Ratios analysis

Construction sector

Liquidity ratio:
Liquidity ratio expresses a company's ability to repay short-term creditors out of its total cash. It
is the result of dividing the total cash by short-term borrowings. It shows the number of times
short-term liabilities are covered by cash.

Current ratio: current assets/current liabilities 2012 2013 2014

3.17

3.04

2.56

Analysis:
This ratio tells us about that how many of our assets convert in to cash soon. In 2012 its ratio was
3.17% and in 2013 its ratio was 3.04% and in 2014 its ratio was 2.56%. it means that our
company has more assets in 2012 than 2013, 204.

Quick ratio: current assets-inventory/ current liabilities

2012

2013 2014

2.97 2.85

2.39

Analysis:
In this ratio we subtract inventory from current assets and heck that our assets in 2012 was
2.97% and in 2013 was 2.85% and in 2014 was 2.39% it shows that we have more assets in
2012 than in 2013 and 2014.

Activity ratios
Activity ratios are financial analysis tools used to measure a business' ability to convert its assets
into cash.

Ratios
Inventory turnover: CGS/inventory

2012

2013

2014

7.464

8.564

7.986

Analysis:
In this ratio we convert our assets in to cash as shown that in 2012 we have 7.464% in 2013 we
have 8.564% and in 2014 we have 7.986% assets. So we have more assets in 2013 than in 2012
and 2014.

Average collection period: account receivable/annual sales/365

2012

2013

4.25

2014

3.86

4.46

Analysis:
This ratio tells that how much account receivable are collect in one day. In 2012 it was 4.25%
and in 2013 it was 3.86% in 2014 it was 4.46%. These ratios shows that we have more collection
in 2014 than 2012 and 2013.

Average payment period: account payable/ annual purchase/ 365

2012

2013 2014

3.22

3.24

3.56

Analysis:
This ratio tells that how much account payable was pay in one day. In 2012 it was 3.22% and in
2013 it was 3.24% in 2014 it was 3.56%. These ratios shows that we have more payment in 2014
than 2012 and 2013.

Asset turnover: sales/total asset

2012

2013

2014

.3987

.4896

.3995

Analysis:
In this ratio we divide sales over total asset to get asset turn over. In 2012 it was .3987% and in
2013 it was .4896% and in 2014 it was 3.995%. In these ratios we can say that we have more
assets in 2013.

Debt ratios
Debt ratio is a solvency ratio that measures a firm's total liabilities as a percentage of its total
assets. In a sense, the debt ratio shows a company's ability to pay off its liabilities with its assets.
In other words, this shows how many assets the company must sell in order to pay off all of its
liabilities.

Ratios
Debt ratios: total liabilities/total assets 2012
31.86

2013

2014

36.00

39.87

Analysis:
In this we check the debt ratio. In 2012 it was 31..86 in 2013 it was 36.00 and in 2014 it was
39.87%. it means that we have more debt ratio in 2014.

Time interest earn ratio: earning before interest and taxes/interest 2012

2013

2014

32.45

33.56

31.44

Analysis:
This ratio shows that we have 32.45% inn 2012 33.56% in 2013 and 31.44% in 2014. We have
more interest ratio in 2013.
3

Profitability of ratios
A profitability ratio is a measure of profitability, which is a way to measure a company's
performance. Profitability is simply the capacity to make a profit, and a profit is what is left over
from income earned after you have deducted all costs and expenses related to earning the
income.

Ratios
Gross profit margin: gross profit/sales

2012

2013

2014

13.266

14.93

47.79

Analysis:
This tells us about gross profit. We have 13.266% in 2013, 14.93% in 2013 and 47.79% 2014. It
shows that we have more GP margin in 2014.

Operating profit margin: operating profit/ sales

2012

2013

2014

35.69

37.74

32.03

Analysis:
In this we check OPM . in 2012 it was 35.69% in 2013 it was 37.74% and in 2014 it was
32.03%. so we have more in 2013.

Earnings per share: earnings available for common stockholders/ number of shares
2012

2013

2014

8.41

7.74

7.44

Analysis:
In Eps we check profit of one share. In 2012 it was 8.41, in 2013 it was 7.74% and in 2014 it was
7.44%. so we have more in 2012.

Return on total asset: earning available for cs/total asset

2012

2013

2014

10.32

1 1.17

11.17

Analysis:
In this we check that how much earning available for common sock. In 2012 it was 10.32 in
2013 it was 11.17 in 2014 it was 11.17. so we have same in 2013 and 2014 but more than 2012..

Return on common equity: earning/ stockholder equity

2012
11.77

2013

2014

11.67

12.20

Analysis:
In this we check that how much we are returning to common stock. In 2012 it was 11.77 and in
2013 it was 11.67, and in 2.14 it was 12.20. so we pay more in 2012.