ACC 280 Week 5 Team work
-
date post
13-Sep-2014 -
Category
Technology
-
view
1.604 -
download
0
description
Transcript of ACC 280 Week 5 Team work
Invest in SouthwestInvest in Southwest
Angela PettitAngela PettitBeatrice EjamBeatrice EjamRenee HannaRenee HannaJames RobersonJames RobersonIvelisse ColonIvelisse Colon
Angela PettitAngela PettitBeatrice EjamBeatrice EjamRenee HannaRenee HannaJames RobersonJames RobersonIvelisse ColonIvelisse Colon
ACC/280ACC/280May 12, 2008May 12, 2008Samuel SmithSamuel SmithUniversity of PhoenixUniversity of Phoenix
ACC/280ACC/280May 12, 2008May 12, 2008Samuel SmithSamuel SmithUniversity of PhoenixUniversity of Phoenix
IntroductionIntroductionIntroductionIntroduction
Southwest History & Southwest Today
Cash and Cash Equivalent Southwest Two Largest
Current Assets. Southwest Current Assets &
Liabilities Southwest Profit Margin Southwest Liabilities &
Assets Turnover Invest in a Company That
Always
Southwest History & Southwest Southwest History & Southwest TodayToday
Herb Kelleher & Rollin Herb Kelleher & Rollin KingKing
Started out with three Started out with three aircraftaircraft
Southwest History & Southwest Today(Cont.)
Largest airline worldwide Fleet and flights Consistent profit
Cash and Cash Equivalent
Three years comparison
2007 Cash and cash equivalent in millions = $2,213
2008 Cash and cash equivalent in millions = $1,368
2009 Cash and cash equivalent in millions = $1,114
Three years comparison
2007 Cash and cash equivalent in millions = $2,213
2008 Cash and cash equivalent in millions = $1,368
2009 Cash and cash equivalent in millions = $1,114
Cash and Cash Equivalent (Cont.)
CASH AND CASH
EQUIVALENT GRAPH
CASH AND CASH
EQUIVALENT GRAPH
HORIZONTAL ANALYSIS
Percentage difference from 2007 to 2008 38.2%
Percentage from 2007 to 2009 was 49.7%
HORIZONTAL ANALYSIS
Percentage difference from 2007 to 2008 38.2%
Percentage from 2007 to 2009 was 49.7%
Southwest Current Assets(Using Vertical Analysis)
SOUTHWEST AIRLINES, INC.(Partial) CONDENSED BALANCE SHEET
DECEMBER 31, 2009
IN MILLIONS
ASSETS 2008 Percent 2009 PercentCurrent assets:
Cash and cash equivalent $1,368 51.6% $1,114 33.2% Short-term investments 435 16.4% 1,479 44.0%
Southwest Current Assets & Liabilities
Current Ratio = Current Assets Current Liabilities
2009 2008 $3,358 Billion = 1.26:1 $2,653 Billion = 0.95:1$2,676 Billion $2,806 Billion
Working Capital = Current Assets – Current Liabilities 2009 2008$3,358 - $2,676 = $682mil $2,653 - $2,806 = ($153)mil
Southwest Profit Margin(Net Income)
2009 2008 2007
$99 million $178 million $645 million
Difference from 2008
$79 million
Difference from 2007
$467 million
Southwest Profit Margin (Cont.)(2009 & 2008)
NET INCOME =
PROFIT
NET SALES
MARGIN
2009 2008
$99 Million = 1.00% $178 Million = 1.6%
$9,861Billion
$11,023 Billion
Southwest Liabilities & Assets Turnover
SOUTHWEST AIRLINESCONDENSED BALANCE SHEET (PARTIAL)
31-DecIncrease or (Decrease)
during 2009 In millionsCurrent Liabilities 2009 2008 Amount Percent Accounts payable 746 668 78 11.7% Accrued liabilities 696 1012 (316) -31.2% Air traffic liability 1044 963 81 8.4% Current maturities of long-term debt 190 163 27 16.6% Total Current Liabilities 2676 2806 (130) -4.6%
Long-term Liabilities Long-term debt less current maturities 3325 3498 (173) -4.9% Deferred income taxes 2207 1904 303 15.9% Deferred gains from sale and leaseback of aircraft 102 105 (3) -2.9% Other noncurrent liabilities 493 802 (309) -38.5% Total Long-term liabilities 6127 6309 (182) -2.9%
Total Liabilities 8803 9115 (312) -3.4%
Southwest Liabilities & Assets Turnover (Cont.)
Southwest Airline 2009 2008
$10,350,000 $11,023,000
$14,068,000 + $14,269,000 = .73 times $16,772000 + $14,068,000 = .71 times
2 2
Industry Average
.71 times
Invest in a Company That Always
Focuses on improving profitability
Finds inventive ways to contain cost
Maximizes productivity Finds new ways to improve
the customer experience
Any Questions?