teuer Furniture

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These spreadsheet exhibits relate to the case Teuer Furniture (A): Discounted Cash Flow Valuati #KEL778.

2015 by the Kello !chool o" a$ae%e$t at &orth'ester$ ($i)ersity. This case 'as prepared

*ro"essor itchell +. *eterse$. Teer -r$itre is a "ictio$al co%pa$y 'hose pro"ile 'as created bdata "ro% real i$dstry leaders. Cases are de)eloped solely as the basis "or class discssio$. Cai$te$ded to ser)e as e$dorse%e$ts, sorces o" pri%ary data, or illstratio$s o" e""ecti)e or i$e""ect%a$ae%e$t. To order copies or reest per%issio$ to reprodce %aterials, call 800/55/785 o700 otside the ($ited !tates or Ca$ada4 or e/%ail cstser)hbsp.har)ard.ed. &o part o" this%ay be reprodced, stored i$ a retrie)al syste%, sed i$ a spreadsheet, or tra$s%itted i$ a$y "or%ea$s6electro$ic, %echa$ical, photocopyi$, recordi$, or other'ise6'ithot the per%issio$ oCase *blishi$.


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n, Case

by

ased o$es are $oti)er 17/783/

pblicatio$or by a$yKello


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All values in 000's

Income Statement 2013 2014

Sales 169,039 185,641

COGS 71,284 78,545

Expenses 55,983 61,438

Depreciation 1,405 2,032

Taxes 16,147 17,450

Net !nco"e 24,220 26,175

Balance Sheet 2013 2014

#oo$ %al&e o' ((E 3,948 5,447

)cco&nts *ecei%a+le 54,831 60,216

!n%entor 33,904 37,357

)cco&nts (aa+le 11,642 12,828

)ccr&e- Expenses 2,691 2,953

Cash Flow 2013 2014

Net !nco"e 24,220 26,175

Depreciation 1,405 2,032

C.an/e in )cco&nts *ecei%a+le 6,632 5,385

C.an/e in !n%entor 561 3,453C.an/e in )cco&nts (aa+le 279 1,186

C.an/e in )ccr&e- Expenses 1,008 262


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2015 2016 2017 201

203,152 217,132 228,072 236,569

84,799 89,209 91,996 93,961

66,463 69,851 72,539 74,750

2,786 2,735 2,346 1,997

19,642 22,134 24,476 26,345

29,462 33,202 36,714 39,517

2015 2016 2017 201

7,180 5,297 3,320 2,036

65,897 70,431 73,980 76,736 32

40,332 42,429 43,755 44,690 48

13,849 14,570 15,025 15,346 16

3,194 3,357 3,486 3,592 48

2015 2016 2017 201

29,462 33,202 36,714 39,517

2,786 2,735 2,346 1,997

5,680 4,535 3,549 2,756

2,974 2,098 1,326 9351,021 720 455 321

242 163 129 106


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Sales!in 000"s# 2012 2013 2014

2003 6,034 6,235 6,430

2004 17,869 18,464 19,041

2005 24,499 25,315 26,108

2006 34,824 35,984 37,110

2007 43,541 44,991 46,399

2008 9,257 9,683 9,986

2009 3,540 4,001 4,176

2010 5,300 6,707 7,564

2011 3,354 4,610 5,823

2012 5,379 9,428 12,935

2013 0 3,622 6,337

2014 0 0 3,731

2015 0 0 0

Total (ales 1%#,%97 19,0#9 18%,1

C$%S !in 000"s# 2012 2013 2014

2003 2,416 2,476 2,554

2004 7,176 7,333 7,563

2005 9,042 10,055 10,369

2006 13,932 14,292 14,739

2007 17,856 17,870 18,4292008 3,764 3,846 3,966

2009 1,887 1,589 1,659

2010 3 526 2 664 3 004


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2015 0 0 0

Total ()A e*pense 22,292 2#,810 2,2#%

&'(ertisin) !in 000"s# 2012 2013 2014

2003 457 447 461

2004 1,287 1,323 1,364

2005 1,793 1,813 1,870

2006 2,287 2,577 2,658

2007 3,109 3,223 3,323

2008 675 694 715

2009 303 287 299

2010 473 480 542

2011 358 377 417

2012 569 838 1,058

2013 0 383 563

2014 0 0 395

2015 0 0 0

Total A+vertisin e*pense 11,#1# 12,1 1#,%

*ease !in 000"s# 2012 2013 2014

2003 302 302 302

2004 1,003 1,003 1,003

2005 1,510 1,510 1,510

2006 1,910 2,203 2,2032007 2,530 2,530 2,824

2008 610 610 610

2009 280 280 280


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2015 2016 2017 201

6,618 6,799 6,971 7,133 :ear

19,599 20,134 20,643 21,123 1

26,872 27,605 28,303 28,962 2

38,197 39,239 40,231 41,167 3

47,758 49,061 50,301 51,472 4

10,278 10,559 10,825 11,077 5

4,299 4,416 4,527 4,633 6

7,881 8,096 8,301 8,494

6,555 6,816 6,988 7,151

16,305 18,319 19,012 19,454

8,677 10,917 12,241 12,679

6,514 8,903 11,179 12,510

3,597 6,268 8,549 10,714

20#,1%2 217,1#2 228,072 2#,%9

2015 2016 2017 201

2,629 2,700 2,769 2,833 :ear

7,784 7,997 8,199 8,390 1

10,673 10,964 11,242 11,503 2

15,171 15,585 15,979 16,351 3

18,969 19,486 19,979 20,444 44,082 4,194 4,300 4,400

1,707 1,754 1,798 1,840

3 130 3 216 3 297 3 374


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695 1,148 1,478 1,457

28,0 #0,1%2 #1,##1 #2,171

2015 2016 2017 201

474 487 499 511 :ear

1,404 1,442 1,479 1,513 1

1,925 1,977 2,027 2,074 2

2,736 2,811 2,882 2,949 3

3,421 3,514 3,603 3,687 4

736 756 775 793

308 316 324 332

565 580 595 608

469 488 501 512

1,168 1,312 1,362 1,393

709 782 877 908

579 728 801 896

381 557 699 767

1,87 1%,7%1 1,2# 1,9%

2015 2016 2017 201

302 381 381 381 :ear

1,003 1,003 1,193 1,193 2012

1,510 1,510 1,510 1,706 2013

2,203 2,203 2,203 2,203 20142,824 2,824 2,824 2,824 2015

673 673 673 673 2016

280 321 321 321 2017


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Grot. *ate o' sales 2012

70 2013

33 2014

23 2015

97

15 :ear

03 2013

2014

2015

2016

2017

2018

COGS as o' sales

71

64

56

40


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)-%ertisin/ as o' sales

11

89

82

72

;ease per s


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Sales per s


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Grot. rate o' lease per s


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+ear ,o of stores S-uare foot o.ene'

2003 1 172002004 3 17600

2005 4 18500

2006 5 21100

2007 6 22100

2008 2 15500

2009 1 14500

2010 2 147002011 2 15400

2012 3 16300

2013 2 16000

2014 2 16000

2015 2 15000

2016 0 0

2017 0 02018 0 0

In/ation 2003 2004

2003 19 51

2004 332005

2006

2007


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efresh cost

2003 358 0

2004 1,175 0

2005 1,814 0

2006 2,971 0

2007 4,058 0

2008 924 0

2009 394 0

2010 752 0

2011 798 307

2012 1,293 1,021

2013 860 1,598

2014 876 2,655

2015 837 3,682

2016 0 852

2017 0 369

2018 0 713

Boo (alue of Ca.e!in 000"s#

ConstructionCost


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70&

Construction cost .er s- feet Construction Cost !in 000"s# efresh Cost !in 000"s#

208 358223 1,175

245 1,814

282 2,971

306 4,058

298 924

272 394

256 752259 798 307

264 1,293 1,021

269 860 1,598

274 876 2,655

279 837 3,682

0 852

0 369

0 713

2005 2006 2007

86 111 152

67 92 13334 60 100

25 66

4 1


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e.reciation Boo (alue

72 286

307 1,155

669 2,299

1,264 4,007

2,075 5,990

2,188 4,725

2,032 3,087

1,820 2,019

1,447 1,677

1,098 2,894

1,405 3,948

2,032 5,447

2,786 7,180

2,735 5,297

2,346 3,320

1,997 2,036


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otal Ca.e !in 000"s# 2003 2004 2005 2006 2007

358 72 72 72 72 721,175 235 235 235 235

1,814 363 363 363

2,971 594 594

4,058 812

924

394

7521,105

2,314

2,459

3,531

4,519

852

369

713

Total 72 #07 9 1,2 2,07%

200 200 2010 2011 2012 2013 2014

153 180 195 224 242 259 277

134 161 176 206 223 240 258101 129 143 173 190 207 225

67 94 109 139 156 173 191

4 2 6 9 8 4 11 4 13 1 14 8 16 6


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/epreciation

200 200 2010 2011 2012 2013 2014 2015

235

363 363

594 594 594

812 812 812 812

185 185 185 185 185

79 79 79 79 79

150 150 150 150 150221 221 221 221 221

463 463 463 463

492 492 492

706 706

904

2,188 2,0#2 1,820 1,7 1,098 1,0% 2,0#2 2,78

2015 2016 2017 201 201

296 317 336 354 372

277 298 317 335 353

245 266 285 303 321

211 232 251 269 287

18 5 20 6 22 5 24 3 26 1


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2016 2017 201

463

492 492

706 706 706

904 904 904

170 170 170

74 74

143

2,7#% 2,# 1,997


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hiit 18 euer Furnitures Showrooms an' S-uare Foota)e

Stores Total S= T Total

Opene- Stores Opene- S= T

2003 1 1 17,200 17,200

2004 3 4 17,600 70,000

2005 4 8 18,500 144,000

2006 5 13 21,100 249,500

2007 6 19 22,100 382,100

2008 2 21 15,500 413,100

2009 1 22 14,500 427,6002010 2 24 14,700 457,000

2011 2 26 15,400 487,800

2012 3 29 16,300 536,700

2013 2 31 16,000 568,700

2014 2 33 16,000 600,700

2015 2 35 15,000 630,700 2000

5

10

15

20

25

30

35

40


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3 2005 2007 2009 2011 2013 2015

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

N&"+er o' S.oroo"s Total S


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euer Furniture 9ro Forma Income Statement2012 2013 2014 2015 2016 2017 2018 2019

Sales 148,218

CGS 61,955

SG) exc a-% > -ep 21,253

)-%ertisin/ 10,744

Depreciation 1,450

;ease stores 9,320

Corp Expense inc lease?a-% 7,411

Taxes 14,434

Net inco"e 21,651

9arameters8

Corporate tax rate 40

Corporate expenses 5


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hiit 8 Forecastin) Sales e(enue an' Costs:ear 1 2 3 4 5 6 7 8

Sales /rot. 2003 736 346 195 151 02 12 10

2004 729 292 214 81 36 34 00

2005 766 326 222 78 37 31

2006 738 288 244 113 132007 645 368 261 63

2008 605 356 236

2009 690 366

2010 704

2011

)%era/e 702 335 229 97 15 03

:ear 1 2 3 4 5 6 7 8

CGS 2003 711 615 578 389 434 420 389 366

2004 713 624 521 438 390 412 387 402

2005 729 656 578 406 411 403 369

2006 701 531 576 333 389 400

2007 726 673 539 384 410

2008 644 670 610 407

2009 710 659 533

2010 740 665

2011 703

)%era/e 709 637 562 397

:ear 1 2 3 4 5 6 7 8

SG) 2003 199 171 164 139 129 139 136 117

2004 176 180 174 141 145 137 139 130

2005 204 179 170 145 132 132 151

2006 204 190 180 127 144 142

2007 198 176 180 130 136

2008 164 184 169 134

2009 179 192 174


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2010 207 194

2011 209

)%era/e 193 183 173 136

:ear 1 2 3 4 5 6 7 8

)-%ertisin/ 2003 99 89 76 71 67 77 69 68

2004 103 82 83 74 80 77 72 72

2005 109 89 80 76 70 67 73

2006 103 84 83 68 68 66

2007 102 90 81 69 71

2008 102 96 83 73

2009 110 91 86

2010 117 89

2011 107

)%era/e 106 89 82 72


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9

06

9

400

9

131


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9

76


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hiit 28 conomic In'icators8 %9 an' Furniture Sales %rowth2002 2003 2004 2005 2006 2007 2008 2009 2

C(! in-ex 1809 1843 1903 1968 2018 2100 2102 2159 21 !nation C(! 19 33 34 25 41 01 27 1

GD( T@ 10,642 11,142 11,853 12,623 13,377 14,029 14,292 13,974 14,

GD( /rot. 47 64 65 60 49 19 22 3

&rnit&re sales @# 9444 967 1038 1091 1128 1111 996 863 8

&rnit&re sales /rot. 24 73 52 34 15 104 134 1

2003 2005 2007 2009 2011 2013

150

100

50

00

50

100

GD( Grot. &rnit&re Sales Grot. !nation C(


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hiit 38 euer Furniture Income Statement2003 2004 2005 2006 2007 2008 2009 2010

Sales 2,057 10,415 26,701 51,540 79,191 90,680 111,451 1

Cost o' /oo-s sol- 1,463 7,057 17,424 30,730 43,834 47,290 49,068 Sellin/, /eneral an- a-"in 410 1,812 4,958 9,230 13,576 14,679 16,471

)-%ertisin/ 203 1,019 2,411 4,588 6,585 7,532 8,367

Depreciation 72 307 669 1,264 2,075 2,188 2,032

;ease 250 1,080 2,330 4,240 6,770 7,380 7,712

Corporate expense 185 729 1,602 3,092 4,751 5,441 5,573

Taxes 0 0 0 0 0 543 8,892

Net inco"e 526 1,588 2,693 1,604 1,600 5,626 13,337

(ara"etersA



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hiit 48 euer Furniture Balance Sheet2003 2004 2005 2006 2007 2008 2009 2010 20

&ssets

)cco&nts *ecei%a+le 0 751 3,479 8,675 16,946 25,272 29,059 36,625 42,4

!n%entor 671 3,151 8,216 15,125 20,908 21,715 24,868 26,808 2 9,2

Total C&rrent )ssets 671 3,902 11,695 23,800 37,853 46,987 53,927 63,433 71,6((E 358 1,461 2,969 5,270 8,065 6,914 5,119 3,839 3,

Total )ssets 1,029 5,364 14,663 29,070 45,918 53,900 59,046 67,272 74,7

*iailities an' -uit:

)cco&nts (aa+le 236 1,158 2,781 5,119 7,228 7,767 8,277 9,133 9,9

)ccr&e- Expenses 29 145 358 658 958 1,055 1,203 1,359 1,5

Total C&rrent ;ia+ilities 265 1,303 3,139 5,777 8,186 8,822 9,480 10,493 11,5

De+t 0 0 0 0 0 0 0 0

E


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hiit 58 euer Furniture Income Statement for In'i(i'ual ShB )%/ Sie 2004 2005 2006 2007 2008 200

2003 1 17,200 1 2 3 4 5

Sales 2,057 3,754 5,224 6,148 6,341 5,50

CGS 1,463 2,309 3,018 2,394 2,753 2,31SG) 410 640 857 856 815 76

)-%ertisin/ 203 334 399 434 422 42

Depreciation 72 72 72 72 72

;ease 250 250 250 250 250 25

2004 3 17,600 1 2 3 4

Sales 6,661 11,907 15,158 16,488 15,44

CGS 4,748 7,428 7,894 7,216 6,03

SG) 1,171 2,148 2,631 2,323 2,23 )-%ertisin/ 685 971 1,266 1,213 1,23

Depreciation 235 235 235 235 23

;ease 830 830 830 830 83

2005 4 18,500 1 2 3

Sales 9,570 16,651 19,785 20,95

CGS 6,978 10,917 11,430 8,49

SG) 1,953 2,977 3,371 3,03

)-%ertisin/ 1,041 1,488 1,587 1,59

Depreciation 363 363 363 36

;ease 1,250 1,250 1,250 1,25


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hiit 68 euer Furniture Balance Sheet for In'i(i'ual ShowroomsB )%/ Sie 2003 2004 2005 2006 2007 2008 2009 2010

2003 1 17,200 0 1 2 3 4 5 6 7 Cap expen-it&re 358

)ccts recei%a+le 751 1,187 1,665 1,975 2,040 1,700 1,745

!n%entor 671 1,090 1,330 1,206 1,167 980 972 1,082

)ccts paa+le 236 396 448 405 403 350 345 370

)ccr expenses 29 49 62 61 61 53 54 57

2004 3 17,600 0 1 2 3 4 5 6

Cap expen-it&re 1,175

)ccts recei%a+le 2,292 3,870 5,029 5,526 5,276 5,599

!n%entor 2,061 3,590 4,304 3,352 2,851 3,042 3,248

)ccts paa+le 762 1,255 1,421 1,124 1,025 1,090 1,124

)ccr expenses 95 158 193 173 162 162 175

2005 4 18,500 0 1 2 3 4 5


)ccts recei%a+le 3,140 5,508 6,296 6,231 7,149

!n%entor 3,296 5,271 4,640 3,975 4,075 4,427

)ccts paa+le 1,078 1,760 1,742 1,381 1,523 1,572

)ccr expenses 138 212 240 203 240 244

2006 5 21,100 0 1 2 3 4


)ccts recei%a+le 4,433 6,593 7,974 10,040 1!n%entor 4,344 6,518 6,635 5,870 6,689

)ccts paa+le 1,533 2,227 2,181 1,889 2,165

)ccr expenses 193 272 300 291 337


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Cap expen-it&re 394

)ccts recei%a+le 484

!n%entor 488 882)ccts paa+le 171 261

)ccr expenses 21 34

2010 2 14,700 0

Cap expen-it&re 752

)ccts recei%a+le

!n%entor 1,013

)ccts paa+le 348

)ccr expenses 44

2011 2 15,400

Cap expen-it&re

)ccts recei%a+le

!n%entor

)ccts paa+le )ccr expenses

2012 3 16,300

Cap expen-it&re

)ccts recei%a+le

!n%entor

)ccts paa+le

)ccr expenses

2013 2 16,000


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)ccts paa+le

)ccr expenses

Cap expen-it&re

)ccts recei%a+le

!n%entor

)ccts paa+le

)ccr expenses


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hiit 78 euer Furniture Cash Flow &ssets2003 2004 2005 2006 2007 2008 2009

Sales 2,057 10,415 26,701 51,540 79,191 90,680

Costs 2,582 12,003 29,394 53,144 77,591 84,510

Taxes 0 0 0 0 0 543

Net inco"e 0 526 1,588 2,693 1,604 1,600 5,626 Capital expen-it&re 358 1,175 1,814 2,971 4,058 924 394

Depreciation 0 72 307 669 1,264 2,075 2,188

!ncrease in NC 406 2,193 5,957 9,467 11,645 8,498 6,281

Cas. o to assets 764 3,823 9,052 14,461 16,043 5,747 1,139


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2010 2011 2012

111,451 134,093 148,218

89,222 100,704 112,132

8,892 13,356 14,434

13,337 20,033 21,651752 1,122 2,229

2,032 1,820 1,450

8,494 7,192 8,365

6,123 13,539 12,508


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hiit 8 Forecastin) In(estment:ear 1 2 3 4 5 6 7 8

)cco&nts *ecei%a+le 2003 365 316 319 321 322 309 310 297

2004 344 325 332 335 342 346 325 319

2005 328 331 318 297 313 317 324

2006 326 312 338 338 320 3382007 312 310 323 313 320

2008 329 340 305 314

2009 337 335 336

2010 318 337

2011 326

)%era/e 324

:ear 1 2 3 4 5 6 7 8

!n%entor 2003 459 472 440 504 424 424 443 503

2004 434 483 545 464 473 456 485 473

2005 472 483 406 468 434 449 482

2006 456 580 488 593 504 492

2007 467 422 530 481 455

2008 501 494 486 459

2009 478 534 467

2010 455 507

2011 453

)%era/e 476

:ear 1 2 3 4 5 6 7 8

)cco&nts (aa+le 2003 161 172 148 169 146 152 157 172

2004 161 169 180 156 170 163 168 159

2005 154 161 152 162 162 159 173

2006 161 198 160 191 163 167

2007 155 168 165 173 152

2008 170 158 150 156

2009 168 158 173


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2010 156 164

2011 164

)%era/e 163

:ear 1 2 3 4 5 6 7 8

)ccr&e- Expenses 2003 47 51 49 47 49 45 46 52

2004 51 51 49 49 47 47 48 49

2005 46 47 48 44 52 50 46

2006 46 47 48 50 47 47

2007 46 50 46 48 48

2008 51 50 48 49

2009 52 48 47

2010 45 47

2011 44

)%era/e 48

No"inal *eal

Constr&ction costs 2003 208 259

2004 223 268

2005 245 286

2006 282 320

2007 306 335

2008 298 326

2009 272 289

2010 256 2682011 259 264

2012 264 264

2013 269 264

2014 274 264

2015 279 264

No"inal *eal


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*e'res. cost 2003 906 740

2004 796 660

)%era/e 700


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9

315

9

425

9

153


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9

47


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hiit 108 Forecastin) 9arameters1 2 3 4 5 6 7

Sales /rot. 702 335 229

CGS sales 709 637 562 397

SG) sales, excl&-in/ -ep > a-%ertisin/ 193 183 173 136

)-%ertisin/ sales 106 89 82 72

)cco&nts *ecei%a+le sales 324

!n%entor next earFs CGS 476

)cco&nts (aa+le next earFs CGS 163

)ccr&e- expenses next earFs SG) a-% 48

Depreciation ears 5

*e'res. cost 700



Disco&nt rate 121

;on/ter" /rot. rate 35S.ares o&tstan-in/ 9,945


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euer Furniture 9ro Forma Income Statement2012 2013 2014 2015 2016 2017 2018 2019

Sales 148,218

CGS 61,955

SG) exc a-% > -ep 21,253

)-%ertisin/ 10,744

Depreciation 1,450;ease stores 9,320

Corp Expense inc lease?a-% 7,411

Taxes 14,434

Net inco"e 21,651

9arameters8




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euer Furniture 9ro Forma Balance Sheet2012 2013 2014 2015 2016 2017 2018

&ssets

)cco&nts *ecei%a+le 48,200

!n%entor 33,343

Total C&rrent )ssets 81,543

((E 3,920

Total )ssets 85,463

*iailities an' -uit:

)cco&nts (aa+le 11,364

)ccr&e- Expenses 1,682

Total C&rrent ;ia+ilities 13,046

De+t 0

E


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euer Furniture 9ro Forma Cash Flow &ssets2012 2013 2014 2015 2016 2017

Sales 148,218

Costs 112,132

Taxes 14,434

Net inco"e 21,651

Capital expen-it&re 2,229

Depreciation 1,450

!ncrease in NC 8,365

Cas. o assets 12,508

Ter"inal %al&e

)sset %al&e

S.are %al&e

9arameters8

)sset -isco&nt rate 121

;on/ter" /rot. rate 35

S.are.ol-ers B 187

S.ares o&tstan-in/ 9,945


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2018

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teuer Furniture