INTERCO - is the same as in year ending Feb 29 1988...

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INTERCO ($000,000 except share price) The following is supporting analysis for Exhibit 12. EXHIBIT 12 CASH FLOW PROJECTIONS ($000,000) Sales growth rate 7.2% Tax rate 41% 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1. Sales 3,582 3,840 4,116 4,413 4,730 5,071 5,436 5,828 6,247 6,697 2. Operating margin 9.20% 9.30% 9.40% 9.50% 9.60% 9.70% 9.80% 9.90% 10.00% 10.10% 3. Operating earnings (1x2) 330 357 387 419 454 492 533 577 625 676 Plus: other income 29 29 29 29 29 29 29 29 29 29 Less: corporate expense 43 43 43 43 43 43 43 43 43 43 4. EBIT 316 343 373 406 440 478 519 563 611 663 5. Taxes 129 140 153 166 180 195 212 230 250 271 6. Net income 187 203 221 240 260 283 307 333 361 392 7. Change in NWC - - - - - 40 42 45 49 52 8. Cash flow (6-7) 187 203 221 240 260 243 265 288 313 340 Note: The tax rate is the same as in first quarter 1988. Other income and corporate expense
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Unformatted text preview: is the same as in year ending Feb. 29, 1988. Corporate expense was inferred from Exhibit 8, using interest expense and other income data from Exhibit 7. The following compares historical operating results to the projections. HISTORICAL PROJECTED 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 Net sales 2,832 2,947 3,341 Operating earnings 252 264 301 Operating margin 8.9% 9.0% 9.0% Curent assets 1,216 1,287 1,359 Current liabilities 250 358 373 Net working capital 966 928 986 NWC as % of sales 34% 32% 30% Cash 17 17 21 Marketable securities 127 64 11 NWC less cash and securities 822 848 954 Adjusted NWC as % of sales 29% 29% 29% Sales growth rate 4.0% 13.4% Net property plant and equipment 442 485 479 Change (=investment less depreciation) 43 (6)- - - - - - - - - -...
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