.9% shares in the company and Npcp Investment Ltd isholding 9.80% shares in Oil Search Limited.ii.Name of key personnelChairman - Mr RJ LeeBoard membersMr PR Botten – Managing directorMr G Aopi – Executive director
3FINANCE FOR BUSINESS - MASTERS Sir KG Constantinou – Non-Executive directorDr EJ Doyle – Non-Executive directorMs FE Harris – Non –executive DirectorDr AJ Kantsler – Non-Executive directorMr B Philemon – Non-Executive DirectorMr KW Spence – Non-Executive DirectorDr ZE Switkowski – Non-Executive DirectorMr MP Togolo – Non-Executive DitectorCEO – Mr PR BottenMore than 20% shareholding – as none of the above mentioned key personnel areholding more than 5% or more than 20% shares in the company they do not fall underthe category of substantial shareholders. 3.Key ratios i. Return on assets (ROA) = (NPAT / Total Assets)Return on Equity (ROE) = (Net profit after tax / Ordinary equity)RatioFormula2016201520142013Return on assetsNAPT / Total asset0.009-0.0040.0330.024Return on equityNPAT / Ordinary equity0.019-0.0080.0700.060 Debt ratio = Total liabilities / Total assetsDebt ratio Total liabilities / Total assets0.5330.5450.5330.594EBIT/TA * NPAT/EBIT * TA/OE = NPAT/OE
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