FINC3009 Chapter 2: Walmart Stores Financial Statement Analysis 2.3 The Income Statement Criteria: Balance Sheet (assets, liabilities & stockholders' equity) Annual Data | Millions of US $ except per share data Cash On Hand Receivables Inventory Pre-Paid Expenses Other Current Assets Total Current Assets Property, Plant, And Equipment Long-Term Investments Goodwill And Intangible Assets Other Long-Term Assets Total Long-Term Assets Total Assets Total Current Liabilities Long Term Debt Other Non-Current Liabilities Total Long Term Liabilities Total Liabilities Common Stock Net Retained Earnings (Accumulated Deficit) Comprehensive Income Other Share Holders Equity Share Holder Equity Total Liabilities And Share Holders Equity 3 3 3 3 EE EEEEE EEEEEE EE 2022-01-31 2021-01-31 $14,760 $8,280 $56,511 $17,741 $6,516 $44,949 $1,519 $20,861 Annual Data | Millions of US $ except per share data Revenue Cost Of Goods Sold Gross Profit Research And Development Expenses EEE 2022-01-31 2021-01-31 $572,754 $559,151 $429,000 $420,315 $143,754 $138,836 SG&A Expenses . $117,812 $116,288 Other Operating Income Or Expenses $81,070 $90,067 $94,515 $92,201 $29,014 $28,983 $22,152 $23,598 $163,790 $162,429 $244,860 $252,496 $87,379 $92,645 $39,107 $45,041 $65,590 $72,320 $152,969 $276 $86,904 $164,965 $282 $88,763 Operating Expenses Operating Income Total Non-Operating Income/Expense Pre-Tax Income Income Taxes Income After Taxes Other Income Income From Continuous Operations Income From Discontinued Operations Net Income EBITDA EBIT Basic Shares Outstanding Shares Outstanding Basic EPS $-8,766 $-11,766 $91,891 $244,860 $87,531 $252,496 3 3 3 3 3 3 EEEEEEEE $117,812 $116,288 $25,942 $22,548 S-7,246 $-1,984 $18,696 $20,564 $4,756 $6,858 $13,940 $13,706 $13,940 $13,706 $13,673 $13,510 $36,600 $33,700 $25,942 $22,548 2,792 2,831 2,805 2,847 $4.90 $4.77 WMT Cash Flow 2022 Annual Data | Millions of US $ except per share data 2022-01-31 Net Income/Loss Total Depreciation And Amortization - Cash Flow Other Non-Cash Items Total Non-Cash Items Change In Accounts Receivable Change In Inventories Change In Accounts Payable Change In Assets/Liabilities Total Change In Assets/Liabilities Cash Flow From Operating Activities Net Change In Property, Plant, And Equipment Net Change In Intangible Assets Net Acquisitions/Divestitures Net Change In Short-term Investments Net Change In Long-Term Investments Net Change In Investments - Total Investing Activities - Other Cash Flow From Investing Activities Net Long-Term Debt Net Current Debt EEE EEEEEEE 2021-01-31 $13,940 $13,706 $10,658 $11,152 $4,528 $1,723 $15,186 $12,875 $-1,796 $-1,086 $-11,764 $-2,395 $5,520 $6,966 $-6,597 $7,972 $24,181 $36,074 $-12,712 $-10,049 . $-359 $-180 Debt Issuance/Retirement Net - Total Net Common Equity Issued/Repurchased Net Total Equity Issued/Repurchased Total Common And Preferred Stock Dividends Paid Financial Activities - Other Cash Flow From Financial Activities Net Cash Flow EEEEEEEEEEEEE $7,056 $158 $-6,015 $-10,071 $-6,065 $-5,382 $193 $-324 $-5,872 $-5,706 $-6,548 $-2,485 $-6,548 $-2,485 $-6,576 $-6,550 $-3,832 $-1,376 $-22,828 $-16,117 $-2,954 $8,273 Stock-Based Compensation Common Stock Dividends Paid L. $-6,576 $-6,550 Financing Activity 1. Calculate the difference between WMT's net income and the amount it spends on dividends that is referred to as WMT retained earnings for 2022. a. Retained Earnings (2022) = Net Income - Dividends b. Payout Ratio (WMT 2022) = Dividends / Net Income b. Calculate Debt-to-Capital Ratio (WMT) = Total Debt (2022) / Total Equity (2022) + Total Debt (2022). c. Calculate Net Debt (WMT) = Total Debt (2022) - Excess Cash & Short-Term Investments (2022). c. Calculate WMT Change in Stockholders' Equity (2022) = Retained Earnings (2022) + Net Sales of Stock. (2022) d. What are the components of the statement of cash flow? d. Calculate Debt-to-Enterprise Value Ratio (WMT) = Net Debt (2022)/ Enterprise Value (2022). e. Calculate Return on Equity (WMT) = Net Income (2022)/ Book Value of Equity (2022). f. Calculate the Return on Assets (ROA) = (Net Income (2022) + Interest Expense (2022))/ Total Assets (2022). 2. Profitability Ratios a. Calculate Gross Margin (WMT 2022) = Gross Profit (WMT 2022)/Sales (WMT 2022). b. Calculate Operating Margin (WMT 2022) = Operating Income / Sales (WMT 2022). g. Calculate Return on Invested Capital (ROIC) (WMT) = EBIT(1-Tax Rate) / Book Value of Equity (2022) + Net Debt (2022). c. Calculate Net Profit Margin = Net Income / Sales. What does net profit margin shows? 3. Liquidity Ratios a. Calculate Current Ratio (WMT 2022) = Current Assets (2022)/ Current Liabilities (2022) b. Calculate Quick Ratio (WMT) = Current Assets (2022) - Inventory (2022)/Current Liabilities (2022). 6. A. B. h. Calculate the DuPont Identity (WMT) = ROE = Net Income (2022) / Total Equity (2022). What is the Sarbanes-Oxley Act? (50 words - 100 words) words) Describe the transaction Enron used to increase its reported earnings. (50 words - 100 c. Calculate Cash Ratio (WMT) = Cash (2022) / Current Liabilities (2022). 4. Asset Efficiency a. Calculate Asset Turnover (WMT) = Sales (2022) / Total Assets (2022). b. Calculate Fixed Asset Turnover (WMT) = Sales (2022) / Fixed Assets (2022) 5. Leverage Ratios a. Calculate Debt-Equity Ratio (WMT) = Total Debt (2022) / Total Equity (2022)