Question
The following segmental information is available for a multinational company with respect to its assets and capital expenditures. Values are in $ unless specified differently.
The following segmental information is available for a multinational company with respect to its assets and capital expenditures. Values are in $ unless specified differently. EBIT margins for the most current year are also provided. For all the segments, calculate the ratio of capex% to asset%, and use the results to comment on the companys capex allocation strategy across its segments.
Asset and Capital Expenditure Segment Information
| Assets | 2018 | 2017 | 2016 |
|---|---|---|---|
| North America | 1850 | 1180 | 1050 |
| Europe | 2400 | 2340 | 2225 |
| Asia | 1700 | 1580 | 1530 |
| Africa | 1250 | 1110 | 1055 |
| Australia | 1200 | 960 | 920 |
| Total | 8400 | 7170 | 6780 |
| Capital Expenditure | 2018 | 2017 | 2016 | EBIT Margin 2018 |
|---|---|---|---|---|
| North America | 40 | 36 | 26 | 24% |
| Europe | 125 | 120 | 110 | 15% |
| Asia | 83 | 66 | 62 | 13% |
| Africa | 75 | 61 | 42 | 23% |
| Australia | 77 | 66 | 50 | 14% |
| Total | 400 | 349 | 290 |
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Technology And Finance Challenges For Financial Markets Business Strategies And Policy Makers
Authors: Morten Balling, Frank Lierman, Andy Mullineux
1st Edition
041529827X, 978-0415298278
