Week 1 Chapter 3 Toolkit

Week 1 Chapter 3 Toolkit - A 1 2 3 4 5 6 7 8 9 10 11 12 13...

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4/11/2010 Chapter 3. Tool Kit for Analysis of Financial Statements RATIO ANALYSIS (Section 3.1) Input Data: 2010 2009 Year-end common stock price $23.00 $26.00 Year-end shares outstanding (in mil ions) 50 50 Tax rate 40% 40% After-tax cost of capital 11.0% 10.8% Lease payments $28 $28 Required sinking fund payments $20 $20 Balance Sheets (in mil ions of dol ars) Assets 2010 2009 Cash and equivalents $10 $15 Short-term investments $0 $65 Accounts receivable $375 $315 Inventories $615 $415 Total cur ent assets $1,000 $810 Net plant and equipment $1,000 $870 Total assets $2,000 $1,680 Liabilities and equity Accounts payable $60 $30 Notes payable $110 $60 Accruals $140 $130 Total cur ent liabilities $310 $220 Long-term bonds $754 $580 Total liabilities $1,064 $800 Prefer ed stock (400,000 shares) $40 $40 Common stock (50,000,000 shares) $130 $130 Retained earnings $766 $710 Total common equity $896 $840 Total liabilities and equity $2,000 $1,680 Income Statements (in mil ions of dol ars) 2010 2009 Net sales $3,000.0 $2,850.0 Operating costs $2,616.2 $2,497.0 $383.8 $353.0 Depreciation $100.0 $90.0 Amortization $0.0 $0.0 Depreciation and amortization $100.0 $90.0 Earnings before interest and taxes (EBIT) $283.8 $263.0 Less interest $88.0 $60.0 Earnings before taxes (EBT) $195.8 $203.0 Taxes (40%) $78.3 $81.2 Net income before prefer ed dividends $117.5 $121.8 Prefer ed dividends $4.0 $4.0 Net income available to common stockholders $113.5 $117.8 Common dividends $57.5 $53.0 Addition to retained earnings $56.0 $64.8 Calculated Data: Operating Performance and Cash Flows 2010 2009 Net operating working capital (NOWC) $800.0 $585.0 Total operating capital $1,800.0 $1,455.0 Net Operating Profit After Taxes (NOPAT) $170.3 $157.8 Net Cash Flow (Net income + Depreciation) $213.5 $207.8 Operating Cash Flow (OCF) $270.3 $247.8 Free Cash Flow (FCF) ($174.7) N/A Calculated Data: Per-share Information
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This note was uploaded on 02/15/2012 for the course FI 500 taught by Professor Jason during the Spring '12 term at SPSU.

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