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    Flash Memory Excel

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    Harshita Sethiya
    Flash Memory, Inc. provides income statements for 2007-2009 and projected estimates for 2010-2012. Net sales increased each year from $77 million in 2007 to an estimated $144 million in 2012. Gross margins ranged from $12.6-$16.8 million over this period. Net income grew from $2.3 million in 2007 to a projected $3.8 million in 2012, while EPS increased from $1.52 to an estimated $2.56 over the same period.

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    Flash Memory Excel

    Uploaded by

    Harshita Sethiya
    167 views4 pages
    Flash Memory, Inc. provides income statements for 2007-2009 and projected estimates for 2010-2012. Net sales increased each year from $77 million in 2007 to an estimated $144 million in 2012. Gross margins ranged from $12.6-$16.8 million over this period. Net income grew from $2.3 million in 2007 to a projected $3.8 million in 2012, while EPS increased from $1.52 to an estimated $2.56 over the same period.

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    Flash Memory excel

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    Flash Memory, Inc. provides income statements for 2007-2009 and projected estimates for 2010-2012. Net sales increased each year from $77 million in 2007 to an estimated $144 million in 2012. Gross margins ranged from $12.6-$16.8 million over this period. Net income grew from $2.3 million in 2007 to a projected $3.8 million in 2012, while EPS increased from $1.52 to an estimated $2.56 over the same period.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    167 views4 pages

    Flash Memory Excel

    Uploaded by

    Harshita Sethiya
    Flash Memory, Inc. provides income statements for 2007-2009 and projected estimates for 2010-2012. Net sales increased each year from $77 million in 2007 to an estimated $144 million in 2012. Gross margins ranged from $12.6-$16.8 million over this period. Net income grew from $2.3 million in 2007 to a projected $3.8 million in 2012, while EPS increased from $1.52 to an estimated $2.56 over the same period.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 4

    Flash Memory, Inc.

    Exhibit 1 Income Statements, 2007 - 2009 ($000s except earnings per share)

    2007 2008 2009 2010E 2011E 2012E

    Net sales $77,131 $80,953 $89,250 $120,000 $144,000 $144,000


    Cost of goods sold $62,519 $68,382 $72,424 $97,320 $116,784 $116,784
    Gross margin $14,612 $12,571 $16,826 $22,680 $27,216 $27,216

    Research and development $3,726 $4,133 $4,416 $6,000 $7,200 $7,200


    Selling, general and administrative $6,594 $7,536 $7,458 $10,032 $12,038 $12,038
    Operating income $4,292 $902 $4,952 $6,648 $7,978 $7,978

    Interest expense $480 $652 $735 $937 $1,323 $1,565


    Other income (expenses) -$39 -$27 -$35 -$50 -$50 -$50

    Income before income taxes $3,773 $223 $4,182 $5,661 $6,604 $6,363

    Income taxes (a) $1,509 $89 $1,673 $2,264 $2,642 $2,545


    Net income $2,264 $134 $2,509 $3,396 $3,963 $3,818

    Earnings per share $1.52 $0.09 $1.68 $2.28 $2.66 $2.56

    (a) In years 2007 and after, Flash's effective combined federal and state income tax rate was 40%.

    Assumptions
    COGS as % of sales 81.06% 84.47% 81.15% 81.10% 81.10% 81.10%
    Research and development as % of sales 4.83% 5.11% 4.95% 5.00% 5.00% 5.00%
    SGA as % of sales 8.55% 9.31% 8.36% 8.36% 8.36% 8.36%
    Flash Memory, Inc.

    Exhibit 2 Balance Sheets, 2007 - 2009 ($000s except number of shares outstanding)

    December 31, December 31,


    2007 2008 2009 2010E 2011E 2012E

    Cash $2,536 $2,218 $2,934 $3,960 $4,752 $4,752


    Accounts receivable $10,988 $12,864 $14,671 $19,726 $23,671 $23,671
    Inventories $9,592 $11,072 $11,509 $13,865 $16,638 $16,638
    Prepaid expenses $309 $324 $357 $480 $576 $576
    Total current assets $23,425 $26,478 $29,471 $38,031 $45,637 $45,637

    Property, plant & equipment at cost $5,306 $6,116 $7,282 $8,182 $9,082 $9,982
    Less: Accumulated depreciation $792 $1,174 $1,633 $2,179 $2,793 $3,474
    Net property, plant & equipment $4,514 $4,942 $5,649 $6,003 $6,289 $6,508

    Total assets $27,939 $31,420 $35,120 $44,034 $51,926 $52,145

    Accounts payable $3,084 $4,268 $3,929 $4,799 $5,759 $5,759


    Notes payable (a) $6,620 $8,873 $10,132 $14,305 $16,914 $13,324
    Accrued expenses $563 $591 $652 $876 $1,051 $1,051
    Income taxes payable (b) $151 $9 $167 $226 $264 $255
    Other current liabilities $478 $502 $554 $744 $893 $893
    Total current liabilities $10,896 $14,243 $15,434 $20,951 $24,881 $21,282

    Common stock at par value $15 $15 $15 $15 $15 $15
    Paid in capital in excess of par value $7,980 $7,980 $7,980 $7,980 $7,980 $7,980
    Retained earnings $9,048 $9,182 $11,691 $15,087 $19,050 $22,868
    Total shareholders' equity $17,043 $17,177 $19,686 $23,082 $27,045 $30,863

    Total liabilities & shareholders' equity $27,939 $31,420 $35,120 $44,033 $51,926 $52,145
    Balance Sheet Check $0 $0 $0 $0 $0 $0
    Number of shares outstanding 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662

    (a) Secured by accounts receivable.


    (b) To avoid a penalty for underpayment of income taxes, Flash made equal estimated tax payments quarterly on the 15th of
    April, June, September, and December of each year. The total of these four quarterly payments was required to equal at
    least the lesser of (a) 90% of the taxes that would actually be incurred in the same year, or (b) 100% of the taxes due
    on income of the prior year.

    For informational purposes only:

    Notes payable / accounts receivable 60.2% 69.0% 69.1%


    Notes payable / shareholders' equity 38.8% 51.7% 51.5%
    Notes payable / total capital 28.0% 34.1% 34.0%
    Flash Memory, Inc.

    Exhibit 3 Key Forecasting Assumptions and Relationships for 2010 Through 2012

    Line Item Assumption or Ratio

    Cost of goods sold 81.10% of sales


    Research and development 5.0% of sales
    Selling, general and administrative 8.36% of sales
    Interest expense Beginning of year debt balance × interest rate
    Other income (expenses) $50,000 of expense each year

    Cash 3.3% of sales


    Accounts receivable 60 days sales outstanding
    Inventories 52 days of cost of good sold
    Prepaid expenses 0.4% of sales
    Property, plant & equipment at cost Beginning PP&E at cost + capital expenditures
    Accumulated depreciation Beginning A/D + 7.5% of beginning PP&E at cost

    Accounts payable 30 days of purchases


    Purchases 60% of cost of goods sold
    Accrued expenses 0.73% of sales
    Income taxes payable 10% of income taxes expense
    Other current liabilities 0.62% of sales
    Flash Memory, Inc.

    Exhibit 4 Selected Financial Information for Flash Memory, Inc., and Selected Competitors, 2007 through 2009

    Flash Memory, Inc. Micron Technology


    2007 2008 2009 30-Apr-10 (a) 2007 2008 2009 30-Apr-10 (a)

    Sales ($ millions) 77 81 89 120 5,688 5,841 4,803


    EPS ($) 1.52 0.09 1.68 2.28 -0.42 -2.10 -2.29 1.46
    Dividend per share ($) -- -- -- -- -- -- --
    Closing stock price ($) n/a n/a n/a n/a 7.25 2.64 10.56 9.35
    Shares outstanding (millions) 1.492 1.492 1.492 1.492 769.1 772.5 800.7 847.6
    Book Value per share ($) 11.43 11.52 13.20 15.47 10.08 8.00 5.81 6.61
    ROE 13.28% 0.78% 12.75% 14.71% -4.13% -26.21% -39.43% 21.00%
    Capitalization (book value)
    Debt 28% 34% 34% 38% 24% 31% 40% 33%
    Equity 72% 66% 66% 62% 76% 69% 60% 67%
    Beta coefficient n/a 1.25

    SanDisk Corporation STEC, Inc.

    Sales ($ millions) 3,986 3,351 3,567 189 227 354


    EPS ($) 0.84 -8.82 1.83 3.71 0.20 0.09 1.47 1.29
    Dividend per share ($) -- -- -- -- -- --
    Closing stock price ($) 33.17 9.60 28.99 39.84 8.74 4.26 16.34 13.90
    Shares outstanding (millions) 227.7 225.3 227.4 229.3 49.8 50.0 49.4 50.3
    Book Value per share ($) 22.64 15.27 17.18 18.13 3.72 3.63 5.65 5.48
    ROE 3.70% -57.74% 10.63% 17.87% 5.40% 2.36% 26.06% 18.90%
    Capitalization (book value)
    Debt 15% 22% 21% 19% 0% 0% 0% 0%
    Equity 85% 78% 79% 81% 100% 100% 100% 100%
    Beta coefficient 1.36 1.00

    (a) Security analyst estimates for year-end EPS $ and Return on Equity; actual data on April 30, 2010, for all other items.

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