As a fixed income analyst at Blackstone, your managing director has asked you to complete the ratio analysis shown below for Outdoor Outfitters (00) and a comparable company ("the comp" American Outdoor Brands). Because their markets include year-round sports and hobbies, these companies are virtually non-seasonal Financial Statements for OO are provided below the incomplete ratio analysis. Use the financial statements to fill in the missing ratios. Use the ratio analysis to answer the remaining questions based on these companies. OutdoorOutfitters oo Ratio Analysis for Q1 Ending: 3/31/20X1 Q3 22 Q1 TTM Q8 Q7 Q6 Q5 04 300.000 150.000 308.985 154.104 320.502 157.289 327.651 163.291 335.092 169.742 348.399 176.479 361.920 183.285 369.915 1,415,326 189.232 718.738 Sales (SMM) Comps Sales Sales Growth (Qon Q except TTM) Comps Sales Growth 3.00% 2.74% 3.73% 2.07% 2.23% 3.82% 2.27% 3.95% 3.97% 3.97% 3.88% 3.88% 2.21% 3.2496 12.58% 15.06% Profit Margin Comps Profit Margin 4.73% 13.50% 4.78% 13.86% 4.73% 13,38% 4.26% 14.11% 4.27% 14.63% 4.97% 14.68% 5.24% % 14.81% 4.77% 15.38% 1 14.88% COGS Margin=COGS/Sales (%) Comps COGS Margin 30.00% 33.33% 29.74% 33.34% 29.53% 33.71% 29.85% 33.33% 30.07% 32.77% 29.87% 32.65% 29.90% 32.36% 30.24% 32.58% 30.02% 32.58% Tax Rate = Tax Expense/EBT (%) Comps Tax Rate 32.42% 32.03% 31,65% 30.99% 34.9696 30.58% 34.85% 30.05% 30.70% 31.35% 32.99% 33.15% 33.64% 34.51% 31.47% 32 20% 32.31% 32.84% 0.82 Asset Efficiency Ratio = Sales/Assets(bop) Comps AER 0.83 0.63 0.83 0.63 0.84 0.82 0.64 0.83 0.64 0.84 0.65 0.83 0.86 0.86 0.67 Return on Assets (ROA) Comps ROA 3.92% 8.8196 3.93% 8.41% 3.53% 8 90% 3.49% 9.32% 4.11% 9,45% 4.4096 9.6796 3.96% 10.11% 4.16% 10.04% Return on Equity (ROE) Comps ROE 98.03% 21.35% 93.76% 20.39% 78 65% 21.23% 66.64% 22.02% 95.14% 22.43% 118 28% 23 32% 2 24 28% 79.42% 23.72% Accounts Receivable Turnover (AR-T) Comps AR-T 0.83% 3.33% 0.83% 3.37% 0.82% 3.41% 0.83% 3.38% 0.84% 3.36% 0 83% 3.33% 0.82% 3.27% 0.82% 3.28% 3 3.45% AP-T - AP(eopYCOGS % Comps AP-T 5.56% 5.00% 5.5896 4.98% 5.56% 5.01% 5 51% 5.06% 5.48% 5.09% 5 49% 5.07% 5.49% 5.03% 5.47% 4.95% 5.76% 5.21% Debt to Capital (DTC) Comps DIC 95.59% 56.04% 95.37% 56.0396 95.06% 55 32% 94.22% 54.91% 95.23% 55.11% 95 89% 55 81% 94.77% 55 64% 4 55 38% 95.15% % 55 38% Debt to EBIT (DIEBIT) Comps DEBIT 5.42 3.19 5.37 3.18 503 5 22 3 27 5.41 312 5.56 2.98 5.22 2.91 5 2.80 5.51 3.00 2.82 SOIC (SGA - Deprec * InterestyCOGS Comps SDIC 1 99 1.30 2.02 1.30 2.03 130 2.02 120 201 1130 1.99 120 1.97 1.29 197 12 1.98 CR - Current Assets/current Labies Comps CR 2414 4.57 410 4.54 4.57 2.50 4.58 4.65 4.50 4.55 4.55 WCR-WC Assets/WC Linbeities Comps WCR 7.50 18.00 7.54 10.02 7.54 16.09 7.57 10.11 7.54 10.10 7.49 18.01 7.50 15.97 7.53 18.11 7.53 16.11 Fred Coverage Ratio - EBIT/Interest Comps FOR 1.84 3.92 1.53 3.97 1.55 3.82 1.50 3.69 1:40 4.17 1.56 4.30 1.80 4.47 1.53 4.50 1.54 4.37 EBITDA-S - EBITDA/(Interest. CAPX) Comps EBITDA-S 1.07 1.41 0.97 1.13 0.96 1.11 0.92 1.22 0.95 1.20 1.00 1.27 0.04 1.28 0.97 1.21 0.96 1.25 12.59% Interest Rate - INT/Total Debt (bop) Comps Interest Rate 12.48% 8.16% 12.65% 8.17% 12.68% 8.22% 12.78% 8.30% 12.68% 8.13% 12.72% 8.15% 13.33% 8.62% 8.27% Q5 Balance Sheet ($MM UON) Assets Cash Accounts Receivable Short-Term Investments Inventory Other Current Assets Total Current Assets Net PPE Other Long Term Assets Total Assets 00 Q8 Q7 06 Q4 Q3 Q2 Q1 TTM 200.000 207.119 211.622 218.749 223.719 229,668 237.694 248.367 248.387 10.000 10.216 10.539 10.894 11.226 11.525 11.864 12.167 12.167 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 80.000 83.047 86.246 88.545 91.006 93.359 95.568 98.302 98.302 10.000 10.297 10.545 10.816 11.086 11.462 11.769 12.081 12.081 300.000 310.679 318.952 329.004 337.038 346,013 356,895 368.917 368.917 1.000.000 1.026.747 1.056.499 1,093,352 1.124.077 1,149.077 1,189.988 1.222.198 1 222.198 200.000 204.662 209.952 217 378 224.048 229.490 238.788 246.072 246.072 1,500.000 1.542.088 1,585.403 1,639.734 1,685.163 1,724.580 1,783.669 1,837.187 1,837.187 TTM Liabilities Accounts Payable Short-Term Debt Other Current Liabilities Total Current Liabilities Long-Term Debt Other Liabilities Total Liabilities Q8 Q7 Q6 Q5 04 Q3 Q2 Q1 20 000 20.498 21.041 21.541 22.099 22.882 23.748 24.479 100.000 103.222 106.816 110.980 114.900 119.491 122.397 127.196 20.000 20.733 21.286 21.908 22.591 23.325 23.842 24.529 140.000 144.453 149.143 154.429 159.589 165.678 169.987 176 204 1.200.000 1.229.256 1.259.271 1.289.614 1.338.832 1,377.137 1.407.824 1.456.292 100.000 103.719 105 924 109.749 113.913 117.611 121.420 124.038 1,440.000 1.477.427 1,514,339 1.553.792 1.612.335 1,660,426 1,699.231 1.756.533 24.479 127.196 24 529 178.204 1,456.292 124.038 1,758,533 Q8 60 000 Q7 64.661 Q6 71.064 Q5 85.942 Q4 72.828 Q3 64.154 Q2 84.438 Q1 80.654 TTM 80 654 Shareholder's Equity Equity - A-L Check Equity (BOP) +NI+PIC-DIV - Equity (EOP) NA 14.193 60.000 60.000 4.661 64 661 64 661 6.403 71.064 71.064 14.878 85 942 85.942 -13.114 72 828 72 828 -8.673 64 154 64.154 20.284 84.438 84.438 -3.784 80.654 84.438 -3.784 80 654 Total Liabilities Shareholder's Equity Check: Total Assets 1,500,000 1,542.088 1.585 403 1639.734 1685 163 1.724 580 1783.669 1,837 187 1,500,000 1,542.088 1.585.403 1,639.734 1.685.163 1.724.580 1.783.669 1.837.187 1.837.187 1.837.187 Income Statement (SMM UON) Revenues COGS Depreciation SGA INT Other Expenses Income) Pretax Income Q8 300.000 90.000 100.000 40.000 39.0 10 000 21.000 07 308.985 91.900 103 412 41 211 40.555 10 387 21.515 06 320.502 94651 107477 42236 42 149 10 684 23305 Q5 327.651 97.788 110.501 43.556 43.295 11 063 21.440 04 335.092 100 772 113.064 44 449 44.733 11 415 20 459 Q3 348.399 104 066 115.475 45 589 45.768 11671 PS 851 Q2 361.920 108 200 118,672 47 025 47 455 11.988 12A 5.1 Q1 369.915 111 850 123.114 48.154 48.675 12 368 25 75 00 TTM 1,415.326 424 887 470 324 185.198 188,630 47 442 60.000 04.061 71.084 85.94272,828 64.154 84.438 80.654 80.654 Equity DAL Chock Equity (BOP) +NI+ PIC - DIV Equity (EOP) NA 14.193 60.000 60.000 4.661 64.661 64.601 8.403 71.004 71.064 14.878 85.842 85.942 -13.114 72.828 72.828 -8.673 64.154 64.154 20 284 84.438 84.438 -3.784 80.654 84.438 -3.784 80.854 Total Liabilities + Shareholder's Equity Check: Total Assets 1,500.000 1,542.088 1,585.403 1,639.734 1,685.163 1,724.580 1.783.809 1,837,187 1,837.187 1,500,000 1,642.088 1,585.403 1,639.734 1,885.163 1,724.580 1,783.000 1,837.1871,837.187 Income Statement (SMM UON) Revenues COGS Depreciation SGA INT Other Expenses (Income) Pretax Income Tax After Tax Expenses/(Income) Net Income Q8 300.000 90.000 100.000 40.000 39.0 10.000 21.000 6.807 0.000 14,193 Q7 308.984 91.900 103.417 41.211 40.555 10.387 21.515 6.810 0.000 14.705 Q8 320.502 94.651 107.477 42.236 42.149 10.684 23.305 8.148 0.000 15.156 05 327.651 97.788 110.501 43.556 43.295 11.063 21.448 7.475 0.000 13.973 04 335.092 100.772 113.064 44.449 44.733 11.415 20.659 6.341 0.000 14.318 Q3 348.399 104.066 115.475 45.569 45.788 11.671 25.851 8.528 0.000 17.323 02 361.920 108,200 118.672 47.025 47.455 11.988 28.581 9.613 0.000 18.968 Q1 369.915 111.850 123.114 48.154 48.675 12.368 25.754 8.105 0.000 17.649 OO TTM 1.415.328 424.887 470.324 185.198 188.830 47.442 100.845 32.587 0.000 68.257 Additions to Equity NI + Paid in Capital (PIC) - Dividends Delta Equity Check: Delta Equity from BS's 14.193 0.000 0.000 14.193 14.705 0.000 -10.044 4.661 4.661 15.156 0.000 -8.754 6.403 6.403 13.973 0.905 0.000 14,878 14.878 14,318 0.000 -27.432 -13.114 -13.114 17.323 0.000 -25.996 -8.673 8.673 18.968 1.316 0.000 20.284 20.284 17.649 0.000 -21.433 3.784 -3.784 68.257 1.316 -74.881 -5.287 -5.287 PPE Roll Forward Net PPE BOP + CAPX - Deprec = Net PPE EOP NA 1,000,000 1,026.747 1056.499 1,093.352 1.124.077 1,149.077 1,189.986 1,093.352 110.000 130.165 137.229.147.354 143.789 140.475 159.581 155.325 599.170 -100 000 . 103.417 -107 477 -110.501-113.064 -115.475 -118.672 -123. 114 470 324 1.000.000 1,026.747 1,056.499 1,093,352 1.124.077 1.149.077 1,189.986 1.222.198 1,222.198 Cash Flow Statement ($MM UON) Cash Flow (Ops) NI Dprec Other Operating Flows CF Ops Q8 14.193 100.000 4.161 118.353 07 14.705 103.417 3.850 121.972 Q6 15.156 107.477 1.609 124.242 Q5 13.973 110.501 5.114 129.588 Q4 14.318 113.064 1.295 128,677 Q3 17.323 115.475 4 963 137,761 Q2 18.968 118.672 6.849 144.489 Q1 17 649 123.114 1.599 142.362 oo TTM 68.257 470.324 14.707 553.288 Cash Flow (Inv) CAPX Other Investing Flows CF Inv 08 -110.000 0.000 -110.000 Q7 06 -130, 165 -137 229 0.000 0.000 -130,165 -137 229 Q5 -147.354 0.000 -147 354 Q4 143.789 0.000 143.789 Q3 -140 475 0.000 -140.475 Q2 - 159.581 0.000 -159.581 Q1 -155 325 0.000 -155 325 TTM -599 170 0.000 -599. 170 Cash Flow Fin) Dividends Paid in Capital (PIC) Other Financing Flows CF Fin Q8 0.000 0 000 0.000 0.000 07 -10.044 0.000 15.311 15.311 Q6 -8.754 0.000 -4 503 17.489 05 0.000 0 905 -7.127 24 892 Q4 -27.432 0.000 -4.971 20.083 Q3 -25.996 0.000 -5.949 8.663 Q2 0.000 1316 -8.026 23.118 Q1 -21.433 0.000 -8.673 21 636 TTM -74.861 1 316 -27 618 73 500 lo 12 15 Which company or companies can comfortably pay their interest obligations from the fruits of their day-to-day business operations? How do you justify your answer? Choose one or more companies and one justification. By guessing. Both companies By inspecting debt to capital ratios. By inspecting fixed coverage ratios. Just Oo Just the Comp By inspecting interest rates. By inspecting Debt to Ebit ratios. 13 15 What is Ratio 1? de 14 13 Which firm has the higher operating leverage? Pick one firm and the ratio you used to determine your answer. Fixed Coverage Ratio AR-T OO O SDItc The comp Debt to Ebit Debt to Capital 15 15 What is Ratio 2? 16 15 What is Ratio 3? 17 15 Looking forward for about a year, which company has the best liquidity? Which ratio did you use to determine this? Choose one company and one ratio. Debt to Capitalization Ratio Ebitda sustainability ratio Current Ratio 00 The Comp Fixed Coverage Ratio ( Interest Rate