HOGS income statement forecasts
Sales –29% growth in 2010, 24% in 2011 from
analyst report. Trend to 3% after that.
CGS/Sales –hold margins constant. With rapidly
growing market, less competitive pressure on
taxes. 0% on chilled and frozen,25% on prepared
interest –5.3% from footnote
is CGS/Sales sensitive to changing
pig prices?
depreciation rate
Useful life is then .80(20) + .20(50) = 26 year useful life.
NOA–constant or changing?
Balance Sheet Assumptions
Working Capital Assumptions
Ending Operating Cash/Sales
Ending Receivables/Sales
Ending Inventories/COGS
Ending Other Current Assets/Sales
Ending Accounts Payable/COGS
Ending Taxes Payable/Sales
Ending Other Current Liabs/Sales
Other Operating Asset Assumptions
Ending Net PP&E/Sales
Ending Investments/Sales
Ending Intangibles/Sales
Ending Other Assets/Sales
HOGS balance sheet forecasts
Trend Cash/Sales from 12% to 3%
don’t seem to be earnings interest rev, so this looks like
a temporary cash balance due to large capital
offerings
need to maintain restricted cash w bank. 3% of 2009
HOGS PPE/Sales forecast
From analyst report:
“As shown in Exhibit 1, processing capacity should
increase 41% from now to the end of 2012. Besides
capacity expansion efforts, Zhongpin should be
able to increase capacity utilization over time. Over
the last three years, capacity utilization has been