...INTRODUCTION: Euroland Foods S.A is a multinational producer of high quality ice cream, yogurt, bottled water and fruit juices. Its products are primarily sold throughout Scandinavia, Britain, Belgium, the Netherlands, Luxembourg, western Germany, and northern France. In early January 2001, the senior management committee of Euroland Foods S.A was called together to come up with the firm’s capital budget for the new year. There were 11 projects up for consideration that the committee was faced with and had totaled more than (euro) EUR316 million. Unfortunately the board of directors had set in place a spending limit of EUR120 million. Even with this restriction the investment at this rate would cause a major increase in the firm’s current asset base of EUR965 million. The firm’s main challenge was to allocate the funds among a range of projects to satisfy the following: new-product introduction, acquisition, market expansion, efficiency improvements, preventative maintenance, safety, and pollution control. BACKGROUND OF FIRM: Theo Verdin, a Belgium Farmer, as an offshoot of his dairy business, founded Euroland Foods S.A in the year 1924. Theo paid great attention to product development and marketing, and because of his close attention to detail the firm had grown steadily over the years. The company had gone public in 1979, and by 1993, was listed for trading on the London, Frankfurt, and Brussels exchanges. In the year 2000, Euroland Foods S.A had approximately...
Words: 2666 - Pages: 11
...Euroland Foods S.A. Weihan Zhang Marshall University Euroland Foods S.A. Introduction: This case discusses Euroland Foods' the eleven projects that was financial reporting. This case indicates that Euroland Foods draft the company's capital budgeting in the New Year, but the eleven projects spend EUR316million far beyond EUR120 million spending limit prescribed by the board. It will be a challenge for senior managements to allocate funds for these projects .This case will analysis the project which is more beneficial to the company. It will include new product introduction, acquisitions, market expansion, improve efficiency, preventive maintenance, safety and pollution control. Company’s Background: The Euroland Foods was established in 1924 by the Belgian farmer Theo Verdin. This was a multinational company in the production of high quality food, such as ice cream, yogurt, fruit juices and bottled water. Ice cream, the most popular product, had a loyal customer base that was causing ice cream accounted for about 60% of company's revenue. Yogurt, was introduced by Verdin in 1982, contributed about 20% of revenue, the rest of the bottled water and fruit juice were equally divided about 10%. These products have been sold to some Europe countries, such as Britain, Belgium, Luxembourg, the Netherlands, Scandinavia, northern France and western Germany. Because Verdin focused on product development and shrewd marketing, the company grow steadily over...
Words: 1952 - Pages: 8
...Submitted by: Katherine Cancan EUROLAND FOODS S.A OVERVIEW Euroland Foods S.A, headquartered in Brussels, Belgium, is a multinational producer of high-quality ice cream, yogurt, bottled water and fruit juices. In January 2011, the senior management committee of Euroland Foods was to meet to draw up the firm’s capital budget for the new year. Unfortunately, Euroland’s over leverage, debt-to-equity ratio is 125%, is a concern among the company’s bankers. They dictate that the financing must be modest and that the company avoids increasing its debt. In an attempt to decrease the debt-to-equity ratio the company established a fixed capital budget, which was set below the total cost of the projects that they were considering. A range of 11 compelling projects totaling EUR316M were lined up to present and defend against the Board Of Directors-approved capital spending limit of only EUR120M; Thus, a need for capital budget rationing and allocation. In 1999, the company has established tests or hurdles that varied according to the type of project as shown in Table 1 of the case, subject to two financial tests: payback and Internal Rate of Return (IRR). One out of the said projects, the effluent treatment program, will not be included in the analysis anymore because there is no test required for safety and environmental type of project. Moreover, Euroland Foods is bound to comply with the European Community regulation to have wastewater to be treated at source. ...
Words: 977 - Pages: 4
...investment decision? Do not forget the effect of taxes and the initial investment amount. 2. What discount rate should Worldwide Paper Company (WPC) use to analyze those cash flows? Be prepared to justify your recommended rate and the assumptions that you used to estimate it. 3. What is the net present value (NPV) and internal rate of return (IRR) for the investment? Case 24: Euroland Foods S.A. 1. Why does the company face the capital rationing? 2. Why do different types of projects have different hurdle rate (required rate of return) and maximum acceptable payback years? 3. Prepare to discuss the strengths and weaknesses of the various measures of investment attractiveness as used by Euroland Foods. Will all of the measures rank the projects identically? Why or why not? 4. Please rank the 11 proposals on the basis of purely economic considerations. Then rank them a second time based on any other considerations that you believe are important. Are the rankings identical? Why or why not? 5. Which set of projects should Wilhelmina Verdin recommend to the board of Euroland Foods for the capital budget for 2001? Role play Accompanying this assignment are the case and supplemental information on a role that you will be asked to represent. Please study the case and the role carefully, and prepare a preliminary ranking of the 11 projects together with a recommendation to the board of directors consistent with the role you have been assigned. Your recommendation...
Words: 501 - Pages: 3
...Finance 475 Euroland Foods Case Spring, 2014 1. What are the various capital-budgeting tools currently used by leading firms? Define each, and discuss the accept/reject criterion for each. Which one is “best,” and why is it best? 2. Evaluate the capital-budgeting criteria of Euroland Foods on page 326. Their “Minimum Acceptable IRR” criterion is wrong. Why? Also, why is their criteria not a complete set of criteria with which to evaluate projects? 3. Evaluate the “Minimum Acceptable IRR” returns that Euroland uses for different types of projects. (See page 326.) When, if ever, should these returns be used as the hurdle rate instead of WACC? 4. Evaluate Euroland’s capital rationing. Do you agree or disagree with this policy? Why? If you disagree, then what policy should Euroland follow? 5. In Exhibit 3, rank order (from first to fifth) the five most profitable of the 11 projects, in accordance with correct, risk adjusted capital-budgeting criteria. State the NPV of each of the five projects. Explain your ranking criteria. (Note: create a table showing ONLY the five most profitable projects and their profitability; do NOT state any other projects.) 6. Did Euroland take risk into account in its capital budgeting? If so, how? Which project is the riskiest, and why? There are several reasons why the riskiest project is riskiest; name three reasons. 7. Which of the 11 possible projects was not evaluated in Exhibit 3? Why do you think it was not evaluated? Calculate...
Words: 393 - Pages: 2
...BRANNIGAN FOODS STRATEGIC MARKETING PLANNING CASE SOLUTION PDF Copyright © 2014. All Right Reserved BRANNIGAN FOODS STRATEGIC MARKETING PLANNING CASE SOLUTION PDF Download: BRANNIGAN FOODS STRATEGIC MARKETING PLANNING CASE SOLUTION PDF Are you trying to find Ebook Brannigan Foods Strategic Marketing Planning Case Solution PDF?. You will be happy to recognize that today Ebook Brannigan Foods Strategic Marketing Planning Case Solution PDF is offered on our on-line collection. With our on-line resources, you will certainly be able to locate Ebook Brannigan Foods Strategic Marketing Planning Case Solution PDF or practically any sort of sort of manual, for any kind of type of product. Best of all, they are completely complimentary to find, use as well as download and install, so there is no price or anxiety in any way. Ebook Brannigan Foods Strategic Marketing Planning Case Solution PDF may not make exciting reading, however Ebook Brannigan Foods Strategic Marketing Planning Case Solution PDF is stuffed with valuable guidelines, information and warnings. We have made it very easy for you to locate a user manual with no digging. And by having access to our manual online or by storing it on your computer system, you have hassle-free answers with Ebook Brannigan Foods Strategic Marketing Planning Case Solution PDF. To obtain begun locating Ebook Brannigan Foods Strategic Marketing Planning Case Solution PDF, you correct to locate our site which has a comprehensive collection of Ebooks...
Words: 1371 - Pages: 6
...INTRODUCTION On May 14th 1947, in the Royal Albert Hall, Sir Winston Churchill said, "We are ourselves content, in the first instance, to present the idea of United Europe, in which our country will play a decisive part, as a moral, cultural and spiritual conception to which all can rally without being disturbed by divergences about structure. It is for the responsible statesmen, who have the conduct of affairs in their hands and the power of executive action, to shape and fashion the structure. It is for us to lay the atmosphere and give the driving impulsion." Ironically, today, only Britain could possibly rival Denmark for anti-EMU (European Monetary Union) feelings. In 1992, after tough negotiations, Great Britain signed the Treaty of Maastricht but with a special demand: an opt-in option. This meant that Britain could join the EMU whenever it decided to do so. Ever since the election of Prime Minister Tony Blair and his Labour Party, the government argues that the country should join the EMU when and if the economic conditions are right. Denmark had asked in the Treaty of Maastricht for an opt-in option, however, on September 28th, 53% of the Danes decided to keep the krone. Economically, the UK would find more advantages than not in joining the Euro zone, as shows the following table[1]: |Advantages of entry |Disadvantages of entry ...
Words: 3967 - Pages: 16
...The University of Lethbridge Calgary Campus Faculty of Management Management 4430Y Financial Management Spring 2011 A.P. Palasvirta Office: Markin 4132, Lethbridge Phone: (403) 332-4582 e-mail: oz.palasvirta@uleth.ca Goal of Course Management 4430 is the capstone course in finance and will incorporate concepts you have learned in through your study of corporate, investments, and international. We will utilize the case methodology to focus our analysis. Cases describe a context in which a particular problem is found. Regardless of the particular characteristics of the problem, problem solving follows a general methodology: identification of the problem, describing the context of the problem, analysis of potential alternative solutions, the identification of the best solution, implementation of the best solution , and the creation of controls and contingency plans, if applicable. Text and Other Sources: E-book based on Case Studies in Finance, 6th ed., 2010, McGraw Hill, Toronto, ISBN Prerequisites Management 3412, Fundamentals of Investments Investments, Analysis & Management, 2nd Canadian Ed., 2005, Cleary & Jones, John Wiley & Sons Canada Ltd., Mississauga ISBN 0-470-83542-7 Management 3460, Corporate Finance Fundamentals of Corporate Finance, 6th Canadian Ed., 2007, Ross, Westerfield, Jordan, & Roberts, McGraw-Hill Ryerson, Toronto ISBN 13: 978-0-07-095910-1 A list of topics for which you should have working knowledge...
Words: 2667 - Pages: 11
...which will have a direct effect on the UK clothing retail industry in the near future. Due to the EU membership a trend can be seen towards stricter environmental protection legislation. This may have a direct or indirect effect on NEXT or his suppliers. Economic factors: The current economic climate in the UK is unstable and this brings short term volatility in NEXT sales which, in turn, make forecasting difficult. In addition, the weakness of Sterling against the US Dollar and the Euro, the main purchasing currencies, has brought further challenges to their buying teams. (Next financial statement, 2009) Looking at the economic environment, it is somewhat tricky since on the one hand there is the strong sterling compared to the Euro. Euroland encourages imports and try to hold domestic prices at an attractive level. But on the other hand it is difficult for the UK to be competitive outside its boundaries because of the high pound sterling exchange rate against the Euro. As NEXT sells about 96% in the UK marketplace, this may currently only have a limited effect, but could be more important in the future when thinking globally. This can also be seen on the "Big Mac - Cross Rates" table, where hamburgers sold in the UK are more expensive than in...
Words: 554 - Pages: 3
...Het bestaan van geld In dit essay zal het bestaan van geld besproken worden. Eerst zal gekeken worden naar de sociale ontologie van geld. Vervolgens zal uitgelegd worden waarom geld bestaat. Daarna zal ingegaan worden op de huidige problemen met de Euro. Op basis van het besprokene zal een conclusie worden getrokken of de Euro kan overleven. De ontologie van geld kan afgeleid worden van wat Keynes (1930) omschrijft als de ‘beschrijving’ van geld als een rekenmunt. De Euro en Dollar hebben niet zozeer waarde omdat ze een bepaalde eigenschap van geld hebben, maar juist doordat we de sociale betekenis ervan accepteren. Het is geld, omdat we erkennen dat het geld is. Deze sociale ontologie zorgt ervoor dat het de aard kan hebben van een self-‐fullfilling prophecy. Zodra één partij het vertrouwen verliest, kan dit het einde betekenen van bijvoorbeeld de Euro. Geld kan gezien...
Words: 707 - Pages: 3
...Introduction Monetary policies suggest greater attention over the world by renewed the interest in employing the central banks to control the money supply. Role of monetary policy is important to maintain a low and stable rate of inflation and price stability in the economy.(Rangarajan,1998) Imbalances of the import and export can cause the fluctuation of the exchange rate in the country. Different central bank used different monetary tools to control the money supply and maintain the economic stability of the country. Monetary Tools Used to Control the Money Supply 1. Bank of England (BoE) BoE used operational standing facilities (OSF) and interest rate (IR) to control the money supply in the countries. OSF is used to provide a security value for the market liquidity management and provides an arbitrage instruments in a standard market condition to make sure the IR will be in line with the Bank Rate. OSF gives bank resources to manage unexpected frictional payments shocks that could take the reserves accounting below zero.(Red Book-BoE,2010) IR is used to control the inflation rate by injecting money directly into the British economy by purchasing the government bonds and high quality corporate bonds. Reduction in bank IR cause borrowing more attractive and saving less attractive, this will affects the spending by companies and their customers over time the rate of inflation.(Niklov,2002) IR will cause the increase in exchange rates in Sterling relative to overseas...
Words: 1080 - Pages: 5
...SAMPLE Answers Business Economics Answer ALL the questions in Section A (which carries 60% of the total marks), and ONE question from Section B. Section A. Answer all ten questions. Each question is equally weighted. 1. Economists analyse markets in terms of models which correspond to certain ideal types - perfect competition, monopoly, oligopoly and imperfect competition. Which of these models would you choose to analyse the following markets in the UK? minicabs in London – monopolistic competition potatoes – perfect competition water and sewerage services in London - monopoly package holidays - oligopoly fish 'n chip shops – monopolistic competition universities - oligopoly 2. The following table shows the output of an agricultural commodity over a ten year period together with the price output price (£/tonne) 2000 100 8 2010 200 12 Based on this data work out the coefficient for the elasticity of supply. Answer %∆Q= (200-100)/100x100=100 %∆P=(12-8)/8x100=50 PES = %∆Q/%∆P PES = 100/50 PES=2 When the coefficient is greater than one, the supply can be described as elastic. State whether the following statements are true or false and briefly explain why:- a) The supply of this commodity seems to be inelastic. False b) The percentage increase in output is more than the percentage increase in price. Therefore supply is said to be elastic. True c) We would expect supply to be elastic since it is easier for farmers...
Words: 1886 - Pages: 8
...FIN 4414 Financial Management Course Syllabus Spring 2010 Term INSTRUCTOR: Dr. T. Craig Tapley Graham-Buffett Master Lecturer of Finance Section: Section: Room: 2109 – Monday and Wednesday, Periods 3-4 (9:35 a.m. – 11:30 a.m.) 7111 – Monday and Wednesday, Periods 5-6 (11:45 a.m. – 1:40 p.m.) 112 Matherly Hall Office Hours: Wednesday (2:00 p.m. - 3:00 p.m.) Thursday (1:00 p.m. - 2:30 p.m.) CONTACT INFORMATION: Office: Phone: Fax: E-Mail: 329 David Stuzin Hall (352) 392-6654 (352) 392-5237 ctapley@ufl.edu http://vista.courses.ufl.edu/ Class Webpage: COURSE MATERIALS: TEXTBOOK 1. Financial Management: Theory and Practice (12th Edition), Eugene F. Brigham and Michael C. Ehrhardt, Thompson/South-Western, 2008, ISBN: 0-324-42269-5. The official textbook for the class will be an excellent reference book as you start your career, as you may easily find that there will be times, on the job, when you need to reference prior material, or formulas, covered in your corporate finance classes at UF. However, books have become somewhat expensive, so you may, instead, purchase the 11th or 10th Edition of the book, typically at a cheaper price, through various online booksellers. However, there are minor differences between the 10th, 11th, and 12th editions; mainly in the order of the chapter. These differences should not impact your ability to perform well in this class, but you may need to map the chapters in the 10th or 11th Edition to those assigned in the 12th Edition. This is...
Words: 10794 - Pages: 44
...Abstract Like any other form of business or enterprise, investing internationally is a risk that can be turned into opportunity once well managed. There is a veritable sea of benefits in international portfolio investment. These include participation in the growth of other countries, hedging against exchange rate exposure to risk, diversification benefits and advantages (abnormal returns) of market segmentation on a global scale. However, we cannot be so overwhelmed by the payoff of international portfolio investment as to overlook the bitter side of it. In an international environment, financial investments are not only subject to currency risk and political risk, but also to many institutional constraints and barriers. What are crucial in international portfolio investment are optimal portfolio allocation and the associated market and currency risks. Diversification into multiple securities can practically eliminate potential severe losses from any individual security. However, domestic diversification cannot remove systematic market risk due to high correlations among most domestic securities. Since market risk differs from country to country, international diversification can reduce substantially the overall risk exposure of investment portfolios. Introduction and Overview Increased global competition and opportunity have attracted many national economies and individual domestic businesses to the international markets. In recent...
Words: 3315 - Pages: 14
...Den Europæiske Union Mathias Randel Søndergaard Fællesdel 1) Jeg har lavet en model hvor man følger udviklingen fra vælgerens tanker starter, til han sætter sit kryds. Her er der især 5 vigtige faktorer vi har kigget på: 1. Grundholdninger – dette er en faktor, da du højst sandsynligt stemmer på nogle med samme grundholdninger som dig. Det kan være kultur, økonomi osv., og dette påvirkes især gennem opdragelse og generelt ens omgangskreds. 2. Vælgertype – du kan være en egotropisk eller sociotropisk vælgertype. Det betyder at du enten stemmer ud fra hvad passer din situation, eller ud fra hvad der passer samfundet bedst. 3. Erhverv og fritid – I EU er der visse erhverv der modtager større støtte end andre, såsom landbrug. Da erhverv spiller en stor rolle for individet, er det naturligt at dette fokus på ens erhverv fra EU er vigtigt for ens valg. Ligeledes er det med ens fritidsinteresser, hvor for eksempel fokus på kultur fra visse repræsentanter kan påvirke de kulturelle vælgere. 4. Kandidater - et eksempel kunne være Morten Messerschmidt. Mange vælgere følger debatter, og via dem udvælger hvem der er skarpe. Derudover er kandidaternes fremtoning og evne til at promovere sig selv vigtig, for at valget skal falde på dem som kandidat. Formår de at sige det vælgerne gerne vil høre ved brug af populisme og fremstå pålidelig kan det højst sandsynligt skaffe dem mange stemmer. På den måde er de en vigtig del af processen fra vælgeren overvejer hvem personen...
Words: 2444 - Pages: 10
