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April 21, 2004
Group #3
MWF 9:00
Beth Brown
Lanissa Lloyd
Laura Metzler
Jimmy Mitchell
Matthew Sanders
Daniel Travis
1
Table of Contents
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Executive Summary.........................3
Recommendation #1………….........5
Recommendation #2………….........9
End Notes………………………….12
Appendix 1………………………...13
Appendix 2………………………...16
Appendix 3………………………...17
Appendix 4………………………...18
Appendix 5………………………...19
Appendix 6………………………...20
Appendix 7………………………...21
Appendix 8………………………...22
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Executive Summary
Newell Rubbermaid is vying for a stronger position in the home care products industry.
It sells products world-wide under the segments of Cleaning and Organization, Office, Home
Fashion, Tools and Hardware, and a final category consisting of the rest of its products titled
“Other”. While best known for Rubbermaid, it has a niche in many other consumer products.
Newell’s outdated strategy of acquisitions remains a lingering problem. Newell began as
a corporation focused on buying small companies with strong brands, high costs, and poor
marketing strategies.1 Newell would then turn these companies around into lean profitable
segments. However, when Newell bought Rubbermaid and business strategies clashed, these
acquisitions turned unprofitable as Newell could not integrate these segments into a core
competency. Rubbermaid could not be restructured in a manner similar to previous buyouts. It
had low margin products and high costs and so Newell foundered.
Newell purchased companies just for the thrill of a new acquisition, and mistakes were
glossed over.1 With large amounts of cash flow, managers began acquiring companies without
much thought or consideration, as these projects proved to be negative NPV investments.
Newell lacked a long term focus, and concentrated solely on sales growth, operating income,
cash flow, and EPS.2 The result of these poor acquisitions ended with many unprofitable deals
and an eroded stockholder confidence.
Newell Rubbermaid began restructuring three years ago. The company started to divest
products that did not fit into its long term strategic objective and looked for low margin products
to discontinue. Newell also boosted its Research and Development (R&D) in the past three years
from $67.2 million to $124.6 million. The firm is cutting costs by exiting US manufacturing
sites, reducing the number of employees, and globalizing operations. Additionally, Newell
reduced inventory and expenses by creating stronger supplier relationships. In 2003, Newell
split the company into two divisions, Rubbermaid/Irwin and Sharpie/Calphalon. Newell created
a Chief Operating Officer (COO) position for each division with the intention of improving
organizational management.
Newell Rubbermaid already has a strong niche in its tools and office supplies divisions.
It can capitalize on this strength by creating projects that add value to the brand name. However,
Newell must avoid uninformed acquisitions that don’t add value to the firm and discontinue low
margin products that no longer generate profits.
We have two recommendations for Newell in its restructuring process. First, we suggest
that Newell continue to mature its core competency of “product development, brand
enhancement, and selective globalization”.3 Instead of purchasing companies with its free cash
flow, Newell can invest in R&D and increase the brand quality and expand the customer loyalty
that currently exists. This allows the company to get leaner and reduce unnecessary costs while
increasing sales. When Newell realizes higher profit margins, its net income will increase. Our
second recommendation is for Newell to implement an incentive plan that ties management and
executives closer to the performance of the company. Increasing managers’ stake in the firm
will cause them to weigh their decisions more carefully, since they will be held liable for
failures. However, any action that adds value will be magnified in their bonuses through an
increase in the value of their equity.
3
Proposal
Newell Rubbermaid is the sixth largest company in the Household and Consumer
Products Industry. While it has a potential for growth, its current financial health suffers as
evidenced in its negative net income in 2003 of $46.6 million.4 Inhibiting Newell’s growth is a
host of well-established competitors like Proctor & Gamble, Gillette, and Avon. Because these
firms mass merchandise and become multi-divisional, Newell has been unable to realize high
profits over the years.5 There is no room for waste and errors, so Newell must restructure itself
to meet these pressing changes.
The problems that Newell faces are not new. Newell is now realizing the result of some
bad decisions that have taken a few years to come to light. By acquiring too many companies
too fast; essentially, Newell bit off more than it could chew. As a result, Newell posted a loss in
net income of $46.6 and $203.4 million in 2003 and 2002 respectively. This loss can be
attributed to high impairment and restructuring charges, as well as reduced sales margins.
Newell did report an increase of 4% in sales from $7,453.9 million in 2002 to $7,750 million in
2003, however, its operating income fell from $629.7 million to $179.9 million, a 71% decrease.5
Newell needs to focus on increasing their profit margins to industry standards, if they are going
to continuing competing as a company (Appendix 7).
Newell’s focus on short term goals is detrimental to the growth of the firm. Its strategy
of spending capital, buying other companies, and hoping for a quick profit boost is not reliable.
This strategy inflated its assets and reduced its returns, causing a weak return on assets (ROA).
Instead, it should invest cash in long term NPV projects that add value. Newell must focus on
such performance measures because “Unlike Rubbermaid, privately held companies like Sterilite
Corp. don’t need to focus on strong earnings results every quarter...” 6
4
Another major problem affecting Newell Rubbermaid is the decrease in stock value from
the viewpoint of stockholders and analysts. The company’s performance over the past several
years has not been well as reflected by the stock price. While industry growth increased during
2003, Newell’s growth declined by approximately 22%. Stocks peaked at approximately $52
before the Rubbermaid acquisition in 1999. The stock closed at $24.10, as of April 20, 2004. In
order to increase the value of its stock, Newell must show its commitment to change through
specific actions and not just words.
Recommendation 1
The first recommendation we propose is to focus on a core competency. The three main
strategies that need integration into its core competency are focusing on internal growth,
continuing to increase funds toward R&D, and offering a PPO for certain segments of its
company.
In 2003, Newell announced that it is going to emphasize building its current brands.
However, the company’s annual report states that “The Company’s growth strategy emphasizes
internal growth and acquisitions.”5 Newell must focus solely on internal growth and stabilizing
its current position instead of looking for acquisitions. Executing this strategy will help Newell
emerge with a stronger capital structure. Newell’s debt rose from $107.5 to $242.2 to $460
million in 2001, 2002, and 2003, respectively, due to the acquisitions of highly leveraged
companies. 5 Under this strategy, Newell will no longer acquire companies with high debt. One
downside is passing up an acquisition with a positive NPV. However, in its current state of
restructuring and focusing on strengthening brand recognition, this should not be a source of
concern for Newell. There is an opportunity cost by passing up positive NPV acquisitions, but it
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is crucial that it establishes and builds on what it has before seeking external projects. Cash flow
spent on acquisitions should instead be invested on building its current brands to increase the
value of its products and trademark. As a result, Newell reduces wasted funds and increases
value and revenues.
One way to achieve internal growth is to increase R&D. Over the past three years, R&D
has increased from $67.2 million to $124.6 million. Proctor and Gamble, the leader in the
industry, spends roughly 3% of its revenues on R&D. While this is not a benchmark, it is an
indicator that Newell can improve in this area since it only allocates about 1% of revenues
(Appendix 6). Reviewing Scott Company’s restructuring, George Baker describes how cutting
back capital spending would increase short term value but burn the company later. He proves his
point, highlighting how management “resisted short term cutbacks in productive capital spending
at Scott. In fact, as shown in Table 1 (Appendix 5), capital spending, R&D, and marketing and
promotional expenses all increased.”7 This along with a management incentive helped to create
long term value which is essential for survival. If Newell is going to survive, it needs to focus on
the long term, and R&D is an element of this.
A potential downside of R&D spending is that there could be no real payoff in terms of
development. However, every firm takes the risk of a potential loss on R&D, as it is a cost of
doing business. Newell can implement controls, such as testing, to terminate unsuccessful
research. These controls reduce wasted resources and keep the focus on consumer needs.
Another downside concerns Newell’s competitors replicating its products at lower costs.6 If
Newell’s customers can get the same products for less, its customer loyalty has the potential to
fade. However, in the early 90’s, Rubbermaid was a successful company because its product
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carried strong brand value that consumers trusted in.8 For Newell to maintain this consumer
loyalty, quality must be continually proven to overcome its competitors’ prices.
Part of Newell’s restructuring and divesting strategy is focusing on enhancing its current
product lines through exiting low margin products and increasing spending on R&D. Although
it is divesting low margin products, there is still a heavy emphasis on the Rubbermaid division.
Newell’s website states that Rubbermaid is “positioned as a market leader in new product
development.” As Newell’s largest division, accounting for 26% of revenues, Rubbermaid only
accounts for 12% of operating income before restructuring and impairment charges. To align
Newell’s new core competency with Rubbermaid’s performance, we recommend that Newell
find a better way to allocate its capital and ensure that divisions with higher margins are given
the funds necessary to continue their growth. We propose that Newell offer a partial public
offering (PPO) of two of its more profitable segments, which “…assure[s] more financial
liquidity and flexibility going forward.”9 A PPO allows the purpose of a division to become
clearer and eliminate some agency conflict. The shareholders also benefit from more detailed
financial statements on the division through SEC regulations and stronger analyst coverage. This
gives the stockholders a more direct measure of performance. A PPO also allows employees to
have a more distinct role in the division and a greater feel for progress.7 Since the Tools and
Office divisions are doing well, contributing 24.1% and 41.6% of operating income before
restructuring and impairment charges, respectively, we propose that a PPO be offered for these
divisions. This will ensure a better allocation of capital, which in turn will increase the value of
Newell’s stock. Finance professors at Pennsylvania State University have researched these
PPO’s or “carve outs” since the 1980’s. After studying roughly ninety of these, they concluded,
“The parent firms themselves exhibited improved measures of operating efficiency, such as
7
improved return on assets and return on sales.”9 These measures do not just stem from the
announcement itself, but more from the parent companies being less involved in controlling
operations.
One problem with offering a PPO is that it might appear as merely “… moving chairs
around, but not really adding value,” which eventually causes it to fail.9 However, Newell’s
reasons for its offering are related to potential for improvement. By ensuring that high profit
margin divisions are receiving cash flows, the divisions will be more autonomous and be allowed
to expand on what they are already doing well. Another reason why the PPO may fail is a lack
of investor confidence in the business prospects of the division, as was the case of Merck’s
Medco Health Solutions unit.10 However, based on the Tool and Office division’s contribution
to operating income, Newell should have no problem attracting investors with its potential for
growth.
Focusing its core competency on producing stronger products, increasing R&D, and
offering a PPO will allow Newell the opportunity to lay a solid foundation and develop the
strength of its assets. This will require some changes in its capital spending as it shifts from
external acquisitions to internal product development. As a result, the ROA should increase
rather than fall, as it has over the past couple of years.
Recommendation #2
Our second recommendation is to create an incentive program that ties management
bonuses closer to the performance of the company. As mentioned before, acquisitions were
made just for the thrill. Managers were not being held responsible for their actions, and this led
to mistakes being overlooked.1 CEO Joseph Galli has already taught several training programs
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to the top 300 executives about promoting brands and developing products. 1 However,
managers need more fire to their feet if they are expected to turn Newell around and put out
profits for the shareholders. Interestingly, at Proctor and Gamble, the leader in the industry,
employees are trained to focus on their “fiduciary responsibility to shareholders” (Appendix 6).
It would not hurt Newell Rubbermaid to do likewise with its employees. However, one of the
most effective ways to hold the managers responsible to the shareholders is to turn them into
shareholders.
Currently, the CEO and executives are compensated in four ways: base salary, annual
incentive compensation, stock options and other equity based awards, and supplemental
retirement benefits.2 Under the annual Incentive Compensation, payments are based on “a
combination of sales growth, operating income, cash flow and earnings per share”. 2 Essentially,
this encourages a focus on the short term. Managers wanted to boost their salaries, so they made
outlandish acquisitions, hoping to turn them profitable. Unfortunately, this strategy crippled
Newell’s financial health, causing it to incur significant restructuring charges and losses.
Additionally, if one division does poorly, but the company is rewarded as a whole for doing well,
then this division will never learn from its mistakes. Related to this, G. Bennett Stewart says,
“Managers of high-return businesses who consistently employ much of the cash thrown off by
those businesses in other ventures with low returns should be held to account for those allocation
decisions, regardless of how profitable the overall enterprise is.”7
Therefore, the company should do away with cash bonuses and increase the amount of
equity that each manager receives. It will be in the form of a restricted stock to prevent them
from cashing out immediately. Stewart emphasizes, “Most performance measures, for example,
capture the results of a single period, while stock prices capitalize the value of good management
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decisions over the life of the business.” 7 Binding management to the firm changes its motivation
to seek long term success. Since managers have higher stakes in the company, they weigh their
options more carefully.
The downside to this is that managers might cash out as soon as the restrictive covenant
is up. Also, they may want to leave if most of their salary comes in the form of equity instead of
cash. However, we believe that Newell will not be affected by these issues. Galli is passionate
about turning the company around. His energy should inspire others to accept this change. Also,
if managers do not support this strategy, they send a negative message about their current belief
in the value of the firm. If they don’t believe the company can be turned around, Newell should
seek new management. Secondly, although management may risk higher losses, there also exists
an opportunity for greater returns. Over the past three years, only the CEO and one other
executive officer’s salaries were over one million dollars. However, ownership in equity can
increase management’s gains exponentially. Furthermore, when managers take equity-based
compensation, it sends a strong signal to the market that management stands behind its company.
The determination of bonus size is important, because it needs to be awarded on a
decentralized level, not only on the results of the company. 7 Scott Company instituted a bonus
payoff structure based on three areas: the corporation, the division, and the manager’s individual
performance goals. Following Scott’s example, we recommend that bonuses be awarded 40% on
divisional performance, 35% on company performance, and 25% on individual performance.
Concerning the executives, Scott split the ratio equally between the company’s performance and
managers’ individual performance goals. 7
One downside of divisional bonuses is that competition between divisions becomes so
fierce that it results in internal strife. However, our recommendation overcomes this problem,
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since the company’s overall health is taken into strong consideration when determining the
bonus amount. Healthy competition can keep Newell responsive to the industry, while
rewarding each division for their individual success.
In order to measure company performance, we recommend that Newell implement an
Economic Value Added (EVA) system. Newell uses short term measures based on operating
income and increased sales to award bonuses. However, EVA is a better measure of
performance since it charges interest on any net spending shifted into the future. Newell’s EVA
for 2003 was -$384.3 million (Appendix 8). Executives will feel a heavier loss in bonuses
compared to managers, but it will give them a greater incentive to increase performance. The
split bonus system benefits managers by rewarding them to meet their personal goals.
In the past, Newell’s managers have wasted cash flow and indulged in the thrill of
acquisitions. 1 Through our recommendations of a focused core competency and a change in
management incentives, Newell Rubbermaid will become a company with a focused vision that
will lead to long term financial health and growth.
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End Notes
1. Deutsch, Claudia. “After Buying Rubbermaid, A Deluge of Sorts.” The New York
Times. March 20, 2004.
2. Newell Rubbermaid Inc. 2004 Annual Meeting Proxy Statement. 31, Dec. 2003.
<“http://www.newellrubbermaid.com/newellco/downloads/2004form8kproxy2003.pdf”>
3. http://www.newellco.com
4. http://www.morningstar.com
5. Newell Rubbermaid Inc. Form 10-K. 31, Dec. 2003.
<“http://www.newellrubbermaid.com/newellco/downloads/2003form10k.pdf”>
6. “Viewpoint.” Plastics News. January 12, 2004.
7. Chew, Donald H. The New Corporate Finance. St. Louis:McGraw-Hill Companies,
Inc, 2001.
8. Case Study:Rubbermaid <http://www.itpe.com/businessandmanagement/thompson4
/knowmore/i_01rubbermaid.htm>
9. Scism, Leslie. “Can Carve-Out Strategy Pay Long-Term?” Wall Street Journal. July 2,
1998.
10. Roman, Monica. “It’s No Go For Merck’s IPO.” Business Week. New York: May 5,
2003. Iss. 3831; pg.42
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Appendix 1
Overview
Newell Rubbermaid is a publicly-held company incorporated in 1970. The company,
headquartered in Atlanta, Georgia, operates production facilities throughout the world that create
homeowner products. Management recently centered itself on passion for its customers and
employees. The company seeks to develop a strong customer focus by creating breakthrough
products that better the lives of its customers and create a corporate culture of strong leadership
and teamwork.
Employees
Newell Rubbermaid’s workforce of 40,000 plus perform services in sales, finance/accounting,
and product development. 3 Jobs in the sales department include human resources, marketing,
customer service and the Phoenix Program. Newell Rubbermaid started the Phoenix Program to
train employees in retail market management. The finance and accounting department include
positions in auditing, cost analysis and corporate financial planning. The product development
department includes supply chain management, engineering, and design positions. In order to
stop the plummeting of Newell’s stock value, the board of directors elected Joseph Galli as CEO
of the corporation in 2001.
Facilities
Newell Rubbermaid operates manufacturing facilities around the world for each of its business
segments. In 2001, Newell implemented a plan to consolidate manufacturing facilities with
excess capacity and move factories overseas in an effort to reduce costs. Since 2001, Newell
closed 78 plants throughout the United States and Europe in this consolidation effort. 3 Newell
Rubbermaid’s most current plant closing is the Wooster, Ohio facility, former headquarters of
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Rubbermaid Inc. Newell closed the facility due to a discontinuation of 70% of the products
currently being produced on site.1
Products
Newell Rubbermaid manufactures an array of consumer products and globally markets these
products through a variety of wholesale and retail outlets. The corporation recently segmented
the products into five core sections to include: Cleaning and Organization, Office Products,
Tools and Hardware, Home Fashion, and a segment marked as “Other”. The cleaning and
organization division consists of the brand names Rubbermaid, Stain Shield, TakeAlongs,
Roughneck, and Brute. 3 The division of Office Products includes pen, pencil, and paper
products under the brand names Sharpie, Waterman, Paper Mate, Colorific, Eldon, and Parker.
Painting supplies, hand and power tools, and other garage machinery are branded under Lenox,
VISE-GRIP, Marathon, IRWIN, Shur-Line, BernzOmatic, and Quick-Grip and are segmented
into the Tools and Hardware division. The Home Fashion segment includes window blinds and
drapes branded under the popular European names of Levolor, Kirsch, Gardinia, and Swish.
Newell Rubbermaid’s final segment includes a variety of miscellaneous products from toys, high
chairs, strollers, car seats, cookware, glassware, and hair care accessories. The segment known as
“Other” includes these products under the brand names of Calphalon, WearEver, Graco, Little
Tikes, and Goody. 3
Competitive Environment
Newell Rubbermaid’s strongest competitor is the highly profitable Proctor & Gamble. In a recent
comparison, Newell scored a B in growth and a C in profitability and financial well-being while
Proctor and Gamble received an A in each of the three categories (Appendix 2). While Newell
14
hovers around the industry average for the three categories, Proctor and Gamble excels. Proctor
and Gamble’s significant investment in Research and Development, at $1,665 million, compared
to Newell’s $124 million, allows for P&G’s growth and strong financial records (Appendix 3
and 4). On a segment basis, Newell Rubbermaid’s competitors differ in each division. Key
segmented competitors include Hunter Douglas N.V. in the Home Fashions division, Avery
Dennison in the Office Products division, and WKI Holding Company, Inc. and Tupperware in
the “Other” division. Hunter Douglas N.V. sells blinds, curtains, and sunscreens under the
Luminette, Silhouette, Luxaflex, and Duette brands. Avery Dennison produces adhesive labels
and office products including Marks-A-Lot and HI-LITER. Avery’s most widely used product is
the self-adhesive stamp created for the U.S. Postal Service. The WKI Holding Company
manufactures highly recognized brand name kitchenware including Corelle, CorningWare,
Pyrex, and Revere. WKI competes with Newell by selling its products through mass merchants,
specialty retailers, and factory outlet stores.10
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Appendix 2
Taken from morningstar.com
Stock
ProfitGrowth ability
Financial
Health
7,671
B
C
C
10,263
4,327
C+
B-
C+
137,020
46,992
A
A
A
B-
A
B+
B
A
A-
Mkt Cap $Mil
Sales $Mil
6,673.0
Newell Rubbermaid
Industry Average
Procter & Gamble
Gillette
38,709
9,159
Kimberly-Clark
32,258
14,348
Colgate-Palmolive
30,252
9,751
B-
A+
B-
Avon Products
18,696
6,621
B+
A+
A-
Clorox
11,104
4,166
C
A
B+
Fortune Brands
10,940
5,990
B-
C-
C
Estee Lauder A
10,045
5,440
A-
A-
A-
L'Oreal ADR
5,341
11,507
C+
A-
A
Swedish Match ADR
4,578
1,032
C+
A
C
Alberto-Culver
4,185
2,959
A
A-
A
Energizer Holdings
3,859
2,472
A
B
B-
Tupperware
1,130
1,204
C
A
B-
Rayovac
966
1,116
A+
C+
D
Elizabeth Arden
515
770
A-
C-
D
Inter Parfums
469
173
A
B+
B-
Playtex Products
441
670
D
C+
C-
Del Laboratories
305
373
B+
B-
C-
Revlon
212
1,143
D
F
F
Water Pik Technologies
207
293
C
B
D+
Industry Average is equal-weighted.
Mkt Cap as of 04-19-04.
Sales TTM through most recent quarter-end.
Grades through 04-14-04.
16
Appendix 3
Procter and Gamble 2003 Financials (10 k)
17
Appendix 4
Newell Rubbermaid 2003 Annual report (10k Pg. A-32)
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Appendix 5
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Appendix 6
The Procter & Gamble Company and Subsidiaries 35
CONSOLIDATED STATEMENTS OF EARNINGS
<TABLE>
<CAPTION>
Years
Ended June 30
--------------------------------Amounts in millions except per share amounts
2003
2002
2001
-------------------------------------------------------------------------------------------------<S>
<C>
<C>
<C>
Net Sales
$ 43,377 $ 40,238 $ 39,244
------------------------------------------------------------------------------------------------------------------46 The Procter & Gamble Company and Subsidiaries
CONSOLIDATED FINANCIAL STATEMENTS
</TABLE>
NOTES TO
Selected Operating Expenses
Research and development costs are charged to earnings as incurred and were
$1,665 in 2003, $1,601 in 2002 and $1,769 in 2001. Advertising costs are
charged
to earnings as incurred and were $4,373 in 2003, $3,773 in 2002 and $3,612 in
2001. Both of these are components of marketing, research, administrative and
other expense.
--------------------------------------------------------------------------------------------------------------------Our Calculation: $1,665 / $43,377 = 3.83% (Ration of Proctor and Gambles R&D/Net Sales)
----------------------------------------------------------------------------------------------------------------------------- ---------------
Proctor and Gambles effort to focus on shareholders
Focusing on financial stewardship. We maintain a specific program to ensure
that employees understand their fiduciary responsibilities to shareholders.
This ongoing effort encompasses financial discipline in our strategic and
daily business decisions and brings particular focus to maintaining accurate
financial reporting through process improvement, skill development and
oversight.
<PAGE>
The Procter & Gamble Company and Subsidiaries 23
20
Appendix 7
Profitability more
12-31-02
Stock
Industry
S&P 500
ROA %
3.3
11.7
5.7
ROE %
11.2
34.8
16.7
Net Margin %
3.4
11.7
11.4
Asset Turnover
1.0
1.0
0.7
Fin Leverage
Sales/Employee
$Thousands
3.4
5.1
5.8
163.2 ---
---
Stock uses trailing 12 months. Industry and S&P 500
use fiscal year-end.
21
Appendix 8
Basic EVA 2003
I. NOPAT = NI + Interest Expense
$(46.6) + $140.1 =
$93.5
II. Capitalt-1 = Assets – NIBCLS
$7,404.4 – (686.6 + 153.5 + 1,165.4 + 159.7)
$7,404.4 – 2165.2 =
$5239.2
III. Cost of Capital
Cost of Equity = rf + B(rf)
5.4% + (.9)6% =
10.8%
Total Debt = Short Term + Long Term
$424 + $2,372.1 =
$2,796.1
Average rate on Debt =
($ 424 / $2,796.1)(5.9%) + ( $2,372.1 / $2,796.1)(6.21%) =
6.16%
After Tax Cost of Debt =
6.16%(1-.35) =
4%
A. Equity
Market Value of Outstanding Shares =
$30.33(283.1) =
$8,586.42
Total Equity = Market Value + Minority Interest
$8,586.42 + 1.3 =
$8,587.723
B. Debt
From earlier calculation
$2,796.1
C. Market Weights
Total Equity and Debt = Market Equity + Debt
$2,796.1 + $8,587.23 =
$11,383.82
Weight of Equity
($8,587.23 / $11,383.82) = .75433
Weight of Debt
($2,796.1 / $11,383.82) =
.24562
Cost of Capital
kt-1 = Cost of Equity (Weight of Equity) + Cost of Debt (Weight of Debt)
10.8% (.754336) + 4% (.24562) = 9.13%
EVA = NOPAT – (kt-1)*Capitalt-1
$93.5 – (9.13%)*$5,239.2
$93.5 – $478.33 =
$(384.83)
MVA = Market Value – Capital
$11,383.82 - $5,239.2 =
$6,144.62
22