Free Cash Flows
Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)
2013 2012 Sales $4,025.0 $3,500.0 Operating costs excluding depreciation 3,019.0 2,975.0 Depreciation and amortization 126.0 105.0 Earnings before interest and taxes $880.0 $420.0 Less: Interest 87.0 75.0 Pre-tax income $793.0 $345.0 Taxes (40%) 317.2 138.0 Net income available to common stockholders $475.8 $207.0 Common dividends $428.0 $166.0
Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)
2013 2012 Assets Cash $51.0 $46.0 Short-term investments 21.0 18.0 Accounts receivable 630.0 525.0 Inventories 1,050.0 875.0 Total current assets $1,752.0 $1,464.0 Net plant and equipment 1,260.0 1,050.0 Total assets $3,012.0 $2,514.0 Liabilities and Equity Accounts payable $385.0 $350.0 Accruals 319.0 245.0 Notes payable 81.0 70.0 Total current liabilities $785.0 $665.0 Long-term bonds 805.0 700.0 Total liabilities $1,590.0 $1,365.0 Common stock 1,312.2 1,087.0 Retained earnings 109.8 62.0 Total common equity $1,422.0 $1,149.0 Total liabilities and equity $3,012.0 $2,514.0
Using Rhodes Corporation's financial statements (shown above), answer the following questions.
What is the net operating profit after taxes (NOPAT) for 2013? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to one decimal place.
$______ million
What are the amounts of net operating working capital for both years? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.
2013 $ ____ million
2012 $ ____ million
What are the amounts of total net operating capital for both years? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.
2013 $ ____ million
2012 $ ____ million
What is the free cash flow for 2013? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to one decimal place.
$ ________ million
What is the ROIC for 2013? Round your answer to two decimal places.
______ %
How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.
After-tax interest payment $____ million Reduction (increase) in debt $ ____ million Payment of dividends $____ million Repurchase (Issue) stock $____ million Purchase (Sale) of short-term investments $____ million
Free Cash Flows
Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)
| 2013 | 2012 | ||
| Sales | $4,025.0 | $3,500.0 | |
| Operating costs excluding depreciation | 3,019.0 | 2,975.0 | |
| Depreciation and amortization | 126.0 | 105.0 | |
| Earnings before interest and taxes | $880.0 | $420.0 | |
| Less: Interest | 87.0 | 75.0 | |
| Pre-tax income | $793.0 | $345.0 | |
| Taxes (40%) | 317.2 | 138.0 | |
| Net income available to common stockholders | $475.8 | $207.0 | |
| Common dividends | $428.0 | $166.0 |
Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)
| 2013 | 2012 | ||
| Assets | |||
| Cash | $51.0 | $46.0 | |
| Short-term investments | 21.0 | 18.0 | |
| Accounts receivable | 630.0 | 525.0 | |
| Inventories | 1,050.0 | 875.0 | |
| Total current assets | $1,752.0 | $1,464.0 | |
| Net plant and equipment | 1,260.0 | 1,050.0 | |
| Total assets | $3,012.0 | $2,514.0 | |
| Liabilities and Equity | |||
| Accounts payable | $385.0 | $350.0 | |
| Accruals | 319.0 | 245.0 | |
| Notes payable | 81.0 | 70.0 | |
| Total current liabilities | $785.0 | $665.0 | |
| Long-term bonds | 805.0 | 700.0 | |
| Total liabilities | $1,590.0 | $1,365.0 | |
| Common stock | 1,312.2 | 1,087.0 | |
| Retained earnings | 109.8 | 62.0 | |
| Total common equity | $1,422.0 | $1,149.0 | |
| Total liabilities and equity | $3,012.0 | $2,514.0 | |
Using Rhodes Corporation's financial statements (shown above), answer the following questions.
What is the net operating profit after taxes (NOPAT) for 2013? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to one decimal place.
$______ million
What are the amounts of net operating working capital for both years? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.
2013 $ ____ million
2012 $ ____ million
What are the amounts of total net operating capital for both years? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.
2013 $ ____ million
2012 $ ____ million
What is the free cash flow for 2013? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to one decimal place.
$ ________ million
What is the ROIC for 2013? Round your answer to two decimal places.
______ %
How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answers to one decimal place.
| After-tax interest payment | $____ million |
| Reduction (increase) in debt | $ ____ million |
| Payment of dividends | $____ million |
| Repurchase (Issue) stock | $____ million |
| Purchase (Sale) of short-term investments | $____ million |
