eskimo pie case 2006

8/9/2019 Eskimo Pie Case 2006

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J. K. Dietrich - FBE 532 Spring 2006

Eskimo Pie Cse

Jn!r" #$% 2006


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Bsic Steps to

&'!tion in Finnce Estimte csh ('o)s Csh - (ter t*% cons!m+'e

Sometimes es" ,(i*e incomes% sometimes hr

,resi!' c'ims Choose isco!nt rte

opport!nit" rte on 'ternti/e

risk !ste

C'c!'te present /'!e n net present /'!e n

ecie i( )orth more thn costs


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1pte Estimtes in &'!tionEskimo Pie Profit/Cashflow '91 92 93Sales $61.0 64.9$ 65.7$

!erati"# E!e"ses 41.4 44.7 45.2

S%& 15.( 16.( 17.0

!. Profit $3.( $3.5 $3.5)ree Cash )low $2.7 $2.5 $2.5

*et +",ome $2.3 $2.1 2.1$

%rowth '90-91 29.2 6.4 1.2

)C) $2.7 $2.5 $50.76

P 15.5

Cash

otal ale

$37.2

$13.0

$50.2


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Eskimo Pie Cost o( Cpit'Com!a" Eit otal et E/8 Eit eta sset eta

e" & :err's 110.1 2.( 0.9( 1.2 1.17

reer's %ra"; +,e Cream 534.0 44.3 0.92 1.4 1.29

Em!ire of Caroli"a< +",. 51.4 (9.( 0.36 0.3 0.11

Ste=e's >omema;e +,e Crea 37.4 3.1 0.92 2.5 2.31

>ershe )oo;s Cor!. 4002.5 2(2.9 0.93 1.0 0.93ootsie ?oll +";s. 72(.( 0.0 1.00 1.0 1.00

=era#e 0.(5 1.23 1.14

%0.15%2.9*14.1%56.4WACCfrTS

=

%9.15%4.7*14.1%42.7WACCfrTL

=

Estimated WACC using s!rt"term and #!ng"term Treasuries4


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&'!tions !ner &r"ing tes

%rowth @ 10 12 14

is,o"t ?ate

14 121.0$ 246.4$ --

15 96.($ 164.3$ 535.(

16 (0.7$ 123.2$ 267.9

17 69.1$ 9(.6$ 17(.6

ss!ming 7.7 mi''ion ss!me in the cse FCF ,7 8 .7 gro)s

in perpet!it" n omits #3 mi''ion in e*cess csh /i'+'e (or

p"ment to +!"ers


7/10J. K. Dietrich - FBE 532 Spring 2006

&'!tion 1sing Compr+'esCom!a" 8/ PE 8/S /C)

Ben & Jerry's 4.19 29.76 1.16 16.85

Dreyer's Grand Ice Cream 4.72 33.58 1.63 24.00

Empre !" Car!#na$ Inc. 1.14 5.84 0.58 8.40

%ee's (!memade Ice Cream 3.37 20.78 1.15 15.00

(ers)ey *!!ds C!rp. 3.00 18.23 1.48 14.66+!!se ,!## Inds. 4.77 28.58 3.51 22.42

-erae 3.53 22.80 1.59 16.89

*+ Sales )C)

Esmae "!r Es/m! e 1991 21.80 2.3 61 2.7

a#a!n sn C!mpara#es 77.0 52.4 96.7 45.6

Es/m! e 1991 Cas) 13.0 13.0 13.0 13.0

+!a# Esmaed a#e 90.0 65.4 109.7 58.6


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Eskimo Pie Shre Price #$$2-$$Eskimo Pie Share Pri,e

0

5

10

15

20

25

31ar92 13-.93 26Dec94 9ay96 21%ep97 3*e99

P

ri,

rce


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En o( the Eskimo Pie Stor"Eskimo Pie Cor!oratio"

!erati"# ata EC91 EC92 EC93 EC94 EC95 EC96 EC97 EC9( EC99

Sales A*etB 60.96 62.(( 66.0( 70.(9 (3.9( 74.0( 66.39 63.49 66.45os o oo s . . . . . . . . .

*et +",ome AossB 3.75 4.55 3.4( 4.(5 5.0( -2.05 0.11 0.( 0.(4

$n !&em'er 17( 199)( an uns!#i*ited !ffer fr!m +!gen ,ru-

W!r#d"Wide n*!r/!rated t! a*uire 100% !f Esim! ie f!r

310.25 /er sare 4as ree*ted ' Esim! ies 8!ard. +!gen

,ru- res/!nded 4it a 31 *!nditi!na# !ffer !n :e*em'er 2(

199)( and te 8!ard reuested its finan*ia# ad&is!rs t! e;aminete /.

1( 199)Annual Report?. $n @a ( 2000( te *!m/an agreed

t! 'e a*uired ' C!!# 8rands( +!gen ,ru- su**ess!r( f!r

310.25 /er sare. Sare!#ders a**e/ted te !ffer !n Se/tem'er

6.

eskimo pie case 2006

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