This PPT slide, part of the 53-slide Shareholder Value Analysis PowerPoint presentation, presents a detailed analysis of ABC Credit's working capital structure, emphasizing the role of net receivables in driving a high working capital ratio. The "Working Capital Tree" visually breaks down various components of working capital relative to revenue, comparing ABC Credit (represented by Ford) against its peers over a three-year period (1999, 2000, 2001).

Key metrics are displayed in a tabular format, showing the percentage of operational current assets to revenue. Notably, net receivables consistently account for a significant portion of revenue, with figures reaching 92.2% in 1999 and averaging 90.7% across the years. This highlights a strong reliance on receivables for generating revenue, which could indicate effective credit management or potential risks if collections are delayed.

The slide also includes comparative data for cash and equivalents, inventory, and other current assets, providing a comprehensive view of how ABC Credit stacks up against its peers. For instance, while net receivables show a robust performance, other metrics like inventory and cash equivalents reveal a more mixed performance, with inventory ratios lagging behind peers.

The analysis suggests that while ABC Credit's net receivables are a strong driver of its working capital efficiency, the overall picture is nuanced. Stakeholders should consider both the strengths and potential vulnerabilities in the receivables management strategy. Understanding these dynamics is crucial for making informed decisions regarding investment or operational adjustments.

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Strategy Development Example Shareholder Value Shareholder Value Analysis Capital Structure