Section 1 PSO Introduction • Pakistan State Oil Company Limited (PSO) is serving the nation as an innovative and dynamic energy Company with a vision of delivering value to the customers since 1976. • have the largest liquid fuel storage in the country • PSO is serving its esteemed customers through both retail and consumer sites • Has 3,487 outlets across Pakistan wherein, more than 2,020 Retail and Consumer Business outlets • Company Operated sites also supplement PSO’s vision of providing quality customer care VERTICAL ANALYSIS(BALANCE SHEET) ASSETS Non-current assets Current assets TOTAL ASSETS 2021 % 70853570 343075216 413928786 Total Equity Non-current liabilites Current Liabilites Total Equity and Liabilities 142,372,937 13,058,474 258,497,375 413,928,786 17.12% 82.88% 100.00% 2020 % 70,629,671 304,600,951 374,046,029 34.40% 3.15% 62.45% 100.00% 113,977,581 17,300,293 243,952,748 375,230,622 18.88% 81.43% 100.00% 2019 56127481 397472392 453,599,873 12.37% 87.63% 100.00% 30.38% 4.61% 65.01% 100.00% 128,445,411 12,177,177 312,977,285 453,599,873 28.32% 2.68% 69.00% 100.00% s - net INCOME STATEMENT VERTICAL ANALYSIS 2021 Amount Percentage 1,223,678,351 100.00% -1,166,423,044 -95.32% 57,255,307 4.68% 19,415,472 1.59% 0.00% -12,022,223 -0.98% -3,715,366 -0.30% -898,265 -0.07% -4,053,521 -20,689,375 55,981,404 -11,553,734 574,953 45,002,623 -15,445,368 29,557,255 -0.33% -1.69% 4.57% -0.94% 0.05% 3.68% -1.26% 2.42% Vertical Analysis 2020 Amount Percentage 1,121,161,417 100.00% -1,114,241,883 -99.38% 6,919,534 0.62% 10,385,641 0.93% 0.00% -11,771,399 -1.05% -3,682,218 -0.33% 169,215 0.02% -257,473 -15,541,875 1,763,300 -15,393,332 546,931 -13,083,101 -1,679,384 -14,762,485 -0.02% -1.39% 0.16% -1.37% 0.05% -1.17% -0.15% -1.32% 2019 Amount Percentage 1,185,484,132 100.00% -1,152,674,631 -97.23% 32,809,501 2.77% 16,922,354 1.43% 0.00% -10,414,831 -0.88% -2,900,105 -0.24% -306,373 -0.03% -4,377,571 -17,998,880 31,732,975 -9,955,428 199,922 21,977,469 -6,870,536 15,106,933 -0.37% -1.52% 2.68% -0.84% 0.02% 1.85% -0.58% 1.27% HORZONTAL ANALYSIS(BALANCE SHEET) 2019-2020 2021 2020 ASSETS Non-current assets Current assets TOTAL ASSETS 70,853,570 343,075,216 413,928,786 70,629,671 304,600,951 374,046,029 Total Equity Non-current liabilites Current Liabilites Total Equity and Liabilities 142,372,937 13,058,474 258,497,375 413,928,786 113,977,581 17,300,293 243,952,748 375,230,622 increase/decrease % 223899 38474265 39882757 28395356 -4241819 14544627 38698164 0.32% 12.63% 10.66% 24.91% -24.52% 5.96% 10.31% Gross Profit ( In respect to sales) • Was Rs 32,809,501 (2.77%) in 2019, decreased to Rs 6,919,534 (0.62%) in 2020, increased to Rs 57,255,307 (4.68%) Operating profit ( In respect to sales) INTERPRETATION VERTICAL ANALYSIS OF INCOMESTATEMENT • Was Rs 31,732,975 (2.68%) in 2019, decreased to Rs 1,763,300 (0.16%) in 2020, increased to Rs 55,981,404 (4.57%) Financial costs ( In respect to sales) • Was Rs 6,870,536 (0.58) in 2019, decreased to Rs 1,679,384 (0.15) in 2020, increased to Rs 15,445,368 (1.26%) Profit/losses ( In respect to sales) • Was Rs 15,106,933 (1.27%) in 2019, decreased to Rs 14,762,485 (1.32%) in 2020, increased to Rs 29,557,255 (2.42) in 2021 INCOME STATEMENT (HORIZONTAL ANALYSIS) 2019-2020 2019 Net sales Cost of products sold Gross profit Other income Operating costs Distribution and marketing expenses Administrative expenses (Provision) / reversal of provision for impairment on financial assets - net Other expenses Total expenses Profit from operations Finance costs Share of profit of associates - net of tax Profit / (loss) before taxation Taxation Profit / (loss) for the year Increase/Decrease Amount percentages 2020 2019 to 2020 1185484132 -1152674631 32809501 16922354 1121161417 -1114241883 6919534 10385641 64322715 -38432748 25889967 6536713 5.74% 3.45% 374.16% 62.94% -10414831 -2900105 -306373 -4377571 -17998880 31732975 -9955428 199922 21977469 -6870536 15106933 -11771399 -3682218 169215 -257473 -15541875 1763300 -15393332 546931 -13083101 -1679384 -14762485 1356568 782113 -475588 -4120098 -2457005 29969675 5437904 -347009 35060570 -5191152 29869418 -11.52% -21.24% -281.06% 1600.21% 15.81% 1699.64% -35.33% -63.45% -267.98% 309.11% -202.33% INTERPRETATION INCOME STATEMENT (HORIZONTAL ANALYSIS) 2019-2020 2019 2020 Sales in 2019 were 5.74% more than the sales in 2020 Distribution expenses were 11.52% more in2020 than in 2019 Gross profit in 2019 was 3.45% more than in 2020 Profits in 2019 were changed into losses in 2020 as the profits decreased by 202.3% 2019 2020 RATIOS Current Position Analysis 2021 2020 2019 current Assets 343075216 304,600,951 397,472,392 current liabilities 258497375 243,952,748 312,977,285 Working Capital Working capital = Current Assets- Current Liabilities Working capital 84577841 60648203 84495107 Current Ratio Current ratio= current assets/ current liabilities Current Ratio 1.32719 1.248606 1.269972 Quick Ratio Quick Ratio= Quick Assets/ current Liabilities Quick Ratio 1.298382 1.200186 1.227852 Account Receivable Analysis Account Receivable Turnover = sales/ average Account Receivables 2021 2020 2019 Sales 1223678351 1121161417 1185484132 Receivable at start 221931948 280594952 278594706 Receivable at end 243719689 221931948 280594952 Total 465651637 502526900 559189658 Average Account receivable 232825818.5 251263450 279594829 Account Receivable Turnover 5.255767418 4.462095132 4.240007357 Average Daily Sales 3352543.427 3071675.115 3247901.732 Number of Day sales in receivables 69.44751755 81.80013855 86.08475629 INVENTORY ANALYSIS Inventory Turnover Inventory Turnover= Cost of goods sold/ average inventory 2021 2020 2019 cost of goods sold 1,166,423,044 1,114,241,883 1,152,674,631 Average Inventory 69100891 74631070.5 88259925.5 Inventory Turnover 16.8800001 14.93 13.06 Number of Days’ Sales in Inventory Number of Days’ Sales in Inventory = Average Inventory/ Average Daily Cost of Goods Sold Average Inventory 2021 69100891 2020 74631071 2019 88259926 Average Daily Cost of Goods Sold 3195680 3052717 3158013 Number of days sales in inventory 21.6232 24.4474 27.9479 Solvency Ratios Fixed Assets Long term Liabilities Ratio of Fixed Assets to Long-Term Liabilities 2021 2020 70853570 70629671 13058474 17300293 Ratio of fixed asset to long term liability 5.425869056 4.082570798 2019 56127481 12177177 4.609235868 Ratio of liabilities stockholder's equity 2021 2020 2019 Total Liabilities 271555849 261253041 325154462 Total Stockholder's equity 142372937 113977581 128445411 Ratio of liabilities stockholder's equity 1.907355813 2.29214411 2.531460326 Probability Measures Asset Turnover Return on Total Assets Return on stockholders’ equity Effect of Leverage Earnings per share (EPS) Price-Earnings (P/E) Ratio Dividend Yield Dividend Yield 2021 2020 2019 3.11 0.08 0.23 -0.18 62.10 3.60 0.07 0.07 2.71 -0.04 -0.13 0.11 -13.80 -11.50 NONE NONE 2.77 0.04 0.13 -0.24 22.50 7.20 0.06 0.06 SECTION 2 Attock • Commenced in 1998 • UK Domiciled company • 3rd largest OMC on the basis of aggregate market share • 4th Oil Marketing Company in Pakistan to be granted a marketing license Introduction • Mission Statement • “to continuously provide quality and environment friendly petroleum products and related services to industrial, commercial and retail consumers, and exceeding their expectations through reliability, economy and quality of products and services. We are committed to benefiting the community and ensuring the creation of a safe, responsible and innovative environment geared to client satisfaction, end user gratification, employee’s motivation and shareholder’s value.” • Horizontal Analysis 2020-2021 • Net Sales Decrease • Gross profit increase • Finance Cost Decrease • Profit for the Year Increase • Horizontal Analysis(2020-2019) • Sales Increase • Gross Profit Increase • Finance Cost Decrease • Profit for the year Increase Horizontal analysis 20212020 • Share Capital And Reserves Increase • Non-current Liabilities Increase • Current liabilities Increase Horizontal analysis 2021-2020 • Long term investments Increase • Current Assets decrease Vertical Analysis 2021 • Sales Tax • Cost of Goods Sold • Operating Expenses • Finance Cost • Profit for the year Vertical Analysis 2020 • Sales Tax • Cost of Goods Sold • Operating Expenses • Finance Cost • Profit for the year Vertical Analysis 2019 • Sales Tax • Cost of Goods Sold • Operating Expenses • Finance Cost • Profit for the year Vertical Analysis 2021 Vertical Analysis 2021 • Non-current Assets • Current Assets Vertical Analysis 2020 Vertical Analysis 2020 • Non current Assets • Current Assets Vertical Analysis 2019 • Share Capital • Non current Liabilities • Current Liabilities Vertical Analysis 2019 • Non current Assets • Current Assets RATIOS Liquidity Ratio • Better Liquidity in the year 2019 and 2021 • Working Capital improved in 2019 and 2021 • Quick Ratio was better in 2020 and 2019 • Better debt paying ratio Working Capital current assets- current liabilities 2021 2020 2019 Current Assets 44,210,980 35,526,138 37,102,945 Current liabilities 31795455 27908728 26682984 result 12,415,525 7,617,410 10,419,961 Current Ratio current assets/ current liabilities 2021 2020 2019 Current Assets 44,210,980 35,526,138 37,102,945 current liabilities 31795455 27908728 26682984 results 1.390481124 1.272940064 1.390509585 Quick ratio current assets-stocks/ liabilities 2021 2020 2019 Current Assets 44,210,980 35,526,138 37,102,945 current liabilities 31795455 27908728 26682984 Stocks 16121539 9464503 12,865,862 Results 0.88344202 0.933816654 0.908334802 Liquidity Ratio • Efficiency in collecting ratio • Accounts Receivables turnover improved in the year 2021 • Number of Days in Sales receivables better in year 2019 and 2020 Sales Accounts Receivables Average Receivables Results Accounts Receivable turnover Sales/Average accounts receivables 2021 2020 2019 188645375 201078720 223054352 11,025,245 13,970,178 2018 16,838,255 16,475,576 12,497,712 15,404,217 16,656,916 15.09439348 13.05348571 13.39109585 Number of days in sales receivables Average Account receivables/ Average daily sales 2021 2020 2019 2018 Accounts Receivables 11,025,245 13,970,178 16,838,255 16,475,576 Average Receivables 12,497,712 15,404,217 16,656,916 Sales 188645375 201078720 223054352 Average daily sales 516836.6438 550900.6027 611107.8137 Result 24.18116372 27.96187992 27.25691789 Liquidity Ratio • Measures Companies efficiency in managing inventory • Inventory turnover better in the year 2020 • Number of Day’s sales in inventory better in the year 2021 Inventory turnover Cost of Good Sold/Average Inventory 2021 2020 2019 2018 Cost of Goods sold 178663434 197440830 214833185 Stocks 16121539 9464503 12,865,862 12,460,539 Average Inventory 12793021 11165182.5 12663200.5 Results 13.96569536 17.6836187 16.96515703 Number of day's sales in inventory Average inventory/average daily cost of goods sold 2021 2020 2019 2018 16121539 9464503 12,865,862 12,460,539 Stocks Average Inventory 12793021 11165182.5 12663200.5 6230269.5 Cost of goods sold 178663434 197440830 214833185 167,473,443 Average daily cost of good sold 489488.8603 540933.7808 588584.0685 458831.3507 Results 26.13546914 20.64057172 21.51468444 Solvency Measure • Ratio of Fixed Assets to long term liabilities • Measures Margin of safety available long term creditors • Significantly higher in the year 2019 • Ratios of Liabilities to Stockholder’s Equity • How much of the company is managed by debt and equity • Higher in the year 2021 and 2020 Ratio of Fixed Assets to long term liabilites Fixed Assets(net)/Long term laibilities 2021 2020 2019 Fixed Assets 17,686,905 15,712,914 9,299,767 long term laibilites 7,381,496 4,883,583 792,993 Results 2.3961139 3.2174971 11.7274263 Ratios of liabilites to stockholder's equity Total liabilities/ total stakeholder's equity 2021 2020 2019 Current liabilities 31,795,455 27,908,728 26,682,984 Non current liabities 7,381,496 4,883,583 792,993 total stock holders equity 22,720,934 18,446,021 18,926,735 Results 1.7242667 1.7777444 1.45170189 Solvency Measure • Times interest Paid • Measures the Risk that interest payment will not be made if earning decrease • Significantly higher in 2019 Times interest earned (income before tax+ interest tax)/Interest expense 2021 2020 2019 income before tax 6939058 1503086 5722857 Finance cost 1418918 1597199 848992 5.8903869 1.9410762 7.7407667 Results Sales total Assets Average total assets Results Assets Turnover Sales/Average total assets 2021 2020 2019 188645375 201078720 223054352 61,897,885 51,238,332 46,402,712 56568108.5 48820522 23201356 3.334836182 4.118733511 9.613849811 Net income interest expense total Assets Average total assets results Return on total assets (net income+interest expense)/average total assets 2021 2020 2019 2018 4919632 1008294 3960606 1418918 1597199 848992 61,897,885 51,238,332 46,402,712 46,131,326 56568108.5 48820522 46267019 0.112051652 0.053368807 0.103953056 Profitably Ratio • Assets Turnover • Measures how effectively a company uses its assets • Better in the year 2019 • Return on Total Assets • Measures the profitably of company’s assets • Better in 2021 and 2019 • Return on stakeholder’s equity • Measures the profitability of the investment of stockholder • Better in 2021 and 2019 Return on stake holder's equity net income/average total stakeholder's equity 2021 2020 2019 total stock holders equity 22,720,934 18,446,021 18,926,735 18,417,662 average total stockhoder's equity 20583477.5 18686378 18672198.5 Net income 4919632 1008294 3960606 results 0.239008788 0.053958771 0.212112462 Profitably Ratio • Measures the profitability of the investment by common stockholder • Return on Common Stock holder’s equity • Significantly higher in 2021 and 2019 • Earnings Per share(EPS) • Significantly higher in 2021 and 2019 Net income preferred dividends common shares rettined earning Average common stockholder's equity results Net income preferred dividends common shares outstanding results Return on common stockholder's equity Net income-preferred dividends/average common stockholder's equity 2021 2020 2019 2018 4919632 1008294 3960606 0 0 1,500,000 1,500,000 21,505,635 17,230,838 0 1,500,000 1,500,000 17,711,622 17,338,188 19368236.5 17471230 17524905 25.40051594 5.7711678 22.59987144 Earnings Per share (EPS) (net income-preferred)/ shares of common stock outstanding 2021 2020 2019 4919632 1008294 3960606 0 0 0 99,533 99,533 99,533 49.42714477 10.13024826 39.79188812 Price earning ratio Market price/ EPS Profitably Ratio • Price Earing Ratio • Measures future earning prospects based on the relationship between market value of common stock earnings • Better in 2020 • Dividends per share • Measures the extent to which earnings are being distributed to common stockholders • Higher in 2021 • Dividend Yield • Measures the dividends the company makes by investing in the company • Similar in all the years EPS market price results 2021 2020 49.42 10.13 319.2 305.21 6.458923513 30.12931885 2019 39.79 288.47 7.24981151 Dividends pershare dividends on common stock/ share of common stock outstanding 2021 2020 2019 Dividends on common stock common shares outstanding results 2,687,386 895,795 1,990,656 99,533 99,533 99,533 26.99994977 8.999979906 19.99995981 Dividend yeild Dividend per share of common stock/market price pershare of common stock dividends pershare market price results 27 9 319.2 305.21 0.084586466 0.029487894 20 288.47 0.0693313 SECTION 3 COMPANIES COMPARISON Horizontal AnalysisBalance Sheet Non-current assets current assets Total assets 2021-2020 PSO ATTOCK % % 0.32 12.57 12.63 24.45 10.66 20.84 2019-2020 PSO % -20.53 30.49 21.27 ATTOCK % -68.95 4.44 9.44 Total Equity Non-current liabilities Current liabilities 24.91 -24.52 5.96 23.175 51.149 13.926 12.69 -29.61 28.29 2.60 -83.76 -4.392 Total Equity and Liabilities 10.31 20.80 20.89 -9.43 Vertical Analysis - Balance Sheet Vertical Analysis Balance Sheet 2021 PSO ATTOCK % % 2020 PSO ATTOCK % % 2019 PSO ATTTOCK % % non-current assets 17.12 28.57 18.88 30.66 12.37 20.04 current assets Total assets 82.88 100 71.42 100 81.43 100 69.33 100 87.63 100 79.95 100 Total Equity 34.40 36.7 30.38 36 28.23 40.79 Non-current liabilities 3.15 11.92 4.61 9.53 2.68 1.709 Current liabilities 62.45 51.37 65.01 54.4 69 57.5 Total Equity and Liabilities 100 100 100 100 100 100 Horizontal Analysis- income statement 2020-21 2019-20 PSO ATTOCK PSO ATTOCK % % % % Sales 9.14% -6.11% 5.74% -8.15% Cost of sales 4.68% -9.51% 3.45% -8.10% Gross Profit 727.44% 174.39% 374.16% -55.75% Other income 86.95% 41.18% 62.94% -21.75% Selling and distribution cost 2.13% -209.35% -11.52% 428.24% Administraive expenses 0.90% 34.85% -21.24% -14.25% Other expense 1474.35% 331.49% 1600.21% -62.37% Operating profit 3074.81% 591.99% 1699.64% -81.01% Finance cost -24.94% -11.16% -35.33% 88.13% profit before taxation -443.98% 361.65% -267.98% -73.74% Taxation 819.70% 308.14% 309.11% -71.92% Profit for the year -300.22% 387.92% -202.33% -74.54% Vertical Analysis Income statement Sales Cost of sales Gross Profit Other income PSO ATTOCK PSO ATTOCK PSO ATTOCK % % % % % % 100.00% 95.32% 4.68% 1.63% 100.00% 80.72% 4.51% 0.57% 100% 99.38% 0.62% 0.98% Selling and distribution cost 0.98% 0.18% Administrative expenses Other expense 0.30% 0.40% Operating profit Finance cost profit before taxation Taxation Profit for the year 83.76% 1.54% 0.38% 100% 97.23% 2.77% 1.53% 83.70% 3.20% 0.45% 1.05% 0.16% 0.88% 0.03% 1.88% -0.23% 0.33% 0.01% 1.31% 0.05% 0.24% 0.42% 1.40% 0.12% 4.57% 3.39% 0.16% 0.46% 2.68% 2.22% 0.94% 3.68% 1.26% 2.42% -0.64% 3.14% -0.91% 2.22% 1.37% 1.17% 0.15% 1.32% 0.68% 0.64% 0.21% 0.43% 0.84% 1.85% 0.58% 1.27% 0.33% 2.23% 0.69% 1.54% Ratios Ratio of fixed assets to long term liabilities Ration of liabilities to stockholder's equity Times interest earned A/R turnover Number of days sales in receivable Inventory Turnover Number of Days Sales in inventory PSO ATTOCK PSO ATTOCK PSO ATTOCK 5.426 2.396 4.082 3.217 4.609 11.727 1.907 1.724 2.292 1.778 2.531 1.452 5.89 1.941 7.74 5.256 15.094 4.462 13.053 4.24 13.391 69.447 24.181 81.8 27.961 86.085 27.257 16.88 13.965 14.93 17.683 13.06 16.965 21.623 26.135 24.447 20.64 27.947 21.514 2021 PROFITABILITY MEASURES 2020 2019 PSO ATTOCK PSO ATTOCK PSO ATTOCK Assets Turnover 3.106 3.335 2.709 4.119 2.769 9.614 Return on total assets 0.075 0.112 -0.0357 0.0533 0.0353 0.207 Return on stockholder's equity 0.2338 0.239 -0.125 0.0539 0.129 EPS on CS 62.1 49.427 -13.8 10.13 22.5 38.792 Price Earnings Ratio 3.6 6.4589 -11.5 30.129 7.2 7.249 Dividend per year 15 26.999 none 8.999 10 19.999 Dividend yield 0.067 0.0845 none 0.0295 0.062 0.0693 Conclusion • Attock is much better financial position than PSO • PSO need to improve its position • Need more efficiency in account receivable methods • It should also increase the return to its shareholders.