6 Holly Fashion Case Study

1993 985 748.6 236.4 169.4 10.8 56.2 7 49.2 19.7 29.5

1994 1040 774.8 265.2 202.8 11.4 51 6 45 18.0 27.0

1995 1236 928.2 307.8 236.1 13.6 58.1 5 53.1 21.2 31.9

1996 1305.1 978.8 326.3 249.3 14.4 62.6 4 58.6 23.4 35.2

1993

1994

1995

1996

ASSETS Cash Receivables Inventory Other current assets Current assets Gross fixed Accumulated depreciation Net fixed Total assets

40.4 153.2 117 5.9 316.5 44.8 12 32.8 349.3

51.9 158.9 121.1 6.2 338.1 58.9 23.4 35.5 373.6

38.6 175.1 193.4 7.4 414.5 78.1 37 41.1 455.6

10.6 224.8 191.9 7.8 435.1 96.4 51.4 45 480.1

LIABILITIES & NET WORTH Accounts payable Debt due Accruals Current liabilities Long-term debt Common stock Retained earnings Total L&NW

53.8 10 19.7 83.5 60 150 55.8 349.3

54.7 10 26 90.7 50 150 82.8 373.5

86.2 10 24.7 120.9 40 180 114.6 455.5

84.2 10 26.1 120.3 30 180 149.8 480.1

Sales Cost of goods Gross margin Administrative Depreciation EBIT Interest EBT Taxes Net income

liquidity ratios current quick leverage ratios debt% times interest earned activity ratios inventory turnover fixed assets turnover total assets turnover average collection period day purchases outstanding (a profitability ratios gross margin net profit margin return on equity return on total assets operating margin ROE PN/A A/CPR DAT/A

1993

1994

1995

1996

3.8 2.4

3.7 2.4

3.4 1.8

3.6 2.0

41% 8.0

38% 8.5

35% 11.6

31% 15.7

8.4 30.0 2.8 56 26

8.6 29.3 2.8 55 25

6.4 30.1 2.7 51 33

6.8 29.0 2.7 62 31

24.0% 3.0% 14.3% 8.5% 6.8%

25.5% 2.6% 11.6% 7.2% 6.0%

24.9% 2.6% 10.8% 7.0% 5.8%

25.0% 2.7% 10.7% 7.3% 5.9%

8.45% 1.70 41.08%

7.23% 1.60 37.66%

6.99% 1.55 35.32%

7.32% 1.46 31.31%

Effective cost of passing up discounts price per share no of shares average price BV MBR

18.18% 55

65 5000 60 65.96 0.91

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