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GROUP ASSIGNMENT COVER SHEET
STUDENT DETAILS Student name: Nguyễn Kim Tuyến Student ID number: B Student name: Trịnh Anh Nhã Trúc^ Student ID number: B Student name: Lê Trần Thu Uyên^ Student ID number: B Student name: Nguyễn Thanh Thiên Uyên^ Student ID number: B Student name: Trịnh Minh Tú^ Student ID number: B Student name: Nguyễn Văn Viên^ Student ID number: B UNIT AND TUTORIAL DETAILS Unit name: Corporate Finance Unit number: CF-S320WSB- Lecturer or Tutor name: Từ Thị Kim Thoa Class day and time: Thursday 8 a.m ASSIGNMENT DETAILS Title: Group Assignment: Financial Analysis Length: 19 pages Due date: December 10th Date submitted: December 10th Link to video:^ https://www.youtube.com/watch?v=i1Hl7mKN2Yo&feature=youtu.be&ab_channel=kimtuy%E1%BA%BFn DECLARATION I hold a copy of this assignment if the original is lost or damaged. I hereby certify that no part of this assignment or product has been copied from any other student’s work or from any other source except where due acknowledgement is made in the assignment. I hereby certify that no part of this assignment or product has been submitted by me in another (previous or current) assessment, except where appropriately referenced, and with prior permission from the Lecturer / Tutor / Unit Coordinator for this unit. No part of the assignment/product has been written/produced for me by any other person except where collaboration has been authorised by the Lecturer / Tutor /Unit Coordinator concerned. I am aware that this work will be reproduced and submitted to plagiarism detection softwareprograms for the purpose of detecting possible plagiarism (which may retain a copy on its database for future plagiarism checking). Student’s signature: Student’s signature: Student’s signature: Student’s signature: Student’s signature: Note: been signed. An examiner or lecturer / tutor has the right to not mark this assignment if the above declaration has not
CONTENT
Title Page
I. INTRODUCTION 3
II. REVIEW OF THE BALANCE SHEET OF BÚT SƠN IN THREE LATEST
YEAR^4
III. REVIEW AND COMPARISON BETWEEN BÚT SƠN AND THE INDUSTRY 5
IV. REVIEW AND COMPARISON BETWEEN BÚT SƠN AND BỈM SƠN 6
V. REVIEW OF THE MOST RECENT YEAR-END INCOME STATEMENT OF
BÚT SƠN
VI. RATIO ANALYSIS 8
VII.THE COMPARISON BETWEEN BÚT SƠN AND BỈM SƠN IN RATIO
ANALYSIS
VIII. CONCLUSION 12
IX. REFERENCES 13
X. APPENDIX 14
revenues for the last three years. The rest is about the contrast between But Son and its rivals in terms of sales and ratio research. II. Review of the three-lastest-year balance sheet of Bút Sơn
The balance sheet (Appendix 2) showed us what did But Son have in current assets and non-current assets; how much the firm owes in current liabilities, non-current-liabilities and represents the stockholders’ equity in consecutive years of 2017, 2018, and 2019.
As we can see from the table (Appendix 2), the year 2017 was reported to be the most remarkable year of Bút Sơn, when the current assets and non-current were recorded in the highest numbers, compared to the years 2018 and 2019. The current assets in 2017 were more than 740 billion VND, higher than in 2018 when the current assets decreased to only more than 666 billion VND. However, the current assets increased again to more than 709 billion VND in 2019. Nonetheless, the non-current assets in these periods decreased year by year. While in 2017, But Son reported having more than 3, billion VND, in 2018 it was 2,864 billion VND - lower 1.08 percent compared to 2017, and in 2019 it was recorded as 2,798 billion in non-current assets - lower than the year 2018 for about 1.02 percent.
The firm’s current liabilities in 2017 also was recorded in the lowest number while there was only more than 1,746 billion VND, while in 2018 there was 1,953 billion VND - up nearly 1.12 percent, also in 2019, the current liabilities are 2,063 billion VND, up 1.19 percent compared to 2017 and 1. percent compared to 2018. Notwithstanding, the firm’s non-current liabilities decreased surprisingly, from 740 billion VND in 2017 to 225 billion VND in 2018 (lower nearly 3.29 percent), and the firm was noted with only 35 billion VND in non-current liabilities at the end of 2019 (lower 6.41 percent compared to 2018).
The stockholder’s equity represents the amount of money that had been invested in the firm and supposed to be a source of funding for the business. According to the balance sheet, the stockholders’ equity had increased from 2017 to 2019 positively. In 2017, the amount of equity was 1,332 billion VND, which increased 1.02 percent to nearly 1,352 billion VND in 2018. Likewise, in 2019, the stockholder’s equity was 1,410 billion VND, up 1.04 percent compared to 2018.
III. Review and comparison between Bút Sơn and the industry
Among the plastic industry, packaging accounted for 35 percent, worth 5.2 billion USD. Preliminary statistics show that food packaging accounts for 30% - 50%, electronics packaging accounts for 5-10%, and pharmaceutical chemistry packaging accounts for 5-10%. Plastic packaging has achieved a growth rate of 25% in a year and accounted for the highest proportion of revenue in the structure of the plastic industry (38-39%). Simultaneously, plastic packaging products are also the most exported plastic products. (Thăng Long Packaging, 2020)
Compared to the industry, VICEM But Son has 3 cement packaging factories equipped with 2 synchronous production lines, designed with a capacity of 50 million bags/year. This is a complete technology consisting of 5 closed stages with 3 main types of products: KPK, PK, PP, and woven curtains from PP material (to make the inner lining of cement bags). To improve the quality of products, the company had invested billions of VND to install a production line of bottom-glued cement bags. (Tân Phú Hưng Company, n.d.). Meanwhile, following the development of the packaging industry, in 2017, But Son aimed to produce 80 million bags; 1,500 tons of PP woven curtains, total revenue from sales and service provision reached over 355,095 million VND (Appendix 3a). Likewise, in 2018, But Son reported the total production as the numbers of 86.57 million bags with a total sales and services revenue of more than 483 billion VND, exceeds the plan in 2018 (Appendix 3b). Similarly, the total sales and services revenue in 2019 reached nearly 454 billion VND with the production of 76.
V. Review of the most recent year-end income statement of Bút Sơn
As for Appendix 5, after reviewing the Income Statement of Vicem But son Cement Joint Stock Company (But Son) over the past 3 years, But Son’s total revenues fluctuated significantly in the period 2017- 2019. This means But Son's total revenues in 2018 increased by 36,3% in comparison with 2017, while decreased by 6,13% compared to 2019. Additionally, the cost of goods sold of But Son continuously grew by 26% when compared with 2017. However, as total revenues above, this still has a fluctuation from 2017 to 2019, by seeing a decrease in the cost of goods sold in 2019, fall by 7,2% compared to 2018. Besides, there was a gradual increase in total expense, in specific, the growth rate of total expense in 2019 rose by 16,6% compared to 2017. Furthermore, in terms of other profits, But Son’s losses in 2019 were 110 times in comparison with 2018. Moreover, the earnings per share of But Son shows that the percentage of its increased gradually from 2017 to 2019, by 41,9%. Especially, in the period 2018-2019, earnings per share of But Son has risen remarkably by 28,2%.
VI. Ratio analysis
Liquidity ratios (Appendix 6a) Liquidity ratios calculate businesses' ability to satisfy their short-term commitments. Liquidity ratios must be determined to determine the willingness of the company to cover short-term bills to measure But Son's short-term solvency. In 2017, But Son's current ratio is 0.8 and steadily increases until 2019 with 0.9. The growth shows a decrease in the company's short-term obligations. If growth continues, the company's finances don't stop growing in the short term. At the same time, the quick ratio of the company shows a continuously increasing trend. From 2017 to 2019, the quick ratio changes from 0.6 to 0.7 indicating an increase of 0.1. The fast ratio has grown continuously, showing that the company's inventories are on the rise. The ratio of cash in 2017 and 2018 can be considered stable, the two parameters do not differ much between 0.0191 and 0.0186. Then, in 2019, the cash ratio increases to 0.0229. Finally, the company is growing evenly in all the components of its solvency coefficients.
Efficiency ratios (Appendix 6b) Efficiency ratios decide how efficiently the business handles its revenue assets. The inventory turnover ratio shows how much a stock is used or sold twice in a period of time. In 2017, the inventory turnover ratio of But Son was 8.98, then in 2018 increased to 1.0, equivalent to 9.32. However, in the following year, the But Son dropped, even lower than the first year, with an index of 8.05. According to the above data, it is estimated that in 2017, But Son takes 40.6 days to turn inventory. In 2018, it only took 39.1 days to increase inventory turnover to 9.32, but in 2019 it will increase to 45.2 days. However, the period is longer than the previous two years but the inventory turnover ratio decreased. Following that, revenue turnover decreased continuously from 2017 to 2018. Specifically, the receivable turnover is 2.85 respectively; 2.44; 2.21. The above figure can be understood that in 2017,
Profitability Ratio (Appendix 6d)
The profitability ratio tests how well the company handles its revenue expenses. The profit margins that But Son achieved increased over 3 years, with indexes respectively 0.46, 0.69, and 0.83. Return on assets demonstrates how profitable an organization is in relation to all of its assets. For returns over 5% on assets, it is considered good. From 2017 to 2019, this rate steadily increased from 1.08 to 1.31. Return on equity calculation measured by the division of net profits by the equity of shareholders. In addition, the optimal return on equity is between 15% and 20%. This rate of return continued to increase over 3 periods. In general, the profitability situation is quite stable and on the way to developing.
Market Value Measures (Appendix 6e)
Taking from the table above, market value ratios are used to evaluate the current share price of a publicly-held company's stock. These ratios give equity analysts a basic framework of a company and can possibly help to identify undervalued or overvalued stocks. Book value per share (BVPS) is used as a benchmark to see if the market value per share is higher or lower, which can be used as a basis for stock buying or selling decisions. It grew up slightly over 3 periods. The P/E ratio also known as the price/earnings multiple is one of the most popular ratios used by investors to determine the value of a share. There was a downward trend in PE ratios during the year 2017 to 2019. While PE ratios in 2017 showed an upward trend, it suddenly dropped continually in 2018 and 2019. It can be seen that with high PE ratios, the stock is more richly valued in 2017 because investors are paying a higher price for each dollar of the company’s earnings.
VII. The comparison between Bút Sơn and Bỉm Sơn in ratio analysis
According to the statistics of Cafef Vietnam (2019), the total revenue and COGS of But Son increased significantly from 2017 to 2018 but there is a slight drop in 2019. Meanwhile, Bim Son's total revenue and COGS are decreasing steadily during this period. This reveals the business strategies of But Son is more efficient than Bim Son.
In 2019, based on the statistics of Cafef.vn (Appendix 6 ad 7), efficiency ratios are 1.06%, 8.06% and 2.22% prefer asset turnover, inventory turnover, and receivables turnover of But Son, alternatively. When Bim Son is a competitor with But Son, these ratios are 1.26%, 10.24%, and 1.61% As a result of this, Bim Son is better than But Son because Bim Son takes less time to get inventory, assets and get a cycle. Therefore, Bim Son uses and manages effectively in their assets and liability.
There is no doubt that the But Son's sales are much higher than the Bim Son in this 3-year period. But Son has been constantly improving in terms of technique and machinery, meanwhile, Bim Son, one of the development firms in the cement industry, has stalled because of projects on factory restructuring. But Son is expected to grow higher in the future.
IX. Reference
Thăng Long Packaging (October, 2020), Overview of the Packaging Industry in Vietnam. Retrieved from
Tân Phú Hưng Packaging Joint Stock Company (n.d.), Focus on the development of the packaging industry. Retrieved from
CafeF. (2017). Financial Statement Analysis(But Son). Retrieved from
CafeF. (2019). Financial Statement Analysis(But Son). Retrieved from
CafeF. (2017). Financial Statement Analysis(Bim Son). Retrieved from
CafeF. (2018). Financial Statement Analysis(Bim Son). Retrieved from
CafeF. (2019). Financial Statement Analysis(Bim Son). Retrieved from
X. Appendix
Balance Sheet (In VND) Bút Sơn 2017 2018 2019 Current assets 740,095,496,869 666,894,466,787 709,803,550, Non-current assets 3,079,469,186,048 2,864,629,852,495 2,798,707,725, Current liabilities 1,746,874,001,691 1,953,438,034,214 2,063,073,046, Non-current liabilities 740,481,076,750 225,383,030,103 35,158,031, Stockholder’ s equity 1,332,209,604,476 1,352,703,254,965 1,410,280,197,
Comparison between Bút Sơn and the industry a) Total output of Bút Sơn in 2017 (Annual report in 2017)
Output Unit 2017 (expect) 2017 (result) Cement bags Million bags Jumbo bags Million bags 80.00 58. PP woven curtains Million tons 1500.00 1405. Sales and Services Revenues Million VND 445,374 355,
b) Total output of Bút Sơn in 2018 (Annual report in 2018)
Output Unit 2018 (expect) 2018 (result) Cement bags Million bags 68 85. Jumbo bags Million bags 0.5 0. PP woven curtains Million tons 1,500 725. Sales and Services Revenues Million VND 444,170 483,
5) Income Statement
- Bút Sơn
- Total revenues 354.619.616.748 483.241.966.905 453.576.633.
- Cost of goods sold 322.975.613.285 444.256.868.816 412.091.828.
- Gross profit 31.644.003.463 38.985.097.789 41.484.805.
- Financial Income 1.360.171.932 63.482.127 72.864.
- Financial expense 7.096.360.815 13.000.950.201 15.470.688.
- Selling expenses 8.517.983.145 7.178.086.234 6.720.131.
- Generalexpenses and admin 14.015.503.762 12.521.201.605 12.271.546.
- Other expenses 224.908.502 382.037.141 346.901.
- Operating profit 3.374.327.673 6.348.341.876 7.095.303. Total expenses 29855 ( million) 33081 ( million) 34807 (million)
- Other profit 1.632.010.310 -287.483 -31.362.
- Profit before tax 5.006.337.983 6.348.054.393 7.063.941.
- Net profit after tax 3.954.106.386 4.974.795.187 5.608.509.
- Earning per share
- Ratio Analysis (Times) a) Liquidity ratios Bút Sơn 2017 2018 2019 Current ratio 0.794282247 0.884436852 0. Quick ratio 0.625158855 0.718408447 0. Cash ratio 0.019136254 0.018697007 0. b) Efficiency ratios Bút Sơn 2017 2018 2019 Inventory turnover 8.981902147 9.326671501 8. Day’s sales in inventory 40.63727193 39.13507621 45. Receivables turnover 2.855513718 2.426223324 2. Day’s sales on receivables 127.8228844 150.4395726 164. Assets turnover 0.972527929 1.129517811 1. c) Long-term solvency ratio Bút Sơn 2017 2018 2019 Total Debt Ratio 0.716588639 0.755704436 0. Times Interest Earned 53.67075438 50.57202696 64. Debt Equity Ratio 2.52844006 3.09340221 3. Equity Multiplier 3.52844006 4.09340221 4. Cash Coverage Ratio d) Profitability Ratio Bút Sơn 2017 2018 2019 Profit Margin 0.46 0.693053138 0. Return on Assets (ROA) 1.08 1.16 1. Return on Equity (ROE) 3.83 4.76 5. e) Market Value measures Bút Sơn 2017 2018 2019 Earnings per share 0.66 0.83 0. Price-Earnings Ratio 19.09 14.1 12.
8) PEER EVALUATION FORM Overview: Group members maintained their punctuality strictly. MEMBERS ATTITUDE CONTRIBUTION Nguyễn Kim Tuyến + Work as a responsible leader
Encourage her group to finish their part as fast as they can +Frankly - Critics who submit late
Finished all assigned tasks as discussed before
In charge of the following sections: VI(e), VII
In charge of gathering all parts including The Report and Videos of members Trịnh Anh Nhã Trúc + Work hard. +Help other members in searching information. + Excellent member
Finished all assigned tasks as discussed before +Careful data processing
In charge of the following sections: I); II) Lê Trần Thu Uyên + Work well and instantly update her work based on group feedback without hesitation + Excellent member
Finished all assigned tasks as discussed before +Careful data processing
In charge of the following sections of VI(a->d) Nguyễn Thanh Thiên Uyên
Work very well based on how she wrote her report
The fastest to submit her part
Checking mistakes + Excellent member
Finished all assigned tasks as discussed before
In charge of the following sections of II, III Trịnh Minh Tú + Work well and is very hard-working in his performance
Enthusiasm - Checking mistakes for everyone + Very good member
Finished all assigned tasks as discussed before
In charge of the following sections of V, VIII Nguyễn Văn Viên +Work well but not hard enough to finish his task +Good member
Finished all assigned tasks as discussed before
Searched good reference.
In charge of the following sections of IV, IX
