Stock is up by +115% on last year, but a 20% rise in sales due to new machinery speeding up production is expected and planned for. The high levels of finished stock need to be available for immediate delivery with a +7 rise in orders on last year. Maintenance and cleaning is up by +135% on last year, with the increase in large machinery, this will be an expense that will have to factored in to ensure smooth production. Overall net profit is down, but machinery is a long term investment and will decrease in expense and generate profit in the next few years. Question 2 (A) The balance sheet will indicate the financial position of a business at any one point of time.
The operating margin which indicates how much a company makes (before taxes and interest) on sales is a good indicator of the quality of the company. Home Depot showed an increase from 1997 to 1999 then a decrease and stabilization in 2000 and 2001. Lowes showed a steady increase indicating that Lowes was earning more dollars per sales across the 5 year period and was performing better than Home Depot. The NOPAT margin fluctuated for Home Depot showing changes in the firm operating efficiencies. Lowes showed a steady increase indicating operating efficiencies
Our current valuation shows Cooper Industries can continue to be competitive in its acquisition of Nicholson File while maintaining a satisfactory return on investment. FORECASTED INCOMES To establish a forecast for Nicholson File, assumptions were made in regards to costs, growth, and revenue. Financial statements for the past 5 years were analyzed to produce average percentage growth of sales revenue. To identify a high and low maximum share value, two sets of assumptions were made. A conservative model representing current company growth, based on a current calculated growth rate of 3.39%, used a forecasted Cost of Goods Sold (CGS) and Selling, General, Administrative (SGA) of 65.58% and 22.01% of sales respectively (See Exhibit 1a).
As the economy bounced back, so did Costco and its bottom line. The charts below show Costco’s consistent increase in all ratios and revenues over the past four years. Selected Income Statement Data(In Millions) | 2011 | 2010 | 2009 | 2008 | Total Revenue | 88,915 | 77,946 | 71,422 | 72,483 | Operating Income | 2,439 | 2,077 | 1,777 | 1,969 | Net Income | 1,462 | 1,303 | 1,086 | 1,283 | Diluted Net Income per Share | 3.30 | 2.92 | 2.47 | 2.89 | First thing I want to point out is the Diluted EPS (Net income per share), as you can see, the Diluted EPS follows suit of the other 3 ratios. I included Diluted EPS because it is a better indication than EPS because it shows what their EPS would be if all employee’s turned in their stock
The pro forma financial statements are based on the current business that my father owns, supply costs and other companies’ information, although most of this information on the pro forma statements will come from the expected growth of the industry within the following three years. According to IBISWorld.com, the landscaping industry is on its way up and within the next three years, revenue growth is expected to climb anywhere from 5.8% - 8.5%. As an up and coming industry, I believe that as a company we can increase our sales by at least 20% every year through effective marketing and advertisements. 341647.5 11.3 Pro Forma Income Statements Income Statement | | | | | Dec 14 | Dec 15 | Dec 16 | Net Sales | 194,700 | 295,500 | 324,000 | Cost of Sales | 145,494 | 228,480 | 268,800 | Gross Profit | 49,206 | 67,020 | 55,200 | Operating expenses | | | | General | 2,819 | 6,000 | 10,000 | Depreciation | 2,000 | 2,000 | 2,000 | Operating Income | 44,387 | 59,020 | 43,200 | Other Income | 0 | 0 | 0 | Interest Income | 0 | 0 | 0 | Interest Expense | 900 | 900 | 900 | Other Income expenses | 0 | 0 | 0 | Income before taxes | 43,487 | 58,120 | 42,300
Long-term Smucker expected net sales to increase by six percent annually through 2-3 percent sales increases resulting from future acquisitions, and a one percent increase in sales resulting from new product introductions. Smucker spent between $50 million and $77 million annually between 2006 and 2009 to advertise its products. In
The company’s financial statements from the past three years are analyzed in great detail and net income and net cash flow projections are completed for the next five years to gain a sense of the capability of the organization to repay the pending revolving credit facility. Monro has several factors that support the issue of a new credit facility, including a strong balance sheet position, favorable industry trends and its market leading position. It is a low cost operator and has offered dividend increases for 11 years straight. Furthermore, it is the largest chain of under-car facilities in the U.S., offering a considerable variety of products and services, which balance and meet the needs of a broad clientele. *
At the same time, we can see that management’s decisions are effective in converting assets to profit through the results of their net return on assets. In the Ugly Shoe's example, we find the current ratio has risen from .8 to 2.5 in 2014. While anything over 2 is preferred, it is also important to look at such as the turnaround time for payment of current liabilities, time to collect on accounts receivables, and inventory turnover. We calculated the inventory turnover as part of the homework and it shows that inventory is turning over every 4.5 days that is an improvement from the 11.3 in 2011. This could be explained if they have moved to a just-in-time inventory process.
In this case the return on investment on $1 is $17.26 ($2078.57/$120.36). An additional client would bring about a revenue increase of $2078.5 and assuming profit of about 4.5 %, assuming an increase to 308 clients per planner Cost to the company: $72,962,232 Revenue generated in 1987 would be: $3,880,889,733 If only this alternative and increasing the sales force were to be used, an additional expenditure of about 72 million is to be undertaken, this is quite a formidable investment Number of sales per planner: According to exhibit 5 average accounts per
It grew faster than the overall market. However, when the indexes of S&P500 start increasing, its stock price decreases dramatically. From Exhibit 7 we can see that the KKD is operating better year by year. First, the ROA keep increase, although it fell from 10.33% to 8.16% in 2003, it still around 8%. That means every year the KKD has earnings from each dollar invested in.