Question
ABC is a publicly traded company listed on NASDAQ. In ABCs 10-Q and 10-K public statements, ABC disclosed that it recorded a $200 mil. pre-tax
ABC is a publicly traded company listed on NASDAQ. In ABCs 10-Q and 10-K public statements, ABC disclosed that it recorded a $200 mil. pre-tax inventory write-off due to fire in the companys warehouse in 2020:Q3; it realized a $30 mil. pre-tax gain (other income) on the sale of a non-core business in 2020:Q3; The company additionally realized a $50 mil. pre-tax gain (other income) on the sale of a non-core business and $45 mil. pre-tax restructuring costs in connection with a downsizing strategy in 2020:Q4. ABC company produced the following reported year-to-date (YTD) income statements during 2020-2021 period.
Reported YTD Income Statement (in mil. dollars) | |||
2020:Q3 | 2020:Q4 | 2021:Q3 | |
Sales | 3,500 | 4100 | 3600 |
COGS | 2,200 | 2925 | 3000 |
Other Income | 50 | 90 | 40 |
SG&A | 675 | 700 | 120 |
Restructuring Charge | 0 | 45 | 0 |
EBIT | 675 | 520 | 520 |
Interest Expense | 75 | 102 | 73 |
Pre-tax Income | 600 | 418 | 447 |
Income Tax (30%) | 180 | 125.4 | 134.1 |
Net Income | 420 | 293 | 313 |
ABC has 150 mil. basic outstanding shares, with current stock price of $32 per share. The company has the following information about the options/warrants:
Tranche | Number of Shares (mil.) | Exercise Price |
Tranche 1 | 15 | $ 5.00 |
Tranche 2 | 10 | $ 25.00 |
Tranche 3 | 20 | $ 30.00 |
Tranche 4 | 12 | $ 35.00 |
Tranche 5 | 11 | $ 47.00 |
Tranche 6 | 5 | $ 55.00 |
What is the amount of ABC's LTM Earnings per share (LTM EPS)?
A. | 1.34 | |
B. | 1.10 | |
C. | 2.12 | |
D. | 0.42 | |
E. | 0.88 |
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