The document provides financial and operational data for several major automakers including BMW, Mercedes-Benz, and Toyota for the years 2013-2015. It includes key metrics such as revenue, assets, profit, margins, and ratios to evaluate performance and compare the companies. The ratios analyze metrics like liquidity, profitability, efficiency, leverage, and valuation to better understand the financial health and operations of the automakers.

1. 1
Sharif University of Technology
Graduate School of Management and Economics
Reza Esmaeili

2. Worldwide automobile production from 2000 to 2014
2
Million vehicles
According to a forecast by
PwC, in 2017 a total of 102
million vehicles will be
manufactured worldwide.
One of the world's most
important economic
sectors by revenue

3. China, 26.43%, 26%
European Union, 18.92%,
19%
United States, 12.99%, 13%
Japan, 10.89%, 11%
Iran, 1.22%, 1%
Rest of the World, 29.55%,
30%
MOTOR VEHICLE PRODUCTION
3
Motor vehicle production by countries

4. Who exported Cars in 2012?
This map shows only gross
export amount.
USA was the largest net
importer, also UK and France
are net importers.
Net Export Worth: 645B USD
4

5. Leading automobile manufacturers worldwide
10.23
10.14
9.92
8.47
7.71
6.32
4.75
4.36
2.94
2.88
2.53
2.12
1.38
1.19
1.15
1.08
1.04
0.97
0 2 4 6 8 10 12
Toyota
Volkswagon
GM
Renault-…
Hyundai-Kia
Ford
Fiat-Chrystler
Honda
PSA
Suzuki
Daimler
BMW
Mazda
Dongfeng
Changan
Mitsubishi
BAIC
Tata
Million units
Leading automobile manufacturers in 2014, based on vehicle sales
5

6. Revenue of the leading automotive manufacturers
worldwide
202.46
188.16
129.87
128.82
119.03
96.09
87.36
80.4
79.35
67.56
53.61
41.06
35.65
21.19
20.77
15.25
0 50 100 150 200 250
Volkswagon
Toyota
Daimler
GM
Ford
Fiat-Chrysler
Honda
BMW
Nissan
Hyundai
Peugeot
Renault
Kia
Suzuki
Mazda
Mitsubishi
Billion euros
Revenue of the leading automotive manufacturers worldwide in 2014
6

7. Worlds most valuable brand in automotive industry (Forbes 2015)
7
Lexus # 66 $8 B
Brand World
Rank
Brand
Value
Volkswagen # 67 $8 B
Toyota # 8 $37.8 B
BMW # 16 $27.5 B
Honda # 23 $22.6 B
Mercedes-Benz # 24 $22.5 B
Audi # 39 $12.8 B
Ford # 41 $12.5 B
Chevrolet # 62 $9 B
Hyundai # 64 $8.4 B

8. The BMW Group
8
Bayerische Motoren Werke
Type: Aktiengesellschaft (AG)
Industry: Automotive
Founded: 1916
Headquarters: Munich, Bavaria, Germany
Area served: Worldwide
Products: Luxury vehicles, sports
cars, motorcycles
Services: Financial Service
2014 Overview
Production output: 2.12 million cars
123,000 motorcycles
Revenue: €80.40 billion
Operating income: €8.71 billion
Total assets: €154.80 billion
No of employees: 116,324
Diversity: 30 production facilities
in 14 countries
Sales Network: 142 countries
Global Ranking (Forbes 2015)
#16 Most Valuable Brands
#45 Biggest Public Companies
#52 in Sales
#61 in Profit
#151 in Assets
#7 America's Best Employers
Mission Statement
To be the most successful premium
manufacturer in the industry.
Slogan "Sheer Driving Pleasure“ (Worldwide)
"The Ultimate Driving Machine“ (United States)
"The Ultimate Driving Experience“ (Canada)

9. 17.4
16.7
12.6
53.3
Stefan Quandt
Johanna Quandt
Susanne Klatten
Free Float
Age: 89
Matriarch of BMW Clan
77th richest person in the world
Age 53 Net Worth 15.3 billion USD
the richest woman in Germany
the 54th richest person in the world.
Age 49 Net Worth 13.4 billion USD
the 59th richest person in the world
Shareholder Structure
9
Deceased: August 3, 2015

10. New Shareholder Structure
25.8
20.9
53.3
Stefan Quandt
Susanne Klatten
Free Float
10

11. BMW Group in Figures
A big financial picture of BMW performance 2010-2014, For people
who are not interested in details of the report
Report of Supervisory
Board
Joachim
Milberg
Statement of Chairman of
the Board of Management
Norbert
Reithofer
Combined Management
Report
General Information on
the BMW Group
Group Financial Statement
Statement on Corporate
Governance
Other Information
BMW Annual Report
Issued: 31 Dec 2014
General Information on the BMW Group
• Business Model
• Management System
• Financial and Non-financial Performance Indicators
• Review of Operations
• Events after the End of the Reporting Period
• Risks and Opportunities
• Financial Reporting Process
• BMW Stock and Capital Markets in 2014
Group financial Statements
• Income Statements
• Balance Sheets
• Cash Flow
• Statement of Changes in Equity
• Notes to the Financial Statements
Statement on Corporate Governance
• Company’s Governing Constitution
• Members of the Boards
• Composition and Work Procedures
• Practices beyond Mandatory Requirements
• Responsibility Statement
• Auditor’s Report
Other Information
• BMW Group Ten-year Comparison
• BMW Group Locations
• Glossary
• Index
• Financial Calendar
• Contacts
Who are these guys?
11

12. Profitability of BMW?!
The answer is EVA…
Is it beneficial to run BMW?
First Question…!
If yes
By how much?!
What is it?
Economic value added (EVA) is an internal management performance
measure that compares net operating profit to total cost of capital.
How is it calculated?
EVA = Net Operating Profit After Tax (NOPAT) – Cost of Capital
Cost of Capital = Capital Invested x WACC
WACC: weighted average cost of capital
i.e.
Economic Value Added
Or
Economic Profit
12

13. Profitability of BMW?!
The pre-tax average weighted cost of
capital for the BMW Group in 2014 was
12 %, unchanged from the previous year.
13

14. BMW comparison with two
other prominent brands
Revenue 157,236,030 $ 97,341,491 $ 227,096,000 $
Revenue per Employee 561,000 $ 836,000 $ 670,000 $
Total Assets 229,591,095 $ 187,419,992 $ 397,997,000 $
No of Employees 279,972 116,324 338,875
Production (Units) 2,530,000 2,120,000 10,230,000
Net Profit 8,428,893 $ 7,019,639 $ 18,122,000 $ Do not Panic!
It’s only a mellow ratio!
14

15. Liquidity Measurement Ratios
Current Ratio
Profit Margin Analysis
Cash Flow To Debt Ratio
Quick Ratio
Cash Conversion Ratio
Cash Ratio
Profitability Indicator Ratios
Effective Tax Rate
Debt Ratios
Return On Assets
Return On Capital Employed
Return On Equity
Overview of Debt
Debt Ratio
Debt-Equity Ratio
Interest Coverage Ratio
Capitalization Ratio
Operating Performance Ratios
Fixed Asset Turnover
Sales/Revenue Per Employee
Operating Cycle
Operating Cash Flow/Sales Ratio
Cash Flow Indicator Ratios
Free Cash Flow/Operating Cash Ratio
Cash Flow Coverage Ratio
Investment Valuation Ratios
Dividend Payout Ratio
Per Share Data
Price/Book Value Ratio
Price/Earnings To Growth Ratio
Price/Cash Flow Ratio
Price/Sales Ratio
Dividend Yield
Enterprise Value Multiple
Price/Earnings Ratio
Financial Ratios
15

16. Liquidity Measurement Ratios
Current Ratio
Profit Margin Analysis
Quick Ratio
Profitability Indicator Ratios
Effective Tax Rate
Debt Ratios
Return On Assets
Return On Equity
Debt Ratio
Interest Coverage Ratio
Operating Performance Ratios
Fixed Asset Turnover
Investment Valuation Ratios
Price/Earnings Ratio
Financial Ratios
16

17. Current Ratio
What you need: Balance Sheet
The formula: Current Ratio = Current Assets / Current Liabilities
What it means: The current ratio measures a company's ability to
pay its short-term liabilities with its short-term assets. If the ratio
is over 1.0, the firm has more short-term assets than short-term
debts. But if the current ratio is less than 1.0, the opposite is true
and the company could be vulnerable to unexpected bumps in the
economy or business climate.
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
INDUSTRY
1.02 0.96 1.15 1.09 1.27
• current assets are not sufficient to cover short
term liabilities
• ratio is below the lowest permitted level
• if the current ratio is higher than the industry
standard level, there is an insufficient use of the
resources
17

18. Quick Ratio
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
INDUSTRY
0.83 0.77 0.84 0.96 0.63
What you need: Balance Sheet
The formula: Quick Ratio = (Current Assets - Inventory) / Current Liabilities
What it means: The quick ratio (also known as the acid-test ratio) is similar
to the current ratio in that it's a measure of how well a company can meet its
short-term financial liabilities. However, it takes the concept one step further.
The quick ratio backs out inventory because it assumes that selling inventory
would take several weeks or months. The quick ratio only takes into account
those assets that could be used to pay short-term debts today.
• they are not able to settle their current
liabilities instantaneously
• a low quick ratio suggests liquidity risk, or,
better credit terms with suppliers than the
competitors
• these three companies have higher ratio than
the industry average, it proves their superiority
over other brands.
18

19. Total Assets Turnover
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
INDUSTRY
0.55 0.52 0.68 0.57 0.91
What you need: Balance Sheet
The formula: Total assets turnover = Sales / Total Assets
What it means: A higher number is preferable, since it suggests that the
company is using its assets efficiently to make money. A lower number may
convince a company to try other methods to help maximize the efficiency
of its assets. Nevertheless, this ratio varies between industries and can only
be compared effectively between businesses in the same sector .
• lower than the industry standard
• Reasons could be excess production capacity,
poor inventory management, lax collection
methods
• improvement could be done via increasing
sales, decreasing fix assets, or decreasing
working capital
19

20. Debt Ratio
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
0.74 0.76 0.76 0.65
What you need: Balance Sheet
The formula: Total debt / Total assets
Where: Total Debt = Non-current provisions and liabilities + Current
provisions and liabilities = Total Equity and Liabilities - Equity
What it means: Measures the extent to which borrowed funds have
been used to finance the firm's operations. The higher this ratio, the
more leveraged the company is, implying greater financial risk. At the
same time, leverage is an important tool that companies use to grow,
and many businesses find sustainable uses for debt .
• lower value of debt ratio is favorable
• great value indicates:
1. higher portion of company’s assets are
claimed by its creditors
2. difficult to obtain loans for new projects
20

21. Interest Coverage Ratio
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
INDUSTRY
24.85 22.36 26.18 127.29 8.38
What you need: Income Statement
The formula: Interest Coverage Ratio = EBIT / Interest Expense
What it means: Both EBIT (aka, operating income) and interest
expense are found on the income statement. The interest coverage
ratio, also known as times interest earned (TIE), is a measure of
how well a company can meet its interest payment obligations. If
a company can't make enough to make interest payments, it will
be forced into bankruptcy. Anything lower than 1.0 is usually a
sign of trouble.
advisable to maintain an interest coverage of at least 2
times
• interest cover of lower than 1.5 times: fluctuations
in profitability and potential to delays in interest
payments
21

22. Revenue
Sales (revenue) $20,438
Operating expenses
Cost of goods sold $7,943
Selling, general and administrative expenses $8,172
Depreciation and amortization $960
Other expenses $138
Total operating expenses $17,213
Operating income $3,225
Non-operating income $130
Earnings before Interest and taxes (EBIT) $3,355
Financial income $45
Income before interest expense (IBIE) $3,400
Financial expense $190
Earnings before income taxes (EBT) $3,210
Income taxes $1,027
Net income $2,183
Examplestatementofincome(figuresinthousands)
Profitability Ratios
Profitability Ratios
Basically, it is the amount of
profit (at the gross, operating,
pretax or net income level)
generated by the company as a
percent of the sales generated.
22

23. Operating Margin
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
INDUSTRY
10.29% 11.18% 7.20% 10.71% 12.40%
What you need: Income Statement
The formula: Operating Margin (Return on Sale) =
Profits before taxes and interest / Sales
What it means: Operating margin measures a company's
pricing strategy and operating efficiency. Operating margin is a
measurement of what proportion of a company's revenue is left
over after paying for variable costs of production such as
wages, raw materials, etc.
the BMW’s operating margin is quite high it is
preferred because the company make more money
for each euro of sales
• BMW is more profitable than BENZ and TOYOTA
23

24. Net Profit Margin
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
INDUSTRY
6.97% 7.21% 5.36% 7.98% 10.38%
What you need: Income Statement
The formula: Profit Margin = Net Income / Sales
What it means: Profit margin calculates how much of a
company's total sales flow through to the bottom line. As you
can probably tell, higher profits are better for shareholders, as
is a high (and/or increasing) profit margin.
• net profit margin of BMW is higher than BENZ but
lower than TOYOTA and the average of cars industry
• It implies the lower tax rate in Japan than in Germany
24

25. Return On Equity (ROE)
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
14.96% 15.55% 15.94% 12.95%
What you need: Income Statement, Balance Sheet
The formula: ROE = Net Income / Average Stockholder Equity
What it means: Equity is another word for ownership. ROE
tells you how good a company is at rewarding its shareholders
for their investment. For example, if Company B reported
$10,000 of net income and its shareholders have $200,000 in
equity, its ROE is 5%. For every $1 of equity shareholders own,
the company generates $0.05 in profits each year. As with ROA,
higher is better.
• BMW is outperforming TOYOTA
25

26. Return On Assets (ROA)
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
3.93% 3.96% 3.89% 4.53%
What you need: Income Statement, Balance Sheet
The formula: ROA = Net Income / Average Total Assets
What it means: A company buys assets (factories, equipment,
etc.) in order to conduct its business. ROA tells you how good
the company is at using its assets to make money. For example,
if Company A reported $10,000 of net income and owns
$100,000 in assets, its ROA is 10%. For ever $1 of assets it
owns, it can generate $0.10 in profits each year. With ROA,
higher is better.
• for ROA, it’s important to consider the industry and
the sector of company
26

27. Price/Earnings Ratio
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
10.50 10.20 10.58 10.13
What you need: Income Statement, Most Recent Stock Price
The formula: P/E Ratio = Price per Share / Earnings Per Share
What it means: Think of the price-to-earnings ratio as the price
you'll pay for $1 of earnings. A very, very general rule of thumb
is that shares trading at a "low" P/E are a value, though the
definition of "low" varies from industry to industry.
• BMW shows a desirable value, but TOYOTA’s status
is more promissing
27

28. Effective Tax Rate
BMW
DEC.2013
BMW
DEC.2014
BENZ
DEC.2014
TOYOTA
MAR.2015
34.1 % 33.6 % 32.0 % 30.8 %
What you need: Income Statement
The formula: Income Tax Expense / Pretax Income
What it means: The average rate at which an individual or
corporation is taxed. The effective tax rate for individuals is the
average rate at which their earned income is taxed.
• Toyota incurs less tax rate
Effective Tax Rate
28

29. 29

30. I. www.bmw.com
II. https://www.daimler.com
III. www.toyota.com
IV. http://www.forbes.com/powerful-brands/list/
V. http://www.statista.com/statistics/262747/worldwide-automobile-production-since-2000/
VI. http://csimarket.com/Industry/Industry_Data.php?ind=404
VII. https://en.wikipedia.org/wiki/Automotive_industry
VIII.https://en.wikipedia.org/wiki/Earnings_before_interest_and_taxes
IX. http://www.hl.co.uk/shares/shares-search-results/b/bayerische-motoren-werke-ag-eur1
X. http://www.gurufocus.com/term/pe/DDAIF/P%252FE%2BRatio/Daimler%2BAG
XI. http://www.gurufocus.com/term/pe/TM/P%252FE%2BRatio/Toyota%2BMotor%2BCorp
References
30

31. Thanks to my wife, Samira,
who helped me all the way.
Contact:
Esmaeili_reza@gsme.sharif.edu
Esmaeili.rza@gmail.com
31