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Federated Department Stores

Federated Department Stores. Financial Statement Analysis Group Project Dawna Johnson Kevin Leighton Glen McNew Linda Stump. Brand Recognition – National Strategy. Prior to 8/1/2003 Federated department stores consisted of: The Bon Marche Lazarus Goldsmith's

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Federated Department Stores

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  1. Federated Department Stores Financial Statement Analysis Group Project Dawna Johnson Kevin Leighton Glen McNew Linda Stump

  2. Brand Recognition – National Strategy • Prior to 8/1/2003 Federated department stores consisted of: • The Bon Marche • Lazarus • Goldsmith's • Rich's • Burdines

  3. Brand Recognition – National Strategy

  4. Federated Department Store Analysis • Net sales have remained consistent since 2001 with an increase in 2004 *figures in millions • Cost of sales has remained 60%, 5-7% lower than the market average

  5. Federated Department Store Analysis • Total assets increased $100 million (0.7%) from 2002 to 2003 and $300 million (2.23%) from 2003 to 2004. • Operating income grew $300 million over the last four years. (figures in millions)

  6. Federated Department Store Analysis • Price per share of stock has grown from $28.76 at year end 2002 to a current value of $64.65. • If you invested $500,000 in Federated Department Stores:

  7. Federated Department Store Analysis • Projecting dividends at the current yield would pay $12,589 over three years (2.51%) and $20,882 over five years (4.18%) based on the invested $500,000. Returns calculated using a 500,000 investment on 4/6/2004, purchasing a total of 7,734 shares.

  8. Federated Department Store Analysis • Diluted earnings per share from continuing operations increased in the last three years (3.21, 3.71, 3.86 for 2004) • Cash flow from operating activities increased 47% from 2002 to 2003 and 22.7% from 2003 to 2004. • Cash flow from investing activities increased 63% from 2002 to 2003.

  9. Federated Department Store Analysis • Depreciable assets reflect a yearly depreciation of 328 million with a useful life of 26.45 years.

  10. Federated Department Store Analysis • Inventory days to turn decreased from 2.17 to 2.06 over the last three years. Federated uses LIFO retail inventory method to maximizes cash flow.

  11. Federated Department Store Analysis • Book value increased from 5,564 to 5,762 (3.56% increase) in 2001 to 2002 and increased again in 2003 to 5,940 a 3.09% increase (in millions) • Federated currently has 38.3 million shares of treasury stock equaling a cash value of $2,476,095,000 and has approved $820 million additionally for stock repurchase.

  12. If you want your money to grow… $ BUY FEDERATED

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