SHORT ANSWER 1) Calculate the Profit Margin for John Deere for 2018 and 2017 using the included financials 2) From the above profit margins how does this form appear to be doing financially and would you vest in them? Give a brief explanation why you would or would not invest, you can also reference the past years shown 3) Your business has made 10 million gross revenue with a net profit margin of 10% over 5 years of op crations. An investor put in an initial investment of $250,000 for a 10% equity stake in the company How much money has the investor made (or lost) from this deal? John Deer: Statement of Cash Flows Breakdown TTM 10/31/2018 10/31/2017 10/31/2016 10/31/2015 Cash flows from operating activ Net Income 3.316.400 2.368.400 1,940,000 Depreciation & amortization 2.004.100 1.927 100 2.159,100 1,715,500 100,100 Deferred income taxes 506.900 Stock based compensation 68.100 83,800 -3.131.400 1.523.900 1.559,800 282.700 70,600 314.100 335200 -106, 100 1.479.900 83.800 4.073.400 -1,531,100 -1.772,300 1,382,400 -18.400 56,100 239.900 811,500 -691,400 Change in working capital -1292.300 838.900 Accounts receivable Inventory -1,401,300 -1.305,300 272.800 36.900 2,896,300 -3.790,400 Accounts Payable Other working capital Other non-cash toms Net cash provided by operatin... Cash flows from investing activi > Cash flows from financing activi. Net change in cash Cash at beginning of period Cash at end of period > Free Cash Flow -1,129,800 -7.100 1.820,300 8,154,400 876,400 914.200 40.200 3.740,300 - 1,058.700 436,400 -392.500 299,400 2.199.000 -1,644,300 4206,500 4,999,100 4335,800 9,334.900 -392.500 309.200 - 161.900 3.764.300 -1,177 200 -2,400,500 173,600 4.162.200 4,335,800 809.200 2,119,100 -5,430.900 9,334,900 525,900 4,029,000 3.571,300 272,800 375,200 3,787,000 4.10.200 914.200 3,904.000 - 1,129,800 John Deer: Income Statement Breakdown TTM 10/31/2017 10/31/2016 10/31/2018 37,021,300 Total Revenue 38,441,300 28,048,800 10,392,500 Cost of Revenue 10/31/2015 28.609,300 20,983,200 7,626, 100 29,115,600 21,001,000 8,114,600 26,985,800 10,035,500 26,363,500 19,174,600 7.188.900 Gross Profit Operating Expenses Research Development 1,764,600 1,657,600 1,367.700 1.389.100 1,425,100 3,680,500 3.630.500 3,056,300 Seling General and Administrative Total Operating Expenses 2.951,700 4.980,800 5,979,100 4,871,400 6,165,100 4.227,400 Operating Income or Loss 4.056.400 2.208,100 2,754,700 Interest Expense 763,700 Total Other Income/Expenses Net 16,000 14.000 4,070,700 3,253,600 5,353,300 2,761,300 899.500 392.000 3,153,800 971,100 2,159,200 2,159,100 2,158,500 Income Before Tax Income Tax Expense 4,241,700 950,900 3,319,600 1,726,900 680.000 26,000 2,780,100 840,100 1,940,900 1.940,000 1,939,200 Income from Continuing Operations 2224,000 700,100 1,521,500 1,523,900 1,523,200 Net Income 2,370,600 2,368,400 2,368,000 3,316,400 Net Income available to common s... 3,316,000 > Reported EPS > Weighted average shares outst. EBITDA 5,983,500 4,476,800 3.767.900 4,137,100
