Question 6 O pts Newspapers Companies K and L are newspaper companies. One company owns and operates two newspapers in the southwestern United States. Due to the transition of customer preference from print to digital, the company has begun offering marketing and digital-advertising services and acquiring firms in more profitable industries. The company has introduced cost controls to address cost-structure issues such as personnel expenses. Founded in 1896, the other company is renowned for its highly circulated newspaper offered both in print and online formats. This paper is sold and distributed domestically as well as around the world. Because the company is focused largely on one product, it has strong central controls that have allowed it to remain profitable despite the fierce competition for subscribers and advertising revenues. Hints: - Which firm has acquired other companies? How does this affect the balance sheet? - Fixed asset turnover in this case is simply a function of the cost of real estate owned by the firm. Which company's headquarters should cost more? Newspapers in southwest is K, National and International Newspaper is L O Newspapers in southwest is L, National and International Newspaper is K Beer B 15 9 9 A 5 3 2 3 14 14 0 70 70 2 100 3 35 64 0 1 1 1 100 Power C D 5 25 7 8 2 7 5 6 19 46 62 19 0 0 8 3 12 33 100 100 Retail E F 30 8 10 3 16 25 0 4 56 39 33 49 0 0 6 6 4 7 100 100 Hospitality G H 7 2 4 18 0 0 4 3 15 23 53 17 0 0 9 39 23 21 100 100 Computers 1 14 41 10 18 1 16 5 9 31 84 8 4 56 56 0 3 2 2 9 100 100 Newspapers K L 25 35 9 14 0 2 2 4 ad . 36 56 25 23 13 0 5 19 21 2 100 100 Airlines M N 6 10 4 2 1 1 5 4 17 16 42 75 0 1 28 1 1 13 8 100 Pharmaceutic 0 P 1 13 5 11 2 3 10 2 2 11 35 3 23 0 10 85 26 1 6 100 100 100 31 5 15 6 0 12 18 52 9 4 8 21 32 9 4 66 34 100 13 7 0 11 17 0 9 9 3 29 71 100 0 5 7 7 19 50 3 12 83 17 100 5 1 8 13 4 7 0 7 24 76 100 17 0 20 38 36 0 15 89 11 100 12 4 12 28 18 " 8 4 2 4 8 15 14 " 1 .. 18 47 53 100 10 5 38 53 63 0 43 159 (59) 100 5 3 24 24 33 13 0 4 4 0 20 24 0 0 5 29 71 100 4 8 12 23 10 0 32 66 34 100 2 5 5 19 26 16 10 14 6 63 37 100 1 2 8 o 11 62 12 3 88 12 100 4 4 0 19 23 22 0 0 13 59 41 100 2 14 59 80 20 100 0 28 46 54 100 34 80 20 100 41 100 100 ASSETS (%) %) Cash & ST Investments Receivables Inventory Current Assets Other Current Assets-Total Net Property, Plant, & Equipment Long-Term Marketable Securities Goodwill & Intangibles Assets Other Assets-Total LIABILITIES & EQUITY (%) Accounts Payable Debt in Current Liabilities Current Liabilities-Other Current LiabilitiesTotal Long-Term Debt Deferred Taxes Liabilities Other Liabilities-Total Stockholders' Equity Total Liabilities & Equity INCOME/EXPENSES (%) Revenue Cost of Goods Sold Gross Profit SG&A Expense R&D Exp. Depreciation & Amort. Other Operating Expense Earnings before Interest and Taxes Net Interest Expense Other Pretax Income Income Tax Expense Minority Int. in Earnings Net Income MARKET DATA Beta Price/Eamings Price to Book Dividend Payout (%) LIQUIDITY Current Ratio Quick Ratio ASSET MANAGEMENT Inventory Turnover Receivables Turnover Fixed Assets Turnover DEBT MANAGEMENT T. Total Debt/Total Assets (%) LT Debt/Shareholders' Equity (%) Interest Coverage DuPONT ANALYSIS Net Profit Margin (%) Asset Turnover Return on Equity (%) nmf = not a meaningful figure 100 (39) 61 (32) 0 0 3 32 (4) 1 29 (6) (4) 19 100 (48) 52 (36) 0 0 0 0 16 0 (0) 16 (6) 0 0 10 100 100 100 100 (81) (74) (67) (63) 19 26 33 36 (1) (7) (19) (28) 0 (4) (12) 0 0 0 0 0 0 (0) (0) 0 18 14 2 8 (6) 0 (0) (1) ( 0 (0) (0) 8 15 1 7 (3) 0 (1) (3) (3) 0 0 0 2 15 1 4 100 100 (63) (26) 37 74 (12) (23) 0 0 (13) (4) 0 0 13 47 (2) (5) (3) 2 8 44 (3) (14) 0 0 5 30 100 (60) 40 (6) (3) 0 0 0 30 1 (0) 11 31 (8) 0 22 23 100 (69) 31 (12) (13) 0 0 6 100 (39) 61 45 0 4 0 12 100 100 (101) (70) (1) 30 0 (4) 0 0 5 (5) 0 (5) ! (5) 16 0 (1) (2) 3 (7) 18 1 (6) 0 0 (7) 11 100 (60) 40 (4) 0 (5) (12) 19 (2) 0 17 17 (7) 0 11 100 (23) 77 (26) (3) 0 (23) ) 25 (15) (12) (1) (1) (0) (3) 100 (24) 76 (33) (24) 0 0 19 (0) (4) 14 (2) 0 12 0 0 6 6 (2 0 4 0 4 0.95 24.2 4.2 88.2 0.95 34.0 3.9 0.0 1.15 1.50 1.05 27.2 9.7 nmf 1.8 1.2 25.5 91.5 0.0 0.0 1.00 1.15 19.2 59.8 6.4 0.3 197.5 0.0 1.15 24.0 nmf 29.5 0.95 12.8 5.0 21.8 1.20 22.0 2.8 0.0 0.95 nmf 0.8 (39.4) 1.15 34.9 2.7 41.8 1.20 10.0 3.9 7.9 1.10 10.9 2.4 0.0 0.75 22.9 6.1 88.7 1.15 18.3 5.5 0.0 0.64 0.41 2.01 1.35 0.99 3.48 1.08 0.63 2.490.77 1.04 1.02 0.30 0.72 0.43 0.37 1.11 0.90 3.50 2.45 3.17 2.82 1.53 1.45 0.52 0.31 0.60 0.44 1.53 1.03 1.04 0.62 62.8 5.9 13.0 2.2 8.5 25.3 2.4 17.6 5.8 0.6 4.6 9.3 7.7 17.8 5.5 4.9 11.7 4.1 109.7 nmf 8.8 13.1 0.6 14.1 13.6 10.8 3.9 5.3 22.0 61.2 8.3 4.8 nmf 7.1 2.4 37.0 16.5 1.9 85.4 43.3 1.0 1.6 5.9 2.5 2.3 4.3 7.6 2.5 66.0 95.2 6.5 28.5 0.1 nmf 83.0 24.2 79.5 88.7 47.4 47.4 159.0 292.5 5.2 106.0 320.9 26.2 nmf 1.9 74.1 4.9 10.2 4.8 8.1 58.9 44.8 97.2 29.1 0.0 nmf 45.7 0.0 nmf 65.7 29.3 4.2 79.6 62.4 13.6 62.9 43.5 10.0 59.0 54.6 23.2 87.7 501.9 1.7 19.0 0.3 19.7 10.3 1.5 21.9 2.0 15.3 0.6 0.4 0.5 1.8 11.2 10.4 4.9 4.2 1.7 36.2 4.9 0.3 2.9 30.1 2.4 nmf 22.8 0.9 46.2 3.8 1.1 5.8 (6.6) 1.0 (14.8) 4.0 0.6 8.1 11.1 0.8 46.0 10.6 0.8 23.6 12.1 0.6 16.1 (2.8) 0.3 (5.0) Question 6 O pts Newspapers Companies K and L are newspaper companies. One company owns and operates two newspapers in the southwestern United States. Due to the transition of customer preference from print to digital, the company has begun offering marketing and digital-advertising services and acquiring firms in more profitable industries. The company has introduced cost controls to address cost-structure issues such as personnel expenses. Founded in 1896, the other company is renowned for its highly circulated newspaper offered both in print and online formats. This paper is sold and distributed domestically as well as around the world. Because the company is focused largely on one product, it has strong central controls that have allowed it to remain profitable despite the fierce competition for subscribers and advertising revenues. Hints: - Which firm has acquired other companies? How does this affect the balance sheet? - Fixed asset turnover in this case is simply a function of the cost of real estate owned by the firm. Which company's headquarters should cost more? Newspapers in southwest is K, National and International Newspaper is L O Newspapers in southwest is L, National and International Newspaper is K Beer B 15 9 9 A 5 3 2 3 14 14 0 70 70 2 100 3 35 64 0 1 1 1 100 Power C D 5 25 7 8 2 7 5 6 19 46 62 19 0 0 8 3 12 33 100 100 Retail E F 30 8 10 3 16 25 0 4 56 39 33 49 0 0 6 6 4 7 100 100 Hospitality G H 7 2 4 18 0 0 4 3 15 23 53 17 0 0 9 39 23 21 100 100 Computers 1 14 41 10 18 1 16 5 9 31 84 8 4 56 56 0 3 2 2 9 100 100 Newspapers K L 25 35 9 14 0 2 2 4 ad . 36 56 25 23 13 0 5 19 21 2 100 100 Airlines M N 6 10 4 2 1 1 5 4 17 16 42 75 0 1 28 1 1 13 8 100 Pharmaceutic 0 P 1 13 5 11 2 3 10 2 2 11 35 3 23 0 10 85 26 1 6 100 100 100 31 5 15 6 0 12 18 52 9 4 8 21 32 9 4 66 34 100 13 7 0 11 17 0 9 9 3 29 71 100 0 5 7 7 19 50 3 12 83 17 100 5 1 8 13 4 7 0 7 24 76 100 17 0 20 38 36 0 15 89 11 100 12 4 12 28 18 " 8 4 2 4 8 15 14 " 1 .. 18 47 53 100 10 5 38 53 63 0 43 159 (59) 100 5 3 24 24 33 13 0 4 4 0 20 24 0 0 5 29 71 100 4 8 12 23 10 0 32 66 34 100 2 5 5 19 26 16 10 14 6 63 37 100 1 2 8 o 11 62 12 3 88 12 100 4 4 0 19 23 22 0 0 13 59 41 100 2 14 59 80 20 100 0 28 46 54 100 34 80 20 100 41 100 100 ASSETS (%) %) Cash & ST Investments Receivables Inventory Current Assets Other Current Assets-Total Net Property, Plant, & Equipment Long-Term Marketable Securities Goodwill & Intangibles Assets Other Assets-Total LIABILITIES & EQUITY (%) Accounts Payable Debt in Current Liabilities Current Liabilities-Other Current LiabilitiesTotal Long-Term Debt Deferred Taxes Liabilities Other Liabilities-Total Stockholders' Equity Total Liabilities & Equity INCOME/EXPENSES (%) Revenue Cost of Goods Sold Gross Profit SG&A Expense R&D Exp. Depreciation & Amort. Other Operating Expense Earnings before Interest and Taxes Net Interest Expense Other Pretax Income Income Tax Expense Minority Int. in Earnings Net Income MARKET DATA Beta Price/Eamings Price to Book Dividend Payout (%) LIQUIDITY Current Ratio Quick Ratio ASSET MANAGEMENT Inventory Turnover Receivables Turnover Fixed Assets Turnover DEBT MANAGEMENT T. Total Debt/Total Assets (%) LT Debt/Shareholders' Equity (%) Interest Coverage DuPONT ANALYSIS Net Profit Margin (%) Asset Turnover Return on Equity (%) nmf = not a meaningful figure 100 (39) 61 (32) 0 0 3 32 (4) 1 29 (6) (4) 19 100 (48) 52 (36) 0 0 0 0 16 0 (0) 16 (6) 0 0 10 100 100 100 100 (81) (74) (67) (63) 19 26 33 36 (1) (7) (19) (28) 0 (4) (12) 0 0 0 0 0 0 (0) (0) 0 18 14 2 8 (6) 0 (0) (1) ( 0 (0) (0) 8 15 1 7 (3) 0 (1) (3) (3) 0 0 0 2 15 1 4 100 100 (63) (26) 37 74 (12) (23) 0 0 (13) (4) 0 0 13 47 (2) (5) (3) 2 8 44 (3) (14) 0 0 5 30 100 (60) 40 (6) (3) 0 0 0 30 1 (0) 11 31 (8) 0 22 23 100 (69) 31 (12) (13) 0 0 6 100 (39) 61 45 0 4 0 12 100 100 (101) (70) (1) 30 0 (4) 0 0 5 (5) 0 (5) ! (5) 16 0 (1) (2) 3 (7) 18 1 (6) 0 0 (7) 11 100 (60) 40 (4) 0 (5) (12) 19 (2) 0 17 17 (7) 0 11 100 (23) 77 (26) (3) 0 (23) ) 25 (15) (12) (1) (1) (0) (3) 100 (24) 76 (33) (24) 0 0 19 (0) (4) 14 (2) 0 12 0 0 6 6 (2 0 4 0 4 0.95 24.2 4.2 88.2 0.95 34.0 3.9 0.0 1.15 1.50 1.05 27.2 9.7 nmf 1.8 1.2 25.5 91.5 0.0 0.0 1.00 1.15 19.2 59.8 6.4 0.3 197.5 0.0 1.15 24.0 nmf 29.5 0.95 12.8 5.0 21.8 1.20 22.0 2.8 0.0 0.95 nmf 0.8 (39.4) 1.15 34.9 2.7 41.8 1.20 10.0 3.9 7.9 1.10 10.9 2.4 0.0 0.75 22.9 6.1 88.7 1.15 18.3 5.5 0.0 0.64 0.41 2.01 1.35 0.99 3.48 1.08 0.63 2.490.77 1.04 1.02 0.30 0.72 0.43 0.37 1.11 0.90 3.50 2.45 3.17 2.82 1.53 1.45 0.52 0.31 0.60 0.44 1.53 1.03 1.04 0.62 62.8 5.9 13.0 2.2 8.5 25.3 2.4 17.6 5.8 0.6 4.6 9.3 7.7 17.8 5.5 4.9 11.7 4.1 109.7 nmf 8.8 13.1 0.6 14.1 13.6 10.8 3.9 5.3 22.0 61.2 8.3 4.8 nmf 7.1 2.4 37.0 16.5 1.9 85.4 43.3 1.0 1.6 5.9 2.5 2.3 4.3 7.6 2.5 66.0 95.2 6.5 28.5 0.1 nmf 83.0 24.2 79.5 88.7 47.4 47.4 159.0 292.5 5.2 106.0 320.9 26.2 nmf 1.9 74.1 4.9 10.2 4.8 8.1 58.9 44.8 97.2 29.1 0.0 nmf 45.7 0.0 nmf 65.7 29.3 4.2 79.6 62.4 13.6 62.9 43.5 10.0 59.0 54.6 23.2 87.7 501.9 1.7 19.0 0.3 19.7 10.3 1.5 21.9 2.0 15.3 0.6 0.4 0.5 1.8 11.2 10.4 4.9 4.2 1.7 36.2 4.9 0.3 2.9 30.1 2.4 nmf 22.8 0.9 46.2 3.8 1.1 5.8 (6.6) 1.0 (14.8) 4.0 0.6 8.1 11.1 0.8 46.0 10.6 0.8 23.6 12.1 0.6 16.1 (2.8) 0.3 (5.0)