Badger Meter Financial Analysis

Introduction Badger Meter Inc. It develops and produces a variety of flow measurement and control products for diverse industries. It provides the global flow measurement market with products for water utilities, industrial and commercial markets including energy and petroleum; food and beverage; and many others. Sales of water meters and related technologies and services for water applications form a greater part of Badger Meter sales. It operates sales, distribution and manufacturing facilities in Germany, Mexico, Singapore, Slovakia, Czech Republic and the US. The company operates in international markets such as Europe, Latin America, Mexico, Singapore, China, Slovakia, and Czech Republic. It is headquartered in Milwaukee, the US. (Badger

Income statement and Balance Sheet for the years 2012 and 2013 were analyzed in common-size financial statements that are expressed as a percentage of a common base figure for an overall better understanding of the company’s financial status.
According to the common-size financial statements Badger Meter Inc.’s Income statement shows that from the previous year it increased its cost of goods by 10%. It also shows that its gross profit was lower by 4.3% from the previous year. It’s Selling, General, and Admin expenses were not much different from the previous year which it’s something that stands out; the difference was only of 0.1%. Its operating income was 12.1% less as well due to the higher COGS. Finally their net income was 12.2% less than the previous year.
Balance Sheet
As stated in the trend analysis statement, Badger Meter Inc. (BMI) balance sheet shows a decrease in its long-term liabilities. BMI does not have any long-term debt, but it does have some short-term debt. BMI’s Common and paid-in capital was less than the previous year by about 0.5%. Its Property, Plant, and Equipment, net of depreciation increased by 8.4% because they either started a new line of product, purchase or updated equipment or acquired another company. The total assets were increased by 14.1%. The stockholders equity was increased by

Their inventory also spent less days “on the shelf”. While the competitor collected payment on credit accounts more times than the industry and BMI, BMI collected payments almost the same amount of times. MWA’s customers also paid their credit purchases faster than BMI and the industry. Finally it appears that BMI was the company that used their assets more efficiently to generate sales with a higher total asset turnover ratio.

BMI appears to have managed its accounts receivable quite well but the competitor MWA managed to collect payment from credit accounts more times during the year. BMI managed to sell and restock its inventory 3.89 times during the year, and their inventory set on the shelf ninety four days they have room for improvement. The competitor managed its inventories better than BMI selling and restocking 4.18 times during the year while their inventory only sat on the shelf eighty seven days.

As of 12/31/12 BMI’s assets were invested in: Current assets 40.2%; Other Assets; 35.6% and depreciation 24.2%. Therefore, the total asset turnover is greatly affected by both current asset turnover ratios and the turnover of other