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FINANCIAL RATIO ANALYSIS
BASIC ACCOUNTING ( FNBE 0145 )
ASSIGNMENT 1
TEE SIN YI (0315689)
LEONG CHEE MUN (0316256 )

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Report Content
Brief History of YTL 3-4
Profitability of YTL
(Year 2012-2013)
5-7
P/E Ratio 8
Investment Recommendation 9
Appendix 10-13
References 14

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Brief History of YTL
YTL Corporation Berhad is one of the largest companies listed on the Bursa Malaysia, and
together with its four listed entities has a combined Market Capitalisation of about RM 30.4
billion as at 30 April 2014, and has total assets of over RM53.6 billion. The company was
listed in 1985 and has also had a secondary listing on the Tokyo Stock Exchange since 1996.
YTL was the first Asian non-Japanese company to be listed on the Tokyo Stock Exchange.
The YTL Group's core businesses are ownership and management of regulated utilities and
other infrastructural assets, serving 12 million customers in three continents.
Year 1955
The YTL Corporation (YTL Corp) was founded by Tan Sri Dato' Seri Yeoh Tiong Lay aka Dr.
Yeoh Tiong Lay in 1955.
Year 1988
His oldest son, Tan Sri Dato' Seri Francis Yeoh Sock Ping aka Dr. Francis Yeoh Sock Ping,
became the Managing Director of YTL Corp in 1988. Under the stewardship of Dr. Francis,
the YTL Group grew from a single listed entity in 1985 to a group of five listed companies.
Until now…
YTL Corporation's strategy of providing "World Class Products and services at very
competitive prices" along with its history of Innovation, has led directly to it recording a
compounded annual growth rate in Pre-tax profits of 55% over the last 15 years, and an
enviable track record of creating shareholder value. It has been paying dividends every year
since it was listed on KLSE. YTL Corporation's strategy has also resulted in it and its
subsidiaries accumulating numerous International Awards in the process.

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YTL Corporation Bhd emerged in the coveted position of being the largest non-government
linked company in the 2010 MB100 survey of Malaysia's Largest Listed Companies. YTL Corp
moved up to number five from number 20 previously, and its subsidiary YTL Power
International Bhd secured the eighth spot.
YTL Logo

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Profitability of YTL
Financial Ratio
Profitability
Ratios
2012
RM’000
2013
RM’000
Interpretation
Return on
Equity (ROE)
1,835,920
13,458,095
× 100
= 13.64%
1,845,782
14,968,500
× 100
= 12.33%
During the 2012 to 2013
period, the ROE has
increased from 13.64% to
12.33%. This means the
owner is getting less return
from her/his investment.
Net Profit
Margin (NPM)
1,835,920
20,195,789
× 100
= 9.09%
1,845,782
19,972,948
× 100
= 9.24%
During the 2012 to 2013
period, the NPM has
increased from 9.09% to
9.24%. This means the
business is getting better at
controlling its overall
expenses.
Gross Profit
Margin (GPM)
4,230,374
20,195,789
× 100
= 20.95%
4,156,379
19,972,948
× 100
= 20.81%
During the 2012 to 2013
period, the GPM has
decreased from 20.95% to
20.81%. This means getting
work at controlling its
COGS.
Selling Exp.
Ratio (SER)
318,146
20,195,789
× 100
= 1.57%
318,667
19,972,948
× 100
= 1.6%
During the 2012 to 2013
period, the SER has
increased from 1.57% to
1.6%. This means the
business getting worse at
controlling its selling
expenses.
General Exp.
Ratio (GER)
1,052,069
20,195,789
× 100
= 5.2%
1,075,820
19,972,948
× 100
= 5.39%
During the 2012 to 2013
period, the GER has
increased from 5.2% to
5.39%. This means the
business getting worse at
controlling its general
expenses.
Financial Exp.
1,009,220
20,195,789
× 100
1,001,293
19,972,948
× 100 During the 2012 to 2013

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Ratio (FER) = 4.99% = 5.01% period, the FER has increase
from 4.99% to 5.01%. This
means the business getting
better at controlling financial
expenses.
Stability
Ratios
2012
RM’000
2013
RM’000
Interpretation
Working
Capital (WCR)
51,623,313
15,932,809
= 3.24:1
20,719,379
8,109,706
= 2.55:1
During the 2012 to 2013
period, the WCR decrease
from 3.24:1 to 2.55:1. This
means that the business
ability to pay current
liabilities with current asset
getting worst. In addition, the
business satisfy minimum
requirement of 2:1.
Total Debt
(DR)
37,244,057
51,623,313
× 100
= 72.15%
38,061,749
53,619,494
× 100
= 70.98%
During the 2012 to 2013
period, the DR decrease from
72.15% to 70.98%. This
means that the business total
debt has reduced. However,
it is still over the maximum
limit of 50%.
Stock Turnover
(STR)
365 ÷ [
15,965,415
882,228
]
= 20.17 days
365 ÷ [
15,816,569
910,611
]
= 21.01 days
During the 2012 to 2013
period, the STR has
increased from 20.17days to
21.01days. This means the
business is selling
inventories slower.
Debtor
Turnover
(DTR)
365 ÷ [
10,097,894
3,547,580
]
= 128 days
365 ÷ [
9,986,474
3,607,394
]
= 132 days
During the 2012 to 2013
period, the DTR has increase
from 128 days to 132 days.
This is means the business is
collecting debts slower.
Interest
Coverage
(ICR)
2,847,075
1,001,293
= 2.84 times
2,983,310
1,009,220
= 2.96 times
During 2012 to 2013 period,
the ICR has increase from
2.84 times to 2.96 times. This
means the business ability to
pay its interest is stronger. In

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addition, it does not satisfy
the minimum requirement of
5 times.

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P/E Ratio
P/E Ratio
=
𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑆ℎ𝑎𝑟𝑒 𝑃𝑟𝑖𝑐𝑒
𝐸𝑎𝑟𝑛𝑖𝑛𝑔 𝑆ℎ𝑎𝑟𝑒 𝑃𝑟𝑖𝑐𝑒
=
1.74
0.12
= 14.5
The P/E Ratio for YTL Corporation Berhad is 14.5. This is means investor need to
wait for 14.5 years to recoup this investment.

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Investment Recommendation
A) Profitability
During the 2012 to 2013 period, YTL Corporation Berhad had experienced a
bad profitability since Return on Equity was decreased from 13.64% to
12.33%. This means the owner was getting less from her/his investment.
Although YTL Corporation Berhad had experienced bad profitability during
the year, but Net Profit Margin was increased from 9.09% to 9.24% while
Gross Profit Margin was decreased 0.14% which means they were getting
work at controlling overall expenses and Cost of Goods Sold. Conversely,
Selling Expenses, General Expenses and Financial Expenses Ratio increased
0.03%, 0.19% and 0.02% in the year. This means the business is getting better
at controlling Financial Expenses.
B) Stability
YTL Corporation Berhad has strong Financial Stability. This is because they
satisfied the minimum requirement of 2:1 for Working Capital. Besides, for
Interest Coverage they increased 0.12 times this year which means it satisfied
the minimum requirement. However, they were actually in an unsafe level for
Total Debt since they were increased by 1.17% and above 50%. In addition,
they sold its inventory and collecting debts are slower and inefficient.
C) Price
The price of YTL Corporation Berhad’s share is still considered cheap as it
P/E Ratio does not over 15, which is 14.5.
In conclusion, we do not recommend investor invest this corporation due to
the reason that it does not have good profitability, even though has strong
financial stability and cheap share price right now.

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Appendix

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References
http://www.facebook.com/l.php?u=http%3A%2F%2Fwww.ytlcommunity.com%2Fannualrep
ort%2Fpdf%2FYTL%2520Corporation%2520Berhad_Annual%2520Report%25202013.pdf&h=
jAQFRf0QR
http://www.facebook.com/l.php?u=http%3A%2F%2Fwww.ytlcommunity.com%2Fannualrep
ort%2Fpdf%2FYTL%2520Corporation%2520Berhad_Annual%2520Report%25202012.pdf&h=
jAQFRf0QR
http://www.facebook.com/l.php?u=http%3A%2F%2Fwww.thestar.com.my%2FBusiness%2F
Marketwatch%2F%3Fquote%3DYTL&h=jAQFRf0QR