The following is PT GHI's statement of financial position and income statement as of December 31, 2016:
Based on the financial statements above, make the following analysis:
a). Describe the condition of PT GHI based on liquidity, profitability and solvency (3 ratios each).
b). PT GHI received a project with an investment value of 150 million based on a 5-year projection calculation (ke = 12.5%), is the investment feasible? Calculate using the NPV, IRR and Payback Period. For the 5-year projection of PT GHI as follows:
- Income increased 15% per year
- Cost of goods increased by 5% every year.
- Administrative and operational costs increased by 7% per year
- Depreciation and interest costs are assumed to be fixed per year
Note: When calculating discounted cash flow, the annual cash flow is EBITDA.
c). Based on the cash flow projection, calculate how much risk to the project with the following probabilities: 2017 (45%), 2018 (55%). 2019 (50%), 2020 (35%), 2021 (40%).
d). Suppose it is known that for each loan interest from Mr K (7%), Mr L (10%), Mr M (12%) what is the WACC from PT GHI? (Tax assumption: 25%) If it is known that the loan interest rate is 12.5%, is the cost of funds efficient?
PT GHI Statement of Financial Position Per 31 Desember 2016 Current assets liabilities Cash 15.000.000 Short-term liabilities Bank 17.500.000 Accounts Payable 47.500.000 Accounts Receivable 22.500.000 Stock 25.000.000 Long-term obligation Prepaid expenses 15.000.000 Debt Mr. K 17.500.000 Total Current Assets: 95.000.000 Debt Mr. L 22.500.000 Debt Mr. M 22.500.000 Total Liabilities 110.000.000 Fixed assets Equity Fixed assets (Net) 55.000.000 Capital 15.000.000 Retain earning 25.000.000 Total Equity 40.000.000 Total Asset 150.000.000 Total Liabilities & Equity 150.000.000 PT GHI Income statement Per 31 Desember 2016 income 65.000.000 Cost of Goods 15.000.000 Gross income 50.000.000 Admin & operational costs Salary expense 7.500.000 Equipment Costs 2.500.000 Utility Costs 3.500.000 Building maintenance costs 6.500.000 Vehicle maintenance costs 3.500.000 Depreciation Fee 1.000.000 Interest Costs 500.000 Total Adm & Operational Costs 25.000.000 Net income 25.000.000
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