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1、CHINT ELECTRICS,2011 FINANCIAL REPORTING AND ANALYSIS,1,Team Members：Liu ZhaoyeCommon-SizeWang YuyaoDebt-PayingXue JianchaoProfitability/OperationShen KangliangInvestment/OperationJiang RuiCompetitor/IntroductionLI xinCompetitor/Introduction,2,CHINT ELECTRICS Is Chinas largest production of low volt
2、age electric appliance manufacturing enterprise,the specialty is engaged in distribution appliances,control electric appliances,terminal apparatus,and power electronic and electric power supply low-voltage products development,production and sales.Chint is recognized for a famous Chinese trademark,c
3、hint brand universal type circuit breaker,plastic shell type breaker series product has been awarded China famous brand product title.The company in 2004 won the Chinese quality management of the highest award,the national quality management award,3,Company profile Stock name:CHINT ELECTRICS Stock c
4、ode:601877,Is Chinas leading company in the field of low voltage electrical appliances Adhere to the independent innovation,research and development a series of with independent intellectual property rights,reach the international advanced level of low voltage electric products The companys brand to
5、 borrow Jacques realize from low voltage electrical supplier to solution provider change,so as to get higher gross margin and wide development space,the realization enterprise of in-depth development.,4,The review of latest earnings,The sales were 82,880,000,000 in 2011,increased to 30.75%of the 201
6、0 level in 2011.Realized earnings before income tax provision and interests were 10,190,000,000.An increase of 24.70%.The net profit were 8,430,000,000.An increase of 31.82%.Realized 797 million net profit after buckle,increased by 31.16%.The diluted EPS is 0.91.Due to the significantly decrease in
7、main raw material cost price,made the gross earnings ratio increase to 28.71%in the fourth quarter,increased the gross earnings level throughout the year obviously 24.03%,5,Common-Size Analysis,6,Balance Sheet Vertical Common-size,7,8,Balance Sheet Vertical Common-size,In 2011,the non-current liabil
8、ities item of company is the proportion of the 2010s increase obviously,mainly because the company in 2011 to raise funds for company executed bonds issue 1.5 billion Yuan.From the current liabilities to see,the companys short term loans has always been the proportion is very low，In 2010 the company
9、 short-term borrowing all paid off,in 2011 the company only had an increase of 1.1 million Yuan short-term borrowing，Should say this benefits from the company is very sufficient liquidity。The proportion of accounts payable is low,on the whole,the companys short-term debt service pressure is very low
10、.,9,Balance Sheet Vertical Common-size Analysis,Balance Sheet Crosswise Common-size,10,11,Balance Sheet Crosswise Common-size,Company sales growth not only brought ample liquidity,more subsequent receivables.Accounts receivable compared to above increase is not a lot,but notes receivable is nearly s
11、even times to 2009.The annual report to make a explained,in order to reduce the risk of bad loans,the company adjust credit policy,increase the settlement scale of bank acceptance.,12,Balance Sheet Crosswise Common-size Analysis,A long-term equity investment of 2011 years is 2009 7 times,mainly due
12、to the value of 161.59 million Yuan this company to purchase the“ZKtechnology 9.18125 million shares,in addition to the company invested 200 million RMB.The project under construction company in 2011 is 2009 years of 24 times,mainly due to current period to raise funds based construction project in
13、caused by increase.The company non-current liabilities in 2011 is 2009 65 times,mainly because of the increase of bonds payable project,that company was to issue 1.5 billion bonds.Capital reserve in 2011 and 2010 were more than 500 times in 2009,mainly because of the company 2010 years was just list
14、ed.,13,Balance Sheet Crosswise Common-size Analysis,Profits and Loss Items Crosswise Common-size,14,15,Profits and Loss Items Vertical Common-size,Profits and Loss Items Common-size Analysis,The company business income in 2011 was 1.7 times than that in 2009,operating income increased year by year,e
15、xplain the company sales scale expands unceasingly.The annual report says the company mainly due to the increasing domestic and foreign market development and promotion of new strength,so domestic auxiliary market demand increase,sales volume growth.The company business cost 2011 is 1.8 times more t
16、han in 2009,operating costs increased year by year,and compared with the business income greater proportion.This is mainly because 2011 product sales growth and raw material prices caused by common effect,but net profit in operating income proportion and not as a substantial increase in the sales in
17、crease,so the pressure of the rising costs was more.,16,The financial cost three years are negative,suggests the company continued interest income were more than interest expenses and financial expenses in 2011 is 2009 of 12 times,annual report also shows that 2011 net interest revenue by two hundre
18、d and twenty percent more than at the beginning,because that does not exist is annual report has the controlling shareholders and their affiliates non-business take fund,then according to illustrate the annual report because the 2011 main source of revenue for the financial risk control increased ca
19、sh reserves,interest income increase.,17,Profits and Loss Items Common-size Analysis,Main Business Common-size,18,Main Business Common-size Analysis,We can see that the power distribution,terminal and control electric appliance is the companys three big blockbuster products.Low voltage electric low
20、end the market the main competitive factors is cost control ability and product prices,and the company with domestic similar enterprise brand advantage compared significantly,bargaining power,stronger,cost control ability outstanding,higher growth performance for many years the industry average more
21、 than 10%of the companys market share increases company experienced industry inside remain relatively high growth.,19,analyses of short-term debt-paying ability,comparisons between some ratios of recent 3 years,21,Analyses of Working Capital,As we can see from the chart，this companys working capital
22、 has been positive and gradually increased recently，because the recent 3 years current assets and liabilities have gradually increased respectively，and the difference between these two have also increased;this difference is the working capital.This increase in the working capital indicates that the
23、companys short-term debt-paying ability is guaranteed，and strengthened recently。,22,Analyses of Current Ratio,As we can see from the chart，this companys current ratio has been positive and gradually increased recently，because the current assents and current liabilities have gradually increased,but t
24、he current assets have increased faster.The increase of current ratio indicates that the company has a growing ability to pay the current liabilities,and the short-term debt-paying ability has strengthened.,23,Analyses of Acid-test Ratio,As we can see from the chart，the companys acid-test ratio has
25、gradually increased recently，because the current assets and inventories have both increased but the current assets have increased much faster,which made the difference between them increase.The increase in the acid-test ratio indicates that the company has a growing ability to immediately realize an
26、d pay short-term liabilities.At the same time,this tendency is consistent with the current ratios tendency,which means that the companys inventories have been stable recent.,24,Analyses of Cash Ratio,As we can see from the chart，the companys year2011s cash ratios is much bigger than year2009s，but th
27、e year 2011s is slightly smaller than the years.Because the cash equivalents grew much faster than the current liabilities,causing their ratio to increase.As to year 2011 and 2010,the cash equivalents and the current liabilities have both increased but their ratios have a little difference.The tende
28、ncy in cash ratio indicates that the companys ability to pay immediately has increased enormously and decreased a bit.,25,Analyses of Net Cash Provided by Operating Activities/Current Liabilities,As we can see from the chart，the companys net cash provided by operating activities/current liabilities
29、has gradually increased,because the net cash provided by operating activities have decreased and the current liabilities have increased,causing their ratio to decrease.This ratios tendency indicates that the company has a gradually decreased ability to pay its short-term debts by using net cash.This
30、 ratio in the recent 3 years has been below 1,so the company cant pay its debt using just net cash provided by operating activities.It must obtain cash in other ways to ensure that its liabilities can be paid in time.,26,analyses of long-term debt-paying ability,comparisons between some ratios of re
31、cent 3 years,28,analyses of debt ratio,As we can see from the chart，the companys 2010 years debt ratio is much smaller than the 2009s,because the total assets of year2010 is much bigger than the year2009.The debt ratio of year2011 is nearly level with the year2009,because although the total assets a
32、nd liabilities have both increased，but as with year2009，the total liabilities are nearly half of the total assets.Theoretically，in the recent 3 years,the company has a growing and then decreasing debt burden.However,these ratios are all below 50%，which can be considered acceptable and means that the
33、 company has a comparatively light debt burden and the creditors interests are highly protected.,29,Analyses of debt/equity ratio and Debt to tangible net worth ratio,As we can see from the chart，these two ratios have both decreased and increased recently.Because compared with the total owners equit
34、y,the total intangible assets and liabilities are much smaller,the reasons for this tendency are almost the same，that is,the year2010s total equity is much bigger than the year2009s。However the year 2011s total equity and liabilities and the year2009s can be nearly considered the same.,30,Analyses o
35、f Times interest earned,As we can see from the chart,the companys times interest earned has fluctuated enormously recently.It increased enormously from year2009 to 2010,and decreased enormously from year2010 to 2011.The reason is that compared with year2009,the year2010s net profit and tax expense h
36、ave both increased,but interest expense has decreased enormously,causing the ratio of the total of these three and interest expense to increase.Besides,compared with the year2010,the year2011s net profit and tax expense have both increased,but interest expense has decreased more enormously,causing t
37、he ratio of the total of these three and interest expense to decrease.As can be known,the fluctuation of interest expense is the main reason for the fluctuation of times interest earned.Although the times interest earned fluctuated much,these figures indicate that the company has a considerable abil
38、ity to pay the interest debt and long-term debt-paying ability.,31,Analyses of Net Cash Provided by Operating Activities/Total Liabilities,As we can see from the chart，this ratio has decreased recently,because the net cash provided by operating activities have decreased and the total liabilities hav
39、e increased,causing the ratio of these two to decrease.This ratios decreasing tendency indicates that the company has a decreasing ability to pay its debts using the net cash provided by operating activities.The figures of the recent 3 years are all below 1,so the company cant pay its debts using ju
40、st the net cash provided by operating activities.,32,The summary of analyses of debt-paying ability,As we can see from the analyses from,the companys ability to pay liabilities has been growing decently,especially between year2009 and 2010.Although it has undergone some fluctuations in some ratios,t
41、hese changes can be considered the changes that dont influence the debt-paying ability much.These trends also conform to the appliances industrial development.Because of such factors as national policy and growing economic development,the home appliance,the company has been developing rapidly.Howeve
42、r,according to some ratios,the company still has something to improve.,33,Operation Capacity Analysis,34,Operational capability index contrast,35,According to analyze the index of operation capability,account receivable turnover went up year by year.It explained that the growth rate of net sales exc
43、eeded growth rate of account receivable.The main reason that rapid growth of sales income lead to increasing account receivable.In order to reduce Bad debt risk of CHNT,CHNT properly adjust credit policy and increase the scale of settlement the bank acceptance.Because of increasing account receivabl
44、e turnover,CHNT received much cash and Loss on bad debts reduced.CHNT has great debit paying ability.,36,inventory turnover ratio also increased year by year.It illustrated that the increasing extend of cost of sale overweight increasing inventory.It also showed that the occupation of the inventory
45、level of CHNT was low and had highly liquidity.Moreover,the more highly liquidity,the more fast the speed of inventory converting to cash and account receivable.CHNTs fixed asset turnover was increasing.It showed the utilization of fixed asset of CHNT had become higher and higher and the management
46、level constantly improved.Meanwhile,it has advantage for improving CHNTs profitability.,37,However,the total asset turnover has decreased year by year.Total asset turnover is an important indicator to examine the operational efficiency of corporate assets,reflecting the transfer speed of all of the
47、assets of the business during the period from input to output.The possible reason lies in the companys long-term equity investments,intangible assets and construction in progress.Owing to a significant increase in long-term equity investments,intangible assets and construction in progress,it leads t
48、o the increase in total assets is greater than the increase in net sales.The actual situation,confirmed the speculation.The company purchase a low voltage electric appliance industry base.This move led to a significant increase in long-term equity investment.Due to newly acquired Wenzhou electrical,
49、net sales growth was slower than the growth of total assets.At the same time,Zhejiang Zhengtai Corporations total asset turnover is still far higher than the industry total asset ratio.It proved that the company operates well.,38,Profitability Analysis,39,Profitability index contrast,40,Compared wit
50、h 2009,we found that the equity return rate changes a lot in 2011.Through the analysis of financial statements,we found the company owners equity increases by 220.12%.Owners equity greatly increased,leading to rights return rate drop dramatically.The reason why the owners equity has a big increase i
