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Footwear Industry Report

FIR 07-Aug-2019

Industry 1 Biegala MGT495-01

Summer

Year 17

© GLO-BUS Software, Inc.

Year 17 Scoreboard    

Rank

   

Company Name

Investor Expectation

Score

Best-In- Industry Score

Weighted Average

Score

  Change

from Y16

1 J-Doyen 114 98 106 +2 2 K ASM 112 86 99 +1 3 B Cielo 112 82 97 +1 4 H Road Runner 105 69 87 +14 5 DTigers 96 64 80 +7 6 E Elite Footwear 89 58 74 0 7 IPure Steps 61 45 53 +3 8 G - Star 55 42 49 -3 9 ADragons 53 40 47 -1

10 C Shoe 51 41 46 -1 11 FFlying wings 46 20 33 -24

Game-To-Date Scoreboard    

Rank

   

Company Name

Investor Expectation

Score

Best-In- Industry Score

Weighted Average

Score

  Bonus Points

Overall G-T-D Score

1 J-Doyen 116 100 108 3 111 2 B Cielo 114 84 99 3 102 3 K ASM 113 87 100 1 101 4 H Road Runner 108 73 91 3 94 5 DTigers 97 69 83 2 85 6 E Elite Footwear 91 61 76 4 80 7 IPure Steps 69 50 60 2 62 8 ADragons 62 46 54 3 57 8 G - Star 61 46 54 1 55

10 C Shoe 55 44 50 0 50 11 FFlying wings 54 40 47 1 48

Investor Expectation Score (I.E.)

Investors and company boards of directors have established targets for the five scoring measures that appear on pages 2 and 3 of this report. The I.E. score ranges from 0 to 120 (if all targets are exceeded by 40% or more). Click the Help button (upper-right) for more information.

Best-In- Industry Score (B­I­I)

The B-I-I score measures each company's performance relative to the best performing company on each of the five scoring measure. The B-I-I score ranges from 0 to 100. To score 100 a company must be the best performing company in the industry on all five scoring measures.

Weighted Average Score

The weighted average score combines the Investor Expectation Score and the Best-In-Industry Score using a 50%-50% weighting as specified by the course instructor. Detailed explanations of scoring are provided in the Help documents asociated with pages 1, 2, and 3 of this report.

Page 1

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Industry 1 SCORING MEASURES Year 17  

Earnings Per Share ($ per share)

Earnings Per Share scores are based on a 20% (20-point) weighting. A bolded number indicates achievement of the investor expected EPS shown below each yearly column head. A highlighted number indicates best-in- industry performance. Game-To-Date EPS scores are based on a weighted average of the annual EPS performances.

Y11 (2.50)

Y12 (3.00)

Y13 (3.50)

Y14 (4.00)

Y15 (4.50)

Y16 (5.25)

Y17 (6.00)

Y18 (7.00)

Y19 (8.50)

Y20 (10.00)

Wgt. Avg. (4.11) I.E. B­I­I

Y17 Score I.E. B­I­I

G-T-D Score

A 2.57 2.94 1.89 1.74 3.16 2.06 1.95 2.33 7 2 11 5 A B 4.61 4.22 4.79 6.70 8.58 10.65 12.62 7.41 24 14 24 15 B C 2.26 2.57 1.10 2.19 1.91 1.65 2.14 1.95 7 2 9 4 C D 2.37 4.59 5.19 5.21 7.79 6.88 8.25 5.71 24 9 24 12 D E 1.42 2.94 2.97 3.66 5.23 5.34 6.02 3.92 20 7 19 8 E F 1.48 3.86 3.96 4.14 3.96 1.31 2.16 2.99 7 2 15 6 F G 2.32 2.84 2.90 3.58 2.09 3.27 3.29 2.90 11 4 14 6 G H 4.05 6.74 7.40 6.57 6.02 5.94 9.19 6.52 24 11 24 13 H I 2.71 3.11 2.70 2.87 2.32 2.24 3.06 2.72 10 4 13 6 I J 2.27 4.74 7.14 10.47 13.10 14.72 17.42 9.88 24 20 24 20 J K 2.31 4.19 5.29 7.81 9.46 10.86 12.12 7.25 24 14 24 15 K

Return On Equity (%)

Return On Equity scores are based on a 20% (20-point) weighting. A bolded number indicates achievement of the investor expected ROE shown below each yearly column head. A highlighted number indicates best-in- industry performance. Game-To-Date ROE scores are based on a weighted average of the annual ROE performances.

Y11 (21.0)

Y12 (22.0)

Y13 (23.0)

Y14 (24.0)

Y15 (25.0)

Y16 (26.0)

Y17 (27.0)

Y18 (28.0)

Y19 (29.0)

Y20 (30.0)

Wgt. Avg. (24.0) I.E. B­I­I

Y17 Score I.E. B­I­I

G-T-D Score

A 21.8 20.2 11.2 9.2 14.9 9.0 8.4 12.6 6 5 11 8 A B 36.0 24.5 22.1 24.5 24.5 24.5 26.1 25.3 19 15 21 16 B C 19.4 18.6 7.7 12.4 9.7 7.8 9.5 11.1 7 6 9 7 C D 22.7 41.5 38.4 24.4 27.3 22.7 26.9 27.5 20 16 21 18 D E 12.6 21.9 18.1 18.3 21.1 18.8 19.3 19.0 14 11 16 12 E F 13.2 28.1 23.3 24.6 26.3 44.7 n.m. 30.0 20 0 23 19 F G 19.9 20.0 19.2 21.9 10.9 15.0 13.1 16.4 10 8 14 11 G H 33.0 38.7 29.4 19.9 15.7 14.6 22.3 22.3 17 13 19 14 H I 22.9 21.0 15.3 14.1 10.0 9.2 11.4 13.8 8 7 12 9 I J 19.6 31.8 34.2 35.3 32.9 29.6 30.4 31.2 21 18 23 20 J K 19.8 28.1 26.9 32.8 33.0 31.5 34.1 30.7 23 20 23 20 K

Stock Price ($ per share)

Stock Price scores are based on a 20% (20-point) weighting. A bolded number indicates achievement of the investor expected stock price shown below each yearly column head. A highlighted number indicates best-in- industry performance. Game-To-Date scores are based solely on the most recent year's stock price.

Y11 (40.00)

Y12 (50.00)

Y13 (65.00)

Y14 (80.00)

Y15 (100.00)

Y16 (125.00)

Y17 (150.00)

Y18 (180.00)

Y19 (215.00)

Y20 (250.00) I.E. B­I­I

Y17 Score I.E. B­I­I

G-T-D Score

A 33.46 45.06 18.88 8.82 27.24 20.37 9.24 1 0 1 0 A B 121.59 83.05 88.69 130.89 188.88 239.82 277.78 24 13 24 13 B C 22.86 21.18 8.49 14.03 13.22 12.09 9.36 1 0 1 0 C D 48.77 120.70 122.75 99.07 159.71 119.06 130.34 17 6 17 6 D E 11.86 35.44 32.74 58.32 86.32 80.94 86.67 12 4 12 4 E F 11.76 58.38 68.43 72.32 45.87 18.65 10.81 1 1 1 1 F G 20.47 31.72 57.28 38.44 16.03 21.55 14.80 2 1 2 1 G H 102.76 178.88 185.71 124.92 94.96 76.43 165.45 21 8 21 8 H I 35.55 46.77 24.37 24.71 18.73 14.96 29.91 4 1 4 1 I J 22.39 102.04 186.55 275.83 340.67 368.88 418.71 24 20 24 20 J K 26.32 92.42 111.75 191.48 222.74 239.49 267.42 24 13 24 13 K

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Industry 1 SCORING MEASURES Year 17 (concluded)  

Credit Rating Credit Rating scores are based on a 20% (20-point) weighting. A bolded credit rating indicates achievement of the investor expected credit rating shown below each yearly column head. Game-To-Date credit rating scores are based solely on the most recent year's credit rating performance.

Y11 (B+)

Y12 (B+)

Y13 (B+)

Y14 (A–)

Y15 (A–)

Y16 (A–)

Y17 (A)

Y18 (A)

Y19 (A)

Y20 (A) I.E. B­I­I

Y17 Score I.E. B­I­I

G-T-D Score

A A A A– A A+ A+ A+ 24 20 24 20 A B A A+ A+ A+ A+ A+ A+ 24 20 24 20 B C A– A A+ A+ A+ A+ A 20 19 20 19 C D A A– B– A A B– B 14 14 14 14 D E B A A+ A– A A+ A+ 24 20 24 20 E F B A A+ A A– A– C– 0 1 0 1 F G A– A A+ A+ A+ B+ B 14 14 14 14 G H A A A A+ A+ A+ A+ 24 20 24 20 H I A A A A+ A+ A+ A+ 24 20 24 20 I J A– A A+ A+ A+ A+ A+ 24 20 24 20 J K A– A A+ A A A A 20 19 20 19 K

Image Rating Image Rating scores are based on a 20% (20-point) weighting. A bolded number indicates achievement of the investor expected image rating shown below each yearly column head. A highlighted number indicates best-in- industry performance. Game-To-Date scores are based on an average of the most recent three years.

Y11 (70)

Y12 (72)

Y13 (72)

Y14 (75)

Y15 (75)

Y16 (77)

Y17 (77)

Y18 (80)

Y19 (80)

Y20 (80)

Y15-Y17 Average I.E. B­I­I

Y17 Score I.E. B­I­I

G-T-D Score

A 70 67 61 58 62 55 56 58 15 13 15 13 A B 75 74 76 82 83 91 88 87 21 20 21 20 B C 68 57 64 51 57 63 63 61 16 14 16 14 C D 71 68 81 76 84 81 84 83 21 19 21 19 D E 68 69 68 75 77 76 72 75 19 16 20 17 E F 76 73 72 67 58 42 70 57 18 16 15 13 F G 65 68 66 64 58 64 68 63 18 15 17 14 G H 84 85 84 78 81 80 75 79 19 17 20 18 H I 68 65 68 62 65 60 58 61 15 13 16 14 I J 64 71 83 85 87 89 86 87 21 20 21 20 J K 74 87 84 90 87 91 87 88 21 20 22 20 K

High Average Low Total Dollars ($000s)

High Average Low Per Unit Sold ($/unit)

Industry 1 Cash Outlays for Corporate Social Responsibility and Citizenship

High Average Low

Image Rating Points Generated from

CSRC Expenditures

Year 11 15,457 8,714 0 1.85 1.03 0.00 5 3 0 Year 12 15,222 4,502 0 1.77 0.51 0.00 9 4 0 Year 13 18,323 6,596 0 1.45 0.61 0.00 12 6 0 Year 14 22,403 5,486 0 2.13 0.53 0.00 15 7 0 Year 15 12,725 6,926 0 2.86 0.79 0.00 18 8 0 Year 16 20,427 5,416 0 2.15 0.49 0.00 19 8 0 Year 17 12,705 5,526 0 1.34 0.50 0.00 19 8 0 Year 18 Year 19 Year 20

Corporate Social Responsibility and Citizenship

Beginning in Year 14, the World Council for Exemplary Corporate Citizenship presents a distinguished award to the company making the highest cash outlays as a percentage of revenues for corporate social respon- sibility and citizenship initiatives.

Award Winner 2nd Place

Y14 E Elite Footwear K ASM Y15 FFlying wings C Shoe Y16 G - Star E Elite Footwear Y17 G - Star E Elite Footwear Y18 Y19 Y20

Corporate Responsibility Award for Exemplary Corporate Citizenship

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Industry 1 BONUS POINT AWARDS Year 17  

BULL'S  EYE  AWARD for Accurately Forecasting Total Revenues,

Earnings Per Share, and Image Rating

One bonus point added to any company's game-to-date score when actual performance on Total Revenues AND Earnings Per Share vary by no more than 5% from projected performance AND when Image Rating varies by no more than 4 points from the projected image rating.

Year 17 Forecast

Year 17 Actual

Percent Variance

Revenues (within ± 5%) Year 17

Forecast Year 17 Actual

Percent Variance

EPS (within ± 5% or ± 10¢) Year 17

Forecast Year 17 Actual

Point Variance

Image Rating (within ± 4 points) Year 17 Bull's Eye

Award

Cumu- lative

Awards A 381,570 454,773 +19.2% 1.08 1.95 +80.9% 53 56 +3 pts. No 2 A B 1,587,186 1,532,184 -3.5% 13.57 12.62 -7.0% 91 88 -3 pts. No 3 B C 769,333 700,992 -8.9% 2.95 2.14 -27.4% 65 63 -2 pts. No 0 C D 1,242,836 1,250,727 +0.6% 8.29 8.25 -0.5% 86 84 -2 pts. Yes 2 D E 810,855 810,492 0.0% 6.01 6.02 +0.2% 73 72 -1 pts. Yes 4 E F 441,093 231,737 -47.5% 7.05 2.16 -69.4% 77 70 -7 pts. No 0 F G 698,376 605,411 -13.3% 4.81 3.29 -31.6% 71 68 -3 pts. No 1 G H 926,421 914,194 -1.3% 9.47 9.19 -3.0% 75 75 0 pts. Yes 2 H I 642,817 668,948 +4.1% 2.84 3.06 +7.9% 58 58 0 pts. No 2 I J 1,742,067 1,620,159 -7.0% 19.97 17.42 -12.8% 89 86 -3 pts. No 2 J K 1,083,470 1,218,574 +12.5% 9.32 12.12 +30.1% 81 87 +6 pts. No 0 K

Trends in Variances Between Projected and Actual Performance (company and industry variances bertween projected and actual revenues, EPS, and image rating)

Industry 1 Variance

Largest Average Smallest

Company D Variance

Year 11 +9.6% -0.4% -7.4% -3.7%

Year 12 +30.1% +5.2%

-15.2% +27.9%

Year 13 +27.4%

-3.3% -20.0% +27.4%

Year 14 +10.0%

-4.8% -18.9%

-5.7%

Year 15 +11.5%

-5.6% -21.1% +9.7%

Year 16 +22.5%

-4.3% -21.9%

-2.7%

Year 17 +35.8%

-2.8% -42.0%

-0.7%

Year 18 Year 19 Year 20

Y11 Score Δ

Y12 Score Δ

Y13 Score Δ

Y14 Score Δ

Y15 Score Δ

Y16 Score Δ

Y17 Score Δ

Y18 Score Δ

Y19 Score Δ

Y20 Score

Current-Year Scores and Net Changes Cumu- lative

Awards A 83 -5 78 -22 56 -7 49 +12 61 -13 48 -1 47 1 A B 107 -15 92 +1 93 +1 94 +2 96 0 96 +1 97 0 B C 74 -8 66 -15 51 +2 53 -2 51 -4 47 -1 46 0 C D 86 +11 97 -6 91 -4 87 +7 94 -21 73 +7 80 0 D E 55 +23 78 -6 72 0 72 +9 81 -7 74 0 74 0 E F 58 +32 90 -3 87 -7 80 -10 70 -13 57 -24 33 1 F G 73 +2 75 +2 77 -5 72 -20 52 0 52 -3 49 0 G H 105 +3 108 -3 105 -15 90 -8 82 -9 73 +14 87 1 H I 84 -5 79 -14 65 -4 61 -6 55 -5 50 +3 53 0 I J 73 +22 95 +13 108 0 108 +1 109 -5 104 +2 106 1 J K 77 +19 96 +2 98 +4 102 -1 101 -3 98 +1 99 1 K

Δ = net change in score between years Highlighted figure = Leap Frog Award winner

Footwear Industry Report Copyright © GLO-BUS Software, Inc. Page 3b

for Most Improved Overall Score (current year to current year)

LEAP  FROG  AWARD Beginning in Year 12, one bonus point is added to the game-to-dateoverall score of the company whose current-year overall score is most improved over the prior year. If all companies fail to improve their scores from one year to the next, then no Leap Frog bonus is awarded.

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Industry 1 INDUSTRY OVERVIEW Year 17  

Materials Prices

Price Adjustments

Materials Usage Facilities Utilization

Base Prices of Materials ($ per pair)

Materials Prices in Year 17 ($ per pair)

$6.00 -0.21 +0.32 $6.11

Standard $12.00 +1.68 +0.65

$14.33

Superior High industry-wide superior materials usage (47.0%) lead to superior materials prices that were 14.0% above the base and standard materials prices that were 3.5% below the base. Industry-wide utilization of production capability was above 110% and resulted in materials price increases of 5.4%.

Notes

Footwear Production and Sales

Branded Demand

(000s of pairs) Forecast Actual

Stockouts No. of Companies Unfilled Orders (000s)

Pairs Available (000s)

Pairs Sold (internet + wholesale)

Private Label

Demand Forecast (000s of pairs) Pairs Offered (000s) Pairs Sold (000s)

Superior Materials Usage Utilization of Production Capability

North America

44% 115.7% 48,736 37,748 38,610 38,606

2 1

4,389 5,248 4,389

Europe Africa

53% 115.8% 40,537 32,848 33,330 33,332

2 0

4,389 5,346 4,389

Asia Pacific

49% 114.4% 43,888 31,552 32,032 32,030

1 1

4,972 6,210 4,972

Latin America

46% 116.9% 40,464 32,296 32,582 32,582

2 0

4,972 5,906 4,972

Average or Total

47% 115.4% 173,625 134,444 136,554 136,550

  2

18,722 22,710 18,722

⇦ % usage up 1.9 points from Year 16. ⇦ % usage down 1.8 points from Year 16.

⇦ 27.1% higher than Year 17 demand.

⇦ From page 4 of FIR for Year 16. ⇦ Actual branded demand was 1.6% higherthan forecast branded demand due to

increased competitive intensity.

⇦ Extent to which orders for branded pairs went unfilled due to inventory shortages at one or more companies.

⇦ From page 4 of FIR for Year 16. ⇦ Private-label pairs offered was higher than

actual private-label demand by 17.6%.

Notes

Demand Forecast

Branded Demand (internet + wholesale)

Year 18 Year 19 Year 20

Private-Label Demand Year 18 Year 19 Year 20

North America

39,802 41,389 43,043 4,785 5,214 5,687

Europe Africa 34,413 35,784 37,213 4,785 5,214 5,687

Asia Pacific 34,131 36,866 39,814 5,522 6,127 6,798

Latin America

34,801 37,590 40,596 5,522 6,127 6,798

Global Total

143,147 151,629 160,666

20,614 22,682 24,970

Global demand for Y11-Y15 is expected to grow by 7%-9% annually, slowing to 5%-7% during Y16-Y20. The projected growth rates are not the same for all regions, as shown in the table on page 5 of the Player's Guide. Actual demand growth may vary from the forecast due to stronger or weaker competitive efforts on the part of rival companies.

Notes

Supply / Demand Analysis

Beginning Year 18 Inventory Potential Y18 Production (with OT)

Potential Global Supply

37,075 183,600 220,675

Potential Footwear Suppy in Year 18 Branded Demand Forecast Private-Label Demand Forecast

Expected Global Demand

143,147 20,614

163,761

Expected Footwear Demand in Year 18 Potential global supply (at max OT) in the upcoming year is 34.8% greater than projected global demand. This much excess potential supply is certain to greatly intensify competition for the next few years and reduce industry profitability. It is advisable to NOT add more production capability at this time.

Analysis

Facility Space Production Equipment

N.A. E-A A-P L.A.

Year 17 Facility Space (000s of pairs available for prod. equipmernt)

N.A. E-A A-P L.A.

Construction of New Space (initiated in Y17 and available in Y18)

Total Space

Available in Y18 N.A. E-A A-P L.A. Total

Year 17 Production Equipment (000s of pairs available for production)

A 6,000 0 7,000 0 0 0 0 0 13,000 A 4,000 0 2,000 0 6,000 A B 6,000 2,000 7,000 4,000 0 1,000 0 2,000 22,000 B 6,000 2,000 7,000 4,000 19,000 B C 6,000 1,000 6,000 1,000 0 0 0 0 14,000 C 5,500 0 4,250 1,000 10,750 C D 7,000 5,000 8,000 6,000 0 0 0 0 26,000 D 5,750 4,500 6,250 5,000 21,500 D E 7,000 1,000 7,000 2,000 0 1,000 1,000 0 19,000 E 5,500 1,000 4,750 500 11,750 E F 5,000 2,000 7,000 2,000 0 1,000 0 1,000 18,000 F 1,000 1,000 1,250 1,000 4,250 F G 5,000 3,000 6,000 3,000 0 0 0 0 17,000 G 5,000 500 4,500 1,000 11,000 G H 5,000 0 8,000 2,000 0 0 0 0 15,000 H 3,000 0 8,000 2,000 13,000 H I 5,000 0 6,000 2,000 0 0 0 0 13,000 I 3,250 0 6,000 500 9,750 I J 5,000 0 14,000 11,000 0 0 0 0 30,000 J 5,000 0 12,000 9,000 26,000 J K 5,000 0 8,000 7,000 0 0 0 2,000 22,000 K 5,000 0 8,000 7,000 20,000 K

62,000 14,000 84,000 40,000 0 3,000 1,000 5,000 209,000 49,000 9,000 64,000 31,000 153,000

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Industry 1 FINANCIAL PERFORMANCE SUMMARY Year 17  

Income Statement Data ($000s)

Internet Wholesale P-label Total Net Sales Revenues Cost of

Pairs Sold Warehouse Expenses

Marketing Expenses

Admin Expenses

Operating Profit

Interest Exp (Inc)

Income Taxes

Net Profit

A 172,562 222,646 59,565 454,773 231,321 49,269 99,514 17,150 57,519 839 16,704 38,976 A B 344,185 1,044,972 99,918 1,532,184 714,964 98,885 346,306 30,249 341,780 1,144 102,191 238,445 B C 176,932 403,906 91,373 700,992 392,902 66,554 136,828 22,715 81,993 5,702 22,887 53,404 C D 328,695 696,007 141,302 1,250,727 610,913 121,195 225,354 36,151 257,114 31,871 66,897 156,094 D E 278,331 473,449 58,712 810,492 390,408 75,010 153,587 26,400 165,087 2,058 48,909 114,120 E F 89,050 134,194 0 231,737 96,110 23,601 8,076 15,499 88,451 30,826 17,288 40,337 F G 174,228 393,532 18,162 605,411 342,307 62,900 66,950 25,651 107,603 12,638 28,190 65,775 G H 329,797 584,397 0 914,194 408,556 81,359 173,745 23,649 226,885 -1,235 67,752 158,087 H I 220,752 448,196 0 668,948 342,272 67,366 154,783 19,301 85,226 2,117 24,933 58,176 I J 388,583 989,533 169,069 1,620,159 761,334 131,515 227,240 35,149 464,921 6,435 137,546 320,940 J K 287,272 786,587 144,715 1,218,574 579,871 93,992 185,541 32,901 326,269 27,672 88,683 206,928 K

253,672 561,584 71,165 909,836 442,814 79,241 161,629 25,892 200,259 10,915 56,544 131,935

Selected Balance Sheet Data ($000s)

Cash On Hand

Current Assets

Fixed Assets

Total Assets

Assets Current Liabilities

Long-Term Loans

Total Liabilities

Liabilities Beginning

Equity Stock Sale (Purchase)

Earnings Retained

Ending Equity

Shareholder Equity

A 143,236 243,027 265,598 508,625 23,345 9,900 33,245 456,985 -612 19,007 475,380 A B 72,513 448,403 700,252 1,148,655 81,467 189,900 271,367 948,053 -252,510 181,745 877,288 B C 0 191,206 441,255 632,461 48,504 0 48,504 540,553 0 43,404 583,957 C D 52,273 686,724 690,290 1,377,014 406,565 565,000 971,565 755,045 -467,834 118,238 405,449 D E 17,874 179,787 494,639 674,426 35,211 9,900 45,111 554,606 -39,411 114,120 629,315 E F 0 91,766 367,234 459,000 145,637 439,400 585,037 -166,374 0 40,337 -126,037 F G 31,713 312,212 449,695 761,907 91,228 133,900 225,128 471,004 0 65,775 536,779 G H 117,948 326,895 469,880 796,775 39,687 0 39,687 658,966 -39,325 137,447 757,088 H I 14,401 146,651 416,399 563,050 29,248 0 29,248 483,226 0 50,576 533,802 I J 2,385 392,545 763,710 1,156,255 82,701 9,900 92,601 1,050,634 -307,920 320,940 1,063,654 J K 33,086 313,027 755,321 1,068,348 108,401 350,000 458,401 603,595 -200,576 206,928 609,947 K

44,130 302,931 528,570 831,501 99,272 155,264 254,536 577,845 -118,926 118,047 576,966

Selected Financial Statistics

Gross Profit

Margin

Operating Profit

Margin

Net Profit

Margin

Profitability Measures Div. Per Share ($/share)

Total Div. Payment

($000s)

Payout (percent of  net profit)

Dividend Data Credit Rating Measures Interest Coverage

Ratio

Debt to Assets Ratio

Default Risk Ratio

Risk of

Default Current Ratio

Days of Inventory

Shares of Stock

Outstanding (000s of shares)

A 49.1% 12.6% 8.6% 1.00 19,969 51.3% 68.56 0.07 5.77 Low 10.41 62 days 19,969 A B 53.3% 22.3% 15.6% 3.00 56,700 23.8% 298.76 0.24 29.00 Low 5.50 53 days 18,900 B C 44.0% 11.7% 7.6% 0.40 10,000 18.7% 14.38 0.08 2.20 Medium 3.94 82 days 25,000 C D 51.2% 20.6% 12.5% 2.00 37,856 24.2% 8.07 0.71 3.29 Medium 1.69 380 days 18,928 D E 51.8% 20.4% 14.1% 0.00 0 0.0% 80.22 0.07 14.87 Low 5.11 32 days 18,965 E F 58.5% 38.2% 17.4% 0.00 0 0.0% 2.87 1.27 0.19 High 0.63 250 days 18,690 F G 43.5% 17.8% 10.9% 0.00 0 0.0% 8.51 0.30 1.65 High 3.42 206 days 20,000 G H 55.3% 24.8% 17.3% 1.20 20,640 13.1% 1,000.00 0.05 1,000.00 Low 8.24 56 days 17,200 H I 48.8% 12.7% 8.7% 0.40 7,600 13.1% 40.26 0.05 8.95 Low 5.01 22 days 19,000 I J 53.0% 28.7% 19.8% 0.00 0 0.0% 72.25 0.08 5.43 Low 4.75 62 days 18,425 J K 52.4% 26.8% 17.0% 0.00 0 0.0% 11.79 0.43 5.55 Low 2.89 35 days 17,067 K

51.3% 22.0% 14.5% 0.73 13,888 13.1% 60.57 0.30 6.99   4.69 113 days 19,286

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Industry 1 PERFORMANCE BENCHMARKS Year 17  

Production Benchmarks

North America Low Average High Industry 1 Company

D

Labor Statistics

Total Regular Compensation ($ / worker / year) Workforce Productivity (pairs / worker / year) Production Labor Cost ($ per pair after rejects) Supervisory Compensation ($ / supervisor / year)

Branded Production TQM/6-Sigma Spending Current ($/pair produced)

Cumulative ($000s)

Superior Materials Usage

Total Production Cost ($ per pair produced) Reject Rate

Percentage of New Production Equipment

Cost Per S/Q Star (total production cost per pair ÷ S/Q rating)

0% 36,452 4,515 7.47

63,691 18% 0.50

32,066 25.32 1.9% 3.82

83% 44,759 5,104 9.22

65,939 49% 2.08

61,657 30.22 6.0% 5.23

100% 51,528 5,363 10.44

73,641 100%

5.00 194,100

38.17 9.7% 7.34

74% 48,774 5,161 9.77

66,213 58% 2.00

65,840 30.60 5.4% 5.28

Europe-Africa Low Average High Industry 1 Company

D

Labor Statistics

Total Regular Compensation ($ / worker / year) Workforce Productivity (pairs / worker / year) Production Labor Cost ($ per pair after rejects) Supervisory Compensation ($ / supervisor / year)

Branded Production TQM/6-Sigma Spending Current ($/pair produced)

Cumulative ($000s)

Superior Materials Usage

Total Production Cost ($ per pair produced) Reject Rate

Percentage of New Production Equipment

Cost Per S/Q Star (total production cost per pair ÷ S/Q rating)

0% 21,871 3,693 5.23

38,215 10% 0.50

4,100 24.11 2.3% 3.45

60% 26,178 3,963 6.85

39,211 60% 2.94

13,932 33.99 4.9% 5.96

100% 29,694 4,179 7.67

40,524 100%

5.00 35,159 42.95 7.5% 9.27

44% 27,883 3,871 7.61

40,126 64% 2.00

35,159 28.67 5.5% 4.94

Asia-Pacific Low Average High Industry 1 Company

D

Labor Statistics

Total Regular Compensation ($ / worker / year) Workforce Productivity (pairs / worker / year) Production Labor Cost ($ per pair after rejects) Supervisory Compensation ($ / supervisor / year)

Branded Production TQM/6-Sigma Spending Current ($/pair produced)

Cumulative ($000s)

Superior Materials Usage

Total Production Cost ($ per pair produced) Reject Rate

Percentage of New Production Equipment

Cost Per S/Q Star (total production cost per pair ÷ S/Q rating)

11% 12,865 3,537 3.22

26,539 10% 0.30

32,102 18.78 1.7% 3.43

85% 17,193 4,000 4.45

27,370 47% 1.97

75,443 25.34 5.7% 4.45

100% 20,652 4,229 5.14

29,528 68% 5.00

224,500 32.24 9.9% 7.05

68% 20,652 4,177 4.95

27,590 60% 1.90

76,526 26.80 5.4% 4.62

Latin America Low Average High Industry 1 Company

D

Labor Statistics

Total Regular Compensation ($ / worker / year) Workforce Productivity (pairs / worker / year) Production Labor Cost ($ per pair after rejects) Supervisory Compensation ($ / supervisor / year)

Branded Production TQM/6-Sigma Spending Current ($/pair produced)

Cumulative ($000s)

Superior Materials Usage

Total Production Cost ($ per pair produced) Reject Rate

Percentage of New Production Equipment

Cost Per S/Q Star (total production cost per pair ÷ S/Q rating)

0% 12,738 3,538 3.12

26,539 0%

0.00 0

17.86 2.3% 3.29

79% 15,844 4,128 4.06

27,046 45% 1.98

20,712 26.88 6.7% 7.78

100% 20,987 5,975 4.93

28,154 66% 5.00

59,580 39.78

11.3% 29.77

40% 18,172 3,875 4.93

27,866 66% 2.00

37,449 25.78 5.6% 4.44

Note:  To protect individual companies from having competitively sensitive data revealed to rival companies, only the industry averages are reported for regions with 2 or 3 production facilities. Industry low and high numbers are reported only for regions with 4 or more production facilities. No benchmark data is reported for regions with only 1 production facility.

 

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Industry 1 PERFORMANCE BENCHMARKS Year 17 (concluded)  

Branded Operating Benchmarks

North America Low Average High Industry 1 Company

D

Internet Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Wholesale Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Distribution and Warehouse Costs ($ per pair available for sale) Cost of Branded Pairs Sold (production, freight, x-rate cost adjustment)

4.20 26.31 2.99 3.26

4.7% 2.36 4.81

9.2%

6.25 31.03 18.87 23.10

25.3% 11.11 12.02

18.6%

9.05 39.19 26.54 37.20

37.2% 17.67 36.33

40.4%

4.20 31.40 22.12 20.57

22.9% 14.16 11.67

18.2%

Europe-Africa Low Average High Industry 1 Company

D

Internet Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Wholesale Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Distribution and Warehouse Costs ($ per pair available for sale) Cost of Branded Pairs Sold (production, freight, x-rate cost adjustment)

5.06 28.66 2.82 9.14

11.0% 2.93 5.33

9.7%

10.26 32.95 18.04 27.93

29.1% 10.26 13.96

20.8%

13.02 40.35 27.19 42.22

41.8% 17.45 40.52

44.6%

5.06 29.66 18.85 26.65

29.4% 13.00 15.44

23.9%

Asia-Pacific Low Average High Industry 1 Company

D

Internet Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Wholesale Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Distribution and Warehouse Costs ($ per pair available for sale) Cost of Branded Pairs Sold (production, freight, x-rate cost adjustment)

3.07 23.55 3.42 2.92

3.5% 4.74 9.18

17.4%

6.53 26.71 20.09 26.38

29.2% 10.08 15.99

26.0%

11.34 33.24 32.85 42.87

42.7% 17.87 34.95

41.0%

3.07 26.24 22.79 23.77

26.3% 14.06 15.48

24.1%

Latin America Low Average High Industry 1 Company

D

Internet Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Wholesale Segment Marketing Expenses ($ per pair sold) Operating Profit ($ per pair sold) Operating Profit Margin

Distribution and Warehouse Costs ($ per pair available for sale) Cost of Branded Pairs Sold (production, freight, x-rate cost adjustment)

4.31 24.34 4.79

-5.42 -6.8%

2.99 -5.53

-11.0%

11.07 33.34 17.70 21.98

23.8% 9.42 9.00

14.0%

22.00 42.83 24.00 50.84

47.0% 17.60 34.31

42.2%

4.31 26.71 19.26 24.17

28.1% 13.24 14.48

23.7%

Private-Label Operating Benchmarks

Low Average High Industry 1 Company

D

North America Cost Per Pair Sold (production, freight, tariffs, x-rates)Margin Over Direct Cost ($ per pair sold) 27.68 +0.03

30.00 +8.38

33.69 +16.56

31.73 +9.27

Europe-Africa Cost Per Pair Sold (production, freight, tariffs, x-rates)Margin Over Direct Cost ($ per pair sold) 27.64 -1.19

33.13 +8.87

40.40 +18.87

29.23 +12.15

Asia-Pacific Cost Per Pair Sold (production, freight, tariffs, x-rates)Margin Over Direct Cost ($ per pair sold) 21.08 -5.42

26.26 +13.52

37.72 +21.88

24.31 +16.84

Latin America Cost Per Pair Sold (production, freight, tariffs, x-rates)Margin Over Direct Cost ($ per pair sold) 21.20 -5.06

25.93 +14.76

41.06 +22.68

25.03 +14.11

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Industry 1 CELEBRITY ENDORSEMENTS AND INDUSTRY TRENDS Year 17  

Celebrity Endorsements

Celebrity Year 18

Contract Holder No. of Offers

Highest Offer

2nd Highest

3rd Highest

Most Recent Contract Offers (letter in parens indicates company that made offer)

Judy Judge H Road Runner 3 12,001 (H) 5,000 (E) 3,339 (K) Kimmie Jimmel J-Doyen 5 16,000 (J) 14,900 (H) 14,001 (B) Bud Birkenstock G - Star 6 15,000 (A) 15,000 (G) 14,001 (B) Jose Montana H Road Runner 6 14,001 (B) 11,001 (H) 11,000 (A) Samuelle Jackson B Cielo 8 14,001 (B) 14,000 (J) 11,001 (H) Bronko Mars J-Doyen 9 16,000 (J) 14,001 (B) 11,001  (I) Steff Caraway B Cielo 6 14,001 (B) 11,001  (I) 10,500 (H) Jay XYZ G - Star 6 9,000 (G) 6,001 (C) 6,000 (J) Nunchuck Norris DTigers 6 13,000 (D) 10,000 (G) 9,501 (C) Roger Federation K ASM 5 11,000 (B) 7,779 (K) 7,000 (H) Nick Shavan H Road Runner 5 7,000 (H) 6,002 (C) 4,000 (D) Anderson Blooper J-Doyen 4 10,505 (J) 7,000 (H) 6,001  (I) Mic Jagermeister DTigers 5 13,000 (D) 9,501 (C) 9,001 (H) Jim Hardball J-Doyen 4 10,605 (J) 6,001  (I) 6,000 (H) LaBron Game B Cielo 7 15,025 (B) 14,000 (D) 10,001 (C)

Co. N.A. E-A A-P L.A. A 0 0 0 0 B 215 245 240 245 C 0 0 0 0 D 170 180 175 140 E 0 0 0 0 F 0 0 0 0 G 145 170 125 145 H 215 190 190 190 I 0 0 0 0 J 290 220 305 290 K 75 85 65 100

Avg. 101 99 100 101

Year 18 Consumer Appeal (sum of consumer appeal indexes for   each company in the upcoming year)

Pricing and S/Q Rating Trends

NORTH AMERICA EUROPE-AFRICA

ASIA-PACIFIC LATIN AMERICA

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