Middle Grade Mystery, Loot How to Steal a Fortune

International jewelry heists, magical moonstones, and a terrifying prophecy come together in Jude Watson’s middle-grade mystery thriller Loot: How to Steal a Fortune.  When a famous jewel thief meets an untimely death, he leaves his son March a series of random clues to unravel. The clues lead him to the twin sister he never knew and to the discovery of a terrible curse placed upon them at birth.  Ã‚   To reverse the curse, the twins must reunite seven stolen moonstones, but time is running out.  A seven million dollar reward for the return of the jewels uncovers another thief who has a personal stake in the prize. The race to solve the clues and find the moonstones is on, and March and Jules must hurry before blue moon sets on their thirteenth birthday. Summary of the Story Twelve-year-old March, son of notorious jewelry thief Alfred McQuinn, was not expecting to lose his father so soon.  After falling from the roof of a high-rise, the dying cat burglar tells his son to find â€Å"jewels.† In shock, March flees the scene before police can catch him. Left with his father’s dying words, March puts the clues together to discover he has a twin sister named Jules. Unfortunately, just after the two unite, they are whisked off to New York to live in a corrupt group home where they meet two other lonely but smart teenagers named Darius and Izzy. At their father’s funeral, March and Jules encounter Carlotta Grimstone. Carlotta, one of Alfies jewel victims, wants her seven precious moonstones back and is offering a reward. The jewels have a â€Å"crude magic† and Carlotta needs them before the next blue moon. Realizing Alfie has left them clues to the seven places where the jewels are hidden, the twins, along with Darius and Izzy, form the â€Å"Throw Away Gang† and make plans for their first heist. However, they soon learn from a â€Å"gem advisor† that Alfie kept the twins apart because of a terrible prophecy made the night the moonstones were stolen. If the twins don’t reverse the curse before the setting of the blue moon on their thirteenth birthday, they will die together. Unexpectedly a third thief is on their trail. Oscar Ford is a former colleague of Alfie McQuinn, and he wants that reward money. Through twists and turns and staying one step ahead of each other, the thieves crack clues to find the seven stones. From Amsterdam to New York to San Francisco, the thieves plan their heists and work their cons. The stakes are high, but for Jules and March, the stakes are even higher as they work to reverse the curse and begin a new life as a family. About the Author Jude Watson Jude Watson is the alias for National Book Award winner Judy Blundell. A resident of Long Island, New York, she has had a prolific career writing Star Wars prequels for children. Currently, she is one of the contributing authors to The 39 Clues book series.  Writing under her real name, Judy Blundell received the 2008 National Book Award for her young adult novel What I Saw and How I Lied. Review and Recommendation Action fans are in for a treat. Loot is a fast-paced race of thieves trying to outwit each other for a high stakes reward. While the book is sure to thrill mystery and adventure readers, it will also satisfy readers who enjoy stories about family. Family is a key theme in Jude Watson’s adventure novel about twins March and Jules McQuinn.  Before Alfie’s death, March often wondered about his mother. Living life dangerously and globetrotting the world with his father may have been exciting, but it certainly wasn’t stable.  Upon Alfie’s death, March soon realizes he does have a family. Jules, too, yearns for family, and while she travels incognito to abandoned sites to perform dangerous trapeze acts with her Aunt Blue, she resents the father who doesn’t seem to want her. When March and Jules finally meet each other, it is with trepidation, reserve and a deep need to be part of a family. Misunderstandings and hurt feelings are pacified once March and Jules realize their father was actually protecting them by keeping them apart.  Along with new friends Darius and Izzy, the group of abandoned kids creates their own family, the Throw Away Gang. Short chapters with â€Å"inside information† on how to be a thief keep the story constantly moving. Outrageous cons to find all seven moonstones make this story an enjoyable read. Although somewhat predictable, there is one unexpected twist that just might surprise and satisfy the serious mystery reader.   Loot is a thrilling international chase across the globe to stop a curse and unite a family. With Watson’s history of writing long-term series, readers will be hoping there is another exciting jewel heist in the future for this endearing group of young thieves. Recommended for ages 10 to 14. (Scholastic, 2014. ISBN: 9780545468022)

M3 Explain How the Results from Measuring and Managing...

Measuring and managing helps a company to improve quality, retain key employees and be ahead of their competitors. A company can see how well a business is doing by the amount of customers and profits they make. They can compare how well employees work by checking each employee individually to see how much they have produced. Measuring employee development can be done by: Bench marking Using standard measurements in a service can be used to compare with other organizations in order to gain perspective on organizational performance. Performance management bring together many of the elements which go to make up the successful practice of people management, including learning and development. We’re used to thinking of ongoing performance†¦show more content†¦an employee may feel they would like to attend a particular course in the coming appraisal period, but if it does not met a business need the manager may need to persuade them to understand different trainings. Since Marriott hotel has products and service they can see how many guests have check in and out within the last months. Like this they can manage and see that customers are satisfied with their staff’s performances. They can also calculate the amount of complaints taken and who worked on that day to have their individual judgment on how they can improve customers satisfaction. Goal setting is important for providing ongoing and year end feedback. By monitoring targets management can give their employees input on their performances while motivating them to achieve more. It is important that targets are relevant to employee as well as the employer so they everyone is aware of what needs to be achieved and that way in which the targets will help to meet the business and employee needs. Staying on top of employee progress will help from any mistakes coming in the long run. This could be done by asking your employee what type of monitoring and feedback would be most helpful to the m, especially if the task is challenging or if it’s the first time there doing it. A good way to measure and manage your employee is to have performance evaluation system, managers can then see their results and the targets that can perform, achieve and makeShow MoreRelatedunit 16958 Words   |  4 Pagesachieve this, staff will have to be properly selected, trained and managed. Managers have to understand how to motivate employees and win their commitment to the organisation. By the end of this unit you must know the factors involved in human resource planning, how organisation motivate employees, how organisation gain employees co-operation and understand the importance of managing employee performance at work. Assignment 1- Human Resource Planning Assignment Issue Date: Assignment Hand in Date:Read MoreP5 Explain How Employee Performance Is Measured And Managed746 Words   |  3 Pagesï » ¿P5 – explain how employee performance is measured and managed Describe these 3 methods of measuring performance 1. Performance indicators – performance indicators outline what an employee does right for example if they receive a 10/10 positive feedback from who they serve and zero defects. 2. Goal theory – this is a method of motivation in which someone is given a goal to work towards to so their work output will increase. 3. 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DRUCKER Contents Introduction: Tomorrow’s â€Å"Hot† Issues 1 Management’s New Paradigms 2 Strategy—The New Certainties 3 The Change Leader 4 Information Challenges 5 Knowledge-Worker Productivity 6 Managing Oneself Acknowledgments About the Author Books By Peter F. Drucker Credits Front Cover Copyright About the Publisher iii Introduction: Tomorrow’s â€Å"Hot† Issues Where, readers may ask, is the discussion of COMPETITIVE STRATEGY, of LEADERSHIPRead MoreAcca F5111177 Words   |  445 PagesPAPER F5 PERFORMANCE MANAGEMENT P R A C T I C E R E V I S I O N K I T In this January 2010 new edition We discuss the best strategies for revising and taking your ACCA exams We show you how to be well prepared for your exam We give you lots of great guidance on tackling questions We show you how you can build your own exams We provide you with three mock exams including the December 2009 exam We provide the ACCA examiner s answers as well as our own to the June and December 2009 examsRead More_x000C_Introduction to Statistics and Data Analysis355457 Words   |  1422 PagesLuis Obispo Australia †¢ Brazil †¢ Canada †¢ Mexico †¢ Singapore †¢ Spain †¢ United Kingdom †¢ United States Introduction to Statistics and Data Analysis, Third Edition Roxy Peck, Chris Olsen, Jay Devore Acquisitions Editor: Carolyn Crockett Development Editor: Danielle Derbenti Assistant Editor: Beth Gershman Editorial Assistant: Ashley Summers Technology Project Manager: Colin Blake Marketing Manager: Joe Rogove Marketing Assistant: Jennifer Liang Marketing Communications Manager: Jessica PerryRead MoreQuality Improvement328284 Words   |  1314 PagesIndustrial Engineering and Statistics and the Arizona State University Foundation Professor of Engineering. He received his B.S., M.S., and Ph.D. degrees from Virginia Polytechnic Institute, all in engineering. From 1969 to 1984 he was a faculty member of the School of Industrial Systems Engineering at the Georgia Institute of Technology; from 1984 to 1988 he was at the University of Washington, where he held the John M. Fluke Distinguished Chair of Manufacturing Engineering, was Professor of Mechanical

Wan Design Free Essays

In this scenario I will be providing information associated with the creation of a WAN for ACME Manufacturing. This business has several locations spread out all over America and requires a WAN to connect their locations in America with their newly build plant in China. With the headquarters and engineering offices in Atlanta, which are right across the street from each other, the plan would make sense to connect all communication here. We will write a custom essay sample on Wan Design or any similar topic only for you Order Now There are also distribution offices in New York, Chicago, and Phoenix which will have to be connected to this network to attend the weekly company meetings and have access to information stored at headquarters. For the headquarters and engineering offices in Atlanta a LAN setup with routers and Ethernet wires will be introduced. This choice is based on higher speeds for the network as well as a significant reduction in cost. For the offices in New York, Chicago, and Phoenix a Satellite link will be added to ensure communication with the network located at the headquarters in Atlanta. A satellite link will be made available to China as well to ensure that all locations have access to the main headquarters. Having all offices linked to a central location will allow interactions to be achieved for orders, manufacturing, communication, and other correspondence. This will allow the information and communication to be delivered at a higher standard than other means. Because we will be connecting all of the locations to a central location in Atlanta we will be using a Star Topology. A Star Topology will allow every office a direct link to headquarters and will centralize the network management making it easier for an administrator to monitor. I have listed an example diagram of the Star Topology Below: With this Star Topology and the vast distances that would have to be reached to ensure communication with all locations ACME Manufacturing will have to lease T1 lines. This will ensure High Bandwidth speed and promote a more successful interaction time for fulfilling orders and maintaining communication between headquarters, distribution, and the newly constructed plant. A T1 transmission can reach speeds of 1. 544Mbps and maintain up to 24 digitally transformed voice channels. (Techterms. com, 2013) In the interest of Telecommunications ACME Manufacturing would benefit the most from a VOIP. VOIP’s have become a new method for businesses of all sizes to interact and communicate with each other. With a reduced cost in cabling and hardware needed for setting up the service it brings great benefits to a business. Often the same cables utilized to make up a network can be used to create a VOIP and communicate efficiently. With this form of telecommunication ACME Manufacturing is sure to increase production, maintain a better relationship with customers, and decrease the overall expenses with a low maintenance system. Virtual meetings will be made easier as the VOIP is utilized by all locations that are connected to the main headquarters. When addressing IP Addressing a Class C would be appropriate, supposing the network mask pertains to every subnet and using the same network IP address. (Regan, 2004) A VLAN will be advantageous to ACME Manufacturing because of the link it will provide to all six locations. Because the buildings are separated physically from each other a Virtual Network will allow the buildings to be grouped virtually which will increase the efficiency of the network. This virtual grouping will allow for better communication and increased productivity between all locations. I have assessed the hardware needs associated with this network and have come up with some suggestions which will operate the network in the most efficient way. First, A number of Mainframe Computer Systems will be installed at each location which will serve as the brain for each location. After the initial link is made with the central headquarters the Mainframe computers will be linked to routers and switches. Routers and switches will be utilized to route network signals to all areas of this large network. Telephony systems will be introduced to serve the VOIP located at each location to assist with communication needs. Wireless technologies will also be needed to assist with mobility and other devices such as printers, laptops, fax machines, etc. Lastly, a physical firewall will be enforced at each location to protect the network from internal and external intruders. The wireless technologies for ACME Manufacturing will be specific to the needs of the company. For example the teleconferencing between the six locations may require wireless webcams and headsets which will need to be ran on a wireless signal. These technologies may also need to utilize the satellite signals to better communicate across large physical distances. Wi-Fi may also be introduced within each building to increase mobility and productivity. The Wi-Fi technologies will be worth it because the benefit will outweigh the extra cost as the technology is easy to set up and maintain. The Router protocols implemented will be a OSPF which stands for (open shortest path first). Because of the large network being introduced this protocol will be the most useful. This protocol operates on Internal Gateway Protocols by routing the most direct path and using the bandwidth most optimally. This not only reduces the use of bandwidth but also offers an ease of maintenance for administrators. (Techterms. com) The last area to be assessed will be the security of the network. This is by no means the less important as the security of this size will be difficult. Physical firewalls should be setup on each mainframe at each location to control the flow of incoming and outgoing information. Antivirus and Malware software should be implemented to help seek and destroy malicious attacks. Encryption will be used in the form of users supplying unique usernames and difficult passwords in order to gain entry into the network. Also, a physical form of protection will be introduced into vital places like server rooms and admin offices in the form of physical security cameras and in some cases guards. A team should be formed at each location to ensure the security of the network and combat any unauthorized entry. No network security system is obsolete but all bases should be covered. With these recommendations I have supplied I believe that the ACME Manufacturing company will be happy with their network. It will allow communication and distribution orders from each location and all will be connected to the main headquarters. The increase in productivity and communication will surely lead to an increase in sales and success. How to cite Wan Design, Papers

Bathsheba and Oak are both very significant characters in the book Essay Example For Students

Bathsheba and Oak are both very significant characters in the book Essay Bathsheba and Oak are both very significant characters in the book. The books story constantly revolves around Bathsheba and in my opinion she is the main character in the book. This young, pretty lady ends up changing the lives of three men forever. Her charms, vanity and the way in which she entraps men with her beauty leaves one man dead and one hanged for murder. Throughout the book she is constantly undecided yet I feel that Oak always seems to play the leading male role in her life even after she marries Troy. Although she does not like Oak the moment she sees him. When the two characters first meet in the book Gabriel sees a carriage loaded with furniture on top of the hill, Bathsheba is sitting on top of it. He becomes interested in the lady sitting on top of the hill and as the carriage is about to leave he followed the vehicle to the turnpike gate some way beyond the bottom of the hill, where the object of his contemplation now halted for the payment of the toll. Oak is obviously interested in the lady but the scene unfolds as Bathsheba decides not to pay the turnpike keeper the two pence that he wants. Gabriel approaches and gives the keeper the money. Let the young woman pass  Bathsheba is neither pleased nor dismissive of Oak yet because of him she has lost her point. She thinks nothing of it apart from being a little disgruntled and carries but Gabriel talks to the gatekeeper who mentions her vanity. This casual meeting introduces the two characters to each other for the first time, little does Bathsheba know that this seemingly insignificant farmer will play such a great role in her life. A short while after the event Gabriel catches a glimpse of Bathsheba from a birds eye view, this is the moment when Gabriel decides that there is something about Bathsheba that he longs for.  Having for some time known the want of a satisfactory form to fill an increasing void within him, his position moreover affording the widest scope for his fancy, he painted her a beauty.  Oak sees Bathsheba riding through his plantation and he sees her lying back on her horse without a sidesaddle riding around and revealing herself in a way that she would not had anybody been around. She does not know he is watching but she covers herself and carries on, Oak knows that he is in love. When she rides back he returns the hat and mentions that he saw her earlier, at this moment she blushes because she realises that he had seen her. Gabriel was so in love with her that he waited for her to come past the hedge every day, he had reached a peak of existence he never could have anticipated a short ti me before. Gabriel decides to marry Bathsheba but he is deceived by Bathshebas aunt into thinking Bathsheba has many sweethearts already. Bathsheba runs after him to say that this is untrue. He assumes that she wants to marry him and says that he is doing all right in life and that she could have a piano and so on. Bathsheba is excited but she would hate to be thought mens property in that way, she likes the idea of marriage but she does not like the prospect of all the responsibility afterwards, she is not impressed by Gabriels property and she is definitely unimpressed by the thought of having a little piano. Bathsheba needs taming. .uf1adf9f4b49a62a2df6949e6caddc560 , .uf1adf9f4b49a62a2df6949e6caddc560 .postImageUrl , .uf1adf9f4b49a62a2df6949e6caddc560 .centered-text-area { min-height: 80px; position: relative; } .uf1adf9f4b49a62a2df6949e6caddc560 , .uf1adf9f4b49a62a2df6949e6caddc560:hover , .uf1adf9f4b49a62a2df6949e6caddc560:visited , .uf1adf9f4b49a62a2df6949e6caddc560:active { border:0!important; } .uf1adf9f4b49a62a2df6949e6caddc560 .clearfix:after { content: ""; display: table; clear: both; } .uf1adf9f4b49a62a2df6949e6caddc560 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .uf1adf9f4b49a62a2df6949e6caddc560:active , .uf1adf9f4b49a62a2df6949e6caddc560:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .uf1adf9f4b49a62a2df6949e6caddc560 .centered-text-area { width: 100%; position: relative ; } .uf1adf9f4b49a62a2df6949e6caddc560 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .uf1adf9f4b49a62a2df6949e6caddc560 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .uf1adf9f4b49a62a2df6949e6caddc560 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .uf1adf9f4b49a62a2df6949e6caddc560:hover .ctaButton { background-color: #34495E!important; } .uf1adf9f4b49a62a2df6949e6caddc560 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .uf1adf9f4b49a62a2df6949e6caddc560 .uf1adf9f4b49a62a2df6949e6caddc560-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .uf1adf9f4b49a62a2df6949e6caddc560:after { content: ""; display: block; clear: both; } READ: Animal Rights Analysis EssayGabriel is devastated when he hears that Bathsheba is leaving but she returns. There are many small meetings that they have but the important event is when after Gabriels disaster with the sheep he comes to her farm in need of help, he wants her to employ him as a shepherd because nobody else will.  Later on in the book after Boldwood is introduced Gabriel is shearing sheep when Boldwood comes to see Bathsheba to propose to her. When he sees what is going something ticks in his mind and he snips the sheep to divert Bathsheba and Boldwoods attention. After Oak hears that Boldwood has proposed to Bathsheba she asks him to contradict all rumours about her marriage that are occurring between the workers, he refuses. He says that he will give her his point of view about her actions. Bathsheba refuses to her it yet after thinking about it, changes her mind. Gabriel rebukes her and she resolves to serious measures.  I cannot allow any man to to criticize my private conduct! Nor will I for a minute. So youll please leave the farm at the end of the week!  No sooner has Bathsheba dismissed Oak than she needs him again. The sheep are in trouble and will die unless Oak comes to save them. Bathsheba is reluctant to let Oak return yet the lives of her sheep are at stake. She tells Joe to get Gabriel to come immediately yet Oak refuses because Bathsheba is not being polite. He knows that it is a desperate situation yet he is witty and toys with her. Eventually Gabriel saves the sheep and the incident is resolved with Bathsheba letting him stay at the farm again. This is the part of the book where Oak finds out that Bathsheba relies on him because in fact she does not know too much about running a farm, he is once again re assured that maybe he will be able to have a relationship with her. When Troy comes into play Oak yet again warns Bathsheba against the man but Bathsheba is already in love and takes no notice to Gabriels concerns. After Gabriel pursues Bathsheba whilst she is on her way to Bath he is comforted by the fact that she is going to Bath to refuse Troy nevertheless Bathsheba returns from Bath and marries Troy. Oak sees the weakness of Bathshebas relationship with Troy and realises how incompetent at running the farm Troy is. Troy ends up controlling most aspects of the farm and ignoring Bathshebas wishes even though he is uncertain of what he is doing. Bathsheba married Troy between jealousy and distraction and it is clear that she is discontent with him as a husband. With a storm brewing and the men drunk Oak covers the hayricks with Bathsheba helping him but when lightning strikes they are in the barn, together as they should be. She is upset at the aspect of further married life with Troy yet she knows that Gabriel Oak will always love her, be there for her, and she thanks him for his devotion.

Religion In Whos Afraid Of Virginia Woolf Essays -

Religion In 'Who's Afraid Of Virginia Woolf?' In Edward Albee's controversial play, Who's Afraid of Virginia Woolf?, religion plays a major, yet often overlooked theme. There are constant references to God and Jesus throughout the play; in the third act, ?The Exorcism,? George recites the Requiem for the Dead, the Catholic funeral mass. Throughout the play, these religious references and the character of Honey come to symbolize the failure of religion. Albee added these references to point out the fact that although religion is and has been ubiquitous, it still gives no answers. Most of the references to God and Jesus are swear words; ?God damn,? and ?Jesus Christ!? and the like. Even though these interjections are not the typical ?reference ' to God or Jesus, they bring a sense of knowing into the play's setting. The characters know about God and believe in Him. Martha claims to be an atheist, but that is doubtful because she especially uses ?God damn' to get her point across, and she gets very upset while George is reciting the Requiem. She knows that God is there, but won't admit it. George recites the Requiem when his and Martha's son ?dies.' The requiem was designed to comfort those people whose loved ones had passed on, so that they could let go. However, while George is reciting the requiem, Martha is in hysterics! She can not let go of her ?son' and she is not comforted until George stops reading the mass. The character of Honey is somewhat of a paradox. She is the goody-goody preacher's daughter on the surface, with dark secrets held beneath. She grew up surrounded by religion, and it did practically nothing to shape her morals. She appears to be the sweet, passive, pious woman that many preachers' daughters grow up to be, but we see more of her as the play goes on. When Nick and George are talking outside for the first time, Nick reveals that he only married Honey because he thought she was pregnant. Honey knew she wasn't pregnant, she only wanted to trap Nick into matrimony. Not a very Christian thing to do. Also, she has been taking birth control and concealing it from Nick. There are three things wrong with that. First, birth control itself is against Christian belief. Second, withholding important information from someone who should know that information is considered lying within the Christian church. Third and finally, her selfishness goes against everything she should have lea rned growing up in the home of a preacher. Albee made and still makes a point in this play. ?Although religion is supposed to be the answer, it gives none.' That point is supported by every religious reference he added in. Every reference to God and Jesus being a swear word, the requiem causing grief instead of comfort, and finally the preacher's daughter being everything but Christian. Albee definitely got his point across this time.

Evolution of Canada During 1920 essays

Evolution of Canada During 1920 essays Throughout history countries have evolved over time and Canada is no exception. In the decade of the twenties Canadian woman were given new roles and esteem within society. In addition technology in Canada improved vastly during the 1920s and prohibition opened new doors for Canadian families. The 1920s were a time of advancement for Canada and its population at large. Much technological advancement were established During the 1920's. Canadas economy soared to new heights as results of these advancements. New inventions that were once unaffordable could now be enjoyed by the typical Canadian family. One such technology, the dial telephone became the hot item to own. With the first regular dial telephone without a crank appearing in Toronto in 1924. By the end of the 1920s almost three-quarters of Canadian homes have telephones. This is a big difference considering only one quarter of Canadian homes had phone at the start of the 1920s. The telephone not only served as a mode of communication but a mode of unification throughout the Canadian nation. Before the telephones wide spread use the communication between the east and west coast was a mundane and lengthy process. Thus the telephone allowed for a more efficient economic system by increase of trade and unification. Furthermore, the twenties marked the first production and widespread use of a utomobiles within the society at large. The Model-T was the fist car to roll off the assembly line, and into the hearts of the Americans and Canadians. By 1927, the Model-T was found on the streets across north America. The coming of the automobile created more jobs, better transportation, and more significantly, cultural changes. The use of the automobile much like the telephone also began to unify the Canadian nation, making it possible to interact, without using a steam engine train. The 1920s marked many exceptional change ...

Human Resource Management, Performance Management Assignment

Human Resource Management, Performance Management - Assignment Example An efficient reward system is linked with the system of performance development, which relies on the performance related pay and also offers sufficient role in encouraging the performance of teams, groups, and individuals. Variable pay also plays an important part in boosting performance basically of star performers rather than fixed pay packages. Not many award practices may take the shape of bonuses, gain sharing, team-based motivation, ESOP’s, profit sharing, and also equity-based incentive rewards. 1 An effective management of award system may be advantageous for the performance of employees in many ways. First of all, it will instill an ownership sense amongst all the employees and may also give long-term focus with continual enhancement, lessens service operating costs, highlights teamwork, and reduces the dissatisfaction among employees and improved employee interest in company’s financial position. Only some organizations award their employees for achieving new skills which may adjoin value to the performance of employees and therefore facilitate the process of cross training, job rotation, and self managed work teams. Some organizations also recognize the additional performance by giving recognition rewards and also huge merit rewards for the employee commitment and achieving long-term advantageous outcomes.2 Performance management is a systematic process through which any organization involves its people as individuals and also as members of group, in enhancing the effectiveness of organization in achievement of the firm’s goals and mission. The performance of employee management includes consistently monitoring the performance, planning setting and work expectations, developing performance capacity, and also occasionally rating the performance in a summary fashion. It also considers rewards for good performance. In 1955, there were revisions made by the Government for performance appraisal and also for rewards regulations to bolster the sound management principles.

Potential output of Georgia(country) Essay Example | Topics and Well Written Essays - 500 words

Potential output of Georgia(country) - Essay Example Georgia are agriculture (12.5%), industry (27.9%) and services (59.6%).3 According to Georgia Economic Review (2009) the nominal Gross Domestic Product of Georgia has increased from 8,564 in 2003 to 19,070 in 2008. It means that in the last five years, the total increase in nominal GDP of the country is about 123%. The real GDP growth rate 2008 of Georgia is 2.1% which means that the output level of the country has increased. The global financial crisis 2007-2009 has lowered the GDP of many countries while the output of Georgia even during the crisis has remained positive. The value of nominal GDP shows that major increase in nominal GDP is brought by inflationary pressures and increase in the worth of goods and services; however, real GDP explicitly shows that a small increase in output of the country has been also seen. Georgia is considered as a country rich in energy resources. However, in 2007, the total oil extraction was 55-60 thousand tons which was very low as compared to the annual demand of 750 thousand tons.4 On the other hand in the same year, the annual consumption of electricity in the country was about 8.5 billion kWh while the country production was higher than consumption, thereby making Georgia a net electricity exporter.5 â€Å"It is the only country in the region (which doesn’t have its own gas resource) that was not affected by gas crises in January 2009 (Georgia Economic Overview).† Georgia has huge opportunities in hydro energy because of the construction of 500 kv power transmission line to Turkey, 78 MV Paravani HPP and 38 MW Mtkwari HPP. Surprisingly, although its hydro energy output is so huge however, only 18% of hydro potential has been used. The overall industrial production growth rate of Georgia in 2008 is -1%. The potential output of agriculture sector of the country has started to cover the wreckage caused by civil unrest. In the Georgian agriculture, winemaking is the major area however, since Russia was the major importer of

What are the effects of temperature on electricity demand in Essay

What are the effects of temperature on electricity demand in Sacramento, California in July and August 2008 in the daytime - Essay Example Moreover, positive linear relationships have appeared between the electric consumption and the selected variables of weather conditions. For proper planning of future investments in energy generation sector, policy makers require forecasts of electricity demand. The demand of electricity consumption in California has more than quadrupled since 1960. There are various factors, which are contributing to the increased energy consumption in California such as uncertain regulatory environment, swift population growth and economic growth. Apart from that, climatic change is another factor, which can also influence the electric consumption thereby, affecting the long term planning of electricity supply. Since climatic changes such as lower heating demand and higher cooling demand can directly influence the energy consumption in any economy therefore, this research study will evaluate its effects on energy consumption in Sacramento, California. This research will also assist the policy makers to analyze the extent to which the weather conditions can affect the energy consumption in Sacramento. Therefore, it will be very usef ul to meet the challenge of energy consumption demands in Sacramento. After conducting this research study, the answers to various questions will be achieved such as, what is the impact of weather conditions on electricity consumption? What are the affects of global warming on electricity consumption? The forecasts of electricity demand in an economy are made in consideration to the factors such as technological changes, income of consumers, population growth and prices. However, researchers have found that weather conditions variables should be also used to forecast electricity demand. A huge literature work has been done to study this relationship. In California, the population growth in the hotter interior regions of the state is causing growth in cooling demand, which

Reviewing The Siemens Information And Communications Network Information Technology Essay

Reviewing The Siemens Information And Communications Network Information Technology Essay Siemens Information and Communications Network are composed of several regional development centers around the world. One of those, located in Bangalore, India, was given the tasks of developing two large scale Softwares during the 1990s. The first of those, called ADMOSS (Advanced Multifunctional Operator Service System) was designed to facilitate modern call centers with some 500 features. The second one which followed after five years was called NetManager, it had a user-friendly, and graphics based user interface and some 6,000 features regarding administration and maintenance of EWSD network-nodes and networks. Both of these projects suffered huge deadlines-slippages, faulty design (at least initially), undetected-till-last-stage errors, embarrassment with customers and miscommunications between ICNs Munich headquarter and its Bangalores development center1. The following is an attempt to analyze the issues, their causes and possible avoidances for any similar projects. By the late 1980s Munich has recognized the talented human resource available in India. It was huge, both in terms of head-counts and knowledge. It was cheap, initially available at just 20% cost of a similar German software developer, which later in decade increased to 25%. It also had unmatched performance, in personal computers programming, in which ICN has deficiency in available human resource. Most ICN developers had worked on large systems and had little to no experience of personal computers programming. In contrast, Indian programmers have grown up experimenting with earlier version of desktops and laptops and by 1990s have reached level of expertise in some areas. Capitalizing on this resource, ICN decided to have the two projects done in India, in spite of huge cultural incompatibilities, language problems, physical distance and visa issues. The first project given to Bangalore was in no way any minor thing. It was made for existing and large customers of Siemens that heavily depend on it. It might be a non-optimal decision made by Munich but being risky it also promises huge benefits at end. ADMOSS had to facilitate telemarketing interface with non-Siemens equipment and handle large conference calls for example, among its other tasks. No surprise that at peak, 150 software developers were working on ADMOSS in Bangalore alone, in addition of local and German managers, testers and other supporting staff. The project was managed centrally by Munich, sending specifications for each of the subsystem to a high managerial level in Bangalore. This decision of central management was made perhaps due to initial distrust by Germans on Indians as it was their first encounter with them. In India, each subsystem was managed by a German or Indian manager who works with little co-ordination with each other. Once a subsystem is developed and tested locally is sent to Munich where it is integrated with the rest of the system. This method, though gave high power to Munich and enforced strict quality control has a design flaw, a programmer might be expert and identify flaw in the subsystem he has worked on, but cannot easily identify any integration errors. This method would have worked if Munich had a good size of its own programmers who tackle all the integration errors. The matters became more complicated due to the fact that the requirements of the software were not totally finalized at the start. While programmers are accustomed to run-time wishes made by clients given after the development has started and try their best to accommodate that, in large systems such as ADMOSS which also requires very large scale of precision (99.999% or five nines) its very hard to accommodate that once a system is already in development. While the project was being developed, a ray of emails and faxes kept coming with change requests resulting in inevitable design flaws and test failures. Later on, the developers had to work long hours to wrinkle out those design flaws to ultimately produce highly reliable software. If we try to find who is responsible for that, the blame comes on the marketing team in Munich that may have over-promised and was definitely not documenting and discussing every requirement with client. Some blame also goes to the client, who being a la rge corporation itself and had used software since a long time should know that run-time modifications often corrupt the project and requires heroic efforts by programmers to save the day. On one occasion, work on a billing application was stopped midstream after half a years work because of customers changing needs. Although this type of work interruption involved only 15-20 personnel at Bangalore each year, a programmer admitted to feeling de-motivated wondering about the intensity of miscommunication between Bangalore and Munich. This sometimes leads to the problem discussed later, high employee turnover, where programmers attempt to shift to those jobs where requirements are perceived as stable. Finally, there was problem of lack of sufficient attention given by high managers in Munich. In the words of a senior project manager, not all specifications were finished by our Munich office since we ourselves were not given enough time! Finally, when all two million lines of ADMOSS code was compiled together to create an integrated system, many problems surfaced. Major of them are: subsystems were found to be more interdependent on each other than desired, and, test criteria and tools were different in Bangalore and Munich. The first of these appears to be a shortcoming on part of developers in Munich who were responsible for integration of the subsystems and in a significantly smaller way on the subsystems developers in India. The second one, is definitely a management lapse made by Munich headquarter, the same test beds as used in Munich must be provided to Bangalore at the initial stage to ensure local error-testing and removal. That would have saved a lots of monetarily and temporal costs that the company had to finally bare. ADMOSS was finally released to the German customer at the end of 1996. As Hans Hauer, VP of Software RD put it, This was with some embarrassment because as Germans we expect delivery on time and with quality. The system turned out not to be fully stabilized and kept crashing. There were some minor problems too, like the user-interface being unprofessional, as the client commented, flashy and distracting, resembling video game interfaces, too technical style of documentation etc. When we analyze the causes of these problems a few things come up: first, the part of embarrassment due to delay is a fault of Indians but not much because at least six months efforts were lost not by any mistake of programmers but by a huge blunder made by client and sales team (discussed above). Second, the part of embarrassment due to delivery of a low quality product is fault of Munich who delivered a product not fully tested. Third, the inappropriate design of user interface is perhaps due to non-suffici ent communication about its requirements made by managers to the programmers. In absence of any stated and restricted user interface requirements, the programmers made the user interface as they liked it which of course not satisfied the customer. Fourth, Indians attempt to make documentation too technical for customer is perhaps due to language problem and cultural mismatches, which cant be blamed to any party. In spite of all of these issues, with time, the Indo-German team corrected the system faults and delivered a stable, working system to Munich. ADMOSS ended up highly popular with customers. The Bangalore site remained active with after-sales service, eventually correcting over 90% of ongoing faults. The second project given to Bangalore was called NetManager. It would be a user-friendly and graphics-based software product that would offer telecom customers a complete range of facilities for performing all operating, administration and maintenance functions on EWSD nodes and networks (e.g. integration of new telephone subscribers, billing, enable traffic studies to understand customer needs, and provide system surveillance etc among its 6,000 functions). Work at Bangalore commenced in early 1996 with an initial force of 30 programmers. The june 1998 pilot release involved some 300,000 lines of code and proved a hit at the customer test sites. Munich learned from the past project and gave Bangalore the same test-bed it was using so that developer can test the system as they develop it. By November 1999, Bangalore sent its complete NetManager Version 2 to Munich for testing. Typically Munich tested stability (or reliability) of new software installed by launching it on Friday afternoon and hoping to find no errors in the test log on Monday. NetManager Version 2, however, ran only one hour before crashing to a halt. A check of the test logs ultimately revealed a staggering 700 faults hidden at various points along some 600,000 lines of computer programming code, with 100 categorized as serious Level 1 faults. Initial trouble-shooting indicated that each fault could not simply be corrected individually, since each correction could create ripple effects across the entire system. A late November 1999 workshop in Bangalore involving managers from Munich and India tracked down the root cause of quality problems. As it turned out, the Indian group assumed, as in the case of most desktop computing applications, that the system would be shut off at night, and that it was acceptable for a desktop-based computer system to crash once a week. This assumption was further reinforced by an understanding that operation of the EWSD switch itself would not depend on NetManager. Furthermore, the Indian team underestimated system usage by an entire order of magnitude. We were ignorant! admitted an Indian programmer, we didnt think of asking what loads to test with, but Munich were also at fault for not telling us! Some of these erroneous assumptions could ultimately be traced to different work schedules. In the crucial summer months, many Germans went ahead with their several weeks-long pre-booked family vacations, often without leaving contact information, stranding the Indians. During crisis periods, Indian programmers, in contrast, typically took only personal leaves of two or three days, and worked 70-80 hours per week or even more. Balanced against this, however the ongoing high attrition rate was in Bangalore. As we analyze the issues and their causes, it is found that although the requirements were stable this time, which was a huge accomplishment on part of marketing team and upper management, it was not fully communicated to developers. This can be traced to faults of middle and lower management. As was in the user interface design of ADMOSS, since requirements were not explicitly stated the programmers made their own assumptions which (like in previous project) didnt match the requirements of the company or the customer. Another cause was often unavailability of appropriate personnel at Munich for communication because at the most crucial summer season of development they are out on long vacations. They do so often without any means of communication left. In that case, a developer would either have to wait for the person to return (which was of course unacceptable) or make his or her own assumptions to continue with the development. The solution is either to reschedule the vacations time period to some less crucial months (lets say spring) or the person keep in contact with ICN through a phone. In case of a vacation trip to very remote location where telephone is unavailable, the person should call to company as soon as he reaches a near city or village with a telephone line. This lack of professionalism on part of Germans resulted in Indians taking no annual vacations, working double hours a week than they are paid for and taking the pain of late modifications in design and code. On part of Indians, the high turnover was a very big issue. Once a developer hop to a better paying job, almost entire computer code written by him or her immediately becomes useless for sometime until some other programmer decrypt it and in some cases even rewrite it. This may have resulted in delays and design flaws when somebody try to modify an already made design in his or her own way not thought by the original designer no longer in company. In January 2000, the NetManager was finally demonstrated to the client. Lots of errors came up. They were traced down to two root causes. First, the German testers presenting the software to the client were not well-prepared. Second, the test-bed provided to Bangalore by Munich in 1996 had gone outdated by now and was not the same test-bed Munich now uses or was used in the demonstration to client. Both of these causes can be easily traced to the faults on part of Germans. The testers had no acceptable reason for unpreparedness. The high management responsible for updating Bangalore with test-bed was ignorant towards this duty. We can conclude that, having worked together for well over half a decade the cultural differences between the two countries were handled well. With time Indians understood what is expected from them and Germans spent substantial time and money training its people to decode Indian communications. A German spent 3 years in Bangalore becoming expert in South Indian English accent and understanding of local culture and hidden meanings of phrases etc. But there is a limit to what humans can accomplish, the physical distance between Munich and Bangalore remained a reality, advent of faxes, telephone calls, emails and even video calls can never substitute face-to-face communication. Two developers working together on the same computer (as in Extreme Programming2) cannot be substituted with two developers chatting on an Instant Messenger (such as hotmail or yahoo) even if through Remote Desktop Sharing they can actually view each others computer screen and run actions on it. It is also learn ed that human conflicts in most cases can only be solved with real, face-to-face communication. In absence of hyper-fast physical transportation (such as one that reduce travel time between the two cities to less than one hour) and no visa restrictions the problems faced by ICN in development of ADMOSS and NetManager are very likely to raise its ugly head time and again.

J.B.Priestley’s play, An Inspector Calls :: English Literature

AN INPSECTOR CALLS The six long years of anguish and fear had ended and the people of Britain were just recovering from the effects of World War Two. J.B Priestly a writer, who at the time was fifty one, was deeply involved with the war being a member of the infantry, and only just escaped death on a number of occasions. After his experiences throughout the horrific war, Priestly picked back up on his career which started before all of the battling and turned his attentions to writing plays. His first play after the war was known to be ‘An Inspector Calls’, which was eventually published in the same year. The story involves that of different opinions and actions, and of regrets. The rich and celebrated Birling family are spending a happy evening together celebrating the engagement of Sheila Birling to Gerald Croft – a marriage that will result in the merging of two successful local businesses. Yet, just when everything seems to be going so well, they receive a surprise visit from an Inspector Goole who is investigating the suicide of a young girl. He questions each one of the family members and future family members in turn about the suicide of Eva Smith, and as the play unravels it becomes evident that each member of the family has been intertwined with her life. J.B Priestly uses his play ‘An Inspector Calls’ as a way of getting across his socio-political views. He believed that people of different classes were being treated completely oppositely and demanded that something should be done. One of the key ways he emphasises points thorough the whole play is by the dramatic techniques he uses. In the course of An Inspector Calls the Birling family and Gerald Croft change from a state of great self-satisfaction to a state of extreme self-doubt. The play is in 'real time' - in other words, the story lasts exactly as long as the play is on the stage. So, what happens in a comparatively short time to create such a dramatic contrast? How is the drama maintained and the audience involved? Probably the main and most obvious dramatic technique that J.B Priestly uses is through the characters. The characters act as J.B Priestley’s thoughts and actions, and his emotions are unveiled throughout the play via them. As one of the most important and main characters in the play, Mr Birling is used in many ways as a dramatic device. The fact he cares only about himself and his family and not about anyone else in the world. We know this to be true, as just before the inspector arrives

How Important Was the First World War in the Growth of the Labour Party in the Period from 1918 to 1924

Although the First World War played quite a large role in the growth of the labour party there were many other factors that contributed to their rise in popularity. Such as, the split of the coalition, the representation of the peoples act, and finally Clause IV. During the war the party was led by Arthur Henderson who was the first Labour MP to get into parliament and he played a great role in the War-time coalition. After a disagreement with Lloyd George in 1917, Henderson resigned from the War Cabinet. This benefited the Labour party because Henderson was able to focus of reorganising the party.This included being more efficient, more organised, the funding of the party was split efficiently and they drafted the Labour Constitution. This helped their growth because it gave them a lot of time to plan how they was going to work about gaining more support over the other parties and to be able to be and efficient stable party. However, the split of the coalition led to the unpopularit y of other parties because the British public felt that the Liberals and Conservatives were unreliable and not strong enough to run the country.The split of this coalition resulted mainly because of U-turns, failures and tension between both the parties. One of the examples of a U-turn was the breaking of pledges that the powers of the House of Lords would be strengthened. The last straw for the coalition was the ‘Chanak Crisis' which seemed likely to end up in a war with Turkey, and by this time many stable conservatives including backbench MP's say Lloyd George as a liability and the coalition was failing in its basic purpose; preventing the rise of the Labour party.As a result of their unpopularity, they were actually helping the Labour Party because the electorate was looking for a stable government that wouldn’t go back on their policies and almost cause another war because they didn’t want that. The Representation of the Peoples act of 1918, gave the vote t o more working-class people, including women over 40 who owned property, who looked for a ‘worker's party' to represent them. This was the Labour party helping them gain more voters because before you had to be a member of the overnment register or pay to vote, money which many working class people didn’t have. So when this act was brought in by Labour the workers saw they were there to help them and they obviously voted them so they had a better chance of improving their lives. The fact that the representation of the peoples act came about, meant that the electorate was a wider range of classes and they were more likely to gain votes from the Working-classes. Clause IV indicated a sense of direction and offered the electorate a doctrine that made them obviously different from other parties.The main difference between Liberals and Labour was the ‘socialist' nature of this clause. However, because the party was made up of Trade unionists and the socialists, the vag ueness of the clause worked to unite all the members of the party which disagreed on some things. This helped them grow in the sense that it showed they were committed to what they said they was going to do. it also showed the party was stable, due to no disagreements and everyone in the party was taken into consideration, showing a strength, unlike Liberals which were split into two because of different opinions.Overall, although the War gave Labour plenty of time to reorganise itself and stabilise itself, it didn’t increase its growth or popularity because everyone's focus was on winning the war and that was why the War-time coalition was made. However the mixture of the Labour Constitution, mainly Clause IV, the Representation of the peoples act and the failure of the Post-War coalition were very large factors in the growth of the Labour party, proving their stability and their aims to help a wider range of people, especially working class.

Why Presidents Use So Many Pens to Sign Bills Into Law

Why Presidents Use So Many Pens to Sign Bills Into Law Presidents often use several pens to sign a bill into law, a tradition dates back nearly a century  and continues to this day. President Donald Trump, for example, used several bill-signing pens on his first day in office when he put his signature on his first executive order,  instructing federal agencies to uphold the Affordable Care Act while also  working to minimize the unwarranted economic and regulatory burdens on American citizens and companies. Trump used so many pens and handed them out as souvenirs on Jan. 20, 2017, the day he was sworn into office, that he joked to staff: â€Å"I think we’re going to need some more pens, by the way ... The government is getting stingy, right?† Oddly enough, before Trump,  President Barack Obama  used nearly two dozen pens to sign that same legislation into law in  2010. Thats a lot of pens. Unlike his predecessor, Trump uses gold-plated pens from  A.T. Cross Co.  based in Rhode Island. The companys suggested retail price for the pens is $115 apiece. The practice of using several pens isnt universal, however. Obamas predecessor, President George W. Bush, never used more than one pen to sign a bill into law. Tradition   The first president to use more than one pen to sign a bill into law was Franklin Delano Roosevelt, who served in the White House from March 1933 until April 1945. According to Bradley H. Pattersons To Serve the President: Continuity and Innovation in the White House Staff, the president used several pens to sign bills of high public interest during signing ceremonies in the Oval Office. Most presidents now use multiple pens to sign those bills into law. So what did the president do with all those pens? He gave them away, most of the time. Presidents gave the pens as commemorative souvenirs to members of Congress or other dignitaries who had been active in getting the legislation passed.  Each pen was presented in a special box bearing the presidential seal and the name of the president who did the signing,  Patterson writes. Valuable Souvenirs Jim Kratsas of the Gerald R. Ford Presidential Museum told National Public Radio in 2010 that presidents have been using multiple pens so they can distribute them to lawmakers and others who were instrumental in shepherding the legislation through Congress at least since President Harry Truman was in office. As Time magazine put it: The more pens a President uses, the more thank-you gifts he can offer to those who helped create that piece of history. The pens used by presidents to sign important pieces of legislation are considered valuable and have shown up for sale in some cases. One pen showed up for sale on the Internet for $500. Examples Most modern presidents use more than one pen to sign landmark legislation into law.   President Bill Clinton used four pens to sign the  Line-Item Veto. He gave the pens to former Presidents  Gerald Ford, Jimmy Carter, Ronald Reagan, and George H.W. Bush, according to an account of the signing by Time magazine.Obama used 22 pens to sign health care reform legislation into law in March of 2010. He used a different pen for each letter or half letter of his name. This is gonna take a little while, Obama said. According to the Christian Science Monitor, it took Obama 1 minute and 35 seconds to sign the bill using those 22 pens.​President Lyndon Johnson used 72 pens when he signed the landmark Civil Rights Act of 1964.

Top Five Hardwood Killing Insects

Top Five Hardwood Killing Insects There are many insects that attack hardwood trees which ultimately cause death or devalue a tree in the urban landscape and rural forest to the point where they need to be cut. Here are five of the most costly and aggressive insects have been most troublesome to foresters and landowners.  We have ranked these insects according to their potential ability to cause both commercial wood product damage and aesthetic landscape degradation. The Top Hardwood Tree Killing Insects Gypsy Moth: The exotic gypsy moth is one of the most notorious pests of hardwood trees in the Eastern United States. Since 1980, the gypsy moth larvae have defoliated close to a million or more forested acres each year. The moth was introduced into the United States in 1862.The insect lays visible buff-colored egg masses as leaves emerge in the spring. These masses hatch into hungry larvae that quickly defoliate hardwoods. Several defoliations can frequently kill trees under stress.Emerald Ash Borer: The emerald ash borer (EAB ) is an exotic, wood-boring beetle discovered in Michigan in 2002. EAB is blamed for killing millions of ash trees annually and forcing regional quarantines on exporting  firewood and tree nursery stock in several states. This ash borer could potentially decimate arboricultural ash plantings and natural ash stands in the eastern United States.The EAB larvae feed on the cambial bark. These S-shaped feeding galleries will kill limbs and can ultimately girdle th e tree.  Infested ash trees exhibited a top-down crown dieback, dense sprouting from trunks (epicormic shoots), and other signs of tree stress including the yellowing of foliage called the ash yellows. Asian Longhorn Beetles/Borers: This group of insects includes the exotic Asian longhorned beetle (ALB). The ALB was first found in Brooklyn, New York in 1996 but has now been reported in 14 states and threatening more.The adult insects lay eggs in an opening in the bark. The larvae then bore large galleries deep into the wood. These feeding galleries disrupt the vascular functioning of the tree and eventually weaken the tree to the point that the tree literally falls apart and dies.Elm Bark Beetle: The native elm bark beetle and/or the European elm bark beetle is critical for the overland spread of Dutch elm disease (DED) and is worthy of being included in this worst list. The beetle does not critically harm a tree by its boring but  by transporting a deadly tree disease.The DED fungus is transmitted to healthy trees in two ways:  1) this bark beetle  transmits spores from diseased to healthy trees and 2) root grafting can also spread the disease when elms are tightly spaced. N one of the native North American  elms are immune to DED but the American elm is especially susceptible. Tent Caterpillars: The eastern tent caterpillar  (ETC) and forest tent caterpillars (FTC) are first seen in the spring in eastern U.S. deciduous forests. The ETC makes its nest in the fork of branches. The FTC actually builds no tent but is by far the most destructive of the two.The favorite food of tent caterpillars is wild cherry but oaks, maples, and many other shade and forest trees are attacked. The FTC can strip extensive stands of trees of all leaves. The attacked trees growth is affected.

Food mart Essay Example | Topics and Well Written Essays - 500 words

Food mart - Essay Example Because the order quantity that he desired was not available at the closest store possible, Foodmart cannot be considered to have ripped Todd off by not having the correct amount of chocolate sauce on stock. Todd may not have been aware at the time, but Todd entered into a contract with Foodmart that contained several terms and conditions. This is not a special case; every customer who purchases items online need to be aware of all the fine details of the contract that they are entering into. For Foodmart’s online order contract, the customer cannot purchase items that were advertised for cheaper in print. In addition to this stipulation, the online sales contract states that orders placed online can only receive inventory that is available from the closest store in terms of location. Thus, Foodmart cannot be held accountable as they laid out all the terms and conditions in their online contract. If the customer chooses not to take notice of this, then it is solely the custome r’s responsibility and the company at hand cannot be held responsible. If the company chooses to reimburse Todd then that is their choice, but they have no legal obligation to do so. It may be to the company’s benefit to reimburse him once because he may prove to be a long-term customer. The benefits in this case may outweigh the negatives so it may be best to give Todd the benefit of the doubt this time only. If he is in a similar situation again, then Foodmart should advise him that there is nothing that they can do for him. Foodmart should try to avoid such a situation in the future by making its customers aware of the terms and conditions of any contract. This would avoid legal issues down the road and it would give assurances to a customer that everything will be done through legal means. Foodmart could make it easier for customers by writing its terms and conditions in simple and easy to understand words so that

Character Psychology of the Tale of Genji Essay

Character Psychology of the Tale of Genji - Essay Example The depiction of many relationships in this novel, particularly the relationship between Genji and Fujitsubo parallel several aspects of contemporary psychological theories. The theory of the Oedipus complex puts forward that males are inherently attracted to their mother while harboring a sense of aggression toward their fathers. This tension is palpable in many instances in the novel. A central motivation within the Heian court was for individuals to present a daughter to the Emperor or Heir Apparent in order to attain a higher degree of social status. Thus it was typical for the Emperor to engage in polygamous behavior. This process allowed his prestige to be more readily extended among people within the upper aristocracy (Tyler, 2001, xiii). In addition to the Empress, the Emperor had a number of Consorts and Intimates. A hierarchical structure was established with Empress holding the highest status with the Consorts and Intimates progressively lower in rank respectively. Genji is the protagonist in Shikibu's novel. As the Emperor's son, Genji was born to an Intimate that lost her father and had little political sway in the aristocratic circle (Tyler, 2001, xiii). ... Thus Genji serves the Imperial dominion as a senior government official (Tyler, 2001, xiii). While the novel contains many characters, including the women in Genji's life, the narrative returns to a focus on him. One of the main subjects in this novel is the nature of Genji's intimate connections and while he is involved in a number of relationships, there are recurrent themes that pervade the literature. Genji's mother died soon after childbirth and while he lacked the opportunity to know her well, he heard that Fujitsubo, his father's future Empress closely resembles her. Early in his life, Genji begins to adore her and later he has an intimate liaison with her from which their son will subsequently succeed to the throne (Tyler, 2001, xiv). This adoration for the mother figure of Fujitsubo will influence many aspects of Genji's future relationships. While he has relations with Fujitsubo, the nature of their connection is both discreet and brief. Genji is frustrated at the fact that he cannot attain or possess the embodiment of his desires as Fujitsubo is beyond his reach. Essentially, he attempts to recreate this special love in a young girl, Murasaki, who closely resembles her. Motivated by his desire for the mother figure, he personally grooms Murasaki to fill this role. When she becomes of age to marry, they are wed and she becomes the great love of his life (Tyler, 2001, xiv). Her death has a devastating effect on him. He becomes filled with hate as he cannot or will not accept the fact that he has survived her (Tyler, 2001, p. 761). His desire to live is largely diminished with the death of the mother figure. "Yearning too fondly for a twilight one autumn many years ago, I saw the end come at last in a cruel dream at dawn (Tyler, 2006,

Effects of the 2007 2009 Recession on Strategic Marketing Management Essay

Effects of the 2007 2009 Recession on Strategic Marketing Management Practices - Essay Example The impact of the economic downturn has redrawn the competitive structure of markets and created new and often unfamiliar situations for suppliers. One of the contributing factors for this â€Å"new normal† has been growing international protectionism and reduced access to finances that has circumscribed growth options in recovery (Muller, 2010, 67). In the wake of this challenging market situation, many businesses have managed to overcome market-place challenges and maximize opportunities by conducting strategic consumer and competitor analysis, and shifting their strategies accordingly. With this regard, this generally involves changing the target market and/or adapting the business’ marketing mix. However, the response that the recession elicited from marketing managers depended on their perceptive of its meaning and the impact it had on their businesses (Muller, 2010, 244). The Case of Revlon, Inc One organization that had to alter its strategic marketing management practices to overcome the marketing challenges of the 2007 – 2009 economic recession is Revlon, Inc. Revlon is an American multinational corporation that specializes in the provision of beauty products. Its line of business involves cosmetics, skincare, personal care and fragrance products. The company’s portfolio brands include: Revlon ® color cosmetics, Revlon ® beauty tools, Revlon Colorsilk ® hair color, Almay ® color cosmetics, Charlie ® fragrances, Ultima II ® skin care, Mitchum ® anti-perspirant deodorants, and Gatineau ® skin care. The US has a relatively large market for color cosmetics, accounting for more than 18% of the world’s market for color cosmetics. Revlon has a massive market share considering that it...The consumption per user growth rate of the industry dropped to 0.7% in 2008 from 1.4% in 2007, and continued to drop steadily throughout half of the following year. In addition, the average per unit price declined significantl y in the course of the recession period as consumers switched to low-priced brands due to reduced disposable income (Glamface, 2013, n.p). The marketing challenges that Revlon faced during and after the recent recession were not only caused by the reduced consumer spending, but also due to strong competition from the major players in the industry. According to Glamface (2013), Revlon is only a middle-level player in the cosmetics industry and is not able to invest as large amounts in research and development as the larger players such as L’oreal (LRLCY) and Proctor & Gamble. In addition, competition from smaller competitors than Revlon such as Avon and Estee Lauder Companies increased. Conclusion Revlon’s performance in the beauty industry has improved significantly since the initiation of its adapted strategic marketing management practices to cope with the effects of the 2007 – 2009 financial and economic crises. Revenue and Market share have increased significantly, indicating that adjustment of marketing practices are crucial for businesses to overcome the challenges of recession.

4g and 3g Network Essay Example for Free

4g and 3g Network Essay In this paper I will be discussing the different wireless networks, 3G and 4G. I will compare and contrast the 3G wireless networks to 4G networks. This essay shall also distinguish which wireless network has the fastest download speeds and service availability. I will identify the competition between the 3G and 4G networks, and which service customers prefer to use. I also will provide which phone services such as Verizon and ATT have the most network coverage throughout America. Concluding this article I would like for the reader to get a better understanding with the comparison of the 3G and 4G wireless networks. The 3G service is a high speed to information and voice services, made within the 3G wireless network. A 3G network is a high-speed wireless network, offering speeds of at least 144 kilobits per second. For comparison, a dial-up Internet connection on a computer offers about 56 kilobits per second. The 3G network is a tremendous difference offering a faster speed for internet access. In your daily use of this wireless network, you will notice the 3G network vary. Factors such as signal, location and, and network traffic all come into play (Liane, Cassavoy 2013). The 4G network is the newest mobile broadband service. Network companies such as Sprint, T-Mobile, and, Verizon have jumped on the bandwagon. See more: Unemployment problems and solutions essay   Unlike 3G, 4G has a connection capable of 100Mbps with high mobility†¦ up to 1Gbps with low mobility (Wi-Fi range) (Dachis 2010). Even though there access is different because one is an upgraded system, they both is still allow for consumers to access the internet and have clearer calling service. The architecture for both systems is used on a wide area. Nonetheless 4G has been integrated on a wireless LAN network and 3G is a wide area cell base, which notes that 3G is used for voice and information network (Moore 2010). The user’s perception of these networks will be that they will be able to access the web from these at higher speeds, especially with a 4G network. There are three different types of 4G that are used in the different wireless networks. On the graph from Adam Dachis article, he has listed these networks and their providers. Sprint uses WiMax; this speed is listed as an average downstream of 3-6 mbps, 10mbs peak and its 10x faster than 3G. Its coverage is nationwide covering major cities and markets. The monthly cost or user perception will be $60 for an unlimited 4G data and 5GB of a 3G data. The compatibility of the operating system is through all OS (via mobile) Hotspot. Verizon uses the LTE network, with a downstream of 5-12 mbps and an upstream of 2-5 mbps. Its coverage is listed in 38 markets and 60 major airports on December 5, 2010 with full nation-wide coverage by 2013. The monthly cost is set for $50 for 5GB, $80 for 10GB and $10 a GB for overages. The compatibility of the operating system is through Windows only (at the launch of MAC OS X support). GoingWimax.com has listed backward compatibility for LTE is with GSM and HSPA; and that WiMax is compatible with updates standard of Mobile WiMax and the previous standard of fixed Wimax. WiBro is an internet based system that is also used for service with cell phones. Its backward compatibility is based same database system as Wimax which is WiMax standard. HSPA+ is used by T-Mobile with a peak downstream of 21mbps peak upstream of 5.7mbps with up to 3x faster than 3G. The coverage provided is Nationwide of many major cities and markets. All of these providers have proven service, but it is just up to consumer on which service they prefer. The competition between the 4G carriers has become so fierce because consumers are looking for bargains and the best service; such as how faster is the speed of the data network, the monthly payment, the coverage of the network service, the devices that are offered by the providers and the value of service. Sprint had a head start with introduction of 4G. They have excellent coverage over the United States allowing for data nationwide. Sprint is the only one of the carriers to advertise average speeds and just peak rates (Moore 2010). Moore (2010) has found that Verizon has the best speed, T-Mobile and Sprint tied with the most affective cost margin, Sprint provided the device options to consumers and best value. Verizon has been able to cover more markets because LTE has been so popular. Verizon set the stage over ATT by expanding their markets to more consumers. Verizon is able to have more mbps than ATT as well. Verizon exceeded 5 Mbps during 82 percent of our download tests and 66 percent of our upload tests; ATT surpassed this number in only 68 percent of our download tests and 40 percent of our upload tests (Moore 2012). Head-to-head comparison of these two networks measures performance over the first quarter of 2012 and across multiple markets, throwing Verizon’s more mature LTE network together with ATT’s nascent one to see what performance each offers consumers. (Moore 2012) In conclusion 3G and 4G are both still reliable services. They allow users to successfully communicate over the internet and through their mobile devices. 4G will allow new/ old consumers to purchase more high tech devices for the convenience of modern technology and communication. This essay has shown that 4G is the newer model with more services and applications to be provided. It is now the most sort after network on the market, with its speed of 100Mbps of high mobility. The fight over the best network will continue in the future. Consumers are constantly researching for the newer, better, and fastest networks available. According to Moore 2010 Sprint has proven so far to be the best network, but surely Verizon and ATT are on the rise. They are following close behind to be the top network themselves. The competition is growing the quarters, so more than likely Sprint maybe surpassed by another device or network only time will tell. References Admin. 2009. â€Å"What Is the Difference Between WiMax and LTE? Re GoingWimax.com. http://www.goingwimax.com/what-is-the-difference-between-wimax-and-lte-4155/ Cassavoy, Liane. 2013. What is 3G Service? Received from About.com. http://cellphones.about.com/od/glossary/g/3G_definition.htm Dachis, Adam. 2010. Everything You Need To Know About 4G Mobile Broadband. Received from Lifehacker.com. http://lifehacker.com/5706644/everything-you-need-to-know-about-4g-mobile-broadband Kayne R. What is WiBro? WiseGeek. http://www.wisegeek.com/what-is-wibro.htm Moore, Bill. 2012. Solving the LTE Puzzle: Comparing LTE Performance. Received from Gidaom.com, http://gigaom.com/2012/04/14/solving-the-lte-puzzle-comparing-lte-performance/

General Dynamics and Lockheed Martin Comparison

General Dynamics and Lockheed Martin Comparison Financial Statement Analysis General Dynamics vs. Lockheed Martin Executive Summary: This analysis provides a comparison of two major companies within the Aerospace and Defense industry, General Dynamics and Lockheed Martin. General Dynamics had an ROE of 25% whereas Lockheed Martin was 49% demonstrating LMT has a higher spread and generated a higher amount of return above its cost of equity capital as compared to GD. GD generates a higher NOPAT margin over LMT (9.4% and 7.8%, respectively) allowing GD to contribute more to ROE as a result of the decreased effect interest expenses have on net income with respect to total sales revenue. LMT has a considerable advantage for generating increased asset turnover, by generating $1.37 for every dollar as compared to GDs $1.08 for every dollar spent on company assets. General Dynamics stock is extremely undervalued (estimated $77.71 compared to closing price of $57.79) whereas Lockheed Martins stock was slightly overvalued ($85.93 compared to closing price of $84.08). Equity valuation indicates that investors were overly opt imistic in LMTs earning potential and pessimistic for GDs earning potential. Despite the valuation, the destiny of this industry remains dependent on governments decisions to decrease military spending, which will have a negative impact on both companies. However, expansion of commercial airlines and partnerships with healthcare industries will have a positive effect on these companies and overall this industry will have a neutral outcome for the upcoming year. General Dynamics (NYSE: GD) General Dynamics is the sixth largest defense contractor in the world and the second largest maker of corporate jets. The company maintains four business groups including aerospace, combat systems, marine systems and information systems and technology. Net earnings for the company increased from 2006-2008 ($1.86 to $2.46), a 24% increase over 3 years. Sales for all groups increased from $24.1 to $29.3 billion from 2006-2008, a 17% increase. The company is based in Virginia and gets 67% of its revenue from the Department of Defense. The aerospace group generated $5.5 billion (19%) in sales in 2008, mostly due to Gulfstream business jet, which include long-range and ultra-long-range jets. In response to the downturn in the economy, the production of large-body and medium-size aircraft were reduced from 87 to 73 and 69 to 24, respectively, in 2008. In product development, Gulfstream introduced 2 additions, which are the ultra-large-cabin, ultra-long-range G650 and the super-mid-size G250. Production of both of these aircrafts, which enter into service in 2011 and 2012, are foreseeable income generators based on orders placed in 2008. The combat systems group generated $8.2 billion (28%) in sales in 2008, mostly driven by demand for combat vehicles, specifically Mine-Resistant, Ambush-Protected (MRAP) vehicles. The combat system group makes, repairs and supports wheeled and tracked armored vehicles and munitions. Combat system product lines include combat vehicles, guns and ammunition systems, mobile bridge systems, armor, chemical, biological and explosion detection systems. Future opportunities include delivering hundreds of tanks and armored vehicles to Saudi Arabia between 2010 and 2012. The marine systems group generated $5.6 billion (19%) in sales in 2008, extremely productive as compared to 2007. The group delivers destroyers, submarines, logistic ship and the first commercial product carrier. Upcoming contracts include doubling production to two submarines per year beginning in 2011, which is predicted to increase revenue and earnings over the next three years. The information systems and technology generated $10 billion (34%) of sales in 2008; its biggest achievement developing a battlefield communications network program and Joint Tactical Radio System (JTRS). Customers include federal civilian agencies and commercial customers, which primarily focus on electronics for land, sea and air-based weapons systems. The acquisition of two companies in the tactical communications and healthcare information technology field are indicative of the direction this group will be making in the upcoming years. Information gathered from Morningstar1, SP500 Industry reports2 and www.generaldynamics.com3 Lockheed Martin (NYSE: LMT) Lockheed Martin is the worlds largest military weapons maker, deriving 84% of its net sales from the United States government, including the Department of Defense. The company is comprised of four operating systems including aeronautics, electronic, space and information systems and global services. Net sales increased 7.3% from 2006 to 2008 ($39.6 to $42.7 billion) and earnings increased 21.8% over three years ($2.5 to $3.2 billion). The company operates in Maryland and employs 146,000 people. The aeronautics segment generated 27% of sales ($11.5 billion) in 2008. The segments primary production are the F-35 Lightning II combat aircraft which is projected to be completed in 2010. The aeronautics segment is focused on making fighter jets and military transport planes and on unmanned military aircraft. The segment also operates the Global Sustainment enterprise to ensure success throughout the life cycle of its aircraft. The electronics systems segment also generated 27% of sales in 2008 and primarily makes land, sea and air-based missiles and missile defense systems. Specifically, this segment is focused on maritime systems and sensors, missiles and fire control, and platform, training and energy. This system also manages and operates the Sandia National Laboratories for the US Department of Energy. Current projects include the Terminal Altitude Area Defense System (THAAD), the Ballistic Missile Defense system and the firehead control system for the Apache helicopter. The space systems segment generated 19% of sales ($8.2 billion) in 2008. This segment is comprised of satellites, strategic and defensive missile systems, and space transportation systems. The US government customers accounted for 96% of this segments sales in 2008. An ongoing partner is NASA; the LMT-built Phoenix Lander will continue to rove on Mars. Another venture is with Boeing, the United Launch Alliance, which provides satellite launch services to the US government. Information systems and global services segment account for 27% of sales in 2008. This segment contains mission solutions, information systems and global services. The US government customers accounted for 93% of the segments sales in 2008. Major products/programs include communication systems, mission and combat support solutions, civil agency programs (US Census), the FAA Automated Flight Service Station, the FBIs Sentinel IT program, and various NASA programs. Collaborations and partnerships with companies around the globe enable Lockheed Martin to grow its international business both with government and industry. The establishment of Lockheed Martin Australia in 2009 indicates an international interest to grow and expand. Information gathered from Morningstar1, SP500 Industry reports2 and www.lockheedmartin.com4 Industry Outlook: Aerospace Defense The aerospace and defense industry relies heavily on US government allocation and the upcoming year will likely bring budget cuts to the defense budget in 2010. However, there are predictions that the conventional military equipment is aging and once the Iraq war ends, there will be a need for repair and replacement. Due to the high levels of deficit spending and an increasing trend for social spending, it is likely there will be cuts in defense spending and the outlook for this industry will decline. On the other hand, it is estimated that there will be an increased growth of global passenger air traffic in 2010 as compared to a decline in 2009. This is based on positive air traffic growth since comparison between 2009 and 2010. Aircrafts that are less fuel-efficient in the US will also need to be upgraded and replaced with newer aircraft. The industry predictions are moderate production cuts at Boeing and Airbus, and declines in the business jet markets due to falling corporate profits. The industry outlook is therefore at a neutral rating, due to decreased military budget but increased commercial air traffic for 2010. Competition in the industry (Boeing, Northrop Grumman, Honeywell and Raytheon) will strive for contracts within the industry. Many of these defense contractors will face uncertainty from upcoming government decisions in the next year and hence the neutral outlook for this industry. Information gathered from Morningstar and SP500 Industry Reports Financial Statement Adjustments The following table contains information on the cumulative adjustment to General Dynamics and Lockheed Martins financial Statements. Adjustments General Dynamics Lockheed Martin Income Statement  · Increase Net Income by $19 million from loss from discontinued operations net of tax  · Increase Net Income by $196 million from deferred portion of income tax  · Decrease Net Income by $70 million for gain on sale of LKEI and ILS net of tax  · Decrease Net Income by $56 million for gain on land sale  · Increase Net Income by $215 million to reverse impairment charge (215 = 314(1-.316)  · Increase Net Income by $72 million to unwind deferred taxes  · Subtract $246 million from Net Income for Pension Income Balance Sheet  · Increase assets by 75% of PV of capitalized leases ($709 million)  · Decrease assets by $7 million to unwind taxes (DTA)  · Adjustments for LIFO reserve not added to Total Assets. Added in denominator of ITR and Current Asset in Current Ratio  · Added 100% of PV of capitalization of leases to Total Liabilities ($946 million)  · Subtracted 25% of PV of capitalized leases to SE ($236 million)  · Decrease SE by $7 million to unwind deferred taxes effect (-DTA; +DTL)  · Increase assets by 75% of PV of capitalized leases ($699 million)  · Decrease assets by $5,390 million to unwind deferred taxes (DTA)  · Increase liabilities by 100% of PV of capitalized leases ($932 million)  · Decrease SE by 25% of PV of operating leases ($233 million)  · Decrease SE by $5,390 million to unwind deferred tax (-DTA; +DTL) Caveats  · Termination of A-12 program in 1991 is an unlikely contingency of $690 and is currently on appeal in the Appeals Court. Cost of Equity Capital Historically, LMT common stock has proven less sensitive to the broad stock market. With a beta of .923 and using the Capital Asset Pricing Model (CAPM), LMT investors require an annual rate of return of 10.2%. Although this is lower than the expected market return of 10.8% (see appendix for calculation and assumptions), it is greater than its industry (Guided Missile Space Vehicles) expected return of 8.7%. However, although LMT may be more volatile as a stock than its competitors, it enjoyed a Return on Equity (ROE) significantly higher than the industry average. In 2008, LMT had an ROE of 49.2% while the industry followed with a 23.4% average ROE. Just as significant and telling is the comparison of LMTs ROE to its own required rate of return. This spread of 39% is an impressive sign as it demonstrates the amount of return LMT generated above its cost of equity capital. This is also impressive to investors at first glance, and will warrant a deeper interest from prospective investors. Much the same can be said for GD when comparing its required rate of return to its ROE. Although the spread was only 12.9%, it is still a good sign that GD generates such a return above its cost of equity. However, unlike LMT GD has a beta greater than 1 and is therefore more sensitive to stock market moves; and has an expected return less than its industry return by approximately 1.25%. NOPAT Margin When we analyze the potential net income in the absence of debt, NOPAT, we observe that General Dynamics (9.4%) generates a higher margin over Lockheed Martin (7.8%), which allows General Dynamics to contribute more to ROE in comparison to Lockheed Martin as a result of the decreased effect interest expenses have on net income with respect to total sales revenue. However, when comparing NOPAT performance to the rest of their industry (Ship Boat Building Repair), General Dynamics comes in slightly below the 9.9% average that was established for 2008, but does not necessarily signify any under-performance in this area since the industry data only takes into account two firms when generating Industry NOPAT margin averages. Lockheed Martin was similarly compared to Industry data, generated by two firms as well, in which NOPAT margins were recorded that were more than double of what was found for similarly classified companies (Guided Missiles Space Vehicles 3.69%). Asset Turnover This portion of the ROE evaluates the efficiency to produce revenue based on the investment in assets made by the company. When we begin to evaluate the simplified Asset TO values provided by the multiplicative decomposition of ROE, we observe a noticeable advantage by Lockheed Martin since they reportedly generate $1.37 for every $1.00 spent on assets. General Dynamics generate slightly lower values at $1.08 for every $1.00 spent on company assets. We then continued to analyze Asset TO, now based on the additive decomposition of ROE to see how other variables affect the turnover rates. When this approach is taken, average assets for both companies in 2008 needed to be adjusted, and was done so by pulling out all non-interest bearing liabilities (NIBL). This is where we noticed that NIBLs for Lockheed Martin ($20,742) were 62.8% higher than those reported by General Dynamics ($12,735). As a result, the Asset TO ratios increased significantly for both companies (LMT 2.05 and GD 4.09 ) with respect to assets dollars invested by each company. As we can observe, unexpected losses in each companys pension fund had led them to classify their losses as liabilities since they will still needed to be accounted for in the near future. The 32% drop in the fair value of the LMT pension fund ($27,259 down to $18,539) in 2008 and the 35% drop in the fair value of the GD pension fund ($7,452 down to $4,823)was felt somewhat more extensively by LMT, since the higher amount lost reflects LMTs larger workforce of 140,000 employees. GD, although enduring a similar percentage drop in fund value, only accommodates a workforce of 91,000, and therefore lost less in overall value amount. Leverage When we analyze leverage, we are analyzing each companys ability and efficiency in using interest bearing debt to generate revenue. The higher the leverage value, the better the ability of a company is at using invested funds (IBLs) to obtain desired revenues. When evaluating LMTs and GDs effect of leverage as a result of their 2008 results, we observe that the numbers generated by LMT (0.17) are over three times higher than those generated by GD (0.05) during the same time period. As we continue to drill down into the effect of leverage, we notice that ROA is also higher for LMT as a result of the large variation in NIBLs between the two companies. Although a higher leverage effect value may indicate that LMT relies more on interest bearing debt to generate more sales revenue, an analysis of interest bearing liabilities for both LMT and GD was performed based on data available at the end of 2007 and 2008. This analysis revealed that LMT had reduced their interest bearing liabilities ($4,407 down to $3,805) while GD, whom recorded a smaller leverage effect, had done the opposite and showed to have increased their interest bearing liabilities ($2,791 increased to $4,024) by the end of 2008. Selected Ratio Comparison: Accounts Receivable Days General Dynamics Industry Lockheed Martin Industry 39.51 32.50 43.62 57.12 From the results presented above, General Dynamics demonstrates that it under-performed the rest of the industry by exceeding the average account receivable days by 7 days. In contrast, Lockheed Martin out-performed the rest of its industry by having recorded an account receivable average of 43.62 days, which means LMT was collecting from customers on an average of 13.5 days ahead of the rest of the industry. Accounts Payable Days General Dynamics Industry Lockheed Martin Industry 33.88 31.50 20.09 19.66 GD is collecting from customers on average over 2 days past the industry average of 31.50 days LMT is collecting just  ½ day over the industry average of 19.66 days Inventory Days General Dynamics Industry Lockheed Martin Industry 25.97 56.62 17.35 13.55 GD is turning inventory on average over 30 days under the industry average of 56.62 days LMT is turning inventory on average over 3 days over the industry average of 13.55 days Interest Coverage General Dynamics Industry Lockheed Martin Industry 29.57 30.43 14.49 5.49 GD could cover its yearly interest expenses 29.57 times in 2008, just under its industry average of 30.43 times LMT could cover its yearly interest expenses 29.57 times in 2008, significantly over its industry average of 5.49 times Equity Valuation The equity valuation of General Dynamics for 2008 produced an estimated share price of $77.71. This price is significantly higher than the closing per-share price of $57.59 for 2008 showing the companys stock was extremely undervalued. According to analyst reports5, some concerns about growth for General Dynamics stem from shrinking credit markets, which would impair the ability to finance business jets. Additionally, it is possible that investors were concerned the aerospace and defense industry would decline with a shift from government defense spending to social spending and deficit spending. Abnormal net income was computed as predicted net income less the cost of equity capital. Predicted net income was computed using 2008 pro forma net income of $2,674 and implementing annual growth rates suggested by Goldman Sachs earnings forecasts5. The growth rates from 2009 through 2013 were -2.9%, 7.3%, 5.2%, 7.3% and 7.8% respectively. The same earnings forecasts were used to calculate the predicted dividends. The predicted dividends from 2009 to 2013 are 577, 617, 643, 671 and 700 respectively. The terminal value assumption used in computing abnormal net income was the competitive equilibrium on incremental real sales assumption. This strategy was chosen because the government is one of General Dynamics most significant customers, comprising approximately 67% of the companys revenue. This lead to the assumption that General Dynamics may not need to invest a large amount of resources in developing new customers and that most of their future growth would be lead by existing custo mers. This assumption provided a terminal value of $21,999. The cost of capital for General Dynamics was calculated using a beta of 1.119, a risk free rate of 5% and a market risk premium of 4%. This produced a cost of capital of 9.5%. The present value of abnormal net income was calculated to be $20,265, by dividing abnormal net income by a discounting factor derived using the cost of capital. The present value of abnormal net income was combined with the initial book value of $9,810 to produce an estimated predicted price of $30,075. This price was divided by the number of shares outstanding according to the 2008 annual report to arrive at an estimated share price of $77.71. The equity valuation for Lockheed Martin for 2008 produced an estimated share price of $85.93, which is slightly higher than the actual share price as of the end of 2008 of $84.08. This shows the stock was slightly overvalued. This shows investors may have been overly optimistic in their opinion of Lockheed Martins earnings potential. Abnormal net income was computed just as that of General Dynamics. Using analysts reports6, estimated (negative) growth rates of (6%), (7%), (6.6%), 11% and 8.92% were applied to the 2008 pro forma net income of $3,114. The same terminal value assumption was used for Lockheed Martin as was used for General Dynamics. The US government is a substantial customer of Lockheed Martins, which lead to the assumption that a large portion of future growth could be attributed to existing customers and few resources could be devoted to developing new customers. The terminal value assumption provided a terminal value of $41,132. The cost of equity capital was calculated using a beta of .923, a risk free rate of 4% and a market risk premium of 5%. The 8.7% cost of capital was used to find the present value of abnormal net income of $37.936. This present value was combined with an initial book value of ($2,758) to produce an estimated price of $35,178. The estimated price divided by the number of s hares outstanding per the Lockheed Martin annual report to arrive at a per-share price of $85.93. References: 1www.Morningstar.com 2www.netadvantgage.standardandpoors.com 3www.generaldynamics.com 4www.lockheedmartin.com 5Richard Safran, Noah Poponak, Goldman Sachs, January 26, 2009. Noah Poponak, Chun-Yai Wang, Sai Krishna, Goldman Sachs, January 27, 2010 6Richard Safran, Noah Poponak, Goldman Sachs, January 22, 2009. Noah Poponak, Chun-Yai Wang, Sai Krishna, Goldman Sachs, January 29, 2010 APPENDIX CAPM = Rf Rate + (Beta*Rmrkt) Given Data Risk Free rate = 3.77% (10 Year Treasury as of 2/18/10) Market Premium (Rmrkt) = 7% (given on page 26 of class notes) LMT Beta = 0.923 Industry Beta = 0.697 GD Beta = 1.119 Industry Beta = 1.298 CAPM Calculations LMT = .0377 + .923*.07 LMT = 10.23% Industry = .0377 + .697*.07 Industry = 8.65% GD = .0377 + 1.119*.07 GD = 11.60% Industry = .0377 + 1.298*.07 Industry = 12.86% Financial Statement Analysis GD LMT 2008 2008 Beginning assets 25,733 28,926 Ending assets 28,373 33,439 Beginning equity 11,768 9,805 Ending equity 10,053 2,865 Beginning interest-bearing liabilities 2,791 4,407 Ending interest-bearing liabilities 4,024 3,805 Net income (pro forma) 2,674 3,114 Sales revenue 29,300 42,731 Other revenue 0 0 Research development expense 474 1,220 Selling, general administrative expense 1,700 2,344 Income tax expense 1,126 1,485 Income tax rate 0.31 0.32 Interest expense 133 341 Beginning inventory 1,621 1,718 Ending inventory 2,029 1,902 Cost of goods sold 25,647 38,082 Beginning accounts receivable 2,874 4,925 Ending accounts receivable 3,469 5,296 Beginning accounts payable 2,318 2,163 Ending accounts payable 2,443 2,030 Shares outstanding 386 393 Closing price per share 57.59 84.08 bloomberg.com Average assets 27,053 31,183 Average equity 10,911 6,335 Average interest-bearing liabilities 3,408 4,106 Average non-interest bearing liabilities 12,735 20,742 Average accounts receivable 3,172 5,111 Average inventory 1,825 1,810 Average accounts payable 2,381 2,097 After-tax interest rate 0.03 0.06 Multiplicative Decomposition of ROE ROE 0.25 0.49 Net profit margin 0.09 0.07 Asset turnover 1.08 1.37 Leverage 2.48 4.92 Additive Decomposition of ROE ROE 0.25 0.49 Market-to-book 2.21 11.53 NOPAT Margin 0.09 0.08 Asset turnover 2.05 4.09 ROA 0.19 0.32 Spread 0.17 0.26 Leverage 0.31 0.65 Effect of leverage 0.05 0.17 Gross profit margin 0.12 0.11 RD to revenue 0.02 0.03 SGA to revenue 0.06 0.05 Accounts receivable days 39.51 43.65 Inventory days 25.97 17.35 Operating cycle 65.48 61.00 Accounts payable days 33.88 20.09 Cash-to-cash cycle 31.60 40.91 Interest coverage 29.57 14.49 Debt ratio 0.65 0.91 Appendix C: General Dynamics Lockheed Martin Financial Statement Adjustments Cumulative Financial Statement Adjustments Summary of Income Statement Adjustments Summary of Income Statement Adjustments Net Income as Reported: $ 2,459 Net Income as Reported: $ 3,217 Discontinued operations 19 Loss on sale of property, (126) Unwind tax effects 196 land, equipment Adjusted Net Income $ 2,674 Reverse of Impairment charge 215 Unwind tax effects 72 Pension Income (264) Adjusted Net Income $ 3,114 Summary of Balance Sheet Adjustments Summary of Balance Sheet Adjustments Total Assets as reported $ 28,373 Total Assets as reported $ 33,439 Constructive capitalization of 709 Constructive capitalization 699 operating leases of operating leases Unwind tax effects (DTA) (7) Unwind tax effects (DTA) (5,390) Adjusted Total Assets $ 29,075 Adjusted Total Assets $ 28,748 Total Liabilities as reported $ 18,320 Total Liabilities as reported $ 30,574 Constructive capitalization 946 Constructive capitalization 932 of operating leases of operating leases Adjusted Total Liabilities $ 19,266 Adjusted Total Liabilities $ 31,506 Total SE as reported $ 10,053 Total SE as reported $ 2,865 Constructive capitalization (236) Constructive capitalization of operating leases (233) of operating leases Unwind tax effects (5,390) Unwind tax effects (7) (DTA+DTL) (DTA+DTL) Adjusted Total SE $ (2,758) Adjusted Total SE $ 9,810 Adjusted Total Liabilities + SE $ 29,075 Adjusted Total Liabilities + SE $ 28,748 General Dynamics Pension Income Pro Forma Calculation 1 Net pension cost (benefit) $ 20 Net postretirement plan cost 56 Total cost $ 76 Net earnings $ 2,459 Percentage 3.1% 2008 2007 2 Funded status pensions $ (2,922) $ 383 Funded status other postretirement plans (640) (642) Total funded status (3,562) (259) Difference $ (3,303) 3 Rate of return on U.S. plan assets 8.1% Expected return 593 Implied asset base 7,330 = 592 / .081 Actual return percentage -32.20% = 2360 / 7330 4 Implied asset base $ 7,330 Pro forma expected rate 7.0% Given Pro forma expected return 513 Less: Original expected return (593) Difference (reduction in pension income) (80) 1 Effective tax rate 68.8% =1-.312 Adjustment (reduction) to net income $ (55) OR: [(.081-.070)*7,330] * (1-.312) = $ 55 Adjusted income $ 2,404 = 2,459 55 Lockheed Martin Pension Income Pro Forma Calculation 1 Net pension cost (benefit) $ 462 Net postretirement plan cost 46 Total cost $ 508 Net earnings $ 3,217 Percentage 15.8% 2008 2007 2 Funded status pensions $ (11,882) $ (879) Funded status other postretirement plans 1426 2017 Total funded status (10,456) 1,138 Difference $ (11,594) 3 Rate of return on U.S. plan assets 8.5% Expected return $ 2,184 Implied asset base 25,694 = 2184 / .085 Actual return percentage -28.62% = 7354 / 25694 4 Implied asset base $ 25,694 Pro forma expected rate 7.0% Given Pro forma expected return 1,799 Less: Original expected return (2,184) Difference (reduction in pension income) (385) 1 Effective tax rate 68.4% =1-.316 Adjustment (reduction) to net income $ (264) Adjusted income $ 2,953 = 3,217 264 General Dynamics Capitalization of Operating Leases Enter interest rate below: 0.039 Enter operating lease commitments below (in millions): 2009 205.0 2010 174.0 2011 131.0 2012 97.0 2013 70.0 2014 thereafter 405.0 Solution: Present value of operating lease commitments $ 945.9 Calculation of Present Value of Operating Lease Payments: 0 205.0 1.000 205.0 1 174.0 1.039 167.5 2 131.0 1.080 121.3 General Dynamics and Lockheed Martin Comparison General Dynamics and Lockheed Martin Comparison Financial Statement Analysis General Dynamics vs. Lockheed Martin Executive Summary: This analysis provides a comparison of two major companies within the Aerospace and Defense industry, General Dynamics and Lockheed Martin. General Dynamics had an ROE of 25% whereas Lockheed Martin was 49% demonstrating LMT has a higher spread and generated a higher amount of return above its cost of equity capital as compared to GD. GD generates a higher NOPAT margin over LMT (9.4% and 7.8%, respectively) allowing GD to contribute more to ROE as a result of the decreased effect interest expenses have on net income with respect to total sales revenue. LMT has a considerable advantage for generating increased asset turnover, by generating $1.37 for every dollar as compared to GDs $1.08 for every dollar spent on company assets. General Dynamics stock is extremely undervalued (estimated $77.71 compared to closing price of $57.79) whereas Lockheed Martins stock was slightly overvalued ($85.93 compared to closing price of $84.08). Equity valuation indicates that investors were overly opt imistic in LMTs earning potential and pessimistic for GDs earning potential. Despite the valuation, the destiny of this industry remains dependent on governments decisions to decrease military spending, which will have a negative impact on both companies. However, expansion of commercial airlines and partnerships with healthcare industries will have a positive effect on these companies and overall this industry will have a neutral outcome for the upcoming year. General Dynamics (NYSE: GD) General Dynamics is the sixth largest defense contractor in the world and the second largest maker of corporate jets. The company maintains four business groups including aerospace, combat systems, marine systems and information systems and technology. Net earnings for the company increased from 2006-2008 ($1.86 to $2.46), a 24% increase over 3 years. Sales for all groups increased from $24.1 to $29.3 billion from 2006-2008, a 17% increase. The company is based in Virginia and gets 67% of its revenue from the Department of Defense. The aerospace group generated $5.5 billion (19%) in sales in 2008, mostly due to Gulfstream business jet, which include long-range and ultra-long-range jets. In response to the downturn in the economy, the production of large-body and medium-size aircraft were reduced from 87 to 73 and 69 to 24, respectively, in 2008. In product development, Gulfstream introduced 2 additions, which are the ultra-large-cabin, ultra-long-range G650 and the super-mid-size G250. Production of both of these aircrafts, which enter into service in 2011 and 2012, are foreseeable income generators based on orders placed in 2008. The combat systems group generated $8.2 billion (28%) in sales in 2008, mostly driven by demand for combat vehicles, specifically Mine-Resistant, Ambush-Protected (MRAP) vehicles. The combat system group makes, repairs and supports wheeled and tracked armored vehicles and munitions. Combat system product lines include combat vehicles, guns and ammunition systems, mobile bridge systems, armor, chemical, biological and explosion detection systems. Future opportunities include delivering hundreds of tanks and armored vehicles to Saudi Arabia between 2010 and 2012. The marine systems group generated $5.6 billion (19%) in sales in 2008, extremely productive as compared to 2007. The group delivers destroyers, submarines, logistic ship and the first commercial product carrier. Upcoming contracts include doubling production to two submarines per year beginning in 2011, which is predicted to increase revenue and earnings over the next three years. The information systems and technology generated $10 billion (34%) of sales in 2008; its biggest achievement developing a battlefield communications network program and Joint Tactical Radio System (JTRS). Customers include federal civilian agencies and commercial customers, which primarily focus on electronics for land, sea and air-based weapons systems. The acquisition of two companies in the tactical communications and healthcare information technology field are indicative of the direction this group will be making in the upcoming years. Information gathered from Morningstar1, SP500 Industry reports2 and www.generaldynamics.com3 Lockheed Martin (NYSE: LMT) Lockheed Martin is the worlds largest military weapons maker, deriving 84% of its net sales from the United States government, including the Department of Defense. The company is comprised of four operating systems including aeronautics, electronic, space and information systems and global services. Net sales increased 7.3% from 2006 to 2008 ($39.6 to $42.7 billion) and earnings increased 21.8% over three years ($2.5 to $3.2 billion). The company operates in Maryland and employs 146,000 people. The aeronautics segment generated 27% of sales ($11.5 billion) in 2008. The segments primary production are the F-35 Lightning II combat aircraft which is projected to be completed in 2010. The aeronautics segment is focused on making fighter jets and military transport planes and on unmanned military aircraft. The segment also operates the Global Sustainment enterprise to ensure success throughout the life cycle of its aircraft. The electronics systems segment also generated 27% of sales in 2008 and primarily makes land, sea and air-based missiles and missile defense systems. Specifically, this segment is focused on maritime systems and sensors, missiles and fire control, and platform, training and energy. This system also manages and operates the Sandia National Laboratories for the US Department of Energy. Current projects include the Terminal Altitude Area Defense System (THAAD), the Ballistic Missile Defense system and the firehead control system for the Apache helicopter. The space systems segment generated 19% of sales ($8.2 billion) in 2008. This segment is comprised of satellites, strategic and defensive missile systems, and space transportation systems. The US government customers accounted for 96% of this segments sales in 2008. An ongoing partner is NASA; the LMT-built Phoenix Lander will continue to rove on Mars. Another venture is with Boeing, the United Launch Alliance, which provides satellite launch services to the US government. Information systems and global services segment account for 27% of sales in 2008. This segment contains mission solutions, information systems and global services. The US government customers accounted for 93% of the segments sales in 2008. Major products/programs include communication systems, mission and combat support solutions, civil agency programs (US Census), the FAA Automated Flight Service Station, the FBIs Sentinel IT program, and various NASA programs. Collaborations and partnerships with companies around the globe enable Lockheed Martin to grow its international business both with government and industry. The establishment of Lockheed Martin Australia in 2009 indicates an international interest to grow and expand. Information gathered from Morningstar1, SP500 Industry reports2 and www.lockheedmartin.com4 Industry Outlook: Aerospace Defense The aerospace and defense industry relies heavily on US government allocation and the upcoming year will likely bring budget cuts to the defense budget in 2010. However, there are predictions that the conventional military equipment is aging and once the Iraq war ends, there will be a need for repair and replacement. Due to the high levels of deficit spending and an increasing trend for social spending, it is likely there will be cuts in defense spending and the outlook for this industry will decline. On the other hand, it is estimated that there will be an increased growth of global passenger air traffic in 2010 as compared to a decline in 2009. This is based on positive air traffic growth since comparison between 2009 and 2010. Aircrafts that are less fuel-efficient in the US will also need to be upgraded and replaced with newer aircraft. The industry predictions are moderate production cuts at Boeing and Airbus, and declines in the business jet markets due to falling corporate profits. The industry outlook is therefore at a neutral rating, due to decreased military budget but increased commercial air traffic for 2010. Competition in the industry (Boeing, Northrop Grumman, Honeywell and Raytheon) will strive for contracts within the industry. Many of these defense contractors will face uncertainty from upcoming government decisions in the next year and hence the neutral outlook for this industry. Information gathered from Morningstar and SP500 Industry Reports Financial Statement Adjustments The following table contains information on the cumulative adjustment to General Dynamics and Lockheed Martins financial Statements. Adjustments General Dynamics Lockheed Martin Income Statement  · Increase Net Income by $19 million from loss from discontinued operations net of tax  · Increase Net Income by $196 million from deferred portion of income tax  · Decrease Net Income by $70 million for gain on sale of LKEI and ILS net of tax  · Decrease Net Income by $56 million for gain on land sale  · Increase Net Income by $215 million to reverse impairment charge (215 = 314(1-.316)  · Increase Net Income by $72 million to unwind deferred taxes  · Subtract $246 million from Net Income for Pension Income Balance Sheet  · Increase assets by 75% of PV of capitalized leases ($709 million)  · Decrease assets by $7 million to unwind taxes (DTA)  · Adjustments for LIFO reserve not added to Total Assets. Added in denominator of ITR and Current Asset in Current Ratio  · Added 100% of PV of capitalization of leases to Total Liabilities ($946 million)  · Subtracted 25% of PV of capitalized leases to SE ($236 million)  · Decrease SE by $7 million to unwind deferred taxes effect (-DTA; +DTL)  · Increase assets by 75% of PV of capitalized leases ($699 million)  · Decrease assets by $5,390 million to unwind deferred taxes (DTA)  · Increase liabilities by 100% of PV of capitalized leases ($932 million)  · Decrease SE by 25% of PV of operating leases ($233 million)  · Decrease SE by $5,390 million to unwind deferred tax (-DTA; +DTL) Caveats  · Termination of A-12 program in 1991 is an unlikely contingency of $690 and is currently on appeal in the Appeals Court. Cost of Equity Capital Historically, LMT common stock has proven less sensitive to the broad stock market. With a beta of .923 and using the Capital Asset Pricing Model (CAPM), LMT investors require an annual rate of return of 10.2%. Although this is lower than the expected market return of 10.8% (see appendix for calculation and assumptions), it is greater than its industry (Guided Missile Space Vehicles) expected return of 8.7%. However, although LMT may be more volatile as a stock than its competitors, it enjoyed a Return on Equity (ROE) significantly higher than the industry average. In 2008, LMT had an ROE of 49.2% while the industry followed with a 23.4% average ROE. Just as significant and telling is the comparison of LMTs ROE to its own required rate of return. This spread of 39% is an impressive sign as it demonstrates the amount of return LMT generated above its cost of equity capital. This is also impressive to investors at first glance, and will warrant a deeper interest from prospective investors. Much the same can be said for GD when comparing its required rate of return to its ROE. Although the spread was only 12.9%, it is still a good sign that GD generates such a return above its cost of equity. However, unlike LMT GD has a beta greater than 1 and is therefore more sensitive to stock market moves; and has an expected return less than its industry return by approximately 1.25%. NOPAT Margin When we analyze the potential net income in the absence of debt, NOPAT, we observe that General Dynamics (9.4%) generates a higher margin over Lockheed Martin (7.8%), which allows General Dynamics to contribute more to ROE in comparison to Lockheed Martin as a result of the decreased effect interest expenses have on net income with respect to total sales revenue. However, when comparing NOPAT performance to the rest of their industry (Ship Boat Building Repair), General Dynamics comes in slightly below the 9.9% average that was established for 2008, but does not necessarily signify any under-performance in this area since the industry data only takes into account two firms when generating Industry NOPAT margin averages. Lockheed Martin was similarly compared to Industry data, generated by two firms as well, in which NOPAT margins were recorded that were more than double of what was found for similarly classified companies (Guided Missiles Space Vehicles 3.69%). Asset Turnover This portion of the ROE evaluates the efficiency to produce revenue based on the investment in assets made by the company. When we begin to evaluate the simplified Asset TO values provided by the multiplicative decomposition of ROE, we observe a noticeable advantage by Lockheed Martin since they reportedly generate $1.37 for every $1.00 spent on assets. General Dynamics generate slightly lower values at $1.08 for every $1.00 spent on company assets. We then continued to analyze Asset TO, now based on the additive decomposition of ROE to see how other variables affect the turnover rates. When this approach is taken, average assets for both companies in 2008 needed to be adjusted, and was done so by pulling out all non-interest bearing liabilities (NIBL). This is where we noticed that NIBLs for Lockheed Martin ($20,742) were 62.8% higher than those reported by General Dynamics ($12,735). As a result, the Asset TO ratios increased significantly for both companies (LMT 2.05 and GD 4.09 ) with respect to assets dollars invested by each company. As we can observe, unexpected losses in each companys pension fund had led them to classify their losses as liabilities since they will still needed to be accounted for in the near future. The 32% drop in the fair value of the LMT pension fund ($27,259 down to $18,539) in 2008 and the 35% drop in the fair value of the GD pension fund ($7,452 down to $4,823)was felt somewhat more extensively by LMT, since the higher amount lost reflects LMTs larger workforce of 140,000 employees. GD, although enduring a similar percentage drop in fund value, only accommodates a workforce of 91,000, and therefore lost less in overall value amount. Leverage When we analyze leverage, we are analyzing each companys ability and efficiency in using interest bearing debt to generate revenue. The higher the leverage value, the better the ability of a company is at using invested funds (IBLs) to obtain desired revenues. When evaluating LMTs and GDs effect of leverage as a result of their 2008 results, we observe that the numbers generated by LMT (0.17) are over three times higher than those generated by GD (0.05) during the same time period. As we continue to drill down into the effect of leverage, we notice that ROA is also higher for LMT as a result of the large variation in NIBLs between the two companies. Although a higher leverage effect value may indicate that LMT relies more on interest bearing debt to generate more sales revenue, an analysis of interest bearing liabilities for both LMT and GD was performed based on data available at the end of 2007 and 2008. This analysis revealed that LMT had reduced their interest bearing liabilities ($4,407 down to $3,805) while GD, whom recorded a smaller leverage effect, had done the opposite and showed to have increased their interest bearing liabilities ($2,791 increased to $4,024) by the end of 2008. Selected Ratio Comparison: Accounts Receivable Days General Dynamics Industry Lockheed Martin Industry 39.51 32.50 43.62 57.12 From the results presented above, General Dynamics demonstrates that it under-performed the rest of the industry by exceeding the average account receivable days by 7 days. In contrast, Lockheed Martin out-performed the rest of its industry by having recorded an account receivable average of 43.62 days, which means LMT was collecting from customers on an average of 13.5 days ahead of the rest of the industry. Accounts Payable Days General Dynamics Industry Lockheed Martin Industry 33.88 31.50 20.09 19.66 GD is collecting from customers on average over 2 days past the industry average of 31.50 days LMT is collecting just  ½ day over the industry average of 19.66 days Inventory Days General Dynamics Industry Lockheed Martin Industry 25.97 56.62 17.35 13.55 GD is turning inventory on average over 30 days under the industry average of 56.62 days LMT is turning inventory on average over 3 days over the industry average of 13.55 days Interest Coverage General Dynamics Industry Lockheed Martin Industry 29.57 30.43 14.49 5.49 GD could cover its yearly interest expenses 29.57 times in 2008, just under its industry average of 30.43 times LMT could cover its yearly interest expenses 29.57 times in 2008, significantly over its industry average of 5.49 times Equity Valuation The equity valuation of General Dynamics for 2008 produced an estimated share price of $77.71. This price is significantly higher than the closing per-share price of $57.59 for 2008 showing the companys stock was extremely undervalued. According to analyst reports5, some concerns about growth for General Dynamics stem from shrinking credit markets, which would impair the ability to finance business jets. Additionally, it is possible that investors were concerned the aerospace and defense industry would decline with a shift from government defense spending to social spending and deficit spending. Abnormal net income was computed as predicted net income less the cost of equity capital. Predicted net income was computed using 2008 pro forma net income of $2,674 and implementing annual growth rates suggested by Goldman Sachs earnings forecasts5. The growth rates from 2009 through 2013 were -2.9%, 7.3%, 5.2%, 7.3% and 7.8% respectively. The same earnings forecasts were used to calculate the predicted dividends. The predicted dividends from 2009 to 2013 are 577, 617, 643, 671 and 700 respectively. The terminal value assumption used in computing abnormal net income was the competitive equilibrium on incremental real sales assumption. This strategy was chosen because the government is one of General Dynamics most significant customers, comprising approximately 67% of the companys revenue. This lead to the assumption that General Dynamics may not need to invest a large amount of resources in developing new customers and that most of their future growth would be lead by existing custo mers. This assumption provided a terminal value of $21,999. The cost of capital for General Dynamics was calculated using a beta of 1.119, a risk free rate of 5% and a market risk premium of 4%. This produced a cost of capital of 9.5%. The present value of abnormal net income was calculated to be $20,265, by dividing abnormal net income by a discounting factor derived using the cost of capital. The present value of abnormal net income was combined with the initial book value of $9,810 to produce an estimated predicted price of $30,075. This price was divided by the number of shares outstanding according to the 2008 annual report to arrive at an estimated share price of $77.71. The equity valuation for Lockheed Martin for 2008 produced an estimated share price of $85.93, which is slightly higher than the actual share price as of the end of 2008 of $84.08. This shows the stock was slightly overvalued. This shows investors may have been overly optimistic in their opinion of Lockheed Martins earnings potential. Abnormal net income was computed just as that of General Dynamics. Using analysts reports6, estimated (negative) growth rates of (6%), (7%), (6.6%), 11% and 8.92% were applied to the 2008 pro forma net income of $3,114. The same terminal value assumption was used for Lockheed Martin as was used for General Dynamics. The US government is a substantial customer of Lockheed Martins, which lead to the assumption that a large portion of future growth could be attributed to existing customers and few resources could be devoted to developing new customers. The terminal value assumption provided a terminal value of $41,132. The cost of equity capital was calculated using a beta of .923, a risk free rate of 4% and a market risk premium of 5%. The 8.7% cost of capital was used to find the present value of abnormal net income of $37.936. This present value was combined with an initial book value of ($2,758) to produce an estimated price of $35,178. The estimated price divided by the number of s hares outstanding per the Lockheed Martin annual report to arrive at a per-share price of $85.93. References: 1www.Morningstar.com 2www.netadvantgage.standardandpoors.com 3www.generaldynamics.com 4www.lockheedmartin.com 5Richard Safran, Noah Poponak, Goldman Sachs, January 26, 2009. Noah Poponak, Chun-Yai Wang, Sai Krishna, Goldman Sachs, January 27, 2010 6Richard Safran, Noah Poponak, Goldman Sachs, January 22, 2009. Noah Poponak, Chun-Yai Wang, Sai Krishna, Goldman Sachs, January 29, 2010 APPENDIX CAPM = Rf Rate + (Beta*Rmrkt) Given Data Risk Free rate = 3.77% (10 Year Treasury as of 2/18/10) Market Premium (Rmrkt) = 7% (given on page 26 of class notes) LMT Beta = 0.923 Industry Beta = 0.697 GD Beta = 1.119 Industry Beta = 1.298 CAPM Calculations LMT = .0377 + .923*.07 LMT = 10.23% Industry = .0377 + .697*.07 Industry = 8.65% GD = .0377 + 1.119*.07 GD = 11.60% Industry = .0377 + 1.298*.07 Industry = 12.86% Financial Statement Analysis GD LMT 2008 2008 Beginning assets 25,733 28,926 Ending assets 28,373 33,439 Beginning equity 11,768 9,805 Ending equity 10,053 2,865 Beginning interest-bearing liabilities 2,791 4,407 Ending interest-bearing liabilities 4,024 3,805 Net income (pro forma) 2,674 3,114 Sales revenue 29,300 42,731 Other revenue 0 0 Research development expense 474 1,220 Selling, general administrative expense 1,700 2,344 Income tax expense 1,126 1,485 Income tax rate 0.31 0.32 Interest expense 133 341 Beginning inventory 1,621 1,718 Ending inventory 2,029 1,902 Cost of goods sold 25,647 38,082 Beginning accounts receivable 2,874 4,925 Ending accounts receivable 3,469 5,296 Beginning accounts payable 2,318 2,163 Ending accounts payable 2,443 2,030 Shares outstanding 386 393 Closing price per share 57.59 84.08 bloomberg.com Average assets 27,053 31,183 Average equity 10,911 6,335 Average interest-bearing liabilities 3,408 4,106 Average non-interest bearing liabilities 12,735 20,742 Average accounts receivable 3,172 5,111 Average inventory 1,825 1,810 Average accounts payable 2,381 2,097 After-tax interest rate 0.03 0.06 Multiplicative Decomposition of ROE ROE 0.25 0.49 Net profit margin 0.09 0.07 Asset turnover 1.08 1.37 Leverage 2.48 4.92 Additive Decomposition of ROE ROE 0.25 0.49 Market-to-book 2.21 11.53 NOPAT Margin 0.09 0.08 Asset turnover 2.05 4.09 ROA 0.19 0.32 Spread 0.17 0.26 Leverage 0.31 0.65 Effect of leverage 0.05 0.17 Gross profit margin 0.12 0.11 RD to revenue 0.02 0.03 SGA to revenue 0.06 0.05 Accounts receivable days 39.51 43.65 Inventory days 25.97 17.35 Operating cycle 65.48 61.00 Accounts payable days 33.88 20.09 Cash-to-cash cycle 31.60 40.91 Interest coverage 29.57 14.49 Debt ratio 0.65 0.91 Appendix C: General Dynamics Lockheed Martin Financial Statement Adjustments Cumulative Financial Statement Adjustments Summary of Income Statement Adjustments Summary of Income Statement Adjustments Net Income as Reported: $ 2,459 Net Income as Reported: $ 3,217 Discontinued operations 19 Loss on sale of property, (126) Unwind tax effects 196 land, equipment Adjusted Net Income $ 2,674 Reverse of Impairment charge 215 Unwind tax effects 72 Pension Income (264) Adjusted Net Income $ 3,114 Summary of Balance Sheet Adjustments Summary of Balance Sheet Adjustments Total Assets as reported $ 28,373 Total Assets as reported $ 33,439 Constructive capitalization of 709 Constructive capitalization 699 operating leases of operating leases Unwind tax effects (DTA) (7) Unwind tax effects (DTA) (5,390) Adjusted Total Assets $ 29,075 Adjusted Total Assets $ 28,748 Total Liabilities as reported $ 18,320 Total Liabilities as reported $ 30,574 Constructive capitalization 946 Constructive capitalization 932 of operating leases of operating leases Adjusted Total Liabilities $ 19,266 Adjusted Total Liabilities $ 31,506 Total SE as reported $ 10,053 Total SE as reported $ 2,865 Constructive capitalization (236) Constructive capitalization of operating leases (233) of operating leases Unwind tax effects (5,390) Unwind tax effects (7) (DTA+DTL) (DTA+DTL) Adjusted Total SE $ (2,758) Adjusted Total SE $ 9,810 Adjusted Total Liabilities + SE $ 29,075 Adjusted Total Liabilities + SE $ 28,748 General Dynamics Pension Income Pro Forma Calculation 1 Net pension cost (benefit) $ 20 Net postretirement plan cost 56 Total cost $ 76 Net earnings $ 2,459 Percentage 3.1% 2008 2007 2 Funded status pensions $ (2,922) $ 383 Funded status other postretirement plans (640) (642) Total funded status (3,562) (259) Difference $ (3,303) 3 Rate of return on U.S. plan assets 8.1% Expected return 593 Implied asset base 7,330 = 592 / .081 Actual return percentage -32.20% = 2360 / 7330 4 Implied asset base $ 7,330 Pro forma expected rate 7.0% Given Pro forma expected return 513 Less: Original expected return (593) Difference (reduction in pension income) (80) 1 Effective tax rate 68.8% =1-.312 Adjustment (reduction) to net income $ (55) OR: [(.081-.070)*7,330] * (1-.312) = $ 55 Adjusted income $ 2,404 = 2,459 55 Lockheed Martin Pension Income Pro Forma Calculation 1 Net pension cost (benefit) $ 462 Net postretirement plan cost 46 Total cost $ 508 Net earnings $ 3,217 Percentage 15.8% 2008 2007 2 Funded status pensions $ (11,882) $ (879) Funded status other postretirement plans 1426 2017 Total funded status (10,456) 1,138 Difference $ (11,594) 3 Rate of return on U.S. plan assets 8.5% Expected return $ 2,184 Implied asset base 25,694 = 2184 / .085 Actual return percentage -28.62% = 7354 / 25694 4 Implied asset base $ 25,694 Pro forma expected rate 7.0% Given Pro forma expected return 1,799 Less: Original expected return (2,184) Difference (reduction in pension income) (385) 1 Effective tax rate 68.4% =1-.316 Adjustment (reduction) to net income $ (264) Adjusted income $ 2,953 = 3,217 264 General Dynamics Capitalization of Operating Leases Enter interest rate below: 0.039 Enter operating lease commitments below (in millions): 2009 205.0 2010 174.0 2011 131.0 2012 97.0 2013 70.0 2014 thereafter 405.0 Solution: Present value of operating lease commitments $ 945.9 Calculation of Present Value of Operating Lease Payments: 0 205.0 1.000 205.0 1 174.0 1.039 167.5 2 131.0 1.080 121.3