52 Part 1 Introduction (All data as of fiscal year end; Sin millions) 2013 2014 2015 2016 179 6.4 242 5000 5242 250.1 7743 220 7.0 29.0 575.0 604.0 251.0 855.0 26.8 8.1 34.9 600.0 634.9 2583 893.3 31.7 9.7 41.4 600.0 6414 2735 914.9 2013 2014 6.2 34.3 2015 12.7 38.4 2016 21.7 38.6 2.9 27.0 (7.2) (9.1) 18.8 (0.0) Mydeco Corp. 2012-2016 Balance Sheet continued) 2012 Liabilities & Stockholders' Equity Accounts Payable 18.7 Accrued Compensation 6.7 Total Current Liabilities 25.5 Long-Term Debt 500.0 Total Liabilities 5255 Stockholders' Equity 2526 Total Liabilities & Stock 778.1 holders' Equity Statement of Cash Flows 2012 Net Income 18.0 Depreciation & 27.3 Amortization Change in Accounts 3.9 Receivable Change in Inventory (2.9) Change in Payables & 22 Accrued Compensation Cash from Operations 48.4 Capital Expenditures (25.0) Cash from Investing (250) Activities Dividends Paid 15.4 Sale for purchase of Stock Debt Issuance (Pay Down) Cash from Financing (5.4) Activities Change in Cash 18.0 Mydeco Stock Price $7.90 2.9 (1.3) 2.5 4.8 (3.3) 5.9 (3.6) 65 50.4 (25.0) (250) 47.8 (100.0) (1000) 46.6 (75.0) (75,0) 54.0 (40.0) (40.0) (5.4) (5.4) (5.4) (6.5) - 750 69.6 25.0 19.6 (5.4) (6.5) 17.4 20.0 $3.29 (8.8) $8.70 7.5 $10.87 $5.23 9. See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. a. By what percentage did Mydeco's revenues grow each year from 2013-2016? b. By what percentage did net income grow each year? c. Why might the growth rates of revenues and net income differ? 10. See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco repurchases 2 million shares each year from 2013-2016. What would its earnings per share be in 2016? 11. See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco had purchased additional equipment for $12 million at the end of 2013, and this equipment was depreciated by S4 million per year in 2014, 2015, and 2016. Given Mydeco's tax rate of 35%, what impact would this additional purchase have had on Mydeco's net income in years 2013-2016? 1 12. See Table 2,5 showing financial statement data and stock price data for Mydeco Corp Suppose Mydeco's costs and expenses had been the same fraction of revenues in 2013-2016 as they were in 2012. What would Mydeco's EPS have been each year in this case? (5.4) (5.4) (6.5) (5.4) (5.4) Activities Dividends Paid Sale (or Purchase) of Stock Debt Issuance (Pay Down) Cash from Financing Activities Change in Cash Mydeco Stock Price 75.0 69.6 25.0 19.6 (6.5) (5.4) (5.4) 18.0 $7.90 20.0 $3.29 17.4 $5.23 (8.8) $8.70 7.5 $10.87 9. See Table 2.5 showing financial statement data and stock price data for Mydeco Co a. By what percentage did Mydeco's revenues grow each year from 2013-2016? b. By what percentage did net income grow each year? c. Why might the growth rates of revenues and net income differ? 1 Introduction 2016 (All data as of fiscal year end; $ in millions) 2013 2014 2015 17.9 6.4 24.2 500.0 524.2 250.1 774.3 22.0 7.0 29.0 575.0 604.0 251.0 855.0 26.8 8.1 34.9 600.0 634.9 258.3 893.3 31.7 9.7 41.4 600.0 641.4 273.5 914.9 2013 2.9 27.0 2014 6.2 34.3 2015 12.7 38.4 2016 21.7 38.6 18.8 (0.0) (7.2) (9.1) Mydeco Corp. 2012-2016 2012 Balance Sheet (continued) Liabilities & Stockholders' Equity Accounts Payable 18.7 6.7 Accrued Compensation Total Current Liabilities 25.5 Long-Term Debt 500.0 Total Liabilities 525.5 Stockholders' Equity 252.6 Total Liabilities & Stock 778.1 holders' Equity Statement of Cash Flows 2012 Net Income 18.0 Depreciation & 27.3 Amortization Change in Accounts 3.9 Receivable Change in Inventory (2.9) Change in Payables & 2.2 Accrued Compensation Cash from Operations 48.4 Capital Expenditures (25.0) Cash from Investing (25.0) Activities Dividends Paid (5.4) Sale (or Purchase) of Stock Debt Issuance (Pay Down) Cash from Financing (5.4) Activities Change in Cash Mydeco Stock Price 2.9 (1.3) 2.5 4.8 (3.3) 5.9 (3.6) 6.5 50.4 (25.0) (25.0) 47.8 (100.0) (100.0) 46.6 (75.) (75.0) 54.0 (40.0) (40.0) (5.4) (5.4) (5.4) (6.5) 1 75.0 69.6 (5.4) 25.0 19.6 (6.5) 18.0 $7.90 20.0 $3.29 17.4 $5.23 (8.8) $8.70 7.5 $10.87 2016 2012 404.3 (188.3) 215.9 (66.7) (60.6) (27.3) (All data as of fiscal year end; $ in millions) 2013 2014 2015 363.8 424.6 510.7 (173.8) (206.2) (246.8) 190.0 218.3 263.9 (66.4) (82.8) (102.1) (59.1) (59.4) (66.4) (27.0) (34.3) (38.4) 604.1 (293.4) 310.7 (120.8) (78.5) (38.6) 41.8 Mydeco Corp. 2012-2016 Income Statement Revenue Cost of Goods Sold Gross Profit Sales and Marketing Administration Depreciation & Amortization EBIT Interest Income (Expense) Pretax Income Income Tax Net Income Shares Outstanding (millions) Earnings per Share Balance Sheet Assets Cash Accounts Receivable Inventory Total Current Assets Net Property, Plant, & Equipment Goodwill & Intangibles Total Assets 61.3 (33.7) 27.7 (9.7) 18.0 55.0 37.4 (32.9) 4.5 (1.6) 2.9 55.0 (32.2) 9.6 (3.4) 6.2 55.0 57.0 (37.4) 19.6 (6.9) 12.7 55.0 72.8 (39.4) 33.4 (11.7) 21.7 55.0 $0.33 2012 $0.05 2013 $0.11 2014 $0.23 2015 $0.39 2016 68.8 48.8 88.6 33.7 171.1 245.3 69.8 30.9 86.2 69.8 28.4 77.4 76.9 31.7 186.1 345.5 84.9 86.1 35.3 206.3 347.0 169.4 243.2 184.4 308.9 361.7 361.7 778.1 361.7 855.0 361.7 893.3 361.7 914.9 774.3 (Continued)