Operating and Stockholder Information of ROBERTSON TOOL COMPANY

operatons
sales
COGS
SGA
depreciation
interest expenses
income before tax
taxes
net income
percentage of sales
COGS
SGA
operating income
Stockholder Information
EPS
DPS
book value per share
market price
P/E
shares outstanding
BALANCE SHEET OF ROBERTSON Tool company, 2002
ASSETs
cash
A/R
inventories
other
current assets
net plant & equipement
total assets
collection period
days of inventory
sales/total assets
dabt as percentage os capital
total assets/net worth

PRO-FORMA FOR ROBERSON TOOL BY Messrs, Vincent & Rudd

Actual

CoGS % of sales
S&GA % sales
growth of sales
sales
COGS
S&GA
depreciation
EBIT
tax@40%
EBIAT
Interest
Adjustment of Interest (0.8 million)
Net Plant & Equipment in beginning of the year
Capital Expenses
Depreciation
net plat at the end of the year

2002
0.69
0.22
0.059675
55.3
38.157
12.166
2.1
2.877
1.1508
1.7262
0.8
1.2462

Five Year Forecast of Monmouth Inc exluding Roberson Tool

net income (million dollar)
shares outstanding (million)
EPS
NWC of Robertson
non cash CA
CL
NWC
NWC to sales
change of NWC
other Non cash WC
sales for 2002
other Non cash WC/sales
comparable comp. Inve/sales
total
WACC
debt
equity
cost of debt
cost of debt at present of Robertson
risk premium
tax
risk free
beta
cost of equity
WACC

2002
27
4
23
0.220416
5
55.3
0.090416
0.13
0.220416
0.28
0.72
0.066667
(.8/12)
0.06
0.4
0.041
1
0.101
0.08392

Terminal Growth rate

FREE CASH FLOW OF Robertson Tool
sales
COGS
S&GA
depreciation
EBIT
tax@40%
EBIAT
add Depreciation
cash flow from operation
Less increase NWC
less capex
free cash flow (FCF)
Terminal value
PV at WACC Rate
PV of terminal value
Total PV
Debt outstanding
Value of equity
Outstanding shares
Per share of Robertson

0.02
2002
55.3
38.157
12.166
2.1
2.877
1.1508
1.7262
2.1
3.8262

61.46104
12
49.46104
0.584
84.69356

Maximum No. of Share Calculation

1 projected net income of Monmouth
2 projected net income after tax of Roberson
3 projected Monmouth net income cmbined (1+2)
4 projected Monmouth EPS without Robertson

given

given

Max no. of shares of Monmouth shares after merger

5 without diluting Monmouth EPS (3/4)
6 Monmouth shares current have (No)
given
Max no. of shares of Monmouth can be issued to
7 Robertson without diluting its EPS (5-6)
8 No.of Robertson shares outstanding
No of Monmouth shares that could be offered for
one share of Robertson without diluting Monmouth's
9 EPS (Exchange ratio)
If Monmouth Share as $24, the Exchange ratio
10 translates into price per share of Robertson stock.

24

May be exchange ratio will be between 2.15 to 2.35

t make price more than $50 as suggested by
11 Simmons

N TOOL COMPANY
1998
48.5
32.6
10.7
2
0.4
2.8
1.1
1.7

1999
49.1
33.1
11.1
2.3
0.7
1.9
0.8
1.1

2000
53.7
35.9
11.5
2.4
0.8
3.1
1.2
1.9

0.67
0.22
0.066

0.67
0.23
0.053

0.67
0.21
0.073

Million Dollar
2001
2002
54.8
55.3
37.2
37.9
11.9
12.3
2.3
2.1
0.8
0.8
2.6
2.2
1
0.9
1.6
1.3

0.68
0.22
0.062
$

0.69
0.22
0.054
$

2.91
1.6
49.4

1.88
3.25
2.74
2.23
1.6
1.6
1.6
1.6
49.68
51.33
52.47
53.1
33-34
35-48
29-41
25-33
23-32
11-1610-269-139-1210-14584000
584000
584000
584000
584000

Million Dollar
1
8
18
1
28
19
47
53dys
173 days
1.176596
0.27907
1.516129

FORECASTS

Liabilities
A/P
other
current liabilities
long term debt

2
2
4
12

net worth

31

total

47

0.066667

2003
0.68
0.21

2004
0.67
0.2

2005
0.66
0.19

58.6 62.09693 65.80253

39.848 41.60494 43.42967
12.306 12.41939 12.50248
2.3
2.5
2.7
4.146
5.5726 7.170379
1.6584 2.22904 2.868152
2.4876 3.34356 4.302228
2.0076
19
4
2.3
20.7

Million Dollar
2007
69.72926 73.89032
45.32402 48.02871
13.24856 14.03916
2.9
2.9
8.256682 8.922451
3.302673 3.568981
4.954009 5.353471

2.86356 3.822228 4.474009 4.873471

20.7
21.7
22.6
23.5
3.5
3.6
3.8
2.9
2.5
2.7
2.9
2.9
21.7
22.6
23.5
23.5

2003
2004
11
11.9
4.21
4.21
2.612827 2.826603
2003

2006 2007 to Infinity

0.65
0.65
0.19
0.19

2004

2005
12.8
4.21
3.04038
2005

2006
2007
13.8
15
4.21
4.21
3.27791 3.562945
2006

2007

12.91637 13.68715 14.50392 15.36944 16.2866

projected to reduce to comparable companies (BBB) Inve/sales to 13% + its own other CA to sales
-10.08363 0.770778 0.816774 0.865514 0.917164
(9-4)

6
0.066667
BBB
after tax K
0.04
0.066667 same to BBB firm

30yr TB
as of BBB

Million
2007
2008
69.72926
45.32402
13.24856
2.9
8.256682
3.302673
4.954009
2.9
7.854009
0.917164
2.9
4.036846
4.036846 4.117582
64.41775
10.02955 1.338672 2.030229 2.309919 2.698087
43.05458

2003
58.6
39.848
12.306
2.3
4.146
1.6584
2.4876
2.3
4.7876
-10.08363
4
10.87123
10.87123

2004
62.09693
41.60494
12.41939
2.5
5.5726
2.22904
3.34356
2.5
5.84356
0.770778
3.5
1.572782
1.572782

2005
65.80253
43.42967
12.50248
2.7
7.170379
2.868152
4.302228
2.7
7.002228
0.816774
3.6
2.585454
2.585454

2006
69.72926
45.32402
13.24856
2.9
8.256682
3.302673
4.954009
2.9
7.854009
0.865514
3.8
3.188495
3.188495

At 2% Terminal Growth Rate, Price per share= $84.69

2003
11
2.0076

2004
2005
2006
2007
11.9
12.8
13.8
15
2.86356 3.822228 4.474009 4.873471

13.0076 14.76356 16.62223 18.27401 19.87347

2.61
2.83
3.04
3.27
3.56
4.983755 5.216806 5.467838 5.588382 5.582436
4.21
4.21
4.21
4.21
4.21

0.773755 1.006806 1.257838 1.378382 1.372436

0.584

0.584

0.584

0.584

0.584

1.324923 1.723982 2.153832 2.360243 2.350061

31.79814 41.37558 51.69197 56.64584 56.40146

own other CA to sales as the Inventory for Robertson is higher