Horizont

al,
Vertical
& Ratio
Analysis
Jollibee Foods Corporation and Security Bank Company
Tel 722-765-3334 Manila, Philippines www.analysisof2companies.edu.ph
Fax n/a [email protected]
 Table of Contents

Contents
To our Dear Financial Analyst___________________________1

Horizontal Analysis____________________________________2

Vertical Analysis___________________________________________3

Ratio Analysis______________________________________4-7

Liquidity Ratio_________________________________________4

Solvency Ratio________________________________________5

Profitability Ratio__________________________________6

Activity Ratio_____________________________________7

Company Information___________________________________8
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Pg. 1 Information

Dear Ma’am,

I regret to tell you that

some of my attitudes
To Our Dear
Financial Analyst
are not well mannered
and it is somehow
annoying and
disrespectful. But
nevertheless, may I
appeal on your deeper
Strategic Highlights
understanding of these This analysis will strengthen the capability and capacity of the
attitudes and I will do
my best to lessen these.
Jollibee Food Corporation in a better performance in the field of food
industry in the Philippines since it will be determined the weaknesses
and strengths of the said company so that they could come up
another strategy to improve weaknesses as well as the strengths.

Financial Highlights
The Jollibee Foods Corporation made use of the different styles in
analysis which are horizontal analysis, vertical analysis and ratio
analysis. These analysis greatly help the company to sustain
informations regarding to the transactions made by the company.

Operating Highlights
Based on the qoute “ A company that compares its statements, is a
company that seeks a room for improvement” implies that the
company must have a copmarability among their statements so that
they could know how far the business had gone.

Looking Ahead
The interpretations of the analysis must be 100% accurate for the
knowledge of everybody.
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Pg. 2 Information

Horizontal Analysis
In this section provides the neccessary evaluation on the Statement
of Comprehensive Income of Jollibee Foods Corporation for the fiscal
year 2016-2017. Hence, there are some informations that are not
provoded in the Jollibbee Foods Corp.’s Comprehensive Income

Jollibee Foods Corporation

ACCOUNT TITLE 2017 2016 inc/dec % inc/dec

Sales P126,229,530 P108,992,341 P17,237,189 15.82%

Inventory,
78,647 18,180 60,467 332.60%
Beginning
Purchases 13,905,845 11,861,440 2,044,405 17.24%
Inventory, Ending 32,565 78,647 -46,082 -58.59%
Cost of Sales 107,658,140 92,815,488 14,842,652 15.99%
Gross Profit 23,918,411 20,995,982 2,922,429 13.92%
Operating
13,905,845 11,861,440 2,044,405 17.24%
Expenses
Income Before
8,339,510 7,730,120 609,390 7.88%
Interest and Taxes
Interest Expense 405,820 267,618 138,202 51.64%
Income Tax
1,666,928 1,676,611 -9,683 -0.58%
Expense
Net Income P6,672,582 P6,053,509 P619,073 10.23%
Statement of Comprehensive Income

Table 1. Horizontal Analysis

The table shows the percentage rate of the income statement

of the corporation which indicates that the net income of 2016 has
increased in 2017 amounting to 6 672 582 philippine peso with a
percentage of 10.23%.
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Pg. 3 Information

Vertical Analysis
This portion presents the items as percentages of a given base
amount of 100% on its net sales. Moreover, this analysis is reffered to
that of the horizontal analysis for some informtions are not
presented.

Jollibee Foods Corporation

AccountsTitle 2017 2016
Sales P126,229,530 100% P108,992,341 100%
Inventory,
P78,647 0.06% P18,180 0.02%
Beginning
Purchases P13,905,845 11.02% P11,861,440 10.88%
Inventory,
P32,565 0.03% P78,647 0.07%
Ending
Cost of Sales P107,658,140 85.29% P92,815,488 85.16%
Gross Profit P23,918,411 18.95% P20,995,982 19.26%
Operating
P13,905,845 11.02% P11,861,440 10.88%
Expenses
Income Before
Interest and P8,339,510 6.61% P7,730,120 7.09%
Taxes
Interest
P405,820 0.32% P267,618 0.25%
Expense
Income Tax
P1,666,928 1.32% P1,676,611 1.52%
Expense
Net Income P6,672,582 5.29% P6,053,509 5.55%
Statement of Comprehensive Income

Table 2. Vertical Analysis

The table shows the percentages of items with a base amount

on the net sales of the corporation in the two fiscal years of 2016 and
2017. It was analyzed that the cost of sales has the highest amount
in the operation.
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Pg. 4 Information

Ratio Analysis (Liquidity Ratio)

This portion presents how Jollibee Foods Corporation is liquid enough in
covering up such liabilities of the company.

Working Capital
Total Assets P89,783,895
- -
Total Liabilities P47,201,916
=P42,581,979
The table shows that the company has a positive working capital
which is something great to a company. Working capital wise, JFC is in a
better liquidity ratio.

Current Ratio
Current Assets P37,141,016
/ /
Current Liabilities P26,694,605
=1.3913 (rounded)
The table presents that the JHC has a whole number current ratio
signifies that the company is in a good position to cover up the existing
liabilities and the currently maturing obligations of the company.

Quick Ratio
Cash+ Receivables+ Securities P21,107,474 + P3,941,073
/ /
Current Liabilities P26,694,605
=0.9383 (rounded)
The table notes that the company has a positive quick asset ratio. It
means that the compnay is still capable enough in paying the currently
A financial analyst
must have the skills maturing obligations of the company trough the quick assets.
in determining the
different analysis
needed for the
evaluation of the Cash Ratio
statements of the
company.
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Pg. 5 Information
Cash+ Securities P21,107,474
/ /
Current Liabilities P26,694,605

=0.7907 (rounded)
The table shows that the company has a 0.7907 cash ratio. For
these kind of companies, it is considerable that it is still liqui
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Pg. 6 Information

Ratio Analysis (Solvency

Ratio)
This portion presents how Jollibee Foods Corporation is capable enough to
pay such long term obligations as they fall due.

Debt Ratio
Total Liabilities P47,201,916
/ /
Total Assets P89,783,895
=0.5257/ 52.57% (rounded)
The table shows that the company is solvent enough in paying
the long term obligations.

Equity Ratio
Total Equity P42,581,979
/ /
Total Assets P89,783,895
=0.4743/ 47.43% (rounded)
The table connotes that the company’s owner has 47.43%
claims in the company’s asset.

Debt to Equity Ratio

Total Liabilities P47,201,916
/ /
Total Equity P42,581,979
=1.1085/ 110.85% (rounded)
The table presents that the liablities of the JHC is much higher
than its equity.

Time Interest Earned

Earnings Before Interest and P8,339,510
Taxes /
/ P2,152,161
Interest Expense =3.8749 times (rounded)
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Pg. 7 Information
The table indicates that there are 3.87 times the EBIT can
cover the finance cost of borrowing of the company.
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Pg. 8 Information

Ratio Analysis (Profitability

Ratio)
This portion presents how Jollibee Foods Corporation is profitable enough
for the investors will be attracted to invest in this company.

Net Profit Margin

Net Income P6,672,582
/ /
Sales P126,229,530
=0.0529/ 5.290% (rounded)
The table shows the ratio in in profit which means that after
deducting all of the expenses of the comapny there will be 5.290% will be
left.

Return on Assets
Net Income P6,672,582
/ /
Average Assets P81,256,123.5
=0.0821/ 8.210% (rounded)
The table attributes to a lower profit and higher average total assets.
It means that is taking more assets are used to generate the same amount
of profits for the company.

Return on Equity
Net Income P6,672,582
/ /
Average Equity Holder P38,416,691.5
=0.1737/ 17.37% (rounded)
The table indicates that the owners are able to generate 17.37%
return for each peso investment they made to the company.

Earnings per Share

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Pg. 9 Information
Net Income =6580
/
Number of Common Shares
Outstanding
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Pg. 10 Information

Ratio Analysis (Activity

Ratio)
This portion presents how Jollibee Foods Corporation is efficient
enough in generating cash inflows and revenues.

Asset Turnover Ratio

Sales P126,229,530
/ /
Average Assets P81,256,123.5
=1.55 times(rounded)
The table indicates the company is effectively using their
assets to generate sales with an assets turnover ratio of 1.55 times.

Accounts Receivable Turnover Ratio

Credit Sales P1,565,982
/ /
Average Accounts Receivable P3,658,887.5
=0.43 (rounded)
The table shows that the company has a 0.43 accounts
receivable turnover ratio.

Average Collection Period

360 360
/ /
Accounts Receivable Turnover 0.43
=837.21 days (rounded)
The table shows that the company is efficient in collecting the
receivables for having an 831.21 days of collection.

Accounts Payable Turnover Ratio

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Pg. 11 Information
Purchases P13,905,845
/ /
Average Accounts Payable P25,254,613
=0.5510 times (rounded)
The table shows that the company has a 0.5510 times
accounts payable turnover ratio.

Average Payment Period

360 360
/ /
Accounts Payable Turnover 0.5510
=653.36 days (rounded)
The table shows that the company is feasible enough in paying
the payables incurred for the company’s sake.

Inventory Turnover
Cost of Sales P1067,658,140
/ /
Accounts Inventory P6,411,430
=16.79 times (rounded)
The table shows that the company has an inventory turnover
ratio of 16.79 times.

Average Inventory Period

360 360
/ /
Inventory Turnover 16.79
=21.44 days (rounded)
The table shows that the Jollibee Foods Corporation is able to
sell its inventory to customers which may reduce risk of obsolete
products.

Question:

1. Which company is much better to invest your money? Why?

With further investigations and evaluations of the two companies which are
Jollibee Foods Corporation and Security Bank Company, my findings were as
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Pg. 12 Information
follows: JHC had gained enough profit for the year 2017 while SBC was just the
same however in SBC there is an indication of net loss; JHC had spread already
with a splendid of branches throughout the world, on the other hand, SBC is still
on process; and JHC’ largest operators performance is looking better but
amazingly, SBC is in a great position since the liabilities had decreased and the
assets had increased. If I am going to invest in any of the two, I would rather
choose the both of them, since an entrepreneur is a risk taking individual and the
two companies show a good performance in genreting income for the company. I
will invest fairly the 1/3 to SBC and 2/3 to the JHC, its just because a bank could
go bankcrupcy in a matter of time without even a blink of eye while in JHC there
is a possibility of continuous progress and it is hardly to go bankcrupcy
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Contact Information
This output is presented by the first image and it has been presented to the
second information

Carl Justin A. Ballerta

12-Machiavelli Student
Tel 09652312969
Fax n/a
[email protected]

Joanne Taculog
Business Finance Teacher
Tel n/a
Fax n/a
[email protected]

Company
Information
Jollibee Foods Corporation and Security Bank Company
Manila, Philippines
Tel 722-765-3334
Fax n/a
www.analysisof2companies.edu.ph