PRESENTED BY:

NAVEED BHATTI

INTRODUCTION
Crescent Sugar Mills & Distillery Limited is a part of Crescent group A leading position among sugar, industrial alcohol and yarn manufacturers in Pakistan.. Crescent Sugar Mills & Distillery Limited operates in an emerging economy... Pakistan is CSMs home. As such, we are committed to increasing wealth in Pakistan and we have made this, one of our business priorities Crescent Sugar Mills & Distillery Limited engages in the manufacture of sugar, industrial alcohol, and cotton and blended yarn in Pakistan. It also offers molasses, which is by-product of sugar.

WHY THE C .S. M??

THE MAIN REASON OF THE SELECTION OF THIS COMPANY IS TO STUDY THE CRISIS OF SUGER SECTOR IN PAKISTAN THE MAIN REASON FOR THE CURRENT RISE IN SUGAR PRICES ARE CREATED BY THE HOARDERS, WHOLESALERS AND THE MILL OWNERS. THESE THREE PARTIES HAVE CREATED A SORT OF MONOPOLY IN THE COUNTRY. THEY HAVE STARTED STOCKING SUGAR AND THUS DECREASED THE SUPPLY, SO TO INCREASE THE CURRENT PRICE OF SUGAR BECAUSE OF LARGE DEMAND. THEY KNOW THE PRODUCTIVITY OF THE COUNTRY IS DECREASING AND THEY CAN INFLUENCE THE SUPPLY SITUATION TO GAIN ABNORMAL PROFITS.

RATIO ANALYSIS.
LIQUIDITY

RATIO EFFICIENCY RATIO SOLVENCY RATIO PROFITABILITY COVERAGE RATIO MARKET RATIO

LIQUIDITY RATIO
2010
Current Ratio Quick Ratio Inventory days Receivable days 0.72 0.41 51.49 9.80

2009
0.65 0.44 43.91 16.86

2008
0.91 0.56 64.62 15.60

2007
1.25 0.86 73.89 16.66

2006
1.03 0.71 36.92 10.31

Payable days

52.48

59.18

51.88

71.21

26.11

EFFICIENCY RATIO
2010 2009 2008 2007 2006

Receivable Turnover
Inventory Turnover Payable Turnover Fixed Asset Turnover Total Asset Turnover

39.76

21.71

24.46

22.99

37.56

7.09
6.96

8.31
6.17

5.65
7.04

4.94
5.13

9.89
13.98

0.79

3.57

4.28

3.87

4.42

0.63

1.42

1.41

1.11

1.82

SOLVENCY RATIO
2010 Debt Ratio 28% 2009 89% 2008 72% 2007 62% 2006 67%

LONG TERM debt to Capitalization

0.26

0.29

0.12

0.13

0.23

Debt to Equity

9.62

7.97

2.63

1.66

2.04

PROFITABILITY
2010 GROSS PROFIT MARGIN OPERATING PROFIT MARGIN NET PROFIT MARGIN RETURN ON EQUITY RETURN ON ASSETS 2009 2008 2007 2006

6%

0.27%

4%

5%

6%

3% 0.38 %

-4%

2%

1%

1%

-9.19%

-2.36%

-1.79%

-2.78%

8.2% 0.24 %

-117.2% -13.07%

-12.0% -3.32%

-5.3% -1.98%

-15.4% -5.06%

COVERAGE RATIO
2010 TIME INTEREST EARND CASH INTEREST COVERAGE FIXED CHARGE COVERAGE 2009 2008 2007 2006

1.36

-0.79

0.51

0.26

0.38

0.26

1.15

1.31

1.69

2.49

1.36

-0.79

0.51

0.26

0.38

MARKET RATIO....

2010 EARNIG PER SHARE 0.287 DIVIDEND PER SHARE 0.0002

2009

2008

2007

2006

-4.352

-1.440

-1.069

-1.972

0.0075

0.0000

0.0000

0.0000

VERTICAL ANALYSIS.
2010 Sales-net Cost of sales Gross profit Distribution cost Administrative expenses Other operating expenses Operating expenses Other operating income Operating profit Finance cost (Loss)/ profit before tax Taxation (Loss)/ profit after tax 100% 94% 6% 1% 3% 0% 4% 1% 3% 2% 1% 1% 0% 2009 100% 99.7% 0.27% 1% 4% 0% 5% 0% -4% 5% -9% 0.16% -9% 2008 100% 96% 4% 1% 3% 0% 4% 1% 2% 4% -2% 0.50% -2% 2007 100% 95% 5% 1% 3% 0% 4% 1% 1% 4% -1% 0.50% -2% 2006 100% 94% 6% 1% 3% 1% 4% 0% 1% 3% -2% 1% -3%

2010 EQUITY AND LIABILITIES Share capital and reserves Authorized share capital of Rupees 10 each Issued, subscribed and paid up share capital Capital reserves Revenue reserves Unrealized gain on revaluation of investments Total equity 8%

2009

2008

2007

2006

30%

23%

19%

26%

6%
3% 0% 69% 3%

21%
10% 0% 0% 11%

16%
16% 5% 0% 28%

13%
25% 6% 6% 38%

18%
1% 2% 11% 33%

Non-current liabilities Long term financing 1% 0% 5% 1% 4% 1% 5% 0% 10% 0%

Liabilities against assets subject to finance lease Deferred tax

Employees' retirement benefits

0%
0%

0%
0%

0%
0%

1%
0%

2%
1%

Current liabilities

Trade and other payables

9%

23%

19%

21%

12%

Accrued interest on loans and other payables Short term borrowings

0.5% 17%

3% 54%

3% 42%

2% 27%

1% 35%

Current portion of long term liabilities

0.4%

2%

3%

2%

3%

Workers' Profit Participation Fund Provision for taxation

0% 1%

0% 1%

0% 1%

0% 3%

0% 3%

Total current liabilities

Total liabilities TOTAL L&E

27%
28% 100%

83%
89% 100%

68%
72% 100%

55%
62% 100%

55%
67% 100%

HORIZONTAL ANALYSIS
2010 2009 2008 2007 2006

EQUITY AND LIABILITIES Share capital and reserves Authorized share capital of Rupees 10 each Issued, subscribed and paid up share capital Capital reserves Revenue reserves Unrealized gain on revaluation of investments Total equity Non-current liabilities Long term financing Liabilities against assets subject to finance lease Deferred tax

100% 113% 618% 0% 1187% 20% 159% 41% 0% 0% 73%

100% 113% 585% 0% 0% 21% 191% 31% 0% 0% 80%

100% 113% 1211% 60% 0% 68% 209% 29% 0% 0% 86%

100% 113% 2280% 90% 49% 115% 373% 11% 200% 107% 172%

100% 113% 100% 26% 59% 73% 478% 20% 200% 113% 214%

Employees' retirement benefits

Total non-current liabilities

Current liabilities Trade and other payables Accrued interest on loans and other payables Short term borrowings Current portion of long term liabilities Workers' Profit Participation Fund 215% 160% 173% 232% 100%

111% 185%

210% 164%

224% 167%

195% 136%

89% 126%

24% 0% 95% 169%

38% 0% 45% 146%

70% 0% 49% 155%

65% 0% 199% 156%

58% 0% 161% 112%

Provision for taxation

Total current liabilities

Total liabilities TOTAL L & E

159% 311%

139% 85%

147% 111%

158% 138%

123% 100%

2010
ASSETS

2009

2008

2007

2006

Non-current assets Property P & E LT investments

Long term deposits

T. non-current assets

694% 54% 17% 570%

96% 68% 17% 89%

103% 75% 17% 96%

111% 40% 32% 97%

116% 30% 32% 99%

Current assets Stores, spares and loose tools Stock-in-trade Trade debts Advances Prepayments Other receivables Short term investments Cash and bank balances Total current assets TOTAL ASSETS

131% 147% 111% 213% 162% 79% 54% 157% 107% 311%

124% 83% 125% 152% 104% 89% 59% 26% 83% 85%

129% 150% 143% 179% 80% 85% 105% 96% 123% 111%

142% 167% 149% 221% 158% 89% 195% 175% 170% 138%

112% 98% 109% 84% 128% 79% 95% 157% 100% 100%

FINDINGS.
The

sugar industry is not stagnant and it has a potential from which the players of this industry can be benefited. This company is incurring losses because of high cost of sales, the main issue that this company is facing is the transportation cost because plant is deployed far away from the farms of sugar cane. second issue is the recovery of the sugar from sugar cane. Therefore company is not able to generate profit and also not utilizing its assets efficiently. The liquidity condition of the company is at financial risk and is highly leveraged.

RECOMMENDATIONS
The

company should make its processes efficient to lower its cost of sales and operating expense to generate higher revenue Although the financial condition is at risk and firm is reluctant to take any bold decision yet it can invest in such activities which foster its profit growth. They should increase the efficiency of plant utilization They should lower the debt ratio because it is negatively affecting the firms performance.