本文是金融专业的留学生Essay范例,题目是“Financial Analysis Of Hampton Machine Tool Company(汉普顿机床公司财务分析)”汉普顿机床公司,一个机床制造商,成立于1915年。直到1979年,公司已经成功地预测了行业严重的周期性波动特征。该公司的主要客户群包括圣路易斯地区的飞机和汽车制造商。在20世纪60年代中后期,汉普顿由于强大的汽车市场,以及与越南战争相关的巨额国防开支,利润非常丰厚。然而,在20世纪70年代中期,随着美国从越南战争和石油禁运中撤出,汉普顿的盈利速度放缓。到20世纪70年代末,由于他们的竞争对手无法度过这段艰难时期,他们在市场上占有了更大的份额,而汉普顿设法稳定下来。
Introduction:介绍
Hampton Machine Tool Company, a machine tool manufacturer, was founded in 1915. Until 1979, the company had successfully forecasted the severe cyclical fluctuations characteristic of the industry. The company’s primary customer base included the aircraft and automobile manufacturers in the St. Louis area. During the mid – to late 1960s, Hampton was very profitable due to a strong automobile market, and, to the heavy defense spending associated with the Vietnam War. However, in the mid-1970s, Hampton’s profitability slowed down with the United States’ withdrawal from Vietnam War and the oil embargo. By the late 1970s, they had a larger share in the market due to their competitors who were unable to make it through these difficult times, while Hampton managed to stabilize.
Case Background:案例背景:
Ten years prior to December, 1978, the company had no debt because it had conservative financial policies, which maintained a strong working capital position as a buffer against economic uncertainty. In December,1978, Hampton requested a $1 million loan from the St. Louis National Bank. The loan’s terms were a monthly interest payment at a rate of 1.5%, with the principal to be paid back at the end of September, 1979. Now (September of 1979), Benjamin G. Cowins, president of Hampton, has asked to renew the initial loan until end of 1979, and, has requested an additional loan of $350,000 with promise of repayment at the end of December, 1979 with an interest rate of 1.5% per month. This additional loan is required for an update of their machinery which hasn’t been done since the economy went into a recession in the early 1970s.
在1978年12月之前的10年,该公司没有债务,因为它有保守的财务政策,这保持了强大的营运资本头寸,作为对经济不确定性的缓冲。1978年12月,汉普顿向圣路易斯国家银行申请了100万美元的贷款。该贷款的条件是每月支付1.5%的利息,并在1979年9月底偿还本金。现在(1979年9月),本杰明·g·考恩斯,汉普顿的总裁,要求将最初的贷款延长到1979年底,并要求额外贷款35万美元,承诺在1979年12月底偿还,利率为每月1.5%。这些额外的贷款是为了更新他们的机器而需要的,自从20世纪70年代早期经济陷入衰退以来,他们就没有这样做过。
For the last several months, Hampton’s shipment schedule has been upset because they have had to wait for parts from their suppliers. On August 31, the accumulation of seven machines cost about $1,320,000, in addition to the installation cost for these parts. They received the parts last week, and will be able to complete a number of machines within next few weeks. The reduction in work in progress of about $1,320,000 is due to not receiving the electronic control mechanisms on time. However, the remainder of their work in progress inventories will probably remain steady for the foreseeable future because of their capacity rate of production.
In July and August, Hampton bought raw materials beyond their immediate needs to be assured of completing their order schedule to be shipped by the end of the year. Therefore, they currently have accumulated about $420,000 worth of scarcer components above their normal raw materials inventories. They estimate it will be used by the end of the year. Because they bought ahead this way, they expect to cut raw material purchases to about $600,000 a month in each of the four remaining months of 1979.
在7月和8月,汉普顿购买了超出他们当前需求的原材料,以确保完成他们的订单计划,并在年底发货。因此,他们目前已经积累了价值约42万美元的稀有部件,超过了正常的原材料库存。他们估计它将在年底使用。由于他们以这种方式提前购买,他们预计在1979年剩下的四个月里,每个月的原材料采购将减少到大约60万美元。
The company’s revised shipment estimates are: September, $2,163,000; October, $1,505,000; November $1,604,000; December, $2,265,000. The shipment estimates include a $2,100,000 order for the General Aircraft Corporation. Hampton is now scheduled to ship against this order as follows: September, $840,000; October, $840,000; November, $420,000. Because General Aircraft gave Hampton an advance payment of $1,566,000 on this order, the company will be due nothing on these shipments until their $1,566,000 credit with Hampton is exhausted.
该公司修正后的出货预估为:9月份,216.3万美元;10月,1505000美元;11月1604000美元;12月,2265000美元。这批货物中包括通用飞机公司210万美元的订单。汉普顿现在计划根据这个订单出货如下:9月,$84万;10月,840000美元;11月,420000美元。因为通用航空公司在这张订单上给了汉普顿156.6万美元的预付款,所以该公司在汉普顿的156.6万美元信用到期之前不会对这些货物进行任何支付。
Hampton’s assuming accruals will remain about the same on August 31, and their monthly outlay for all expenses other than interest and raw materials purchases should be around $400,000 per month. Due to poor economic conditions and the company’s desire to conserve cash; they have spent little on new equipment in the last several years, 1979. This has contributed somewhat to the difficulties they have had in maintaining production at full capacity this year. As a result, Hampton has requested an additional $350,000 loan at an interest rate of 1.5% monthly, with promise of repayment at the end of December, 1979. This loan is necessary to purchase certain needed equipment to maintain the production. The tax people estimated the equipment will qualify for a 10% investment tax credit. The company is scheduled to pay $181,000 in taxes on September 15 and December 15. Also, Mr. Cowins has suggested paying $150,000 dividends to stockholders in December.
Analysis:分析
The Hampton Machine Tool Company is facing problems in paying its $1 million loan and requesting for a new loan from the St. Louis National Bank. By following Mr. Cowins’ plan, the company will be short $332,000 (Exhibit 1) in December. Hampton, a profitable firm, has fallen behind on their orders, and Mr. Cowins recommends that they need more financing to purchase certain needed equipment. Hampton has notified the St. Louis National Bank that they will not be able to repay in September. Also, they have requested an extension. For the past month or more, Hampton has been operating at full capacity, and with additional back orders, which has put them behind in their shipment of orders. In addition, their shipment schedule has been upset because they have been waiting for electronic control mechanisms from their suppliers. The falling behind has also caused them to have less than what is needed for accounts receivables turnover.
汉普顿机床公司在支付100万美元贷款和向圣路易斯国家银行申请新贷款方面面临问题。按照考恩斯的计划,该公司将在12月少赚33.2万美元(证据1)。汉普顿是一家盈利的公司,但他们的订单却落后了。考文斯建议,他们需要更多的资金来购买某些必要的设备。汉普顿已经通知圣路易斯国家银行,他们将无法在9月份偿还贷款。另外,他们要求延期。在过去的一个多月里,汉普顿一直在满负荷运转,而且还有额外的延期订单,这使得他们无法按时发货。此外,由于他们一直在等待供应商提供的电子控制装置,所以他们的发货时间表被打乱了。落后也导致他们的应收账款周转不足。
The cash budgets and statement of sources and uses yield negative results concerning the principal payment of the loan for December (Exhibit 1), based on Mr. Cowins’ plan. This analysis is based on projected sales, dividend payments and tax payments. Consequently, the sales projects and accounts receivables are 30 days net; if not paid on time, then this could change the results significantly by putting the company in more of a financial bind. Based on my forecasts it seems that Mr. Cowins is incorrect about being able to repay the loan in December, but Hampton should be able to repay in January with more precise planning.
Hampton used the initial loan plus $2 million in excess cash to repurchase a substantial fraction of its outstanding common stock, because it had decreased sufficiently in value. Although they had good intentions to increase the company’s stock value, their finances have suffered because of the repurchase. Mr. Cowins’ offer to pay $150,000 in dividends in December is not reasonable, because Hampton’s finances will suffer, causing them to have negative cash flows. (Exhibit 1)
汉普顿用最初的贷款加上200万美元多余的现金回购了相当大一部分未偿普通股,因为这些股票的价值已经降到了足够低的水平。虽然他们有提高公司股票价值的良好意图,但他们的财务状况因回购而受到影响。考文斯提出在12月支付15万美元股息,这是不合理的,因为汉普顿的财务状况将受到影响,导致现金流为负。(表1)
Recommendation:推荐:
It is obvious that Hampton cannot afford to repay the loan in December, if they proceed with their original plans. The company will have a negative cash flow in December according to Exhibit 1. They should request a one-month extension on the loan, as they cannot afford to make a loan payment in December. Extending the loan repayment one month until January allows for account receivables of December to become collected, because of the company collection policy of 30 days net. This means Hampton will not have to go into the negative to pay the loan in December, keeping cash flow at an expectable level which is $1,168.50. (Exhibit 2)
很明显,汉普顿无法在12月偿还贷款,如果他们继续他们原来的计划。根据表1,公司在12月将有负的现金流。如果到12月份还不起贷款,就应该要求延期一个月。将贷款偿还期限延长一个月至1月份,可以收回12月份的应收账款,因为公司的收回政策是30天的净额。这意味着汉普顿在12月不必为偿还贷款而进入负值,将现金流保持在1,168.50美元的预期水平。(表2)
Hampton cannot afford to make a dividend payment in December, regardless of their willingness to do so. Canceling the dividend payment will free up $150,000 in December, keeping the net cash flow in the positive (Exhibit 2), which compensates for the $350,000 loan payment. This also helps keep the net cash flow positive in December, as well as waiting for accounts receivables of $2,265,000 to come in January for the final payment. This makes the company profitable for the future, and, in turn, the stock will not become valueless.
Conclusion:结论
My recommendation for Hampton Machine Tool Company is they should request a one month extension on the loan, and cancel the dividend payment to make the company more profitable. Also, this would strengthen Hampton’s relationship with the bank by paying off both loans.
我对汉普顿机床公司的建议是,他们应该要求延期一个月的贷款,并取消股息支付,使公司更有利可图。此外,这将加强汉普顿与银行的关系,偿还两笔贷款。
Based on the forecasted cash budget, Mr. Jerry Eckwood, vice-president of the St. Louis National Bank, should reject the $350,000 loan request based on the current terms proposed by Hampton Machine Tool Company. According to Exhibit 1, there is an inability to repay the initial loan. The numbers fall short of being able to repay the original loan in December without even considering the requested loan. However, with the proper financial adjustments, both loans can be fully repaid by January. For relationship reasons, Mr. Eckwood may want to grant the loan, as long as the terms are reworked to help guarantee, that the bank will get paid. The extension of the loan and cancelation dividends will leave Hampton in a manageable situation, allowing them to continue to be a profitable customer of the bank. The St. Louis National Bank should bring up the solutions that I mentioned above, but Mr. Eckwood will want to make sure that the bank puts Hampton on a repayment plan, so, that in the near future they can expect to collect the principal of the outstanding loans.
If I was the St. Louis National Bank, I would have to reject the loan on the current terms proposed by Mr. Cowins, because the Hampton Machine Tool Company shows an inability to repay the loan, based on the numbers they have forecast.
如果我是圣路易斯国家银行(St. Louis National Bank),我将不得不根据考恩斯先生提出的当前条款拒绝贷款,因为根据他们预测的数字,汉普顿机床公司(Hampton Machine Tool Company)显示出无力偿还贷款。
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