Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of D

Question

Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)

Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)

Using Rhodes Corporation's financial statements (shown above), answer the following questions.

What is the net operating profit after taxes (NOPAT) for 2015? 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.
2015 $ .... million
2014 $ .... 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.
2015 $ ..... million
2014 $ ..... million

What is the free cash flow for 2015? 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 2015? 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.

2015 2014 Sales $10,200.0 $8,500.0 Operating costs excluding depreciation 7,905.0 7,225.0 Depreciation and amortization 253.0 230.0 Earnings before interest and taxes $2,042.0 $1,045.0   Less: Interest 219.0 183.0 Pre-tax income $1,823.0 $862.0   Taxes (40%) 729.2 344.8 Net income available to common stockholders $1,093.8 $517.2 Common dividends $984.0 $414.0

Explanation / Answer

Net operating proft after taxes = Earnings before interest and tax*(1-tax rate)

=2042*(1-0.40) = $1225.20 million

2014 2015 Operating Current assets 128+1275+1870 3273 154+1530+1870 3554 Operating Current Liabilities 680+765 1445 748+880 1628 Net Operating working capital 1828 1926 Net operating capital = Net operating working capital + Net fixed assets 2014 2015 Net Operating working capital 1828 1926 Net Fixed Assets 2295 2525 Net operating capital 4123 4451 Free cash flow = Net operating profit after taxes - Net investment in operating capital 2015 Net Investment in operating capital = Operating capital 2015 - Operating capital 2014 4451-4123 328 $328 million 1225.20-328 897.2 $897.20 million ROIC = Net operating profit after taxes/Total net operating capital 1225.20/4451 27.53%

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