University Business Analysis Report: SAHAM Ltd Financial Performance

This report presents a comprehensive business analysis of SAHAM Ltd, a prominent company operating in Africa across sectors like real estate, healthcare, education, and outsourcing. The analysis evaluates the company's financial performance through key ratios such as profitability, liquidity, and investment ratios, providing insights into its financial strength and weaknesses. The report explores the company's financial actions and policies, including acquisitions and strategic decisions made between 2015 and 2017, and assesses their impact on shareholder wealth. Furthermore, it critically examines the qualitative factors of the financial statements, adhering to fundamental and enhancing qualitative characteristics, and discusses the company's corporate governance and its relationship to shareholder wealth. The report also assesses the company's competitive landscape and revenue diversification across its various business segments, emphasizing its strategic positioning and operational efficiency.

Running head: BUSINESS ANALYSIS OF SAHAM LTD
Business Analysis of SAHAM Ltd
Name of Student
Name of the University
Author Note

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Business Analysis of SAHAM Ltd
Executive Summary
The aim of this report is understand the business analysis of SAHAM Ltd which is a major
key player in the African countries in the business of Real estate, health care, Education. In
this report certain financial ratio like profitability ratio, investment ration, and liquidity ratio
has been calculated to understand the entity financial position. Further the report also put a
light on the corporate policy of the company and points out the major strategic decision of the
corporation.

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Business Analysis of SAHAM Ltd
Table of Contents
Introduction................................................................................................................................3
Evaluation of the financial performance of the SAHAM Ltd................................................3
Certain key financial ratio has been calculated to determine the financial performance of
the company...........................................................................................................................3
Financial action taken and policy adopted by the company during the relevant financial
year.........................................................................................................................................6
Increase in the shareholder wealth through the financial action taken by the company........6
Critical evaluation of the important qualitative factors of the financial statement of the
Company....................................................................................................................................6
Fundamental qualitative characteristic include the following...............................................7
Enhancing qualitative characteristic include the following...................................................7
Examination of the Company Corporate governance and the shareholder wealth..................10
Conclusion................................................................................................................................13
References................................................................................................................................15

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Business Analysis of SAHAM Ltd
Introduction
The report has been prepared to showcase the business analysis SAHAM Ltd. The
company was founded in 1995. The company is a key major player in the supply of the
essential goods to the people in the North Africa. The company core business involve health
care, education, real estate and the outsourcing. The company has expanded its operation in
the 27 African countries (Enqvist, Graham, and Nikkinen, 2014).
Evaluation of the financial performance of the SAHAM Ltd.
Financial statement refers to the degree to which financial objective has been
achieved. The purpose of the analysis of the financial statement is to determine the financial
strength and weakness of the organization by evaluating the balance sheet and the profit&
loss account, cash flow statement (Ehiedu,2014.).
Certain key financial ratio has been calculated to determine the financial
performance of the company.
Profitability ratio
Profitability ratio are the financial parameter which represent the company ability to
generate income relative to its sales, operating cost and the shareholder funds. This ratio
represents how well the company is utilizing its assets and increasing their profit share and
shareholder profit (Buzzell, Gale, and Sultan 1975).
Some of the most common profitability ratio which have been calculated here are
following gross profitability ratio, net profit margin, Return on Equity.

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Business Analysis of SAHAM Ltd
Calculation of the Return Equity
Liquidity ratio
This is an important financial parameter which shows the firm ability to pay-off its
debt or loan obligation without utilizing any external financial assistance. Some of the
liquidity ratio of the firm include current ratio, quick ratio and the operating cash flow
methods (Sperry D.J., 2013)
Financial gearing ratio
This ratio represents the company proportion of the company borrowing with respect
to its Equity. High financial gearing ratio represent the high debt in the company capital
structure with respect to its equity. Some of the example of the financial ratio are the Debt to
equity ratio, interest earned ratio.

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Business Analysis of SAHAM Ltd
Debt to Equity ratio = Total liability / shareholder equity.
Efficiency ratio
Efficiency ratio measure the capability of a company to utilize their assets and
liability to generate revenue for the business of the organization. Some of the common
efficiency ratio used in the evaluation of the business are account receivable turnover,
inventory turnover, fixed assets turnover and the account payable turnover ratio. A high
efficiency ratio of the firm represent that the firm is effectively utilizing its assets to generate
the income for the business.
Investment Ratio
Investment ratio is defined as the ratio which helps in evaluating the performance of
the company in the on the basis of the performance of the share. Some of the most common
investment ratio to assess the performance of the investment of the company are Dividend
yield ratio, Dividend cover, earning per share, price Earnings ratio.
Earnings per share

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Business Analysis of SAHAM Ltd
Financial action taken and policy adopted by the company during the relevant
financial year.
The company has adopted various business policy and action for the diversification of
their business. In the year 2015 the company has made two major business acquisition
naming ECCO outsourcing of the Egypt and the continental re-insurance PLC of the Nigeria
(Williams and Dobelman, 2017). In the year 2016 the company has made successful business
decision about the purchasing of the stake in the Saham finances capital, the company has
also made an acquisition sun insurance which is a Mauritius based company (Bagley 2015).
In the morocco the company has made opening of the hospital named HPM clinic and
started the EIC and EIR School. In the year 2017 the company has increase the investment of
the Sanlam’s shares in the Saham finance capital to 46.6%.
Increase in the shareholder wealth through the financial action taken by the
company.
From the analysis of the business information identified above it can be seen that the
company has made a tremendous growth in the shareholder value by taking the above
business decision.

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Business Analysis of SAHAM Ltd
Such growth in the company can be seen through improvement in the financial
performance of the enterprise, such improvement can be measured through the increase in the
profitability ratios, liquidity ratio, capital gearing ratio of the company.
Critical evaluation of the important qualitative factors of the financial
statement of the Company.
Financial Statement of the enterprise must possess certain qualitative characteristic
which are necessary for representing the true financial position of the enterprise, there are
two approach of the qualitative characteristic of the enterprise which include the following.
Fundamental qualitative characteristic and the enhancing qualitative characteristic (Kramer,
Kinn, and Mishkind 2015).
Fundamental qualitative characteristic include the following
a) Relevance:
It means how helpful is the information presented in the financial statement of the
enterprise for the economic decision making of the users of the company. This means
the information presented in the financial in the financial statement should be fair and
prepared as per the relevant rules and regulation as the standard of auditing and
accounting standard. For accounting information to be relevant it must have
confirmatory and predictive value. Confirmatory value provides the information about
the past events on the other hand predictive value provide predictive opinion
regarding the future events of the company.
b) Representational faithfulness. Financial statement of the enterprise is required to
show true and fair view of the performance, financial position.

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Business Analysis of SAHAM Ltd
Enhancing qualitative characteristic include the following
a) Verifiability
A corporation's accounting outcomes are verifiable when they're reproducible, so that,
specified similar data and expectations, a self-governing auditor can produce the identical
outcome the corporation fixed. Verifiability isn't around defining whether the assumptions a
business creates are accurate. Rather, it's around evaluating whether the accounting outcome
the company finalized is suitable for the facts and figures, given the assumptions that have
been made (Penman and Penman, 2007).
b) Timeliness
Timeliness refers to how fast information is made accessible to users of the financial
statement Timeliness is significant to safeguard the interest of the stakeholder of the company
from establishing their decisions on obsolete information. Timeliness rule in accounting
discusses the requirement for accounting information to be accessible to the users in specified
time frame to achieve their decision based needs.
c) Understandably
Understandability is the conception that accounting information should be presented to
the users of the financial statement such that it should be easily comprehensible and easily
comprehensible. Based on their understand-ability users and other stakeholder makes their
economic decision about the investing their money in the company.
d) Comparability
Comparability is the degree to which standard of accounting and the rules and regulation
are constantly used from one period to another. Financial statements that can be compared,

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Business Analysis of SAHAM Ltd
with regular accounting standards and guidelines useful in every accounting period, empower
users to draw conclusions about the movements and enactment of the company.
Comparability also refers to the capability to effortlessly compare a corporation’s financial
information with those of other corporations.
The qualitative characteristics of financial statement are significant because it help the
company management and the shareholder to make an informed business decision.
From the analysis of the broad characteristic mentioned above certain Qualitative factors
have been identified in the SAHAM Ltd which have been discussed below.
Whether the company is generating its major revenue from the single major customer.
From the critical analysis of the business of SAHAM Ltd, it has been identified that
the company has diversified its business in different sector like health care, real estate,
outsourcing and supply of human resources. This means the company is not dependent on a
single customer for the generation of their revenue. As a result the company has diverse
option to produce their revenue, as a result, when certain sector of the market is not
performing well, the company can earn their revenue from the other sectors of the market. On
the other hand, the company has invested in certain business which perform at par despite of
the many ups and down in the economy like health care and pharmaceutical industry.
How much business the company is able to successfully able to generate from the
overseas.
The company SAHAM Ltd has been successfully able to grow its business presence
in more than 27 countries in the world. Being a pan African key-player, the company has
made certain strategic business decision, which help the corporation to identify the potential
market in the world to expand their business operation. Some of the major key decision taken

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Business Analysis of SAHAM Ltd
by the firm during the different financial year has been discussed below. The company was
founded in 1995 and in the same year the company has made an acquisition of a brokerage
firm named Amga. In the year 1997 the company has made an acquisition of minority stake
in the ISAAF assistance and the acquisition of the brokerage firm naming Lahlou-Tazi. On
the other hand with the recent Business development of the company in the concerned year, it
can be seen that the company has made quite development in its business in the year 2015,
2016 and 2017.
In the year 2015, the company has made an Acquisition of the Egyptian and Nigerian
company named Ecco outsourcing and continental re-insurance respectively. The company
in the year 2017 has increase in their shareholding in the company Saham finances capital to
46.6%.
From the data disclosed above, it can be conclude that the company is making huge profit
from its foreign business operation from the business.
Analysis of the extent to which the company revenue has been tied to one key product.
Since the company is operating its business operation from the different business like
Real estate, Health care, education, and the outsourcing services. This imply that the
company is not dependent on a single product or services for the generation of their revenue.
Critical examination of the Competition scenario of the company business.
The company is major player in its different sectors of the business like in the health
sector industry the company has done tremendous improvement in the business like the
company has made an innovative networks of clinics called Evya, which aimed to provide
their patient the top level quality of the service in the health care segment. The clinic has been
supported by the innovative cutting age technology. This network of clinic known for their

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Business Analysis of SAHAM Ltd
specific specialties, multidisciplinary surgery (Rey-Moreno, et al. 2015). The Evya network
of the clinic has been designed in accordance with international standard of hygiene and
safety. The operating room of the hospital has been designed in accordance with the global
standard, new sterilization units have been deployed in all units of the operation theater.
Optimal air handing and sanitation process has been given extra care in the building the
hospital and clinic. The company has provide 25270 free consultation service, the company
has made a record of sensitization of 8180 children on the oral hygiene, the company
recruited 130 multidisciplinary volunteer doctors. The company is the major player in the
health care industry in the morocco and a dominant player in the market among its
competitor.
Examination of the Company Corporate governance and the shareholder
wealth.
Corporate governance refers to the way the corporation is governed, it is the rules
under which the corporation is directed and managed (Weston et al. 2004). It means carrying
on the corporation business as per the stake holder wish. Corporate governance refers to take
effective business decision and ensures corporate success and economic growth, Goods
corporate governance practice increases the investor confidence in the business of the
organization, which means the investor provide the business of the corporation to do their
business project. Good corporate governance minimizes the wastages of the resources and the
corruption, risk and mismanagement. It also helps the company in the formation of the brand
and the development and result in the positive effects of the company on the share price.
In the year 2015, the company has outlined its all major business on the basis of the three
major phases.
 Setting of the company CSR policy standard.