REQUIREMENT: Choose any TWO companies listed in the construction sector of the Main Market of Bursa Malaysia. Using...

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Finance

REQUIREMENT:
Choose any TWO companies listed in the construction sector ofthe Main Market of Bursa Malaysia.
Using the relevant profitability ratios (supported withdetailed workings), analyse and explain the trends in thecompaniesâ€™ ratios over the past five years (2013 - 2017).
Compare the companiesâ€™ financial performance based on thecalculated ratios.
Outline the companiesâ€™ strengths and weaknesses as revealed byyour analysis.
What are some potential problems and limitations of thefinancial ratio analysis when evaluating and comparing the twocompanies?
What are some qualitative factors that should be consideredwhen evaluating the companies?
[Total: 60 Marks]

Answer & Explanation Solved by verified expert

3.9 Ratings (552 Votes)

Companies selected areGamuda Berhad Gamuda WCT Holdings Berhad WCTa The main profitability ratios are all below numbers are inmillions of RemnibiGamuda Berhad WCT Holdings Berhad1 Operating Profit Margin 2013 1318 18312014 1822 11672015 1802 13852016 1872 9412017 1448 16422 Net Profit Margin 2013 1416 11902014 1507 7402015 1432 12532016 1501 3522017 1056 8133 Return on Assets 2013 601 3612014 693 2092015 576 3222016 455 0972017 402 2004 Return on Equity 2013 1077 8942014 1134 5512015 1019 8012016 867 2462017 767 4945 Return on Capital Employed 2013 751 4582014 894 2682015 742 3952016 669 1232017 572 263Formulas for the above ratios are given as below1 Operating Profit Ratio 2 Net Profit Ratio 3 Return on Assets 4 Return on Equity 5 Return on Capital Employed Gamuda has been pretty consistent in its profitability ratiosfrom 20132015 then witnessed a slight dip in almost all ratios See Answer

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