Beruflich Dokumente
Kultur Dokumente
Bottom up
Cash
Inventory
Other non-cash CA
Current liabilities
2013
2014
$466
$350
$1,462
$1,704
$285
$335
2013
2014
Accounts payable
$806
$1,067
Short-term debt
$392
$395
Other non-debt CL
$778
$702
2013
$1,747
$1,584
$163
2014
$2,039
$1,769
$270
1.4%
2.0%
$107
$13,673
$11,635
Forecast
2015E
2016E
2017E
$263
1.7%
-$7
$15,450
$286
1.7%
$23
$16,841
$306
1.7%
$20
$18,020
$1,509
750
65
$ 694
70
$ 624
187
$ 437
$109
328
2011
$104
455
553
$1,112
Fixed assets:
Property, plant and equip.
$1,233
Intangible assets and others
411
Total fixed assets
$1,644
Total assets
$2,756
2012
$160
688
555
$1,403
$1,280
429
$1,709
$3,112
2011
2012
Current liabilities:
Accounts payable
Notes payable
Accrued expenses
Total current liabilities
$232
157
39
$428
$266
98
25
$389
Long-term debt
$408
$454
Owners equity
Common stock and
paid-in surplus
Retained earnings
Total equity
Total liabilities and equity
600
640
1,320
1,629
$1,920 $2,269
$2,756 $3,112
Adjusting Earnings
Obtaining most recent financial information
Constructing trailing 12-month data
7/1-6/30
1.1-31/12 China
Sept 2009
Mar 2010
Sept 2010
Mar 2011
Sept 2011
April 11
Bs: direct use half yearly
INCOME ITEM:
Cash Flows and Financial Forecast 13
Adjusting Earnings
Adjustments for R&D expenses
R&D expenses are to generate future growth, so are long-term
investment in nature.
Accounting standards however require that all R&D spending be
Adjusting Earnings
The effect of R&D expenses on equity
Adjusted equity = Equity + Value of R&D assets
As capital investment, R&D expenses increase long-term assets
and hence equity, and are amortized over time.
The assets from R&D expenses equals the sum of all unamortized
portions of all previous years R&D expenses.
EBIT
Year 1:
Adjusted
Equity :
Adjusting Earnings
Adjustments for lease expenses
Adjusting Earnings
Extraordinary and unusual items
Earnings that can be used as a basis for projections should
reflect continuing operations, and not one-time items.
One-time expense or income items (e.g., a large restructuring
Sales forecast
Sales forecast is the starting point of financial forecast, and is
Technical analysis
2002
2003
2004
2005*
2002
2003
2004
2005*
2002
--
2003
23%
2004
17%
Forecast
2005
28%
84
9
28
9
2006
25% Average.
86
12
28
14
45
50
Net sales
Cost of goods sold
Gross profit
Expenses:
General, selling and admin expenses
Net interest expense (760 @ 10%)
15:LTD.
Earnings before tax
- assuming LTD doesn't change !
Tax
Earnings after tax
$ 25,766
22,159
3,607
3,092
76
439
198
$ 241
Comments
25% increase
86% of sales
12% sales
Assets
Current assets
Net fixed assets
Total assets
$ 7,214
412
7,626
100
3,607
3,707
660
150
1,700
$ 6,217
$ 1,409
Comments
28% sales
1.6% sales
As in 2005
14% sales
Existing debt
As in 2005
As explained
Interest expense
The interest expense is calculated for existing debt at the beginning
of the financial year, $760 thousands, without taking into account
any new debt needed in the year.
1
2 Year
3
4
5
6
7
8
9
10
11
12
13
14
15
Net sales
Growth rate in net sales
Cost of good sold/net sales
Gen., sell. & admin. expenses/net sales
Long-term debt
Current portion long-term debt
Interest rate
Tax rate
Dividend/earnings after tax
Current assets/net sales
Net fixed assets
Current liabilities/net sales
Owners' equity
B
2005 Actual
2006
$20,613
$760
$100
25.0%
86.0%
12.0%
$660
$100
10.0%
45.0%
50.0%
28.0%
1.6%
14.0%
$1,730
Cash Flows and Financial Forecast 35
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
B
Equations
C
Forecast
=B3+B3*C4
=C5*C19
=C19-C20
=C6*C19
=C9*(C7+C8)
=C21-C22-C23
=C10*C24
=C24-C25
=C11*C26
=C26-C27
=C12*C19
=C13*C19
=C31+C32
7,215
412
7,627
=C14*C19
=B7
=B15+C28
=C35+C36+C37
3,607
760
1,851
6,218
=C33-C38
$25,766
22,159
3,607
3,092
76
439
198
242
121
121
$1,409
Cash Flows and Financial Forecast 36
Scenario and sensitivity analyses generate various possibilities some are good and some are bad, which deepen our understanding
of the project and help us make a better decision (though we dont
get any guidance as to what to do).