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Case 11 Horniman Horticulture
Case 11 Horniman Horticulture
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Balance sheet
Cash 120.1 105.2 66.8 9.4
Accounts receivable 90.6 99.5 119.5 146.4
Inventory1 468.3 507.6 523.4 656.9
Other current assets2 20.9 19.3 22.6 20.9
Current assets 699.9 731.6 732.3 833.6
Net fixed assets3 332.1 332.5 384.3 347.9
Total assets 1032.0 1064.1 1116.6 1181.5
1
Inventory investment was valued at the lower of cost or market. The cost of inventory was
determined by accumulating the costs associated with preparing the plants for sale. Costs that
were typically capitalized as inventory included direct labor, materials (soil, water, containers,
stakes, labels, chemicals), scrap, and overhead.
2
Other current assets included consigned inventory, prepaid expenses, and assets held for
sale.
3
Net fixed assets included land, buildings and improvements, equipment, and software.
4
Purchases represented the annual amount paid to suppliers.
Exhibit 2
HORNIMAN HORTICULTURE
Financial Ratio Analysis and Benchmarking
Return on assets (Net profit / Total assets) 3.2% 2.4% 4.7% 5.1% 2.9%
Return on capital (Net profit / Total capital) 3.3% 2.5% 4.8% 5.4% 4.0%
Receivable days (AR / Revenue * 365) 41.9 45.0 48.0 50.9 21.8
Inventory days (Inventory / COGS * 365) 424.2 432.1 436.5 476.3 386.3
Payable days (AP / Purchases * 365) 15.6 13.3 10.2 9.9 26.9
NFA turnover (Revenue / NFA) 2.4 2.4 2.4 3.0 2.7
1
Benchmark figures are based on 2004 financial ratios of publicly traded horticulture producers.