通用動(dòng)力公司和洛克希德馬丁公司
General Dynamics And Lockheed Martin

這種分析提供了一種比較兩個(gè)主要公司通用動(dòng)力公司和洛克希德馬丁公司在航空航天和國(guó)防工業(yè)的方法。通用動(dòng)力公司的ROE是25%而洛克希德·馬丁公司是49%。相比GD，以前有高于股權(quán)資本的成本的高傳播和產(chǎn)生高回報(bào)。GD產(chǎn)生更高的NOPAT保證金在航空航天(分別為9.4%和7.8%)允許GD ROE案件的判決結(jié)果作出更大貢獻(xiàn)的減少利息支出對(duì)凈利潤(rùn)和對(duì)總銷售收入的影響。以前有一個(gè)相當(dāng)大的優(yōu)勢(shì),,通過生成1.37美元每一美元相比GD的1.08美元每一美元花在公司資產(chǎn)上導(dǎo)致資產(chǎn)周轉(zhuǎn)率增加。通用動(dòng)力公司的股票非常低估(大約77.71美元的收盤價(jià)相比，57.79美元),而洛克希德·馬丁公司的股票有點(diǎn)高估(85.93美元的收盤價(jià)相比，84.08美元)。股票估值表明投資者過于樂觀在以前的收入潛力和悲觀GD的收入潛力。盡管估值,這個(gè)行業(yè)的命運(yùn)仍是依賴政府決定減少軍費(fèi)開支,這將對(duì)兩家公司產(chǎn)生負(fù)面影響。然而,商業(yè)航空公司的擴(kuò)張和伙伴關(guān)系與醫(yī)療行業(yè)將對(duì)這些企業(yè)有積極影響和整體這個(gè)行業(yè)將會(huì)有一個(gè)中立的結(jié)果在即將到來的一年。

通用動(dòng)力公司是世界上第六大國(guó)防承包商和公司專機(jī)的第二大手機(jī)制造商。公司維護(hù)四個(gè)業(yè)務(wù)集團(tuán)包括航空航天、戰(zhàn)斗系統(tǒng)、海洋系統(tǒng)和信息系統(tǒng)和技術(shù)。公司的凈收益從2006 - 2008年增加(1.86 - 2.46美元),三年增加了24%。銷售所有組從24.1美元增加到293億美元,從2006年到2008年,增長(zhǎng)了17%。

Financial Statement Analysis—— 財(cái)務(wù)報(bào)表分析

General Dynamics vs. Lockheed Martin——通用動(dòng)力公司和洛克希德馬丁公司

Executive Summary:——執(zhí)行概要

This analysis provides a comparison of two major companies within the Aerospace and Defense industry, General Dynamics and Lockheed Martin. General Dynamics had an ROE of 25% whereas Lockheed Martin was 49% demonstrating LMT has a higher spread and generated a higher amount of return above its cost of equity capital as compared to GD. GD generates a higher NOPAT margin over LMT (9.4% and 7.8%, respectively) allowing GD to contribute more to ROE as a result of the decreased effect interest expenses have on net income with respect to total sales revenue. LMT has a considerable advantage for generating increased asset turnover, by generating $1.37 for every dollar as compared to GD's $1.08 for every dollar spent on company assets. General Dynamics stock is extremely undervalued (estimated $77.71 compared to closing price of $57.79) whereas Lockheed Martin's stock was slightly overvalued ($85.93 compared to closing price of $84.08). Equity valuation indicates that investors were overly optimistic in LMT's earning potential and pessimistic for GD's earning potential. Despite the valuation, the destiny of this industry remains dependent on government's decisions to decrease military spending, which will have a negative impact on both companies. However, expansion of commercial airlines and partnerships with healthcare industries will have a positive effect on these companies and overall this industry will have a neutral outcome for the upcoming year.#p#分頁標(biāo)題#e#

General Dynamics (NYSE: GD)——通用動(dòng)力公司(NYSE:GD)

General Dynamics is the sixth largest defense contractor in the world and the second largest maker of corporate jets. The company maintains four business groups including aerospace, combat systems, marine systems and information systems and technology. Net earnings for the company increased from 2006-2008 ($1.86 to $2.46), a 24% increase over 3 years. Sales for all groups increased from $24.1 to $29.3 billion from 2006-2008, a 17% increase. The company is based in Virginia and gets 67% of its revenue from the Department of Defense.

The aerospace group generated $5.5 billion (19%) in sales in 2008, mostly due to Gulfstream business jet, which include long-range and ultra-long-range jets. In response to the downturn in the economy, the production of large-body and medium-size aircraft were reduced from 87 to 73 and 69 to 24, respectively, in 2008. In product development, Gulfstream introduced 2 additions, which are the ultra-large-cabin, ultra-long-range G650 and the super-mid-size G250. Production of both of these aircrafts, which enter into service in 2011 and 2012, are foreseeable income generators based on orders placed in 2008.

The combat systems group generated $8.2 billion (28%) in sales in 2008, mostly driven by demand for combat vehicles, specifically Mine-Resistant, Ambush-Protected (MRAP) vehicles. The combat system group makes, repairs and supports wheeled and tracked armored vehicles and munitions. Combat system product lines include combat vehicles, guns and ammunition systems, mobile bridge systems, armor, chemical, biological and explosion detection systems. Future opportunities include delivering hundreds of tanks and armored vehicles to Saudi Arabia between 2010 and 2012.

The marine systems group generated $5.6 billion (19%) in sales in 2008, extremely productive as compared to 2007. The group delivers destroyers, submarines, logistic ship and the first commercial product carrier. Upcoming contracts include doubling production to two submarines per year beginning in 2011, which is predicted to increase revenue and earnings over the next three years.

The information systems and technology generated $10 billion (34%) of sales in 2008; its biggest achievement developing a battlefield communications network program and Joint Tactical Radio System (JTRS). Customers include federal civilian agencies and commercial customers, which primarily focus on electronics for land, sea and air-based weapons systems. The acquisition of two companies in the tactical communications and healthcare information technology field are indicative of the direction this group will be making in the upcoming years.

Information gathered from Morningstar1.

Lockheed Martin (NYSE: LMT)——洛克希德馬丁公司(NYSE: LMT)

Lockheed Martin is the world's largest military weapons maker, deriving 84% of its net sales from the United States government, including the Department of Defense. The company is comprised of four operating systems including aeronautics, electronic, space and information systems and global services. Net sales increased 7.3% from 2006 to 2008 ($39.6 to $42.7 billion) and earnings increased 21.8% over three years ($2.5 to $3.2 billion). The company operates in Maryland and employs 146,000 people.#p#分頁標(biāo)題#e#

The aeronautics segment generated 27% of sales ($11.5 billion) in 2008. The segment's primary production are the F-35 Lightning II combat aircraft which is projected to be completed in 2010. The aeronautics segment is focused on making fighter jets and military transport planes and on unmanned military aircraft. The segment also operates the Global Sustainment enterprise to ensure success throughout the life cycle of its aircraft.

The electronics systems segment also generated 27% of sales in 2008 and primarily makes land, sea and air-based missiles and missile defense systems. Specifically, this segment is focused on maritime systems and sensors, missiles and fire control, and platform, training and energy. This system also manages and operates the Sandia National Laboratories for the US Department of Energy. Current projects include the Terminal Altitude Area Defense System (THAAD), the Ballistic Missile Defense system and the firehead control system for the Apache helicopter.

The space systems segment generated 19% of sales ($8.2 billion) in 2008. This segment is comprised of satellites, strategic and defensive missile systems, and space transportation systems. The US government customers accounted for 96% of this segment's sales in 2008. An ongoing partner is NASA; the LMT-built Phoenix Lander will continue to rove on Mars. Another venture is with Boeing, the United Launch Alliance, which provides satellite launch services to the US government.

Information systems and global services segment account for 27% of sales in 2008. This segment contains mission solutions, information systems and global services. The US government customers accounted for 93% of the segments sales in 2008. Major products/programs include communication systems, mission and combat support solutions, civil agency programs (US Census), the FAA Automated Flight Service Station, the FBI's Sentinel IT program, and various NASA programs.

Collaborations and partnerships with companies around the globe enable Lockheed Martin to grow its international business both with government and industry. The establishment of Lockheed Martin Australia in 2009 indicates an international interest to grow and expand.

Information gathered from Morningstar1.

Industry Outlook: Aerospace & Defense——行業(yè)前景:航空航天和國(guó)防

The aerospace and defense industry relies heavily on US government allocation and the upcoming year will likely bring budget cuts to the defense budget in 2010. However, there are predictions that the conventional military equipment is aging and once the Iraq war ends, there will be a need for repair and replacement. Due to the high levels of deficit spending and an increasing trend for social spending, it is likely there will be cuts in defense spending and the outlook for this industry will decline.

On the other hand, it is estimated that there will be an increased growth of global passenger air traffic in 2010 as compared to a decline in 2009. This is based on positive air traffic growth since comparison between 2009 and 2010. Aircrafts that are less fuel-efficient in the US will also need to be upgraded and replaced with newer aircraft. The industry predictions are moderate production cuts at Boeing and Airbus, and declines in the business jet markets due to falling corporate profits.#p#分頁標(biāo)題#e#

The industry outlook is therefore at a neutral rating, due to decreased military budget but increased commercial air traffic for 2010. Competition in the industry (Boeing, Northrop Grumman, Honeywell and Raytheon) will strive for contracts within the industry. Many of these defense contractors will face uncertainty from upcoming government decisions in the next year and hence the neutral outlook for this industry.

Information gathered from Morningstar and S&P500 Industry Reports——收集的信息從晨星公司和標(biāo)準(zhǔn)普爾工業(yè)報(bào)告

Financial Statement Adjustments——財(cái)務(wù)報(bào)表的調(diào)整

The following table contains information on the cumulative adjustment to General Dynamics' and Lockheed Martin's financial Statements.

Adjustments
General Dynamics
Lockheed Martin

Income Statement——損益表

· Increase Net Income by $19 million from loss from discontinued operations net of tax

· Increase Net Income by $196 million from deferred portion of income tax
· Decrease Net Income by $70 million for gain on sale of LKEI and ILS net of tax

· Decrease Net Income by $56 million for gain on land sale

· Increase Net Income by $215 million to reverse impairment charge (215 = 314(1-.316)

· Increase Net Income by $72 million to unwind deferred taxes

· Subtract $246 million from Net Income for Pension Income

Balance Sheet——資產(chǎn)負(fù)債表

· Increase assets by 75% of PV of capitalized leases ($709 million)

· Decrease assets by $7 million to unwind taxes (DTA)

· Adjustments for LIFO reserve not added to Total Assets. Added in denominator of ITR and Current Asset in Current Ratio

· Added 100% of PV of capitalization of leases to Total Liabilities ($946 million)

· Subtracted 25% of PV of capitalized leases to SE ($236 million)

· Decrease SE by $7 million to unwind deferred taxes effect (-DTA; +DTL)
· Increase assets by 75% of PV of capitalized leases ($699 million)

· Decrease assets by $5,390 million to unwind deferred taxes (DTA)

· Increase liabilities by 100% of PV of capitalized leases ($932 million)

· Decrease SE by 25% of PV of operating leases ($233 million)

· Decrease SE by $5,390 million to unwind deferred tax (-DTA; +DTL)

Caveats——注意事項(xiàng)

· Termination of A-12 program in 1991 is an unlikely contingency of $690 and is currently on appeal in the Appeals Court.

Cost of Equity Capital——權(quán)益資本成本

Historically, LMT common stock has proven less sensitive to the broad stock market. With a beta of .923 and using the Capital Asset Pricing Model (CAPM), LMT investors require an annual rate of return of 10.2%. Although this is lower than the expected market return of 10.8% (see appendix for calculation and assumptions), it is greater than its industry (Guided Missile & Space Vehicles) expected return of 8.7%. However, although LMT may be more volatile as a stock than its competitors, it enjoyed a Return on Equity (ROE) significantly higher than the industry average.#p#分頁標(biāo)題#e#

In 2008, LMT had an ROE of 49.2% while the industry followed with a 23.4% average ROE. Just as significant and telling is the comparison of LMT's ROE to its own required rate of return. This spread of 39% is an impressive sign as it demonstrates the amount of return LMT generated above its cost of equity capital. This is also impressive to investors at first glance, and will warrant a deeper interest from prospective investors.

Much the same can be said for GD when comparing its required rate of return to its ROE. Although the spread was only 12.9%, it is still a good sign that GD generates such a return above its cost of equity.

However, unlike LMT GD has a beta greater than 1 and is therefore more sensitive to stock market moves; and has an expected return less than its industry return by approximately 1.25%.

NOPAT Margin——NOPAT保證金

When we analyze the potential net income in the absence of debt, NOPAT, we observe that General Dynamics (9.4%) generates a higher margin over Lockheed Martin (7.8%), which allows General Dynamics to contribute more to ROE in comparison to Lockheed Martin as a result of the decreased effect interest expenses have on net income with respect to total sales revenue. However, when comparing NOPAT performance to the rest of their industry (Ship & Boat Building & Repair), General Dynamics' comes in slightly below the 9.9% average that was established for 2008, but does not necessarily signify any under-performance in this area since the industry data only takes into account two firms when generating Industry NOPAT margin averages. Lockheed Martin was similarly compared to Industry data, generated by two firms as well, in which NOPAT margins were recorded that were more than double of what was found for similarly classified companies (Guided Missiles & Space Vehicles - 3.69%).

Asset Turnover——資產(chǎn)周轉(zhuǎn)率

This portion of the ROE evaluates the efficiency to produce revenue based on the investment in assets made by the company. When we begin to evaluate the simplified Asset TO values provided by the multiplicative decomposition of ROE, we observe a noticeable advantage by Lockheed Martin since they reportedly generate $1.37 for every $1.00 spent on assets. General Dynamics generate slightly lower values at $1.08 for every $1.00 spent on company assets. We then continued to analyze Asset TO, now based on the additive decomposition of ROE to see how other variables affect the turnover rates. When this approach is taken, average assets for both companies in 2008 needed to be adjusted, and was done so by pulling out all non-interest bearing liabilities (NIBL). This is where we noticed that NIBL's for Lockheed Martin ($20,742) were 62.8% higher than those reported by General Dynamics ($12,735). As a result, the Asset TO ratios increased significantly for both companies (LMT - 2.05 and GD - 4.09) with respect to assets dollars invested by each company. As we can observe, unexpected losses in each company's pension fund had led them to classify their losses as liabilities since they will still needed to be accounted for in the near future. The 32% drop in the fair value of the LMT pension fund ($27,259 down to $18,539) in 2008 and the 35% drop in the fair value of the GD pension fund ($7,452 down to $4,823)was felt somewhat more extensively by LMT, since the higher amount lost reflects LMT's larger workforce of 140,000 employees. GD, although enduring a similar percentage drop in fund value, only accommodates a workforce of 91,000, and therefore lost less in overall value amount.#p#分頁標(biāo)題#e#

Leverage——資金槓桿

When we analyze leverage, we are analyzing each company's ability and efficiency in using interest bearing debt to generate revenue. The higher the leverage value, the better the ability of a company is at using invested funds (IBL's) to obtain desired revenues. When evaluating LMT's and GD's effect of leverage as a result of their 2008 results, we observe that the numbers generated by LMT (0.17) are over three times higher than those generated by GD (0.05) during the same time period. As we continue to drill down into the effect of leverage, we notice that ROA is also higher for LMT as a result of the large variation in NIBL's between the two companies. Although a higher leverage effect value may indicate that LMT relies more on interest bearing debt to generate more sales revenue, an analysis of interest bearing liabilities for both LMT and GD was performed based on data available at the end of 2007 and 2008. This analysis revealed that LMT had reduced their interest bearing liabilities ($4,407 down to $3,805) while GD, whom recorded a smaller leverage effect, had done the opposite and showed to have increased their interest bearing liabilities ($2,791 increased to $4,024) by the end of 2008.

Selected Ratio Comparison:——選擇比率比較
Accounts Receivable Days

General Dynamics
Industry
Lockheed Martin
Industry

39.51
32.50
43.62
57.12

From the results presented above, General Dynamics demonstrates that it under-performed the rest of the industry by exceeding the average account receivable days by 7 days. In contrast, Lockheed Martin out-performed the rest of its industry by having recorded an account receivable average of 43.62 days, which means LMT was collecting from customers on an average of 13.5 days ahead of the rest of the industry.

Accounts Payable Days——應(yīng)付賬款的日子
General Dynamics
Industry
Lockheed Martin
Industry

33.88
31.50
20.09
19.66

- GD is collecting from customers on average over 2 days past the industry average of 31.50 days

- LMT is collecting just ½ day over the industry average of 19.66 days

Inventory Days——存貨周轉(zhuǎn)天數(shù)
General Dynamics
Industry
Lockheed Martin
Industry

25.97
56.62
17.35
13.55

- GD is turning inventory on average over 30 days under the industry average of 56.62 days

- LMT is turning inventory on average over 3 days over the industry average of 13.55 days

Interest Coverage

General Dynamics
Industry
Lockheed Martin
Industry

29.57
30.43
14.49
5.49

- GD could cover its yearly interest expenses 29.57 times in 2008, just under its industry average of 30.43 times#p#分頁標(biāo)題#e#

- LMT could cover its yearly interest expenses 29.57 times in 2008, significantly over its industry average of 5.49 times

Equity Valuation——股權(quán)估值

The equity valuation of General Dynamics for 2008 produced an estimated share price of $77.71. This price is significantly higher than the closing per-share price of $57.59 for 2008 showing the company's stock was extremely undervalued. According to analyst reports5, some concerns about growth for General Dynamics stem from shrinking credit markets, which would impair the ability to finance business jets. Additionally, it is possible that investors were concerned the aerospace and defense industry would decline with a shift from government defense spending to social spending and deficit spending.

Abnormal net income was computed as predicted net income less the cost of equity capital. Predicted net income was computed using 2008 pro forma net income of $2,674 and implementing annual growth rates suggested by Goldman Sachs earnings forecasts5. The growth rates from 2009 through 2013 were -2.9%, 7.3%, 5.2%, 7.3% and 7.8% respectively. The same earnings forecasts were used to calculate the predicted dividends. The predicted dividends from 2009 to 2013 are 577, 617, 643, 671 and 700 respectively. The terminal value assumption used in computing abnormal net income was the competitive equilibrium on incremental real sales assumption. This strategy was chosen because the government is one of General Dynamics' most significant customers, comprising approximately 67% of the company's revenue. This lead to the assumption that General Dynamics may not need to invest a large amount of resources in developing new customers and that most of their future growth would be lead by existing customers. This assumption provided a terminal value of $21,999. The cost of capital for General Dynamics was calculated using a beta of 1.119, a risk free rate of 5% and a market risk premium of 4%. This produced a cost of capital of 9.5%. The present value of abnormal net income was calculated to be $20,265, by dividing abnormal net income by a discounting factor derived using the cost of capital.

The present value of abnormal net income was combined with the initial book value of $9,810 to produce an estimated predicted price of $30,075. This price was divided by the number of shares outstanding according to the 2008 annual report to arrive at an estimated share price of $77.71.

The equity valuation for Lockheed Martin for 2008 produced an estimated share price of $85.93, which is slightly higher than the actual share price as of the end of 2008 of $84.08. This shows the stock was slightly overvalued. This shows investors may have been overly optimistic in their opinion of Lockheed Martin's earnings potential.

Abnormal net income was computed just as that of General Dynamics. Using analysts' reports6, estimated (negative) growth rates of (6%), (7%), (6.6%), 11% and 8.92% were applied to the 2008 pro forma net income of $3,114. The same terminal value assumption was used for Lockheed Martin as was used for General Dynamics. The US government is a substantial customer of Lockheed Martin's, which lead to the assumption that a large portion of future growth could be attributed to existing customers and few resources could be devoted to developing new customers. The terminal value assumption provided a terminal value of $41,132. The cost of equity capital was calculated using a beta of .923, a risk free rate of 4% and a market risk premium of 5%. The 8.7% cost of capital was used to find the present value of abnormal net income of $37.936. This present value was combined with an initial book value of ($2,758) to produce an estimated price of $35,178. The estimated price divided by the number of shares outstanding per the Lockheed Martin annual report to arrive at a per-share price of $85.93.#p#分頁標(biāo)題#e#

References:——參考文獻(xiàn)

 

Richard Safran, Noah Poponak, Goldman Sachs, January 26, 2009. Noah Poponak, Chun-Yai Wang, Sai Krishna, Goldman Sachs, January 27, 2010
Richard Safran, Noah Poponak, Goldman Sachs, January 22, 2009. Noah Poponak, Chun-Yai Wang, Sai Krishna, Goldman Sachs, January 29, 2010

APPENDIX——附錄

CAPM = Rf Rate + (Beta*Rmrkt)
Given Data
Risk Free rate = 3.77% (10 Year Treasury as of 2/18/10)
Market Premium (Rmrkt) = 7% (given on page 26 of class notes)

LMT Beta =
0.923
Industry Beta =
0.697
GD Beta =
1.119
Industry Beta =
1.298
CAPM Calculations
LMT = .0377 + .923*.07
LMT =
10.23%
Industry = .0377 + .697*.07
Industry =
8.65%

GD = .0377 + 1.119*.07
GD =
11.60%
Industry = .0377 + 1.298*.07
Industry =
12.86%

Financial Statement Analysis——財(cái)務(wù)報(bào)表分析

GD
LMT

2008
2008

Beginning assets
25,733
28,926

Ending assets
28,373
33,439

Beginning equity
11,768
9,805

Ending equity
10,053
2,865

Beginning interest-bearing liabilities
2,791
4,407

Ending interest-bearing liabilities
4,024
3,805

Net income (pro forma)
2,674
3,114

Sales revenue
29,300
42,731

Other revenue
0
0

Research & development expense
474
1,220

Selling, general & administrative expense
1,700
2,344

Income tax expense
1,126
1,485

Income tax rate
0.31
0.32

Interest expense
133
341

Beginning inventory
1,621
1,718

Ending inventory
2,029
1,902

Cost of goods sold
25,647
38,082

Beginning accounts receivable
2,874
4,925

Ending accounts receivable
3,469
5,296

Beginning accounts payable
2,318
2,163

Ending accounts payable
2,443
2,030

Shares outstanding
386
393

Closing price per share
57.59
84.08
bloomberg.com

Average assets
27,053
31,183

Average equity
10,911
6,335

Average interest-bearing liabilities
3,408
4,106

Average non-interest bearing liabilities
12,735
20,742

#p#分頁標(biāo)題#e#

Average accounts receivable
3,172
5,111

Average inventory
1,825
1,810

Average accounts payable
2,381
2,097

After-tax interest rate
0.03
0.06

Multiplicative Decomposition of ROE

ROE
0.25
0.49

Net profit margin
0.09
0.07

Asset turnover
1.08
1.37

Leverage
2.48
4.92

Additive Decomposition of ROE

ROE
0.25
0.49

Market-to-book
2.21
11.53

NOPAT Margin
0.09
0.08

Asset turnover
2.05
4.09

ROA
0.19
0.32

Spread
0.17
0.26

Leverage
0.31
0.65

Effect of leverage
0.05
0.17

Gross profit margin
0.12
0.11
R&D to revenue
0.02
0.03
SG&A to revenue
0.06
0.05
Accounts receivable days
39.51
43.65
Inventory days
25.97
17.35
Operating cycle
65.48
61.00

Accounts payable days
33.88
20.09

Cash-to-cash cycle
31.60
40.91

Interest coverage
29.57
14.49

Debt ratio
0.65
0.91

Appendix C:——附錄C
General Dynamics
Lockheed Martin
Financial Statement Adjustments

Cumulative Financial Statement Adjustments
Summary of Income Statement Adjustments
Summary of Income Statement Adjustments
Net Income as Reported:
$ 2,459
Net Income as Reported:
$ 3,217
Discontinued operations
19
Loss on sale of property,
(126)
Unwind tax effects
196
land, & equipment
Adjusted Net Income
$ 2,674
Reverse of Impairment charge
215

Unwind tax effects
72

Pension Income
(264)

Adjusted Net Income
$ 3,114

Summary of Balance Sheet Adjustments
Summary of Balance Sheet Adjustments
Total Assets as reported
$ 28,373
Total Assets as reported $ 33,439
Constructive capitalization of
709
Constructive capitalization
699
operating leases
of operating leases
Unwind tax effects (DTA)
(7)
Unwind tax effects (DTA)
(5,390)
Adjusted Total Assets
$ 29,075
Adjusted Total Assets
$ 28,748

Total Liabilities as reported
$ 18,320
Total Liabilities as reported
$ 30,574
Constructive capitalization
946
Constructive capitalization
932
of operating leases
of operating leases
Adjusted Total Liabilities#p#分頁標(biāo)題#e#
$ 19,266
Adjusted Total Liabilities
$ 31,506
Total SE as reported
$ 10,053
Total SE as reported
$ 2,865
Constructive capitalization
(236)
Constructive capitalization

of operating leases
(233)
of operating leases
Unwind tax effects
(5,390)
Unwind tax effects
(7)
(DTA+DTL)
(DTA+DTL)
Adjusted Total SE
$ (2,758)
Adjusted Total SE
$ 9,810
Adjusted Total Liabilities + SE
$ 29,075
Adjusted Total Liabilities + SE
$ 28,748

General Dynamics——通用動(dòng)力

Pension Income Pro Forma Calculation——養(yǎng)老金收入形式上的計(jì)算

1
Net pension cost (benefit)
$ 20

Net postretirement plan cost
56

Total cost
$ 76

Net earnings
$ 2,459

Percentage
3.1%

2008
2007

2
Funded status pensions
$ (2,922)
$ 383

Funded status other postretirement plans
(640)
(642)

Total funded status
(3,562)
(259)

Difference
$ (3,303)

3
Rate of return on U.S. plan assets
8.1%

Expected return
593

Implied asset base
7,330
= 592 / .081

Actual return percentage
-32.20%
= 2360 / 7330

4
Implied asset base
$ 7,330

Pro forma expected rate
7.0%
Given

Pro forma expected return
513

Less: Original expected return
(593)

Difference (reduction in pension income)
(80)

1 - Effective tax rate
68.8%
=1-.312

Adjustment (reduction) to net income
$ (55)

OR: [(.081-.070)*7,330] * (1-.312) =
$ 55

Adjusted income
$ 2,404
= 2,459 - 55

Lockheed Martin

Pension Income Pro Forma Calculation

1
Net pension cost (benefit)
$ 462

Net postretirement plan cost
46

Total cost
$ 508

Net earnings
$ 3,217

Percentage
15.8%

2008
2007

2
Funded status pensions
$ (11,882)
$ (879)

Funded status other postretirement plans
1426
2017

Total funded status
(10,456)
1,138

Difference
$ (11,594)

3
Rate of return on U.S. plan assets
8.5%

Expected return
$ 2,184

Implied asset base
25,694
= 2184 / .085

Actual return percentage
-28.62%
= 7354 / 25694

4#p#分頁標(biāo)題#e#
Implied asset base
$ 25,694

Pro forma expected rate
7.0%
Given

Pro forma expected return
1,799

Less: Original expected return
(2,184)

Difference (reduction in pension income)
(385)

1 - Effective tax rate
68.4%
=1-.316

Adjustment (reduction) to net income
$ (264)
Adjusted income
$ 2,953
= 3,217 - 264

General Dynamics

Capitalization of Operating Leases——資本化經(jīng)營(yíng)租賃

Enter interest rate below:

0.039

Enter operating lease commitments below (in millions):

2009
205.0

2010
174.0

2011
131.0

2012
97.0

2013
70.0

2014 & thereafter
405.0

Solution: Present value of operating lease commitments
$ 945.9

Calculation of Present Value of Operating Lease Payments:

0
205.0
1.000
205.0

1
174.0
1.039
167.5

2
131.0
1.080
121.3

3
97.0
1.122
86.5

4
70.0
405.0
1.166
60.1

5
70.0
335.0
1.211
57.8

6
70.0
265.0
1.258
55.6

7
70.0
195.0
1.307
53.5

8
70
125
1.358
52

9
70
55
1.411
50

PV of operating lease commitments
946

 

Total Assets (increased by….)
$ 709.5

Total Shareholders Equity (decreased by….)
$ (236.5)

Total Liabilities (increased by…..)
$ 945.9

Lockheed Martin

Capitalization of Operating Leases

Enter interest rate below:

0.083

Enter operating lease commitments below (in millions):

2009
262.0

2010
223.0

2011
184.0

2012
148.0

2013
114.0

2014 & thereafter
165.0

Solution: Present value of operating lease commitments
$ 932.2

Calculation of Present Value of Operating Lease Payments:

0
262.0
1.000
262.0

1
223.0
1.083
205.9

2
184.0
1.173
156.9

3
148.0
1.270
116.5

4
114.0
165.0
1.376
82.9

5
114.0
51.0
1.490
76.5

6
51.0
0.0
1.614
31.6

7
0.0
0.0
1.748
0.0#p#分頁標(biāo)題#e#

8
0
0
1.893
0

9
0
0
2.050
0

PV of operating lease commitments
932

Total Assets (increased by….)
$ 699.2

Total Shareholders Equity (decreased by….)
$ (233.1)

Total Liabilities (increased by…..)
$ 932.2
4