Financial Ratio Analysis

.
FINANCIAL RATIO ANALYSIS
OF
DURDANS HOSPITAL & ASIRI HOSPITAL
An Executive Report
Prepared By:
Mr.S.L.Siraj [Index No- PGDBM/12/73]
Course: PGDBM 1242 – Financial Management
Facilitator: Mrs.WADK Jayandrika
Semester I, 2015
FACULTY OF BUSINESS STUDIES & FINANCE
WAYAMBA UNIVERSITY OF SRI LANKA
2015

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ACKNOWLEDGEMENT
First and foremost, I thank the almighty God for bestowing me with good health and confidence
to complete the project on time.
I take this opportunity to thank the Wayamba University of Sri Lanka for giving me a chance to
do this project.
I express my sincere gratitude to the Head of Financial Management Mrs. WADK Jayandrika
and other teachers for this constant support and helping for completing the project.
I am also grateful to my friends for giving support in my project. Lastly, I would like to thank
each and every person who helped me in completing the project especially my Parents.
S.L.Siraj
Place : Krunegala
Date: 29th
July 2015

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EXECUTIVE SUMMERY
Ratio Analysis is one of the techniques of financial analysis where ratios are used as a yardstick
for evaluating the financial condition and performance of a firm. Analysis and interpretation of
various accounting ratios gives a better understanding of financial condition and performance of
firm. It provides data for intra-firm comparison. They also revel financially strong and weak
such as overvalued and undervalued of firms. These ratios help to indicate a company’s
efficiency in the past and likely performance in future. It should be noted that computing the
ratios does not add any information in figures of profits and sales. Trend ratios involve a
comparison of the ratios of a firm over a period, that is present ratios involve a comparison of the
ratios of a firm.
S.L.Siraj
Place : Krunegala
Date: 29th
July 2015

Page 4
CONTENTS PAGE
Chapter 1: Introduction
5-8
 Purpose of the study 9
 Objectives of the study 9
 Methodology 9
 Limitations of the study 9
Chapter 2 :Theoretical Analysis 10
 Data table 11
Chapter 3: Data Presentation And Analysis
12-19
Chapter 4: Summary Of Ratios’ Data And Findings
20
Chapter 5:Conclusions And Recommendations
21
Chapter 6: List Of References
22
Appendix : Statements
23 - 25

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INTRODUCTION
 Asiri Hospitals
We are Sri Lanka’s leading surgical services provider, offering the most comprehensive range of procedures
and facilities utilising the latest advances in medical and clinical technology. Our international standards of
quality, superior patient care and consistent focus on innovation has enabled us to set ourselves apart in a
highly competitive industry. As part of Sri Lanka’s leading private healthcare group, Asiri Surgical Hospital
together with our sister companies, take great pride in setting industry benchmarks for healthcare in the
country.
Vision: To be the leading healthcare provider in South Asia with highest quality of clinical performance and
customer care with cutting-edge technology
Mission: To care for and improve the quality of human life, through the provision of ethical healthcare
solutions together with professional and compassionate staff.
Risk Management
We adopt a proactive approach towards risk management. The key risks, the potential impact and methods of
mitigation adopted by the Group are as follows;
Risks and Potential
Impact
Mitigation
Technological risk
Frequent innovations are a norm in the industry, and a
hospital’s inability to adopt the latest, cutting-edge
technology could result in loss of customers, leading
to fall in revenue and erosion of profitability. This risk
could also give rise to reputation and clinical risk.
The Group constantly seeks to adopt the most
advanced methods for diagnostics and treatment.
Research and innovations in the industry are
monitored on an ongoing basis.
Credit Risk
This risk arises from the non-settlement of bills by
individual and corporate clients, leading to financial
losses.
Interim bills are issued for in-patients requesting
period bill settlement. For corporate clients, a credit
assessment is carried out prior to granting credit
facilities.
Interest Rate Risk
The risk that arises from the adverse movements of
interest rates, resultantly affecting the Group’s interest
cost and thus profitability.
The Finance team continuously monitors the trends
in market interest rates and negotiates with banks
accordingly, in order to minim
Information Risk
Given the sensitivity and confidentiality of patient
related information held by the hospitals, the Group is
exposed to information risk in the event of technical
and IT system failures.
Regular maintenance of computer hardware and
software, off-site storage and daily back-ups as
well as round the clock IT support is available in
order to mitigate this risk
With a bed capacity of 160, a staff pool of over 1100 and 225 specialist consultants we are Sri Lanka’s
foremost surgical care provider. Commencing operations in 2004, we have over the last decade cemented

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our position as one of Sri Lanka’s leading private healthcare facilities, offering increasingly more
comprehensive and integrated treatments and facilities.
Accreditations and Certifications
We have obtained multiple international accreditations for various aspects of our operations, thus providing
independent assurance to our stakeholders on the quality of our service offering.
 ISO 14001:2004 - Environmental Management System
 OHSAS 18001:2007- Occupational Health and Safety Management System
 ISO 22000:2005 - Food Safety Management System
 ISO 9001:2008- Quality Management System (Laboratory)
 Durdans Hospital
Durdans Hospital is an established and respected tertiary healthcare provider in Sri Lanka, focusing on
patient care above all for Sri Lankan and overseas patients. It is a modern, multi-speciality private hospital
with state-of-the-art medical facilities, conveniently located in the heart of Colombo.
Since 1945, generations of Sri Lankans have been cared for by Durdans Hospital, a trusted and recognised
name for patient healing. Today, it is synonymous with the medical expertise, trusted nursing care and
modern facilities that has become our tradition: its all about caring. The new
Sixth Lane Wing continues to embody tradition with a higher level of dedicated service, care and attention in
a pleasant environment. We oer
our patrons a further selection of rooms with improved service areas, specialised consultation rooms, new
theatres and additional critical care.
Our Sixth Lane Wing theatre complex comprises of ve new specialised theatres equipped with cutting edge
technology for general surgery, obstetric surgery, genitourinary surgery, orthopaedic surgery and
laparoscopic surgery.
Vision: Durdans to be acknowledged regionally as the leading healthcare partner to the community at large.
Mission: Our management team and professionally trained sta supported by cutting edge technology will
deliver globally compatible patient care in an innovative, trusted and safe environment. We at Durdans are
committed to a customer centric culture to create a positive impact upon all our stakeholders.
Risk Management
Enterprise Risk Management covers strategies, techniques and approaches in recognising, acting upon and
mitigating any current or potential threat the organisation could encounter which would hamper the progress
of the organisation. Today it covers not only the conventional financial and insurable hazards but transcends
into a wide variety of strategic, operational, reputational and regulatory information risks. With over six
decades of experience behind us we have become exceptionally competent in taking calculated, prudent risks
to support our objectives.The processes are validated periodically to ensure best fit to emerging needs.

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 Risk Management Committee – the functions of the committee include proactively mapping the
potential risks, assessing the likelihood of occurrence, and assessing the impact of each event on the
business.
 A risk-awareness culture is being created throughout the organisation by educating the team leaders
on the risks faced by the organisation. This awareness and training has been put into practice in each
area of functions and thereby risks of the organisation at an operational level are mitigated and
managed.
 The accountability and the responsibility of each type of risk has been identified and are reviewed
periodically.
 Empower business areas/departments to be responsible for managing risks in accordance with the
organisation’s Risk Management policy and reward risk optimisation initiatives – necessary training
has been provided to all the departments for the successful monitoring and management of identified
risks.
 Generate continuous assessment and improvement – the process is monitored on an ongoing basis for
necessary interventions.
Risk Management Process at Durdans
The following process is in place, and will continue to be reviewed at the beginning of every year.
 Identifying the potential risks
 Identifying the level of the impact, in the event it occurs
 Identifying the likelihood of occurrence
 Mapping the risk in the Risk Rating Matrix
 Deciding on the action plan to mitigate or manage the risk
The committee holds full responsibility in applying an effective Risk Management Strategy in the company.
The identified risk and suggested managing methodologies will be reported to the Group Management
Committee by the Risk Management Committee and the Group Management Committee will review the
effectiveness of the action plans and monitor the implementation.
Clinical Risk
Clinical risks are detrimental to our business. We believe in mitigating the Clinical risks by creating high
quality standards and paramount safety standards in what we do every day. At the same time the team
deliberates extensively to identify any potential risk to the patients, and to ensure preventative measures are
in place.
Operational Risk
The Group aims to reduce operational risks such as damages to property, interruption to business and
liability that could form a risk to our business through active risk reduction measures. The objective of our
operational risk management is to identify and minimise risks associated with operations, assets,
environment and personnel.
Economic Risk

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We operate in a highly volatile and dynamic environment, various factors that impact the economy of our
country, tends to have implications on the success of businesses in general. With healthcare being an almost
essential service we are somewhat insulated, compared to some other industries.
Industry Risk
The health care industry has been expanding at a rapid pace. During the past couple of years, we witnessed
significant investment by all contenders in the private healthcare space, resulting in a large number of beds
being added to the industry.
Financial Risk
With our continuous drive to invest in technical superiority, continuous investment becomes a critical need.
The organisation is mindful of the gearing levels and manages its borrowings carefully. Whilst meeting all
obligations on time, the management places the utmost diligence in monitoring any fluctuations in the
interest rates and uses extensive negotiations to obtain the best return for the organisation.
Credit Risk
With corporate customers and insurance companies comprising a significant share of our customer portfolio,
credit risks are constantly monitored. To mitigate the credit risk, the Group has devised a mechanism of
stringent monitoring, wherein credit limits are reviewed and renewed constantly, based on ratings generated,
pertaining to business volumes and speedy settlement records.
Reputation Risk
Reputation Risk may create immeasurable damage to the equity of the brand, if and when it happens.
Durdans guards its reputation with zeal, by carefully following laid down guidelines to handle consumer
grievance if any.
Patients and Staff Safety
Patient and staff safety is held in very high importance. We have evaluated this area in adequate depth and
have mapped out all potential areas with clearly defined actions being in place. Exposure to environmental
risk is a challenge that is real today.

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PURPOSE OF THE STUDY
Two companies’ balance sheet and profit & loss accounts are valuable information sources for identifying
risk taking and assessing risk management effectiveness. Although amounts found on these statements does
not provide valuable insights of performance so financial analysis and Interpretation is required for
determining good or bad performance of company and also for determining its causes. The study includes
the calculation of different financial ratios, Trend analysis, comparative income and Balance sheet. It
compares two years financial statements of the two companies to know its performance in these different
years.
OBJECTIVES OF THE STUDY:
 To analyze the short term solvency & liquidity position
 To evaluate the financial performance financial ratios
 To know the impact of various assets & liabilities on financial performance
 To know the liquidity, leverage, activity & profitability ratio of company
METHODOLOGY
Study Period:The period covered for the study is two year starting from financial year 2013 to 2014 of two
Hospitals
Method of data collection: The collection of the data of this report is separated into:
a. Primary data: The organization chart, various departments etc.
b. Secondary data: Source like company annual report
LIMITATIOMS OF THE STUDY
 The study is conducted on a general basis.
 Time Constraint
 Restrictions on Behalf of the companies

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THEORETICAL ANALYSIS
These ratios are calculated to measure the operating efficiency of the company. Beside management,
creditors, owners are also interested in the profitability of the company. Generally profitability ratios are
calculated either in relation to sales or in relation to investment.
01. LIQUIDITY RATIO:
Current ratio =
Current assets
Current liabilities
Indicates the extent to which the claims of short-term
creditors are covered by assets that are expected to be
converted to cash in a period roughly corresponding to the
maturity of the liabilities.
Quick ratio (or acid-test ratio) =
(Current assets-Inventory)
Current Liabilities
A measure of the firm's ability to pay off short-term
obligations without relying on the sale of its inventories.
02. LEVERAGE RATIOS :
Debt-to-assets ratio =
Total debt
Total assets
Measures the extent to which borrowed funds have been
used to finance the firm's operations.
Debt-to-equity ratio=
Total debt
Total equity
Provides another measure of the fund provided by creditors
versus the funds provided by owners.
03. PROFITABILITY RATIO:
Gross profit margin=
Gross Profits
Sales
An indication of the total margin available to cover operating expen
and yield a profit.
Net profit margin =
Profits after taxes
Sales
Shows after tax profits per dollar of sales. Subpar profit
margins indicate that the firm's sales prices are relatively
low or that costs are relatively high, or both.
04. ACTIVITY RATIOS:
Inventory turnover =
Sales
Inventory of finished goods
When compared to industry averages, it provides an
indication of whether a company has excessive or perhaps
inadequate finished goods inventory.
Fixed assets turnover=
Sales
Fixed Assets
A measure of the sales productivity and utilization of plant
and equipment.

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FINANCIAL RATIOS ANALYSIS & INTREPRETATION
DATA TABLE
The other data of Durdans Hospital& Asiri Hospital used in financial ratios analysis is as follow:
Asiri Hospital Durdans Hospital
2013 2014 2013 2014
Total Assets 4,581,797,015 4,476,972,110 3,795,605,521 4,166,293,376
Current Assets 1,561,930,356 1,598,814,918 659,631,197 770,919,922
Current Liabilities 614,139,347 978,227,003 683,951,417 864,639,166
Inventories 127,300,028 138,335,810 156,821,121 215,388,912
Sales 2,242,969,418 2,310,429,152 2,470,162,902 2,647,083,795
Cost of Service (1,226,679,197) (1,315,695,705) (990,271,816) (1,060,261,122)
Total Equity 3380121396 3019213837 2421561640 2608189206
Profit Before Tax (PBT) 1,767,266,686 505,504,873 218,830,821 198,765,333
Profit After Tax (PAT) 1,745,683,022 473,335,167 210,912,952 185,903,565
Market Price Per Shares 9.30 11.70 100.00 115.00
EPS 1.70 0.90 6.23 5.49
Gross Profit 1,016,290,221 994,733,447 1,479,891,086 1,586,822,673
Total Liabilities 1,201,675,619 1,457,758,273 1374043881 1558104170

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01. Liquidity Ratio
Liquidity ratio measures the ability of the firm to meet its current obligation (liabilities). In fact
analysis of liquidity needs the preparation of cash budget and cash and fund flow statement but liquidity
ratio, by establishing a relationship between cash and other current asset to current obligation, to provide a
quick measure of liquidity.
1.1 Current Ratio
Current ratio may be defined as the relationship between quick or liquid asset and current liabilities.
This is a measure of general liquidity & is most widely used to make analysis of short-turn financial position
or liquidity of firm. It is calculated by dividing the total current assets by total current liabilities.
Current Ratio = Current Assets
Current Liabilities
2013 2014 2013 2014
1,561,930,356/
614,139,347
1,598,814,918/
978,227,003
659,631,197/
683,951,417
770,919,922/
864,639,166
=2.54 =1.63 =0.96 0.89
INTERPRETATION
It measures whether or not a company has enough cash or liquid assets to pay its current liability over the
next fiscal year. The accepted benchmark is to have current assets at least as twice as current liabilities (i.e.
2:1).
Asiri Hospital :In the year 2013 the current ratio have had reached the acceptable benchmark, but in next
year have lost to maintain that good position. However, the hospital maintained a decent ratio to meet its
short term liabilities.
Durdans Hospital: In both years of 2013 and 2014 the current ratio for Honda has been lesser than the
accepted benchmark, as well as the industry average.However, the hospital maintained a decent ratio to meet
its short term liabilities.
Asiri Durdands
2.54
0.96
1.63
0.89
Current Ratio
2013 2014

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1.2 Quick Ratio
Liquid ratio is also termed as "Liquidity Ratio", "Acid Test Ratio" or "Quick Ratio". The true liquidity refers
to the ability of a firm to pay its short term obligations as and when they become due. A standard of 1:1
absolute liquidity ratio is considered an acceptable norm.
Quick ratio = Quick asset
Current Liabilities
2013 2014 2013 2014
1,561,930,356-
127,300,028/
614,139,347
1,598,814,918-
138,335,810/
978,227,003
659,631,197-
156,821,121/
683,951,417
770,919,922-
215,388,912/
864,639,166
=2.34 =1.53 =0.73 =0.64
INTERPRETATION
Asiri Hospital : Over the past two years, the liquid ratio has been than the accepted standard and industry average.
Also, Asiri Hospital’s liquid ratio is greater than 1.0 in the last two years. Therefore, it indicates that the company t
have the ability to repay all its debts by using its most liquid assets
Durdans Hospital: Over the past two years, the liquid ratio for Durdands Hospital has been less than the accepted
standard and industry average. Also, Durdands’s liquid ratio is less than 1.0 in the last two years. Therefore, it
indicates that the company did not have the ability to repay all its debts by using its most liquid assets
Asiri Durdands
2.34
0.73
1.53
0.64
Quick Ratio
2013 2014

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02.LEVERAGE RATIO
Leverage ratios are also known as capital structure ratio. These ratios indicate mix of funds provided
by owners & lenders. As a general rule these should be appropriate mix debt & owners equity in financing
the firm’s assets. Leverage ratios are calculated to judge the long long-term financial position of the
company. Some of the popular leverage ratios are:
2.1 Debt-Equity Ratio
Debt to equity ratio shows the comparison to equity this ratio tells that how much firm has ability to pay its
debt and if equity is more than the total debt of the firm so firm will face low risk. In nestle the firm has 3.62
against $ 1 to pay debt whereas Engro food has 1.30 to pay against $ 1 debt. Here Nestle has more ability to
pay its debt.
Debt-Equity Ratio = Total Debt
Net Worth
2013 2014 2013 2014
1,201,675,619/
3380121396
1,457,758,273/
3019213837
1374043881/
2421561640
1558104170/
2608189206
=0.36 =0.48 =0.73 =0.57
INTREPRETATION
Asiri Hospital : The Asiri Hospital has 0.36 against Rs 1 to pay debt in 2013 and id has increased in 2014
to 0.48, it is maintain a good position.
Durdans Hospital : The Durdands Hospital has 0.73 against Rs 1 to pay debt in 2013 and id has decreased
in 2014 to 0.57, it is not favourable situation.
However Durdands Hospital has more ability to pay its debt.
Asiri Durdands
0.36
0.73
0.48
0.57
Debt-Equity Ratio
2013 2014

Page 15
2.2 Total Debt Ratio
Debt to asset ratio shows if the firms have more assets regardless of total debt than that firm will easily pay
off its debts. Debt ratio may be used to analyze the debt ratio by dividing Total debt (T.D) by dividing
Capital employed (C.E) or net assets (N.A).
The total debt include short and long term borrowing from financial institutions, debentures, bounds,
deferred payments, arrangements for buying capital equipment’s bank borrowings, public deposits etc.
Debt Ratio = Total Debt
Net Asset
2013 2014 2013 2014
1,201,675,619/
4,581,797,015
1,457,758,273/
4,476,972,110
1374043881/
3,795,605,521
1558104170/
4,166,293,376
=0.27 =0.33 =0.36 =0.37
INTERPRETATION
The ratio shows the company’s ability to cover its debts through its total assets. The ratio has to be low.
Asiri Hospital : Over the past two years, the debt equity ratio for Asiri Hospital has been less, which is favorable
and indicates less risk.
Durdans Hospital: Over the past two years, the debt equity ratio for Durdands Hospital also has been less,
which is favorable and indicates less risk.
So, the Durdands Hospital is more favorable than the Asiri Hospital. So we can interpret that the risk of the
firm is getting higher as the ratio goes up.
Asiri Durdands
0.27 0.36
0.33
0.37
Debt Ratio
2013 2014

Page 16
03. PROFITABILITY RATIO
These ratios are calculated to measure the operating efficiency of the company. Beside management,
creditors, owners are also interested in the profitability of the company. Generally profitability ratios are
calculated either in relation to sales or in relation to investment. The various profitable ratios are:
3.1 Gross Profit Ratio
G.P.Ratio measures the relationship between gross profits & sales; it is usually represented in percentage.
Thus Gross profit margin highlights the production efficiency at a concern
G.P.Ratio = Gross Profit X 100
Sales
2013 2014 2013 2014
1,016,290,221/
2,242,969,418
994,733,447/
2,310,429,152
1,479,891,086/
2,470,162,902
1,586,822,673/
2,647,083,795
=0.45 =0.43 =0.61 =0.61
INRTEPRETATION
It tells that how much a firm will receive against Rs 1 sales.
Asiri Hospital : The Asiri Hospital has 0.45 in 2013 and decrease to 0.43 in 2014 so the efficiency of firm is
not satisfactory.
Durdans Hospital :The Durdands Hospital has 0.61 in 2013 and 2014 it is maintains same position it is in
satisfactory level.
So in this case Durdands Hospital is earning more profit than Asiri Hospital.
Asiri Durdands
45% 61%
43%
61%
G.P.Ratio
2013 2014

Page 17
3.2 Net profit ratio
Net profit margin is calculated by dividing the net profit after taxes by the sales means after paying the taxes
you are earning some of the profit it means firm is doing its business well. This ratio is used as a measure of
overall profitability & it helps in determining the efficiency of the firm to carry on its business.
Net Profit Ratio= Net Profit after tax X 100
Sales
2013 2014 2013 2014
1,767,266,686/
2,242,969,418
505,504,873/
2,310,429,152
218,830,821/
2,470,162,902
198,765,333/
2,647,083,795
=0.79 =2.2 =0.09 =0.08
INRTEPRETATION
Asiri Hospital : was earning 0.79 or 79% against Rs 1 in 2013 and it is suddenly decreased vastly to low
level of 2.2 or 22% in 2014 so it is not favourable
And Durdands Hospital : was earning 0.09 or 9% in 2013 and 0.08 or 8% in 2014 it is maintains same
position and that is favourable but have to increase the profitability ratio.
Asiri Durdands
79%
8%
220%
9%
Net Profit Ratio
2013 2014

Page 18
04. TURNOVER RATIO
4.1 Inventory turnover Ratio
Inventory turnover ratio indicates the number of times stock has been turned over during the period &
evaluates efficiency with which a firm is able manage inventory.
The ratio is calculated by dividing the net sales divided by average inventory at cost.
ITR= Net Sales .
Average Inventory at Cost
Average inventory should be taken for calculating stock turnover ratio. Adding the stock in the beginning &
at the end of period & dividing it by 2 to calculate average inventory
2013 2014 2013 2014
2,242,969,418/
127,300,028
2,310,429,152/
138,335,810
2,470,162,902/
156,821,121
2,647,083,795/
215,388,912
=17.62 =16.07 =15.75 =12.29
INTERPRETATION:
Inventory turnover is calculated by dividing the CGS by inventory.
Asiri Hospital :The inventory turnover of Asiri Hospital has decreased from 17.62 to 16.07 in the year 2013 to
2014
Durdans Hospital : and the inventory turnover of Durdands Hospital also has decreased from 15.75 to 12.29 in
the year 2013 to 2014
Asiri Durdands
17.62 15.75
16.07
12.29
I.T. Ratio
2013 2014

Page 19
4.2 Assets Turnover Ratio:
Assets are used to generate sales. Therefore a firm should manage its assets efficiency to maximum sales.
Assets turnover ratio shows relationship between sales & assets. The various assets turnover ratio are:
Net Assets Turnover Ratio = Sales
Net assets
2013 2014 2013 2014
2,242,969,418/
4,581,797,015
2,310,429,152/
4,476,972,110
2,470,162,902/
3,795,605,521
2,647,083,795/
4,166,293,376
=0.49 =0.52 =0.65 =0.64
INTREPRETATION
This ratio measures the turnover of the entire firm’s asset. It is calculated by dividing the sales by total
assets of the firm. If firm shouldn’t increase its sales so there is a possibility that a firm will sale its some
assets.
Asiri Hospital :There were 0.49 chances of asset turnover in 2013 and it increased to 0.52 chances in 2013
in Asiri Hospital against every Rs 1.
Durdans Hospital : There were 0.65 chances of asset turnover in 2013 and it just decreased to 0.64 chances
in 2014 in Durdands Hospital against every Rs 1.
Asiri Durdands
0.49 0.65
0.52
0.64
Net Assets Turnover Ratio
2013 2014

Page 20
FINDINGS:
FINDINGS : Asiri Hospital FINDINGS : Durdands Hospital
In the year 2013 current ratio was 2.54 had reached
the benchmarked but in 2014 decreased to 1.63 it
missed to maintain the same standard ratio, so it is
unfavourable of the company.
The current assets ratio as per calculation it is
observed that, it has been decreased by 0.96 to 0.89
from 2013 to 2014. It don’t reaches the standard
ratio in both years, so it is unfavourable to the
company
Quick ratio has been suddenly decreasing year by
year vastly; it shows that company’s liquidity
position is weak.
Quick ratio has been little bit decreasing year by
year but not weak position due to compare with the
previous year.
Debt Equity Ratio in the year 2013, 0.04 following
year increased year by year company position is
unfavourable.
Debt Equity Ratio in the year following year has
been decreased year by year so it is favourable for
the company.
Debt equity ratio has been increased from 0.36 to
0.48 in 2013 to 2014 so it is maintain a good
position but paying ability is in lower level have to
increase.
Debt equity ratio has been decreased from 0.73 to
0.57 in 2013 to 2014; the debt paying ability is
favourable but has failed to maintain it.
Gross profit ratio has been fallen from 0.45 to 0.43
so the efficiency of firm is not satisfactory
Gross profit ratio has been maintain in the same
position with the favourable stage so the efficiency
of firm is in satisfactory level.

Page 21
CONCLUSION
After all the findings, it is concluded that financial ratios are the basic and most
important part of any business. It describes the firm’s financial position. As the data
indicates that Durdands Hospital is an international service and has expanded its
services on the online facility and also offers the large range of products, but on the
other side Asiri Hospital gains the customer trust and offers the wide range of services
in the medical sector by providing the specialist doctors to the reasonable price and
more customer relation and friendly.
From the financial statements it is clear that the financial position of Durdands
Hospital is far better than Asiri Hospital as it is more preferred by the customers and
also an internationally distributed. It also has less risk but some time failed to maintain
the same position in other hand the Asiri Hospital maintain the same standards with
unfavourable . Durdands Hospital gives more return because it gains more profit than
Asiri Hospital. Both the companies have some opportunities and threads and they need
to work on it.

Page 22
References
1. Durdands Hospital annual report 2013 & 2014
2. Asiri Hospital annual report 2013 & 2014
3. http://www.durdans.com/
4. http://www.asirihospitals.com/

Page 23
Durdands Hospital’s Income and Financial Positions

Page 24

Page 25
Asiri Hospital’s Income and Financial Positions

Financial Ratio Analysis

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