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AUDIT PRESENTATION BY KPMG Tootsie Roll Industries.

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Presentation on theme: "AUDIT PRESENTATION BY KPMG Tootsie Roll Industries."— Presentation transcript:

1 AUDIT PRESENTATION BY KPMG Tootsie Roll Industries

2 TOOTSIE ROLL REVIEW OF FINANCIAL STATEMENTS OVERALL EVALUATION THE FUTURE KPMG & TOOTSIE CONCLUSION / QUESTIONS Table of Contents:

3 Your Company Favorite candy company Most popular confectionary brands Distribution channels – 75 countries Strong among every age group, culture, demographic During every economic climate – truly enduring Family-run corporate culture

4 Continued… Fiscally responsible focus – “America’s 200 Best Small Companies” by Forbes Magazine Highest ethical business standards – “100 Best Corporate Citizens” by Business Ethics Magazine Focus on high profitability Emphasis on ethics and integrity Involvement with the community and national concerns

5 Income Statement Total Revenue increased over $22 million Net Income decreased $164,000 EPS increased from.93 in 2009 to.94 in 2010 Profit margin decreased from 10.87% in 2009 to 10.39% in 2010 Gross profit margin decreased from 36.29% in 2009 to 33.27% in 2010 Times interest earned increased from in 2009 to in 2010

6 Why did Net Income Decrease? Net earnings benefited from increased sales Cost of Goods Sold increased almost $30 million  Cost of sugar and cocoa increase Provision for income taxes increased over $10 million

7 Retained Earnings Retained Earnings at beginning of year148,582145,123 Net Earnings53,71453,878 Cash Dividends(18,078)(17,790) Stock Dividends(46,806)(32,629) Retained Earnings at the end of year$137,412$148,582 Earnings per share$0.94$0.93 Average Common and Class B Common shares 56,99757,738 Outstanding : 2009: Dividends paid for the year $64,884 $50,419 Percent of net income paid out of cash 33.67% 33.02% dividends $0.32 of cash dividends paid out to stockholders in both years Paid out cash dividends 86 years in a row

8 Balance Sheet Working Capital Current Ratio Acid-Test Ratio Debt to Equity Ratio 2010 $179, % , %

9 Major Changes Cash and cash equivalents increased almost $25 million Added over $10 million in machinery and equipment Liability for uncertain tax positions decreased almost $10 million Capital in excess of par value increased over $23 million

10 Cash Flows Increase in net cash: Operating activities $82, compared to $76,994 – 2009  Net earnings benefited from increased sales  No gain because of increased costs Investing activities - capital expenditures of $12,813  Showing continual reinvestment  Plant, equipment, and information technology  Not as must sale and maturity of securities From financing activities - paid cash dividends of $18,130 and purchased and retired $22,881 of its outstanding shares  Treasury stock  Able to do more of both Cash increased because of increased sales (operating activities):  Reached new groups of customers  New marketing plans  Great Halloween season

11 Our Overall Evaluation Net product sales in 2010 reached $517 million  A record for the Company  Increase of $22 million over 2009 net product sales  Equals about 4.3% Another strong Halloween selling season Overall financial position remains very strong-  Net product sales  Net earnings  Related cash flows provided by operating activities Cash flows from operations plus maturities of short-term investments - adequate to meet the Company’s overall financing needs in 2011

12 Tootsie’s Future Key competitive advantage-  Well-known brands  High volume for Retailers  Attractive value for customers Entry into digital marketing = new opportunities Kosher certified open new markets Increase efficiency & eliminate waste Cash and stock dividends – 86 years in a row

13 About KPMG U.S. Audit, Tax, and Advisory services firm Purpose – turn knowledge into value for our clients Comply with changing regulations and professional standards Proactive coordination and communication – Chicago office Provide our teams’ well-built understanding 23,000 employees strong / 144 countries Risk-based, industry specific, and tailored to our clients Give you an edge to competitors

14 Any Questions?


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