Sherwood "Shakey"

Johnson and
Ed Plummer
 SHAKEY'S PIZZA ASIA VENTURES INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

Trend Analysis
Analysis
2017 2016 Increase/Decrease %

ASSETS

Current Assets
Cash and cash equivalents 244,994,340.00 328,531,651.00 -83,537,311 -25%
Financial Assets at Fair Value through Profit or Loss
Available-for-sale (AFS) investments 1,125,173,721.00 -1,125,173,721 -100%
Trade and other receivables 586,496,825.00 420,824,917.00 165,671,908 39%
Current Portion of Loans to related parties
Inventories 362,206,579.00 256,285,224.00 105,921,355 41%
Prepayments and other current assets 61,438,393.00 13,309,956.00 48,128,437 362%

Trend
Total Current Assets 1,255,136,137.00 2,144,125,469.00 -888,989,332 -41%

Noncurrent Assets
Property and equipment 1,538,385,394.00 999,005,919.00 539,379,475 54%
Goodwill 1,078,606,020.00 1,078,606,020.00 0 0%
Trademarks 4,987,109,602.00 4,987,109,602.00 0 0%
Loans to related parties- net of current portion
Deferred Input Value-Added Tax 95,666,175.00 40,257,683.00 55,408,492 138%
Deferred Tax Assets - net 25,100,727.00 29,905,937.00 -4,805,210 -16%
Rental and other Noncurrent Assets 128,843,614.00 105,448,858.00 23,394,756 22%
Total Noncurrent Assets 7,853,711,532.00 7,240,334,019.00 613,377,513 8%
TOTAL ASSETS 9,108,847,669.00 9,384,459,488.00 -275,611,819 -3%
 SHAKEY'S PIZZA ASIA VENTURES INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

Trend Analysis
Analysis
2017 2016 Increase/Decrease %
LIABILITIES AND EQUITY

Current Liabilities
Accounts payable and other current liabilities 1,005,167,485.00 864,310,981.00 140,856,504 16%
Current portion of loans payable 48,411,689.00 1,048,365,917.00 -999,954,228 -95%
Income tax payable 59,139,697.00 64,438,143.00 -5,298,446 -8%
Total Current Liabilities 1,112,718,871.00 1,977,115,041.00 -864,396,170 -44%

Noncurrent Liabilities
Loans payable - net of current portion 3,885,420,461.00 3,933,241,406.00 -47,820,945 -1%

Trend
Accrued pension costs 25,134,979.00 34,334,511.00 -9,199,532 -27%
Accrued rent 76,181,330.00 64,171,062.00 12,010,268 19%
Dealers' deposits and other noncurrent liabilities 35,150,922.00 16,520,343.00 18,630,579 113%
Total Noncurrent Liabilities 4,021,887,692.00 4,048,267,322.00 -26,379,630 -1%
TOTAL LIABILITIES 5,134,606,563.00 6,025,382,363.00 -890,775,800 -15%

Equity
Capital Stock 1,531,321,053.00 1,531,321,053.00 0 0%
Additional paid-in-capital 1,353,554,797.00 1,353,554,797.00 0 0%
Retained Earnings 1,095,525,015.00 486,513,796.00 609,011,219 125%
Other Component of Equity 6,159,759.00 12,312,521.00 6,152,762 -50%
Total Equity 3,974,241,106.00 3,359,077,125.00 615,163,981 18%
TOTAL LIABILITIES AND EQUITY 9,108,847,669.00 9,384,459,488.00 -275,611,819 -3%
 SHAKEY'S PIZZA ASIA VENTURES INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Trend Analysis
Analysis
2017 2016 Increase/Decrease %
REVENUES
Net sales 6,750,949,174 5,738,977,478 1,011,971,696 17.63%
Royalty and franchise fees 252,863,907 206,631,050 46,232,857 22.37%
7,003,813,081 5,945,608,528 1,058,204,553 17.80%
COSTS OF SALES 4,937,716,670 4,158,600,507 779,116,163 18.74%
GROSS INCOME 2,066,096,411 1,787,008,021 279,088,390 15.62%

Trend
GENERAL AND ADMINISTRATIVE EXPENSES 905,415,529 984,652,184 79,236,655 -8.05%
INTEREST EXPENSE 177,304,646 128,490,292 48,814,354 37.99%
OTHER INCOME - Net 38,807,186 262,353,688 223,546,502 -85.21%
INCOME BEFORE INCOME TAX 1,022,183,422 936,219,233 85,964,189 9.18%
PROVISION FOR (BENEFIT FROM) INCOME TAX
Current 258,100,841 184,883,829 73,217,012 39.60%
Deferred 1,939,257 7,849,801 9,789,058 -124.70%
260,040,098 177,034,028 83,006,070 46.89%
NET INCOME 762,143,324 759,185,205 2,958,119 0.39%
 STATEMENTS OF FINANCIAL POSITION
2017 2016

Analysis
Analysis
SizeAnalysis
ASSETS

Current Assets
Cash and cash equivalents 244,994,340 2.69% 328,531,651 3.50%
Financial Assets at Fair Value through Profit or Loss - - - -
Available-for-sale (AFS) investments - - 1,125,173,721 11.99%
Trade and other receivables 586,496,825 6.44% 420,824,917 4.48%

Size
CommonSize
Current Portion of Loans to related parties - - - -
Inventories 362,206,579 3.98% 256,285,224 2.73%
Prepayments and other current assets 61,438,393 0.67% 13,309,956 0.14%

Common
Total Current Assets 1,255,136,137 13.78% 2,144,125,469 22.85%

Common
Noncurrent Assets
Property and equipment 1,538,385,394 16.89% 999,005,919 10.65%
Goodwill 1,078,606,020 11.84% 1,078,606,020 11.49%
Trademarks 4,987,109,602 54.75% 4,987,109,602 53.14%
Loans to related parties- net of current portion - - - -
Deferred Input Value-Added Tax 95,666,175 1.05% 40,257,683 0.43%
Deferred Tax Assets - net 25,100,727 0.28% 29,905,937 0.32%
Rental and other Noncurrent Assets 128,843,614 1.41% 105,448,858 1.12%
Total Noncurrent Assets 7,853,711,532 86.22% 7,240,334,019 77.15%
TOTAL ASSETS 9,108,847,669 100.00% 9,384,459,488 100.00%
 STATEMENTS OF FINANCIAL POSITION
2017 2016

Analysis
Analysis
SizeAnalysis
LIABILITIES AND EQUITY

Current Liabilities
Accounts payable and other current liabilities 1,005,167,485 11.04% 864,310,981 9.21%
Current portion of loans payable 48,411,689 0.53% 1,048,365,917 11.17%
Income tax payable 59,139,697 0.65% 64,438,143 0.69%
Total Current Liabilities 1,112,718,871 12.22% 1,977,115,041 21.07%

Size
CommonSize
Noncurrent Liabilities
Loans payable - net of current portion 3,885,420,461 42.66% 3,933,241,406 41.91%
Accrued pension costs 25,134,979 0.28% 34,334,511 0.37%

Common
Accrued rent 76,181,330 0.84% 64,171,062 0.68%

Common
Dealers' deposits and other noncurrent liabilities 35,150,922 0.39% 16,520,343 0.18%
Total Noncurrent Liabilities 4,021,887,692 44.15% 4,048,267,322 43.14%
TOTAL LIABILITIES 5,134,606,563 56.37% 6,025,382,363 64.21%

Equity
Capital Stock 1,531,321,053 16.81% 1,531,321,053 16.32%
Additional paid-in-capital 1,353,554,797 14.86% 1,353,554,797 14.42%
Retained Earnings 1,095,525,015 12.03% 486,513,796 5.18%
Other Component of Equity -6,159,759 -0.07% -12,312,521 -0.13%
Total Equity 3,974,241,106 43.63% 3,359,077,125 35.79%
TOTAL LIABILITIES AND EQUITY 9,108,847,669 100.00% 9,384,459,488 100.00%
 INCOME STATEMENT

Analysis
Analysis
2017 2016

SizeAnalysis
Net sales 6,750,949,174 96.39% 5,738,977,478 96.52%
Royalty and franchise fees 252,863,907 3.61% 206,631,050 3.48%
TOTAL REVENUES 7,003,813,081 100.00% 5,945,608,528 100.00%
COSTS OF SALES 4,937,716,670 -70.50% 4,158,600,507 -69.94%

Size
CommonSize
GROSS INCOME 2,066,096,411 29.50% 1,787,008,021 30.06%

GENERAL AND ADMINISTRATIVE EXPENSES 905,415,529 -12.93% 984,652,184 -16.56%

Common
Common
INTEREST EXPENSE 177,304,646 -2.53% 128,490,292 -2.16%
OTHER INCOME - Net 38,807,186 0.55% 262,353,688 4.41%
INCOME BEFORE INCOME TAX 1,022,183,422 14.59% 936,219,233 15.75%
PROVISION FOR (BENEFIT FROM) INCOME TAX
Current 258,100,841 3.69% 184,883,829 3.11%
Deferred 1,939,257 0.03% 7,849,801 -0.13%
260,040,098 3.71% 177,034,028 2.98%
NET INCOME 762,143,324 10.88% 759,185,205 12.77%
 SHAKEY'S PIZZA ASIA VENTURES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

December 31
2017 2016

CASH FLOWS FROM OPERATING ACTIVITIES

Income before income tax 1,022,183,422 936,219,233
Adjustments for:
Gain on reversal of advances 222,502,148
Depreciation and amortization 208,930,640 137,985,368
Interest expense 177,304,646 128,490,292
Movement in:
Accrued rent 12,010,268 21,452,132
Accrued pension costs 353,647 1,642,783
Accretion income 2,731,459 4,149,485
Gain on disposal of PPE 1,734,824 238,591
Loss (gain) on disposal of AFS 1,436,223 4,056,548
Interest income 1,186,755 3,291,346
Unrealized foreign exchange gain 97,122 194,819
Dividend income 486,897
Unrealized loss on change in fair value of financial assets at FPVL
Income before working capital changes 1,413,596,240 995,697,504
Decrease (increase) in:
Trade and other receivables 165,671,908 167,663,201
Inventories 105,921,355 855,740
Prepaid expenses and other current assets 48,128,437 3,758,892
Increase (decrease) in accounts payable and other current liabilities 140,713,580 51,211,514
Net cash generated from operations 1,234,588,120 1,109,246,039
Income taxes paid 263,399,287 178,442,725
Interest received 1,186,755 3,291,346
Net cash provided by operating activities 972,375,588 934,094,660
 SHAKEY'S PIZZA ASIA VENTURES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
December 31
2017 2016
CASH FLOW FROM INVESTING ACTIVITIES
Acquisition of:
Property and equipment 768,164,192 417,637,547
Subsidiaries - net of cash acquired - 6,010,636,947
AFS investments - 1,124,639,257
Financial assets at FVPL - -
Disposal of AFS investments 1,126,609,944 681,365,595
Sale of financial assets at FVPL - 36,084,300
Increase (decrease) in dealers’ deposits and other noncurrent
liabilities 21,362,038 25,623,290
Increase in deferred input value added tax 55,408,492 8,082,285
Increase in rental and other deposits 23,394,756 5,572,608
Proceeds from disposals of property and equipment 21,588,901 5,264,498
Dividends received - 486,897
Collection of intercompany loans - -
Net cash provided by (used in) investing activities 322,593,443 6,868,990,644

CASH FLOW FROM FINANCING ACTIVITIES

Payments of:
Dividends 153,132,105 1101916843.00
Loan 1,050,000,000 -
Interest 175,813,487 114984533.00
Proceeds from:
Loan - 4,975,000,000
Issuance of capital stock - 2,116,261,800
Net cash provided by (used in) financing activities 1,378,945,592 5,874,360,424

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 439,251 194,819
NET DECREASE IN CASH AND CASH EQUIVALENTS 83,976,561 60,535,560
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 328,531,651 388,872,392
CASH AND CASH EQUIVALENTS AT END OF YEAR 244,994,341 328,531,651
 MAX'S GROUP, INC.
Consolidated Statements of Financial Position
(amounts in thousands)

December 31
2017 2016
ASSETS

Current Assets
Cash and cash equivalent 668,983 752,200
Trade and other receivables 1,063,419 955,987
Inventories 589,045 486,702
Prepayments and other current assets 355,997 351,311
Total Current Assets 2,677,444 2,546,200

Noncurrent Assets
Property and Equipment 3,133,531 2,688,832
Intangible Asstes 4,988,699 5,025,849
Investment Properties 535,734 535,921
Net Retirement Plan Assets 310,284 439,771
Net Deferred Income Tax Assets 304,501 147,370
Security Deposits on Lease Contracts 469,176 421,954
Other Noncurrent Assets 337,620 341,055
Total Noncurrent Assets 10,079,545 9,600,752
TOTAL ASSETS 12,756,989 12,146,952
LIABILITIES AND EQUITY

Current Liabilities
Trade and other Payables 1,964,026 1,977,081
Loans Payable 2,515,437 2,194,639
Current Portion of Mortgage Payable 0
Income Tax Payable 80,648 78,067
Total Current Liabilities 4,560,111 4,249,787

Noncurrent Liabilities
Long-term Debt 1,583,688 1,695,150
Mortgage Payable 0
Net Retirement Liabilities 168,236 204,506
Accrued Rent Payble 74,742 49,696
Net Deferred Income Tax Liabilities 986,134 1,003,043
Other Noncurrent Liabilities 3,115 7,041
Total Noncurrent Liabilities 2,815,915 2,959,436
Total Liabilities 7,376,026 7,209,223

Equity
Capital Stock 1,087,082 1,087,082
Additional Paid - in Capital 5,353,289 5,353,289
Retained Earnings 1,655,492 1,131,932
Other Comprehensive Loss 42,979 15,658
8,052,884 7,556,645
Shares Held By Subsidiaries 2,610,013 2,610,013
Non - controlling Interest 61,908 8,903
Total Equity 5,380,963 4,937,729
TOTAL LIABILITIES AND EQUITY 12,756,989 12,146,952
 MAX'S GROUP, INC.
Consolidated Statements of Income
(amounts in thousands)

December 31
2017 2016
REVENUES
Restaurant Sales 10,462,961 9,415,104
Commissary Sales 1,422,768 1,257,053
Franchise, Royalty and Continuing License Fee 776,194 766,724
12,661,923 11,438,881
COST OF SALES 9,386,162 8,255,704
GROSS PROFIT 3,275,761 3,183,177
GENERAL AND ADMINISTRATIVE EXPENSES 2,171,264 1,822,830
SALES AND MARKETING EXPENSES 390,615 408,600
FINANCE COSTS 116,355 116,775
OTHER INCOME - net 115,581 77,961
INCOME BEFORE INCOME TAX 713,108 912,933
PROVISION FOR (BENEFIT FROM) INCOME TAX
Current 232,501 307,226
Deferred 146,083 43,969
86,418 351,195
NET INCOME 626,690 561,738
 MAX'S GROUP, INC.
Consolidated Statements of Cash Flow
(amounts in thousands)

December 31
2017 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Income before income tax 713,108 912,933
Adjustments for:
Depreciation and amortization 410,440 458,850
Finance Costs 116,355 116,775
Gain on disposal of property and equipment 4,958
Gain on disposal of subsidiaries 2,873
Interest income 1,101 4,069
Impairment of trademark and goodwill - Le Coeur 34,250
Fair value adjustment on acquisition of a subsidiary
Operating income before working capital changes 1,230,971 1,518,739
Decrease (Increase) in:
Trade and other receivable 108,110 253,897
Inventories 102,798 1,978
Prepayments and other current assets 5,735 6,054
Net retirement plan assets 74,206 39,151
Increase (Decrease) in:
Trade and other payable 2,489 126,986
Net retirement liabilities 36,111 63,837
Accrued rent payable 25,046 15,712
Net cash generated from operations 1,074,980 1,182,330
Income Taxes Paid 228,936 248,645
Interests Paid 116,355 116,775
Interests Received 1,101 4,069
Net Cash Provided by Operating Activities 730,790 820,979
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of:
Property and Equipment 822,275 800,579
Additional shares in sudsidiaries 47,164
Intangible Assets 15,614 95,724
Investment Properties 101
Subsidiaries, net of cash acquired
Proceeds from disposal of property and equipment 24,693 407
Increase in:
Security deposits on lease contracts 47,222 47,420
Other noncurrent assets 3,541 23,445
Net Cash Used by Investing Activities 904,041 966,862

CASH FLOWS FROM FINANCING ACTIVITIES

Net proceeds from (payment of):
Loans Payable 320,798 531,293
Long - term Debt 111,462 350,829
Mortgage Payable 4,165
Cash Dividends Paid 101,426 90,068
Returns to non - controlling interests 7,546 6,810
Increase (decrease) in:
Other noncurrent Liabilites 3,926 741
Due to Related Parties
Net Cash Provided by Financing Activities 96,438 80,162

EFFECT OF DECONSOLIDATION 6,404

NET DECREASE IN CASH AND CASH EQUIVALENTS 83,217 65,721

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 752,200 817,921
CASH AND CASH EQUIVALENT AT THE END OF THE YEAR 668,983 752,200
 FINANCIAL
RATIO ANALYSIS
 Short - term Liquidity and Solvency Ratios
2017 2016 Max’s

Current Ratio 1.13 1.08 0.59

Quick Ratio 0.75 0.95 0.38

Working Capital 142,417,266 167,010,428 1,882,667

Working Capital to Total Asset 0.02 0.02 0.15

Cash flow Liquidity Ratio 1.09 0.64 0.31

1.20

 Current ratio shows that it increases from 1.08

1.00 during 2016 to 1.13 on 2017 that may indicate a good
result. It implies that Shakey’s can more easily make
0.80
current debt payment during the current year. As
for the competitor, Shakey’s shows a higher current
ratio which indicates the higher ability to pay off its
0.60
short – term liabilities without having to sell off long
– term, revenue generating assets.
0.40

0.20

0.00 Pano mo
CURRENT RATIO
nasabi?
2017 2016 Competitor
1.00

0.90
 Quick Ratio shows that it decreases
from 0.95 of 2016 to 0.75 on 2017 which
0.80
implies a bad result. It indicates that
0.70 Shakey’s is more able to pay its current
0.60
liabilities, by having assets that are
readily convertible into cash, last year
0.50
than it is for the current year. As for the
0.40 competitor, Shakey’s has a higher quick
0.30
ratio which shows its capability to pay
its current obligations.
0.20

0.10
Hindi sa lahat ng
pagkakataon mabuti
0.00
QUICK RATIO ang may reserba
2017 2016 Competitor
  During the year, SPAVI, Inc. maintained its positive
COMPETITOR working capital. However, the working capital decreases
from P167, 010, 428 of 2016 to p142, 417, 266 of 2017. This
may indicate that SPAVI, Inc. is struggling to maintain or
grow sales, is paying bills too quickly, or is collecting
receivables too slowly. As for the competitor, SPAVI, Inc.
2016 result is better, since the competitor’s result is negative
and may indicate that they are struggling on paying off
their short – term liabilities immediately.

2017

Pano mo
50,000,000 0 50,000,000 100,000,000 150,000,000 200,000,000
nasabi?
Working Capital
  The working capital to total assets
shows an equal ratio for the past two
years, which may indicate Shakey’s
ability to match it account payable
obligation on time. As for the
competitor, Shakey’s shows a much
WORKING CAPITAL TO TOTAL ASSET
higher result. It could be assumed that
Shakey’s realizes revenue from sales
much quicker than it makes payments
for its current obligation.

Pano mo
0.16 0.14 0.12 0.10 0.08 0.06 0.04 0.02 0.00 0.02
nasabi?
Competitor 2016 2017
1.20

 Cash flow liquidity ratio shows that

1.00 it increases from 0.64 of 2016 to 1.09
of 2017. This may indicate that
0.80 Shakey’s can easily cover its short –
term debt with its cash and other
0.60 liquid assets. As for the competitor,
Shakey’s results shows a higher ratio
0.40 that indicates how well it can handle
its short – term debt.
0.20

0.00 Pano mo
CASH FLOW LIQUIDITY RATIO
nasabi?
2017 2016 Competitor
 Asset Liquidity and Management Efficiency

Accounts Receivable
13.91 12.34 12.54
Turnover
Average Collection Period 25.89 29.19 28.71
Inventory Turnover 15.97 29.72 17.45
Average Conversion Period 22.55 12.11 20.63
Working Capital Turnover 45.47 26.89 7.06
Current Asset Turnover 3.49 3.11 4.57
Operating Cycle 48.44 41.30 49.34
Free Cash Flow 802,914,250 8,905,002,147 1,736,257,000
Investment/Asset Turnover 0.76 0.99 1.02
Fixed Asset Turnover 5.52 8.89 4.35
Capital Intensity Ratio 1.35 1.64 1.01
 Accounts receivable turnover shows
that it increase from 12.34 of 2016
to 13.91 of 2017, which implies a
14.00

more favorable result. Higher ratios

mean that Shakey’s are collecting 13.50

their receivables more frequently

throughout the year. As to the 13.00

competitor, Shakey’s has a higher

accounts receivable turnover for the 12.50
2017, that indicates that Shakey’s
credit sales are more likely to be
collected than Max’s.
12.00

Pano mo
11.50
nasabi? Accounts Receivable Turnover

2017 2016 Competitor

 Average Collection Period shows that
during 2017, Shakey’s collected its
accounts in 26 days on average, an 29.50

improvement over the 29 –day collection 29.00

period in 2016. As to the competitor, 28.50
Max’s average collection period is 29
28.00
days. In general, a lower average
collection period is more favorable than a 27.50

higher average collection period. A low 27.00

average collection period of Shakey’s 26.50

during 2017, indicates that Shakey’s is 26.00

collecting payments faster, as compared 25.50
to Max’s that Walang
is not so effective in
25.00
collecting outstanding
bayaadreceivables
24.50
bayad
kaibigan 24.00
Average Collection Period
ko yun!
2017 2016 Competitor
 The inventory turnover of SPAVI,
Inc. decreases from 29.72 of 2016 to
15.97 of 2017. This shows the 30.00

company does not overspend by

buying too much inventory and
25.00

wastes resources by storing non- 20.00

saleable inventory. It also shows
that the company can effectively sell 15.00
the inventory it buys. As for the
competitor, the results shows that 10.00

Max’s is efficient on controlling their

inventories than SPAVI, Inc. 5.00

Pano mo
0.00
nasabi? Inventory Turnover

2017 2016 Competitor

 The average conversion period of
SPAVI, Inc. increases from 12.11 of
2016 to 22.55 of 2017 which may not 25.00

be a good sign. This indicates that

there might be an overstocking and 20.00
obsolesced of the products. This
could also means that if an inventory
15.00
takes long time to end up into sales,
it may affect the cash conversion
cycle. As compared to the competitor, 10.00

Max’s conversion period is lower than

the SPAVI, Inc. which shows that 5.00
Max’s has less risklahat
Hindi of overstocking
ng
Inc.
than SPAVInagtagal naging 0.00
Average Conversion Period

masaya! 2017 2016 Competitor

 SPAVI, Inc. maintained its working
capital turnover of 0.02 during the
two year period, and this implies
that SPAVI, Inc. is not efficient
enough in utilizing its working
capital. However, as for the
competitor, SPAVI, Inc. is more
efficient in utilizing working capital
since the competitor gave a result
of (0.15), which may indicates that
the competitor is investing too
many accounts receivable and
inventory to support its sales.
Pano mo
nasabi? 10.00 0.00 10.00 20.00 30.00 40.00 50.00

Competitor 2016 2017

 The current asset turnover shows that it
increases from 3.11of 2016 to 3.49 of
2017. The increasing trend of this 5.00
ratio is a good sign because this 4.50
means that the company is working
4.00
on the consistent improvement of
its policies in inventory, accounts 3.50

receivable, cash and other current 3.00

assets management. As to its 2.50

competitor, the Max’s company is 2.00

generating more revenue for every 1.50

use of the current asset than the 1.00

Shakey’s company. 0.50
Pano mo
0.00
nasabi? Current Asset Turnover

2017 2016 Competitor

 The operating cycle shows that it
increases from 41.30 of 2016 to
48.44 of 2017 where it indicates that 50.00

the Shakey’s company may not be

successful in lowering the days it
48.00

takes to convert products and 46.00

services to cash and even the

effectiveness of its marketing. As to 44.00

its competitor, Shakey’s company is 42.00

more able to convert products and
services into cash in shorter time 40.00

than Max’s company.

38.00

Pano mo
36.00
nasabi? Operating Cycle

2017 2016 Competitor

 The free cash flow shows that it
decreases from 8,905,002,147 from
2016 to 802,914,250 of 2017. The 9,000,000,000

more the free cash flow rises, the 8,000,000,000

more the entity the can meet the
average daily cash requirements. As
7,000,000,000

to its competitor, the Max’s company 6,000,000,000

may seem efficiently using its free 5,000,000,000

cash to generate more revenue than
4,000,000,000
Shakey’s company.
3,000,000,000

2,000,000,000

1,000,000,000
Pano mo
0
nasabi? Free Cash Flow

2017 2016 Competitor

 The asset turnover ratio shows that
it decreases from .99 of 2016 to .76
of 2017 which is a normal effect 1.20

when the Shakey’s company make a

significant purchases. So we can 1.00

assume that the value of the

Shakey’s company would be higher 0.80

than the Max’s company.

0.60

0.40

0.20

Pano mo
0.00
nasabi? Investment/Asset Turnover

2017 2016 Competitor

 The fixed asset turnover show that it
decrease from 8.89 of 2016 to 5.52
of 2017 which is an indicative that 9.00

the Shakey’s company may not 8.00

efficiently managing its fixed-asset
7.00
investment to utilize a greater
revenue to every fixed asset usage. 6.00

As to its competitor, the Shakey’s 5.00

company is more cost effective in 4.00

utilizing its usage than to its
3.00
competitor.
2.00

1.00
Pano mo
0.00
nasabi? Fixed Asset Turnover

2017 2016 Competitor

 The capital intensity ratio shows
that it decrease from 1.64 of 2016
to 1.34 of 2017, the result is 1.80 1.64

because the Shakey’s company have 1.60

more usage of assets. As to its 1.40

1.35

competitor, the Shakey’s company

is less capital intensive in terms of
1.20
1.01

labor than the Max’s company. 1.00

0.80

0.60

0.40

0.20
Pano mo
0.00
nasabi? Capital Intensity Ratio

2017 2016 Competitor

 Long-term Financial Position or Stability/Leverage
2017 2016 Max’s

Debt Ratio 0.56 0.64 0.58

Equity Ratio 0.44 0.36 0.42
Debt-equity Ratio 1.29 1.79 1.37
Fixed Assets-Long Term Liabilities 0.38 0.25 1.11
Fixed Assets-Total Equity 0.39 0.30 0.58
Fixed Assets-Total Assets 0.17 0.11 0.25
Book Value Per Share 2.60 3.90 8.25
Times Interest Earned 6.77 8.29 7.13
0.66

0.64

 The result of Shakey’s debt ratio shows that

0.62
it decreases from 0.64 to 0.56 and it may
indicate a good result, since a lower debt
ratio implies a more stable business. As for
0.60
the competitor, Shakey’s shows a lower ratio
which means it is more stable with the
0.58 potential of longevity because of a
possibility of lower overall debt.
0.56

0.54

0.52
Pano mo
Debt Ratio nasabi?
2017 2016 Competitor
0.50

0.45

0.40  Equity ratio shows that it increases from

0.36 to 0.44 on 2017. It implies that
0.35
Shakey’s has minimized the use of debt to
0.30 fund its assets requirement. As for the
competitor, shakey’s equity ratio is higher
0.25 than Max’s, which may indicate that
shakey’s is more sustainable and less risky to
0.20
lend future loans.
0.15

0.10

0.05

0.00
Pano mo
Equity Ratio nasabi?
2017 2016 Competitor
2.00

1.79
1.80

1.60  Debt-Equity Ratio of Shakey’s decreases

1.37
from 1.79 to 1.29 in the year 2017 which
1.40
1.29 indicates that there is a decrease in use of
1.20 debt financing and an increase in equity, As
for the competitor, a ratio of 1.37, as
1.00 compared is at its average, not too high, not
too low, having a minimal decrease in debt.
0.80

0.60

0.40

0.20

0.00
Pano mo
Debt-equity Ratio nasabi?
2017 2016 competitor
1.20

1.00
 An increase of .13 indicates that the fixed
asset for 2017 increases its capability to
0.80 finance its long term Liabilities but is still
unable to cover all of its long term debts. As
for the competitor, Max’s having a 1.11 ratio
0.60 indicating that it is able to finance all of its
long term debts using only its fixed asset.
0.40

0.20

0.00
Pano mo
Fixed Assets-Long Term Liabilities
nasabi?
2017 2016 Competitor
0.30

0.25
 As per result, it is concluded that there is an
increase in investing fixed asset for the year
0.20 2017 having a 6% increase, from 11% to
17%.As for the competitor, a quarter of the
total assets was fixed asset indicating that
0.15 Max’s has a greater investment than
Shakey’s in terms of fixed asset.
0.10

0.05

0.00
Pano mo
Fixed Assets-Total Assets
nasabi?
2017 2016 Competitor
9.00
8.25
8.00

7.00  Evaluating the results you could calculate a

decrease in book value from 2.19 to 2.60.
6.00 This was caused by an increase in its total
equity from 3,359,077,125 to 3,974,241,106.
5.00 As for the competitor, it has a greater return
in case of liquidation than Shakey’s having
4.00 a book value per share of 8.25.
3.00
2.60
2.19
2.00

1.00

0.00 Pano mo
Book Value Per Share
nasabi?
2017 2016 Competitor
9.00

8.00

7.00  From the data extracted 2016’s TIE was

greater than 2017’s TIE, meaning Shakey’s
6.00 was more profitable in 2016 than 2017. As
for the competitor, we can conclude that it
5.00 was operating just fine since it earns its
interest better than Shakey’s in 2017.
4.00

3.00

2.00

1.00

0.00 Pano mo
Times Interest Earned
nasabi?
2017 2016 Competitor
 Profitability and Return to Investors
2017 2016 Max’s

Gross Profit Margin 0.31 0.31 0.31

Operating Profit Margin 0.17 0.14 0.07
Net Profit Margin 0.11 0.13 0.06
Cash Flow Margin 0.14 0.16 0.07
Rate of Return on Asset 0.08 0.13 0.05
Rate of Return on Equity 0.21 0.31 0.12
Earnings per Share 0.50 0.88 0.80
Price-Earnings Ratio 27.04 15.28 19.78
Dividend Pay - out 0.20 0.20 0.16
Dividend Yield 0.01 0.01 0.01
Dividends per Share 0.10 0.18 0.13
Rate of Return on Average Current Assets 0.45 0.45 0.24
Rate of Return per turnover of Current Assets 0.13 0.14 0.05
 Gross Profit Margin does not change 0.35

for the past two years, and as

compared to Max’s, they have the 0.30

same ratio. The gross profit margin

0.25
of Shakey’s for both 2017 and 2016
have been stable which is considered
0.20
a positive sign, it indicates how
Shakey’s manage to control the
0.15
profitability of its production
process.
0.10

0.05

Pano mo
nasabi? 0.00
Gross Profit Margin
2017 2016 Competitor
 Operating Profit Margin shows that 0.18

it increase from 0.14 of 2016 to 0.17 0.16

of 2017, which implies a more
favorable result because it shows how 0.14

Shakey’s is efficient in controlling 0.12

the costs and operating
expenses associated with 0.10

business operations. As to the 0.08

competitor Max’s has a much lower
operating profit margin, although 0.06

their sales has increased.

0.04

0.02
Pano mo
nasabi? 0.00
Operating Profit Margin
2017 2016 Competitor
 Net profit margin of
0.14

Shakey’s have fallen 0.12

from 0.13 of 2016 to 0.10

0.11 of 2017, but as

0.08
compared to its’s
competitor, Shakey’s is 0.06

more profitable than 0.04

Max’s..
0.02

Pano mo
nasabi? 0.00
Net Profit Margin
2017 2016 Competitor
 Cash Flow Margin of Shakey’s have 0.18

fallen from 0.16 of 2016 to 0.14 of 0.16

2017. But as compared to its’s
competitor, Shakey’s is much higher 0.14

than Max’s. This could be an 0.12

indication that Shakey’s is better in
converting earnings from sales into 0.10

actual cash flow, than Max’s. 0.08

0.06

0.04

0.02
Pano mo
nasabi? 0.00
Cash Flow Margin
2017 2016 Competitor
 Shakey’s performance decrease from 0.13 of 0.14

2016 to 0.08 of 2017. The lower rate in 2017,

does not mean a bad sign, maybe because 0.12
Shakey’s total assets during 2017 is lower
than 2016, and as you can see in the balance
0.10
sheet during 2017, Shakey’s acquired more
noncurrent asset than 2016. The reason
could be also due to change in debt and 0.08

equity during 2017, although there is an

increase in equity, the debt is lower than 0.06
2016 and this have an effect in the total
assets since debt increases company assets
0.04
because it generates a large lump sum of
cash or continuous cash inflow. As compared
to its competitor, Shakey’s is more efficient 0.02

than Max’s in using its assets

Pano mo to generate
earnings.
nasabi? 0.00
Rate of Return on Asset
2017 2016 Competitor
 Shakey’s rate of retun on equity decrease 0.35

from 0.31 of 2016 to 0.21 of 2017. Although

there is a decrease during 2017, it does not 0.30
mean that Shakey’s is not a healthy
company anymore, this result could be due
0.25
to decrease in debt during 2017, as compared
to 2016, since debt have a signifant effect in
computing R0E, a high level of debt can 0.20

artificially boost ROE, after all, the more

debt a company has, the less shareholders' 0.15
equity it has (as a percentage of total
assets), and the higher its ROE is. As
0.10
compared to Max’s, Shakey’s has a greater
ROE, which signifies how good the Shakey’s
in generating returns on the investment it 0.05

received from its shareholders.

Pano mo
nasabi? 0.00
Rate of Return on Equity
2017 2016 Competitor
 Shakey’s earnings per share fall from 0.88 of 1.00

2016 to 0.50 of 2017,this could be due to an 0.90

increase in the number of shares
outstanding during 2017 than 2016, an 0.80
increase in the total number of shares means
that each existing share represents a smaller 0.70

percentage of ownership. As the company's 0.60

earnings are divided by the new, larger
number of shares to determine the 0.50
company's earnings per share (EPS), the
0.40
company's EPS figure will drop.
Fortunately, it is still a good sign because 0.30
even though Shakey’s issue a significant
amount of additional stock during 2017, the 0.20
market value per share of Shakey’s is
0.10
increasing from 11.26 of 2016 to 13.46 of
Pano mo
2017. As to the competitor, Max’s (0.80) is 0.00
greater than Shakey’snasabi?
(0.50), this shows that Earnings per Share

Max’s is more profitable on a shareholder 2017 2016 Competitor

 The price/earnings ratio shows that there is 30.00

an increase from 15.28 0f 2016 to 27.04 of

2017. This is because of the increase of the
25.00
current market value of Shakey’s company
which is through the reinvestment of the
entity of to the fixed assets or the payment 20.00
of the entity of its debt. And also the entity
maintained a good performance for the year
so that the MV increased positively. As to its 15.00
competitor, the Shakey’s company is more
reliable investment than the Max’s company.
10.00

5.00

Pano mo
nasabi? 0.00
Price-Earnings Ratio
2017 2016 Competitor
 The dividend payout ratio shows that 0.25

it remained constant because adopt a

new policy for the dividend
0.20
declaration and there is a decrease in
the EPS of the Shakey’s company
which the company assessed 0.15
carefully so that the investor would
not pull out. It is because also on the
reinvestment of the entity to which 0.10

generate a long-term benefit. As to

its competitor, we can assume that
the Shakey’ investor can generate 0.05

more return in the future than the

Max’s company. Pano mo
nasabi? 0.00
Dividend Payout
2017 2016 Competitor
 The dividend yield remain constant even 0.01

though in there is a changes in the dividend

policy because the Shakey’s market value
0.01
per share increase. The decrease in the DPS
has been balance by the increase of MV per
share. We can assume that the market value 0.01
per share become higher because of the
reinvestment of the entity which increase
the value share that can a future benefits in 0.01
the entity. As compared to its competitor, we
can assume that the entity has more return
on investment in the future than the Max’s 0.00

company.
0.00

Pano mo
nasabi? 0.00
Dividend Yield
2017 2016 Competitor
 The dividend per share shows that there is a 0.20

decrease in dividend declared of the 0.18

Shakey’s company from .18 of 2016 to .10 of
2017. The lower the dividend per share does 0.16
not mean that the entity have a poor
performance it could be that the entity 0.14

adopt for the new dividend policy in order to 0.12

pay out debt which we see that the debt of
the entity for the current year has been 0.10
reduced compared to the previous year or
the profit is been used in reinvesting in the 0.08

new fixed asset. As compared to its

0.06
competitor, Shakey’s is more profitable in
the eye of the investor even though the 0.04
Max’s declared a larger dividend.
0.02
Pano mo
nasabi? 0.00
Dividends per Share
2017 2016 Competitor
 The rate of return on average 0.50

current asset shows a constant ratio 0.45

which seemingly the Shakey’s

0.40
company maintain a good
performance in assessing it current 0.35

asset for increasing its net income 0.30

that we see in the income statement
0.25
even though the total current asset
decrease. As to its competitor, the 0.20

Shakey’s company is more 0.15

productive than the Max’s company.
0.10

0.05
Pano mo
nasabi? 0.00
Rate of Return on Average Current Assets
2017 2016 Competitor
 The rate of return per turnover of 0.16

current asset shows that there is 0.14

decrease from .14 of 2016 to .13 of
2017. This is because there is increase 0.12

in current asset turnover which

indicate a good sign. The Shakey’ 0.10

company is working in the consistent

0.08
improvement of the policies in
managing its financial resources. As 0.06
to its competitor, the Shakey’s
company more efficient in managing 0.04

it resources than the Max’s

Company. 0.02
Pano mo
nasabi? 0.00
Rate of Return per turnover of Current Assets
2017 2016 Competitor
Liquidity Ratio INDUSTRY SHAKEY’S MAX’S
Current Ratio 1.24 1.13 0.59
Quick Ratio 1.00 0.75 0.38
Activity Ratio
Trade Receivable Turnover 20.45 13.91 12.54
Inventory Turnover 14.55 15.97 17.45
Total Asset Turnover 1.63 0.76 1.02
Profitability Ratio
Gross Profit Margin 0.44 0.31 0.31
Operating Profit Margin 0.15 0.17 0.07
Net Profit Margin 0.08 0.11 0.06
Cash Flow Margin 0.01 0.14 0.07
Rate of return on Asset 0.02 0.08 0.05
Rate of return on Equity 0.12 0.21 0.12
Earnings per Share 4.18 0.50 0.80
Price/Earnings Ratio 47.66 27.04 19.78
Dividend Yield 0.07 0.01 0.01
Coverage Ratio
Debt to Equity 0.12 1.29 1.37
3.00

2.00

1.00
1.24 1.13
0.59
0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00
1.00
0.75
0.38
0.00
INDUSTRY SHAKEY'S MAX'S
25

20

15

20.45
10
13.91 12.54
5

INDUSTRY SHAKEY'S MAX'S

17.5

17

16.5

16

15.5
17.45
15

14.5 15.97

14 14.55
13.5

13

INDUSTRY SHAKEY'S MAX'S

3.00

2.00

1.00

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00 1.61
1.02
0.76

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00

0.44 0.31 0.31

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00
0.15 0.17 0.07

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00
0.08 0.11 0.06

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00
0.01 0.14 0.07

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00
0.02 0.08 0.05

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00

1.00 0.21
0.12 0.12

0.00
INDUSTRY SHAKEY'S MAX'S
3.00

2.00
4.18

1.00

0.8
0.50
0.00
INDUSTRY SHAKEY'S MAX'S
50
45
40
35
30
25 47.66
20
15 27.04
10 19.78

5
0

INDUSTRY SHAKEY'S MAX'S

3.00

2.00

1.00
0.07 0.01 0.01

0.00
INDUSTRY SHAKEY'S MAX'S
 CONCLUSION and
RECOMMENDATION