Given:

Determine:

MARS, INCORPORATED Wrigley Selected Financial Data (all numbers, except per share numbers, in millions of dollars) Operating Data Revenues Gross profit Income taxes Net earnings Per share of common stock (diluted) Dividends paid Per share of common stock As a percentage of net earnings Average shares outstanding 2003 3,069.09 1,792.35 205.65 445.89 1.59 2004 2005 2006 2007 3,648.59 4,159.31 4,686.01 5,389.10 2,038.61 2,255.90 2.429.82 2,840.78 227.54 237.41 239.67 300.16 492.95 517.25 529.38 632.01 1.75 1.83 1.90 2.28 0.69 44% 281,204 0.74 0.86 0.99 42% 47% 52% 280,796 280,964 277,556 1.13 49% 275,357 Other Financial Data Net property, plant and equipment Total assets Working capital Debt Stockholders' equity Return on average equity Stockholders of record at close of year Employees at close of year Sales per employee 2003 2004 2005 2006 2007 956.18 1.142.62 1,282.41 1,422.52 1,560.06 2,520.41 3,166.70 4,460.20 4,661.60 5.231.51 825.80 787.94 325.28 454.10 448.66 0.00 90.00 1,100.00 1,065.00 1,000.00 1,820.82 2,178.68 2,214.42 2,388.09 2,817.48 24% 23% 23% 22% 22% 40,379 40,779 40,545 40,986 41,020 12,000 14,800 14,300 15,800 16,400 0.26 0.25 0.29 0.30 0.33 Exhibit 10 MARS, INCORPORATED Confectionery Industry at the Beginning of 2008 (in millions of dollars) Revenues Net Income EBIT LT Debt Cadbury plc Kraft Foods Inc. Lance, Inc. The Hershey Company Tootsie Roll Industries, Inc. Wm. Wrigley Jr. Company General Mills, Inc. Mars, Incorporated 2,383 10.600 50 1.280 Operating Margin 13.2% 16.5% 9.0% 24.0% 20.0% 17.9% 20.8% 15,855 37,000 765 4,947 493 5,389 11,640 25,000 1,567 2,850 25 480 55 632 1,144 n'a 2.088.00 6,105.00 68.85 1.187.28 98.60 964.65 2.421.12 n'a Current Assets 5,171 9,544 142 1,427 233 1.579 3,844 n/a Current Liabilities 9.178 10.194 77 1,619 77 1,189 6.223 n/a Employees 36,460 90,000 4,800 12.800 1,950 16,400 28,500 48,000 1.000 3,599 n'a n'a PE Ratio Beta Dividend Yield Tax Rate 2.1% 30.0% Cadbury plc Kraft Foods Inc. Lance, Inc. The Hershey Company Tootsie Roll Industries, Inc. Wm. Wrigley Jr. Company General Mills, Inc. Market Cap Shares 26,046 2.109.000.000 46,230 1.547,200,000 594 31,204.418 8,144 227.049,657 1,368 54.941,131 15.899 275.742,319 17.761 336,000,000 Stock Price 12.35 29.88 19.05 35.87 24.90 57.66 52.86 16.6 16.2 23.8 17.0 24.9 25.2 15.5 Bond Rating n'a n/a A A 0.95 0.75 0.90 0.70 0.85 0.70 0.65 3.6% 3.4% 3.3% 1.3% 2.2% 3.1% 35.5% 37.0% 36.0% 33.0% 32.0% 34.3% MARS, INCORPORATED Financial Forecast for Wrigley, Stand-Alone Valuation (in millions of dollars) 2006 2007 200SF 2009F 2010F 2011F 2012F Sugar prices (dollar/tonne) Sugar (in millions of tonnes) 416 1.5948 288 2.6387 250 2.9266 254 3.0203 258 3.1008 263 3.1792 267 3.2717 Revenues by regions North America EMEAI Asia All other Revenues COGS Sugar Other Total COGS SG&A 1,822 2,153 648 63 4.686 1,823 2,726 777 63 5,389 2,011 3,080 876 72 6,039 2,096 3,472 965 79 6,613 2.183 3,882 1,061 90 7,215 2.265 4,357 1,168 103 7,893 2,353 4.879 1,287 117 8.635 761 1,775 2,535 1,891 732 2,047 2,779 2,114 767 2,278 3,045 2,315 800 2,515 3.315 2,525 836 2,795 3,631 2,755 874 3,098 3,971 3,005 Operating income NOPAT Depreciation CapEx Changes in NWC FCF 963 655 51 189 -5 1,147 780 193 325 134 514 1,253 852 156 340 -41 709 1,374 935 158 356 40 697 1,508 1,025 163 373 50 766 1,659 1,128 160 390 30 868 Net PPE Net PPE as percentage of sale NWC NWC as percentage of sales 1,423 30.4% 454.10 9.7% 1,560 28.9% 448.66 8.3% 1,692 28.0% 582.30 9.6% 1,876 28.4% 541.77 8.2% 2.074 28.7% 581.93 8.1% 2,284 28.9% 631.52 8.0% 2,513 29.1% 661.76 7.7% Tax rate 32% MARS, INCORPORATED Bonds Market Interest Rates, April 2008 Corporate bonds A Baa 5.55% 5.93% 6.30% 6.97% Data source: Mergent Bond Record, April 2008. Treasury bills 1-month 3-month 6-month 1-year 2-year 3-year 5-year 7-year 10-year 20-year 30-year 1.07% 1.31% 1.58% 1.74% 2.05% 2.23% 2.84% 3.19% 3.68% 4.40% 4.44% Data source: U.S. Treasury, Market Risk Premium 6% Step # 1: Estimate Wrigley's WACC. Step # 2: Estimate Wrigley's Free cash flow to the firm (FCFF) from 2008- 2012 (see Excel file sent to your group). Step # 3: Estimate Wrigley's Terminal Value (TV) in 2012: Prv - FCFF, * (1 + Quy) x discount factor (WACCTV-97v) Step # 4: Estimate Wrigley's Enterprise Value (EV), which of course include the Terminal Value (TV) Step #5: Estimate Wrigley's Equity (E) E = EV-Debt Step # 6: Estimate Wrigley's share price Po= E Number of Shares MARS, INCORPORATED Wrigley Selected Financial Data (all numbers, except per share numbers, in millions of dollars) Operating Data Revenues Gross profit Income taxes Net earnings Per share of common stock (diluted) Dividends paid Per share of common stock As a percentage of net earnings Average shares outstanding 2003 3,069.09 1,792.35 205.65 445.89 1.59 2004 2005 2006 2007 3,648.59 4,159.31 4,686.01 5,389.10 2,038.61 2,255.90 2.429.82 2,840.78 227.54 237.41 239.67 300.16 492.95 517.25 529.38 632.01 1.75 1.83 1.90 2.28 0.69 44% 281,204 0.74 0.86 0.99 42% 47% 52% 280,796 280,964 277,556 1.13 49% 275,357 Other Financial Data Net property, plant and equipment Total assets Working capital Debt Stockholders' equity Return on average equity Stockholders of record at close of year Employees at close of year Sales per employee 2003 2004 2005 2006 2007 956.18 1.142.62 1,282.41 1,422.52 1,560.06 2,520.41 3,166.70 4,460.20 4,661.60 5.231.51 825.80 787.94 325.28 454.10 448.66 0.00 90.00 1,100.00 1,065.00 1,000.00 1,820.82 2,178.68 2,214.42 2,388.09 2,817.48 24% 23% 23% 22% 22% 40,379 40,779 40,545 40,986 41,020 12,000 14,800 14,300 15,800 16,400 0.26 0.25 0.29 0.30 0.33 Exhibit 10 MARS, INCORPORATED Confectionery Industry at the Beginning of 2008 (in millions of dollars) Revenues Net Income EBIT LT Debt Cadbury plc Kraft Foods Inc. Lance, Inc. The Hershey Company Tootsie Roll Industries, Inc. Wm. Wrigley Jr. Company General Mills, Inc. Mars, Incorporated 2,383 10.600 50 1.280 Operating Margin 13.2% 16.5% 9.0% 24.0% 20.0% 17.9% 20.8% 15,855 37,000 765 4,947 493 5,389 11,640 25,000 1,567 2,850 25 480 55 632 1,144 n'a 2.088.00 6,105.00 68.85 1.187.28 98.60 964.65 2.421.12 n'a Current Assets 5,171 9,544 142 1,427 233 1.579 3,844 n/a Current Liabilities 9.178 10.194 77 1,619 77 1,189 6.223 n/a Employees 36,460 90,000 4,800 12.800 1,950 16,400 28,500 48,000 1.000 3,599 n'a n'a PE Ratio Beta Dividend Yield Tax Rate 2.1% 30.0% Cadbury plc Kraft Foods Inc. Lance, Inc. The Hershey Company Tootsie Roll Industries, Inc. Wm. Wrigley Jr. Company General Mills, Inc. Market Cap Shares 26,046 2.109.000.000 46,230 1.547,200,000 594 31,204.418 8,144 227.049,657 1,368 54.941,131 15.899 275.742,319 17.761 336,000,000 Stock Price 12.35 29.88 19.05 35.87 24.90 57.66 52.86 16.6 16.2 23.8 17.0 24.9 25.2 15.5 Bond Rating n'a n/a A A 0.95 0.75 0.90 0.70 0.85 0.70 0.65 3.6% 3.4% 3.3% 1.3% 2.2% 3.1% 35.5% 37.0% 36.0% 33.0% 32.0% 34.3% MARS, INCORPORATED Financial Forecast for Wrigley, Stand-Alone Valuation (in millions of dollars) 2006 2007 200SF 2009F 2010F 2011F 2012F Sugar prices (dollar/tonne) Sugar (in millions of tonnes) 416 1.5948 288 2.6387 250 2.9266 254 3.0203 258 3.1008 263 3.1792 267 3.2717 Revenues by regions North America EMEAI Asia All other Revenues COGS Sugar Other Total COGS SG&A 1,822 2,153 648 63 4.686 1,823 2,726 777 63 5,389 2,011 3,080 876 72 6,039 2,096 3,472 965 79 6,613 2.183 3,882 1,061 90 7,215 2.265 4,357 1,168 103 7,893 2,353 4.879 1,287 117 8.635 761 1,775 2,535 1,891 732 2,047 2,779 2,114 767 2,278 3,045 2,315 800 2,515 3.315 2,525 836 2,795 3,631 2,755 874 3,098 3,971 3,005 Operating income NOPAT Depreciation CapEx Changes in NWC FCF 963 655 51 189 -5 1,147 780 193 325 134 514 1,253 852 156 340 -41 709 1,374 935 158 356 40 697 1,508 1,025 163 373 50 766 1,659 1,128 160 390 30 868 Net PPE Net PPE as percentage of sale NWC NWC as percentage of sales 1,423 30.4% 454.10 9.7% 1,560 28.9% 448.66 8.3% 1,692 28.0% 582.30 9.6% 1,876 28.4% 541.77 8.2% 2.074 28.7% 581.93 8.1% 2,284 28.9% 631.52 8.0% 2,513 29.1% 661.76 7.7% Tax rate 32% MARS, INCORPORATED Bonds Market Interest Rates, April 2008 Corporate bonds A Baa 5.55% 5.93% 6.30% 6.97% Data source: Mergent Bond Record, April 2008. Treasury bills 1-month 3-month 6-month 1-year 2-year 3-year 5-year 7-year 10-year 20-year 30-year 1.07% 1.31% 1.58% 1.74% 2.05% 2.23% 2.84% 3.19% 3.68% 4.40% 4.44% Data source: U.S. Treasury, Market Risk Premium 6% Step # 1: Estimate Wrigley's WACC. Step # 2: Estimate Wrigley's Free cash flow to the firm (FCFF) from 2008- 2012 (see Excel file sent to your group). Step # 3: Estimate Wrigley's Terminal Value (TV) in 2012: Prv - FCFF, * (1 + Quy) x discount factor (WACCTV-97v) Step # 4: Estimate Wrigley's Enterprise Value (EV), which of course include the Terminal Value (TV) Step #5: Estimate Wrigley's Equity (E) E = EV-Debt Step # 6: Estimate Wrigley's share price Po= E Number of Shares