* Practice A has an operating margin of 4% on $3 million in net sales.
* 4% of $3 million is 0.04 * $3,000,000 = $120,000
* Practice B has an operating margin of 8% on the same $3 million in net sales.
* 8% of $3 million is 0.08 * $3,000,000 = $240,000
* Therefore, Practice B has a higher EBITDA and would be valued higher based on the operating income method.
The document is a case study presentation analyzing the growth and bank financing needs of Horniman Horticulture. It provides background on the company, analyzes its financial performance and ratios, identifies a working capital issue, and makes recommendations. The company is facing a cash shortage as most of its current assets are tied up in receivables and inventory. It is recommended that the company obtain bank financing through a line of credit and implement policies to better manage accounts receivable, inventory, and payables to improve its cash flow situation.
This presentation is solution of the case 12th from the book "cases in financial management" by joseph m. sulock and John S. Dunkelberg.
( If u study in IBSU and taking George Simongulashvili's course :)) I hope it will help u very much whatever use it well... :)))
P.S this presentation was scored by 100 ^_^
Financial Fundamentals That Every Entrepreneur Should KnowKyle Turriff
This document summarizes a workshop on key financial fundamentals for entrepreneurs. The workshop objectives are to learn important financial terms and concepts, understand corporate obligations, and gain exposure to basic financial management. The agenda covers corporate record keeping requirements, basic financial statements like the income statement and balance sheet, and key metrics like gross margin, breakeven point, customer acquisition cost and lifetime value. Advanced financing concepts are also discussed such as projecting cash flow, evaluating businesses for traditional debt or venture capital, and types of financing. Real-world examples are provided to illustrate financial statement calculations.
The document analyzes various financial ratios for Infosys Technologies Ltd for the financial years 2009 and 2008.
Some key highlights from the ratio analysis include:
1) The company maintained a high liquidity with current ratios of 3.29 in 2009 and 2.10 in 2008. Cash ratios also increased from 4.03 in 2008 to 4.83 in 2009.
2) The company had no debt and sufficient cash flows to meet its strategic objectives and maintain surplus liquidity.
3) Returns on assets marginally decreased from 38.81% in 2008 to 37.83% in 2009 while returns on investment increased from 25.04% to 29.24% over the same period.
Amplify & MaRS DD - Financial FundementalsKyle Turriff
This document provides an overview of key financial concepts and metrics for entrepreneurs. It discusses common mistakes entrepreneurs make related to finances, including a lack of proper documentation and inappropriate draws. The agenda includes reviewing financial terms, metrics like income statements and balance sheets, and accessing financing. Key financial metrics covered are income statements, gross margin, contribution margin, net income, breakeven analysis, and balance sheet basics. Accessing financing through traditional debt is discussed alongside factors like debt ratios, while venture capital is presented as trading equity for funding to meet milestones.
This document discusses various types of financial statement analysis including trend analysis, comparative statements, common size statements, and ratio analysis. It provides templates for comparative balance sheets and income statements showing calculations of amount and percentage changes between periods. It also includes templates for common size statements showing items as a percentage of total capital employed or net sales. Financial statement analysis is used to measure profitability, growth, financial strength, and solvency by analyzing relationships and trends over time from financial statements.
Bisco Misr is an Egyptian food manufacturing company established in 1957. The audit report analyzes the company's performance over 2012-2013. It found that liquidity, profitability, and returns improved from 2012 to 2013. The current ratio and acid-test ratio increased, indicating better management of operating cycles. Operating income return on investment increased from 19.7% to 26.8%, showing more income generated from assets. Most ratios related to receivables, inventory, assets, and profits improved from 2012 to 2013, demonstrating more efficient use of resources and increased effectiveness of the company's management.
The document provides an overview of financial statement and ratio analysis. It discusses the objectives of ratio analysis which include standardizing financial information, evaluating current operations, and comparing performance. It then examines various types of ratios that can be analyzed including liquidity, investment/shareholders, gearing, profitability, and financial ratios. Specific ratios are defined under each category such as current ratio, quick ratio, debt-to-equity ratio, gross profit margin, return on capital employed, asset turnover, and stock turnover. The document emphasizes that multiple ratios should be analyzed over several years for accurate assessment of a firm's financial condition.
The document is a case study presentation analyzing the growth and bank financing needs of Horniman Horticulture. It provides background on the company, analyzes its financial performance and ratios, identifies a working capital issue, and makes recommendations. The company is facing a cash shortage as most of its current assets are tied up in receivables and inventory. It is recommended that the company obtain bank financing through a line of credit and implement policies to better manage accounts receivable, inventory, and payables to improve its cash flow situation.
This presentation is solution of the case 12th from the book "cases in financial management" by joseph m. sulock and John S. Dunkelberg.
( If u study in IBSU and taking George Simongulashvili's course :)) I hope it will help u very much whatever use it well... :)))
P.S this presentation was scored by 100 ^_^
Financial Fundamentals That Every Entrepreneur Should KnowKyle Turriff
This document summarizes a workshop on key financial fundamentals for entrepreneurs. The workshop objectives are to learn important financial terms and concepts, understand corporate obligations, and gain exposure to basic financial management. The agenda covers corporate record keeping requirements, basic financial statements like the income statement and balance sheet, and key metrics like gross margin, breakeven point, customer acquisition cost and lifetime value. Advanced financing concepts are also discussed such as projecting cash flow, evaluating businesses for traditional debt or venture capital, and types of financing. Real-world examples are provided to illustrate financial statement calculations.
The document analyzes various financial ratios for Infosys Technologies Ltd for the financial years 2009 and 2008.
Some key highlights from the ratio analysis include:
1) The company maintained a high liquidity with current ratios of 3.29 in 2009 and 2.10 in 2008. Cash ratios also increased from 4.03 in 2008 to 4.83 in 2009.
2) The company had no debt and sufficient cash flows to meet its strategic objectives and maintain surplus liquidity.
3) Returns on assets marginally decreased from 38.81% in 2008 to 37.83% in 2009 while returns on investment increased from 25.04% to 29.24% over the same period.
Amplify & MaRS DD - Financial FundementalsKyle Turriff
This document provides an overview of key financial concepts and metrics for entrepreneurs. It discusses common mistakes entrepreneurs make related to finances, including a lack of proper documentation and inappropriate draws. The agenda includes reviewing financial terms, metrics like income statements and balance sheets, and accessing financing. Key financial metrics covered are income statements, gross margin, contribution margin, net income, breakeven analysis, and balance sheet basics. Accessing financing through traditional debt is discussed alongside factors like debt ratios, while venture capital is presented as trading equity for funding to meet milestones.
This document discusses various types of financial statement analysis including trend analysis, comparative statements, common size statements, and ratio analysis. It provides templates for comparative balance sheets and income statements showing calculations of amount and percentage changes between periods. It also includes templates for common size statements showing items as a percentage of total capital employed or net sales. Financial statement analysis is used to measure profitability, growth, financial strength, and solvency by analyzing relationships and trends over time from financial statements.
Bisco Misr is an Egyptian food manufacturing company established in 1957. The audit report analyzes the company's performance over 2012-2013. It found that liquidity, profitability, and returns improved from 2012 to 2013. The current ratio and acid-test ratio increased, indicating better management of operating cycles. Operating income return on investment increased from 19.7% to 26.8%, showing more income generated from assets. Most ratios related to receivables, inventory, assets, and profits improved from 2012 to 2013, demonstrating more efficient use of resources and increased effectiveness of the company's management.
The document provides an overview of financial statement and ratio analysis. It discusses the objectives of ratio analysis which include standardizing financial information, evaluating current operations, and comparing performance. It then examines various types of ratios that can be analyzed including liquidity, investment/shareholders, gearing, profitability, and financial ratios. Specific ratios are defined under each category such as current ratio, quick ratio, debt-to-equity ratio, gross profit margin, return on capital employed, asset turnover, and stock turnover. The document emphasizes that multiple ratios should be analyzed over several years for accurate assessment of a firm's financial condition.
All financial ratios of bata shoe of last five years Faiz Subhani
financial analysis of firm's financial statements & horizontal and vertical analysis is also given in this
also explained the purpose of finding each ratio for a firm and how can we compare with its past years and with other organizations and with industry standards
This document discusses various financial ratios used to analyze company performance, including liquidity, asset management, debt, profitability, and market value ratios. It explains how ratios can be used to compare companies and assess financial health. Examples are provided to illustrate how specific ratios like debt-to-asset, times interest earned, and return on equity are calculated and interpreted.
The document presents profitability ratio analyses for Islami Bank Bangladesh Ltd. and Jamuna Bank Ltd. over multiple years. It includes the gross profit margin, net profit margin, return on assets, return on equity, and earnings per share for both banks from 2007-2008 to 2011-2012. Graphs show that for most ratios and years, Islami Bank performed better than Jamuna Bank, with higher gross profit margins, net profit margins, returns on assets and equity, and earnings per share.
Unilever Pakistan Limited (UPL) is the largest FMCG company in Pakistan, established 50 years ago. It produces brands like Surf Excel, Sunlight, Close Up, Fair & Lovely, Lux, Ponds, Dove, Brook Bond, Lipton, Cornetto, Wall's, Knorr, Blue Band and others. UPL has seen growth through acquisitions and mergers over the years. Financial analysis of UPL from 2008-2012 shows increasing liquidity, activity, profitability, and market ratios, indicating improved financial performance and investor confidence over time.
The document analyzes various financial ratios for a company over three years (2011-2013). It summarizes that while the current ratio and cash ratio decreased in 2013 from previous years, they remain above commonly accepted levels, indicating the company may not be efficiently utilizing its current assets and short-term finances. Earnings per share increased each year from 2011-2013, showing growing individual shareholder wealth. The return on equity was highest in 2013, suggesting the company is effectively using financial leverage through debt financing. Finally, the net profit ratio remained satisfactorily high over the three years, being highest in 2012, showing stable profitability.
Financial Ratio Analysis of Samsung for the year 2013-2014Prinson Rodrigues
Financial Ratio Analysis of Samsung For the year 2013-2014
Current ratio
Quick ratio
Debt equity ratio
Capital turnover ratio
Fixed Assets Turnover ratio
Working capital turnover ratio
Stock turnover ratio
inventory conversion period
Debtors turnover ratio
Gross profit ratio
net profit ratio
etc
This document provides an analysis of key financial ratios for Asian Paints for fiscal years 2013 and 2012. It includes liquidity, solvency, activity/turnover, coverage, and profitability ratios. The liquidity ratios show the company's ability to meet short-term obligations. Solvency ratios assess long-term debt obligations. Activity/turnover ratios examine how efficiently the company uses its assets. Coverage ratios evaluate the company's ability to cover interest and debt payments. Profitability ratios measure return on equity, assets, and capital employed. Most ratios show Asian Paints is in a strong financial position.
Chapter 2: Health Care Financial StatementsNada G.Youssef
This document provides an overview of key financial statements and accounting principles for health care entities. It discusses the balance sheet, statement of operations, and accounting standards set by FASB, GASB and GAAP. The balance sheet presents assets, liabilities and net assets at a point in time. The statement of operations summarizes revenues and expenses over an accounting period using the accrual basis. The document also provides examples of components that make up each statement.
This document provides an overview of financial statement analysis for healthcare organizations. It discusses various tools used for analysis, including horizontal analysis, vertical analysis, ratio analysis, and trend analysis. Horizontal analysis compares financial data over time, vertical analysis expresses figures as percentages of a total, ratio analysis examines relationships between figures, and trend analysis compares figures to a base year. The document also outlines common liquidity, profitability, activity, and capital structure ratios used in analysis and provides examples of applying various tools to sample financial statements.
Chapter 8: Capital Financing for Health Care ProvidersNada G.Youssef
This document discusses various methods of capital financing for health care providers, including equity financing through retained earnings or stock issuance, and debt financing through loans, bonds, and lease agreements. It provides examples of calculating bond valuation and rates of return, as well as amortization schedules for loans. Key terms defined include debt service coverage, tax-exempt versus taxable bonds, and operating versus capital leases.
This document provides a presentation on ratio analysis of Nishat Mills Limited, a textile company in Pakistan. It includes an introduction to the company, its mission statement, organizational structure, and product lines. The presentation then covers various financial ratios analyzed for Nishat Mills for 2012-2013, including liquidity, profitability, debt management, and activity ratios. Key findings are that liquidity, profitability, and debt management ratios improved from 2012 to 2013, while some activity ratios declined. The presentation concludes with recommendations for Nishat Mills to improve average collection period, asset turnover ratio, and basic earning power.
- The document provides an overview of a potential acquisition of First Northern Community Bancorp by another company.
- First Northern is a bank headquartered in Dixon, California that focuses on construction, farm, and family loans as well as demand and NOW deposits. It has branches in Northern California near Sacramento.
- Acquiring First Northern would provide access to new markets in Northern California and income from real estate loans. First Northern has no borrowed money on its balance sheet.
- Financial information shows First Northern has decreasing non-performing assets and loans, with an ROE of around 8%, indicating it is a healthy company that could benefit the acquiring company.
The document presents financial statement analysis of Square Pharmaceuticals Ltd. for the years 2012-2013 and 2011-2012. It includes horizontal analysis of the balance sheet, vertical analysis of the income statement, and various ratio analyses related to liquidity, profitability, and solvency. The ratio analyses show the company's current ratio, acid test ratio, inventory turnover, profit margin, EPS, and debt-to-total assets ratio for the periods presented.
The team performed a strategic, financial, and valuation analysis of Procter & Gamble to make an investment recommendation. P&G has a long history and is a global leader in consumer goods with 300 brands. The analysis found strengths in P&G's business model and emerging market growth, but also weaknesses in high competition and commodity costs. Valuation models estimated the stock price could grow moderately assuming the economy improves slowly. The analysis concluded P&G is unlikely to face bankruptcy and would be a fair investment assuming moderate sales growth, recommending investors proceed.
Case Study on comparative finacial performance of BATA India & Shopper's Stop Amitava Sengupta
This document presents financial ratio analyses for two retailers, Shoppers Stop and BATA, for the years ending 2012 and 2011. It includes calculations of liquidity, leverage, asset utilization, and profitability ratios. Key ratios reported are the current ratio, quick ratio, inventory turnover, debt-to-equity ratio, gross profit margin, return on assets, and return on equity. The ratios provide insights into the financial performance and position of the two retailers over the periods analyzed.
ACG Cup 2nd round case competition final presentationliujingyi
This document provides an analysis and recommendation for a potential leveraged buyout (LBO) of Topnotch Technologies. Key points include:
- The proposed LBO would generate an internal rate of return (IRR) of 30.24% over 5 years.
- Managers are key to the success of the deal and their continued involvement is important. They would receive equity rollover and incentive packages.
- The initial offer price is $170 million, financed with senior notes, management equity rollover, and equity from Clearshot Investment Bank.
- An exit strategy after 5 years assumes selling the company at 8.9x EBITDA, the same multiple as the initial valuation.
- The
The document provides an overview and agenda for a business valuation boot camp. It discusses introducing business valuation and reasons valuations are needed. Key topics include defining value, valuation principles and methodologies, and selecting valuation advisors. The presentation covers standard of value, enterprise value versus equity value, asset, income and market approaches. Specific valuation methods like discounted cash flow and guideline public company are demonstrated. The summary emphasizes valuations consider future performance and cash flow, and utilize multiple appropriate methodologies for a defensible conclusion.
The document provides examples of how to calculate various financial ratios used in analyzing financial statements. It includes calculations for current and quick ratios, average accounts receivable and related turnover ratios, inventory turnover ratios, times interest earned ratio, debt and debt to equity ratios, return on sales, return on assets, earnings per share, price earnings ratio, dividend yield, and dividend payout ratio. The document demonstrates how to perform the calculations using financial data from sample company income statements and balance sheets.
The comparative balance sheet shows that between 2019 and 2020:
- Total shareholders' funds increased by Rs. 2,96,000 (+40%) due to increases in share capital and reserves.
- Non-current liabilities decreased by Rs. 1,00,000 (-33.33%) because of a reduction in long-term borrowings.
- Total assets increased by Rs. 2,80,000 (+20.68%) with rises in both non-current and current assets, indicating an overall improvement in the company's financial position.
Why Knowing Profitability Is the Key to Success at Your InstitutionBaker Hill
Most financial institutions don’t understand that the majority of their relationships are not profitable. This results in poor strategic planning especially when dealing with issues with the balance sheet. Senior Management has to understand and deal with different types of risk, along with income statement stagnation in these times of rising interest rates.
CFO Insight For Business Owners: How to Utilize Financial StatementsChase R. Morrison
CFO Insight: This is a primer on how to use financial statements to more effectively operate a privately held business and was used to educate new entrepreneurs at the Valley Economic Development Corporation in Sherman Oaks, CA.
All financial ratios of bata shoe of last five years Faiz Subhani
financial analysis of firm's financial statements & horizontal and vertical analysis is also given in this
also explained the purpose of finding each ratio for a firm and how can we compare with its past years and with other organizations and with industry standards
This document discusses various financial ratios used to analyze company performance, including liquidity, asset management, debt, profitability, and market value ratios. It explains how ratios can be used to compare companies and assess financial health. Examples are provided to illustrate how specific ratios like debt-to-asset, times interest earned, and return on equity are calculated and interpreted.
The document presents profitability ratio analyses for Islami Bank Bangladesh Ltd. and Jamuna Bank Ltd. over multiple years. It includes the gross profit margin, net profit margin, return on assets, return on equity, and earnings per share for both banks from 2007-2008 to 2011-2012. Graphs show that for most ratios and years, Islami Bank performed better than Jamuna Bank, with higher gross profit margins, net profit margins, returns on assets and equity, and earnings per share.
Unilever Pakistan Limited (UPL) is the largest FMCG company in Pakistan, established 50 years ago. It produces brands like Surf Excel, Sunlight, Close Up, Fair & Lovely, Lux, Ponds, Dove, Brook Bond, Lipton, Cornetto, Wall's, Knorr, Blue Band and others. UPL has seen growth through acquisitions and mergers over the years. Financial analysis of UPL from 2008-2012 shows increasing liquidity, activity, profitability, and market ratios, indicating improved financial performance and investor confidence over time.
The document analyzes various financial ratios for a company over three years (2011-2013). It summarizes that while the current ratio and cash ratio decreased in 2013 from previous years, they remain above commonly accepted levels, indicating the company may not be efficiently utilizing its current assets and short-term finances. Earnings per share increased each year from 2011-2013, showing growing individual shareholder wealth. The return on equity was highest in 2013, suggesting the company is effectively using financial leverage through debt financing. Finally, the net profit ratio remained satisfactorily high over the three years, being highest in 2012, showing stable profitability.
Financial Ratio Analysis of Samsung for the year 2013-2014Prinson Rodrigues
Financial Ratio Analysis of Samsung For the year 2013-2014
Current ratio
Quick ratio
Debt equity ratio
Capital turnover ratio
Fixed Assets Turnover ratio
Working capital turnover ratio
Stock turnover ratio
inventory conversion period
Debtors turnover ratio
Gross profit ratio
net profit ratio
etc
This document provides an analysis of key financial ratios for Asian Paints for fiscal years 2013 and 2012. It includes liquidity, solvency, activity/turnover, coverage, and profitability ratios. The liquidity ratios show the company's ability to meet short-term obligations. Solvency ratios assess long-term debt obligations. Activity/turnover ratios examine how efficiently the company uses its assets. Coverage ratios evaluate the company's ability to cover interest and debt payments. Profitability ratios measure return on equity, assets, and capital employed. Most ratios show Asian Paints is in a strong financial position.
Chapter 2: Health Care Financial StatementsNada G.Youssef
This document provides an overview of key financial statements and accounting principles for health care entities. It discusses the balance sheet, statement of operations, and accounting standards set by FASB, GASB and GAAP. The balance sheet presents assets, liabilities and net assets at a point in time. The statement of operations summarizes revenues and expenses over an accounting period using the accrual basis. The document also provides examples of components that make up each statement.
This document provides an overview of financial statement analysis for healthcare organizations. It discusses various tools used for analysis, including horizontal analysis, vertical analysis, ratio analysis, and trend analysis. Horizontal analysis compares financial data over time, vertical analysis expresses figures as percentages of a total, ratio analysis examines relationships between figures, and trend analysis compares figures to a base year. The document also outlines common liquidity, profitability, activity, and capital structure ratios used in analysis and provides examples of applying various tools to sample financial statements.
Chapter 8: Capital Financing for Health Care ProvidersNada G.Youssef
This document discusses various methods of capital financing for health care providers, including equity financing through retained earnings or stock issuance, and debt financing through loans, bonds, and lease agreements. It provides examples of calculating bond valuation and rates of return, as well as amortization schedules for loans. Key terms defined include debt service coverage, tax-exempt versus taxable bonds, and operating versus capital leases.
This document provides a presentation on ratio analysis of Nishat Mills Limited, a textile company in Pakistan. It includes an introduction to the company, its mission statement, organizational structure, and product lines. The presentation then covers various financial ratios analyzed for Nishat Mills for 2012-2013, including liquidity, profitability, debt management, and activity ratios. Key findings are that liquidity, profitability, and debt management ratios improved from 2012 to 2013, while some activity ratios declined. The presentation concludes with recommendations for Nishat Mills to improve average collection period, asset turnover ratio, and basic earning power.
- The document provides an overview of a potential acquisition of First Northern Community Bancorp by another company.
- First Northern is a bank headquartered in Dixon, California that focuses on construction, farm, and family loans as well as demand and NOW deposits. It has branches in Northern California near Sacramento.
- Acquiring First Northern would provide access to new markets in Northern California and income from real estate loans. First Northern has no borrowed money on its balance sheet.
- Financial information shows First Northern has decreasing non-performing assets and loans, with an ROE of around 8%, indicating it is a healthy company that could benefit the acquiring company.
The document presents financial statement analysis of Square Pharmaceuticals Ltd. for the years 2012-2013 and 2011-2012. It includes horizontal analysis of the balance sheet, vertical analysis of the income statement, and various ratio analyses related to liquidity, profitability, and solvency. The ratio analyses show the company's current ratio, acid test ratio, inventory turnover, profit margin, EPS, and debt-to-total assets ratio for the periods presented.
The team performed a strategic, financial, and valuation analysis of Procter & Gamble to make an investment recommendation. P&G has a long history and is a global leader in consumer goods with 300 brands. The analysis found strengths in P&G's business model and emerging market growth, but also weaknesses in high competition and commodity costs. Valuation models estimated the stock price could grow moderately assuming the economy improves slowly. The analysis concluded P&G is unlikely to face bankruptcy and would be a fair investment assuming moderate sales growth, recommending investors proceed.
Case Study on comparative finacial performance of BATA India & Shopper's Stop Amitava Sengupta
This document presents financial ratio analyses for two retailers, Shoppers Stop and BATA, for the years ending 2012 and 2011. It includes calculations of liquidity, leverage, asset utilization, and profitability ratios. Key ratios reported are the current ratio, quick ratio, inventory turnover, debt-to-equity ratio, gross profit margin, return on assets, and return on equity. The ratios provide insights into the financial performance and position of the two retailers over the periods analyzed.
ACG Cup 2nd round case competition final presentationliujingyi
This document provides an analysis and recommendation for a potential leveraged buyout (LBO) of Topnotch Technologies. Key points include:
- The proposed LBO would generate an internal rate of return (IRR) of 30.24% over 5 years.
- Managers are key to the success of the deal and their continued involvement is important. They would receive equity rollover and incentive packages.
- The initial offer price is $170 million, financed with senior notes, management equity rollover, and equity from Clearshot Investment Bank.
- An exit strategy after 5 years assumes selling the company at 8.9x EBITDA, the same multiple as the initial valuation.
- The
The document provides an overview and agenda for a business valuation boot camp. It discusses introducing business valuation and reasons valuations are needed. Key topics include defining value, valuation principles and methodologies, and selecting valuation advisors. The presentation covers standard of value, enterprise value versus equity value, asset, income and market approaches. Specific valuation methods like discounted cash flow and guideline public company are demonstrated. The summary emphasizes valuations consider future performance and cash flow, and utilize multiple appropriate methodologies for a defensible conclusion.
The document provides examples of how to calculate various financial ratios used in analyzing financial statements. It includes calculations for current and quick ratios, average accounts receivable and related turnover ratios, inventory turnover ratios, times interest earned ratio, debt and debt to equity ratios, return on sales, return on assets, earnings per share, price earnings ratio, dividend yield, and dividend payout ratio. The document demonstrates how to perform the calculations using financial data from sample company income statements and balance sheets.
The comparative balance sheet shows that between 2019 and 2020:
- Total shareholders' funds increased by Rs. 2,96,000 (+40%) due to increases in share capital and reserves.
- Non-current liabilities decreased by Rs. 1,00,000 (-33.33%) because of a reduction in long-term borrowings.
- Total assets increased by Rs. 2,80,000 (+20.68%) with rises in both non-current and current assets, indicating an overall improvement in the company's financial position.
Why Knowing Profitability Is the Key to Success at Your InstitutionBaker Hill
Most financial institutions don’t understand that the majority of their relationships are not profitable. This results in poor strategic planning especially when dealing with issues with the balance sheet. Senior Management has to understand and deal with different types of risk, along with income statement stagnation in these times of rising interest rates.
CFO Insight For Business Owners: How to Utilize Financial StatementsChase R. Morrison
CFO Insight: This is a primer on how to use financial statements to more effectively operate a privately held business and was used to educate new entrepreneurs at the Valley Economic Development Corporation in Sherman Oaks, CA.
The document summarizes Leverage, an online lending platform that offers loans to SMEs and startups in the Philippines. It analyzes the financial needs of its clients and connects them to investors and lenders to provide faster funding than traditional banks. Leverage has experienced strong growth, approving over 200 clients and seeing 300% year-over-year growth. It aims to address market inefficiencies for both lenders and borrowers through transparent financials and optimized returns. The company seeks to raise PHP 25 million in capital to further expand its loan portfolio and lower interest expenses.
The document summarizes a business presentation about two different financial plans - the traditional 45-year plan where most people work until retirement with little savings, and an alternative 2-3 year business development plan.
The presentation outlines the 2-3 year plan which involves building a business using a franchising model in direct selling markets like health, beauty and home products. It describes how individuals can generate retail profits on product sales as well as passive residual income by sponsoring others. Examples are given showing how income can grow substantially as more people are sponsored into the business system over time.
The final parts of the presentation encourage the reader to register and get started in the business opportunity by making contact with the presenter, suggesting next
The document discusses ROI incentive management and how it can impact key performance indicators and financial outcomes for a business. It provides examples of how improving indicators like sales, costs of goods sold, operating expenses, accounts receivable days, and inventory turns can increase net profit and cash flow. The key message is that applying ROI incentive management principles and tracking the results of incentive programs can significantly improve a business's financial position in the same way that optimizing different parts of a garden hose's water flow can increase overall output.
This document outlines an accounting course covering fundamental accounting concepts and financial statements. The course objectives are to understand accounting information sources and concepts, how financial data is used for decision making, and controlling operations. Topics include the balance sheet, income statement, cash flows, accounting principles, corporations, and ratio analysis. The course utilizes lectures, assignments, cases, and exams. Managerial accounting is also covered, focusing on cost analysis, budgeting, and decision making.
1. Working capital management is important for any business to sustain itself and involves managing current assets and current liabilities.
2. Taking a narrow accounting view of working capital as just current assets minus current liabilities can ignore important operational factors and risks, while seeing it as involving the entire quote-to-cash, purchase-to-pay, and order-to-delivery processes can help identify risks and opportunities.
3. Firms must determine optimal current asset levels to balance liquidity, profitability, and risk, as more current assets increase liquidity but reduce potential profitability and vice versa.
Ratio analysis involves calculating and comparing various financial ratios to evaluate a company's profitability, liquidity, asset use efficiency, and financial stability. Key ratios include return on investment, return on equity, debt-to-equity, and current ratio. Calculating ratios from multiple periods or against industry benchmarks provides insights into a company's performance over time and relative to its peers.
Ratio analysis involves calculating and comparing various financial ratios to evaluate a company's profitability, liquidity, asset use efficiency, and financial stability. Key ratios include return on investment, return on equity, debt-to-equity, and current ratio. Calculating ratios from multiple periods or against industry benchmarks provides insights into a company's performance over time and relative to its peers.
Presentation slides from seminar looking at how to grow the value of your business, originally presented at Liverpool Crowne Plaza Hotel together with GrowthAccelerator and Natwest Bank
Nonprofit Finance: Basics for the non-MBA, non-CPA professionalDonorPath
The document provides an overview of finance basics for non-profits, focusing on financial statements and the roles of cash, credit, and investment. It discusses the three main financial statements - balance sheet, income statement, and statement of cash flows. It explains key elements of the balance sheet and income statement, including assets, liabilities, net assets, revenues, expenses, and changes in net assets. The presentation aims to help non-finance professionals understand and interpret their organization's financials and tell its financial story as it relates to its mission.
(1) The document provides an overview of key financial concepts for startups, including profit and loss statements, balance sheets, and cash flow statements. (2) It notes that while established businesses have stable finances, startups have unstable business activities that require significant investment and negative cash flows in the early stages. (3) The document emphasizes that startups need to track metrics like cash burn rate, customer acquisition cost, and conversion rates to measure progress and attract investors.
This document discusses evaluating the financial performance of ventures using financial ratios. It describes how ratios related to liquidity, cash burn rates, and profitability are important at different stages of a venture's lifecycle. Specific liquidity ratios like the current ratio and quick ratio are defined and calculated for a sample company. The company's cash burn rates and liquidity ratios increased significantly from 2004 to 2005, indicating declining financial stability.
Finance for Managers
(Managerial Accounting)
Role of Financial Information
• Financial information pervades our economy
– It is the primary means of communication between profit seeking
organizations and their stakeholders
– For this reason organizations use financial measures internally as a broad indicator of performance
• This financial information provides a signal that something is wrong, but not what is wrong
• Financial information summarizes underlying activities
– But to explain financial results, managers need to dig deeper
– Detailed information provides additional insight into what is happening to
profits
1. Financial analytics is a field that provides insights into a company's financial data to improve business performance. It helps gain knowledge and take corrective actions.
2. Key financial metrics analyzed include balance sheets, income statements, and cash flow statements. Financial analytics aids decision making, planning, and risk management.
3. Important financial KPIs include gross profit margin, net profit margin, working capital, current ratio, quick ratio, Berry ratio, cash conversion cycle, accounts payable turnover, and return on assets. These metrics provide insights on profitability, liquidity, efficiency and more.
Webinar creating a_compensation_calendar_everyone_lovesPayScale, Inc.
Compensation is one of the many critical areas of responsibility for most HR teams, and having a well-planned compensation calendar is a key component to your talent strategy.
This webinar will guide you through a typical compensation calendar so you can determine:
The best time to create a comp calendar
How to improve upon your talent planning processes for the coming year
How to integrate your compensation calendar with other responsibilities such as recruitment and benefits
This webinar is approved for 1.0 HRCI re-certification credit.
Preparing Your Exit Strategy from Veterinary PracticeOculus Insights
Dr Mike Pownall presented a half day session during the Oculus Insights 2017 EU Summits in Amsterdam on planning an exit strategy for practice owners for any type of veterinary practice.
A review of the growth of the Israel Genealogy Research Association Database Collection for the last 12 months. Our collection is now passed the 3 million mark and still growing. See which archives have contributed the most. See the different types of records we have, and which years have had records added. You can also see what we have for the future.
This presentation includes basic of PCOS their pathology and treatment and also Ayurveda correlation of PCOS and Ayurvedic line of treatment mentioned in classics.
A workshop hosted by the South African Journal of Science aimed at postgraduate students and early career researchers with little or no experience in writing and publishing journal articles.
How to Build a Module in Odoo 17 Using the Scaffold MethodCeline George
Odoo provides an option for creating a module by using a single line command. By using this command the user can make a whole structure of a module. It is very easy for a beginner to make a module. There is no need to make each file manually. This slide will show how to create a module using the scaffold method.
This slide is special for master students (MIBS & MIFB) in UUM. Also useful for readers who are interested in the topic of contemporary Islamic banking.
Executive Directors Chat Leveraging AI for Diversity, Equity, and InclusionTechSoup
Let’s explore the intersection of technology and equity in the final session of our DEI series. Discover how AI tools, like ChatGPT, can be used to support and enhance your nonprofit's DEI initiatives. Participants will gain insights into practical AI applications and get tips for leveraging technology to advance their DEI goals.
বাংলাদেশের অর্থনৈতিক সমীক্ষা ২০২৪ [Bangladesh Economic Review 2024 Bangla.pdf] কম্পিউটার , ট্যাব ও স্মার্ট ফোন ভার্সন সহ সম্পূর্ণ বাংলা ই-বুক বা pdf বই " সুচিপত্র ...বুকমার্ক মেনু 🔖 ও হাইপার লিংক মেনু 📝👆 যুক্ত ..
আমাদের সবার জন্য খুব খুব গুরুত্বপূর্ণ একটি বই ..বিসিএস, ব্যাংক, ইউনিভার্সিটি ভর্তি ও যে কোন প্রতিযোগিতা মূলক পরীক্ষার জন্য এর খুব ইম্পরট্যান্ট একটি বিষয় ...তাছাড়া বাংলাদেশের সাম্প্রতিক যে কোন ডাটা বা তথ্য এই বইতে পাবেন ...
তাই একজন নাগরিক হিসাবে এই তথ্য গুলো আপনার জানা প্রয়োজন ...।
বিসিএস ও ব্যাংক এর লিখিত পরীক্ষা ...+এছাড়া মাধ্যমিক ও উচ্চমাধ্যমিকের স্টুডেন্টদের জন্য অনেক কাজে আসবে ...
How to Make a Field Mandatory in Odoo 17Celine George
In Odoo, making a field required can be done through both Python code and XML views. When you set the required attribute to True in Python code, it makes the field required across all views where it's used. Conversely, when you set the required attribute in XML views, it makes the field required only in the context of that particular view.
ISO/IEC 27001, ISO/IEC 42001, and GDPR: Best Practices for Implementation and...PECB
Denis is a dynamic and results-driven Chief Information Officer (CIO) with a distinguished career spanning information systems analysis and technical project management. With a proven track record of spearheading the design and delivery of cutting-edge Information Management solutions, he has consistently elevated business operations, streamlined reporting functions, and maximized process efficiency.
Certified as an ISO/IEC 27001: Information Security Management Systems (ISMS) Lead Implementer, Data Protection Officer, and Cyber Risks Analyst, Denis brings a heightened focus on data security, privacy, and cyber resilience to every endeavor.
His expertise extends across a diverse spectrum of reporting, database, and web development applications, underpinned by an exceptional grasp of data storage and virtualization technologies. His proficiency in application testing, database administration, and data cleansing ensures seamless execution of complex projects.
What sets Denis apart is his comprehensive understanding of Business and Systems Analysis technologies, honed through involvement in all phases of the Software Development Lifecycle (SDLC). From meticulous requirements gathering to precise analysis, innovative design, rigorous development, thorough testing, and successful implementation, he has consistently delivered exceptional results.
Throughout his career, he has taken on multifaceted roles, from leading technical project management teams to owning solutions that drive operational excellence. His conscientious and proactive approach is unwavering, whether he is working independently or collaboratively within a team. His ability to connect with colleagues on a personal level underscores his commitment to fostering a harmonious and productive workplace environment.
Date: May 29, 2024
Tags: Information Security, ISO/IEC 27001, ISO/IEC 42001, Artificial Intelligence, GDPR
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Find out more about ISO training and certification services
Training: ISO/IEC 27001 Information Security Management System - EN | PECB
ISO/IEC 42001 Artificial Intelligence Management System - EN | PECB
General Data Protection Regulation (GDPR) - Training Courses - EN | PECB
Webinars: https://pecb.com/webinars
Article: https://pecb.com/article
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For more information about PECB:
Website: https://pecb.com/
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Facebook: https://www.facebook.com/PECBInternational/
Slideshare: http://www.slideshare.net/PECBCERTIFICATION
How to Add Chatter in the odoo 17 ERP ModuleCeline George
In Odoo, the chatter is like a chat tool that helps you work together on records. You can leave notes and track things, making it easier to talk with your team and partners. Inside chatter, all communication history, activity, and changes will be displayed.
it describes the bony anatomy including the femoral head , acetabulum, labrum . also discusses the capsule , ligaments . muscle that act on the hip joint and the range of motion are outlined. factors affecting hip joint stability and weight transmission through the joint are summarized.
5. Who is Oculus?
• Global Business Education Company
• Business Consulting & Management Services
• Industry-Focused Programming
• Relationship/Networking
• Strategic Partnerships
6. The Oculus Learning Opportunities
• 4 Day Immersion programs at different locations in
the worldBusiness Summits
• One-Day, Topic Driven programs not species specificBusiness Workshops
• 3 Year Educational Certificate program not species
specific at MBA level
Veterinary Business
School
Business Consulting • Customized solutions and speaking engagements
7. Joop Loomans DVM, PhD
Utrecht, The Netherlands & China
Robert Magnus DVM, MBA
Wisconsin, United States
Michael Pownall DVM, MBA
Toronto, Canada
Executive Leadership Team
Including: Consortium of business
professionals, industry specialists,
instructors, and coaches
10. Financials 101
• But first some basic understanding is necessary....
• You don’t need to become an accountant
24/07/2017 10
11. What is Financial Accounting
• The preparation and use of accounting
information
• Provided in the form of a company’s financial
statements
• Enables users to make informed decisions
24/07/2017 11
12. Let’s start with the Accounting Equation
24/07/2017 12
Assets Liabilities Equity= +
14. Stocks and Flows
24/07/2017 14
Opening Balance
Sheet
Assets
Fixed
Current
Cash
Liabilities
Shareholders equity
Equity shares
Retained earnings
Closing Balance Sheet
Assets
Fixed
Current
Cash
Liabilities
Shareholders equity
Equity shares
Retained earnings
Statement of Cash Flow
Operating activities
Investment activities
Financing activities
Change in Cash
Income Statement
Revenues
Expenses
Net Income
Beginning of
accounting period
End of
accounting period
15. Balance Sheet: Assets
Tangible and Intangible Economic Value
• Is owned by the company
• Used to generate future benefits
• Assists in providing the products and services of the
business
• Available to meet debts or commitments
• Can be sold or reversed into cash
24/07/2017 15
16. List as many Assets as possible for a ABC
Equine Clinic
•
•
•
•
•
•
•
•
•
24/07/2017 16
17. Balance Sheet: Liabilities
A Liability is an obligation to make a
future payment
•Can be short term or long term
•Can be interest bearing
24/07/2017 17
18. List as many Liabilities as possible for ABC
Equine Clinic
•
•
•
•
•
•
•
•
•
24/07/2017 18
19. Is it OK to have Debt?
• In Personal Life it has often a negative side:
• Can we pay the bills?
• Do we owe enough when we retire?
• In Business Finance:
• An important part of the capital structure
• External financing needed under several curcumstances:
• New buisness
• Heavy investments
• M&A
• Balance out uneven cash flow streams during the year
24/07/2017 19
20. Is it OK to have Debt?
In Business Finance:
• External Financing is in general cheaper than Equity:
• Cost of lending < Return on investment
• Cash rich companies can miss business opportunities:
• Active in M&A
• Share Buy Back
• Cash Dividends
• Some companies, especially Private Equity:
• Highly leveraged (over 90% Liabilities) => During crisis is this
KILLING
24/07/2017 20
21. Is it OK to have Debts?
The trick is to find the right balance between Debt and
Equity
• Every business is different
• Over the Life Cycle financing changes
• Don’t sell your soul to the bank.
24/07/2017 21
22. Balance Sheet:
The difference between a
company’s assets and liabilities
represents the shareholders’
financial stake in a company.
or
• Contribution by owners +
• Retained earnings (net profit)
24/07/2017 22
23. Equity: The Claim on the Assets
• Share Capital / Common stocks
• Share Premium
• Contribution by Owners -/- Drawings by owners
• Retained earnings (profit on the income statement)
24/07/2017 23
25. Income statement
A financial statement that reports a company's
financial performance over a specific accounting
period. Financial performance is assessed by giving a
summary of how the business incurs its revenues and
expenses. This results in showing the net profit or loss
incurred over a specific accounting period.
24/07/2017 25
26. Income Statement
• Looks pretty straightforward BUT:
• Some fundamental choices to be made
24/07/2017 26
Revenue Costs Profit- =
27. Income Statement – arranged in several
different ways for reporting
Incomes Statement (1):
Sales (Revenue)
-/- Costs of Goods Sold
= Gross Profit
-/- All Expenses
= Net Income
Income Statement (3)
Sales / Revenue
-/- Direct Costs
= Gross Profit
-/- Indirect Costs
= EBITDA
-/- Depreciations
= EBIT
-/+ Interest
= Gross Income
-/- Tax
= Net Income
24/07/2017 27
Incomes Statement (2):
Sales (Revenue)
-/- Direct Costs
= Gross Margin (GM)
-/- indirect Costs
= Net Income
Also called the Profit & Loss Statement or P&L
28. How do you List?
Revenue
•
•
•
•
•
•
•
•
24/07/2017 28
Expenses
•
•
•
•
•
•
•
•
29. Costs:Terminology
• Cost of Goods Sold:
• Costs directly related to the production or delivery of services
• Variable Costs:
• Costs that can easily and accurately be traced to the item
producing the revenue
• Fixed Costs:
• Costs that are related to producing the revenue but that
cannot be easily and accurately traced to the item producing
the revenue
• Operating costs:
• Costs that are necessary to run the business but not directly
related to the revenue,services or production
24/07/2017 29
30. Costs: An Overview
Cost of Goods Sold Admin / Operational Costs
Pharmaceuticals Salaries
Medical supplies Social charges and tax
Lab fees T&E
X-ray expenses Education
Animal Food Rent
Materials lease costs Repairs & Maintenance
Waste Utilities
Surgery equipment Office suppplies
Kennel equipment Advertising
Miscellaneous
Depreciation
24/07/2017 30
31. Stocks and Flows
24/07/2017 31
Opening Balance
Sheet
Assets
Fixed
Current
Cash
Liabilities
Shareholders equity
Equity shares
Retained earnings
Closing Balance Sheet
Assets
Fixed
Current
Cash
Liabilities
Shareholders equity
Equity shares
Retained earnings
Statement of Cash Flow
Operating activities
Investment activities
Financing activities
Change in Cash
Income Statement
Revenues
Expenses
Net Income
Beginning of
accounting period
End of
accounting period
33. How Practices are Valued
Buyer & Seller Options
Ways to Increase Value
34. Valuation Methods
1. % of Turnover (Sales)
2. Discounted Cash Flow (DCF)
3. Multiple of EBITDA (Operating Income)
35. % of Turnover (Sales)
Older Method
• higher profitability (margins)
• simple
• no analysis
Historically = 100% of Turnover
36. Discounted Cash Flow (DCF)
The value of an
anticipated revenue
stream (cash) from an
investment made
37. Discounted Cash Flow
The analysis uses future free cash flow projections
and discounts them to arrive at a present value
estimate
38. Sample Practice Income Statement
Benchmark Data
Is the average of 30
equine practices in the
USA in 2016.
Industry
Benchmarks PRACTICE 2016
100.00% Practice Income (Turnover) $ 2,500,000
Expenses
26.39% Total Cost of Professional Services $659,750
19.36% Drugs & Supplies
7.03% Hosptitalation, Lab costs, etc
73.91% Gross Profit $1,840,250
5.67% Administrative Expense $ 141,750
10.22% Facility and Equipment Costs $255,500
45.04% Payroll Costs $ 1,127,250
12.63% Operating Income (EBITDA) $ 315,750
2.79% Depreciation Costs $ 69,750
0.45% Other Income/Expenses ($ 12,500)
9.39% Net Income € 233,500
39. Initial Cash Flow*: 150,000
Year Range: 1-5 6-10
Growth Rate: 3% 3%
Terminal Growth Rate: 1% Discount Rate: 10.32%
Debt Level: 35,000
Year Flows Growth Value
1 154,500 3% 140,047
2 159,135 3% 130,755
3 163,909 3% 122,079
4 168,826 3% 113,979
5 173,891 3% 106,416
6 179,108 3% 99,355
7 184,481 3% 92,762
8 190,016 3% 86,607
9 195,716 3% 80,861
10 201,587 3% 75,495
Terminal Year 203,603
PV of Year 1-10 Cash Flows: 1,048,356
Terminal Value: 818,138
Total PV of Cash Flows - Total Value 1,866,494
Total Value - Outstanding Debt: 1,831,494
Total Value X Marketability Discount 40% 1,098,896
Discounted Cash Flow Valuation (DCF)
*cells in yellow can be changed to fit your assumptions
Risk Free Rate 2.00%
Beta 1.04
Market Rate of Return 10.00%
Discount Rate 10.32%
Effective Tax Rate 30%
Buyout Percentage 25%
Term 10
Interest Rate 4%
Loan Amount 274,724
Payment € -33,870.99
Available Cash Flow 150,000
New Partner Cash Flow 37,500
Discount Rate Assumptions
Note Terms
Practice Value
Net Cash Flow
37,500 – 33,870
= $ 3,630
Practice Turnover = 2,500,000
40. Projections & Assumptions
Discounted Cash Flow Valuation (DCF)
*cells in yellow can be changed to fit your assumptions
Initial Cash Flow*: 150,000
Year Range: 1-5 6-10
Growth Rate: 3% 3%
Terminal Growth Rate: 1% Discount Rate: 10.32%
Debt Level: 35,000
6% Sales
Low Debt
Interest Rate
On Investment
46. EBITDA
Earning Before Interest Taxes Depreciation Amortization
Revenue
Expenses
- Variable costs
- Fixed costs
= Operating Income (EBITDA)
+/- other expenses, interest
+/- other income
- taxes, depreciation, amortization
Net Income
EBITDA is an estimate of company cash flow
47. EBITDA & Multiple Benchmarks
North America
Equine Practice
Companion Animal Practice
3 – 6X EBITDA (Normalized)
Average = 12%
Range = 3% - 21%
3 – 8X EBITDA (Normalized)
Average = 15%
Range = 3% – 25%
48. Multiples for Small Animal Veterinary Hospitals
20x
18x
16x
14x
12x
10x
8x
6x
4x
2x
0x
0 1 2 3 4 5 6............200………..2,500
Single Site Clinic
1 DVM
3-5x EBITDA
Single Site
multi-DVM
4-10x
Specialty
Hospital
10-15x
20+ site
Corporation
10-15x
Revenue ($millions)
EBITDAMultiple
Valuations have
trended higher in
recent years due to
increased competition
for acquisitions
Sources: Company disclosures and guidance from private equity investors
49. Risk
If Practice A has an operating margin of 4% on
$3 million in net sales and Practice B has an
operating margin of 12% on $3 million in net
sales, Practice A may have a difficult time
covering its fixed costs if business declines in a
given year.
Practice B, on the other hand, has a comfortable
buffer to account for hard financial times.
Effect on Valuation Price
Practice A Multiple = 3
Practice B Multiple = >5
52. Building Practice Value
1. Increase Turnover (Sales Growth)
2. Increase Operating Margin (EBITDA)
3. Lower Risk
4. Decrease Practice Debt
2016 2015 2014
Annual Sales $1,704,935 $1,461,225 $1,348,197
EBITDA X 5 $914,060 $714,720 $294,080
Less Long Term Debt $130,331 $176,007 $99,400
Value of Practice $783,729 $538,713 $194,680
Prior Year Value Rate Change 45.5% 176.7% X
60. The target group for this survey exists of the Veterinary students of all
stages of study from all over the globe. We have been collecting answers
from 31 of October 2014 till 31 of January 2015. In total, 3111 students
from 89 countries participated in the survey. Survey was done online and
it was anonymous.
61.
62. Federation of Veterinarians of Europe
www.fve.org
4 FVE Sections
UEVP (Practitioners)
UEVH (Hygienists – Public Health Officers)
EASVO (Veterinary State Officers)
EVERI (Education, Research, Industry)
Federation of veterinarians
of Europe
46 national organisations
38 European countries
63. Content report:
5 chapters + country reports
1. Demography
2. Demand veterinary services
3. Veterinary practices
4. Working as a vet
5. Future of veterinary profession
See: www.fve.org
64. www.fve.org
FVE Survey of the Veterinary Profession in Europe
24 FVE Member Organisations
participated fully
2 partially (provided results of own
surveys)
> 13 000 vets replied to the
survey (statistical confidence +/-0,85 % at
95% conf. level)
Results reflect personal
understanding, perspective and
knowledge of the individual vets.
This can divert from national
statistics.
65. www.fve.org
Key findings demography
DEMOGRAPHY
• Estimated number of veterinarians in European Union (EU 28) 182 900
in Europe (FVE 38): 243 000
• 44 % aged under 40 years
• 53 % female / 47% male
• 78 % work full-time
• Reported unemployment is 3 % (reality probably higher)
• Private practice dominates, employing 60 % of veterinarians
• 19 % work in public service
• 48 % work with/on issues related to companion animals
71. www.fve.org
Key findings demand veterinary services
DEMAND
Long term downward trend pigs, poultry, cattle and sheep
Dogs: stable, cats: slight increase
Nothing about trends on horses
104 million cattle
150 million pigs
90 million sheep
13 million goats
417 million poultry
157 million companion animals
6 million horses
59 million exotics
71
72. www.fve.org
DEMAND
72
Market Value
• Total value of market for Veterinary Services in private practice in the 24
surveyed countries is estimated at 11.1 billion €
• On average 111 000 € per veterinarian
• This varies from 300 000 € (NO) to <20 000 € (BG, RO, SK)
- Belgium: 107 000 €
- Germany: 181 000 €
- Netherlands: 152 000 €
73. Revenue by type of Service – Europe
Share of revenue: treatment 52%, surgery 20%, medicine sales 13%,
official tasks 4%, food sales 6% and other 5%
In countries with decoupling medicine prescription and distribution,
less on medicines
DEMAND
73
As percentage of total amount
74. Average revenue per practice
The average practice revenue figures are as reported and have not been
adjusted to take account of purchasing power
Vets
and nurses
24
countries
BE DE NL
1 person 85.318 € 103.280 € 92.215 € 98.551 €
2 persons 163.097 € 153.250 € 249.424 € 181.455 €
3 – 5 persons 312.313 € 360.455 € 298.516 € 308.075 €
6 -10 persons 794.386 € 986.000 € 506.634 € 496.256 €
11 – 30 persons 1.414.384 € 1.000.000 € 1.128.205 € 1.179.648 €
31 – 50 persons 3.394.478 € 2.573.333 € 4.122.000 €
> 50 persons 6.488.876 €
74
75. www.fve.org
Key findings working as a veterinarian
WORKING AS A VETERINARIAN
Average earnings: €38 500 (adjusted for Purchasing Power Parity PPP)
Large difference in average earnings between countries: from 9 506€
to 63 579€
Outside practice, highest salaries in industry and research
Male veterinarians earn on average 28% more than female
veterinarians
28% of vets do not have a pension plan, and many who have a plan
do not think it is adequate for their needs
Vets are a mobile profession; 6% worked in another country in last 3
years 75
80. www.fve.org
Key findings in respect to the future
THE FUTURE
• 68% believe that “Too many newly qualified veterinarians are emerging
from Veterinary schools”
• Areas where more veterinarians will be needed:
animal welfare
Companion animals & exotic animals
disease control
Environment
• In order to meet the challenges of the next five years:
83 % think more specialization is needed
80 % think more business training is needed
49 % think more legislation for the profession is needed
80
90. Current Consolidations
• Mainly USA, UK, Northern Europe
• Mainly Companion Animals
• Exit Strategy for Older Practice Owners
• Is it a “Game Changer”?
• Remains a Traditional Model?
• What does it mean for you and our
profession?
95. PRACTICE 2016
Practice Income (Turnover) $ 2,500,000
Expenses
Total Cost of Professional Services 659,750
Drugs & Supplies
Hosptitalation, Lab costs, etc
Gross Profit 1,840,250
Administrative Expense 141,750
Facility and Equipment Costs 255,500
Payroll Costs 1,127,250
Operating Income (EBITDA) 315,750
Depreciation Costs 69,750
Other Income/Expenses -12,500
Net Income $ 233,500
6% Increase in Sales (Turnover)
Increase Turnover
6% $150,000
Change
$699,335
Change Change % Variance
$ 343,915 8.92% $ 28,165
Value
Change
$ 140,825
@ 5x
EBITDA
96. Increasing EBITDA
1. Increase Revenue
2. Lower Expenses
• Inventory/Cost of Goods
• HR
• Cash Payments
• Owners Expenses
The greater the cash flow, the greater the value
110. What Does Improvement in
Inventory Look Like?
Example – Ave Days Inventory
Ending Inventory/(COG/365)
125,000/(659,750/365) = 125,000/1808 = 69
111. What Does Improvement in
Inventory Look Like?
What does each in improvement look like?
125,000/(659,750/365) = 125,000/1808 = 69
Each day improvement equals
125,000/69 = $1,812
112. PRACTICE 2016
Practice Income (Turnover) $ 2,500,000
Expenses
Total Cost of Professional Services 659,750
Drugs & Supplies
Hosptitalation, Lab costs, etc
Gross Profit 1,840,250
Administrative Expense 141,750
Facility and Equipment Costs 255,500
Payroll Costs 1,127,250
Operating Income (EBITDA) 315,750
Depreciation Costs € 69,750
Other Income/Expenses -$ 12,500
Net Income $ 233,500
Decrease Drug Costs
Change
-2.00% $ 50,000
Change Change % Variance
$ 365,750 15.84% $ 50,000
Value
Change
$ 250,000
@ 5x EBITDA
2% Improvement/Reduction of Inventory Costs
113. Examples – Increasing Value
Decrease Drug Costs by 2%
• EBITDA increases by 15.8%
• Practice Value Increases by
Increase Revenue by 6%
• EBITDA increases by 8.9%
• Practice Value Increases by
$ 250,000
$ 140,825
118. Cost of Employee Turnover
• 50-75% of salary
• $30,000 salary
• $15,000-22,500 annual cost each
3 = $45,000-67,500
http://www.zanebenefits.com/blog/bid/312123/Employee-Retention-The-Real-Cost-of-Losing-an-Employee
119. Employee Engagement
“Customers will never love
your company, until the
employees love it first”
Simon Sinek
http://sloanreview.mit.edu/article/measuring-the-benefits-of-employee-
engagement/
124. PRACTICE 2016
Practice Income (Turnover) $2,500,000
Expenses
Total Cost of Professional Services 659,750
Drugs & Supplies
Hosptitalation, Lab costs, etc
Gross Profit 1,840,250
Administrative Expense 141,750
Facility and Equipment Costs 255,500
Payroll Costs 1,127,250
Operating Income (EBITDA) 315,750
Depreciation Costs 69,750
Other Income/Expenses -$ 12,500
Net Income $ 233,500
Creative Financing
Cash $ 25,000
Kids $ 3,500
Home $ 41,000
College $ 20,000
Value
Change
-$ 447,500
@ 5x
EBITDA
Getting Ready to Sell
143. Mission
Purpose = “why are we here?”
“to give horse people peace of mind with
the health care of their horse by
helping them make informed decisions”
144. Core Values – Why?
•Support your mission
•Reflect the culture of the company
•Provide guidelines and expectations for
behaviour of staff AND a lens through
which decisions should be made
146. Vision
Vision = “what is your overall goal?”
“Our goal is to be a global equine
veterinary business recognized for
leadership & innovation in patient,
client and employee care”
153. Phone Screening Process
•Go over interview process
•What attracted you to apply for this
role?
•What are you looking for in a position?
•How much do you know about the
company?
•Wage expectations/start date
154. Interview Structure
• Introductions
• Housekeeping
• What do they know about you?
• Describe the position + company
• Ask about the resume/past experience
• Behavioural/Situational questions
• Applicant questions?
• Wrap up
155. Behavioral Questions
•“Tell me about a time when you had to
deal with a client who was irate. What
was the outcome?”
•The best predictor of future behavior is
past behavior
156. Behavioral
• (Take Ownership – Emotional Intelligence and Self-
Awareness) Have you ever had to work with
someone with whom you didn't like or just couldn't
get along with? How did you cope with this
situation?
• (Take Ownership - Accountability) Tell me about a
time when you made a mistake in the workplace.
How did you deal with it? What steps did you take
to ensure that it didn't happen again?
157. Situational Questions
•“What would you do if you had to deal
with a client who was upset, but in this
instance you knew for sure they were in
the wrong?”
•See how applicant really thinks – can’t
use rehearsed answers
158. Situational
•(Take Ownership – Integrity and
Honesty) “What would you do if a client
asked you to change their horse’s
medical records before sending them to
the insurance company?”
•(Collaborate – Team Focus) “What
would you do if you saw that one of
your colleagues was struggling with
their workload?”
159. Curve Balls
• Who inspires you? Why?
• What would your friends or family say is the
biggest misperception someone might have
about you when they first meet you?
• What book are you reading? Tell me what you
like about it.
• If you could visit anywhere in the world, where
would it be?
• What has been your biggest
disappointment/regret in life?
160.
161. Why Have Structured Training?
•Better adjustment to the workplace
•Structure increases chances for success
•Consistency
•Clear Expectations
•Increased Self-Confidence
•Increased engagement.
• Alan M. Saks, Jamie A. Gruman, (2011) "Getting newcomers engaged: the role of socialization tactics", Journal of
Managerial Psychology, Vol. 26 Iss: 5, pp.383 - 402
162. ABC Equine Clinic Training
GENERAL ORIENTATION - CSR TRAINING
1. First Day/Week General Orientation
History of ABC Equine Clinic
Vision Statement
Core Values
2. General Office Administration
Policies and Procedures Manual
Phone List, Positions and Contacts
Time Sheet/Absence Request forms
Personal Expense Report
Meetings Overview
Clinic Information (Keys, Alarm, Open/Close Procedures, Etc)
3. Computer Network Orientation
Accessing the Network (Computer Access Document)
Network Orientation (remote vs. local, P: Drive, etc)
Skype
4. Customer Service Protocol
Telephone Etiquette
MPES Customer Experience and Charter
Customer Service Training By Position
164. Vet Training and Mentorship
•Mentoring Guidelines
•Define roles and support system
•Regular meetings and follow-up
•Training/Skill Set Outline
165.
166. Why Do Reviews?
• Formal comprehensive discussion regarding
performance
• Basis for goal setting for entire year
• Provide expectations and guidelines for
desired behaviours
• Tie personal behaviour to Culture, Strategy,
Vision
• Provide guidance for wage increases and
bonus calculations
167. Employee Engagement
“Customers will never love
your company, until the
employees love it first”
Simon Sinek
http://sloanreview.mit.edu/article/measuring-the-benefits-of-employee-
engagement/
168. Why do we care if they care?
• Gives them a voice – find out if their
priorities as an employee are being met
• Expose areas where we are doing well and
meeting your expectations
• Identify and target areas for improvement
• Ensure that we continue to be a place
where people like to work
• Help us plan for the future
169. The Survey
•34 Questions online via
SurveyMonkey
•Anonymous other than job role
and clinic
•5 point rating scale
•Area for comments after each
question
170. The Survey
Career Development
I am satisfied with my opportunities for growth within the practice.
I am satisfied with the internal (in-house) job-related training the practice
offers.
I am satisfied with the amount of time and money the practice invests in my
CE (training courses offered by outside sources - courses, workshops, etc.)
171. The Survey
Work Engagement
I am inspired to meet my goals at work.
I feel like I have the all the support I need to meet my goals at work.
I get excited about going to work.
I am proud to tell people where I work.
I have a sense of ownership and pride in the practice.
When the company succeeds, I feel like the success is my own.
I am content to spend the rest of my career at the practice.
Employees adapt quickly to difficult situations at the practice.
Employees at the practice take the initiative to help other employees when the
need arises.
Employees at the practice are willing to take on new tasks as required.
172. The Survey
Compensation and Benefits
I feel that the number and complexity of tasks and the general workload at the
practice are manageable.
Employees at the practice willingly accept and embrace change.
I feel that I am compensated appropriately overall (including wage/salary and
bonus).
I am compensated fairly relative to similar/the same positions in similar
businesses in my area.
I am confident that the method used to determine my wage or salary increases
on a yearly basis is fair.
I am satisfied with my total benefits package (wage, bonus, medical and dental
plans, vacation days, paid personal/sick days).
I am satisfied by the workplace flexibility offered by the practice.
My role at the practice allows me to have an appropriate work-life balance.
173. The Survey
Relationship Management
Communication between management and employees is excellent at the
practice.
I am involved in the decisions that affect my work at the practice.
Management at the practice recognizes strong job performance.
My coworkers and I have an excellent working relationship.
Senior management and employees trust and respect each other at the practice.
174. The Survey
Work Environment
The work at this veterinary praxis positively impacts people's lives.
I am happy with the overall culture of the practice.
I understand how our Core Values relate to expectations around my behaviour at work, and
my work itself.
I feel like the management and staff of the practice adhere to the Core Values.
I understand how my work impacts the business goals of the practice.
179. Job Hunting
•92% were looking for another job
•“My main goals are to be satisfied with
my job and to make sure I earn the
highest possible level of compensation.
If I find a better place in terms of these
aspects, then there is no harm in
changing jobs.”
181. What we have to acknowledge
• People add Value
• Customer and
Patient Focus
• This is a People
Business
182. • Define and communicate a strategy
• Determine what you are going to be the best in the world
at—operations, innovation, or customer intimacy
• Execution is much harder than formulation
• Avoid flavor of the month—pick something and stick with it
• Pick goals that are aligned with the strategy and shareholder
value
• Focus on creating a culture of employee engagement
Jim Woodrum – EBMS Paris 2015
Kellogg School of Management - Northwestern University -USA
What Leaders need to do!
183. Key Points
• Unhappy staff is expensive
• Develop the culture you want
• Hire for the culture
• Train
• Review
• Test
60 years international management experience
Committed Full time
Joop
Large Private practice for over 15 years
Ran Large animal University Hospital – Utrecht
Designed and Built the 1st Western Medicine Hospital in Main Land China
600+ Horses
200+ staff
Bob
Startup - $5M business
Referral Hospital & Mobile Services
Annual Sales $5.0M
11 Veterinarians
25 Staff
One Location
Regional & National Brand
Mike
Referral Outpatient & Mobile Services
Annual Sales $4.2M
10 Veterinarians
20 Staff
Multiple Locations
Common Thread – Operations
Oculus – business education courses – creating an incredible network past 15 years
Do you have screenshots of this with a 4 or 5% growth rate?
Illustrate crowded small animal market and high multiples.
Despite high multiples in small animal practices, equine multiples are still reasonable at 3-5x EBITDA
No structural difference – buy cheaper
58
59
Development of position papers with messages towards all directions
Development of position papers with messages towards all directions
Development of position papers with messages towards all directions
Development of position papers with messages towards all directions
Use examples to show this.
Have the crowd calculate their turnover (privately) ~5 minutes
MIT article
Show effect of cash on EBITDA
Show effect of cash on EBITDA
Add income statement
Use slides of Ronaldo and Real Madrid
Show of hands, how many clinics have core values?
At the end of the list – does anyone see any challenges with the above?
Tell you the WHAT (intangible) but not the HOW (tangible)
How
Focus groups – mix of new and long-time EEs. Brainstorm what your practice “is” – throw it at the wall.
Compare and call what is too similar
Who is sean sparling?
How are you hiring right now?
Use excel grid – questions on L axis, name of person at top.
Sections for “Bottom Line”, “Overall Impressions”
Talk about culture fit!
Assessing emotional intelligence, ability to think on feet, sincerity
Who?
Culture fit
Broom test – do they offer to help sweep/clean up
Bar/restaurant experience (service, dealing with assholes, collecting money, cleaning up after people, curveballs)
People with personal resiliency
How many brilliant vets do you know that have no caseload. People business
Nobody likes to do them. Let’s talk about our worst review experiences