cash flow profiles - learnfrombarryprework

© Barry M Frohlinger 1981 - 2012

Cash Flow Profiles

© Barry M Frohlinger, Inc. copyright 1981 - 2017 1

Cash Flow Profiles

•  Attach are the cash flows of 20 companies –  Pepsi –  Tesla –  Avon –  Manitowic is a Capital Goods Manufacturer –  Bunge is a Leading Agribusiness and Food Company –  Apple –  Nokia –  RiteAid is a leading drugstore chain –  Flextronics –  Disney –  Navistar is a manufacturer of trucks, engines and school buses –  Freescale was one of the first semiconductor companies, spin off by Motorola in 2003 –  Costco –  Walmart –  JC Penney –  P&G –  Exxon Mobil –  CB&I is a Dutch Engineering and Construction Firm –  CVS –  Rosneft


Cash Flow Profiles

•  Label the Cash Flow Profile of each of these firms as –  Mature –  Cyclical –  Volatile –  Growing –  Declining/Troubled –  Other

•  Identify anything noteable about the cash flows for each of these firms

© Barry M Frohlinger, Inc. copyright 1981 - 2017

Pepsi, Revenue

3


Pepsi, EBITDA

4


Pepsi, CFO, CapX and Div

0

2000

4000

6000

8000

10000

12000

98 99 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16


Pepsi

0

2000

4000

6000

8000

10000

12000

98 99 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

CfopsResidual


Tesla, Revenue

7


Tesla, EBITDA

8


Tesla

-1000

-500

0

500

1000

1500

2000

2009 2010 2011 2012 2013 2014 2015 2016

CfopsCapXBorrowing


Tesla

10


Tesla

11


Avon Revenue

12


Avon


Avon

-200

0

200

400

600

800

1000

Cfops 324 449 324 748 565 745 883 896 796 590 748 755 689 656 556 540 360 91Residual -47 60 -48 411 247 381 363 375 303 -15 19 94 -26 -24 -14 236 118 -110

98 99 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15


Manitowic

15


Manitowic


Balance Sheet Structure

18


Balance Sheet Structure

19


Returns

20


Returns

21


Manitowic

22


Towers, with 2015 LT Free Cash Flow

23


Bunge

24


Bunge

25


Bunge

-3000

-2000

-1000

0

1000

2000

3000

Cfops 37 -521 205 128 -41 802 382 -289 -411 254 -368 -244 261 -457 222 139 610 190CapX 140 184 226 240 304 437 522 503 658 896 918 107 112 109 104 839 649 784Dividends 0 0 8 37 42 51 63 74 34 81 78 78 140 151 167 187 207 223

99 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16


Bunge

-4000

-3000

-2000

-1000

0

1000

2000

3000

Cfops 37 -521 205 128 -41 802 382 -289 -411 254 -368 -244 261 -457 222 139 610 190Residual -103 -705 -29 -149 -387 314 -203 -866 -110 156 -136 -359 145 -170 101 373 -246 897

99 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16


Bunge [Sales 42,679]

28


Bunge [Sales 42,679, EBITDA 1,671 Op Profit 1,124 ]

29


Bunge [Avg FCF -90]

0

200

400

600

800

1000

1200

1400

1600

1800

2017 2018 2019 2020 2021 thereafter

30


Bunge Unused

31


Apple Revenue

32


Apple EBITDA

33


Apple


Apple, 2016

36


Nokia

-1000

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

Cfops 6547 5814 5244 4343 4144 4478 7882 3197 3247 4774 1137 -354 72 1275 507Capital Spending 1041 437 432 548 607 650 715 889 531 679 597 461 407 311 314Dividends 1396 1348 1378 1413 1531 1553 1760 2048 1546 1519 1536 755 71 1392 512

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15


Nokia

-4000

-2000

0

2000

4000

6000

8000

10000

Cfops 6547 5814 5244 4343 4144 4478 7882 3197 3247 4774 1137 (354) 72Residual 4110 4029 3434 2382 2006 2275 5407 260 1170 2576 -996 (1,570 -408

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


Nokia

39


Rite Aid

-800

-600

-400

-200

0

200

400

600

800

1000

Cfops -701 16 305 228 518 417 309 79 360 -325 396 267 820 702Capital Spending 133 175 105 251 191 288 334 687 461 184 162 215 315 334Dividends 0 0 0 0 0 0 0 0 0 0 0 0 0 0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014


Rite Aid

-1,000

-800

-600

-400

-200

0

200

400

600

800

1,000

Cfops -701 16 305 228 518 417 309 79 360 -325 396 267 820 702 Residual -833 -159 201 -23 327 129 -25 -609 -101 -509 234 52 505 468

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014


Rite Aid

-1000

-500

0

500

1000

1500

EBITDA 338 396 860 936 980 890 876 911 905 866 966 1033 1214 1209Funds Flow -35 12 190 215 211 201 198 290 217 200 199 255 688 747Cfops -701 16 305 228 518 417 309 79 360 -325 396 267 820 702

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014


Flextronics

-600

-400

-200

0

200

400

600

800

1000

1200

1400

1600

Cfops -470 -34 161 859 608 188 724 549 276 1043 1317 799 804 1115 1216CAPX 711 462 322 330 208 181 290 251 569 328 462 176 437 489 609Dividends 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


Flextronics

-1500

-1000

-500

0

500

1000

1500

Cfops -470 -34 161 859 608 188 724 549 276 1043 1317 799 804 1115 1216 Residual -1181 (496) -161 529 400 7 434 298 -293 715 855 623 367 626 606

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


Disney

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

Cfops 3,75 3,04 2,28 2,90 4,37 4,26 5,96 5,39 5,44 5,31 6,57 6,99 799 945 978 1E+01E+0Capital Spending 201 179 108 1,04 1,42 1,82 1,29 1,56 1,57 1,75 2,11 3,55 378 279 291 409 472Dividends 434 438 428 429 430 490 519 637 664 648 653 756 107 132 150 306 231

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016


Disney

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

Cfops 3,75 3,04 2,28 2,90 4,37 4,26 5,96 5,39 5,44 5,31 6,57 6,99 7966 9452 9780 1E+0 1E+0Residual 1,30 815 772 1,42 2,51 1,95 4,14 3,19 3,20 2,91 3,81 2,67 3136 5332 5356 3747 6172

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016


Disney Sales 55,632

47


Disney EBITDA 16,885, Op Profit 14,358

48


Disney EBITDA 16,885, Op Profit 14,358

49


Disney Residual Cash Flows

50


Navistar

51


Navistar

-800

-600

-400

-200

0

200

400

600

800

1000

1200

1400

Cfops 672 203 -74 190 298 275 -287 262 112012381107 880 610 100 -336 46 267CAPX 553 326 242 306 244 295 230 312 176 151 234 429 309 167 88 115 116Dividends 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Residual 119 -123 -316 -116 54 -20 -517 -50 944 1087 873 451 301 -67 -424 -69 151

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16


Navistar

53


Freescale EBITDA of 878 and Debt of 6,479

-200

0

200

400

600

800

1000

1200

1400

Cfops 558 1272 1272 1241 426 405 76 394 99 350 321CAPX 310 522 491 624 327 239 85 281 135 123 151Dividends 0 0 0 0 0 0 0 0 0 0 0Residual 248 750 781 617 99 166 9 113 -36 227 170

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


Sprint Balance Sheet

55



56



57


Sprint [Debt/EBITDA 3.8X]

58



59



60



61


Senior Notes with rates 7 – 12%

62


Costco

-1,000

-500

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Cfops 1,070 1,033 1,018 1,507 2,099 1,783 1,831 2,076 2,176 2,092 2,780 3,198 3057 3437Capital Spending 1,228 1,448 1,039 811 706 995 1,217 1,386 1,599 1,250 1,055 1,290 1480 2083Dividends 0 0 0 0 92 205 230 246 265 296 338 389 446 511Residual -158 -415 -21 696 1301 583 384 444 312 546 1387 1519 1131 843

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


Walmart

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16Cfops 9604 10260 13005 15996 15044 18241 19952 20354 23147 26249 23643 24255 25591 23257 28564 27389CAPX 8042 8383 9245 10308 12893 14530 15666 14937 11499 12184 12699 13510 12898 13115 12174 11477Div 1070 1249 1328 1569 2214 2511 2802 3586 3746 4217 4437 5048 5361 6139 6185 6294residual 492 628 2432 4119 -63 1200 1484 1831 7902 9848 6507 5697 7432 4003 10205 9618

-5000

0

5000

10000

15000

20000

25000

30000


Wal Mart Sales 482,130

65


Wal Mart Sales 482,130, EBITDA OF 33,559 and Op Profit of 24,105

66


Wal Mart, unused revolver and 2016 FCF

67


JC Penney

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Sales 18096 18781 18903 19860 18486 17556 17759 17260 12985 11859 12257 12625

0

5000

10000

15000

20000

25000 Sales


JC Penney


JC Penney

70


JC Penney

71


JC Penney

72


Average Annual FCF [12 yrs] -140 MM

73


JC Penney

74


P&G [total debt of 30,598]

-4000

-2000

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

Cfops 354229224352518661566923868410341207134312841333132814871E+0 1E+0 1543CapX 30182486167914822024218126672945304632383067330639644008384837363314Dividends 17961943209522462539273137034209465550445458576761396519691172877436residual -129 -150 578 14581593201123143186437451544321425731814346319935854685

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16


Exxon Revenue

76


Exxon Mobil


CBI

78

Chicago Bridge & Iron carries debt after completing its $3 billion acquisition of Shaw Group in 2012. The industry in general tends to see a lot of volatility in cash flow, so there’s a tendency to keep funded debt balances lo. Shaw had a debt-to-Ebitda ratio of about 2.1, including operating leases and postretirement obligations. However, the combined company will have a debt-to-Ebitda ratio of roughly 3.5-to-one after taking on $1.9 billion of debt to fund the deal. In a conference call to announce the deal, CB&I CEO told analysts that CB&I, which currently had no rating, expected to retain “an investment-grade-type credit profile,” after the deal. Shaw Group was rated BBB- by S&P. Moody’s said that the combined company will see a “substantial decline in the consolidated liquidity at a time when they will be taking on greater financial and business risk and the risks associated with the integration of the two organizations.” Shaw had recently taken steps to reduce its debt. In September 2011, it exercised a right to sell a 20% stake in nuclear energy company Westinghouse Electric to Toshiba. Shaw used the proceeds to pay down the $1.7 billion in yen-denominated bonds it sold to buy the Westinghouse stake in the first place.


CB&I Revenue

79


CB&I EBITDA

80


CBI

81


CB&I

-300

-200

-100

0

100

200

300

400

500

600

700

Cfops 4 106 72 90 133 165 476 446 26 249 288 413 203 -113 264 -56 654CapX 6 9 23 31 17 36 80 88 124 48 24 41 72 90 118 79 52Dividends 2 5 5 7 8 12 12 15 15 0 0 20 19 21 30 30 29residual -4 92 44 52 110 117 384 343 -113 201 264 352 112 -224 106 -165 573

0 1 2 3 4 5 6 7 8 9 0 11 12 13 14 15 16


CBI [Debt/EBITDA 2.84X]

83


CBI [Average FCF 132 and best 573]

84


CVS Caremark

-1000

0

1000

2000

3000

4000

5000

6000

7000

8000

Cfops 780 681 1205 907 914 1612 1742 3230 3947 4035 4779 5856 6671 5783CapX 695 714 1109 1122 1348 1495 1769 1805 2180 2548 2005 1872 2030 1984Dividends 105 105 105 105 120 132 141 322 383 439 479 674 829 1097residual -20 -138 -9 -320 -554 -15 -168 1103 1384 1048 2295 3310 3812 2702

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


Rosneft

-5000

0

5000

10000

15000

20000

25000

30000

35000

40000

Cfops 437 529 794 707 2912 2590 1711014393 1145215419 1571014471 33691Capital Spending 397 420 821 853 2085 3462 6240 8732 7581 8516 1261313141 15569Dividends 21 35 49 51 61 424 521 516 613 710 871 1974 2358residual 19 74 -76 -197 766 -1296 10349 5145 3258 6193 2226 -644 15764

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


Pepsi

0

2000

4000

6000

8000

10000

12000

14000

2014 2015 2016 2017 2018 after

LTD

Revolver


Omnicom BBB rated

0

500

1000

1500

2000

2500

3000

3500

year 1 year 2 year 3 year 4 year 5 after

LTD

Revolver


Avaya LBO

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000


LTD

Revolver


Asset Based Office Depot

0

200

400

600

800

1000

1200

1400

1600

1800

2000


LTD

Revolver


EA Sports High Tech

0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1


LTD

Revolver


Bunge

0

100

200

300

400

500

600

700

800

900

1000

2014 2015 2016 2017 2018 after

LTD

Revolver


Navistar

0

200

400

600

800

1000

1200

1400

1600

1800

LTD 1190 711 196 1292 247 15242014 2013 2014 2015 2016 after

cash flow profiles - learnfrombarryprework

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