Dreamworks Animation SKG 2010

Dreamworks Animation revenues by film for 2008-2010

(source Dreamworks Animation – Annual Reports)

DreamWorks Animation SKG reports are a joy to read. Straightforward explanation of the business of producing films. In parts the report reads like a manual of film production.

Development phase table for feature film - Dreamworks Animation Annual Report 2010

This clarity of presentation is carried through to the financial part as well. I recommend these reports to anyone who wants to have an idea about film production or running a company.

Classic: The Reichsbank 1914

The Reichsbank balance sheet July 23 - August 15 1914

A run on the banks to redeem the mark started on July 23—the day Austria-Hungary issued an ultimatum to Serbia following the assassination of Archduke Franz Ferdinand—after July 28 private banks stopped paying gold. The people rushed to the Reichsbank, first it tried to persuade them from redeeming their mark banknotes but on the first of August it too closed the gold window.

In one week the Reichsbank’s gold reserve declined by a 100 million mark, although it was increased when the state transferred a gold horde—known as the ‘war treasure’—to the central bank.

In three weeks the notes in circulation more than doubled, as the government mobilised for war. The gold cover would decline steadily as the war went on. In the first 17 months of the war the gold relative to Notes and Deposits declined from 47% to 29%:

The Reichsbank gold cover July 1914 - December 1915

Source for both tables:

German War Finance
M. Chase Going
Journal of Political Economy , Vol. 24, No. 6 (Jun., 1916), pp. 513-546
Published by: The University of Chicago Press
Article Stable URL: http://www.jstor.org/stable/1819623

See also:

• Reichsbank, Wikipedia.
• German gold mark, Wikipedia.

Classic: Austro-Hungarian Bank 1914-1918

Balance Sheet of Austro-Hungarian Bank — 1914-1918

(source: The Dissolution of the Austro-Hungarian Empire — PDF).

Here we have the balance sheet of two different central banks: the first is maintaining a gold-backed currency (although by 1914 it was irredeemable). The second is a central bank that has financed an expensive war by issuing fiat currency. Bullion reserves went down in four years from 52% of assets to 0.9%; a 98% decline in reserves relative to assets.

The result was inflation: “Consumer prices rose sixteenfold during the war”[1] and both Austria and Hungary suffered from hyperinflation after the war. “In 1922, inflation in Austria reached 1426%, and from 1914 to January 1923, the consumer price index rose by a factor of 11836″.[2]

References:

1. Austro-Hungarian krone
2. Hyperinflation: Austria

See also:

• Banknotes of the Austro-Hungarian krone, Wikipedia.
• History of Austrian Money: Gulden and Krone Currency, central bank of the Republic of Austria.

General Electric Company 2009

GE Income Statement

GE Balance Sheet

(source Yahoo! Finance General Electric Company)

Percent of Interest expense from Gross Profit (in $ billion):
2007 : 23.88 / 99.6 = 24%
2008 : 26.2 / 98.74 = 26.5%
2009 : 18.77 / 77.85 = 24.1%

Percent of Net income from Gross Profit:
2007 : 22.2 / 99.6 = 22.3%
2008 : 17.34 / 98.74 = 17.6%
2009 : 11 / 77.85 = 14.1%

The share of gross profits paid to bondholders is steady at about one quarter, but the share going to shareholders has declined from about a fifth to a seventh of the gross profits.

Ratio of Total equity to Total liabilities (in $ billion):
2007 : 115.6 : 679.8 = 1 : 5.88 
2008 : 104.7 : 693.1 = 1 : 6.62
2009 : 117.3 : 664.5 = 1 : 5.66

High leverage for an industrial company, almost half the leverage of a commercial bank.

Arion Bank 2009

Capital controls and the International Monetary Fund

Arion Bank Year in Review 2009

(source Arion Bank Annual report 2009)

currency converted at ISK 115.75 per $1

Net earnings = 12.9 billion / 115.75 = $111.44 million
Total assets = 757.3 billion / 115.75 = $6.54 billion

After the failure of Kaupthing Bank the Icelandic authorities created Arion Bank to take over Kaupthing domestic deposit liabilities and the bulk of its Icelandic assets with a capital injection from the government.

Bank of England 2010

Balance Sheet as at 28 February 2010

(source Bank of England Annual Report 2010)

growth in liabilities = 218.880 - 144.607 = £74.273 billion
as a percentage = 74.273 / 144.607 = 51.3%

One of every £3 on the balance sheet is only a year old.

ABN AMRO Bank 2009

Pro forma consolidated income statement for the year ended 31 December

 

Pro forma consolidated statement of financial position 31 December

(source ABN AMRO Bank 2009 Annual Review )

total liabilities = €197.806 billion
interest expense = €4.803 billion

Borrow about €198 billion at 2.43%* interest rate and pay about €4.8 billion

total assets = €202.084 billion
interest income = €7.782 billion

Lend about €202 billion at 3.85%** interest rate and earn about €7.8 billion

net interest income = €2.979 billion
other income = €2.32 billion
operating income = €5.299 billion

operating income / total assets = 5.299 / 202.084 = 2.62%

total equity = €4.278 billion

equity : liabilities = 4.278 : 197.806 = 1 : 46.24

*: average calculated by dividing interest expense on total liabilities.

*: average calculated by dividing interest income on total assets.