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Financial Statement Analysis at PT Unilever Indonesia, Tbk.

and Subsidiaries MID-TERM EXAM


The financial statements are an extremely important tool for obtaining information relating to the company's financial position. Financial data will be more easily understood if the data is comparable with using financial ratios. However, in such financial statements need to be done to translate the interpretation of the results already obtained to find out more about the company financial situation and development in accordance with the needs of the parties interested in the company. The benefits of financial statement analysis are as a tool of control of the company to evaluate candidates for corporate management in order to provide input and basis for decision makers. The purpose of this study was to determine the condition of the company's financial ratios seen from the level of liquidity, solvency, profitability and profitability based on data from financial statements for the period 2010 the company is located in the Graha Unilever Jalan Gatot Subroto kav. 15 Jakarta 12930, phone: 021-5262112. The Company is engaged in the production of soaps, detergents, margarine, vegetable oils and foods made from milk, ice cream, food and beverages from teas, and cosmetic products. Advances in technology and developments in consumer tastes are constantly evolving and diverse, it is to pay attention to everyday survival, and the company also gives emphasis on the role of technology and the need for innovation. The analysis showed the results of the four ratios of the company, turned out to PT. Unilever Indonesia, Tbk. on Liquidity ratio is very low because the ratio is far below standard, Solvency ratio is very dangerous for the company in because of inability to meet financial, Profitability ratios cannot be said that the company is profitable because the profit is in the can is less satisfactory. Profitability ratios indicate the company and the company's performance is less good because the company is not able to obtain a net profit but loss.

Comparative Financial Statement Analysis

Year-to-Year Change Analysis. Comparing financial statements over relatively short time periods (for our financial statements are three years-is usually performed with analysis of yearto-year changes in individual accounts. A year-to-year change analysis for short time period is manageable and understandable. It has the advantage of presenting changes in absolute IDR amounts as well as in percentages. In sum, PT Unilever Indonesia is performing well in a though competitive environment.

PT Unilever Indonesia, Tbk. and Subsidiaries Comparative Income Statements

(Expressed in millions of Rupiah, unless otherwise stated) 2010 Net sales Cost of sales Gross profit Selling, general, and administrative expenses Other expense, net Operating profit Interest expense, net Income before income taxes Provision for income taxes Net income Rp Rp Rp Rp Rp Rp Rp Rp Rp Rp 19,690,239 (9,485,274) 10,204,965 (5,662,340) Rp Rp Rp Rp 2009 18,246,872 (9,205,131) 9,041,741 (4,826,850) 43,357 4,258,248 (9,658) 4,248,590 (1,205,236) 3,043,354 Rp Rp Rp Rp Rp Rp Rp Rp Rp Rp Change 1,443,367 (280,143) 1,163,224 (835,490) (17,412) 310,322 (20,269) 290,053 51,241 341,294 % Change 8% 3% 13% 17% -40% 7% 210% 7% -4% 11%

25,945 Rp 4,568,570 Rp

(29,927) Rp 4,538,643 (1,153,995) 3,384,648 Rp Rp Rp

Ratio Analysis
Ratio analysis is among the most popular and widely used tools of financial analysis. 1. Credit (Risk) Analysis a. Liquidity b. Capital structure and solvency 2. Profitability Analysis a. Return on investment b. Operating performance c. Asset utilization

PT Unilever Indonesia, Tbk. and Subsidiaries Ratio Analysis


Current ratio 2010

Current assets Current liabilities

Rp Rp

3,748,130 4,402,940


Acid-test ratio 2010

Cash and cash equivalents + Marketable securities + Accounts receivable Current liabilities Rp Rp (Rp 2,070,392 4,402,940 1,752,633 + Rp 1,348,173)/2 Rp 19,690,239/360 1,550,403 54,695.11

Rp Rp



1,752,633 4,402,940


Collection period 2010

Average accounts receivable Sales/360

Rp Rp



Days to sell inventory 2010

Average inventory Cost of sales/360

Rp 2,914,096/2 Rp -9,485,274/360

Rp Rp 55.30

1,457,048 26,348 days

Capital Structure and Solvency

Total debt to equity 2010

Total liabilities Shareholder's equity Long-term liabilities Shareholder's equity

Rp Rp Rp Rp

4,652,409 4,045,419 249,469 4,045,419


Long-term debt to equity 2010


Time interest earned 2010

Income before income taxes + int. exp. Interest expense

Rp Rp Rp Rp



29,927 29,927

4,568,570 29,927


Return on Investment

Return on assets 2010

Net income + interest exp. X (1 - 0.30) Average total assets

Rp (Rp 8,701,262 Rp Rp Rp Rp 2,390,202.50 8,093,126 3,384,648 3,874,119

2,390,202.50 Rp 7,484,990)/2


Return on common equity 2010

Net income Average shareholder's equity


Operating Performance

Sales - Cost of sales Gross profit margin 2010 = Sales Operating profit margin (pretax) 2010 = Income from operations Sales Net income Sales

Rp 10,204,965 = Rp 19,690,239 = = Rp Rp Rp Rp 4,538,643 19,690,239 = 3,384,648 = 19,690,239



Net profit margin 2010


Asset Utilization
Cash turnover 2010 = Sales Average cash and equivalents Sales Average accounts receivable Cost of sales Average inventory = Rp Rp Rp Rp Rp Rp 19,690,239 588,040.5 = 19,690,239 1,550,403 = 9,485,274.00 1,457,048.00 33.48

Accounts receivable turnover 2010


Inventory 2010


Working capital turnover 2010 PPE turnover 2010

= =

Sales Average working capital Sales Average PPE Sales Average total assets

Rp Rp Rp = Rp = Rp Rp

19,690,239 = (321,143.50) 19,690,239 = 3,592,346.50 19,690,239 = 8,093,126.00

-61.31 5.48

Total asset turnover


Overall, my group brief analysis of liquidity suggests that while Unilevers composition of current assets and current liabilities are cause for concern, its receivables and inventory periods coupled with its excellent cash flow from operations indicate that there is not much cause for concern. To assess Unilevers long-term financing structure and credit risk, my group examines its capital structure and solvency. The analysis of solvency ratio indicates that Unilever will have no problem meeting its fixed charge commitments. In sum, given Unilevers high and stable profitability, its solvency risk is low. My group begins by assessing different aspects of return on investment. Equity holders are especially interested in managements performance based on equity financing, so my group also look at the return on equity.

Cash Flow Analysis

Cash flow analysis is primarily used as a tool to evaluate the sources and uses of funds. Cash flow analysis provides insights into how a company is obtaining its financing and deploying its resources. It also is used in cash flow forecasting and as part liquidity analysis. Unilevers statement of cash flow is a useful starting point for cash flow analysis. Unilever generated IDR 3,619,189 million from operating activities. It then used IDR 1,310,024 million for investing activities, primarily for payment for activities. Overall, Unilevers financing resulted in a net cash outflow to the tune of IDR 2,847,461 million. After accounting for foreign currency exchange rate fluctuations, Unilevers cash flow increased by IDR 538,296 million during 2010.

The company is able to manage the assets with the asset turnover rate reaches a significant value and good, efficiency is made capable of delivering precise results for return on investment. Overall Liquidity Ratio Analysis of the calculation, profitability, and the activity it can be concluded that the company has a good ability to manage and utilize the company's assets, although the company made a loan to a third party to finance the increased investment, but companies can still restore it properly, which is expected by the investment made in the expense of resources will bring turnover rate of return or better on the company, improved earnings from year to year shows the seriousness and focus of management's performance against the company well. That needs to be aware of is that management still consider the company's survival by

taking into account the precautionary principle. Based on the conclusions that have been done, then there are a few advices to consider as input, as follows: Maintain the value of the company's liquidity, which shows in the company's ability to pay current liabilities; The company must be more efficient use of assets owned in its operations to increase revenues or improve net income; Reduce the amount of debt by increasing the provision of funds by shareholders.