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MBA 564 2004 01A
Appendix 1.2Illustrating Organizational DistressUsing Fortune 500 DataOzzie Mascarenhas S. J.; Ph.D.There is no single definition for corporate distress. Based on Fortune 500 companies data, we offer three operational definitions of corporate distress: a) Highest profit loss in absolute terms; b) Highest loss in Fortune 500 rank from the previous year, and c) Highest percentage loss in sales from the previous year. Accordingly, we present the following data:
Table 1.2.1 lists the fifteen worst organizational distresses among the Fortune 500 of 2002-2003 based on highest absolute loss in annual profits.
Table 1.2.2 lists the fifteen worst organizational distresses among the Fortune 500 of 2002-2003 in terms of highest Fortune 500 rank loss from the previous year.
Table 1.2.3 lists the fifteen worst organizational distresses among the Fortune 500 of 2002-2003 defined by highest percentage sales loss from the previous year.
Table 1.2.4 lists the fifteen worst organizational distresses among the Fortune 500 of 2003-2004 in relation to highest absolute loss in annual profits.
Table 1.2.5 lists the fifteen worst organizational distresses among the Fortune 500 of 2003-2004 assessed by highest Fortune 500 rank loss from the previous year.
Table 1.2.6 lists the fifteen worst organizational distresses among the Fortune 500 of 2003-2004 measured by highest percentage sales loss from the previous year.
Fortune 500 ranks are based on annual sales in dollars. Loss in sales in a given year does not necessarily imply loss in profits for that year. Profit loss may have a lag effect. Moreover, a company losing sales in a given year could still show profits by cutting down on: a) costs of goods sold, b) costs of marketing and distribution, c) costs of administrative overhead, or increase profits by d) selling assets or business divisions, e) collecting accumulated receivables, f) collecting bad debts, g) reducing debt service when lending interest or mortgage rates plunge downwards, and h) by reducing debt payments if domestic currencies appreciate against currencies of creditors. Conversely, profit losses in a given year could also occur by: a) increasing costs of goods sold, b) increasing costs of marketing and distribution, c) increasing costs of administrative overhead, d) selling assets or business divisions below book value, e) increasing accumulated receivables, f) increasing bad debts, g) increasing debt service when lending interest or mortgage rates soar upwards, and h) by increased debt payments when domestic currencies depreciate vis vis creditor currencies.
Hence, there is a very low correlation or overlap of companies in Tables 1.2.1 and 1.2.2 (just one company overlaps for the 2002-2003 data) and between Tables 1.2.1 and 1.2.3, (just two companies overlap for the 2002-2003 data). Similarly, there is little overlap of companies between Tables 1.2.4 and 1.2.5 (only three companies for the 2003-2004 data) and between Tables 1.2.4 and 1.2.6, (three companies for the 2003-2004 data). See Tables 1.2.7 and 1.2.8.On the other hand, since Fortune 500 ranks are defined by annual sales in dollars, worst performance definitions based on Fortune 500 rank loss or percentage sales loss should be closely related. Thus, there is significant overlap of companies in Tables 1.2.1 and 1.2.3 (12 companies for the 2002-2003 data) and between Tables 1.2.4 and 1.2.6 (eight companies for the 2003-2004 data). See Tables 1.2.7 and 1.2.8.
Fortune 500 Corporate Distress in 2002-2003
Under all three definitions of organizational distress, Fortune 500 rank based on annual sales of 2002-2003 is highly and positively correlated with the same rank of 2001-2002. See Table 1.2.9. Fortune 500 Corporate Distress in 2003-2004
Under all three definitions of organizational distress, Fortune 500 rank based on annual sales of 2003-2004 is highly and positively correlated with the same rank of 2002-2003. See Table 1.2.9.
Under all three definitions of organizational distress, several key performance variables (e.g., sales, profits) show negative and significant correlations with profit ratios (e.g., ROA, ROS, ROE, and EPS). For details, see Table 1.2.10.Table 1.2.1: The Fifteen Worst Organizational Distresses among U. S. Companies of 2002-2003 based on Profit Losses[Source: Compiled from Fortune, April 14, 2003, pp. F1 F20]
Company,
Headquarters
(Rank 2002, Rank 2001)
(Rank loss/gain)2002 Sales
($ billion)
(% from 2001)2002 Profits
($ billion)
(% from 2001)Rank in Profits Loss
2002 Assets
($ billion)
(Rank)Market Value
($ billions)
(3/14/03)
(Rank)ROS
ROA
ROEEPS 2002
(% change from 2001)
AOL Time Warner,
New York, NY
(29, 37) (+8)41.780
(9.3)(98.696)
(---)495115.450
(35)49.753
(35)(236.2)
(85.5)
(186.9)(22.15)
(---)
Qwest Communications
Denver, CO
(121, 102) (-19)15.487
(21.6)(35.913)
(---)49431.228
(113)6.493
(221)(231.9)
(115.0)
(---)(21.35)
Clear Channel Communications,
San Antonio, TX
(219, 243) (+24)8.421
5.7(16.054)
(---)49327.672
(125)21.537
(73)(190.6)
(58.0)
(113.0)(25.56)
(---)
AT&T,
Bedminster, NJ
(22, 15) (-7)46.727
(21.0)(13.082)
(269.6)49255.272
(65)12.670
(121)(28.0)
(23.7)
(106.3)(17.08)
(---)
NTL Europe
New York, NY
(403, 434) (+31)3.970
7.3(12.748)
(---)49116.977
(178)0.001
(475)(321.1)
(75.1)
(---)(47.03)
(---)
Lucent Technologies,
Murray Hill, NJ
(141, 76) (-65)13.568
(46.0)(11.753)
(---)49011.791
(176)5.906
(231)(86.6)
(66.1)
(---)(3.49)
(---)
CIT Group, Livingston, NJ
(317, xxx) (?)5.275
(---)(6.699)
(---)48942.711
(84)3.935
(277)(127.0)
(15.7)
(140.8)(31.66)
(---)
Conseco
Camel, Ind
(284, 239) (-45)6.148
(24.2)(6.204)
(---)4886.905
(311)0.014
(470)(100.9)
(89.9)
(116.1)(17.96)
(---)
TXU
Dallas, TX
(134, 58) (-76)14.086
(49.6)(4.210)
(721.9)48730.891
(115)5.223
(249)(29.9)
(13.6)
(83.1)(15.23)
(704.4)
Centerpoint Energy
Houston, TX
(236, 26) (-210)7.923
(82.9)(3.920)
(499.8)48619.634
(162)1.893
(352)(49.5)
(20.0)
(275.7)(13.08)
(490.4)
Kmart,
Troy, MI
(39, 40) (+1)32.765
(9.4)(3.691)
(---)48513.292
(218)0.059
(466)(11.3)
(27.6)
(328.4)(7.36)
(---)
AMR
Fort Worth, TX
(104, 108) (+4)17.299
(8.8)(3.511)
(---)48430.210
(117)0.231
(456)(20.3)
(11.6)
(417.5)22.57)
(---)
AES
Arlington, VA
(181, 201) (+20)10.332
7.5(3.509)
(1385.3)48333.776
(106)1.697
(367)(34.4)
(10.4)
(---)(6.51)
(1376.5)
UAL
Elk Grove Twp, IL
(132, 125) (+7)14.286
(11.5)(3.212)
(---)48224.190
(147)0.056
(467)(22.5)
(13.3)
(246.5)(53.55)
(---)
Solectron
Milpitas, CA
(158, 110) (-48)12.276
(34.3)(3.110)
((---)48111.014
(244)2.537
(333)(25.3)
(28.2)
(65.2)(3.98)
(---)
Table 1.2.2: The Fifteen Worst Organizational Distresses U. S. Companies of 2002-2003 Based on Fortune 500 Rank Losses[Source: Compiled from Fortune, April 14, 2003, pp. F1 F20]
Company,
Headquarters
(Rank 2002, Rank 2001)
(Rank Loss)2002 Sales
($ billion)
(% from 2001)2002 Profits
($ billion)
(% from 2001)Rank in Profits Loss
2002 Assets
($ billion)
(Rank)Market Value
($ billions)
(3/14/03)ROS
ROA
ROEEPS 2002
(% change from 2001)
Aquila,
Kansas City, MO
(477, 33) (-444)3.179
(92.1)(1.103)
(494.9)46410.678
(252)0.282
(453)(34.7)
(10.3)
(49.0)(7.22)
(398.3)
Allegheny Energy
Hagerstown, MD
(496, 185) (-311)2.965
(71.4)(0.270)
(164.6)41010.874
(246)0.643
(432)(9.1)
(2.5)
(11.9)(2.18)
(162.8)
Dynegy,
Houston, TX
(336, 30) (-306)4.950
(88.3)(2.802)
(748.6)47925.147
(138)0.784
(418)(56.6)
(11.1)
(133.6)(8.56)
(813.3)
Centerpoint Energy
Houston, TX
(236, 26) (-210) 7.923
(82.9)(3.920)
(499.8)486
19.643
(162)1.893
(352)49.5)
(20.0)
(275.7)(13.08)
(490.4)
Mirant
Atlanta, GA
(259, 52) (-207)7.125
(77.4)(0.197)
(134.7)40421.375
(156)0.590
(435)(2.8)
(0.9)
(3.8)(0.48)
(129.4)
Anadarko Petroleum, The Woodlands, TX
(414, 232) (-182)3.860
(53.9)0.831
(---)10218.248
(173)10.793
(138)21.5
4.6
11.93.21
(---)
Corning
Corning, NY
(455, 289) (-166)3.432
(45.3)(1.302)
(---)46811.548
(238)7.060
(203)(37.9)
(11.3)
(27.8)(1.39)
(---)
El Paso,
Houston, TX
(152, 17) (-135)12.616
(78.0)0.644
592.512849.106
(74)3.115
(308)5.1
1.3
6.31.23
583.3
Sierra Pacific Resources,
Reno, Nevada
(494, 359) (-135)2.992
(35.1)(307.5)
(642.0)4187.569
(297)0.300
(452)(10.3)
(4.1)
(21.8)(3.01)
(563.1)
Servicemaster
Downers Grove, IL
(437, 308) (-129) 3.628
(37.6)0.157
1.22853.419
(406)2.784
(321)4.3
4.6
12.80.51
(0.00)
CMS Energy
Dearborn, MI
(272, 156) (-116)6.676
(48.6)0.199
(---)26115.222
(196)0.507
(441)3.0
1.3
9.81.39
(---)
Computer Associates Intl
Islandia, NY
(497, 387) (-110)2.964
(29.4)(1.102)
(---)46212.226
(231)8.184
(186)(37.2)
(9.0)
(23.9)(1.91)
(---)
American Electric Power,
Columbus, OH
(120, 13) (-107)15.583
(74.6)(0.519)
(153.5)43634.741
(101)8.496
(181)(231.9)
(115.0)
(---)(21.35)
(---)
Occidental Petroleum
Los Angeles, CA
(252, 146) (-106)7.429
(47.4)0.989
(14.3)8716.548
(181)11.364
(135)13.3
6.0
15.72.61
(15.5)
Duke Energy
Charlotte, NC
(118, 14), (-104)15.663
(73.7)1.034
(45.5)8160.966
(61)12.597
(123)6.6
1.7
6.81.22
(50.0)
Table 1.2.3: The Fifteen Worst Organizational Distresses among U. S. Companies of 2002-2003 based on Percentage Sales Loss
[Source: Compiled from Fortune, April 14, 2003, pp. F1 F20]
Company,
Headquarters
(Rank 2003, Rank 2002)
(Rank Loss)2003 Sales
($ billion)
(% from 2002)2003 Profits
($ billion)
(% from 2002)Rank in Profits Loss
2003 Assets
($ billion)
(Rank)Market Value
($ billions)
(3/01/04)
(Rank)ROS
ROA
ROEEPS 2003
(% change from 2002)
Aquila,
Kansas City, MO
(477, 33) (-444)3.179
(92.1)(1.103)
(494.9)46410.678
(252)0.282
(453)(34.7)
(10.3)
(49.0)(7.22)
(398.3)
Dynegy,
Houston, TX
(336, 30) (-306)4.950
(88.3)(2.802)
(748.6)47925.147
(138)0.784
(418)(56.6)
(11.1)
(133.6)(8.56)
(813.3)
Centerpoint Energy
Houston, TX
(236, 26) (-210) 7.923
(82.9)(3.920)
(499.8)486
19.643
(162)1.893
(352)49.5)
(20.0)
(275.7)(13.08)
(490.4)
El Paso,
Houston, TX
(152, 17) (-135)12.616
(78.0)0.644
592.512849.106
(74)3.115
(308)5.1
1.3
6.31.23
583.3
Mirant
Atlanta, GA
(259, 52) (-207)7.125
(77.4)(0.197)
(134.7)40421.375
(156)0.590
(435)(2.8)
(0.9)
(3.8)(0.48)
(129.4)
American Electric Power,
Columbus, OH
(120, 13) (-107)15.583
(74.6)(0.519)
(153.5)43634.741
(101)8.496
(181)(231.9)
(115.0)
(---)(21.35)
(---)
Duke Energy
Charlotte, NC
(118, 14), (-104)15.663
(73.7)1.034
(45.5)8160.966
(61)12.597
(123)6.6
1.7
6.81.22
(50.0)
Allegheny Energy
Hagerstown, MD
(496, 185) (-311)2.965
(71.4)(0.270)
(164.6)41010.874
(246)0.643
(432)(9.1)
(2.5)
(11.9)(2.18)
(162.8)
Anadarko Petroleum, The Woodlands, TX
(414, 232) (-182)3.860
(53.9)0.831
(---)10218.248
(173)10.793
(138)21.5
4.6
11.93.21
(---)
TXU
Dallas, TX
(134, 58) (-76)14.086
(49.6)(4.210)
(721.9)48730.891
(115)5.223
(249)(29.9)
(13.6)
(83.1)(15.23)
(704.4)
CMS Energy
Dearborn, MI
(272, 156) (-116)6.676
(48.6)0.199
(---)26115.222
(196)0.507
(441)3.0
1.3
9.81.39
(---)
Occidental Petroleum
Los Angeles, CA
(252, 146) (-106)7.429
(47.4)0.989
(14.3)8716.548
(181)11.364
(135)13.3
6.0
15.72.61
(15.5)
Lucent Technologies,
Murray Hill, NJ
(141, 76) (-65)13.568
(46.0)(11.753)
(---)49011.791
(176)5.906
(231)(86.6)
(66.1)
(---)(3.49)
(---)
Corning
Corning, NY
(455, 289) (-166)3.432
(45.3)(1.302)
(---)46811.548
(238)7.060
(203)(37.9)
(11.3)
(27.8)(1.39)
(---)
PG&E
San Francisco
(140, 87) (-53)13.784
(40.0)(0.874)
(179.5)45333.696
(107)5.299
(246)(6.3)
(2.6)
(24.2)(2.36)
(178.1)
Table 1.2.4: The Fifteen Worst Organizational Distresses among U. S. Companies of 2003-2004 Based on Loss of Profits
[Source: Compiled from Fortune, April 5, 2004, pp. F1 F20]
Company,
Headquarters
(Rank 2003, Rank 2002)
(Rank loss/gain) 2003 Sales
($ billion)
(% from 2002)2003 Profits
($ billion)
(% from 2002)Rank in Profits Loss
2003 Assets
($ billion)
(Rank)Market Value
($ billions)
(3/01/04)
(Rank)ROS
ROA
ROEEPS 2003
(% change from 2002)
Mirant,
Atlanta, GA
(315, 259) (-55)5.863
(10.3)(4.474)
(---)50014.158
(213)0.191
(470)(76.3)
(31.6)
(584.8)(11.00)
(---)
El Paso,
Houston, TX
(154, 152) (-2)12.653
1.2(3.464)
(---)49942.676
(85)4.592
(325)(27.4)
(8.1)
(51.3)(6.01)
(---)
Solectron,
Milpitas, CA
(167, 158) (-9)11.404
(4.7)(3.462)
(---)4986.530
(328)5.278
(307)(29.6)
(53.0)
(243.5)(4.18)
(---)
RJ Reynolds Tobacco,
Winston-Salem, NC (341, 281) (-60)5.267
(15.2)(3.446)
(---)4979.677
(271)5.298
(306)(65.4)
(35.6)
(112.7)(41.17)
(---)
Sun Microsystems
Santa Clara, CA
(173, 155) (-41)11.434
(8.5)(3.429)
(---)49612.985
(230)17.618
(130)(30.0)
(26.4)
(52.8)(1.07)
(---)
UAL
Elk Grove Twp, IL
(145, 132) (-13)13.724
(3.9)(2.808)
(---)49521.979
(153)0.389
(465)(20.5)
(12.8)
(---)(27.36)
(---)
Agilent Technologies,
Palo Alto, CA
(305, 292) (-13)6.056
0.8(2.058)
(---}4946.297
(333)16.478
(141)(34.0)
(32.7)
(72.9)(4.35)
(---)
Kmart Holding
Troy, MI
(67, 39) (-28)26.032
(15.4)(1.991)
(---)4936.117
(338)2.694
(388)(7.6)
(32.5)
(116.6)(4.12)
(---)
EDS
Plano, TX
(87, 80) (-7)21.596
(0.9)(1.698)
(252.2)49218.280
(175)9.127
(220)(7.9)
(9.3)
(29.7)(3.55)
(255.7)
Goodyear Tire & Rubber, Akron, OH
(139, 137) (+2)14.741
6.4(1.438)
(---)49113.477
(221)5.633
(300)(9.8)
(9.8)
(334.9)(8.52)
(---)
Reliant Resources
Houston, TX
(166, 164) (-2)11.707
1.4(1.342)
(---)49013.308
(224)2.324
(404)(11.5)
(10.1)
(30.7)(4.57)
(---)
Duke Energy
Charlotte, NC
(75, 118) (+43)23.483
49.9(1.323)
(227.9)48955.946
(66)20.093
(110)(5.6)
(2.4)
(9.7)(1.48)
(221.3)
AMR,
Fort Worth, TX
(110, 104) (-6)17.444
0.8(1.228)
(---)48829.330
(120)2.518
(392)(7.0)
(4.2)
(2,669.6)(7.76)
(---)
Laidlaw International,
Naperville, IL
(391, xxx) (?)4.483
(---)(1.223)
(---)4873.853
(397)1.517
(432)(27.3)
(31.7)
(94.8)(3.82)
(---)
Visteon
Dearborn, MI
(109, 97) (-12)17.660
(4.6)(1.213)
(---)48610.964
(251)1.344
(439)(6.9)
(11.1)
(65.3)(9.65)
(---)
Table 1.2.5: The Fifteen Worst Organizational Distresses among U. S. Companies of 2003-2004 Based on Fortune 500 Rank Losses[Source: Compiled from Fortune, April 5, 2004, pp. F1 F20]
Company,
Headquarters
(Rank 2003, Rank 2002)
(Rank Loss)2003 Sales
($ billion)
(% from 2002)2003 Profits
($ billion)
(% from 2002)Rank in Profits Loss
2003 Assets
($ billion)
(Rank)Market Value
($ billions)
(3/01/04)
(Rank)ROS
ROA
ROEEPS 2003
(% change from 2002)
Cinergy
Cincinnati, OH
(393, 160) (-233)4.416
(63.2)0.470
30.322214.119
(215)7.100
(262)10.6
3.3
12.72.63
23.5
Lucent Technologies
Murray Hill, NJ
(243, 141) (-102)8.470
(37.6)(0.770)
(---)48015.765
(190)17.849
(126)(9.1)
(4.9)
(---)(0.29)
(---)
Gateway
Poway, CA
(484, 387) (-97)3.402
(18.4)(0.515)
(---)4752.028
(463)1.885
(417)(15.1)
(25.4)
(66.7)(1.62)
(---)
Conseco
Carmel, Indiana
(370, 284) (-86)4.710
(30.7)2.298
(---)5429.922
(117)2.242
(408)48.8
7.7
81.6(---)
(---)
OM Group
Cleveland, OH
(405, 331) (-74)4.298
(14.7)(0.248)
(---)4621.298
(491)0.911
(451)(5.8)
(19.1)
(48.3)(8.86)
(---)
Xcel Energy
Minneapolis, MN
(254, 180) (-74)7.939
(22.6)0.623
(---)18318.264
(176)7.159
(261)7.8
3.4
11.71.5
(---)
Avaya
Basking Ridge, NJ
(401, 335) (-66)4.338
(12.5)(0.088)
(---)4484.057
(393)7.716
(253)(2.0)
(2.2)
(44.0)(0.23)
(---)
Merck
Whitehouse Stn, NJ
(83, 17) (-66)22.856
(56.6)6.831
(4.5)1540.588
(90)107.801
(17)30.4
16.8
43.93.03
(3.05)
Applied Chemicals
Santa Clara, CA
(392, 327) (-65)4.477
(11.3)(0.150)
(155.4)45510.312
(259)36.589
(65)(3.3)
(1.4)
(1.8)(0.09)
(156.3)
American Financial Group,
Cincinnati, OH
(486, 424) (-62)3.366
(10.2)0.294
247.127720.200
(167)2.105
(412)8.7
1.5
14.24.12
237.7
RJ Reynolds Tobacco,
Winston-Salem, NC
(341, 281) (-60)5.267
(15.2)(3.446)
(---)4979.677
(271)5.298
(306)(65.4)
(35.6)
(112.7)(41.17)
(---)
Schering-Plough
Kenilworth, NJ
(247, 187) (-60)8.334
(18.1)(0.092)
(104.7)45015.102
(198)26.629
(83)(1.1)
(0.6)
(1.3)(0.06)
(104.5)
Comerica
Detroit, MI
(489, 433) (-56)3.299
(10.8)0.661
10.016752.592
(68)10.059
(209)20.0
1.3
12.93.75
10.3
Mirant,
Atlanta, GA
(314, 259) (-55)5.863
(10.3)(4.474)
(---)50014.158
(213)190.6
(470)(76.3)
(31.6)
(584.8)(11.00)
(---)
CIT Group
Livingston, NJ
(371, 317) (-54)4.677
(11.3)0.567
(---)19246.343
(79)8.376
(233)12.1
1.2
10.52.66
(---)
Table 1.2.6: The Fifteen Worst Organizational Distresses among U. S. Companies of 2003-2004 based on Percentage Sales Loss
[Source: Compiled from Fortune, April 5, 2004, pp. F1 F20]
Company,
Headquarters
(Rank 2003, Rank 2002)
(Rank Loss)2003 Sales
($ billion)
(% from 2002)2003 Profits
($ billion)
(% from 2002)Rank in Profits Loss
2003 Assets
($ billion)
(Rank)Market Value
($ billions)
(3/01/04)
(Rank)ROS
ROA
ROEEPS 2003
(% change from 2002)
Cinergy
Cincinnati, OH
(393, 160) (-233)4.416
(63.2)0.470
30.322214.119
(215)7.100
(262)10.6
3.3
12.72.63
23.5
Merck
Whitehouse Stn, NJ
(83, 17) (-66)22.856
(56.6)6.831
(4.5)1540.588
(90)107.801
(17)30.4
16.8
43.93.03
(3.05)
CMS Energy
Jackson, MI
(307, 272) (-35)6.017
(38.9)(0.044)
(---)44213.838
(218)1.505
(433)(0.7)
(0.3)
(2.4)(0.30)
(---)
Lucent Technologies
Murray Hill, NJ
(243, 141) (-102)8.470
(37.6)(0.770)
(---)48015.765
(190)17.849
(126)(9.1)
(4.9)
(---)(0.29)
(---)
Conseco
Carmel, Indiana
(370, 284) (-86)4.710
(30.7)2.298
(---)5429.922
(117)2.242
(408)48.8
7.7
81.6(---)
(---)
AT&T
Bedminster, NJ
(40, 22) (-18)34.529
(26.1)1.865
(---)6147.988
(75)16.090
(149)5.4
3.9
13.42.36
(---)
Xcel Energy
Minneapolis, MN
(254, 180) (-74)7.939
(22.6)0.623
(---)18318.264
(176)7.159
(261)7.8
3.4
11.71.5
(---)
Circuit City Stores
Richmond, VA
(195, 151) (-44)9.954
(22.2)0.106
(51.5)3713.799
(400)2.478
(395)1.1
2.8
4.5(---)
(---)
Conagra Foods
Omaha, NE
(84, 50) (-34)22.053
(20.2)0.774
(1.0)14515.071
(201)14.658
(155)3.5
5.1
16.81.46
(0.7)
TXU
Dallas
(177, 134) (-43)11.325
(19.6)0.582
(---)18931.686
(112)9.163
(219)5.1
1.8
9.81.62
(---)
PG&E Corp
San Francisco, CA
(179, 140) (-39)11.221
(18.6)0.420
(---)23730.175(116)11.991
(181)3.7
1.4
10.01.06
(---)
Gateway
Poway, CA
(484, 387) (-97)3.402
(18.4)(0.515)
(---)4752.028
(463)1.885
(417)(15.1)
(25.4)
(66.7)(1.62)
(---)
Schering-Plough
Kenilworth, NJ
(247, 187), (-60)8.334
(18.1)(0.092)
(104.7)45015.102
(198)26.629
(83)(1.1)
(0.6)
(1.3)(0.06)
(104.5)
Kmart Holding
Troy, MI
(39, 67) (+28)26.032
(15.4)(1.991)
(---)4936.117
(338)2.694
(388)(7.6)
(32.5)
(116.6)(4.12)
(---)
RJ Reynolds Tobacco,
Winston-Salem, NC (281, 341) (+60)5.267
(15.2)(3.446)
(---)4979.677
(271)5.298
(306)(65.4)
(35.6)
(112.7)(41.17)
(---)
Table 1.2.7: Comparison of Various Definitions of Corporation Distress: Operational Outcomes
Dimension of ComparisonFortune 500- 2002-2003 Data:
Definition of DistressFortune 500- 2003-2004 Data:
Definition of Distress
Highest Absolute Loss in Profits
($ billions)
Highest Fortune 500 Absolute Rank Loss
Highest Percentage Sales Loss
Highest Absolute Loss in Profits
($ billions)
Highest Fortune 500 Absolute Rank LossHighest Percentage Sales Loss
Tables1.2.11.2.21.2.31.2.41.2.51.2.6
Company Overlap12
128
33
Fortune 500 Rank: Mean (Median) (SD) (Range)168.00
(141.00)
(108.61)
(381.00)334.33
(336.00)
(141.90)
(379.00)266.80
(252.00)
(137.91)
(378.00)182.73
(154.00)
(103.67)
(324.00)351.53
(371.00)
(110.12)
(406.00)
230.93
(243.00)
(131.53)
(444.00)
Fortune 500 Rank previous year: Mean (Median) (SD) (Range)129.57
(105.00)
(115.25)
(419.00)149.80
(146.00)
(136.32)
(374.00)94.27
(58.00)
(87.28)
(276.00)155.00
(145.50)
(74.81)
(253.00)270.87
(284.00)
(115.12)
(416.00)
163.00
(151.00)
(107.85)
(370.00)
Rank Loss:
Mean (Median) (SD) (Range)-27.79
(-7.00)
(62.07)
(241.00)-184.533
(-135.00)
(98.74)
(340.00)-172.53
(-135.00)
(109.09)
(391.00)-12.86
(-10.50)
(24.69)
(103.00)-80.67
(-66.00)
(44.64)
(179.00)
-67.93
(-60.00)
(52.16)
(215)
Sales in Billion among top 15 companies: Mean (Median) (SD) (Range) 16.69
(13.57)
(13.15)
(42.76)6.73
(4.95)
(4.49)
(12.70)8.86
(7.43)
(4.83)
(12.70)13.57
(12.65)
(6.72)
(21.55)6.38
(4.68)
(4.87)
(19.56)
12.44
(8.47)
(9.38)
(31.13)
Change from Previous Year: Mean (Median) (SD) (Range)-21.29
(-16.25)
(25.26)
(90.4)-62.38
(-71.40)
(20.75)
(62.70)-64.61
(-71.40)
(17.81)
(62.70)
-0.21
(-2.40)
(15.79)
(65.30)-22.90
(-15.20)
(17.01)
(53.00)-28.23
(-22.20)
(14.82)
(48.00)
Assets in Billion among top 15 companies: Mean (Median) (SD) (Range) 31.40
(27.67)
(26.60)
(108.55)21.15
(16.55)
(15.86)
(57.55)24.70
(19.63)
(14.86)
(50.29)17.71
(13.31)
(14.65)
(52.09)19.63
(15.10)
(15.85)
(51.29)
19.61
(15.10)
(13.55)
(45.96)
Fortune 500 Rank in Billion Assets:
Mean (Median) (SD) (Range)488.00
(488.00)
(4.47)
(14)194.13
(181.00)
(89.40)
(345.00)158.40
(162.00)
(59.81)
(191.00)227.00
(224.00)
96.78)
(331.00)226.00
(198.00)
(131.66)
(423)
212.00
(198.00)
(113.94)
(388.00)
Table 1.2.8: Comparison of Various Definitions of Corporation Distress: Profitability Ratios
Dimension of ComparisonFortune 500- 2002-2003 Data:
Definition of DistressFortune 500- 2003-2004 Data:
Definition of Distress
Highest Absolute Loss in Profits
($ billions)Highest Fortune 500 Absolute Rank LossHighest Percentage Sales Loss
Highest Absolute Loss in Profits
($ billions)
Highest Fortune 500 Absolute Rank LossHighest Percentage Sales Loss
Tables1.2.11.2.21.2.31.2.41.2.51.2.6
Profits among top 15 companies: Mean (Median) (SD) (Range) -15.09
(-6.20)
(24.67)
(95.59)-20.990
(-0.27)
(79.27)
(308.53)-1.55
(-0.52)
(3.28)
(12.79)-2.31
(-1.99)
(1.10)
(3.261)
0.13
(-0.09)
(2.47)
(11.31)0.47
(0.42)
(2.24)
(10.28)
Change from Previous Year: Mean (Median) (SD) (Range)-719.15
(-610.85)
(480.96)
(1115.70)-209.47
(-153.5)
(375.07)
(1341.10)-233.16
(-164.60)
(378.50)
(1341.50)-240.05
(-240.05)
(17.18)
(34.30)
3.80
(2.75)
(139.37)
(402.50)-26.28
(-4.50)
(52.68)
(135.00)
Market Value among top 15 companies: Mean (Median) (SD) (Range) 7.47
(2.54)
(13.08)
(49.75)4.63
(2.78)
(4.59)
(12.32)4.97
(5.22)
(4.32)
(12.32)6.34
(4.59)
(6.54)
(19.902)16.13
(7.16)
(27.33)
(107.61)15.64
(7.16)
(26.51)
(106.30)
Fortune 500 Rank in Market Value:
Mean (Median) (SD) (Range)306.20
(333.00)
(149.99)
(440.00)305.20
(321.00)
(130.97)
(330.00)289.67
(249.00)
(123.25)
(330.00)321.93
(325.00)
(122.49)
(360.00)264.87
(261.00)
(146.81)
(453.00)253.33
(261.00)
134.20)
(416.00)
ROS: Mean (Median) (SD) (Range)-101.03
(-49.50)
(98.81)
(309.80)-27.75
(-9.10)
(61.43)
(253.40)-33.05
(-9.10)
(62.64)
(253.40)-24.46
(-20.50)
(21.47)
(70.70)-2.65
(-1.10)
(32.13)
(125.10)1.16
(3.50)
(24.18)
(114.20)
ROA: Mean (Median) (SD) (Range)-43.58
(-27.60)
(34.72)
(104.60)-10.98
(-2.50)
(29.72)
(121.00)-15.90
(-2.60)
(32.53)
(121.00)-20.75
(-12.80)
(14.89)
(50.60)-5.70
(-0.60)
(15.09)
(52.40)-3.54
(1.80)
(15.17)
(52.40)
ROE: Mean (Median) (SD) (Range)-189.04
(-140.80)
(113.70)
(352.30)-34.59
(-7.85)
(79.53)
(291.40)-42.97
(-11.90)
(82.28)
(291.40)-319.236
(-83.85)
(694.24)
(2659.60)-48.01
(4.60)
(161.84)
(666.40)-6.80
(9.90)
(55.24)
(198.20)
EPS: Mean (Median) (SD) (Range)-20.57
(-17.96)
(14.60)
(50.06)-3.27
(-1.39)
(6.73)
(24.56)-4.38
(-2.18)
(7.29)
(24.56)-9.24
(-4.57)
(10.86)
(40.10)-3.26
(-0.08)
(11.78)
(45.29)-2.60
(1.06)
(11.75)
(44.20)
Table 1.2.9: Fortune 500 Rank Order Correlations for Worst Organizational Distresses by Defining Variables
Fortune 500 Data of worst Distresses based on:VariablesSales Rank in 2001-2002Profits Rank in 2002-2003Assets Rank in 2002-2003
Market Value Rank in
2002-2003
Highest Absolute
Profit Loss for 2002-2003Sales Rank in 2002-20030.845**-0.0030.3440.363
Sales Rank in 2001-20020.0780.3170.345
Profits Rank in 2002-2003-0.424-0.698**
Assets rank in 2002-20030.630**
Highest
Sales Rank Loss for 2002-2003Sales Rank in 2002-20030.749**0.4220.800**0.302
Sales Rank in 2001-20020.1070.730**-.100
Profits Rank in 2002-20030.3100.508
Assets rank in 2002-20030.326
Highest
Percentage Sales Loss for 2002-2003Sales Rank in 2002-20030.612*0.1100.848**0.396
Sales Rank in 2001-2002-0.1390.616*-0.189
Profits Rank in 2002-20030.2980.446
Assets rank in 2002-20030.407
Highest Absolute
Profit Loss for 2003-2004Sales Rank in 2002-20030.970**0.2490.531*0.142
Sales Rank in 2001-20020.527*0.260-0.136
Profits Rank in 2002-2003-0.039-0.083
Assets rank in 2002-20030.154
Highest
Sales Rank Loss for 2003-2004Sales Rank in 2002-20030.922**0.2150.3370.567*
Sales Rank in 2001-20020.2520.2880.531*
Profits Rank in 2002-20030.691**0.181
Assets rank in 2002-20030.404
Highest
Percentage Sales Loss for 2003-2004Sales Rank in 2002-20030.924**0.3580.4060.516*
Sales Rank in 2001-20020.4420.4500.615*
Profits Rank in 2002-20030.711**0.384
Assets rank in 2002-20030.635*
Table 1.2.10: Fortune 500 Correlations for Worst Corporate DistressesWorst performance based on:VariablesProfitsAssetsMarket ValueROSROAROEEPS
Highest Absolute
Profit Loss for 2002-2003Sales-0.5120.640*0.551*0.1450.005-0.1030.200
Profits-0.855**-0.909**0.571*0.566*-0.0710.064
Assets0.874**-0.298-0.1320.066-0.104
Market Value-0.431-0.3660.2110.006
ROS0.765**-0.2880.434
ROA-0.2980.069
ROE0.134
Highest
Sales Rank Loss for 2002-2003Sales0.2350.888**0.405-0.396-0.4770.029-0.292
Profits0.2410.268-0.072-0.0600.0300.000
Assets0.406-0.134-0.1860.053-0.061
Market Value-0.071-0.1390.3150.160
ROS0.983**0.750**0.911**
ROA0.839**0.871**
ROE0.919**
Highest
Percentage Sales Loss for 2002-2003Sales-0.2340.724**0.394-0.353-0.4490.046-0.311
Profits0.3020.1570.3430.4530.839**0.328
Assets0.376-0.0020.0030.136-0.034
Market Value-0.039-0.1290.3560.163
ROS0.966**0.791**0.803**
ROA0.857**0.706**
ROE0.816**
Highest Absolute
Profit Loss for 2003-2004Sales0.4530.4190.1420.756**0.494-0.0830.334
Profits0.0790.0540.800**0.524*-0.1470.339
Assets0.3360.2700.675**-0.1660.124
Market Value0.1170.0590.2730.340
ROS0.582*-0.0960.490
ROA-0.2400.127
ROE0.028
Highest
Sales Rank Loss for 2003-2004Sales0.660**0.3010.916**0.2100.4070.1130.128
Profits0.506*0.724**0.844**0.831**0.688**0.579*
Assets0.3360.505*0.561*0.2800.354
Market Value0.3050.4940.2480.224
ROS0.893**0.827**0.786**
ROA0.694**0.774**
ROE0.387
Highest
Percentage Sales Loss for 2003-2004Sales0.3390.507*0.3660.1590.133-0.0040.253
Profits0.697**0.780**0.782**0.795**0.761**0.581*
Assets0.4980.513*0.608*0.601*0.339
Market Value0.3220.4360.3130.203
ROS0.792**0.850**0.917**
ROA0.955**0.697**
ROE0.699*
PAGE 109
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