財務(wù)管理案例詳解

1、 The case study ofSony corporationMembers of our group:童士衛(wèi) 財務(wù)治理0201 012002019106唐 虎 財務(wù)治理0201 012002019105王小夏 財務(wù)治理0201 012002019126季春蕾 財務(wù)治理0202 012002019214張亞茹 財務(wù)治理0201 012002019131任課老師: 夏新平完成時刻: 2005年1月28日一 .Background information of Sony1. Sony is founded on May 7, 1946 with the Headquarters Tokyo

2、and Japan.2. Its corporate strategies are becoming a “knowledge-emergent enterprise in the broadband network era”.Evidenced by recent improvements in network infrastructure, the broadband environment has begun to expand at a rapid pace. In preparation for the arrival of the full-scale broadband era,

3、 Sony is pursuing its vision of creating a Ubiquitous “Value” Network (UVN).3. Its development aspect expanded from the first magnetic tape recorder in1950, to the first QUALIA products in 2003, during these years with representative products in each decade: 60thfirst tape recorder and transistor 70

4、th-video cassette player and headphone stereo Walkman 80th-CD player and camcorder 90th-high-density disc and DVD player In the 21th century- EL Display and optical disc二. The main operations of the corporation are: 三. The main structure of its sales income1. First is the Electronics:The Electronics

5、 segment consists of the following categories: Audio, Video, Televisions, Information and Communications, Semiconductors, Components and Other.The graph shows the information about this: The income is decreasing 2. Second is the Game:Game console and software business is conducted by Sony Computer E

6、ntertainment Inc.We can see the information from the graph: the income is also decreasing3. Third is the Music:Music business is conducted by Sony Music Entertainment Inc. (SMEI) and Sony Music Entertainment (Japan) Inc. (SMEJ).The graph is showing the basic information: The income is decreasing4. F

7、ourth is the Picture:Motion pictures, television and other businesses are conducted by Sony Pictures Entertainment Inc. (SPE).And also the basic information is from the Graph: The income is increasing5. Fifth is the financial service:The Financial Services segment includes Sony Life Insurance Co. Lt

8、d. Sony Assurance Inc., Sony Bank Inc. and Sony Finance International. Inc.As graph of right show the operating information: The income is increasing6. Sixth is other operating:The Other segment includes an Internet-related business, So-net, which is conducted by Sony Communication Network Corporati

9、on, an in-House information system services business, an IC card business and other businesses.With the information in the right graph: The income is increasingThe major Products of SonyAudio Home audio, portable audio, car audio, and car navigation systems Video Video cameras, digital still cameras

10、, video decks, and DVD-Video players/recorders, and Digital-broadcasting receiving systemsTelevisions CRT-based televisions, projection televisions, PDP televisions, LCD televisions, projector for computers and display for computers Information and communications PC, printer system, portable informa

11、tion PC, broadcast and professional use audio/video/monitors and other professional-use equipment Semiconductors LCD, CCD and other semiconductors Electronic components Optical pickups, batteries, audio/video/data recording media, and data recording systems 四.Sales and Operating Revenue by Geographi

12、c Information1. The main market of course is the USA 2. It is expand the Europe and other country market ,while decrease the USA and Japan market ,While seems flat in total market .3. We can conclude Sony is facing a worldwide competition.4. It is changing its business from traditional area to the n

13、ew area, especially the entertainment market.5. It also need find new market, for example the Asian market, and bring new product with technology.This is the Segment Information of its sales income200220032004ElectronicsCustomers477255045433134758400Intersegment513631397137138995Total528618149404504

14、897395GameCustomers986529936274753732Intersegment171851875726488Total1003714955031780220MusicCustomers541418512908487457Intersegment586338459872431Total600051597506559888PicturesCustomers635841802770756370Intersegment000Total635841802770756370Financial ServicesCustomers480190509398565752Intersegment

15、289322787827792Total509122537276593544OtherCustomers161730168970174680Intersegment99733137323155712Total261463306293330392Elimination-718114-665693-421418Consolidated total757825874736337496391 6. Developing trend AnalysisFactors which may affect Sonys financial performance include the following: ma

16、rket conditions, including general economic conditions, levels of consumer spending, foreign exchange fluctuations Sonys ability to continue to implement personnel reduction and other business reorganization activities Sonys ability to implement its network strategy, and implement successful sales a

17、nd distribution strategies in the light of the Internet and other technological developmentsSonys ability to devote sufficient resources to research and developmentSonys ability to prioritize capital expenditures, and the success Sonys joint ventures and alliances. Risks and uncertainties also inclu

18、de the impact of any future events with material unforeseen impacts.7.The basic financial ratios of Sony from year 2002 to 2004Financial ratios of each items of Sony corporation200420032002current ratio1.1278 1.2953 1.3044 Acid-test ratio0.9043 1.0384 1.0411 Debt to total Assets ratio0.7359 0.7249 0

19、.7076 Long term Debt to total Assets ratio0.4078 0.4340 0.3950 Interest guarantee leverage1.2850 1.5090 1.2024 Cash guarantee leverage1.3056 1.3828 1.4109 Receivable turnover6.1248 6.1867 5.1764 Inventory turnover7.5891 7.9578 7.7804 Current Assets Turnover2.0466 2.1926 2.1152 Fixed Assets Turnover5

20、.0427 5.4101 5.0003 Total Assets Turnover0.7572 0.8262 0.8623 Gross Sales profit margin0.2652 0.2800 0.2577 Sales profit margin0.0209 0.0358 0.0131 Return on total Assets0.0158 0.0296 0.0113 Return on Equity0.0606 0.1086 0.0391 Assets Increment rate1.0426 0.9622 1.0237 Return on Fixed Assets0.1055 0

21、.1937 0.0657 Return on long term Assets0.0327 0.0648 0.0253 Net Sales profit margin0.0129 0.0167 0.0022 Net profit margin on total Assets0.0097 0.0138 0.0019 Net profit margin on Equity0.0372 0.0506 0.0065 From the above analysis and the table, we can see that:The liquidity ratio and Acid-test ratio

22、 are in a year by year up-trend ,but combining receivable turnover and inventory turnover, the increase is mainly because of the increase of accounts receivable and the decrease of current liability.The company accounts receivable turnover and inventory turnover are in up-trend ,this shows that Sony

23、 do well in accounts receivable and inventory, so its debt-repay ability and profit abilities will be in advantages.Its debt ratio is decreasing year by year, so we can see that Sony will have a low financial leverage, its financial environment will be good for its operating Also, from analysis of t

24、he table, Sonys consolidated sales, operating income, income before taxes, and net income are expected to decrease compared with the fiscal year ended March 31, 2004. While we assume that the yen for the fiscal year ending March 31, 2005 will strengthen against the U.S. dollar and will weaken agains

25、t the euroSonys investments are comprised of debt and equity securities accounted for under both the cost and equity method of accounting. If it has been determined that an investment has sustained an other-than-temporary decline in its value, the investment is written down to its fair value by a ch

26、arge to earnings.五. Analysis of Sonys abilities1. The ability to meet the obligation200220032004Current ratio 1.30441.29531.1278 Quick ratio 1.04111.03840.9043Interest coverage ratio 1.20241.50901.2850Debt to total Assets ratio 0.70760.72490.7359For short-term obligations:. From the current ratio, w

27、e see that the situation is not good for Sony corporation. Because the median current ratio for the industry is 2.1, but those of Sony is less than this obviously. But if we look at the quick ratio, we will find its very good: the industry median quick ratio is 1.1, and those of Sony are very near t

28、o it. This is because Sony has not as much inventories as other corporations.Then we can see that the ability of Sony to meet short-term obligations is good.For long-term obligations. The debt ratios are lager than 50%, which indicates that Sony borrows a large amount of money. Its evidenced by the

29、increasing amount of interest payment. . Its interest coverage ratios are obviously less than the median of that for the industry which is 4.0. Then we can see that Sonys ability to meet the long-term obligations is not good.2. Assets management analysis200220032004Receivable turnover 5.17646.18676.

30、1248Inventory turnover7.78047.95787.5891Total assets turnover 0.86230.82620.7572First, the receivable turnovers are obviously less than the median of 8.1for the industry, which tells us that Sonys receivables are considerably slower in turning over than is typical for the industry.Second, the invent

31、ory turnovers are higher than the median of 3.3 for the industry, which shows Sony has a good inventory management. This is because that inventory is a small portion of assets Third, the total asset turnovers are obviously less than the median of 1.66 for the industry. So it is clear that Sony gener

32、ates less sales revenue per dollar of asset investment than does the industry.So Sonys assets management is not good enough3. Profitability analysisGross profit margin 26.52% 28.00%25.77% Return on assets(ROI) 0.97% 1.38% 0.19% Return on net profit(ROE) 3.72% 5.06% 0.65% Sonys gross profit margin is

33、 above the median of 23.8 percent for the industry, indicating that it is relatively more effective at producing and selling products above cost.But comparing to the median ROI value of 7.8% and the median ROE value of 14.04%, those of Sony are very poor. And this means that it employs more assets a

34、nd equity to generate a dollar of profit than does the typical firm in the industry. 4. Accounts receivable securitization program In the United States of America, Sony set up an accounts receivable securitization program whereby Sony can sell interests in up to $900 million of eligible trade accoun

35、ts receivable, as defined. Through this program, Sony can securitize and sell a percentage of undivided interest in that pool of receivables to several multi-seller commercial paper conduits owned and operated by banks. Sony can sell receivables in which the agreed upon original due dates are no mor

36、e than 90 days. after the invoice dates. The value assigned to undivided interests retained in securitized trade receivables is based on the relative fair values of the interest retained and sold in the securitization. Sony has assumed that the fair value of the retained interest is equivalent to it

37、s carrying value as the receivables are short-term in nature, high quality and have appropriate reserves for bad debt incidence. There was no sale of receivables for the fiscal year ended March 31, 2003. Losses from these transactions were insignificant.5. EPS attributable to common stock:Reconcilia

38、tion of the differences between basic and diluted EPS for the years ended March 31, 2002, 2003 and 2004 is as follows:As discussed in Note 2, the earnings allocated to the subsidiary tracking stock are determined based on the subsidiary tracking stockholders economic interest.The statutory retained

39、earnings of SCN (the subsidiary tracking stock entity as discussed in Note 15) available for dividends to the shareholders were 209 million as of March 31, 2002, which decreased by 374 million during the year ended March 31, 2002 after the date of issuance.The accumulated losses of SCN were 779 mill

40、ion and 1,764 million ($17 million) as of March 31, 2003and 2004, respectively.For the year ended March 31, 2002, 75,201 thousand shares of potential common stock upon the conversion of convertible bonds were excluded from the computation of diluted EPS due to their anti-dilutive effect.44,603 thous

41、and shares of potential common stock upon the conversion of 250,000 million convertible bond issued dated December 18, 2003 were excluded from the computation of the number of weighted-average shares for diluted EPSPotential common stock upon the exercise of warrants and stock acquisition rights, wh

42、ich were excluded from the computation of diluted EPS since they have an exercise price in excess of the average market value of Sonys common stock during the fiscal year, were 2,665 thousand shares, 4,141 thousand shares, and 6,796 thousand shares for the years ended March 31, 2002, 2003 and 2004,

43、respectively.Warrants and stock acquisition rights of subsidiary tracking stock for the years ended March 31, 2002, 2003 and 2004, which have a potentially dilutive effect by decreasing net income allocated to common stock, were excluded from the computation of diluted EPS since they did not have a

44、dilutive effectStock options issued by affiliated companies accounted for under the equity method for the years endedMarch 31, 2002, 2003 and 2004, which have a potentially dilutive effect by decreasing net income allocated to common stock, were excluded from the computation of diluted EPS since suc

45、h stock options did not have a dilutive effect.On October 1, 2002, Sony implemented a share exchange as a result of which Aiwa became a wholly-owned subsidiary. As a result of this share exchange, Sony issued 2,502 thousand shares. The shares were included in the computation of basic and diluted EPS

46、.6. P/E ratioLets see the three years data of P/E Ratio200220032004P/E Ratio401.919635.5299947.97535We can see that the P/E ratios are large, and if we invest on it, we will need many years to get back our money. So its not good to invest on it. 六. Do Pont analysis1. Here Id like to analysis the eff

47、ects of all kinds of items, such as Return of total assets and Equity multiplier, to ROE. Then, based on the contributions of the items, we try to find ways to improve the ROE.At the first glance of the table, you will obverse there is so great difference between the ROE of 2002 and the other two ye

48、ar. -So I decide to analysis that one for example the decrease of the ROE in year 2002 is primarily because of the decrease of other income, increase of costs and expenses and other expenses.Let us go to the “income statement” to see the details-From the income statement behind, (1)we can see that t

49、he decrease of other income is primarily because of the decrease of foreign exchange gain and decrease of marketable security and security sales.The news behind has shown that the foreign exchange rate has changed so much that the foreign exchange risk is so high ,and the economics in Japanese has f

50、allen down.It is may be one of the reasons of the decrease of foreign exchange gain 中新網(wǎng)香港1月23日消息：盡管亞洲國家對日元接著貶值表示關(guān)注，但美國財政部長奧尼爾與日本財務(wù)大臣鹽川正十郎進行會談后表態(tài)，外匯匯率應(yīng)由市場決定。有關(guān)言論被市場理解為美國容忍日元下跌，日元匯率隨即下挫，日元兌美元跌穿一百三十四水平，創(chuàng)近三年來新低。 2002年1月23日08:24 去年(2002)日本10大消費種類中有6大類物價出現(xiàn)下跌，其中教育娛樂類下跌3%，家居類下跌3.6%，工業(yè)制品下跌1.9%，尤其是耐久類工業(yè)產(chǎn)品下跌了6

51、.9%。在價格下跌顯著的商品中，筆記本電腦價格下跌了38%，臺式電腦下跌37%，錄像機下跌15%，固定電話通信費減少7.8%等。也即意味著日本正處于通貨緊縮狀態(tài)2. The picture behind shows the marketable securities and securities investments changes3. The increase of costs and expenses is primarily because that the cost of sales has increased so much.This table shows the changes

52、 of research and development expenses changes in year 2002 2003 and 2004.(1) Research and development costs:Research and development costs charged to cost of sales for the years ended March 31, 2002 was 433,214 million ($3,257 million)(2) Advertising costs:Advertising costs included in selling, gene

53、ral and administrative expenses for the years ended March 31,2002 was 401,960 million ($3,022 million),So By decreasing researcher and development cost, advertising cost and/or shipping and handling cost, try to decrease cost of sales_so as to decrease cost and expenseThe increase of other expenses

54、is primarily because foreign exchange loss.The increase in other expenses was primarily due to an increase in foreign exchange loss, net and an increase in write downs of security investments.Foreign exchange loss, net increased to 31.7 billion yen compared with the 15.7 billion yen recorded in the

55、previous year primarily due to losses on foreign exchange forward contracts entered into to hedge the foreign currency risk associated with receivables generated from sales originating from Japan. The losses on foreign exchange contracts resulted from the rapid depreciation of the yen since December

56、 2001. Interest expense decreased from 43.0 billion yen in the previous year to 36.4 billion yen due to a refinancing of long-term debt at lower interest rates and a decrease in U.S. dollar interest rates on short-term debtImpact of Foreign Exchange Fluctuations and Basic CountermeasuresDuring the f

57、iscal year ended March 31, 2002, the average value of the yen was 124.1 yen against the U.S. dollar, and 109.1 yen against the euro, which was 11.7 percent lower against the U.S. dollar compared with the average of the previous year. Operating results on a local currency basis described in “Operatin

58、g Performance” compare results of sales and operating revenue (“sales”) and operating income obtained by applying the yens monthly average exchange rate in the previous year to monthly local currency-denominated sales, cost of sales, and selling, general and administrative expenses for the fiscal ye

59、ar ended March 31, 2002, as if the value of the yen had remained the same.七.The competition ability 1. A competition have several means as follows: scale advantage, High product quantity Continuous technique innovation ,Familiar with the market situation, Dynamic needs of product, Promote technology

60、, Talent manager ,Unite employees.First -Net sales Net sales 2002 2003 20042003/20022004/20037.58,7666,916,0426,883,47897.98%99.53%Companys market share seems to be flat, looking into the whole electronic business; company is facing a strict competition .However, high net sales shows high competitio