1 . No corporate tax (tax rate=0%)
2. Every year 80% of that year’s NI is paid out as dividends
3. No share repurchases
4. Accountants figure that for years 2013-2017 the CapEx will be $7B
5. No Debt is carried after 2012 and no interest is paid on Walmart’s short -term cash.
6. Calculate the FCF for Y2013-2017 and calculate their PV at 6% discount rate
Income Statement Consolidated Income Statements (in US$ millions except per share amounts)ActualsEstimates Period Ending January 312010.02011.02012.02013.02014.02015.02016.02017.0 Revenue Net Sales405,132.0418,952.0443,854.0 % Growth3.4%5.9% Membership and Other Income2,953.02,897.03,096.0 % Growth-1.9%6.9% Total revenue408,085.0421,849.0446,950.0473,767.0497,455.4517,353.6532,874.2543,531.7 Y/Y revenue growth (%)3.4%6.0%6.0%5.0%4.0%3.0%2.0% Cost of goods sold Cost of goods sold304,106.0314,946.0335,127.0355,325.3373,091.5388,015.2399,655.6407,648.7 COGS as a % of revenue74.5%74.7%75.0%75.0%75.0%75.0%75.0%75.0% Gross profit103,979.0106,903.0111,823.0118,441.8124,363.8129,338.4133,218.5135,882.9 Gross profit margin (%)25.5%25.3%25.0%25.0%25.0%25.0%25.0%25.0% Operating expenses Selling, general and administrative72,820.073,720.077,135.081,961.786,059.889,502.292,187.294,031.0 SG&A as a % of revenue17.8%17.5%17.3%17.3%17.3%17.3%17.3%17.3% EBITDA31,159.033,183.034,688.036,480.138,304.139,836.241,031.341,851.9 EBITDA margin (%)7.6%7.9%7.8%7.7%7.7%7.7%7.7%7.7% Depreciation and amortization7,157.07,641.08,130.08,591.79,188.69,809.410,448.911,101.1 EBIT24,002.025,542.026,558.027,888.429,115.530,026.830,582.430,750.8 EBIT margin (%)5.9%6.1%5.9%5.9%5.9%5.8%5.7%5.7% Interest Interest expense (Debt)1,787.01,928.02,034.02,083.82,083.82,083.82,083.8 Interest expense (Capital Leases)278.0277.0288.0281.6281.6281.6281.6281.6 Interest income(181.0)(201.0)(162.0)0.0(40.6)(81.3)(81.3)(81.3) Net interest expense1,884.02,004.02,160.02,365.52,284.22,284.22,284.2 EBT22,118.023,538.024,398.025,522.929,115.527,742.628,298.228,466.6 EBT margin (%)5.4%5.6%5.5%5%6%5%5%5% Income tax expense7,156.07,579.07,944.08,422.69,608.19,155.19,338.49,394.0 Tax rate (%)32.4%32.2%32.6%33.0%33.0%33.0%33.0%33.0% Net Income (Adjusted)14,962.015,959.016,454.017,100.419,507.418,587.518,959.819,072.6 Non-recurring events Discontinued operations(79.0)1,034.0(67.0)0.00.00.00.00.0 Other0.00.00.00.00.00.00.00.0 Total non-recurring events(79.0)1,034.0(67.0)0.00.00.00.00.0 Net Income (After non-recurring events)14,883.016,993.016,387.017,100.419,507.418,587.518,959.819,072.6 Distributions Income attributable to non-controlling interests(513.0)(604.0)(688.0)(718.2)(819.3)(780.7)(796.3)(801.1) Non-controlling interests % of Net Income3.4%3.6%4.2%4.2%4.2%4.2%4.2%4.2% Net Income (as Reported)14,370.016,389.015,699.016,382.118,688.017,806.918,163.518,271.6 Earnings per share (EPS) Basic3.724.484.544.875.735.635.936.16 Diluted3.714.474.524.875.72ERROR:#REF!ERROR:#REF!ERROR:#REF! Average common shares outstanding Basic3,8663,6563,4603,3613,2623,1633,0642,965 Diluted3,8773,6703,4743,3663,2673,1683,0692,970 Shares repurchased99999999 Diluted Shares Share Price$72.00 Number of basic shares outstanding3,361,444,307 Number of outstanding options (in the money)13,596,000 Average option strike price$50.49 Total option proceeds686,462,040 Treasury stock method shares repurchased9,534,195 Additional shares outstanding4,061,805 Total diluted shares outstanding3,365,506,112 The Analyst Exchange&8On - Line Trainingwww.theanalystexchange.com&F, &A&P of &N Cash Flow Statement Consolidated Statements of Cash Flows (in US$ millions)ActualsEstimates Period Ending January 312010.02011.02012.02013.02014.02015.02016.02017.0 Cash flows from operating activities Net income14,883.016,993.016,387.017,100.419,507.418,587.518,959.819,072.6 Loss (income) from discontinued operations79.0(1,034.0)67.00.00.00.00.00.0 Depreciation and amortization7,157.07,641.08,130.08,591.79,188.69,809.410,448.911,101.1 Deferred income taxes(504.0)651.01,050.0715.91,003.5791.0596.3411.4 Other Operating Activities318.01,087.0398.0318.0318.0318.0318.0318.0 Changes in operating working capital Changes in accounts receivable(297.0)(733.0)(796.0)146.5(289.5)(243.2)(189.7)(130.3) Changes in inventory2,213.0(3,205.0)(3,727.0)(148.4)(2,043.1)(1,716.2)(1,338.7)(919.2) Changes in accounts payable1,052.02,676.02,687.0701.21,865.51,567.01,222.2839.3 Changes in accrued liabilities1,348.0(433.0)59.01,425.7979.0822.3641.4440.5 Changes in accrued income taxes0.00.00.0(464.5)98.5(37.6)15.24.6This line is later added Net changes in operating working capital4,316.0(1,695.0)(1,777.0)1,660.5610.3392.3350.6234.9 Total cash flows from operating activities26,249.023,643.024,255.028,386.530,627.729,898.330,673.631,138.1 Cash flows from investing activities Payments for property and equipment (CAPEX)(12,184.0)(12,699.0)(13,510.0)(14,213.0)(14,923.7)(15,520.6)(15,986.2)(16,305.9) Capex as a % of Revenue3.0%3.0%3.0%3.0%3.0%3.0%3.0%3.0%This line is later added Proceeds from disposal of property and equipment1,002.0489.0580.00.00.00.00.00.0 Investments and business acquisitions, net of cash acquired0.0(202.0)(3,548.0)0.00.00.00.00.0 Other investing activities(438.0)219.0(131.0)(438.0)219.0(131.0)(438.0)219.0 Total cash from investing activities(11,620.0)(12,193.0)(16,609.0)(14,651.0)(14,704.7)(15,651.6)(16,424.2)(16,086.9) Cash flows from financing activities Short-term borrowings (repayments)(1,033.0)503.03,019.00.00.00.00.00.0 Long-term borrowings (repayments)(487.0)7,316.0466.00.00.00.00.00.0 Long term debt due within one year0.00.00.00.00.00.00.00.0This line is later added Capital lease obligations due within one year0.00.00.00.00.00.00.00.0This line is later added Dividends paid(4,217.0)(4,437.0)(5,048.0)(5,344.7)(5,187.3)(5,029.9)(4,872.5)(4,715.1) Dividends paid ($/share)1.591.591.591.591.59This line is later added Purchase of common stock [treasury stock](7,276.0)(14,776.0)(6,298.0)(7,308.2)(7,308.2)(7,308.2)(7,308.2)(7,308.2) Purchase of redeemable noncontrolling interest(436.0)0.00.00.00.00.00.00.0 Capital Lease Obligations(346.0)(363.0)(355.0)0.00.00.00.00.0 Other(396.0)(271.0)(242.0)(242.0)(242.0)(242.0)(242.0)(242.0) Total cash from financing activities(14,191.0)(12,028.0)(8,458.0)(12,894.9)(12,737.5)(12,580.1)(12,422.6)(12,265.2) Effect of Exchange Rate on Cash194.066.0(33.0)194.066.0(33.0)194.066.0 Total change in cash and cash equivalents632.0(512.0)(845.0)1,034.63,251.61,633.62,020.72,851.9 SUPPLEMENTAL DATA: Cash flow before debt paydown1,034.63,251.61,633.62,020.72,851.9 The Analyst Exchange&8On - Line Trainingwww.theanalystexchange.com&F, &A&P of &N Balance Sheet Consolidated Balance Sheets (in US$ millions)ActualsEstimates On January 312010.02011.02012.02013.02014.02015.02016.02017.0 Assets Current assets: Cash and cash equivalents7,395.06,550.00.00.00.00.00.0 Receivables, net5,089.05,937.00.00.00.00.00.0 Inventories36,437.040,714.00.00.00.00.00.0 Prepaid expenses and other2,960.01,685.00.00.00.00.00.0 Other current assets (discontinued operations)131.089.00.00.00.00.00.0 Total current assets52,012.054,975.00.00.00.00.00.0 Property, plant and equipment, net107,878.0112,324.00.00.00.00.00.0 Goodwill16,763.020,651.00.00.00.00.00.0 Other assets and deferred charges4,129.05,456.00.00.00.00.00.0 Total assets180,782.0193,406.00.00.00.00.00.0 Liabilities0.00.00.00.00.0 Current liabilities:0.00.00.00.00.0 Short-term borrowings1,031.04,047.00.00.00.00.00.0 Accounts payable33,676.036,608.00.00.00.00.00.0 Accrued liabilities18,701.018,154.00.00.00.00.00.0 Accrued income taxes157.01,164.00.00.00.00.00.0 Long term debt due within one year4,655.01,975.00.00.00.00.00.0 Obligations under capital leases due within one year336.0326.00.00.00.00.00.0 Current liabilities of discontinued operations47.026.00.00.00.00.00.0 Total current liabilities58,603.062,300.00.00.00.00.00.0 Long-term debt40,692.044,070.00.00.00.00.00.0 Long-term obligations under capital leases3,150.03,009.00.00.00.00.00.0 Deferred income taxes and other6,682.07,862.00.00.00.00.00.0 Redeemable noncontrolling interest408.0404.00.00.00.00.00.0 Total liabilities109,535.0117,645.00.00.00.00.00.0 Shareholders' equity 0.00.00.00.00.0 Common stock par value + additional paid-in-capital3,929.04,034.00.00.00.00.00.0 Retained earnings63,967.068,691.00.00.00.00.00.0 Accumulated other comprehensive income (loss)646.0(1,410.0)0.00.00.00.00.0 Total shareholders' equity68,542.071,315.00.00.00.00.00.0 Noncontrolling interest2,705.04,446.00.00.00.00.00.0 Total liabilities & equity180,782.0193,406.00.00.00.00.00.0 SUPPLEMENTAL DATA: Balance? (Y/N)YYYYYYY Consolidated Balance Sheets 0ActualsEstimates Assets The Analyst Exchange&8On - Line Trainingwww.theanalystexchange.com&F, &A&P of &N Depreciation Depreciation (in US$ millions)ActualsEstimates Period Ending January 312010.02011.02012.02013.02014.02015.02016.02017.0 Property, plant & equipment (beg. of year)112,324.0 Capital expenditures (beg. of year)14,213.014,923.715,520.615,986.216,305.9 Book (GAAP) depreciation Useful Life PP&E Years14 CAPEX Years2525252525 Depreciation Existing PP&E8,023.18,023.18,023.18,023.18,023.1 2013 CAPEX568.5568.5568.5568.5568.5 2014 CAPEX596.9596.9596.9596.9 2015 CAPEX620.8620.8620.8 2016 CAPEX639.4639.4 2017 CAPEX652.2 Total book depreciation8,591.79,188.69,809.410,448.911,101.1 Accelerated depreciation (%) Existing PP&E8.75%9.13%8.21%7.39%6.65% 2013 CAPEX6.56%7.00%6.48%6.00%5.55% 2014 CAPEX6.56%7.00%6.48%6.00% 2015 CAPEX6.56%7.00%6.48% 2016 CAPEX6.56%7.00% 2017 CAPEX6.56% Accelerated depreciation Existing PP&E9,828.410,255.29,221.88,300.77,469.5 2013 CAPEX932.8994.9921.3852.2788.3 2014 CAPEX979.41,044.7967.4894.8 2015 CAPEX1,018.61,086.41,006.0 2016 CAPEX1,049.21,119.0 2017 CAPEX1,070.2 Total tax depreciation10,761.112,229.512,206.412,255.912,347.9 Difference in depreciation2,169.53,040.92,396.91,807.01,246.7 Tax rate (%)33%33%33%33%33% Deferred taxes715.91,003.5791.0596.3411.4 The Analyst Exchange&8On - Line Trainingwww.theanalystexchange.com&F, &A&P of &N Operating Working Capital Operating Working Capital Schedule (OWC) (in US$ millions)ActualsEstimates On January 312010.02011.02012.02013.02014.02015.02016.02017.0 Current assets Receivables, net5,089.05,937.05,790.56,080.06,323.26,512.96,643.2 Days receivable4.44.44.44.44.44.4 Inventories36,437.040,714.040,862.442,905.544,621.745,960.446,879.6 Inventory turnover days41.441.441.441.441.441.4 Prepaid expenses and other2,960.01,685.02,458.92,581.82,685.12,765.62,820.9 Days prepaid10.810.810.810.810.810.8 Total current assets44,486.048,336.049,111.751,567.353,630.055,238.956,343.7 Current liabilities Accounts payable33,676.036,608.037,309.239,174.640,741.641,963.842,803.1 Days payable37.837.837.837.837.837.8 Accrued liabilities18,701.018,154.019,579.720,558.721,381.122,022.522,463.0 Days payable86.086.086.086.086.086.0 Accrued taxes157