Model Facts

Copyright 2001 by the Trustees of the University of Virginia Darden School Foundation.
Revised, March 7, 2006.

Page 1
 Model Facts

This spreadsheet supports student analysis of the case, "The Body Shop International Plc
2001" (Case 9)

Please note:

1) This is a working model. Assumptions / Inputs presented can be changed to vary the results.

2) This spreadsheet incorporates circular logical reference. To resolve this circularity, please
instruct Excel to "iterate" several times in calculating the results. This is accomplished by
clicking on Tools/Options/Calculation, and then checking the iteration box.

3) As long as default spreadsheet calculation is set as "automatic" impact of changing

assumptions will be computed in real time. Alternatively the F9 function key may need to be
invoked to recalculate results. To set the numerical calculation settings to automatic, please
click on Tools/Options/Calculations menu, and check the automatic calculation option.

Copyright 2001 by the Trustees of the University of Virginia Darden School Foundation.
Revised, March 7, 2006.

Page 2
 A B C D E F G H I
1
2 Input Data Exhibit 1
3 The Body Shop Plc 2001: Format for Developing a Spreadsheet Model
4 SALES 422,733
5 COGS/SALES 0.38
6 OPERATING EXPENSES/SALES 0.50
7 INTEREST RATE 0.06
8 TAX RATE 0.30
9 DIVIDENDS (Thousand pounds) 10,900
10 CURR. ASSETS/SALES 0.32
11 CURR. LIABS./SALES 0.28
12 FIXED ASSETS 110,600
13 STARTING EQUITY 121,600
14
15 INCOME STATEMENT 2002
16
17 SALES
18 COGS
19 OPERATING EXPENSES
20 INTEREST EXPENSE (INCOME)
21 PROFIT BEFORE TAX
22 TAX
23 PROFIT AFTER TAX
24 DIVIDENDS
25 EARNINGS RETAINED
26
27 BALANCE SHEET 2002
28
29 CURRENT ASSETS
30 FIXED ASSETS
31 TOTAL ASSETS
32
33 CURRENT LIABILITIES
34 DEBT
35 EQUITY
36 TOTAL LIAB. & NET WORTH
 A B C
1
2 Exhibit 2
3 The Body Shop Plc 2001:
4 Spreadsheet Formulas to Forecast 2002 Financials:
5
6 Input Data
7
8 SALES 422,733
9 COGS/SALES 0.38
10 OPERATING EXPENSES/SALES 0.50
11 INTEREST RATE 0.06
12 TAX RATE 0.30
13 DIVIDENDS (Thousand pounds) 10,900
14 CURR. ASSETS/SALES 0.32
15 CURR. LIABS./SALES 0.28
16 FIXED ASSETS 110,600
17 STARTING EQUITY 121,600
18
19 INCOME STATEMENT 2002
20
21 SALES +B3
22 COGS +B4*B16
23 OPERATING EXPENSES +B5*B16
24 INTEREST EXPENSE (INCOME) +B6*B33
25 PROFIT BEFORE TAX +B16-B17-B18-B19
26 TAX +B7*B20
27 PROFIT AFTER TAX +B20-B21
28 DIVIDENDS +B8
29 EARNINGS RETAINED +B22-B23
30
31 BALANCE SHEET 2002
32
33 CURRENT ASSETS +B9*B16
34 FIXED ASSETS +B11
35 TOTAL ASSETS +B28+B29
36
37 CURRENT LIABILITIES +B10*B16
38 DEBT +B30-B32-B34
39 EQUITY +B12+B24
40 TOTAL LIAB. & NET WORTH +B32+B33+B34
 A B C D E F
1
2 Exhibit 3
3 The Body Shop Plc 2001:
4 Basic Forecasting Results for 2002
5
6 Input Data
7
8 SALES 422,733
9 COGS/SALES 0.38
10 OPERATING EXPENSES/SALES 0.50
11 INTEREST RATE 0.06
12 TAX RATE 0.30
13 DIVIDENDS (Thousand pounds) 10,900
14 CURR. ASSETS/SALES 0.32
15 CURR. LIABS./SALES 0.28
16 FIXED ASSETS 110,600
17 STARTING EQUITY 121,600
18
19 INCOME STATEMENT 2002
20
21 SALES 422,733
22 COGS 160,639
23 OPERATING EXPENSES 211,367
24 INTEREST EXPENSE (INCOME) (1,171)
25 PROFIT BEFORE TAX 51,899
26 TAX 15,570
27 PROFIT AFTER TAX 36,329
28 DIVIDENDS 10,900
29 EARNINGS RETAINED 25,429
30
31 BALANCE SHEET 2002
32
33 CURRENT ASSETS 135,275
34 FIXED ASSETS 110,600
35 TOTAL ASSETS 245,875
36
37 CURRENT LIABILITIES 118,365
38 DEBT (19,520)
39 EQUITY 147,029
40 TOTAL LIAB. & NET WORTH 245,875
 A B C
1
2 Exhibit4
3 TheBodyShopPlc2001:
4 AdjustingtoReflectExcessCash
5
6 InputData
7
8 SALES 422,733
9 COGS/SALES 0.38
10 OPERATINGEXPENSES/SALES 0.50
11 INTERESTRATE 0.06
12 TAXRATE 0.30
13 DIVIDENDS(Thousandpounds) 10,900
14 CURR.ASSETS/SALES 0.32
15 CURR.LIABS./SALES 0.28
16 FIXEDASSETS 110,600
17 STARTINGEQUITY 121,600
18
19 INCOMESTATEMENT 2002
20
21 SALES 422,733
22 COGS 160,639
23 OPERATINGEXPENSES 211,367
24 INTERESTEXPENSE(INCOME) +(B6*B34)(B6*B28)
25 PROFITBEFORETAX 40,706
26 TAX 14,247
27 PROFITAFTERTAX 26,459
28 DIVIDENDS 10,900
29 EARNINGSRETAINED 15,559
30
31 BALANCESHEET 2002
32
33 EXCESSCASH =IF(B40<0,B40,0)
34 CURRENTASSETS 135,275
35 FIXEDASSETS 110,600
36 TOTALASSETS +B29+B30+B28
37
38 CURRENTLIABILITIES 118,365
39 DEBT =IF(B40>0,+B40,0)
40 EQUITY 137,159
41 TOTALLIAB.&NETWORTH +B33+B34+B35
42
43 TRIALASSETS +B29+B30
44 TRIALLIABILITIESANDEQUITY +B33+B35
45 PLUG:DEBT(EXCESSCASH) +B38B39
 A B C
1
2 Exhibit 5
3 The Body Shop Plc 2001:
4 Finished Results for 2002, Reflecting Excess Cash
5
6 Input Data
7
8 SALES 422,733
9 COGS/SALES 0.38
10 OPERATING EXPENSES/SALES 0.50
11 INTEREST RATE 0.06
12 TAX RATE 0.30
13 DIVIDENDS (Thousand pounds) 10,900
14 CURR. ASSETS/SALES 0.32
15 CURR. LIABS./SALES 0.28
16 FIXED ASSETS 110,600
17 STARTING EQUITY 121,600
18
19 INCOME STATEMENT 2002
20
21 SALES 422,733
22 COGS 160,639
23 OPERATING EXPENSES 211,367
24 INTEREST EXPENSE (INCOME) (1,171)
25 PROFIT BEFORE TAX 51,899
26 TAX 15,570
27 PROFIT AFTER TAX 36,329
28 DIVIDENDS 10,900
29 EARNINGS RETAINED 25,429
30
31 BALANCE SHEET 2002
32
33 EXCESS CASH 19,520
34 CURRENT ASSETS 135,275
35 FIXED ASSETS 110,600
36 TOTAL ASSETS 265,395
37
38 CURRENT LIABILITIES 118,365
39 DEBT 0
40 EQUITY 147,029
41 TOTAL LIAB. & NET WORTH 265,395
42
43 TRIAL ASSETS 245,875
44 TRIAL LIABILITIES AND EQUITY 265,395
45 PLUG: DEBT (EXCESS CASH) (19,520)
 A B C D E F G
1
2 Exhibit 6
3 The Body Shop Plc 2001:
4 Set up for a Forecast with Data Table
5
6 Input Data
7
8 SALES 422,733
9 COGS/SALES 0.38
10 OPERATING EXPENSES/SALES 0.50 Sensitivity Analysis
11 INTEREST RATE 0.06 Of Debt and Excess Cash
12 TAX RATE 0.30 To COGS/SALES Ratio
13 DIVIDENDS (Thousand pounds) 10,900
14 CURR. ASSETS/SALES 0.32 COGS/SALES DEBT Ex. CASH
15 CURR. LIABS./SALES 0.28 =B34 =B28
16 FIXED ASSETS 110,600 0.35
17 STARTING EQUITY 121,600 0.38
18 0.40
19 INCOME STATEMENT 2002 0.42
20 0.44
21 SALES 422,733 0.45
22 COGS 160,639 0.48
23 OPERATING EXPENSES 211,367
24 INTEREST EXPENSE (INCOME) (1,171)
25 PROFIT BEFORE TAX 51,899
26 TAX 15,570
27 PROFIT AFTER TAX 36,329
28 DIVIDENDS 10,900
29 EARNINGS RETAINED 25,429
30
31 BALANCE SHEET 2002
32
33 EXCESS CASH 19,520
34 CURRENT ASSETS 135,275
35 FIXED ASSETS 110,600
36 TOTAL ASSETS 265,395
37
38 CURRENT LIABILITIES 118,365
39 DEBT -
40 EQUITY 147,029
41 TOTAL LIAB. & NET WORTH 265,395
42
43 TRIAL ASSETS 245,875
44 TRIAL LIABILITIES AND EQUITY 265,395
45 PLUG: DEBT (EXCESS CASH) (19,520)
 A B C D E F G H
1
2 Exhibit 7
3 The Body Shop Plc 2001:
4 Finished Forecast with Data Table
5
6 Input Data
7
8 SALES 422,733
9 COGS/SALES 0.38
10 OPERATING EXPENSES/SALES 0.50 Sensitivity Analysis
11 INTEREST RATE 0.06 Debt and Excess Cash
12 TAX RATE 0.30 By COGS/SALES
13 DIVIDENDS (Thousand pounds) 10,900.00
14 CURR. ASSETS/SALES 0.32 COGS/SALES DEBT Ex. CASH
15 CURR. LIABS./SALES 0.28 +B34 +B28
16 FIXED ASSETS 110,600 0.35 0 28,787
17 STARTING EQUITY 121,600 0.38 0 19,520
18 0.40 0 13,342
19 INCOME STATEMENT 2002 0.42 0 7,165
20 0.44 0 987
21 SALES 422,733 0.45 2,102 0
22 COGS 160,639 0.48 11,369 0
23 OPERATING EXPENSES 211,367
24 INTEREST EXPENSE (INCOME) (1,171)
25 PROFIT BEFORE TAX 51,899
26 TAX 15,570
27 PROFIT AFTER TAX 36,329
28 DIVIDENDS 10,900
29 EARNINGS RETAINED 25,429
30
31 BALANCE SHEET 2002
32
33 EXCESS CASH 19,520
34 CURRENT ASSETS 135,275
35 FIXED ASSETS 110,600
36 TOTAL ASSETS 265,395
37
38 CURRENT LIABILITIES 118,365
39 DEBT 0
40 EQUITY 147,029
41 TOTAL LIAB. & NET WORTH 265,395
42
43 TRIAL ASSETS 245,875
44 TRIAL LIABILITIES AND EQUITY 265,395
45 PLUG: DEBT (EXCESS CASH) (19,520)
Exhibit 8
The Body Shop Plc 2001:
Historical Financial Statements ( in GBP millions)

Fiscal Year Ended February 28

1999 1999 2000 2000 2001 2001

(GBP) (% sales) (GBP) (% sales) (GBP) (% sales)
Income Statement

Turnover 303.7 100.0 330.1 100.0 374.1 100.0

Cost of sales 127.7 42.0 130.9 39.7 149.0 39.8
Gross profit 176.0 58.0 199.2 60.3 225.1 60.2

Operating expenses:
excluding exceptional costs 151.4 49.9 166.2 50.3 195.7 52.3
exceptional costs1 4.5 1.5 0.0 0.0 11.2 3.0
Restructuring costs2 16.6 5.5 2.7 0.8 1.0 0.3
Net interest expense 0.1 0.0 1.5 0.5 4.4 1.2
Profit before tax 3.4 1.1 28.8 8.7 12.8 3.4
Tax expense 8.0 2.6 10.4 3.2 3.5 0.9
Profit (loss) after tax (4.6) (1.5) 18.4 5.6 9.3 2.5

Ordinary dividends 10.9 3.6 10.9 3.3 10.9 2.9

Profit (loss) retained (15.5) (5.1) 7.5 2.3 (1.6) (0.4)

Fiscal Year Ended February 28

1999 1999 2000 2000 2001 2001

Balance Sheet (GBP) (% sales) (GBP) (% sales) (GBP) (% sales)

Assets
Cash 34.0 11.2 19.2 5.8 13.7 3.7
Accounts receivable 27.8 9.2 30.3 9.2 30.3 8.1
Inventories 38.6 12.7 44.7 13.5 51.3 13.7
Other current assets 12.5 4.1 15.6 4.7 17.5 4.7
Net fixed assets 87.8 28.9 104.7 31.7 110.6 29.6
Other assets3 0.0 0.0 6.0 1.8 6.7 1.8
Total assets 200.7 66.1 220.5 66.8 230.1 61.5

Liabilities and equity

Accounts payable 13.0 4.3 20.5 6.2 10.7 2.9
Taxes payable 11.3 3.7 11.7 3.5 7.1 1.9
Accruals 10.8 3.6 15.6 4.7 11.5 3.1
Overdrafts 0.0 0.0 0.3 0.1 0.7 0.2
Other current liabilities 21.6 7.1 13.3 4.0 16.9 4.5
Long-term liabilities 28.0 9.2 36.7 11.1 61.2 16.4
Other liabilities4 1.7 0.6 1.0 0.3 0.4 0.1
Shareholders' equity 114.3 37.6 121.4 36.8 121.6 32.5
Total liabilities and equity 200.7 66.1 220.5 66.8 230.1 61.5

1
Exceptional costs in 2001 included redundancy costs (4.6 million), costs of supply chain development (2.4 million) and impairment of fixed assets and goodwill (4.2 million). The
exceptional costs of 4.5 million in 1999 were associated with closing unprofitable shops and an impairment review of the remaining shops in the USA.
2
Restructuring costs in 2001 and 2000 relate to the sale of manufacturing plants in Littlehampton, England, and to associated reorganization costs. Restructuring costs in 1999 arose
from the realignment of the management structure of the business in the US and the UK.
3
Other assets in 2001 and 2000 represented receivables relating to the sale of the company's Littlehampton manufacturing plant.
4
Other liabilities included mostly deferred taxes.