Submitted by: Submitted by SidVicious
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Category: Business and Industry
Date Submitted: 09/18/2010 02:24 PM
INDIVIDUAL ASSIGNMENT: WEEK FOUR
1. Financial Statements Analysis
Using the financial statements of Landry’s Restaurants located in Appendix A of the text, Fundamentals of Financial Accounting 1st ed., by Phillips, Libby, and Libby, compute the following ratios for 2002 and 2003:
a. Earnings per share
b. Return on assets
c. Current ratio
d. Times interest earned
e. Asset turnover
f. Debt to total assets
g. Current cash debt coverage
h. Cash debt coverage
i. Free cash flow
Based on your analysis, what does this tell you of Landry’s financial performance (consider the changes between years)?
Landry's restaurants
2003 2002
Shares outstanding 27,653,852 27,771,479
Retained earnings $166,526,894.00 $125,459,679.00
Earnings per share $6.02 $4.52
Total assets $1,102,785,506 $933,015,079
Net Income $45,901,054 $41,521,616
Return on assets 4.16% 4.45%
Current assets $120,604,181 $92,669,115
Current liabilities $159,581,009 $148,354,402
Current ratio 0.756 0.625
Earnings before interest, taxes, depreciation & amortization $68,416,764 $64,286,619
Interest $9,561,482 $4,997,022
Times interest earned 7.155 12.865
Revenue $1,105,755,057 $894,794,621
Asset turnover 1.003 0.959
Debt 299,735,906 189,354,402
Debt to total assets 0.27 0.20
Current cash debt coverage 0.4287 0.4333
Total liabilities $498,234,757 $365,939,642
Cash debt coverage 0.137 0.176
Depreciation/amortization $48,824,493.00 $40,480,020.00
Change in working capital -$2,618,567.00 -$20,241,612.00
Capital expenditures $162,894,783.00 $115,903,544.00
Free cash flow -$65,550,669.00 -$13,660,296.00
Based on the analysis, the company increased the earnings per share, which is a good sign for the shareholders, and future investors. On the other end, the company’s return on assets was lower. This sign might be an indication that the company’s assets are not being used as successfully as in the prior year. Landry’s current ratio is...