See Table 2.5 showing financial statement data and stock price data for Mydeco Corp. Suppose Mydeco repurchases 18 million shares each year from 2013–2016. What would be its earnings per share in 2016?

 

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TABLE 2.5 Mydeco Corp. 2012-2016 (All data as of fiscal year end; $ in millions) 2012-2016 Financial Income Statement 2012 2013 2014 2015 2016 Statement Data and Revenue 404.3 363.8 424.6 510.7 604.1 Stock Price Data for Mydeco Corp. Cost of Goods Sold (188.3) (173.8) (206.2) (246.8) (293.4) Gross Profit 215.9 190.0 218.3 263.9 310.7 Sales and Marketing (66.7) (66.4) (82.8) (102.1) (66.4) (120.8) Administration (60.6) (59.1) (59.4) (78.5) Depreciation & Amortization (27.3) (27.0) (34.3) (38.4) (38.6) EBIT 61.3 37.4 41.8 57.0 72.8 Interest Income (Expense) (33.7) (32.9) (32.2) (37.4) (39.4) Pretax Income 27.7 4.5 9.6 19.6 33.4 Income Tax (9.7) (1.6) (3.4) (6.9) (11.7) Net Income 18.0 2.9 6.2 12.7 21.7 Shares Outstanding (millions) 55.0 55.0 55.0 55.0 55.0 Earnings per Share $0.33 $0.05 S0.11 $0.23 $0.39 Balance Sheet 2012 2013 2014 2015 2016 Assets Cash 48.8 68.8 86.2 77.4 84.9 Accounts Receivable 88.6 69.8 69.8 76.9 86.1 Inventory 33.7 30.9 28.4 31.7 35.3 Total Current Assets 171.1 169.4 184.4 186.1 206.3 243.2 345.5 Net Property, Plant, & Equipment 245.3 308.9 347.0 Goodwill & Intangibles 361.7 361.7 361.7 361.7 361.7 Total Assets 778.1 774.3 855.0 893.3 914.9 (Continued) TABLE 2.5 Mydeco Corp. 2012-2016 (All data as of fiscal year end; $ in millions) 2012-2016 Financial Income Statement 2012 2013 2014 2015 2016 Statement Data and Revenue 404.3 363.8 424.6 510.7 604.1 Stock Price Data for Mydeco Corp. Cost of Goods Sold (188.3) (173.8) (206.2) (246.8) (293.4) Gross Profit 215.9 190.0 218.3 263.9 310.7 Sales and Marketing (66.7) (66.4) (82.8) (102.1) (66.4) (120.8) Administration (60.6) (59.1) (59.4) (78.5) Depreciation & Amortization (27.3) (27.0) (34.3) (38.4) (38.6) EBIT 61.3 37.4 41.8 57.0 72.8 Interest Income (Expense) (33.7) (32.9) (32.2) (37.4) (39.4) Pretax Income 27.7 4.5 9.6 19.6 33.4 Income Tax (9.7) (1.6) (3.4) (6.9) (11.7) Net Income 18.0 2.9 6.2 12.7 21.7 Shares Outstanding (millions) 55.0 55.0 55.0 55.0 55.0 Earnings per Share $0.33 $0.05 S0.11 $0.23 $0.39 Balance Sheet 2012 2013 2014 2015 2016 Assets Cash 48.8 68.8 86.2 77.4 84.9 Accounts Receivable 88.6 69.8 69.8 76.9 86.1 Inventory 33.7 30.9 28.4 31.7 35.3 Total Current Assets 171.1 169.4 184.4 186.1 206.3 243.2 345.5 Net Property, Plant, & Equipment 245.3 308.9 347.0 Goodwill & Intangibles 361.7 361.7 361.7 361.7 361.7 Total Assets 778.1 774.3 855.0 893.3 914.9 (Continued)

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A share repurchase is a transaction whereby a company buys back its own shares from the marketp... View the full answer