EXHIBITS
Exhibit A
|
1997 |
1998 |
1999 |
2000 |
2001 |
|
| NET SALES(a) |
15,238,500 |
16,762,350 |
18,438,585 |
20,282,444 |
22,310,688 |
| COST OF GOODS |
7,626,140 |
8,388,754 |
9,227,629 |
10,150,392 |
11,165,432 |
| SELL GEN & ADMIN EXP |
3,426,213 |
3,768,834 |
4,145,718 |
4,560,290 |
5,016,318 |
| DEPRECIATION & AMORT |
1,726,235 |
1,898,859 |
2,088,744 |
2,297,619 |
2,527,381 |
| EBIT |
2,459,912 |
2,705,903 |
2,976,494 |
3,274,143 |
3,601,557 |
| INTEREST EXPENSE(b) |
201,935 |
232,225 |
255,448 |
280,993 |
309,092 |
| EBT |
2,257,977 |
2,473,678 |
2,721,046 |
2,993,150 |
3,292,465 |
| TAXES© |
858,031 |
939,998 |
1,033,997 |
1,137,397 |
1,251,137 |
| NET INCOME |
1,399,946 |
1,533,680 |
1,687,048 |
1,855,753 |
2,041,329 |
| PLUS DEPRECIATION & AMORT |
1,726,235 |
1,898,859 |
2,088,744 |
2,297,619 |
2,527,381 |
| CASH FLOW |
3,126,181 |
3,432,539 |
3,775,793 |
4,153,372 |
4,568,709 |
| LESS RETENTIONS(d) |
356,093 |
373,898 |
400,070 |
428,075 |
458,041 |
| PLUS TERMINAL VALUE |
35,773,223 |
||||
| NET CASH FLOW TO PURCHASER |
2,770,088 |
3,058,641 |
3,375,722 |
3,725,297 |
40,799,972 |
| (a)Since 8.5% is the average growth over the past 5 years, that was the growth rate used in 1997. All years thereafter, are based on 10% growth. | |||||
| (b)-To bring Sprint up to its target capital structure, their debt was increased by 15% in 1998, and 10% | |||||
| thereafter. The present capital structure is 27%. The target is 40%. | |||||
| ©The existing tax rate was maintained at 38%. | |||||
| (d)Cash flows generated must be retained to finance asset replacement and growth. Thereafter, | |||||
| retentions will grow at 5% in 1998, and 7% til 2001. | |||||
Exhibit B
|
(In billions) |
|||
|
1996 |
1995 |
1994 |
|
| Net cash used by investing activity |
-1,856.2 |
-3,184.2 |
-2,025.4 |
| Net cash provided (used) by financing activities |
479.1 |
422.6 |
-456.9 |
| Difference between investing and financing |
-1,377.1 |
-2,761.6 |
-2,482.3 |
| Retained Earnings |
3,211.8 |
2,763 |
2,730.9 |
| Balance after RE added in with financing |
1,834.7 |
1.4 |
248.6 |
Exhibit C
Exhibit D Exhibit E
|
VALUES |
||||||
| Times Interest Earned | Net Present Value Of Sprint |
$22,475,313,000 |
||||
| Risk free rate for industry |
14.80% |
|||||
| Risk free rate |
6.40% |
|||||
| Leveraged change in beta |
0.78 |
|||||
|
1996 |
1995 |
1994 |
Beta |
1.1 |
||
| Sprint |
10.72 |
6.68 |
5.62 |
Tax rate |
38% |
|
| ATT |
27.54 |
11.99 |
17.64 |
New beta with target debt to equity |
1.10 |
|
| MCI |
11.15 |
7.02 |
9.37 |
New cost of equity |
22.72 |
|
| Shares Outstanding |
430,100,000 |
|||||
| Sprint Takeover Share Price | ||||||
| (presently 54 ¼) |
60 |
|||||
| Value of Sprint |
25,806,000,000 |
|||||
Walking Down Life's Road With Andy 