Financial Analysis
Education Sector
featuring:
Centro Escolar University
Far Eastern University
STI System Holdings Inc.
To be submitted to Ms. Charina Rana
Presented by:
Bernal, Miguel Inigo Galen P.
Cerutti, Estelle Marie Lourdes A.
Fortuna, Mikhaela Denise T.
Ibuna, Karren Bernadette A.
Jostol, Marypaul S.
Ruiz, Jan Mari Enrico R.
Tabuena, Leonard Angelo C.
Vergara, Shanden T.
12F
DLSZ-Vermosa
March 2018
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Table of Contents
I. Executive Summary ……………………………………………………………..…………………………….. 2-4
II. Objectives ……………………………………………………………..…………………………………………….. 5
III. Comparative Financial Statements ………………………………………………………………….. 6-9
A. Statement of Financial Position (Balance Sheet)
B. Statement of Financial Performance (Income Statement)
IV. Liquidity Ratio ……………………………………………………………..……………………………………….. 10–11
V. Profitability Ratio ………………………………………………………………………………………………….. 12–13
VI. Efficiency Ratio ……………………………………………………………..…………………………………….. 14–15
VII. Financial Leverage Ratio …………………………………………………………………………………….. 16–17
VIII. Horizontal and Vertical Analysis .……………………………………….……………………………… 18–31
IX. Conclusion …………………………………………………………….…………………………………………….. 32
X. Bibliography …………………………………….……………………………………………………………………. 33
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I. Executive Summary
The Philippines highly regards education, which is often viewed as a primary avenue
for upward social and economic mobility (Florido, n.d.). It continues to play a vital role in
lifting a number of citizens from severe realities like poverty by providing employment to
individuals and good exposure to various job opportunities (Bautista, n.d). Given the
government and people’s undivided focus to the significance of receiving quality
education, the country wasted no time solidifying the core foundation of it, and has
enhanced quality learning all the way up to the highest form of education that one may
opt to attain.
Tertiary education is administered in several parts of the country across a myriad of
institutions, giving individuals an opportunity to acquire higher knowledge in a particular
field. The widespread recognition of how beneficial it is continues to ring true within the
Philippines, and as well as other parts of the world. With people securing the skills and
expertise passed onto them through tertiary education, the Philippine and global
economy is strengthened and unified to form a better and more holistic society. It
improves one’s quality of life individually as well, as it enables citizens to expand their
respective knowledge, apply new concepts, express their thoughts eloquently and
increase their understanding of the world and their fellow people (Allen, 2007).
Given the Philippines’ evident efforts in continuously improving the country’s
education industry, it is only proper that people of position and power recognize them and
help out in any way they can. Contributing financial and business efforts not only to the
educational aspect, but also the societal and economic attributes of the country is bound
to leave a sense of accomplishment and pride, especially knowing that these acts
enhance the capabilities Filipino individuals can bring in a worldwide scale.
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As a response to that, a detailed financial analysis was conducted by select
individuals to introduce three (3) promising tertiary institutions, namely Centro Escolar
University, Far Eastern University and STI System Holdings Inc.
Below are brief descriptions for each institution:
Centro Escolar University (CEU) upholds academic excellence and excels in
maintaining a dynamic force of professors, university staff and the overall university
community. With campuses located in Manila, Malolos, Makati and Cebu, it has been
accredited by the Philippine Association of Colleges and Universities Commission on
Accreditation (PACUCOA) as certified by the Federation of Accrediting Agencies of the
Philippines (FAAP) to properly recognize the excellence brought upon by the institution’s
programs, research tradition, graduates and development (Centro Escolar University: The
university, n.d.). Altogether, CEU ensures a quality learning system for all.
Far Eastern University (FEU), which originally began as an institute dedicated solely to
the field and profession of accountancy, has now branched out to other fields of study
and paved the way for other promising students to attain a great deal of knowledge in
their chosen professions (The FEU story, n.d.). Over the course of its run, FEU has
produced business tycoons, ambassadors, justices of the Philippine Supreme Court,
nurses, educators, and many more.
STI System Holdings Inc. (STI), as the holding company within the Tanco Group, is
divided into subsidiaries that all serve as reliable educational institutions. With its
campuses offering associate/baccalaureate degrees. technical/vocational degrees in a
number of fields, its accreditations and holistic reputation in the country’s education
industry has rightfully been established (STI Education Systems Holdings: About us, n.d.).
The report contains the necessary data summarized into statements of financial
position and performance of the year 2017, documenting important information like
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revenue, net income and the like, and shall encompass every company’s respective
assets, liabilities and equities. Being a detailed comparison of three (3) well established
institutions of higher learning, the report is to be done carefully and free from any form of
bias and questionable references. The analysis was constructed only within the confines
of factual, reliable information.
II. Objectives
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Below are the following objectives that this financial analysis aims to fulfill:
● To provide the readers a comparison and analysis of the aforementioned subjects,
namely Centro Escolar University, Far Eastern University Inc. and STI System
Holdings Inc.
● To make accessible every relevant piece of information about the financial
position, performance and changes in each company, as so to guide one in making
the proper and necessary economic decisions for them.
● To assess the past performance, current position, and operational efficiency of the
management of a company.
III. Comparative Financial Statements
Below are the financial statements of Centro Escolar University, FEU Incorporated,
and STI Education Systems Holdings, Inc.
A. Statement of Financial Position as of March 31, 2017
CEU
FEU
STI
ASSETS
Current Assets
Cash
₱435,796,757
₱1,526,000,000
₱3,204,000,000
Receivables
₱87,039,659
₱526,000,000
₱443,000,000
Commented [1]: http://quote.morningstar.com/stock-
filing/Annual-
Report/2017/3/31/t.aspx?t=XPHS:CEU&ft=&d=596ccdb
3ace8d1e3f2e74659008abdf9
Commented [2]: http://quotes.wsj.com/PH/XPHS/STI/fi
nancials/annual/balance-sheet
Other Current Assets
₱10,621,088
₱2,432,000,000
₱144,000,000
Property, Plant & Equipment
₱6,876,000,000
Financial Investments
₱47,605,695
₱956,000,000
₱3,039,000,000
Other non-current assets
₱30,343,434
₱293,000,000
₱430,000,000
Long-term notes receivable
LIABILITIES