Current News and Company Performance - Assignment Example

The paper 'Current News and Company Performance' is a great example of a Finance and Accounting Assignment. Invest Smart News Articles is dated 6th December 2013. It gives an investor a brief overview of the company's performance in the Australian stock exchange. The news later describes Caltex Company limited as a transport company dealing in fuel shipment to different countries. It further gives the company strategic analysis. It states that CTX strategy is based on lifting refinery utilization rates so it can take full advantage of excess demand for refined product in Australia. Lastly the article gives the financial performance and summary for the last three years. The full information is attached in Appendix II below.

• 3.0 Financial performance

a. The table below shows the consolidated comprehensive financial statement for Caltex company limited and its horizontal analysis.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the year ended 31 December 2011

Caltex Company limited

 

 

2011

2010

Horizontal Analysis

 

 

$000

$000

Dollar Change

Percentage Change

Revenue from the sale of goods

22,105,204

18,671,905

3,433,299

18.39%

Cost of sales

20,903,989

- 1,237,358

17,600,469

-1422.42%

Gross Profit

1,201,215

1,071,436

129,779

12.11%

Other Income

296,517

261,174

35,343

13.53%

Employee Benefits Expenses

486,201

418,133

68,068

16.28%

Lease and occupancy expenses

-

-

-

#DIV/0!

Depreciation and amortization expenses

15,552,780

-

15,552,780

#DIV/0!

Advertising, marketing, and visual merchandising expenses

621,334

588,284

33,050

5.62%

Administration expenses

92,788

110,674

- 37,886

-34.23%

Net financing expenses

69,240

59,181

10,059

17.00%

Other expenses

72,788

110,674

- 37,886

-34.23%

Profit before income tax expenses

1,021,767

442,295

579,472

131.01%

Income tax expense

308,546

124,317

184,229

148.19%

Profit after income tax expense

- 713,221.00

317,978

- 1,031,199

-324.30%

b. In the financial year ending December 31st, 2011, the company made a net loss of $ 713,221; this is contrary to the previous year when the company made a net profit of $ 317,978 showing a total percentage decrease in profit from 2010 by - 324.30%.

• 4. 0 Statement for the financial position for the company

a.

Year

2011

2010

Difference

Percentage change

Cash

1,818

18,377

- 16,559

-90.11%

b.payables with a total of $ 1,674.017

c.Equity payable for 2011 is $ 543,415 and for 2010 is $543,415

It remained the same for the two years;

• 5.0Cash flow statement

• Receipt from customer,$25,636,433 (operating activities)
• Net proceeds from sales of property, plant, and equipment = $37,911 (investing activity)
• Proceeds from borrowing $ 12,741,419
• 6.0Financial statement notes
• The accounting principle used is a historical accounting concept where assets are recorded at a historical cost that is the cost at which they were bought. It is also prepared in accordance with the Australian Accounting Standard Board and international financial reporting standards.
• Other important issues in the notes include accounting estimates and judgments, product duties and taxes, cost of goods sold, employees benefits, Amortization among others
• Auditors are KPMG $ 20,0256
• 7.0Accounting is about communicating economic information:

One of the external users of this report is potential investors. The investors are interested in knowing the general company performance and how it is being managed. Of great interest is whether the company makes a profit or not in which the information from the comprehensive income statement will be of greater interest as it will enable the investor to compare the company performance with similar companies in the same industry. All investors want to invest where they will maximize the profit with minimal losses incurred.

• Appendices
  • appendix: company information

 

General Information

Company Name:

Caltex Australia Limited

Stock Code:

X

Website:

www.caltex.com.au

GICS Sub-Industry:

Oil & Gas Refining & Marketing

Market Cap ($M):

5,098

Equiv. Shares (M):

270

• • Appendix II: current news and company performance

Current Broker Consensus Recommendation

 

Recommendation:

Sell

Recommendation Date:

6th Dec 2013

12 Month Target Price (average):

$18.585

Brokers Surveyed:

6

Company Overview

Business Description: Caltex Australia Limited (CTX) is a transport fuel supplier, convenience retailer, and an integrated oil refining and marketing company. It operates two major refineries at Kurnell in Sydney and Lytton in Brisbane. The company also operates with a myriad of subsidiaries; Caltex Australia Custodians, Caltex Australia Petroleum, Caltex Fuel Services, Petroleum Services, Hunter Pipe Line Company, B&S Distributors and Jet Fuels Petroleum Distributors.

Strategy Analysis: CTX strategy is based on lifting refinery utilization rates so it can take full advantage of excess demand for the refined product in Australia. Refiner margins can be volatile but high refinery utilization rates and strong marketing activities are important in driving operating cash flow and earnings. This allows for the reduction of debt levels and improving the return on equity and the return to shareholders. The alliance with Woolworths underpins volume growth. The CEO aims to lift CTX into the top quartile in terms of total shareholder return and to eliminate earnings volatility - a very big task. Caltex Australia reported NPAT of $57.6m for the year ended 31 December 2012. This includes significant items of approximately $309.0m (after-tax), which primarily relates to provisions in respect of the closure of the Kurnell refinery. This compares favorably to the 2011 after-tax loss of $713.22m, which included significant items of $1.12bn (after tax) relating to the refinery impairment. The 2012 result includes product and crude oil inventory losses of $92.0m after-tax, compared with an inventory gain of $138.0m after-tax in 2011. Revenues from ordinary activities were $23.26bn, up 5% from last year. Basic and Diluted EPS was 21.0 cents compared to (264.3) cents last year. Net operating cash flow was $399.74m compared to $446.4m last year. The final dividend declared was 23.0 cents, taking the full-year dividend to 40.0 cents compared with 45.0 cents last year.

Financial Summary

Year to Dec

NPAT

EPS

EPS (%)

PER

DPS

Yield (%)

Franking (%)

2014  F

406.5

148.9

-7.7

12.7

104.0

5.5

100.0

2013  F

440.6

161.4

-3.8

11.7

58.0

3.1

100.0

2012  A

458.0

167.7

73.0

8.8

40.0

2.7

100.0

Source: Morningstar analyst estimates.

Peer Comparison

 

EPS Growth (%)

P/E (%)

Dividend Yield (%)

Company

Mkt Cap

2012 A

2013 F

2014 F

2012 A

2013 F

2014 F

2012 A

2013 F

2014 F

Caltex (CTX)

$5,127 M

-0.5641

0.1911

-0.0773

14.0179

11.7687

12.7552

0.0211

0.0305

0.0548

Market Comparison

 

Earnings

P/E Ratio

P/B Ratio

P/E Growth

P/S Ratio

X

1.60

11.8

2.37

2.45

0.22

Market

1.08

14.9

1.23

1.99

1.61

Sector

1.62

12.5

0.77

4.09

6.59

Directors

Name

Position

Start Date

Mr. Peter Wissel

Alternate Director for Mr. Fish and Mr. Jones-Cervantes

23 August 2005

Mr. Julian Segal

Chief Executive Officer, Managing Director

01 July 2009

Ms. Elizabeth Bloomfield Bryan

Non-Executive Chairman

18 July 2002

Mr. Greig Gailey

Non-Executive Director

11 December 2007

Mr. Trevor Bourne

Non-Executive Director

02 March 2006

Mr. Bruce Morgan

Non-Executive Director

29 June 2013

Ms. Barbara Burger

Non-Executive Director, Alternate Director - Mr. Richard Brown and Mr. Ryan Krogmeier

28 June 2012

Mr. Ryan Krogmeier

Non-Executive Director, Alternate Director - Mr. Richard Brown and Ms. Barbara Burger

30 March 2012

Mr. Richard Brown

Non-Executive Director, Alternate Director - Ms. Barbara Burger and Mr. Ryan Krogmeier

28 June 2012

Management

Name

Position

Simon Hepworth

Chief Financial Officer

Peter Lim

Company Secretary

Katie King

Company Secretary

Simon Willshire

General Manager - Human Resources

Andy Walz

General Manager - Marketing

Gary Smith

General Manager - Refining & Supply

Mike McMenamin

General Manager - Strategy, Planning, and Development

Calendar of Events

Date

Event

25 August 2014

Report (Interim)

21 August 2014

Report (Interim)

27 March 2014

Report (Annual)

24 February 2014

Report (Prelim)

21 February 2014

Report (Prelim)

© 2011 Morningstar, Inc. All rights reserved. The data and content contained herein are not guaranteed to be accurate, complete, or timely. Neither Morningstar nor its affiliates nor their content providers will have any liability for the use or distribution of any of this information. To the extent that any of the content above constitutes advice, it is general advice that has been prepared by Morningstar Australasia Pty Ltd ABN: 95 090 665 544, AFSL: 240892 (a subsidiary of Morningstar, Inc.), without reference to your objectives, financial situation or needs. Before acting on any advice, you should consider the appropriateness of the advice and we recommend you obtain financial, legal, and taxation advice before making any financial investment decision. If applicable investors should obtain the relevant product disclosure statement and consider it before making any decision to invest. Some material is copyright and published under license from ASX Operations Pty Limited ACN 004 523 782 ("ASXO"). DISCLOSURE: Employees may have an interest in the securities discussed in this report. Please refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/fsg.asp.

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  • Appendix iii: consolidated statement of comprehensive income

• • Appendix IV: Statement for the financial position for the company

• • Appendix V: Cash Flow statement for the Company

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• • Appendix VI: Financial Notes of the Company

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