Report to Shareholders
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Transcript of Report to Shareholders
REPORT TO SHAREHOLDERS
TERYN JOHNSONKELLY LISZEWSKI
HSIN TARNG OLIVIA KARCH
Chester Co.
Table of Contents
Our Strategy SWOT
Contribution Margin Market Share Customer Awareness Cash Flow
DuPont ROA ROS ROE Leverage Ratio
Porters Five Forces Future Projections Return to Shareholders Closing
Our Strategy
Differentiator with Product Lifecycle Focus Segment Focus:
Traditional Low End High End
Specific Focus: Research and Development Marketing Investment
SWOT Analysis
•Contribution Margin•Research and Development•Marketing Approach
•Asset Liquidity •Sales Forecast
•Capacity Forecast•Cost Savings
•Production Constraints•Leverage Ratio•Company Profitability
Contribution Margin: Traditional
2015 2016 2017 2018 2019 2020 2021 2022
Traditional (Chester) 32% 29% 30% 38% 36% 35% 36% 36%
Traditional (Baldwin) 29% 30% 34% 38% 42% 37% 35% 31%
32%
29% 30%
38%36%
35%
36% 36%
20%
25%
30%
35%
40%
45%
50%
55%
60%
Contribution Margin
Year
Contribution Margin: Low End
2015 2016 2017 2018 2019 2020 2021 2022
Low End (Chester) 29% 32% 25% 36% 31% 33% 29% 30%
Low End (Baldwin) 27% 27% 35% 43% 40% 35% 34% 29%
29%32%
25%
36%
31%
33%29%
30%
20%
25%
30%
35%
40%
45%
50%
55%
60%
Contribution Margin
Year
Contribution Margin: High End
2015 2016 2017 2018 2019 2020 2021 2022High End (Chester) 34% 36% 34% 36% 35% 33% 32% 34%
High End (Baldwin) 35% 35% 35% 39% 35% 38% 29% 28%
34%36%
34%
36% 35%
33%
32%34%
20%
25%
30%
35%
40%
45%
50%
55%
60%
Contribution Margin
Year
SWOT
Market Share vs. Industry
Company Market Share
Market Share vs. Competition
SWOT
Customer Awareness Analysis
0%10%20%30%40%50%60%70%80%90%
100%
2015 2016 2017 2018 2019 2020 2021 2022
Traditional (Baldwin) High End (Baldwin) Low End (Baldwin)
Traditional Low End High End
SWOT
Cash Flow
SWOT
Units of Inventory on Hand
16,394
4,857
20,297 18,448
44,195
10,106
27,834
5,926
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
2015 2016 2017 2018 2019 2020 2021 2022
Chester Competitor (Baldwin)
SWOT
DuPont Model Analysis
ROEROA
ROS
Inv. Turnove
rLeverage
Return on Equity vs. Competitor
29%
21%
31%
14%
19%
1%
10%10%
0%
5%
10%
15%
20%
25%
30%
35%
20222021202020192018201720162015
Competitor (Baldwin) Chester
DuPont
Return on Assets
5.43%
4.77% 0.36%
9.59%
6.90%
20.99%
15.00%
21.20%
0%
5%
10%
15%
20%
25%
2015 2016 2017 2018 2019 2020 2021 2022
ROA
Year
Chester Competitor (Baldwin)
Return on Assets: Total Sales
Return on Assets: Total Assets
DuPont
$-
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
Ches
ter
Bald
win
Ches
ter
Bald
win
Ches
ter
Bald
win
Ches
ter
Bald
win
Ches
ter
Bald
win
Ches
ter
Bald
win
Ches
ter
Bald
win
Ches
ter
Bald
win
2015 2016 2017 2018 2019 2020 2021 2022
Baldwin Total Assets Chester Total Assets
Leverage Ratio Analysis
1.41.41.50
2.102.00
2.5
2.11.9
0
0.5
1
1.5
2
2.5
3
20222021202020192018201720162015
Leve
rage
Rati
o
Competitor (Baldwin) Chester
DuPont
Return on Sales vs. Competitor
11%
9%
13%
6%
7%
0%
4%5%
0%
2%
4%
6%
8%
10%
12%
14%
20222021202020192018201720162015
Competitor (Baldwin) Chester
DuPont
Porter’s Five Forces
Future Projections
$20.22 $14.73 $20.85 $27.11 $35.40 $46.45 $61.24 $81.12
$137.56 $143.62 $183.91
$216.84
$283.19
$371.58
$489.88
$648.96
$-
$100.00
$200.00
$300.00
$400.00
$500.00
$600.00
$700.00
2020 2021 2022 2023 2024 2025 2026 2027
Price
(Ear
ning
)
EPS Share Price
Return to Shareholders
Dividend Payout Continually increasing our Cash Position
Pay out a growing dividend • Want to average dividend growth at 1% year to year
Increases Chester’s Stock Intrinsic Value
Stock Price Growth Grow our Earnings Per Share at 2% each year
Continually increasing Stock Price
Closing
Maintaining Industry Leadership Research and Development Approach Additional Cash Investment
Continued Growth in the Future New sales forecast model
Minimizing inventory carrying costs
Any Questions?
Works Cited
Capsim Portal. N.p., n.d. Web. 22 Apr. 2014. <http://new.capsim.com/student/portal/index.cfm?template=dashboard&CFID=1474539&CFTOKEN=9538c5727d704a0c-4D974D8D-F062-C5B0-FBB346CAE620E9BC>.
ADDITIONAL MATERIAL FOR REFERENCE
Supplemental Slides
Customer Awareness Analysis
71% 69% 70%68%60%
64%
Traditional Low End High End
Customer Awareness-2018
Chester Competitor (Baldwin)
89% 88% 88%
76%
63%
78%
Traditional Low End High End
Customer Awareness-2022
Chester Competitor (Baldwin)
Customer Awareness Analysis
Chester 2015 2016 2017 2018 2019 2020 2021 2022
Traditional 54% 61% 67% 71% 73% 76% 84% 89%
Low End 52% 59% 66% 69% 72% 75% 83% 88%
High End 53% 61% 66% 70% 73% 77% 82% 88%
Competitor (Baldwin) 2015 2016 2017 2018 2019 2020 2021 2022
Traditional (Baldwin) 57% 61% 63% 68% 70% 72% 74% 76%
Low End (Baldwin) 54% 56% 57% 60% 59% 60% 62% 63%
High End (Baldwin) 51% 55% 58% 64% 69% 72% 75% 78%
Customer Accessibility Analysis
69% 70% 71%69%65% 68%
Traditional Low End High End
Customer Accessibility-2018
Chester Competitor (Baldwin)
89%94%
89%84% 83%
88%
Traditional Low End High End
Customer Accessibility-2022
Chester Competitor (Baldwin)