1. Financial ratio analysis of Hershey as of 2001. Include the following categories:

a. Debt ratios: Debt/equity ratio, times interest earned

b. Profitability ratios: Gross profit margin, operating margin, net profit margin

c. Market ratios: ROE, ROA, P/E, Market/Book

(Please include excel formula)

Income Statement
($ millions)
	1996	1997	1998	1999	2000	2001
Sales	$ 3,989.3	$ 4,302.2	$ 4,435.6	$ 3,970.9	$ 4,221.0	$ 4,137.2
Cost of sales	2,302.1	2,488.9	2,625.1	2,354.7	2,471.2	2,668.5
Gross profit	1,687.2	1,813.3	1,810.6	1,616.2	1,749.8	1,468.7
Gross margin	42.29%	42.15%	40.82%	40.70%	41.46%	35.50%
Selling, marketing, and administrative	1,124.1	1,183.1	1,167.8	1,057.8	1,127.2	1,056.1
Operating income	563.1	630.2	642.8	558.4	622.7	412.6
Operating margin	14.12%	14.65%	14.49%	14.06%	14.75%	9.97%
Gain (loss) on sale of business	(35.4)	-	-	243.8	-	-
Earnings before interest and tax	527.8	630.2	642.8	802.1	622.7	412.6
Interest expense	48.0	76.3	85.7	74.3	76.0	69.1
Pretax income	479.7	554.0	557.1	727.9	546.6	343.5
Income taxes	206.6	217.7	216.1	267.6	212.1	136.4
Net income	$ 273.2	$ 336.3	$ 341.0	$ 460.3	$ 334.5	$ 207.1
Balance Sheet
	1996	1997	1998	1999	2000	2001
Cash and cash equivalents	$ 61.4	$ 54.2	$ 39.0	$ 118.1	$ 32.0	$ 134.1
Accounts receivable trade	294.6	360.8	451.3	352.8	379.7	361.7
Inventories	475.0	505.5	493.2	602.2	605.2	512.1
Other current assets	155.2	114.2	150.4	207.0	278.5	159.5
Total current assets	986.2	1,034.8	1,134.0	1,280.0	1,295.3	1,167.5
Property, plant, and equipment, net	1,601.9	1,648.2	1,648.1	1,510.5	1,585.4	1,534.9
Goodwill	566.0	551.8	530.5	450.2	474.4	388.7
Other tangible assets	30.7	56.3	91.6	106.0	92.6	156.3
Total assets	$ 3,184.8	$ 3,291.2	$ 3,404.1	$ 3,346.7	$ 3,447.8	$ 3,247.4
Accounts payable	$ 134.2	$ 146.9	$ 156.9	$ 136.6	$ 149.2	$ 133.0
Accrued liabilities	368.1	391.2	311.9	364.7	359.5	465.5
Short-term debt	315.0	257.5	346.0	211.6	258.1	7.9
Total current liabilities	817.3	795.7	814.8	712.8	766.9	606.4
Long-term debt	655.3	1,029.1	879.1	878.2	877.7	877.0
Other long-term liabilities	327.2	346.5	346.8	330.9	327.7	361.0
Deferred income taxes	224.0	267.1	321.1	326.0	300.5	255.8
Total liabilities	2,023.8	2,438.4	2,361.8	2,248.0	2,272.7	2,100.2
Stockholders' equity	1,161.0	852.8	1,042.3	1,098.6	1,175.0	1,147.2
Total liabilities and equity	$ 3,184.8	$ 3,291.2	$ 3,404.1	$ 3,346.7	$ 3,447.8	$ 3,247.4