Anexo 1 Envíos mensuales al precio de venta (miles de dólares)

Forecast as of
Month Actual
September 2012 Previsión a mayo de 2013
2012 October 6,508 6,421
November 6,219 6,302
December 6,250 6,009
2013 January 6,074 6,170
February 5,996 6,006
March 6,291 5,197
April 6,515 4,165
May 6,832 3,744
Eight months total 50,685 44,014

June 6,759 12,681

July 6,645 7,374
August 6,478 7,201
September 6,433 7,394
Twelve months total 26,315 34,650

Fiscal year total 77,000 78,664

sión a mayo de 2013
Exhibit 2 Balance Sheets, 2012-2013 (thousands of dollars)

2012
August September October November December
Cash 8,350 3,328 3,523 4,511 4,239
Accounts receivable a
5,793 5,969 6,421 5,851 6,009
Inventory 7,154 7,364 7,524 7,219 7,277
Current assets 21,297 16,661 17,468 17,581 17,525

Gross PP&E 45,500 45,500 45,500 45,500 45,500

Accumulated depreciation b
30,368 30,488 30,608 30,728 30,848
Net PP&E 15,132 15,012 14,892 14,772 14,652
Prepaid expenses 242 58 23 45 47
Total assets 36,671 31,731 32,383 32,398 32,224

Accounts payablec 4,977 5,197 5,347 5,352 5,110

Notes payable, bank 0 5,000 5,000 5,000 5,000
Accrued taxesd 252 4 174 331 107
Other accrued expenses 1,500 1,542 1,542 1,542 1,542
Customer advance payments 1,651 1,651 1,651 1,200 1,200
Current liabilities 8,380 13,394 13,714 13,425 12,959

Shareholders' equity 28,291 18,337 18,668 18,973 19,265

Total liabilities and equity 36,671 31,731 32,383 32,398 32,224

a
Selling term of net 30 days.
b
Depreciation of $120,000 per month.
c
Purchase terms of net 30 days.
d
Outstanding taxes on 2012 fiscal year income were due January 15, 2013. On December 15, 2011, March 15, 2012, June 15, 2012, and Sep
the estimated tax for 2012 ($1,500,000) were due. Taxes payable for 2013 were assumed to be $1,500,000 and would be paid on December 1
September 15, 2013, in equal increments.
 2013
January February March April May
4,878 5,182 3,962 6,277 4,994
6,170 5,606 5,197 3,365 3,744
7,097 7,529 8,371 11,234 12,163
18,145 18,317 17,530 20,876 20,901

45,500 45,500 45,500 45,500 45,500

30,968 31,088 31,208 31,328 31,448
14,532 14,412 14,292 14,172 14,052
52 65 46 46 54
32,729 32,794 31,868 35,094 35,007

5,130 5,162 5,122 6,223 5,969

5,000 5,000 5,000 5,000 5,000
269 417 140 216 273
1,542 1,542 1,142 1,142 1,142
1,200 800 800 2,700 2,700
13,141 12,921 12,204 15,281 15,084

19,588 19,874 19,664 19,813 19,923

32,729 32,794 31,868 35,094 35,007

March 15, 2012, June 15, 2012, and September 15, 2012, payments of 25% of each of
0,000 and would be paid on December 15, 2012, March 15, 2013, June 15, 2013, and
Exhibit 3 Income Statements, 2012-2013 (thousands of dollars)

Fiscal Year
2012 Ending 2012 2012 2012 2013
2012 August September 09/30/2012 October November December January
Net sales 6,321 5,969 71,642 6,421 6,302 6,009 6,170
COGS 4,994 4,727 56,955 5,003 4,914 4,695 4,815
Gross profit 1,327 1,242 14,687 1,418 1,388 1,314 1,355

Operating expenses 773 763 9,509 777 788 733 728

Depreciation and amortization 120 120 1,440 120 120 120 120
Interest expensea 0 0 0 25 25 25 25
Interest incomeb 13 14 120 6 6 8 7
Profit (loss) before tax 447 373 3,858 502 461 443 489
Income taxesc 152 127 1,312 171 157 151 166
Net income 295 246 2,546 331 304 293 323
Dividends 0 200 400 0 0 0 0

a
6% annualized interest rate charged on outstanding bank loans.
b
2% annualized rate of return on beginning monthly cash balances.
c
The federal tax rate on all earnings was 34%.
 Eight
2013 2013 2013 2013 Months
February March April May Total
6,006 5,197 4,165 3,744 44,014
4,692 4,087 3,215 2,876 34,297
1,314 1,110 950 868 9,717

744 685 587 566 5,608

120 120 120 120 960
25 25 25 25 200
8 9 7 10 60
433 289 225 167 3,009
147 98 76 57 1,023
286 191 148 111 1,986
0 400 0 0 400
Exhibit TN-1 Sources and Uses of Funds, August 31, 2012 to May 31, 2013 (thousands of dollars)

Sources of Funds
Increase in bank debt 5,000
Decrease in cash 3,356
Disminución de cuentas por cobrar 2,049
Aumento de ganancias retenidas 1,632
Disminución del activo fijo neto 1,080
Incremento de anticipos de clientes 1,049
Aumento de cuentas por pagar 992
Disminución de gastos prepagos 188
Aumento de impuestos por pagar 21
Fuentes totales de fondos 15,367

Uses of Funds
Recompra de acciones 10,000
inventarios 5,009
Disminución de las acumulaciones 358
Usos totales de fondos 15,367
Exhibit TN-2 Pro Forma Cash Budget, June to October 2013 (thousands of dollars)

June July August September October

Beginning Cash Balance 4,994 1,627 6,536 7,034 (715)

Cash Receipts
Cobros de cuentas por cobrar 3,744 10,881 6,474 7,201 7,394
Ingresos por intereses 8.32 3 11 12 0 0.0016667
Préstamo bancario 0 2,400 0 0 0
Entrada de efectivo total 3,752 13,284 6,485 7,213 7,394

Cash Disbursements
Pagos de cuentas por pagar 5,969 5,200 5,200 5,200 5,200
Los gastos de explotación 750 750 750 750 750
Gastos de capital 0 2,400 0 0 0
Pago de impuestos 375 0 0 375 0
Pagos de interés 25 25 37 37 0
Pagos de capital 0 0 0 7,400 0
Pago dividendos 0 0 0 1,200 0
Salida total de efectivo 7,119 8,375 5,987 14,962 5,950

Entrada neta de efectivo (salida) (3,367) 4,909 498 (7,749) 1,444

Ending Cash Balance 1,627 6,536 7,034 (715) 729

a: reducción inminente de $ 5,040 del trabajo en progreso en junio, más $ 2,440 de niveles de inventario anormales distribuidos de manera u
 8.3235142

es distribuidos de manera uniforme durante cuatro meses, más compras mensuales de materiales.
Exhibit TN-3 Pro Forma Income Statements, June to October 2013 (thousands of dollars)

Four Months
June July August September
Total
Net sales 12,681 7,374 7,201 7,394 34,650
COGS a
10,850 5,810 5,810 5,810 28,280
Gross profit 1,831 1,564 1,391 1,584 6,370

Operating expenses 750 750 750 750 3,000

Depreciation and amortization 120 120 130 130 500
Interest expenseb 25 25 37 37 124
Interest income c
8 3 11 12 34
Profit (loss) before tax 944 672 485 679 2,780
Income taxesd 321 228 165 231 945
Net income 623 443 320 448 1,835
Dividends 0 0 0 1,200 1,200

a: $5,040 imminent reduction of work-in-progress in June, plus $2,440 of abnormal inventory levels spread
evenly over four months, plus monthly materials purchases.
b
6% annualized interest rate charged on outstanding debt.
c
2% annualized rate of return on the cash balance.
d
34% tax rate.
a: reducción inminente de $ 5,040 del trabajo en progreso en junio, más $ 2,440 de niveles de inventario anormales distribuidos de manera uniforme
durante cuatro meses, más compras mensuales de materiales.
idos de manera uniforme
Exhibit TN-4 Pro Forma Balance Sheets, June to October 2013 (thousands of dollars)

June July August September

Cash 1,627 6,536 7,034 (715)
Accounts receivable a
10,881 6,474 7,201 7,394
Inventory 6,513 5,903 5,293 4,683
Current assets 19,021 18,913 19,528 11,362

activo fijo bruto 45,500 47,900 47,900 47,900

depreciacion acumulada 31,568 31,688 31,818 31,948
activo fijo neto 13,932 16,212 16,082 15,952
gastos anticipados 54 54 54 54
actuvo total 33,007 35,179 35,664 27,368

Accounts payablec 5,200 5,200 5,200 5,200

Notes payable, bank 5,000 7,400 7,400 0
Accrued taxesd 219 448 612 468
Other accrued expenses 1,142 1,142 1,142 1,142
Customer advance payments 900 0 0 0
Current liabilities 12,461 14,190 14,354 6,810

Shareholders' equity 20,546 20,990 21,310 20,558

Total liabilities and equity 33,007 35,179 35,664 27,368

a
Selling terms of net 30 days. AR in June reflects the difference between June sales and the $1.8 million shipment for which the company re
difference between July sales and the $900,000 remaining customer advances ($2.7 million - $1.8 million).
b
Depreciation for existing PP&E is $120,000 per month. Depreciation for new PP&E is $10,000 per month.
c
Purchase terms of net 30 days.
d
Outstanding taxes on 2012 fiscal year income were due on January 15, 2013. On December 15, 2011, March 15, 2012, June 15, 2012, and S
estimated tax for 2012 ($1,500,000) were due. Taxes payable for 2013 were assumed to be $1,500,000 and would be paid on December 15, 2
15, 2013, in equal increments.
013 (thousands of dollars)

Notes
Reconciliation with cash budget
September sales
Inventory at beginning of June minus $5,040,000 work in progress, minus $2,440,000 raw materials

Beginning PP&E plus $2.4 million capital expenditure

Beginning accumulated depreciation plus $480,000 plus $20,000.

Unchanged

September purchases
Both loans paid off in September
Beginning tax liability plus additional tax liability in four months minus two payments of $375 each
Unchanged

Beginning shareholders' equity plus retained earnings over four months

ne sales and the $1.8 million shipment for which the company received customer advances. AR in July reflects the
es ($2.7 million - $1.8 million).
ew PP&E is $10,000 per month.

Jane Cormuss:
13. On December 15, 2011, March 15, 2012, June 15, 2012, and September 15, 2012, payments of 25% of each of the Last line should include
assumed to be $1,500,000 and would be paid on December 15, 2012, March 15, 2013, June 15, 2013, and September comma following final
date for 2013.
Jane Cormuss:
Last line should include
comma following final
date for 2013.
Exhibit TN-5 Sensitivity Analysis - The Impact of Sales Drop on September Cash Balance

Sales Increase / Dropa

-10% -5% 0% 5% 10%
2400 (4,646) (3,281) (1,915) (550) 816
1800 (4,046) (2,681) (1,315) 50 1,416
Dividend

1200 (3,446) (2,081) (715) 650 2,016

600 (2,846) (1,481) (115) 1,250 2,616
0 (2,246) (881) 485 1,850 3,216

a
Sales drop is assumed to be evenly distributed over four months.
Exhibit TN-6 Capacity Analysis for 2013 Fiscal Year

2012 2013
October November December January February March April May June

Profitability ratios
Return on equity (1 month) 1.79% 1.62% 1.53% 1.66% 1.45% 0.96% 0.75% 0.56% 3.08%
Return on assets (1 month) 1.03% 0.94% 0.91% 0.99% 0.87% 0.59% 0.44% 0.32% 1.83%
Profit margin 5.16% 4.83% 4.87% 5.23% 4.76% 3.67% 3.56% 2.95% 4.91%

Short-term solvency ratios

Current ratio 1.27x 1.31x 1.35x 1.38x 1.42x 1.44x 1.37x 1.39x 1.53x
Quick ratio 0.73x 0.77x 0.79x 0.84x 0.83x 0.75x 0.63x 0.58x 1.00x

Leverage ratios
Total debt to capitalization 42.35% 41.44% 40.21% 40.15% 39.40% 38.29% 43.54% 43.09% 37.75%

Coverage ratios
EBITDA interest coverage 25.64x 24.01x 23.24x 25.08x 22.80x 17.00x 14.52x 12.08x 43.24x
EBIT interest coverage 20.84x 19.21x 18.44x 20.28x 18.00x 12.20x 9.72x 7.28x 38.44x
013
July August September

2.11% 1.51% 2.14%

1.30% 0.90% 1.42%
6.01% 4.44% 6.06%

1.33x 1.36x 1.67x

0.92x 0.99x 0.98x

40.33% 40.25% 24.88%

32.56x 17.32x 22.54x

27.76x 13.81x 19.03x