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HQ Sustainable Maritime Industries, Inc. is an integrated aquatic product company (producing, processing, and farming) in the People's Republic of China. Its principal products include

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HQ Sustainable Maritime Industries, Inc. is an integrated aquatic product company (producing, processing, and farming) in the People's Republic of China. Its principal products include tilapia and white-legged shrimp that are exported to the United States, Canada, Japan, and Europe. Selected financial statement values for HQ are shown in the table below. What is the degree of financial leverage for HQ given the change in revenues from Year 1 to Year 2? Selected Accounting Information HQ Sustainable Maritime Industries Inc. (S000s) Year 1 Year 2 EBIT 11,015.45 13.549.00 Interest 673.96 673.96 Pre-Tax Income 10,341.49 12,875.04 Taxes 4,653.67 5,793.77 Net Income 5,687.82 7,081.27 Shares Outstanding 14,540 14,540 EPS 0.3912 0.4870 The degree of financial leverage for HQ is (Round to two decimal places.)

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