WHO IS WHO ?

The following table provides information on seven major companies. Each of them is representative of an
industry :

an airline company
an electric components manufacturer a cement producer
a supermarket company an employment services company
a food products producer a luxury products manufacturer

1 - Calculate the WCR & the Capital Employed for each,

2 - Calculate the Return on Capital Employed and its two components (op margin % & Asset Rotation)
3 - Find which company is hiden behind each column

All figures are in % of sales All figures areAllinfigures

% of sales
are
Allinfigures
% of sales
are
Allinfigures
% of sales
are
Allinfigures
% of sales
are
Allinfigures
% of sales
are in % of sales
Sales 100% 100% 100% 100% 100% 100%
Cost of sales 81.5 56.6 80.6 34.0 72.8 86.7

Administrative, commercial and other costs 16.1 34.5 15.7 41.3 15.9 5.8

OPERATING PROFIT 2.4 8.9 3.7 24.7 11.3 7.5

Financial revenues 0.1 0.6 0.2 1.7 1.4 0.3

Interest on loans 0.2 2.0 0.4 2.9 2.8 2.8

INCOME BEFORE TAX 2.3 7.5 3.5 23.5 9.9 5.0

Income tax 0.8 2.6 1.2 7.3 2.3 1.4

NET INCOME 1.5 4.9 2.3 16.2 7.6 3.6

(1) after deduction of labor costs : 8.2 17.3 8.3 16.7 20.4 27.0
(2) after deduction of depreciation : 0.6 5.2 2.6 3.8 6.2 7.5

Fixed assets 5.1 82.0 29.4 96.0 109.0 99.0

99.0
Inventory 0.0 8.2 7.9 47.3 11.6 0.9
Trade receivables 19.1 16.3 0.2 20.0 19.6 11.8
Other operating receivables 1.5 0.5 9.5 10.3 5.1 5.1

Cash and cash equivalent 3.0 6.8 2.0 38.3 9.1 5.1

Equity 9.9 53.9 16.6 126.7 83.6 35.7

Financial debts 2.1 32.4 5.0 42.3 36.3 48.3

Other liabilities 4.3 2.5 1.3 16.2 10.2 12.8

Trade payables 3.9 13.6 19.2 11.7 9.9 11.8

Other operating liabilities 8.5 11.4 6.9 15.0 14.4 13.3

Investments in operating assets 0.7 5.3 2.6 3.3 8.8 11.0

Acquisitions 0.2 8.9 5.8 0.3 11.0 0.0

PHILIPS Page 1 Finance for non Financial Managers

 WHO IS WHO ?
MARGINS AND COSTS

IN % OF SALES IN % OF IN % O IN % O IN % O
IN % OF SALES
IN % OF SALES

+ SALES 100.0 100.0 100.0 100.0 100.0 100.0

- Cost of sales 81.5 56.6 80.6 34.0 72.8 86.7

= GROSS MARGIN 18.5 43.4 19.4 66.0 27.2 13.3

- administrative and commercial costs 16.1 34.5 15.7 41.3 15.9 5.8

= OPERATING PROFIT (or EBIT) 2.4 8.9 3.7 24.7 11.3 7.5

+ Depreciation 0.6 5.2 2.6 3.8 6.2 7.5

= EBITDA (Earnings Before Interest & Tax Depreciation

3.0& Amort)
14.1 6.3 28.5 17.5 15.0

+ financial revenues - interests -0.1 -1.4 -0.2 -1.2 -1.4 -2.5

= INCOME BEFORE TAX 2.3 7.5 3.5 23.5 9.9 5.0

- income tax 0.8 2.6 1.2 7.3 2.3 1.4

= NET INCOME 1.5 4.9 2.3 16.2 7.6 3.6

+ Net income 1.5 4.9 2.3 16.2 7.6 3.6

+ Depreciation 0.6 5.2 2.6 3.8 6.2 7.5
= NET CASH FLOW 2.1 10.1 4.9 20.0 13.8 11.1

PHILIPS Page 2 Finance for non Financial Managers

PHILIPS Page 3 Finance for non Financial Managers