Business overseas contributes to 40% of the companys revenues, while the other 60% comes mainly from works done in the domestic market.
The COVID-19 pandemic has caused a slowdown in overall operations leading to prolonged delays in delivery of raw materials from abroad. The CEO of the company is optimistic that there will be a turnaround in operations in 2021, and is therefore considering contracting a loan of $500.0 Million from its local bank to help rebuild its lead position in the market and to expand its line of business to include the sales of heavy equipment. The company has over the years relied mainly on issuing long-term bonds to finance its capital projects. As of today, the firm has 50.0 million shares of common stock outstanding. You are hired as the Chief Financial Controller of the company to advise the CEO and board of the company of the current financial health of the company and to assist them in determining whether they would be successful with the new loan.
You began by gathering the following financial statements and other data about the firm.
2020 2012 10 60 130 220 580 800 40 110 710 140 $ 1 Balance Sheet Moms del 2091 Assets Est 2019 2030 Cash and Cash 15 10 15 Equivalents Accounts 60 Short Term 10 Investments 110 Accounts Receivable 120 375 315 140 Inventaries 200 415 Total Current Liabilities 490 130 Total Current Asset 1,145 1000 810 Long Term Bonds and New 2300 254 Net Plant and 1.190 Equipment 870 Total Dube 27301061.00 Preferred Stock 40 40 Common Sack 180 3:30 Retained 100 956 Total Common Equity 106 $ $ $ Total Assets Total Liabilities and $ $ 3,029 2,190 1,680 uity 2009 2110 Est. Estimate BnB Construction Inc. Income Statement (Millions of Dollar 2021 Est 2020 2019 Net Sales 3.000 2.850 Operating costs 3.300 2.100 ITD 900.00 700 750 Depreciation 110 Amortiston o Depreciation and Amortization 110 10 EBITO 790 HO Interest 300 60 Carnings Before Taxes 690 $32 600 Tawes (40%) 275 2003 240 Net Income Before preferred Dividende 414 MO Preferred Dividends 4 Net Income 5 4100 $ 203.2 5 3560 Common Dividends 575 S75 53 Addition to retained Earnings 5 35250 524505 303.0 2.100 Per Share Date Common Stock Price 2023 $ 2020 20$ 2019 23.305 26.00 79 7777 Earnings Per Share (EPS) Dividend Per Share DPS Book Value Per Share BVPS Cash Flow Per Share 5 5 5 5.063 1255 21.72 8.065 16.30 2.32 Required: As the newly appointed Chief Financial Officer of Bne Construction in write a report of ne more than three praes.font site 12. Times New Roman, 15 insan (excluding the reference page) to the board which discusses whether the company is to be successful if it approaches its bank Republic Limited for a loan to undertake the expansion project at a cost of $500.0 million. Your discussion should include sticlaysis of the current financial position and recent financial performance of the company liquidity, profitability, leverage, asset management, market value- 2 to 3 ratios for each category. The report should comment on whether the firm has a great chance of success with the loan or whether alternative forms of financing should be sought. Give justification for your answer. 2020 2012 10 60 130 220 580 800 40 110 710 140 $ 1 Balance Sheet Moms del 2091 Assets Est 2019 2030 Cash and Cash 15 10 15 Equivalents Accounts 60 Short Term 10 Investments 110 Accounts Receivable 120 375 315 140 Inventaries 200 415 Total Current Liabilities 490 130 Total Current Asset 1,145 1000 810 Long Term Bonds and New 2300 254 Net Plant and 1.190 Equipment 870 Total Dube 27301061.00 Preferred Stock 40 40 Common Sack 180 3:30 Retained 100 956 Total Common Equity 106 $ $ $ Total Assets Total Liabilities and $ $ 3,029 2,190 1,680 uity 2009 2110 Est. Estimate BnB Construction Inc. Income Statement (Millions of Dollar 2021 Est 2020 2019 Net Sales 3.000 2.850 Operating costs 3.300 2.100 ITD 900.00 700 750 Depreciation 110 Amortiston o Depreciation and Amortization 110 10 EBITO 790 HO Interest 300 60 Carnings Before Taxes 690 $32 600 Tawes (40%) 275 2003 240 Net Income Before preferred Dividende 414 MO Preferred Dividends 4 Net Income 5 4100 $ 203.2 5 3560 Common Dividends 575 S75 53 Addition to retained Earnings 5 35250 524505 303.0 2.100 Per Share Date Common Stock Price 2023 $ 2020 20$ 2019 23.305 26.00 79 7777 Earnings Per Share (EPS) Dividend Per Share DPS Book Value Per Share BVPS Cash Flow Per Share 5 5 5 5.063 1255 21.72 8.065 16.30 2.32 Required: As the newly appointed Chief Financial Officer of Bne Construction in write a report of ne more than three praes.font site 12. Times New Roman, 15 insan (excluding the reference page) to the board which discusses whether the company is to be successful if it approaches its bank Republic Limited for a loan to undertake the expansion project at a cost of $500.0 million. Your discussion should include sticlaysis of the current financial position and recent financial performance of the company liquidity, profitability, leverage, asset management, market value- 2 to 3 ratios for each category. The report should comment on whether the firm has a great chance of success with the loan or whether alternative forms of financing should be sought. Give justification for your
