Question:
Haver Industries is a leading consumer products company. The company's adapted comparative balance sheets and income statements (in $ millions) follow.
Required
a. In his letters to shareholders in 2009, Haver's CEO stated that the company's goal for the next five years was to achieve 4 to 6% sales growth each year and at least 10% growth in earnings per share. Based on the results shown here, did the company meet its targets? How do you know?
b. Managing a broad collection of brands is challenging. In its 2009 annual report, Haver Industries stated that acquisitions and divestitures "are part of the Company's strategic focus on developing brands that offer the greatest potential for growth." The report went on, "This requires some difficult decisions, including a restructuring program to reduce overhead and streamline manufacturing processes." In other words, the company strives to use its assets to earn the greatest possible return. How well has the company managed its assets over the five-year period shown here?
c. Would you recommend Haver Industries shares to a friend who is interested in investing for growth potential? Why or whynot?
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Haver Industries Comparative Income Statement For the Years Ended December 31 2011 $68,222 $56,741 $51,407 $43,377 $40,238 26,331 1,802 14,702 2013 2012 2010 2009 Net sales revenue Cost of goods sold Gross profit Research & development 27,872 221219,249 28,869 22,141 20,989 35,097 2,075 19,773 Selling, general, & 16,460 346 834 9,981 3,058 12,052 administrative expenses Nonoperating income (expense) Interest expense Income before taxes Income taxes Net income 603 6,383 2,031 $ 8,684 6,923 6,481 5,186 4,352 $ 2.79 2.70 2.34 1.80 1.46 $ 1.15 1.03 0.93 0.82 0.76 12,413 3,729 9,350 2,869 Earnings per share Dividends per share Haver Industries Comparative Balance Sheet As of December 31 2013 2012 2011 2010 2009 Assets Cash Marketable securities Receivables Inventories Other current assets $ 6,693 6,389 4,232 5,912 300 3,427 4,185 5,006 3,005 329 4,062 4,400 2761 3,640 2,330 4,487 24,329 , Total current assets Property, plant, & 15,220 121 18,770 89027 3,569 14,332 13,349 equipment, net Intangibles Deposits & other assets 23,900 13,507 1,875 1,831 $135,695 $61,527 $57,048 $43,706 $40,776 Total Assets Liabilities Notes payable Accounts payable Current long-term debt Accrued expense Income taxes Other current liabilities 0 06,769 1,079 2,795 3,113 2,205 4,910 2,128 4,757 3,360 3,617 1,518 2,554 22,147 35,344 2,614 12,302 11,475 11,201 2,957 2,265 2,606 1,879 3,519 Total current liabilities Deferred charges Long-term debt Non-current capital leases Other long-term liabilities 25,039 12,358 12,354 Total liabilities 72,787 43,052 39,770 27,520 27,070 Stockholders' Equity Common stock 2,977 2,544 Stockholders' Equity Common stock Capital surplus Retained earnings Treasury stock Other 2,977 3,030 31,004 (34,235) 17,194) 3,976 57,856 35,666 2,544 2,425 13,611 1,297 2,931 13,692 0 1,301 2,490 11,980 0 0 55 1342) (1,302) (1.734) 2,065) Total stockholders 62,908 18,475 17,278 16,186 13,706 equity Total Liabilities & Stockholders' Equity $135,695 $61,527 $57,048 $43,706 $40,776