BMGT 495

Keppel Corporation Ltd

Samsung Heavy Industries

Hyundai heavy industries

CSF

Weight

Rating

Score

Rating

Score

Rating

Score

Business model

0.10

3

0.30

4

0.37

1

0.37

Talent management

0.15

2

0.30

3

0.24

2

0.48

Global networks of shipyards

0.11

4

0.44

2

0.05

4

0.20

Solid waste management

0.14

3

0.42

3

0.14

3

0.42

Executive resources

0.14

1

0.14

2

0.21

3

0.63

Strong pipeline of leadership

0.13

3

0.39

1

0.08

1

0.08

Staff well being

0.15

2

0.30

3

0.13

3

0.39

Ownership ethos

0.08

1

0.08

1

0.10

1

0.10

Total

1

2.53

1.32

3.62

SWOT Analysis

Opportunities

Threats

· Has an opportunity of spreading more in Europe.

· The rise in demand for electricity.

· Gas demand is still attractive.

· Key M&As are always successful

· Advancements in technology

· China is taking a larger share of the market.

· High prices of steel

· The local currency that is not strong

· Rig orders still low

· Carbon tax introduction.

Rig orders still low

0.13

2

0.26

A local currency that is very strong

0.07

2

0.14

Total

1

2.24

Strengths

Weaknesses

Facilities and location: Multiple international locations for fabrication and manufacturing.

Small customer base: The majority of revenue is tied to a small group of customers.

Supply management: Supply control though limited vertical integration.

Reliance on suppliers: Some critical components have a single source.

Growth:

As a public sector corporation, there is no allowance for capital expenditure and expansion.

The existing attentiveness to other industries could lead to trailing shares in shipbuilding.

Asset acquisition: Strategic acquisition of rival businesses and technologies.

Weight

Rating

Weighted score

Opportunities

Has an opportunity of spreading more in Europe

0.11

3

0.33

Rise in demand for electricity

0.24

2

0.48

Gas demand is still attractive

0.10

1

0.10

Key M&As are always successful

0.04

2

0.08

Advancements in technology

0.03

4

0.12

Threats

China is taking a larger share of the market.

0.17

2

0.34

Carbon tax introduction

0.03

1

0.03

High prices of steel

0.12

3

0.36

Internal Strengths

Weight

Rating

Weighted Score

Number and type of facilities

10%

3

0.3

International presence

10%

3

0.3

Control of supply

15%

4

0.6

Experienced management team

10%

3

0.3

Financial Ratios

5%

3

0.15

Internal Weaknesses

Sensitive to fluctuations in demand

15%

2

0.3

Sensitive to single-source suppliers

5%

2

0.1

Little diversification of products/customers

10%

2

0.2

Not currently profitable

15%

1

0.15

Financial Ratios

5%

1

0.5

poor (1), below average (2), above average (3), superior (4)

Total weighted score

100%

2.9

KEY FINANCIAL RATIOS

Formula

Calculation*

Industry Average**

Leverage Ratios

Long Term Debt Ratio

Long-term Debt / Total Assets

50,454 / 340,576 = 14.81

58.95

Debt-to-Equity Ratio

Total Liabilities / Total Shareholders' Equity

180,336 / 160,240 = 1.13

12.94

Liquidity

Cash Ratio

Cash and Cash Equivalents / Current Liabilities

58,185 / 116,383 = 0.5

1.06

Current Ratio

Current Assets/Current Liabilities

233,205 / 116,383 = 2.0

2.64

Quick/Acid Test

(Current Assets - Inventories)/Current Liabilities

(233,205 - 51647) / 116,383 = 1.56

1.6

Efficiency Ratios

Asset Turnover Ratio

Total Sales / (Beginning Assets + Ending Assets)/2

322,540 / (402,953+340,576)/2 = 0.87

0.68

Inventory Turnover Ratio

Cost of Goods Sold/Inventories

256,367 / 371,764.5 = 0.69

4.5

Profitability

Gross Profit Margin

(Net Sales - COGS) / Net Sales

(322,540 - 256,367) / 322,540 = 20.51

50.85

Net Profit Margin

Net Income/Sales

(43,637) / 322,540 = -13.53

23.52

Return on Equity (ROE)

Net Income/Average Shareholder's Equity

(43,637) / 160,240 = -27.23

25.86

*Financial data acquired from Sembcorp Industries Ltd 2018 Sembcorp Industries Ltd Annual Report Annual Report

**Industry Average data acquired from CSI Market