Question

You are an analysts at an investment bank that is compiling information on listed companies to distribute to clients (investment fact sheet). The fact sheet is to be no longer than 2 pages and need to include information on the company’s: name Orica Ltd Mining Company based on Annual Report 2019.

(a) Background

a. What the company does

b. Directors

c. Remuneration

d. Other interesting facts

(b) Analysis of the company’s industry/competitors

(c) Key financial results a. Select some results that would be interesting for investors

(d) Key ratios

a. Liquidity

b. Solvency

c. Utilisation

d. Profitability

e. Market based

(e) Your recommendation: Suggest whether to buy, hold or sell.

Answer 1

1.what the company's does : Orica Limited manufactures and distributes commercial blasting systems, and mining and tunnelling support systems to the mining and infrastructure markets, as well as provides various chemical products and services. It offers mining services comprising bulk systems, packaged explosives, electronic blasting systems, initiating systems, and blasting services to the surface and underground mining, civil tunnelling, quarrying, construction, and oil and gas markets.

2. Board members : MALCOLM BROOMHEAD AO,ALBERTO CALDERON othera they are qualified and did their PhD in Econ and administration is good and having good experience.

3. Remuneration : their remuneration is based in performance alignment and almost more than 50 percentage of salary based on performance.itbis very good to have these kind of policy.

4: Important points include ratios

EBIT(2) of $665 million, up 8% on the pcp with strong
business performance across all regions and improvement
in manufacturing operations
• Underlying earnings per share(3) up 14% to 97.9 cents per share
• Ammonium nitrate (AN) volumes up 4% on the pcp at
3.97 million tonnes
• Sales revenue of $5.9 billion increased by 9% from higher
volumes and services, increased penetration of advanced
products and favourable foreign exchange movements
• Strong performance from technology, GroundProbe™
and Minova
• Individually significant items of $127 million after tax,
largely arising in the first half of this year
• Net operating and investing cash inflows(4) of $378 million
• Capital expenditure of $424 million(5) includes $37 million
on rectification works at Burrup
• Net debt(6) of $1.6 billion and gearing(7) at 34.9%
• Final dividend of 33.0 cents per share (5.0 cents franked),
bringing the full year dividend to 55.0 cents per share

5: It is a cash rich company having good liquidity ratios and solvency ratios and good rating.

6: Statutory net profit after tax (NPAT) attributable to the shareholders
of Orica for the year ended 30 September 2019 was $245 million;
NPAT before individually significant items(1) was $372 million, up
15% on the prior corresponding period (pcp).

7: The industry is going very fastly and the profit grown almost 15 percent and better to invest in this kindbod company hanging good fundamentals in the stock