Contents Page Introduction 5 Operational Costs & Profit/Loss 7 Detail of Expenses & Profit/Loss for 2007 9 Operating Ratio Analysis 13 Operational Costs by Company Sales 19 Profit/Loss History 1985 through 2007 25 Two-Year Comparisons 2007 vs. 2006 27 Type of Manufacturer: Stamping vs. Non-Stamping 2007 vs. 2006 31 Metal Stamping Companies: Profit vs. Loss - Expenses 35 Metal Stamping Companies: Profit vs. Loss - Operating Ratios 38 Non-Stamping Companies: Profit vs. Loss - Expenses 39 Non-Stamping Companies: Profit vs. Loss - Operating Ratios 42 Automotive/Non-Automotive: 2007 vs. 2006 43 Automotive: Profit vs. Loss - Expenses 47 Automotive: Profit vs. Loss - Operating Ratios 50 Non-Automotive: Profit vs. Loss - Expenses 51 Non-Automotive: Profit vs. Loss - Operating Ratios 54 More Valuable Business Reports 55 Order Form 57 Addendum Business Analysis Sample Survey 1
Operational Costs and Profit/Loss Average profitability of responding companies was X.XX% before taxes in 2007, including interest expense. The table on page 11 notes that interest costs averaged X.XX% as a percent of sales, so average Earnings Before Interest and Taxes (EBIT) was X.XX% for the metalforming industry in 2007. The XX% of responding companies that reported they were profitable in 2007 averaged profits of X.XX% with average interest expense of X.XX%, or EBIT of X.XX%. Companies with losses averaged X.XX% with interest expense of X.XX%, or EBIT of X.XX%. Companies with All Companies Companies with Losses 2
Operational Costs & Profit/Loss (cont d) All respondents were separated into three groups based on profitability: least profitable (lowest 25%), moderately profitable (middle 50%) and most profitable (highest 25%). Cost breakdowns and profitability were analyzed for each group. These pie charts summarize performance of low, middle and high profit companies and how they differ in terms of cost of sales, sales expense, G&A, other expenses and profit or loss before taxes. Middle 50% Performers Low 25% Performers High 25% Performers 3
Detail of Expenses & Profit/Loss for 2007 Cost of Sales # of Companies All Companies (Average) Averages for Companies with: Losses Low 25% Averages for Companies with: Middle 50% High 25% Materials Services (Outside) Manufacturing Labor Supervision & Factory Office Fringe Expenses Factory Supplies Utilities Maintenance Occupancy Costs Equipment Rental Shipping Excluding Labor Insurance Miscellaneous Factory Expenses Depreciation Subtotal of Cost of Sales 4
Detail of Expenses & Profit/Loss for 2007 (cont d) A total of XX,XXX employees were employed by participating companies in 2007. Of these employees, XX,XXX (XX%) worked for profitable companies while X,XXX (XX%) employees worked for companies that experienced losses in 2007. This compares to a total of XX,XXX employees in 2006, of which XX,XXX (XX%) worked for profitable companies and X,XXX (XX%) for companies with losses. General & Administrative Expenses # of Companies All Companies (Average) Averages for Companies with: Losses Low 25% Averages for Companies with: Middle 50% High 25% Office Salaries Fringe Expenses Office Office Operation Professional Services Taxes & Licenses Dues, Subscript., Donations Officer Salaries / Executive Comp. Miscellaneous General & Admin. Subtotal of General & Admin. Expenses 5
Detail of Expenses & Profit/Loss for 2007 (cont d) Sales Expenses # of Companies All Companies (Average) Averages for Companies with: Losses Low 25% Averages for Companies with: Middle 50% High 25% Sales Salaries Fringe Expenses Sales Advertising Miscellaneous Subtotal of Sales Expenses Other Expenses Interest Expense Bad Debts Charged Off Subtotal Total Costs Profit & Loss Profit... as % of Sales Loss... as % of Sales Profit or Loss... as % of Sales 6
Operating Ratio Analysis Capital investment decreased in the last year after increasing in two previous years. In 2007, the average investment ratio of all participating companies was X.XX% of sales, down from X.XX% in 2006. This is Percent of Sales Capital Investment for Fiscal Year the lowest reported average in more than 20 years. The average for profitable companies was X.XX%, while companies with losses invested an average of X.XX% All Companies Companies with Companies with Losses Lowest 25% Middle 50% Highest 25% of sales. Top-performing companies invested an average X.XX% of sales. Companies in the lowest quartile of Capital Investment History for All Companies profitability averaged X.XX%. The table on page 19 includes detailed analysis for various groups of companies. Percentage of Sales 2007 2006 2005 2004 2003 Year 7
Operating Ratio Analysis (cont d) Return on Assets Average return on assets (ROA) for all companies was XX.XX% in 2007, higher than 2006. In 2007, the most profitable 25% companies reported an average ROA of XX.XX%, while unprofitable companies All Companies Companies with Companies with Losses Lowest 25% Middle 50% Highest 25% (lowest 25% companies) reported negative ROA, averaging -X.XX%. The table on page 19 includes detailed analysis for various groups of companies. Return on Assets History for All Companies 2007 2006 2005 2004 2003 Year 8
Operating Ratio Analysis (cont d) Current Ratio The average current ratio for all companies was X.XX in 2007, a slight decrease from last year. The most profitable 25% of 2007 companies reported an average current ratio of X.XX, while All Companies Companies with Companies with Losses Lowest 25% Middle 50% Highest 25% unprofitable companies (the lowest 25% of 2007 companies), reported a current ratio of X.XX. Current Ratio History for All Companies The table on page 19 includes detailed analysis for various groups of companies. 2007 2006 2005 2004 2003 Year 9
Operating Ratio Analysis (cont d) Debt-to-Equity Ratio The average debt-to-equity ratio for all companies was X.XX in 2007. The most profitable 25% of 2007 companies reported an average debt-to-equity ratio of X.XX, while unprofitable companies (the lowest 25%) reported an average of X.XX debt-to-equity ratio. The table on page 19 includes detailed analysis for various groups of companies. All Companies Companies with Companies with Losses Debt-to-Equity Ratio History for All Companies Lowest 25% Middle 50% Highest 25% 2007 2006 2005 2004 2003 Year 10
Operating Ratio Analysis (cont d) As would be expected, there is a significant correlation between higher sales/employee ($XXX,XXX) and value added/employee ($XXX,XXX) and higher profitability. Profit or Loss Before Income Taxes # of Companies All Companies (Average) Averages for Companies with: Losses Low 25% Averages for Companies with: Middle 50% High 25% Employee Information Average Sales Per Employee Value Added Per Employee Other Items Accounts Rec. as % of Sales Capital Investment for Fiscal Year Return on Assets Current Ratio Debt-to-Equity Ratio 11
Operational Costs by Company Sales Comparisons based on company annual sales offer additional opportunity for comparison between companies. Companies with more than $50 million in sales were the most profitable, on average, in 2007 at X.XX%. This was followed by the $5 to $10 million companies with an average of X.XX% profit. Percentage of Sales Profit Before Taxes Other Expenses Gen'l & Admin Sales Expenses Cost of Sales All Participants Less than $5 Million $5 - $10 Million $10 - $20 Million $20 - $50 Million More than $50 Million 98 companies 11 companies 12 companies 25 companies 32 companies 18 companies 12
Profit/Loss History 1985 through 2007 This table tracks the percentage of participating companies with profits vs. losses from 1985 through 2007. Due to the severe manufacturing recession in 2001, XX% of companies experienced losses, the highest percentage in the history of the PMA Report, followed by 2003 when XX% of companies experienced losses. The percentage of companies that experienced losses moderated somewhat in 2002 to XX%, but that was the third highest level, matched by XX% with losses in 1985. The last two years were the best years for profits since 1992-1997 period. 100% Percentage of Profit and Loss 80% 60% 40% Loss Profit 20% 0% 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Years 13