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Financial Analysis

Extracts from this document...

Introduction

1 Introduction The objective of this project is to analysis the performance of two listed Australia-based companies in the automotive parts manufacturing industry, namely Pacifica and Orbital, through various analysis techniques learnt in IND3315. Pacifica is the primary company we are looking into and Orbital Prediction on future performance of both companies will be made in this report base on thorough study of different aspects of them such as their history, financial statements in the past four years and other major operational and external changes. The four main areas that we are looking into are the liquidity, gearing, profitbility and management performance of both campanies. Comparision between both companies will also be conducted to disclose the prospect in the automotive part sector in Australia and around the globe. Some advices on how to improve the performance of the companies will be provided at the end of the report. This report is divided in two parts in which Ken is working on the Pacifica and Jay on the Orbital. 2-Part A-Pacifica Group Limited 2-1 Profile Pacifica Group Limited is engaged in the manufacture and supply of brake systems and technologies to automotive manufacturers in Australia, North America, Europe and Asia. Pacifica listed on the Australian Stock Exchange as Pacific BBA in 1989 as a manufacturer of brake and clutch systems and components, industrial plastics and textiles. In 2001, in order to concentrate on those areas in which the company had strategic and sustainable competitive advantage, Pacifica announced its intention to transform from a diversified industrial into an automotive technology company. As a result, almost all activities other than those based on superior automotive technology have now been divested. On May 1, 2006, Pacifica Group Limited sold its interests in Melwire Pty Ltd and Mounts Wire Industries Ltd, thereby completing the divestment of its Construction Products division. In late November 2006, a Germany Company, Robert Bosch, take over Pacifica. ...read more.

Middle

an international developer of engine and related technologies, providing research, design, development and testing services to the world's powertrain producers for application to motorcycles, marine and recreational vehicles and automobiles. Operations in Perth, Australia, provide customers with leading edge expertise and a world class facility unparalleled in the Asia Pacific region. Orbital's direct injection technology - designed to improve the emissions and fuel consumption of internal combustion engines - has been commercialised in the motorcycle, marine and recreational markets. The Orbital group earns income from multiple sources: * Consulting and engineering services fees * Licence fees and royalties paid by manufacturers * who acquire rights to Orbital's intellectual property * The sale of fuel systems and components through * Synerject, a joint venture with Siemens VDO 3-2 Operation 1. Orbital Corporation offers the development and technology to various powertrain manufacturers for application to mostly motorcycles, marine power, recreational vehicles. The big two wheeler makers such as Aprilia, Peugeot, Piaggio (Vespa), 3 of 4 largest European scooter manufacturers have adopted the technology from Orbital Corporation. The license sold to all over the world (mainly to Europe and India). 2. Orbital offers the full range of engineering services from the provision of testing facilities through to complete turnkey solutions for the power train needs (gasoline, diesel, alternative fuel). Most of the engineering testing services operating in Perth, Australia. 3. Orbital has been involved in numerous OEM projects to develop or assist in the development of engine designs (application of fuel injection system, small engine 2, 4 stroke applications) through to multi-cylinder head and engine design for automotive applications. 4. The company provides the service which is developing solutions for engine control system (EMS). The group has a depth and breadth of experience derived from having delivered engineering programs on a diverse product range covering automotive, motorcycle, marine and recreational vehicles. 5. Synerject is Orbital's 50:50 US-based joint venture with Siemens-VDO Automotive Corporation. ...read more.

Conclusion

2.92 3.39 3.3 Total Inventory 0.01 0.01 0.03 0.09 Prepaid Expenses 0.02 0.07 0.44 0 Other Current Assets -- -- 0.02 0.7 Other Current Assets, Total -- -- 0.02 0.7 Total Current Assets 6.97 10.97 16.22 13.1 Buildings 3.06 3.06 3.06 3.06 Land/Improvements 1.09 1.09 1.09 1.09 Machinery/Equipment 14.81 14.68 17.94 21.67 Construction in Progress -- -- -- 0 Leases -- -- 0.6 0.67 Other Property/Plant/Equipment 1.96 1.96 1.96 -- Property/Plant/Equipment, Gross 20.92 20.79 24.66 26.49 Accumulated Depreciation -14.49 -13.37 -16.21 -16.11 Property/Plant/Equipment, Net 6.43 7.42 8.45 10.38 Intangibles, Net -- -- -- -- Other Long Term Investments 6.32 0 -- -- Total Long Term Investments 6.32 0 -- -- Deferred Income Tax - Long Term Asset 6.45 6.3 -- -- Other Long Term Assets -- -- -- 0 Other Long Term Assets, Total 6.45 6.3 -- 0 Total Assets 26.17 24.69 24.67 23.48 Accounts Payable 2.66 2.01 2.6 3.23 Notes Payable/Short Term Debt 0 0 0.17 0.14 Customer Advances 0.61 0.38 1.26 0.74 Income Taxes Payable -- -- -- 0 Other Current Liabilities 1.15 1.54 1.55 2.53 Other Current Liabilities, Total 1.76 1.92 2.8 3.27 Total Current Liabilities 4.42 3.93 5.57 6.64 Long-Term Debt 12.81 19 19.01 19.2 Total Long Term Debt 12.81 19 19.01 19.2 Total Debt 12.81 19 19.18 19.34 Deferred Income Tax - Long Term Liability -- -- -- -- Total Deferred Income Tax -- -- -- -- Other Long Term Liabilities 1.2 1.89 5.37 9.63 Other Liabilities, Total 1.2 1.89 5.37 9.63 Total Liabilities 18.43 24.82 29.95 35.47 Common Stock 216.77 216.77 216.77 213.47 Total Common Stock 216.77 216.77 216.77 213.47 Retained Earnings -209.06 -216.66 -222.05 -225.45 Translation Adjustment 0.04 -0.24 -- -- Other Equity, Total 0.04 -0.24 -- -- Total Stockholders' Equity 7.74 -0.13 -5.28 -11.98 Total Liabilities and Shareholders Equity 26.17 24.69 24.67 23.48 Shares Outstanding - Common Stock, Primary Issue 411,292,090 410,595,880 410,017,880 379,979,580 Total Common Shares Outstanding 411,292,090 410,595,880 410,017,880 379,979,580 Treasury Shares - Common Primary Issue -- -- 0 0 ?? ?? ?? ?? ...read more.

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