Introduction about Ibn Sina Pharma Company

Ibn Sina Pharma was established in 2001, and it is a leading Egyptian company
in the field of pharmaceutical distribution and ranks second in the Egyptian
market with a market share of more than 18.8% until September 2017. The
company is achieving the fastest growth rates in that promising market, as it
specializes in distributing the products of more than 350 companies. One of the
most prominent names in the pharmaceutical industry and personal care
products on the local and international arena, and its clients list includes more
than 35,000 clients from wholesalers and retailers, pharmacies, public and private
hospitals and health units spread across all Egyptian governorates.

Ibn Sina Pharma is unique in providing a variety of services to a wide range of

clients, including telemarketing services, receiving / delivering orders on the same
day, as well as developing and implementing innovative commercial activities and
campaigns, as well as warehouse management services and logistical support
networks for the benefit of a group of clients.

Ibn Sina Pharma has a fleet of trucks that includes about 600 commercial trucks to
cover all Egyptian governorates and quarters through branches and distribution
centers distributed over 55 locations, including storage warehouses, distribution
centers, and others.

Operational activities
Distribution
Ibn Sina Pharma specializes in the field of distributing medicines and personal
care products, as it distributes the products of hundreds of suppliers and
companies specialized in the pharmaceutical industry to serve pharmacies and
hospitals spread across the country through a fleet of trucks that includes more
than 600 commercial trucks. The company provides its services through a network
of branches and distribution centers spread across 55 locations in various
Egyptian cities, including storage warehouses, distribution centers, and others,
which guarantee the quality of storage and delivery of drug products that, are
sensitive to temperature. The company is unique in providing services to receive
orders and deliver them to customers, and it is the first company to introduce a
telephone sales model in the field of drug distribution in Egypt.

Warehousing and logistical support

Ibn Sina Pharma is unique with its tremendous experience in the fields of
medicine and personal care products distribution, as it owns a group of
warehouses equipped according to the latest technology for storing and
distributing medicine, and has an advanced system for managing supply and
supply activities with the use of the latest temperature control systems that
match the storage standards A distribution approved by the World Health
Organization (WHO). Consequently, the company provides its suppliers with an
excellent package of warehousing, logistical support and distribution services in
order to effectively contribute to achieving their operational goals.

Import and packing

Ibn Sina Pharma has succeeded in growing its business over the past years to
become one of the most prominent importers of nutritional supplements and
medical devices from major international companies and institutions. The
company is also working to sign new partnership agreements with the most
prominent suppliers around the world in an effort to meet the growing demand in
the Egyptian medical and pharmaceutical market, as well as enrich the lives of
customers by ensuring that they have access to safe and reliable pharmaceutical
products from the most prominent names in the world in the high-quality
pharmaceutical industry.

Commercial support
Ibn Sina Pharma is proud to provide the best level of customer service through a
"CRM" program specialized in customer relationship management, in an effort to
meet all their needs and respond to any inquiries or complaints while ensuring
that each customer receives the highest standards of service. The company also
employs the expertise of its best-in-class sales team in providing complementary
support services to its supply partners, including creating and launching
innovative promotions to attract new customers, as well as assisting in launching
and promoting new products. On the other hand, the marketing team conducts
analytical studies periodically to measure the performance of the drug market in
Egypt and study the reports issued by the International Foundation for Drug
Information and Consultation, and conduct continuous internal analyzes, as well
as opinion polls throughout the Republic with the aim of collecting data that
contribute to developing plans.

Customers
Ibn Sina Pharma distributes medicines and personal care products to more than
35 thousand customers from wholesalers and retailers, chains of pharmacies and
public and private hospitals, in addition to its active participation in tenders for
the supply of medicines and medical preparations. The company relies on a highly
efficient system to manage the supply and supply system to deliver more than
375,000 orders per month.

Suppliers
The company specializes in distributing a huge range of products from more than
325 companies from the most prominent names in the pharmaceutical industry
and personal care products on the domestic and international scene. The work
team is coordinating with supply partners in all stages of preparing and
developing commercial proposals, including following up planning, design,
distribution, analysis studies and subsequent follow-up. The company is also
working to help suppliers achieve their strategic goals by reaching targeted sales
rates, as well as enhancing the market position of the products it distributes.
Proplems of the company

In 2019, the company's sales decreased due to the general economic conditions
and some of the company's problems with pharmacies in terms of accepting
returns and expired items.

In 2020 one of the company’s officials suggested creating an electronic

application to sell medicines to the public to raise the company's sales, which led
to a major clash with pharmacies and the pharmacists ’union, which led to a
reduction in the volume of pharmacies’ dealings with the company

Before the end of 2020, the General Syndicate of Pharmacists issued a decision to
prevent dealing with Ibn Sina Company, which led to a significant decrease in the
company's sales volume.

Therefore, the company decided not to release this application in an attempt to

fix things with the General Syndicate of Pharmacists.

The company's financial analysis will show the decline in the company's profits as
a result of such decisions.
 Finnacial analysis of the company
Profitablity
Return on Equity
This percent measure how well the company employed the owners’ investments
to earn income indicates how much income was earned for every dollar invested
by the owners.
2016 2017 2018 2019 2020

Net profit 101,747,851 170,137,041 262,522,286 328,770,981 224,661,060

Average shareholders' equity 281,170,507 363,983,728 688,233,120 1,091,755,440 1,294,071,515

ROE 36% 47% 38% 30% 17%

It is clear that year 2017 is the best year in the five years in its return and shows
large decrease in year 2020 comparable by perveous years

Return on Assets
This percent measures how well assets have been employed by the business;
many analysts consider this ratio as the best overall measure of a company’s
profitability.

2016 2017 2018 2019 2020

Net profit 101,747,851 170,137,041 262,522,286 328,770,981 224,661,060

Average total assets 2,634,701,515 3,694,795,782 5,344,960,262 7,263,003,897 8,710,158,129

NET OF TAX 0.77 0.77 0.77 0.77 0.77

ROA 5% 6% 6% 6% 3%

by calculating ROA it shows decrase in year 2020comarable by pervious years

which indicate the problems the company faced in that year
Financial leverage
Is advantage or disadvantage that occurs as the result of earning a return on
equity that is different from the return on assets.

2016 2017 2018 2019 2020

Financial laverage 31% 41% 32% 25% 14%

Althought that all years percent are postive but years 2019 and 2020 confirm the
decraese of the company profits in last years .

50

45

40

35

30
ROE
25
ROA
20
Financial leavrage
15

10

0
2016 2017 2018 2019 2020

Earning pershare
Earnings per share are probably the single most widely watched financial ratio.
It is clear that year 2020 is the lowest earn in the five years
2016 2017 2018 2019 2020
EPS 0.15 0.22 0.3 0.28 0.19
Quality of Income
2016 2017 2018 2019 2020
cash flow from operating activity 215,642,221 436,409,025 -310,149,840 -24,834,936 251,873,722
Net profit 101,747,851 170,137,041 262,522,286 328,770,981 224,661,060
quality of income 2.12 2.57 -1.18 -0.08 1.12

In the five years 2016 and 2017 are of high quality and beter than the follwed
three years.

Gross Profit
This ratio tells us the percentage of each sales that is gross margin.

2016 2017 2018 2019 2020

Gross profit margin 7.90 8.62 8.44 8.67 7.85

after all expenses and taxes have been paid, the company was able to produce a
profit margin of 8.6 percent in 2017 and 2019 which are the best gross profit for
the company in five years.

Operating Profit Margin

This ratio tells us the percentage of each sales dollar that is operating margin.

2016 2017 2018 2019 2020

Operating profit margin 6.14 6.22 5.88 6.27 6.61

Profit margin tells us stable performance of the company all over five years.

Net Profit Margin

This ratio tells us the percentage of each sales dollar that is net income.
2016 2017 2018 2019 2020
Net profit margin 1.41 1.77 1.97 1.98 1.20

Net Profit margin tells us increas in the performance of the company all over five
years except last year.
10

5 Gross profit

4 operating profit margin

3 Net profit margin

2

0
2016 2017 2018 2019 2020
 Activity analysis
Fixed assets turn over
This ratio measures a company’s ability to generate sales given an investment in
fixed assets

2016 2017 2018 2019 2020

Net sales rev. 7372466698 9818405233 13323673931 16600459560 18678959243

Avearge net fixed assets 171326679 190795509.5 324342088.5 668319880 925467886.5

Fixed Assets turn over 43.03163256 51.46035805 41.07907793 24.83909286 20.1832603

By calculate the ratio for every year we found that 2017 was the best investment
for the fixed assets which show decrease in the last 2 years due to the increase of
the fixed assets of the company without the same increase in the net sales which
drive us to have alook at (Total assets turn over) to analyse this situation for all
assets of the company.

Total assets turn over

2016 2017 2018 2019 2020

Net sales rev. 7372466698 9818405233 13323673931 16600459560 18678959243

Avearge net total assets 3055795613 3694795782 5344960105 7263003740 8710158129

Total Assets turn over 2.412617737 2.657360734 2.492754608 2.28561903 2.14450289

By that ratio we can measure the company’s ability to generate sales given an
investment for all its assets witch show smaller diffrence in each year than fixed
assets turn over due to increase in Inventories, Debtors ,other debit balance, net
Cash & cash equivalent in last two years .
 60

50

40

Fixed assets turn over

30
Total assets turn over
20

10

0
2016 2017 2018 2019 2020

The chart shows clearly the stablity of Total assets turn over all over the five
years.

Recvable turn over

This ratio measures how quickly a company collects its accounts receivable.

2016 2017 2018 2019 2020

Net credit sales 7372466698 9818405233 13323673931 16600459560 18678959243

Average net recevable 1946303807 2202800060 3048265547 4047312931 4643889728

Recevable Turnover 3.787932116 4.4572385 4.370903298 4.101600209 4.02226589

As shown in the previous table the higher the turnover, the faster the cash
collection on accounts receivable which is found in year 2017.
Average age of Recevables
By calculation Average age of Recevables for the company to measure the
average number of days it takes to collect receivables year 2017 shows the
lowest number of days to collect receivables.

Average age of Recevables 96.36 81.89 83.51 88.99 90.74

Inventory Turnover
This ratio measures how quickly the company sells its inventory.

2016 2017 2018 2019 2020

Cost of goods sold -6803348347 -8991975056 -12199359376 -15161004836 -17212098107

Average Inventory 614350464 832585990 1225586888 1545498717 1895757499

Inventory Turnover 11.07 10.80 9.95 9.81 9.08

By measuring the number of times inventory is sold and replaced during the year
it shows the decrease of number of Inventory Turnover times throw the five years
which make the company in risk of obsolete inventory items.

Average age of inventory

Average age of inventory 32.96 33.80 36.67 37.21 40.20

By measureing the average number of days it takes by the company to sell its
inventory it shows the increase of number of days throw the five years which
make the company in risk of obsolete inventory items.

Accounts payable Turnover

This ratio measures how quickly the company pays its accounts payable.

2016 2017 2018 2019 2020

Cost of goods sold -6803348347 -8991975056 -12199359376 -15161004836 -17212098107

Average accounts payable 2519984745 3700785721 4753050593 5656995735 6408194289

payable Turnover 2.70 2.43 2.57 2.68 2.69

By calculating this ratio measures the number of times purchases on account are
paid for each year.

It shows best performancein year 2017 in the five years and it is clear in the next
ratio

Average age payables.

Average age of payables 135.20 150.22 142.21 136.19 135.89

160

140

120

100
Average age of Recevables
80
Average age of inv
60 Average age payables

40

20

0
2016 2017 2018 2019 2020

Cash conversion cycle

To Summarize the three averages which shows best performance in year 2017
 2016 2017 2018 2019 2020
6 34.55 22 10 5

cash conversion cycle

40

35

30

25

20

15 cash conversion cycle

10

0
2016 2017 2018 2019 2020

Tests of Liquidity
Liquidity ratio analysis is the use of several ratios to determine the ability of an
organization to pay its bills in a timely manner. This analysis is important for
lenders and creditors, who want to gain some idea of the financial situation of a
borrower or customer before granting them credit. There are several ratios
available for this analysis, all of which use the same concept of comparing liquid
assets to short-term liabilities.

Current ratio
The current ratio measures the ability of an organization to pay its bills in the
near-term. It is a common measure of the short-term liquidity of a business. The
ratio is used by analysts to determine whether they should invest in or lend
money to a business.

Current assets ÷ Current liabilities = Current ratio

The sudden rise in current assets over the past years indicates that company has
undergone a rapid expansion of its operations. Of particular concern is the
increase in accounts payable over the Years, which indicates a rapidly
deteriorating ability to pay suppliers.

Drwabacks of this ratio:

Inventory component and Paying from Debt

2016 2017 2018 2019 2020

Curent Ratio 1.05 1.02 1.11 1.09 1.06

Quick ratio
Measuring this ratio we can detect the ability of the company to pay immediate
debts which is stronger than current ratio.

Quick Assets ÷ Current liabilities = Quick ratio

Despite the absence of inventory from the calculation, the quick ratio may still not
yield a good view of immediate liquidity, if current liabilities are payable right
now, while receipts from receivables are not expected for several more weeks.
This can be a particular concern when a business has granted its customers long
payment terms.

Here, it's good comparing to Current Ratio as its close in ratios, so this means that
inventory not contributing much.

2016 2017 2018 2019 2020

Quick Ratio 0.82 0.75 0.83 0.82 0.78

cash ratio
The cash ratio compares a company's most liquid assets to its current liabilities.
The ratio is used to determine whether a business can meet its short-term
obligations, whether it has sufficient liquidity to stay in business. It is the most
conservative of all the liquidity measurements, since it excludes inventory (which
is included in the current ratio) and accounts receivable (which is included in the
quick ratio). This ratio may be too conservative, especially if receivables are
readily convertible into cash within a short period of time.

(Cash + Cash equivalents) ÷ Current liabilities = Cash ratio

2016 2017 2018 2019 2020
Cash Ratio 0.02 0.04 0.02 0.02 0.04
 0.9

0.8

0.7

0.6

0.5 Quick Ratio

0.4
Cash Ratio
0.3

0.2

0.1

0
2016 2017 2018 2019 2020

Through the five years the company show stable performance with low
ablity to be liquid .