- 102 -
APPENDIX
Petitioners’ and Respondent’s Experts’ Common Measures of
Comparison Group Companies’ Profitability for TYE 1998
Dr. Hakala’s Measures
Gross Revenue Net Return on Return on
Revenue1 Growth2 Income3 Equity4 Assets5
Menards $3.420 12.7% $0.205 18.8% 14.2%
Home Depot 24.156 23.7 1.160 16.1 10.3
Kohl’s 3.060 28.1 0.141 14.8 8.7
Lowe’s 10.137 17.9 0.357 13.7 6.8
Staples 5.732 27.6 0.168 15.3 6.4
Target 27.757 9.4 0.751 16.7 5.3
Mr. Rowley’s Measures
Net Net Sales Net Return on Return on Return on
Sales6 Growth8 Income9 Avg. Equity10 Beg. Equity11 Avg. Assets12
Menards $3.420 12.7% $0.204 20.6% 22.9% 15.6%
Home
Depot 24.156 23.7 1.160 17.8 19.5 11.3
Kohl’s 3.060 28.1 0.141 19.2 27.3 10.3
Lowe’s 10.137 17.9 0.357 14.8 16.1 7.4
Staples 75.181 30.6 0.131 15.1 17.2 6.2
Target 27.757 9.4 0.751 19.6 20.7 5.5
1Gross revenue is total gross sales in billions, rounded to the nearest
million, before the subtraction of sales costs.
2Revenue growth is the percent change in gross revenue from the preceding
fiscal year.
3Net income in billions, rounded to the nearest million, was computed after
taxes. 4Return on equity equals net income divided by shareholders equity and
multiplied by 100 percent.
5Return on assets equals net income divided by total assets and multiplied by
100 percent.
6According to Menards’s financial statements, these numbers are actually gross
sales in billions, rounded to the nearest million.
7For the values of Staples’s gross revenue, revenue growth, and net income in
TYE 1998, a slight discrepancy existed between Mr. Rowley’s and Dr. Hakala’s expert
reports. Neither party explained the discrepancy.
8According to Menards’s financial statements, these numbers are actually gross
sales growth.
9Net income in billions, rounded to the nearest million, was computed after
taxes. 10Mr. Rowley did not explain how he arrived at these numbers for return on
average equity.
11Mr. Rowley did not explain how he arrived at these numbers for return on
beginning equity.
12Mr. Rowley did not explain how he arrived at these numbers for return on
average assets.
Page: Previous 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 Last modified: May 25, 2011