Financial Ratio Analysis Example

This assignment delves into the analysis of financial ratios using data from several different companies. It presents calculated ratios covering liquidity, profitability, and solvency across different time periods. The example demonstrates how to interpret these ratios to assess a company's financial health and performance trends.

Financial decision making

Executive Summary
Management of financial resources assists the organization in achieving its long term
objectives. The study proposed herewith emphasizes on evaluating case for Singapore Airlines. It
is through adoption of various accounting and financial techniques that the performance of
Singapore Airlines is analyzed. The fundamental analysis that deals with evaluation of financial
statements is conducted herewith. It is through in-depth analysis of past performance that the
effectiveness of business unit is judged. Investors seem to make investment in equity of
businesses so as to earn sufficient amount of return. Henceforth, they should have deep
understanding of financial performance of the business unit. In present case, financial statements
of Singapore airlines have been analyzed in detail. It is found that the organization employs
around 23963 employees. The revenue of the company was $15.565 billion in the year 2014-
2015. The operating income of Singapore Airline at present is $442.9. From the analysis of the
profitability liquidity, stability ratios have determined that position of Singapore Airlines is
strong. It is seen that the business unit is earning sufficient amount of profitability. Moreover, the
organization is having sound liquidity and stability position. The airline industry has passed
through turmoil in recent past. However, in distinct set of circumstances Singapore airlines has
operated in an efficient manner. The company has also merged with different airlines brands.
This has assisted in increasing its profitability to a greater extent. Thus, the investors can plan
to invest in the firm. Through this, they can earn huge amount of profitability. It is suggested that
investors should make investment into the company for long-term. The fundamental analysis
helps in supporting investment decision for long-term. The analysis conducted in report suggests
that the Singapore airline is feasible option for investment purpose.
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TABLE OF CONTENTS
Introduction......................................................................................................................................1
Section A..........................................................................................................................................1
1. and 2. Introduction of selected company.................................................................................1
3. Horizontal and vertical analysis...............................................................................................3
4. Identification of profits............................................................................................................3
5. Identification of dividends.......................................................................................................4
6. Identification of stability and liquidity....................................................................................5
Section B..........................................................................................................................................6
1. Stating the information about the company's performance which place impact upon the
financial performance of Singapore.............................................................................................6
2. Critic about the company in the financial reports....................................................................7
3. Identifying the director as well as non executive director and there by assessing their role
within an organization.................................................................................................................7
4. Identifying the asset value per share and the current market share price................................8
Conclusion.......................................................................................................................................8
References........................................................................................................................................9
Appendix........................................................................................................................................11
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INTRODUCTION
Financial decision making is an essential activity of the business. It is important for the
firm to attain sustainability and long term growth. Management of financial resources assists the
organization in achieving its long term objectives (Hershey, Austin and Gutierrez, 2015). In
present report financial decision making has been discussed with respect to Singapore Airlines.
The study entails to understand key accounting as well as corporate governance concepts,
theories as tools which would assists in making critical analysis of the firm. Further, it
determines the profitability, liquidity as well as earning of the company. This would help in
developing sound decisions in advising the investors.
SECTION A
1. and 2. Introduction of selected company
Singapore Airlines Limited is flag carrier of Singapore with its hub at Changi airport. The
group involves airline related subsidiaries: SIA engineering company that manages repairs and
overhaul business across nine countries along with portfolio of 27 joint ventures. The firm was
founded in the year 1947 and further it commenced its operation in 1972. Headquarter of the
firm is at Airline house, Singapore. The number of employees working in the organization is
23963. The revenue of the company is $15.565 billion in 2014-2015. The operating income of
Singapore Airline at present is $442.9. Moreover, the net income of the company is $367.9.
Moreover, the organization covers 64 destinations across the globe (Singapore Airlines
Sustainability report, 2013/14). The fleet size of the company is 109. In flight, product and
services offered by the company involves cabins. Singapore Airlines grant five classes of
services which include suites, first class, business class, economy class and premium economy
class. The firm is also engaged in providing catering services. This involves offering wide range
of food options on each flight. In addition to this, company offers hop on bus which the bus
services offered to people at discounts (Pires and Fernandes, 2012). Singapore Airlines possesses
long standing program that has more than hundred vendors offering privileges to all SIA
passengers. As a global airline, Singapore airline is dedicated to provide air transportation
services in highest quality. Further the firm is maximizing returns in order to benefit the
shareholders as well as employees. With commitment to modernize fleet, innovation in product
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and services, market leadership, Singapore Airlines has emerged as one of the world's most
respected travel brands. At present Singapore Airlines is renowned as world's leading airline and
operates modern passenger fleet of greater than 100 aircraft.
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3. Horizontal and vertical analysis
Horizontal and vertical analysis of balance sheet and profit and loss account for last five
years has been enclosed in Appendix 1. Horizontal analysis lays emphasis on the changes in the
financial statement items over time. Through horizontal analysis users of financial statements
can determine the relative changes over time and determine positive or troubling trends.
In contrast to this vertical analysis is defined as common size analysis as such all the
amounts of given year are converted into percentages of key financial statement component.
Trend of sales, profit and assets as well as liabilities
Enclosed in appendix 2
Interpretation:
From the above graphical presentation it has been gained that sales of the Singapore
airlines is showing an upward trend but its profitability is demonstrating downtrend. This is due
to increase in the number of competitors that compels the firm to reduce the cost of its services
(Torlak and et. al., 2011).
In addition to this, the asset of the firm is increasing and liability is demonstrating
downward trend. This reflects stronger position of the company.
4. Identification of profits
a. As per the bureau of Economic Analysis, the real gross domestic product has increased by 4%
annually in the second quarter of 2014. Earlier this has decreased in the first quarter of 2014 by
2.1%. Through industrial growth, the rate of employment has also increased to a greater extent.
Further, this has resulted in greater disposable income (Graham, Harvey and Puri, 2015). The
global industry profit of $18.0 billion has been considered as an improving trend. Aviation has
been considered as catalyst for the economic growth. Various efforts have been made by airlines
with the aim to improve performance (Spencer, Buhalis and Moital, 2012). The industry has
suffered a lot in the previous year which includes global economic performance, passenger
trends, cargo trends and cost of fuel.
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b. and c.
Profitability ratio is a measure of profitability that assists in examining the performance
of the organization. It is the capacity of the firm to earn revenue after the deduction of costs and
expenses in relation with earning of income. Profitability ratio of Singapore Airline has been
enclosed in Appendix 3. From the analysis of profitability ratio it has been gained that operating
profit ratio, net profit ratio, return on shareholder's investment of the organization is increasing
significantly in the present year that is 2014-15. This presents that the firm possess the ability to
meet its expenses it an effective manner. By evaluating the profitability of the business it has
been determined that the sales of the company are increasing to a greater extent. This has
resulted in enhancing the overall performance of Singapore Airlines. During the past five years
there is not major difference in the values. However values differs slightly which has affected the
profitability position of the company. Further the total asset with the business is increasing this
implies that firm has potential to meet its contingencies for future in an effective manner.
5. Identification of dividends
a. and b.
In order to gain insight to the dividend of Singapore Airlines several ratios have been
calculated. This includes price earnings ratio, earning per share, dividend yield, dividend payout
ratio and dividend cover ratio. The dividend ratio has been enclosed in Appendix 4. From the
analysis of price earnings ratios it has been gained that such is increasing in case of Singapore
Airlines. It can be assessed that as the firm has higher price earnings ratio thus this implies
positive future performance if firm. Moreover the investors would be willing to pay more for the
shares of organization. Earnings per share ratio of the company have increased slightly in current
year as compared to previous year. This presents that firm is more profitable and possess greater
profits that can be distributed to its shareholders. Dividend yield ratio of the company can be
defined as financial ratio that measures the amount of cash dividends distributed to common
shareholders relative to the market value per share. For Singapore Airline dividend yield ratio is
decreasing this presents that firm is not making payment of large dividend to investors in
comparison with fair value of stock. The role of dividend payout ratio is very significant. It is
essential that this ratio demonstrates consistency rather than high and low trend. In case of
Singapore Airline there is downward trend which presents that company cannot afford to make
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payment of high dividend. This is as a result of poor operating performance. At last dividend
coverage ratio has been calculated which presents that ability of the firm to pay dividends out of
the profit attributable to shareholders. Dividend cover ratio of Singapore Airlines is below 1.5
thus it can be suggested that firm might not be able to maintain present level of dividends in
situation of adverse variation in profit in future.
6. Identification of stability and liquidity
a. The financial position of Singapore Airlines is sound. From the analysis carried above it has
been gained that profitability as well as sales of the firm are increasing. This assists the business
in gaining long term sustainability. In addition to this, company is able to achieve its growth
objectives in an effective manner (Anderson and et. al., 2015). With the increase in number of
services offered by company its number of customers has grown to a greater extent. This has
resulted in increasing sales of the organization as well. The assets of the firm have increased
whereas its liabilities have decreased greatly (Jenatabadi, 2015). This has raised the performance
of the firm and enhanced its capability to meet future expenses.
b. and c.
For the purpose of gaining insight to the liquidity and stability position of the
organization various ratios of Singapore Airlines have been calculated. This includes current
ratio, quick ratio, asset turnover and inventory turnover ratio. Such has been enclosed in
Appendix 5. The current ratio of firm assists creditors and investors in understanding liquidity of
the firm. This presents how easily business pay off its current liabilities. It has been determined
that current ratio sheds light on the overall debt burden of the organization. The current ratio of
company is decreasing which implies that its ability to pay current debts is declining. Quick ratio
of the company is effective in measuring the liquidity of the organization. The quick ratio of
Singapore Airlines is decreasing but it is more than 1. This implies that firm has ability to pay off
its current liabilities without selling any long term assets. Asset turnover ratio presents how
successfully firm uses its assets in order to generate revenue. Singapore Airlines has sound asset
turnover asset which demonstrates that firm is making effective utilization of its resources.
Times Company has sold its average inventory during a period. Such ratio is increasing for
Singapore Airlines which demonstrates increase in sales of the company.
Additional ratios have been enclosed in Appendix 6
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 Profitability ratios: From the analysis of the above ratios it has been gained that the
profitability of the company is increasing currently from last year. But still it represents
lesser improvement in comparison with the year 2010-11. Thus it is essential for the
organization to keep a track on its expenses. Activity ratios: Through this ratio it has been gained that company is making payment to
its creditors on time. Further it is receiving funds from debtors on time. This assists the
organization in meeting its needs to a significant level.
 Solvency ratios: It has been determined from the analysis that the company Singapore
Airline possesses the ability to meet its long term debt in an effective manner.
SECTION B
1. Stating the information about the company's performance which place impact upon the
financial performance of Singapore
Singapore Airlines have acquired Tigerair and Scoot Pte ltd. Tigerair offers services to
the regional destination in South Asia, China and India from its origin Singapore Changi Airport.
Singapore Airliner has offered entire shareholding of the unprofitable budget airline. In addition
to this, Scoot Pte Ltd is also acquired by Singapore airlines who offer services to the customer at
very low prices (Forbes and et. al., 2015). Singapore Airline has invested their money in the
growing unlisted premium airlines in order to increase its market share in all segment of the
market. Such acquisition has closely affected the financial performance of and organization.
After such acquisition, gross revenue of Singapore Airlines is showing increasing trend in
their performance. Through this acquisition, Singapore Airlines is able to serve the large number
of the customers. As company offers their service to wide customer base so they get synergies in
their financial performance. Besides this, by acquiring Tigerair and Scoot Pte ltd Company have
also acquired their customer base. It is also the main aspect behind increasing trend of gross
profit margin of an organization (Singapore Airlines reports higher profits but future outlook
hinges on Scoot & Tigerair improvements, 2015). In addition, expenditures of an organization
also decreased. This aspect clearly reflects that Singapore airlines enjoy the synergy of large
scale operations. It shows that acquisition have placed positive impact upon the financial
performance of Singapore Airlines.
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2. Critic about the company in the financial reports
On the basis of the financial reports of Singapore Airlines, it can be assessed that net
profitability aspect of the company shows consistency in their performance. Nevertheless, it
decreased in 2014 and 2015 as compared to 2012. This aspect states that company is required to
frame competent strategies and policies which help them in increasing their profitability aspect
with the high percentage (Zaimah and et. al., 2015). In addition to this, current ratio of an
organization shows fluctuating trend. As compared to the previous years in 2015, current ratio of
Singapore Airlines decreased. These aspects show that company does have the sufficient amount
of current assets to meet their current obligations.
Further, current ratio of an organization is far from the ideal ratio which is 2:1. Thus,
organization is required to make efforts to improve their liquidity aspects. Along with it,
dividend yield of a Singapore is decreasing which shows that profitability aspect of an
organization is not increasing with the high rate of percentage. Such critics may negatively
impact the investment decisions of the existing as well as potential shareholders. Thus,
organization needs to frame the cost effective strategies which enables them to improve their
profitability aspect with the high rate of percentage (Kauffman, Liu and Ma, 2015). Through this,
Singapore Airlines is able to build and sustain competitive advantage over others.
3. Identifying the director as well as non executive director and there by assessing their role
within an organization
Singapore Airlines have appointed Choong Phong Goh MS as a director of an
organization. Board of directors plays a crucial role in the growth and development of an
organization. Choong Phong Goh MS is the part of the board of directors’ team who makes the
mission, vision and values of an organization. In addition to this, they also frame strategies and
structure of an organization (Copur, 2015). Board of directors also delegates the authority of the
management and monitors their performance. Further, they also take responsibility to give fair
treatment to the shareholders as well as other stakeholders. All the above mentioned activities of
directors have high level of influence upon performance and operations of Singapore Airlines.
Besides this, Dr. Helmut Panke appointed as a non executive director of an organization.
They provide assistance to an organization in achieving success in the strategic business
environment. They have expertise in the field of the management. Besides this, they also play an
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important role in solving the problem which may arise in the future. Further, they also appoint
the board of directors of an organization as well as set their remuneration (Financial Decision
making and the Techniques used in Financial Analysis, n.d. [Pdf], 2015.). This aspect reflects
that non executive directors also have high level of influence upon the Singapore Airlines.
4. Identifying the asset value per share and the current market share price
Net asset value consists of the value of the assets after subtracting the values of liabilities
from it. It is the measure which helps the organization in assessing the financial health and
performance of an organization. On the basis of the financial statements it has been assessed that
in 2013 net asset value is 11.26 whereas in 2015 it is 10.66. This aspect shows decreasing trend
in the performance of an organization. It reflects that Singapore airlines have fewer amounts of
assets in comparison to the previous years (Wensveen, 2010). Thus, organization is required to
make efforts to improve their financial aspect. Through this, company is able to attract large
number of investors to make investment in the operations of the business organization.
CONCLUSION
From this project report it can be recommended to investors that they should make
investment in the business operations and functions of Singapore Airlines. As productivity and
profitability aspect of the corporation is increasing. This aspect clearly indicates that company
has enough amount of profit which they can distribute among the shareholders in the form of
dividend. In addition to this, earning per share also shows increasing trend. This is the positive
sign for the investors which attract them invest in the operations of Singapore Airlines. It can be
seen in the report that dividend yield shows fluctuating trend but management of Singapore
Airlines is very sound. Thus, investor will get dividend at very consistent rate by making
investment in the company. Further, government policies have positive influence upon Singapore
Airlines. On the basis of all the above mentioned aspects it is advised to the potential investors
that they need to invest money in Singapore Airlines and thereby take benefit from it.
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REFERENCES
Journals and Books
Anderson, D. and et. al., 2015. An introduction to management science: quantitative approaches
to decision making. Cengage Learning.
Copur, Z., 2015. Handbook of Research on Behavioral Finance and Investment Strategies:
Decision Making in the Financial Industry. IGI Global.
Forbes, W. and et. al., 2015. Which heuristics can aid financial-decision-making?. International
Review of Financial Analysis. 42. pp. 199-210.
Graham, J. R., Harvey, C. R. and Puri, M., 2015. Capital allocation and delegation of decision-
making authority within firms. Journal of Financial Economics. 115(3). pp. 449-470.
Hershey, D. A., Austin, J. T. and Gutierrez, H. C., 2015. Financial Decision Making across the
Adult Life Span: Dynamic Cognitive Capacities and Real-World Competence. Aging and
decision making: Empirical and applied perspectives. pp.329.
Jenatabadi, H. S., 2015. Knowledge Manager and Airline Performance Modeling. Available at
SSRN 2599158.
Kauffman, R. J., Liu, J. and Ma, D., 2015. Technology investment decision-making under
uncertainty. Information Technology and Management. 16(2). pp. 153-172.
Pires, H. M. and Fernandes, E., 2012. Malmquist financial efficiency analysis for airlines.
Transportation Research Part E: Logistics and Transportation Review. 48(5). pp. 1049-
1055.
Spencer, A. J., Buhalis, D. and Moital, M., 2012. A hierarchical model of technology adoption
for small owner-managed travel firms: An organizational decision-making and leadership
perspective. Tourism Management. 33(5). pp. 1195-1208.
Torlak, G. and et. al., 2011. Analyzing business competition by using fuzzy TOPSIS method: An
example of Turkish domestic airline industry. Expert Systems with Applications. 38(4). pp.
3396-3406.
Zaimah, R. and et. al., 2015. Financial decision making among the dual-income families in
Malaysia. Mediterranean Journal of Social Sciences. 6(4). pp. 70.
Online
Financial Decision making and the Techniques used in Financial Analysis, n.d. [Pdf]. 2015.
Available through:<http://www.flexstudy.com/catalog/schpdf.cfm?coursenum=96088>.
[Accessed on 4th January 2016].
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Singapore Airlines reports higher profits but future outlook hinges on Scoot & Tigerair
improvements. 2015. [Online]. Available
through:<http://centreforaviation.com/analysis/singapore-airlines-reports-higher-profits-
but-future-outlook-hinges-on-scoot--tigerair-improvements-237749>. [Accessed on 4th
January 2016].
Singapore Airlines Sustainability report. 2013/14. [Pdf]. Available
through:<https://www.singaporeair.com/pdf/Investor-Relations/Annual-Report/
sustainabilityreport1314.pdf>. [Accessed on 4th January 2016].
Wensveen, J., 2010. [Pdf]. Available
through:<http://sydney.edu.au/business/__data/assets/pdf_file/0010/67789/johnw-
presentation.pdf>. [Accessed on 4th January 2016].
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APPENDIX
Appendix- 1
Horizontal analysis of Profit and loss account
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Profit and loss account
Increase or
decrease
2014-2015 2013-2014 Amount Percentage
Total revenue 15565.5 15243.9 321.6 2.1096963376
Total expenditure 15156.1 14984.6 171.5 1.1445083619
Operating profit 409.4 259.3 150.1 57.8866178172
Finance charges 49.6 37.3 12.3 32.9758713137
Interest income 74.9 62.7 12.2 19.4577352472
Surplus/ On disposal of aircraft,
spares and spare engines 51.9 51.2 0.7 1.3671875
Dividend from long term
investments 13.2 19.6 -6.4 -32.6530612245
Other non operating items 14.3 1.9 12.4 652.6315789474
Share of profits of joint venture 52 94 -42 -44.6808510638
Share of losses/profits of associated
companies -129.1 -45.2 -83.9 185.6194690265
Profit before exceptional items 408.4 406.2 2.2 0.5416051206
Exceptional items
Re measurement gain from
consolidation of Tiger Airways 119.8 119.8
Impairment of china cargo airlines 63.6 63.6
Gain on divestment of an associated
company 7.3 371.5 -364.2 -98.0349932705
Impairment of freighters 7 293.4 -286.4 -97.6141785958
Writeback of
impairment/(impairment) of
property, plant and equipment of
Singapore flying college 2.1 29.4 -27.3 -92.8571428571
Competition-related fines and
settlements 24.1 87 -62.9 -72.2988505747
Profit before taxation 442.9 367.9 75 20.3859744496
Profit attributable to owners of the
parent 367.9 359.5 8.4 2.3365785814
Profit and loss account
Increase or
decrease
2013-2014 2012-2013 Amount Percentage
Total revenue 15243.9 15098.2 145.7 0.9650156972

Total expenditure 14984.6 14869 115.6 0.777456453
Operating profit 259.3 229.2 30.1 13.1326352531
Finance charges 37.3 42.7 -5.4 -12.6463700234
Interest income 62.7 62.5 0.2 0.32
Surplus/ On disposal of aircraft, spares
and spare engines 51.2 56 -4.8 -8.5714285714
Dividend from long term investments 19.6 27.3 -7.7 -28.2051282051
Other non operating items 1.9 11.9 -10 -84.0336134454
Share of profits of joint venture 94 94.9 -0.9 -0.9483667018
Share of losses/profits of associated
companies -45.2 50.4 -95.6 -189.6825396825
Profit before exceptional items 406.2 489.5 -83.3 -17.0173646578
Exceptional items
Re measurement gain from
consolidation of Tiger Airways
Impairment of china cargo airlines
Gain on divestment of an associated
company 371.5 371.5
Impairment of freighters -293.4 -293.4
Writeback of impairment/(impairment)
of property, plant and equipment of
Singapore flying college -29.4 -29.4
Competition-related fines and
settlements -87 -19.9 -67.1 337.1859296482
Profit before taxation 367.9 469.6 -101.7 -21.6567291312
Profit attributable to owners of the
parent 359.5 378.9 -19.4 -5.120084455
Profit and loss account
Increase or
decrease
2012-2013 2011-2012 Amount Percentage
Total revenue 15098.2 14857.8 240.4 1.6180053575
Total expenditure 14869 14571.9 297.1 2.0388556057
Operating profit 229.2 285.9 -56.7 -19.8321091291
Finance charges 42.7 74.3 -31.6 -42.530282638
Interest income 62.5 50.5 12 23.7623762376
Surplus/ On disposal of aircraft,
spares and spare engines 56 -1.4 57.4 -4100
Dividend from long term investments 27.3 18 9.3 51.6666666667
Other non operating items 11.9 48.8 -36.9 -75.6147540984
Share of profits of joint venture 94.9 73.5 21.4 29.1156462585
Share of losses/profits of associated
companies 50.4 37.7 12.7 33.6870026525
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Profit before exceptional items 489.5 438.7 50.8 11.5796671985
Exceptional items
Re measurement gain from
consolidation of Tiger Airways
Impairment of china cargo airlines
Gain on divestment of an associated
company
Impairment of freighters
Writeback of
impairment/(impairment) of property,
plant and equipment of Singapore
flying college
Competition-related fines and
settlements 19.9 5.4 14.5 268.5185185185
Profit before taxation 469.6 433.3 36.3 8.3775675052
Profit attributable to owners of the
parent 378.9 335.9 43 12.8014289967
Profit and loss account
Increase or
decrease
2011-2012 2010-2011 Amount Percentage
Total revenue 14857.8 14524.8 333 2.2926305354
Total expenditure 14571.9 13253.5 1318.4 9.9475610216
Operating profit 285.9 1271.3 -985.4 -77.5112089987
Finance charges 74.3 70.1 4.2 5.9914407989
Interest income 50.5 37.3 13.2 35.3887399464
Surplus/ On disposal of aircraft,
spares and spare engines 1.4 103.3 -101.9 -98.6447241045
Dividend from long term investments 18 23.8 -5.8 -24.3697478992
Other non operating items 48.8 80.1 -31.3 -39.0761548065
Share of profits of joint venture 73.5 71.7 1.8 2.510460251
Share of losses/profits of associated
companies 37.7 87.9 -50.2 -57.1103526735
Profit before exceptional items 438.7 1605.3 -1166.6 -72.6717747462
Exceptional items
Re measurement gain from
consolidation of Tiger Airways
Impairment of china cargo airlines
Gain on divestment of an associated
company
Impairment of freighters
Writeback of
impairment/(impairment) of property,
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plant and equipment of Singapore
flying college
Competition-related fines and
settlements 5.4 201.8 -196.4 -97.3240832507
Profit before taxation 433.3 1403.5 -970.2 -69.1271820449
Profit attributable to owners of the
parent 335.9 1092 -756.1 -69.2399267399
Horizontal Analysis of Balance sheet
Items of balance sheet 2010/11 2011/12
Absolute
changes
Percentage
changes
Share capital 1832.4 1856.1 23.7 1.2933857236
Treasury shares 43 258.4 215.4 500.9302325581
Capital reserve 91.8 99.1 7.3 7.9520697168
Foreign currency translation
reserves 186.1 186.3 0.2 0.1074691026
Share based compensation reserve 172.6 165.9 -6.7 -3.8818076477
Fair value reserve 138 47.6 -90.4 -65.5072463768
General reserve 12747.7 11264.6 -1483.1 -11.6342555912
Equity attributable to owners of the
parent 14204.4 12893.4 -1311 -9.2295345104
Non controlling interest 298.4 294 -4.4 -1.4745308311
Total equity 14502.8 13187.4 -1315.4 -9.0699726949
Property, plant and equipment 13877.6 13381.4 -496.2 -3.575546204
Intangible assets 125.2 158.3 33.1 26.4376996805
Associated companies 504.8 543.2 38.4 7.6069730586
Joint venture companies 102.8 113.2 10.4 10.1167315175
Long term investment 35.3 373.7 338.4 958.6402266289
Other noncurrent assets 119.6 267.3 147.7 123.4949832776
Current assets 9779.2 7205.9 -2573.3 -26.3140134162
Total assets 24544.5 22043 -2501.5 -10.1916926399
Deferred account 347.1 224.4 -122.7 -35.3500432152
Deferred taxation 2181.1 2029.1 -152 -6.9689606162
Other noncurrent liabilities 1281.2 1337.1 55.9 4.3630970965
Current liabilities 6232.3 5265 -967.3 -15.5207547775
Total liabilities 10041.7 8855.6 -1186.1 -11.8117450233
Net assets 14502.8 13187.4 -1315.4 -9.0699726949
Items of balance sheet 2011/12 2012/13
Absolute
changes
Percentage
changes
Share capital 1856.1 1856.1 0 0
15

Treasury shares 258.4 269.8 11.4 4.4117647059
Capital reserve 99.1 110.3 11.2 11.301715439
Foreign currency translation
reserves 186.3 191.8 5.5 2.9522275899
Share based compensation reserve 165.9 151.7 -14.2 -8.5593731163
Fair value reserve 47.6 27.1 -20.5 -43.0672268908
General reserve 11264.6 11460.1 195.5 1.7355254514
Equity attributable to owners of the
parent 12893.4 13089.5 196.1 1.5209331906
Non controlling interest 294 312.6 18.6 6.3265306122
Total equity 13187.4 13402.1 214.7 1.6280692176
Property, plant and equipment 13381.4 13098 -283.4 -2.1178650963
Intangible assets 158.3 218.5 60.2 38.0290587492
Associated companies 543.2 554.5 11.3 2.0802650957
Joint venture companies 113.2 120.8 7.6 6.7137809187
Long term investment 373.7 706.9 333.2 89.1624297565
Other noncurrent assets 267.3 230 -37.3 -13.9543583988
Current assets 7205.9 7499.5 293.6 4.0744390014
Total assets 22043 22428.1 385.1 1.7470398766
Deferred account 224.4 146.7 -77.7 -34.6256684492
Deferred taxation 2029.1 1948.2 -80.9 -3.9869893056
Other noncurrent liabilities 1337.1 1529.5 192.4 14.389350086
Current liabilities 5265 5401.6 136.6 2.5944919278
Total liabilities 8855.6 9026 170.4 1.924206152
Net assets 13187.4 13402.1 214.7 1.6280692176
Items of balance sheet 2012/13 2013/14
Absolute
changes
Percentage
changes
Share capital 1856.1 1856.1 0 0
Treasury shares 269.8 262.2 -7.6 -2.8985507246
Capital reserve 110.3 123.7 13.4 10.8326596605
Foreign currency translation
reserves 191.8 101.5 -90.3 -88.9655172414
Share based compensation reserve 151.7 134.5 -17.2 -12.7881040892
Fair value reserve 27.1 40.4 13.3 32.9207920792
General reserve 11460.1 11527 66.9 0.5803765073
Equity attributable to owners of the
parent 13089.5 13237.2 147.7 1.1157948811
Non controlling interest 312.6 337.4 24.8 7.3503260225
Total equity 13402.1 13574.6 172.5 1.270755676
Property, plant and equipment 13098 13026.7 -71.3 -0.5473373917
16

Intangible assets 218.5 223.4 4.9 2.1933751119
Associated companies 554.5 729.4 174.9 23.9786125583
Joint venture companies 120.8 126.5 5.7 4.5059288538
Long term investment 706.9 1125.2 418.3 37.1756132243
Other noncurrent assets 230 100.6 -129.4 -128.6282306163
Current assets 7499.5 7310.7 -188.8 -2.5825160381
Total assets 22428.1 22642.5 214.4 0.9468919068
Deferred account 146.7 226.4 79.7 35.203180212
Deferred taxation 1948.2 1788.9 -159.3 -8.9049136341
Other noncurrent liabilities 1529.5 1661.2 131.7 7.9280038526
Current liabilities 5401.6 5391.4 -10.2 -0.1891901918
Total liabilities 9026 9067.9 41.9 0.4620694979
Net assets 13402.1 13574.6 172.5 1.270755676
Items of balance sheet 2013/14 2014/15
Absolute
changes
Percentage
changes
Share capital 1856.1 1856.1 0 0
Treasury shares 262.2 326.3 64.1 24.4469870328
Capital reserve 123.7 215.9 92.2 74.5351657235
Foreign currency translation
reserves 101.5 135.7 34.2 33.6945812808
Share based compensation reserve 134.5 113.2 -21.3 -15.8364312268
Fair value reserve 40.4 706.2 665.8
1648.019801980
2
General reserve 11527 11446.6 -80.4 -0.6974928429
Equity attributable to owners of the
parent 13237.2 12463.6 -773.6 -5.8441362222
Non controlling interest 337.4 466.5 129.1 38.2631890931
Total equity 13574.6 12930.1 -644.5 -4.7478378737
Property, plant and equipment 13026.7 13523.2 496.5 3.8114027344
Intangible assets 223.4 497.6 274.2 122.739480752
Associated companies 729.4 922.2 192.8 26.4326843981
Joint venture companies 126.5 167.9 41.4 32.7272727273
Long term investment 1125.2 1125 -0.2 -0.0177746178
Other noncurrent assets 100.6 220 119.4 118.6878727634
Current assets 7310.7 7465 154.3 2.1106050036
Total assets 22642.5 23921.2 1278.7 5.6473445953
Deferred account 226.4 141.7 -84.7 -37.4116607774
Deferred taxation 1788.9 1599.6 -189.3 -10.5819218514
Other noncurrent liabilities 1661.2 2467.3 806.1 48.5251625331
17

Current liabilities 5391.4 6782.5 1391.1 25.8022035093
Total liabilities 9067.9 10991.1 1923.2 21.2088796745
Net assets 13574.6 12930.1 -644.5 -4.7478378737
Vertical analysis of Profit and loss account
Profit and loss account
2014-2015 2013-2014
Amount Percent Amount Percent
Total revenue 15565.5 100.00% 15243.9 100.00%
Total expenditure 15156.1
97.369824290
9 14984.6
98.29899172
78
Operating profit 409.4 2.6301757091 259.3
1.701008272
2
Finance charges 49.6 0.3186534323 37.3
0.244688039
2
Interest income 74.9 0.4811923806 62.7
0.411312065
8
Surplus/ On disposal of aircraft,
spares and spare engines 51.9 0.3334297003 51.2
0.335872053
7
Dividend from long term
investments 13.2 0.0848029296 19.6
0.128576020
6
Other non operating items 14.3 0.0918698404 1.9 0.012464002
Share of profits of joint venture 52 0.3340721467 94
0.616640098
7
Share of losses/profits of associated
companies -129.1 -0.8293983489 -45.2
-
0.296512047
4
Profit before exceptional items 408.4 2.6237512447 406.2
2.664672426
3
Exceptional items
Re measurement gain from
consolidation of Tiger Airways 119.8 0.7696508304 0
Impairment of china cargo airlines 63.6 0.4085959333 0
Gain on divestment of an associated
company 7.3 0.0468985898 371.5
2.437040389
9
Impairment of freighters 7 0.0449712505 293.4 1.924704308
Writeback of
impairment/(impairment) of
property, plant and equipment of
Singapore flying college
2.1 0.0134913752 29.4 0.192864030
9
Competition-related fines and
settlements 24.1 0.1548295911 87
0.570720091
3
18

Profit before taxation 442.9 2.8453952652 367.9
2.413424386
1
Profit attributable to owners of the
parent 367.9 2.3635604381 359.5
2.358320377
3
2012-2013 2011-2012 2010-2011
Amount Percent Amount Percent Amount Percent
Total revenue 15098.2 100.00% 14857.8 100.00% 14524.8 100.00%
Total expenditure 14869
98.4819382
443 14571.9
98.075758
1876 13253.5
91.24738
3785
Operating profit 229.2
1.51806175
57 285.9
1.9242418
124 1271.3
8.752616
215
Finance charges 42.7 0.28281517 74.3
0.5000740
352 70.1
0.482622
8244
Interest income 62.5
0.41395663
06 50.5
0.3398888
126 37.3
0.256802
1591
Surplus/ On disposal of
aircraft, spares and spare
engines 56
0.37090514
1 1.4
0.0094226
602 103.3
0.711197
4003
Dividend from long term
investments 27.3
0.18081625
62 18
0.1211484
877 23.8
0.163857
6779
Other non operating items 11.9
0.07881734
25 48.8
0.3284470
11 80.1
0.551470
5882
Share of profits of joint
venture 94.9
0.62855174
79 73.5
0.4946896
58 71.7
0.493638
4666
Share of losses/profits of
associated companies 50.4
0.33381462
69 37.7
0.2537387
769 87.9
0.605171
844
Profit before exceptional
items 489.5
3.24210833
08 438.7
2.9526578
632 1605.3
11.05213
15268
Exceptional items
Re measurement gain
from consolidation of
Tiger Airways 0 0 0
Impairment of china
cargo airlines 0 0 0
Gain on divestment of an
associated company 0 0 0
Impairment of freighters 0 0 0
Writeback of
impairment/(impairment)
of property, plant and
equipment of Singapore
flying college 0 0 0
19

Competition-related fines
and settlements -19.9
-
0.13180379
12 5.4
0.0363445
463 201.8
1.389347
874
Profit before taxation 469.6
3.11030453
96 433.3
2.9163133
169 1403.5
9.662783
6528
Profit attributable to
owners of the parent 378.9
2.50957067
73 335.9
2.2607653
892 1092
7.518175
8096
Vertical analysis of Balance sheet
Items of balance sheet 2010/11
Percent
(%) 2011/12
Percent
(%) 2012/13 Percent (%)
Share capital 1832.4
12.6348
015556 1856.1
14.0747986
715 1856.1
13.84932212
12
Treasury shares 43
0.29649
447 258.4
1.95944613
8 269.8
2.013117347
3
Capital reserve 91.8
0.63298
12174 99.1
0.75147489
27 110.3
0.823005349
9
Foreign currency
translation reserves 186.1
1.28320
04854 186.3
1.41271213
43 191.8
1.431119003
7
Share based compensation
reserve 172.6
1.19011
50123 165.9
1.25801901
82 151.7 1.131912163
Fair value reserve 138
0.95154
03922 47.6
0.36095060
44 27.1
0.202207116
8
General reserve 12747.7
87.8981
989685 11264.6
85.4194155
027 11460.1
85.50973354
92
Total Equity attributable
to owners of the parent 14204.4
97.9424
662824 12893.4
97.7705992
083 13089.5
97.66752971
55
Non controlling interest 298.4
2.05753
37176 294
2.22940079
17 312.6
2.332470284
5
Total equity 14502.8 100 13187.4 100 13402.1 100
Property, plant and
equipment 13877.6
56.5405
691703 13381.4
60.7058930
273 13098
58.39995362
96
Intangible assets 125.2
0.51009
39111 158.3
0.71814181
37 218.5 0.974224299
Associated companies 504.8
2.05667
25743 543.2
2.46427437
28 554.5
2.472344960
1
Joint venture companies 102.8
0.41883
11027 113.2
0.51354171
39 120.8
0.538610047
2
Long term investment 35.3
0.14382
04078 373.7
1.69532277
82 706.9
3.151849688
6
Other noncurrent assets 119.6
0.48727
8209 267.3
1.21262985
98 230
1.025499262
1
20

Current assets 9779.2
39.8427
346249 7205.9
32.6901964
342 7499.5
33.43796398
27
Total assets 24544.5 100 22043 100 22428.1 100
Deferred account 347.1
3.45658
60362 224.4
2.53398979
18 146.7
1.625304675
4
Deferred taxation 2181.1
21.7204
258243 2029.1
22.9131848
774 1948.2
21.58431198
76
Other noncurrent liabilities 1281.2
12.7587
958214 1337.1
15.0989204
571 1529.5
16.94549080
43
Current liabilities 6232.3
62.0641
92318 5265
59.4539048
738 5401.6
59.84489253
27
Total liabilities 10041.7 100 8855.6 100 9026 100
Net assets 14502.8 13187.4 13402.1
Items of balance sheet 2013/14 Percent (%) 2014/15 Percent (%)
Share capital 1856.1 13.6733310742 1856.1 14.3548773791
Treasury shares 262.2 1.9315486276 326.3 2.5235690366
Capital reserve 123.7 0.911260737 215.9 1.6697473337
Foreign currency translation
reserves 101.5 0.7477200065 135.7 1.0494891764
Share based compensation reserve 134.5 0.9908210923 113.2 0.8754766011
Fair value reserve 40.4 0.2976146627 706.2 5.461674697
General reserve 11527 84.9159459579 11446.6 88.526770868
Total Equity attributable to
owners of the parent 13237.2 97.5144755647 12463.6 96.3921392719
Non controlling interest 337.4 2.4855244353 466.5 3.6078607281
Total equity 13574.6 100 12930.1 100
Property, plant and equipment 13026.7 57.5320746384 13523.2 56.5322809892
Intangible assets 223.4 0.9866401678 497.6 2.0801632025
Associated companies 729.4 3.2213757315 922.2 3.855157768
Joint venture companies 126.5 0.5586838909 167.9 0.7018878652
Long term investment 1125.2 4.9694159214 1125 4.702941324
Other noncurrent assets 100.6 0.4442972287 220 0.9196863034
Current assets 7310.7 32.2875124213 7465 31.20662843
Total assets 22642.5 100 23921.2 100
Deferred account 226.4 2.4967191963 141.7 1.2892249183
Deferred taxation 1788.9 19.7278311406 1599.6 14.5535933619
Other noncurrent liabilities 1661.2 18.3195668236 2467.3 22.4481626043
Current liabilities 5391.4 59.4558828395 6782.5 61.7090191155
Total liabilities 9067.9 100 10991.1 100
21

Net assets 13574.6 12930.1
Appendix- 2
Trend of sales for past five years
Trend of Profit for past five years
22
2014-2015 2013-2014 2012-2013 2011-2012 2010-2011
14000
14200
14400
14600
14800
15000
15200
15400
15600
15800

Trend of Assets for past five years
Trend of Liabilities for past five years
23
2014-2015 2013-2014 2012-2013 2011-2012 2010-2011
0
200
400
600
800
1000
1200
2010-2011 2011-2012 2012-2013 2013-2014 2014-2015
20500
21000
21500
22000
22500
23000
23500
24000
24500
25000

Appendix -3
Ratios Formula
2014-
2015
2013-
2014
2012-
2013
2011-
2012
2010-
2011
Profitability ratios
Operating profit 409.4 259.3 229.2 285.9 1271.3
Net profit 367.9 359.5 378.9 335.9 1092
Average total asset 23281.85 22535.3 22235.55
23293.7
5 23514.4
Net Sales 15565 15243.9 15098.2 14857.8 14524.8
Total expenditure 15156.1 14984.6 14869 14571.9 13253.5
Average
stockholders’ equity 13252.35 13488.35 13294.75 13845.1
14126.0
5
Operating Profit
Ratio
(Operating Profit/ Net
Sales) *100 2.63 1.70 1.52 1.92 8.75
Net Profit Ratio
(Net Profit/ Net Sales)
*100 2.36 2.36 2.51 2.26 7.52
Return on asset
(Net Sales/ Average total
asset) 0.66 0.68 0.68 0.64 0.62
24
2010-2011 2011-2012 2012-2013 2013-2014 2014-2015
0
2000
4000
6000
8000
10000
12000

Expense ratio
(Expenses/ Net Sales)
*100 97.37 98.30 98.48 98.08 91.25
Return on
shareholders’
investment
(Net income after interest
and tax/ Average
stockholders’ equity)
*100 2.78 2.67 2.85 2.43 7.73
Appendix -4
Ratios Formula
2014-
2015
2013-
2014
2012-
2013
2011-
2012
2010-
2011
Dividend Ratios
Price earnings Ratio -
Adjusted
Market Value per share/
EPS 38.06 34.22 33.76 38.06 14.97
Earnings per share
(Net income- Preferred
dividend)/ Weighted
average number of shares
outstanding 0.31 0.3 0.32 0.28 0.9
Dividend Yield
Dividend per share/
Market value per share 2.45 3.72 2.45 1.45 11.8
Dividend Payout
ratio
Dividend per share/
Earnings per share 52.9 79.7 110.2 22.1
Dividend cover ratio
(times) 1.4 0.7 1.4 1.4 0.7
Appendix -5
Ratios Formula
2014-
2015
2013-
2014
2012-
2013
2011-
2012
2010-
2011
Stability and
Liquidity ratios
Current Ratio
Current Assets / current
Liabilities 1.1 1.36 1.35 1.37 1.57
Quick Ratio
(Cu. Assets - Cl.
Stock)/Cu. Liabilities 1.04 1.29 1.27 1.28 1.48
Debt to Equity ratio 0.07 0.08 0.08
Efficiency ratios
Asset turnover
Net sales/ Average total
assets 0.67 0.68 0.68 0.64 0.62
25

Inventory turnover
Cost of goods sold/
Average inventory at cost 42.25 38 33.56 27.32 19.69
Appendix -6
Additional ratios
2014-
2015
2013-
2014
2012-
2013
2011-
2012
2010-
2011
Profitability ratios
Fixed asset 14241.1 13350.7 13546.5 13807 14122.4
Current Assets 7465 7310.7 7499.5 7205.9 9779.2
Current liabilities 6782.5 5391.4 5401.6 5265 6232.3
Capital employed 14923.6 15270 15644.4 15747.9 17669.3
Net income before
interest and tax 442.9 367.9 469.6 433.3 1403.5
Return on capital
employed
(Net income before interest
and tax/ Capital employed)
*100
2.96778
25726
2.40929
92796
3.00171
3073
2.75147
79748
7.94315
56428
Net income 367.9 359.5 378.9 335.9 1092
Total equity 12930.1 13574.6 13402.1 13187.4 14502.8
Return on common
stockholders ratio
((Net income – Preferred
dividend)/ Average
common stockholder's
equity) *100
2.84529
89536
2.64832
84959
2.82716
88765
2.54712
83195
7.52958
04948
Activity ratios
Accounts receivable
turnover ratio
Net credit sales/ Average
trade receivables 10.37 9.86 10.29 10.78 10.56
Average collection
period
Number of working days/
Debtors turnover ratio
35.1976
856316
37.0182
555781
35.4713
313897
33.8589
981447
34.5643
939394
Accounts payable 2906.5 2977.9 3055.7 2885.4 2498.7
Net credit purchases 15156.1 14984.6 14869 14571.9 13253.5
Accounts payable
turnover ratio
Net credit purchases/
Average accounts payable
5.21455
35868
5.03193
52564
4.86598
81533
5.05021
83406
5.30415
81622
Average accounts
payable
Accounts payable/
Average daily credit
purchase
69.9964
040881
72.5367
043498
75.0104
579999
72.2741
028967
68.8139
359414
Average daily
credit purchases
Credit purchases/ Number
of working days in a year
41.5235
616438
41.0536
986301
40.7369
863014
39.9230
136986
36.3109
589041
Average payment
period
((Accounts payable *
Number of working days)/
Net credit purchases
69.9964
040881
72.5367
043498
75.0104
579999
72.2741
028967
68.8139
359414
Cost of good sold 60.39 64.54 64.58 63.95 55.5
26

Net working capital 683 1919 1953 1941 3547
Working capital
turnover ratio
Cost of good sold /Net
working capital
0.08841
87408
0.03363
21001
0.03306
70763
0.03294
69346
0.01564
70257
Fixed assets turnover
ratio
Cost of sales /Net fixed
asset 1.17 1.17 1.14 1.09 1
Solvency ratios
Times interest
earned ratio
Income before interest and
tax/ Interest expense
10.6722
891566
10.1071
428571
13.7309
94152
4.98619
10242
20.2525
252525
Interest expense 41.5 36.4 34.2 86.9 69.3
Current Assets 7465 7310.7 7499.5 7205.9 9779.2
Total equity 12930.1 13574.6 13402.1 13187.4 14502.8
Total assets 23921.2 22642.5 22428.1 22043 24544.5
Fixed asset 14241.1 13350.7 13546.5 13807 14122.4
Fixed interest
bearing funds 2467.3 1661.2 1529.5 1337.1 1281.2
Proprietary ratio
(Stockholders equity/ Total
assets) *100
54.0528
903232
59.9518
604394
59.7558
420018
59.8257
95037
59.0877
793396
Fixed Assets to
Stockholder's
Equity Ratio
Fixed assets/ Stockholders
equity
1.10139
13272
0.98350
59597
1.01077
44309
1.04698
42425
0.97377
05822
Current Assets to
Equity Ratio
Current assets/
Stockholders equity
0.57733
50554
0.53855
73056
0.55957
64843
0.54642
31008
0.67429
73771
Capital Gearing
Ratio
Common stockholders
equity/ Fixed interest
bearing funds
5.24058
68763
8.17156
27257
8.76240
6015
9.86268
79067
11.3197
00281
27