1
Exhibit (b)(2)
[GOLDMAN HIGHLY CONFIDENTIAL
SACHS LOGO] -------------------
PROJECT JUNIPER
PRESENTATION TO THE DISINTERESTED DIRECTORS
GOLDMAN, SACHS & CO.
GOLDMAN SACHS (JAPAN) LTD.
NOVEMBER 12, 1999
2
TABLE OF EXHIBITS
EXHIBIT
TRANSACTION SUMMARY 1
OVERVIEW OF JUNIPER 2
PUBLIC MARKET VALUATION 3
PRIVATE MARKET VALUATION 4
ANALYSIS OF PREMIA PAID IN SELECTED TENDER OFFERS AND MINORITY
BUYOUTS 5
DISCOUNTED CASH FLOW ANALYSIS 6
APPENDIX
DETAILED FINANCIALS A
[Goldman Sachs Logo]
3
TAB 1
4
TRANSACTION SUMMARY
JUNIPER
PURCHASER: |X| N.A.J. Co., Ltd. ("Purchaser") is a joint
stock corporation organized under the laws
of Japan. It is a wholly-owned subsidiary of
ALAP Hold Co., Ltd. ("ALAP"), a Nevada
limited partnership controlled by the
principal shareholders of Juniper (the
"Principal Shareholders")
TENDER OFFER PRICE: |X| Yen 1,490 per share, in cash
KEY STEPS: |X| Purchaser, ALAP and Juniper will enter into
a Tender Offer Agreement
|X| Tender Offer will remain open for 30 days
|X| The Principal Shareholders will not tender
but instead will transfer their shares in
Juniper to ALAP
-- Principal Shareholders own approximately
76.6% of the shares
-- An additional 3.2% of shares are owned by
charitable foundations established by the
Principal Shareholders - these will be
tendered in the Tender Offer
ADDITIONAL TRANSACTIONS: |X| Purchaser and Juniper will agree in
principle to enter into a merger after the
consummation of the Tender Offer
-- In the merger, any remaining Juniper
shareholders (including ALAP) would receive
shares in Purchaser, the surviving company,
in accordance with an exchange ratio that
has not yet been determined
-- Upon consummation of the merger, the shares
will be de-listed from the Japanese OTC and
the ADSs from the NYSE
-- Upon consummation of the merger, there will
be no public market for Purchaser shares. In
addition, a reverse stock split may be
effected, which would result in many
shareholders holding fractional shares.
Holders of fractional shares would face a
number of restrictions, including
non-transferability and lack of voting
rights
|X| The terms of the merger have not been
agreed-upon. Goldman Sachs cannot evaluate
the fairness of the merger transaction
CONDITIONS: |X| None.
EXPECTED FINANCING: |X| Morgan Guaranty bank facility
OTHER MATTERS: |X| Principal Shareholders will not sell their
shares to any third party
[GOLDMAN
SACHS LOGO]
5
JUNIPER SUMMARY OF OFFER
(JPY IN MILLIONS, EXCEPT FOR PER SHARE DATA)
CURRENT PRICE AS OF NOVEMBER 10, 1999
CURRENT INITIAL REVISED
PRICE OFFER OFFER
PREMIUM TO MARKET PRICE 0.0 % 39.2 % 53.6 %
PURCHASE PRICE PER SHARE 970 1,350 1,490
PREMIUM TO 52-WEEK AVERAGE (17.8)% 14.5 % 26.3 %
INCREASE FROM INITIAL OFFER 10.4 %
Number of Shares Outstanding (MM) (a) 144.0 144.0 144.0
Number of Shares to be Purchased (MM): 23.44% 33.8 33.8 33.8
Transaction Size 32,750 45,580 50,307
Implied Equity Consideration - Basic 139,705 194,435 214,599
Implied Equity Consideration - Options (b) - - -
------------------------------
EQUITY CONSIDERATION - DILUTED (b) 139,705 194,435 214,599
Net Debt (c) (21,748) (21,748) (21,748)
ENTERPRISE VALUE 117,957 172,687 192,851
EV MULTIPLE OF SALES FY 1999A 143,797 0.8x 1.2x 1.3x
FY 2000E 150,000 0.8 1.2 1.3
FY 2001E 156,000 0.8 1.1 1.2
EV MULTIPLE OF EBITDA (d) FY 1999A 22,218 5.3x 7.8x 8.7x
FY 2000E 18,251 6.5 9.5 10.6
FY 2001E 22,705 5.2 7.6 8.5
EV MULTIPLE OF EBIT (d) FY 1999A 20,261 5.8x 8.5x 9.5x
FY 2000E 15,410 7.7 11.2 12.5
FY 2001E 19,855 5.9 8.7 9.7
EQUITY MULTIPLE OF NET INCOME (d) FY 1999A 10,507 13.3x 18.5x 20.4x
FY 2000E 8,530 16.4 22.8 25.2
FY 2001E 10,920 12.8 17.8 19.7
PREMIUM TO:
52-Week High 1,430 (32.2)% (5.6)% 4.2%
All-Time High 9,267 (89.5) (85.4) (83.9)
52-Week Low 970 0.0 39.2 53.6
(a) As of August 31, 1999.
(b) Assumes 0.1 million options outstanding with a weighted average strike price
of 2,470. All are out of the money.
(c) Assumes net debt of (Yen)(21,748) million as of August 31, 1999.
(d) FY2000-2004E estimates by Juniper management
6
TAB 2
7
[Goldman Sachs Logo]
SWOT ANALYSIS
JUNIPER
STRENGTHS
- --------------------------------------------------------------------------------
[X] Japan one of the largest direct selling market in the world
[X] One of the longest established, largest direct selling companies in
Japan with a powerful sales force
[X] Japanese culture of extended family ties and lifelong close personal
relationships well-suited to Juniper Sales and Marketing Plan
[X] High quality products sold at a premium, mostly in third quartile price
range
[X] Well-recognized brand name
[X] Strong management team
[X] Healthy balance sheet with little fixed assets/capex needs
OPPORTUNITIES
- --------------------------------------------------------------------------------
[X] Economic recovery in Japan
[X] Recovering public image, with JCIC and press contained through
introduction of 3D Project, US government lobbying, sponsorship of
major sporting events
[X] Distributor morale recovering, supported by new incentive schemes
[X] New distributor recruiting initiatives
[X] 3D Project (direct fulfillment, direct marketing, distributor
communication) and better database management should improve
transparency and control of the distributor network, increasing
productivity in the long-term
[X] Internet strategy to be in place by 2000, involving a wholesale buying
club concept. Web already used to facilitate direct fulfillment
[X] New product launches targeted to the local market
[X] Scope for further alliances with other brands (e.g. DoCoMo, PerfecTV,
Rubbermaid)
[X] As Japan restructures and lifelong employment is threatened, Juniper's
entrepreneurial opportunities may become increasingly attractive
[X] Further cost cutting
WEAKNESSES
- -------------------------------------------------------------------------------
[X] Sustained recession in Japan resulting in:
-- Consumers being more selective in purchases and passing on high-ticket
items
-- Shrinking distributor force due to poor new application and renewal
rates
-- Foreign exchange fluctuations impacting gross margin as only partially
"hedged" and increased purchasing costs cannot be passed through to
consumers
[X] Suffers from poor public image of multi-level direct selling in general
[X] Distributor recruiting suffered particularly in last two years due to
debates in the Diet and pursuant attacks by JCIC and the press
[X] Juniper's complex distributor system inherently difficult to control
and monitor, exposing it to potential abuses
[X] Disproportionately dependent on a small number of distributor leaders
to run the network effectively
[X] High cost of sourcing from Ada, Michigan
THREATS
- -------------------------------------------------------------------------------
[X] Continued recessionary environment
[X] The current recession may have fundamentally altered consumer mentality
towards a more commoditized environment
[X] Increased competition from:
- -- New entrants in direct selling competing for distributors
- -- Consumer products manufacturers competing for end users
[X] Abuse by other direct selling companies tarnishing industry's, and
hence Juniper's, image
[X] Vulnerable to unexpected attacks by the public and any ensuing
regulatory tightening
[X] 3D Project would increase administration costs and product returns in
the short-term
[X] Continuing need to adapt business model to changes in environment
8
RECENT EVENTS
JUNIPER
[Annotated Share Price Graph]
THE DROP IN JUNIPER'S SHARE PRICE IS ATTRIBUTABLE TO THE IMPACT OF THE RECESSION
ON EARNINGS AND NEGATIVE PRESS
Source: Mueller; news runs
[GOLDMAN
SACHS LOGO]
9
SUMMARY OF HISTORICAL FINANCIALS [GOLDMAN
JUNIPER SACHS LOGO]
- -------------------------------------------------------------------------------
SALES
- -------------------------------------------------------------------------------
[GRAPH of 1995 - 2000E Sales and Year-on-Year Sales Growth]
1995 - 2000E CAGR: (3.4)%
- -------------------------------------------------------------------------------
GROSS PROFIT
- -------------------------------------------------------------------------------
[GRAPH of 1995 - 2000E Gross Profit and Gross Margin]
1995 - 2000E CAGR; (4.3)%
- -------------------------------------------------------------------------------
EBIT
- -------------------------------------------------------------------------------
[GRAPH of 1995 - 2000E EBIT and EBIT Margin]
1995 - 2000E CAGR; (20.9)%
- -------------------------------------------------------------------------------
NET INCOME
- -------------------------------------------------------------------------------
[GRAPH of 1995 - 2000E Net Income and Net Margin]
1995 - 2000E CAGR: (18.0)%
Source: 20-F, Juniper Management budget
10
SHARE PRICE HISTORY [GOLDMAN
JUNIPER SACHS LOGO]
- -------------------------------------------------------------------------------
SINCE IPO (a)
- -------------------------------------------------------------------------------
[GRAPH of closing stock price and volume traded]
- -------------------------------------------------------------------------------
THREE YEARS (b)
- -------------------------------------------------------------------------------
[GRAPH of closing stock price and volume traded]
- -------------------------------------------------------------------------------
ONE YEAR (c)
- -------------------------------------------------------------------------------
[GRAPH of closing stock price and volume traded]
- -------------------------------------------------------------------------------
SIX MONTHS (d)
- -------------------------------------------------------------------------------
[GRAPH of closing stock price and volume traded]
Source: NIKKEI's NEEDS - Database
(a) Plotted monthly from 4/30/1991 to 10/29/1999
(b) Plotted weekly from 11/1/1996 to 10/29/1999
(c) Plotted daily from 10/29/1998 to 10/29/1999
(d) Plotted daily from 4/29/1999 to 10/29/1999
11
SHARES TRADED AT VARIOUS PRICES(a)
JUNIPER
- -------------------------------------------------------------------------------
SINCE IPO (b)
- -------------------------------------------------------------------------------
[BAR CHART]
- -------------------------------------------------------------------------------
THREE YEARS (c)
- -------------------------------------------------------------------------------
[BAR CHART]
- -------------------------------------------------------------------------------
ONE YEAR (d)
- -------------------------------------------------------------------------------
[BAR CHART]
- -------------------------------------------------------------------------------
SIX MONTHS (e)
- -------------------------------------------------------------------------------
[BAR CHART]
% OF 1999 YTD TRADING VOLUME
[PIE CHART]
Source: NIKKEI's NEEDS - Database
(a) Japan OTC only
(b) From 4/30/1991 to 10/29/1999
(c) From 11/1/1996 to 10/29/1999
(d) From 10/29/1998 to 10/29/1999
(e) From 4/29/1999 to 10/29/1999
[Goldman Sachs Logo]
12
HISTORICAL RELATIVE STOCK PRICE PERFORMANCE [GOLDMAN SACHS LOGO]
JUNIPER
Asian Direct Marketing Index
- ----------------------------
Apple
Cosway
Mango
US Direct Marketing Index
- -------------------------
Avon
Herbalife
Nu Skin
Rexall Sundown
Thomas Nelson
Tupperware
Japanese Direct Marketing Index
- -------------------------------
Avon Japan
Ivy Cosmetics
Noevir
Shaklee Japan
Nikkei 225 Stock Average Close
- ------------------------------
Juniper
- -------
- -------------------------------------------------------------------------------
SINCE IPO (a)
- -------------------------------------------------------------------------------
[GRAPH of Asia Direct Marketing Index, US Direct Marketing Index, Japanese
Direct Marketing Index, Nikkei 225 Stock Average Close, and Juniper relative
price performance]
- -------------------------------------------------------------------------------
THREE YEARS (b)
- -------------------------------------------------------------------------------
[GRAPH of Asia Direct Marketing Index, US Direct Marketing Index, Japanese
Direct Marketing Index, Nikkei 225 Stock Average Close, and Juniper relative
price performance]
- -------------------------------------------------------------------------------
ONE YEAR (c)
- -------------------------------------------------------------------------------
[GRAPH of Asia Direct Marketing Index, US Direct Marketing Index, Japanese
Direct Marketing Index, Nikkei 225 Stock Average Close, and Juniper relative
price performance]
- -------------------------------------------------------------------------------
SIX MONTHS (d)
- -------------------------------------------------------------------------------
[GRAPH of Asia Direct Marketing Index, US Direct Marketing Index, Japanese
Direct Marketing Index, Nikkei 225 Stock Average Close, and Juniper relative
price performance]
Source: Mueller
(a) Plotted monthly from 4/30/1991 to 10/29/1999
(b) Plotted weekly from 11/1/1996 to 10/29/1999
(c) Plotted daily from 10/29/1998 to 10/29/1999
(d) Plotted daily from 4/29/1999 to 10/29/1999
13
Summary of Research Comments
Juniper
- -----------------------------------------------------------------------------------------------------------------------------------
Share
Date Company Price EPS Rating Comments
- -----------------------------------------------------------------------------------------------------------------------------------
10/15/1999 Merrill Lynch & Co (Yen)1,000 (Yen)60.00 Long Term |X| The closing number of distributors declined 3.9%
(FY2000E) Neutral YoY to 1.1mm. Management notes that new
sign-ups were depressed. This points to
Int. Term further earnings weakness
Reduce |X| Improved non-operating items and a lower tax
rate hold the decline in after-tax earnings to
18% or (Yen)10.5bn vs. our (Yen)9.0bn estimate
- -----------------------------------------------------------------------------------------------------------------------------------
7/2/1999 Merrill Lynch & Co (Yen)1,220 (Yen)60.00 Long Term |X| Cost cutting is improving earnings, but the
(FY2000E) Neutral revenue outlook remains depressed as long as
the number of distributors is still declining
Int. Term |X| Until this trend reverses, our investment
Reduce opinion remains Reduce
- ---------------- -------------------- ----------- ------------- ------------- ------------------------------------------------------
4/10/1999 Merrill Lynch & Co (Yen)1,160 (Yen)60.00 Long Term |X| Core distributors dropped 5% YoY to 984,000 vs.
(FY2000E) Neutral our estimated 950,000
Int. Term |X| AJL is feeling the negative impact of lower
Reduce consumption, fewer distributors and the dearth
of new products. We believe this situation is
likely to continue throughout this year
- -----------------------------------------------------------------------------------------------------------------------------------
11/5/1998 Merrill Lynch & Co (Yen)1,420 (Yen)97.00 Long Term |X| The 3D Project will remake Juniper's multi-layer
(FY2000E) Accumulate organization into a tighter ship and possibly a
more effective one
Int. Term |X| Although the EPS estimates for FY8/99 and FY8/00
Neutral are lower than the indicated dividend of (Yen)100,
dividend level should hold given the
significant cash position
|X| Our long-term investment opinion of Accumulate is
based on the thesis that the dividend would hold;
the implied dividend yield is 7%
[Goldman Sachs Logo]
14
MACROECONOMIC ENVIRONMENT(a)(b)
JAPAN
[GRAPH of Year-on-Year GDP and private consumption growth rates 1995 - 2003E]
(a) Years ending on March 31 following of the calendar years.
(b) All data plotted yearly.
Source: Historical data from Economic Planning Agency.
Estimates by GS Research (Sept. 17, 1999) and Japan Center for
Economic Research (Dec. 3, 1998).
[Goldman Sachs Logo]
15
OVERVIEW OF JAPANESE YEN EXCHANGE RATE HISTORY
YEN/$US
[GRAPH of Yen/$ US exchange rate 1997 - 2000E]
Source: Datastream (plotted daily from 1/01/1997 to 10/15/1999, projection by GS
Research (Sept. 28, 1999)
[Goldman Sachs Logo]
16
DISTRIBUTOR FORCE AND PRODUCTIVITY ANALYSIS [Goldman Sachs Logo]
JUNIPER
- -------------------------------------------------------------------------------
DISTRIBUTOR FORCE
- -------------------------------------------------------------------------------
[Graph of number of distributors, new applicants, and renewal rate 1994 - 1999]
- -------------------------------------------------------------------------------
DISTRIBUTOR PRODUCTIVITY
- -------------------------------------------------------------------------------
[Graph of sales per distributor and ratio of new applicants 1994 - 1999]
Source: Juniper
17
TAB 3
18
COMPARISON OF SELECTED COMPANIES [Goldman Sachs Logo]
DIRECT SALES
(US$ IN MILLIONS, EXCEPT PER SHARE DATA)
MARKET DATA AS OF 11/10/99
- --------------------------------------------------------------------------------------------------------------------------------
BASIC ENTERPRISE VALUE
% OF 3 EQUITY LEVERED LTM MARGINS (b) MULTIPLES OF LTM (b)
COMPANY % OF 52 YEAR HIGH MARKET MARKET ----------------------- ------------------------
WEEK HIGH PRICE CAP CAP EBITDA EBIT SALES EBITDA EBIT
- --------------------------------------------------------------------------------------------------------------------------------
JUNIPER (a) 68.3% 20.5% $ 1,324 $ 1,118 15.5% 14.1% 0.8X 5.3 5.8X
US DIRECT SALES COMPANIES
Avon (d) 51.2 51.2 7,498 7,941 13.4 11.9 1.5 11.3 12.7
Nu Skin 43.4 35.4 361 349 20.7 16.8 0.4 1.8 2.3
Tupperware (e) 73.8 34.4 1,084 1,417 17.5 11.5 1.3 7.7 11.7
Thomas Nelson 70.5 63.7 140 237 12.1 8.7 0.9 7.4 10.3
Herbalife 87.3 36.4 381 273 5.2 4.2 0.2 3.1 3.8
Rexall Sundown 48.2 28.3 704 713 19.6 17.5 1.2 6.2 6.9
Nature's Sunshine 39.8 24.7 124 99 13.6 11.8 0.3 2.5 2.9
USANA 41.0 32.4 94 92 15.8 13.2 0.8 5.1 6.0
- --------------------------------------------------------------------------------------------------------------------------------
MEAN 14.7% 12.0% 0.8X 5.6X 7.1X
MEDIAN 14.7 11.9 0.8 5.6 6.5
- --------------------------------------------------------------------------------------------------------------------------------
ASIAN DIRECT SALES COMPANIES
Apple (a) 80.1 23.4 653 545 7.8 5.2 1.1 13.9 20.7
Cosway Corp. Berhad 63.4 34.0 163 410 7.8 5.3 1.1 14.3 21.0
Mango 95.4 52.5 244 243 14.2 13.6 2.9 20.7 21.6
- --------------------------------------------------------------------------------------------------------------------------------
MEAN 9.9% 8.0% 1.7X 16.3X 21.1X
MEDIAN 7.8 5.3 1.1 14.3 21.0
- --------------------------------------------------------------------------------------------------------------------------------
JAPANESE DIRECT SALES COMPANIES
Avon Japan 73.7 62.3 144 140 4.1 1.8 0.5 11.5 26.4
Ivy Cosmetics 68.1 59.1 41 32 19.8 16.7 0.6 3.0 3.6
Noevir 69.0 41.9 400 280 7.4 4.1 0.7 10.1 18.4
Shaklee Japan 80.6 54.9 238 170 13.7 13.6 1.5 10.6 10.7
- --------------------------------------------------------------------------------------------------------------------------------
MEAN 11.2% 9.0% 0.8X 8.8X 14.8X
MEDIAN 10.6 8.8 0.7 10.4 14.6
- --------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------
CALENDARIZED
P/E
MULTIPLES (c) 5-YR EST.
COMPANY ---------------- EPS P/E TO GROWTH DIVIDEND
2000E 2001E GROWTH (c)(f) 2000E 2001E YIELD ROCE
- -------------------------------------------------------------------------------------------------------------
JUNIPER (a) 16.2X 15.3X 2.0% 8.1X 7.7X 10.3% 17.8%
US DIRECT SALES COMPANIES
Avon (d) 15.5 12.6 14.0 1.1 0.9 2.5 1.9
Nu Skin 8.5 7.1 20.0 0.4 0.4 N.A. 42.4
Tupperware (e) 10.8 9.7 11.0 1.0 0.9 4.7 55.6
Thomas Nelson 10.2 9.1 12.5 0.8 0.7 1.6 8.1
Herbalife 8.1 N.A. N.A. N.A. N.A. 4.5 25.8
Rexall Sundown 10.0 1.5 15.0 0.7 0.1 N.A. 28.3
Nature's Sunshine 6.5 5.7 N.A. N.A. N.A. 1.8 29.9
USANA 11.2 8.2 N.A. N.A. N.A. N.A. 35.0
- -------------------------------------------------------------------------------------------------------------
MEAN 10.1X 7.7X 14.5% 0.8X 0.6X 3.0% 28.4%
MEDIAN 10.1 8.2 14.0 0.8 0.7 2.5 29.1
- -------------------------------------------------------------------------------------------------------------
ASIAN DIRECT SALES COMPANIES
Apple (a) 46.3 12.5 17.5 2.6 1.0 N.A. 8.5
Cosway Corp. Berhad N.A. N.A. N.A. N.A. N.A. 1.6 (0.3)
Mango 19.2 15.9 6.0 3.2 2.7 2.7 18.5
- -------------------------------------------------------------------------------------------------------------
MEAN 32.7X 16.9X 11.8% 2.9X 1.8X 2.2 % 8.9%
MEDIAN 32.7 16.9 11.8 2.9 1.8 2.2 8.5
- -------------------------------------------------------------------------------------------------------------
JAPANESE DIRECT SALES COMPANIES
Avon Japan 30.4 N.A. N.A. N.A. N.A. 2.8 5.0
Ivy Cosmetics 8.7 N.A. 15.0 0.6 N.A. 1.8 9.7
Noevir 32.5 N.A. 17.6 1.8 N.A. 1.7 3.0
Shaklee Japan 29.1 N.A. 2.0 14.6 N.A. 3.1 6.4
- -------------------------------------------------------------------------------------------------------------
MEAN 25.2X N.M. 11.5% 5.7X N.M. 2.3% 6.0%
MEDIAN 29.8 N.M. 15.0 1.8 N.M. 2.3 5.7
- -------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------
5-YR NON-US SALES ASIAN AS
COMPANY SALES AS % OF % OF TOTAL
CAGR TOTAL SALES
- -------------------------------------------------------------------------
JUNIPER (a) (1.8)% 100.0 % 100.0%
US DIRECT SALES COMPANIES
Avon (d) 6.3 60.7 12.4
Nu Skin 52.5 99.1 88.2
Tupperware (e) (1.6) 84.8 21.1
Thomas Nelson 12.8 N.A. N.A.
Herbalife 18.9 70.7 43.8
Rexall Sundown 41.6 N.A. N.A.
Nature's Sunshine 18.4 36.8 3.7
USANA 99.3 45.1 16.2
- -------------------------------------------------------------------------
MEAN 31.0% 66.2% 30.9%
MEDIAN 18.6 65.7 18.7
- -------------------------------------------------------------------------
ASIAN DIRECT SALES COMPANIES
Apple (a) (3.9)
Cosway Corp. Berhad 16.4
Mango 9.4
- -------------------------------------------------------------------------
MEAN 7.3%
MEDIAN 9.4
- -------------------------------------------------------------------------
JAPANESE DIRECT SALES COMPANIES
Avon Japan 8.6
Ivy Cosmetics 1.9
Noevir (3.4)
Shaklee Japan (4.8)
- -------------------------------------------------------------------------
MEAN 0.6%
MEDIAN (0.8)
- -------------------------------------------------------------------------
(a) Financial Statement data as of 08/31/1999.
(b) Financial statement data as of latest twelve months available.
(c) Source: IBES estimates as of 11/10/99. Asia and Japan marketing
companies not calendarized.
(d) Excludes $105.2m and $70.5m in restructuring charges in 1999 & 1998
respectively.
(e) Excludes $15m re-engineering charge in 1998.
(f) Juniper growth estimate from Merrill Lynch Report dated 10/15/1999.
19
SELECTED PERFORMANCE BENCHMARKS [Goldman Sachs Logo]
DIRECT MARKETING COMPANIES
- -------------------------------------------------------------------------------
HISTORICAL SALES GROWTH 5 YEAR CAGR
- -------------------------------------------------------------------------------
[GRAPH]
- -------------------------------------------------------------------------------
LTM GROSS AND EBIT MARGIN
- -------------------------------------------------------------------------------
[GRAPH]
- -------------------------------------------------------------------------------
PROJECTED 5 YEAR EPS GROWTH RATE
- -------------------------------------------------------------------------------
[GRAPH]
- -------------------------------------------------------------------------------
LTM RETURN ON COMMON EQUITY
- -------------------------------------------------------------------------------
[GRAPH]
Source: Historical figures from company reports;
projected 5 year EPS growth rates from IBES
20
JUNIPER HISTORICAL PUBLIC MARKET VALUATION PERFORMANCE [Goldman Sachs Logo]
EV MULTIPLE OF TRAILING EBIT (a)
[GRAPH]
ONE YEAR FORWARD P/E MULTIPLE (b)
[GRAPH]
DIVIDEND YIELD (c)
[GRAPH]
Source: Factset
(a) Multiple of immediately proceeding fiscal year EBIT. Weekly closing price,
except current week for close November 10, 1999.
(b) IBES one year forward EPS estimates. Weekly closing price, except current
week for close November 10, 1999.
(c) In JPY yield. Weekly closing price, except current week for close November
10, 1999.
21
FUTURE TRADING RANGE ANALYSIS [Goldman Sachs Logo]
JUNIPER
[GRAPH]
Source: EPS projections from Juniper management.
22
FUTURE TRADING RANGE SENSITIVITY ANALYSIS (a)
JUNIPER
HYPOTHETICAL SHARE PRICE TODAY IF EXIT IN 4 YEARS AT:
VARIOUS EXIT FORWARD P/E MULTIPLES AND EXPECTED RETURNS (b)
--------------------------------------------------------------
EXIT FWD P/E MULTIPLE IN 4 YEARS
--------------------------------------------------------------
6x 11x 16x 21x 26x
--------------------------------------------------------------
12.0% 387 709 1,031 1,353 1,676
Expected 10.0% 416 763 1,110 1,456 1,803
Equity 8.0% 448 822 1,196 1,569 1,943
Return 6.0% 484 887 1,290 1,694 2,097
4.0% 523 959 1,395 1,830 2,266
VARIOUS INCREMENTAL FY2004E EPS AND EXPECTED RETURNS (b)(c)
------------------------------------------------
INCREMENTAL FY2004E EPS
--------------------------------------------------------------
(20.0)% (10.0)% 0.0% 10.0% 20.0%
--------------------------------------------------------------
12.0% 825 928 1,031 1,134 1,237
Expected 10.0% 888 999 1,110 1,221 1,332
Equity 8.0% 957 1,076 1,196 1,315 1,435
Return 6.0% 1,032 1,161 1,290 1,419 1,549
4.0% 1,116 1,255 1,395 1,534 1,674
(a) Asumes expected return for shareholders comprise dividend yield and share
price appreciation
(b) Assumes 2% dividend yield, consistent with dividend yield of selected
comparable publicly listed companies
(c) Assumes 16x forward P/E at time of exit
Source: FY2004E forecasts from Juniper management
[Goldman Sachs Logo]
23
TAB 4
24
MH MILLENNIUM ACQUISITION OF HERBALIFE
SEPTEMBER 17, 1999
Background (a)
- --------------------------------------------------------------------------------
- - MH Millennium Acquisition, a subsidiary of MH Millennium Holdings, tendered
for all outstanding shares of Herbalife it does not already own. The Tender
was effective on September 17, 1999 until October 15, 1999, however was
extended at the same price until November 24, 1999. The initial proposal of
$12.50 on August 11, 1999 was rejected by the Special Committee as being
unfair
- - The purchaser is the Company's founder, CEO, President and Chairman Mark
Hughes, who owns 100% of MH Millennium Holdings which beneficially owns
55.4% and 59.0% of outstanding Herbalife Class A and B Shares respectively
- - Herbalife is a network marketing company that sells a wide range of weight
management products, food and dietary products worldwide. Number of
worldwide distributors is 750,000. Japan accounted for 32% of 1998 sales
- - The motive for transaction was the deterioration in Herbalife's share
price, which was considered undervalued by the Company. Management wanted
the freedom to invest in long-term markets
- - Marketplace reaction (b): "Institutional shareholders who stood by founder
Mark Hughes . . . are crying foul over his plan to take the company
private." "I think the $17 price is ridiculous. The only ones making money
on this stock are insiders." - Richard Todaro, Kennedy Capital Management
Transaction Summary (a)
- --------------------------------------------------------------------------------
Current Price of Tender: $17.00 Initial Price (non-public): $12.50
# of Shares Tendered for: Class A: 4.3m Class B: 7.3m
% of Total Shares O/S 42.9% 39.5%
Transaction Size (c): ($) 267.8m
Implied Equity Consideration (c): ($) 543.0m
Implied Enterprise Value (c) (d): ($) 415.5m
Multiple of Premium (Class A/B)
- -------------------------------------- --------------------------------------
LTM Retail Sales: 0.2x 1 Day Prior: 39/84%
LTM EBIT: 5.0x 52 wk High: (41)/(38)%
LTM Net Income: 10.7x 52 wk Low: 127/183%
2000E Net Income (e) 10.3x
Summary Financials (a)
Financial Year ended December 31,
- -------------------------------------------------------------------------------
(US$mm) 1997 1998 LTM 9/1999
===============================================================================
Retail Sales 1,490.7 1,644.8 1,746.1
Y-on-Y Growth (%) 24.2 10.3 7.6
Gross Profit 1,285.6 1,414.0 1,501.6
Gross Margin (%) 86.2 85.97 86.0
EBIT 86.0 78.3 83.0
Margin (%) 5.8 4.8 4.8
Net Income 54.7 48.5 50.8
Margin (%) 3.7 3.0 2.9
Net Debt (118.6) (100.9) (129.5)(d)
Fully Diluted EPS 1.72 1.60 1.30
5 Year Share Price Performance (f)
- --------------------------------------------------------------------------------
[GRAPH]
(a) Source: Company filings (10K, 10Q, SC 14D1, LTM from unaudited company
release).
(b) Source: LA Times dated September 16,1999.
(c) Includes purchase of options.
(d) Net debt from 6/1999 10-Q, latest available.
(e) IBES Estimates.
(f) Source: Muller.
25
INDUSTRI KAPITAL & JOCHNICK FAMILY ACQUISITION OF ORIFLAME
SEPTEMBER 7, 1999
Background
- --------------------------------------------------------------------------------
- - MBO bid by Oriflame Trading, a unit of Oriflame International will lead to
control by both the Industri Kapital Group and the Jochnick family. The two
groups launched a tender offer for 49.73m shares at 265p for a 27.7%
premium on the undisturbed market price. The stock delisted from the LSE on
10/14/1999
- - The bidders are the founding Jochnick family and the Anglo-Swedish private
equity group, Industri Kapitol. Each will own 50% of the ensuing privately
held corporation
- - A strong motivating factor for the tender offer was the need for the family
to be able to build a strong distribution system in those countries where
the economy was in depression
- - Oriflame International is a direct seller in 52 countries with over 750,000
distributors. It is one of the leading direct selling cosmetics companies
in the world. Oriflame utilizes retail outlets and pharmacies for some of
its brand name items
- - Oriflame has limited exposure to Asian Pacific countries, with a
distributor sales force only in Malaysia and Indonesia. Shelved plans to
grow presence in Asia until economic upturn begins
Transaction Summary (a)(b)
- --------------------------------------------------------------------------------
Price: 265p
# of Shares Tendered for: 49.7m
% of Total Shares O/S 50.1%
Transaction Size: (GBP) 131.8m
Implied Equity Consideration: (GBP) 265.5m
Implied Enterprise Value: (GBP) 290.1m
Multiple of Latest FYE Premium
- -------------------------------------- --------------------------------------
Sales: 1.2x Undisturbed Price: 28%
EBIT: 9.6x 52 wk High: 0%
Net Income: 15.8x 52 wk Low: 121%
2000E Net Income: 12.6x
Financials (c)
- -------------------------------------------------------------------------------
Fiscal Year Ending Dec. 31,
===============================================================================
(GBPmm) 1997 1998
- --------------------------------------------------------------------------------
Sales 252.8 233.1
Y-on-Y Growth (%) 9.2 (7.8)
Gross Profit 176.6 162.3
Gross Margin (%) 69.9 69.6
EBIT 43.0 30.2
Margin (%) 17.0 13.0
Net Income 32.0 16.8
Margin (%) 12.7 7.2
Net Debt 3.1 24.7
EPS (Fully Diluted) 30.9 16.5
5 Year Share Price Performance (d)
- --------------------------------------------------------------------------------
[GRAPH]
(a) All data in UK Pounds except per share, which is in pence; FDSO = 100.17MM
(b) IBES estimates.
(c) Financial data based on company reports as of calendar year end; 1998
before discontinued operations; 1997 before merger costs; LTM not
meaningful due to insufficient disclosure of interim effects of
discontinued operations
(d) Source: Mueller.
(e) Bloomberg.
26
AVON INTERNATIONAL OPERATIONS TOB FOR AVON PRODUCTS
SEPTEMBER 14, 1992
Background
- - On September 14, 1992, Avon International Operations Inc., a subsidiary of
Avon (US), commenced a TOB to acquire shares it did not already own in Avon
Products Co., Ltd.
- - The buyer already held 60% of the outstanding common stock in Avon Products
Co., Ltd.
- - Although the purchase price was set at a 20% premium to the market price,
Avon International Operations Inc. was able to purchase only 5,757,000
shares, or approximately 42% of the shares it had tendered for
- - The primary reason for the lack of success was that many of the investors
had initially bought into the stock at prices significantly higher than the
offer price
Transaction Summary (a)
- --------------------------------------------------------------------------------
(Yen mm)
Offer Price: (Yen)560
# of Shares Tendered for: 13.6m (up to 20m)
% of Total Shares O/S: 20% (up to 29.4%)
Transaction Size: (Yen)7,616m
Implied Equity Consideration: (Yen)38,080m
Implied Enterprise Value: (Yen)47,891m
Multiple of Premium
- -------------------------------------- --------------------------------------
FY 1991 Sales (x): 1.1x 1 Day Prior: 19.1%
FY 1991 EBIT: 12.9x 52 wk High: (27.9)%
FY 1991 Net Income: 24.7x 52 wk Low: 60.0%
FY 1992E Net Income: 22.4x
Summary Financials (a)
- --------------------------------------------------------------------------------
((Yen)MM) 11/1990 11/1991
- --------------------------------------------------------------------------------
Sales 39,382 40,885
Y-on-Y Growth (%) (1.9) (3.8)
Gross Profit 7,809 8,101
Margin (19.8) (19.8)
EBIT 3,685 3,708
Margin (9.4) (9.1)
Net Income 2,041 1,542
Margin (5.2) (3.8)
Net Debt 11,630 9,811
EPS 15.02 11.35
5 Year Share Price Performance (b)
- --------------------------------------------------------------------------------
[GRAPH]
(a) Source: SDC, Japan Company Handbook, company disclosure material.
(b) Source: Nikkei-Needs Database.
27
TAB 5
28
PREMIA PAID IN SELECTED JAPANESE TENDER OFFERS
ANNOUNCEMENT TARGET BUYER OFFER PRICE PREMIUM*
- ------------------------------------------------------------------------------------------------------------
9/9/1999 Toho Rayon Teijin 7.8%
2/16/1999 Apollo Electronics Rohm 44.1%
11/10/1998 Komatsu Zenoah Komatsu 23.0%
11/2/1998 Torii Pharmaceutical Japan Tabacco 7.2%
10/16/1998 Tensho Electric Sanko 95.2%
8/31/1998 Daihatsu Co., Ltd. Toyota Motor Corp. 6.8%
4/21/1998 Japan Marine Technologies Ltd. TI Group PLC 56.8%
- ------------------------------------------------------------------------------------------------------------
4/17/1998 NCR Japan Ltd. NCR Holdings Ltd. 26.5%
- ------------------------------------------------------------------------------------------------------------
4/2/1998 Biotech K.K. Showa Denko K.K. 3.3%
11/26/1997 Unidux corp. Kanematsu Corp. 72.8%
9/24/1996 Royal Electric Co., Ltd. Ono Warehouse Co., Ltd. 14.0%
3/23/1993 Sakura Rubber Co., Ltd. Management 4.7%
Average 30.2%
Median 18.5%
* Premium over closing price 1 day prior to announcement.
Source: Press reports
29
PREMIA PAID IN RECENT ASIAN TENDER OFFERS
INCLUDES AUSTRALIA AND NEW ZEALAND (a)(b)(c)
[Mean: 23.0%]
[Median: 18.2%]
[GRAPH]
(a) Australia and New Zealand represent 75.6% of total deals.
(b) Premiums calculated to closing price 1 day prior to announcement.
(c) For deals where data available.
Source: SDC; last 5 years
[GOLDMAN SACHS LOGO]
30
PREMIA PAID IN RECENT ASIAN TENDER OFFERS
EXCLUDES AUSTRALIA AND NEW ZEALAND (a)(b)(c)
[Mean: 8.6%]
[Median: 6.1%]
[GRAPH]
(a) Includes India, Indonesia, Hong Kong, Malaysia, Philippines,
Singapore and Thailand.
(b) Premiums calculated to closing price one day prior to announcement.
(c) For deals where data available.
Source: SDC; last 5 years.
[GOLDMAN SACHS LOGO]
31
PREMIA PAID IN RECENT US TENDER OFFERS (a) (b)
[Mean: 29.2%]
[Median: 33.5%]
[GRAPH]
(a) Premium calculated to closing price 1 day prior to announcement.
(b) For deals where data available.
Source: SDC; all US tender offers launched since 10/1994
[GOLDMAN SACHS LOGO]
32
[GOLDMAN SACHS LOGO]
COMPARISON OF SELECTED MINORITY BUYOUTS (a)
Premium of Initial vs. Closing Premium of Final Price
Stock Price One Day Prior to Percent Increase in vs. Closing Stock Price
Announcement Final Price vs. Initial Bid One Day Prior to Announcement
[Mean: 17.4]% [Mean: 10.9%] [Mean: 26.0%]
[Median: 14.3%] [Median: 8.5%] [Median: 21.4%]
[Herbalife A: 2.0%(b)] [Herbalife A: 36.0%] [Herbalife: 38.8%]
[Herbalife B: 35.1%(b)] [Herbalife B: 36.0%] [Herbalife: 83.8%]
[GRAPH] [GRAPH] [GRAPH]
(a) Represents transactions in excess of $100 million from 1989 to 1999 where
the acquiror had in excess of approximately 50% ownership prior to
transaction and increased to 100% ownership.
(b) Based on offer price of $12.50 per share. This initial offer was non-public.
(c) Based on offer price of $17 per share.
Source: SDC
33
TAB 6
34
JUNIPER DISCOUNTED CASH FLOW ANALYSIS
KEY ASSUMPTIONS
- - All financial projections have been provided by Juniper management
- - The projections have been updated in October to reflect the current outlook
for the company
- - FY2000 figures have been produced on a bottom-up, product-by-product, cost
item-by-cost item basis according to the annual budgeting process
- - FY2001-FY2004 figures are produced by extrapolating FY2000, using
year-on-year net sales growth and margin ratios as key drivers
- - FY2000-FY2004 figures reflect the following:
- Negative impact of recession and adverse publicity since 1997 bottoming
out in 1999 and recovery thereafter
- Net sales showing steady growth at 4.0% CAGR but still 14% down on 1997
levels in 2004
- JPY120/US$ in first part of 2000 and JPY110/US$ kept constant
thereafter. Gross margin 69.9% in 2000 and 69% flat thereafter
- Margins altered in 2000 to reflect introduction of 3D Project and
transfer of magazine publishing costs from COS to SG&A. EBIT margin
improvement from 10.3% in 2000 to 14.1% in 2004 reflects the fact that
approximately 50% of SG&A and 40% of Distribution Expenses are fixed
costs
- Effective tax rate reduction in 2000 reflects cuts in Japanese corporate
tax rate; kept constant thereafter
- No significant capex assumed beyond recurring maintenance items (HQ and
distribution centers) and minor internet investment
- Working capital requirement largely flat
35
JAPAN ECONOMIC OUTLOOK
FACTORS OF RECOVERY
- -------------------
- - "The possibility of a self-sustaining, private sector demand-led recovery is
now in sight" (a)
- Conventional economic statistics have underestimated consumption in
areas such as cellular phones, internet usage, PCs, etc. --- growth of
which has been supported to a great extent by female demand
- The GS Research team recently raised its real GDP growth outlook for
fiscal 1999 and 2000 to 1.2% and 0.8%, respectively
- Impact of the yen appreciation should be mitigated by the progress made
by Japanese manufacturers in shifting production overseas and
restructuring, and the current environment of general economic expansion
at home and abroad
- - Restructuring-driven earnings rebound can be expected
- The GS Research team expects full-year 1999 recurring profits to grow
13.3%
- The emergence of the proposed "MegaBank" should serve as a catalyst for
more aggressive corporate restructuring, particularly in sectors such as
chemicals, steel, shipbuilding and oil
- Recently approved industrial revitalization measures such as share
exchange schemes should facilitate increased corporate reorganization
and M&A activity
RISKS AND THREATS
- -----------------
- - A sharper rise in yen than anticipated
- The corporate earnings forecast by the GS research already factors in
three-month and six-month currency forecasts of (Yen) 103/US$ and
(Yen) 93/US$, respectively
- However, a yen appreciation sharper than expected will dampen the
economy through reductions in exports and capital investment
- - An earlier-than expected termination of the BOJ's zero interest rate policy
instigated by the continued momentum in the economy would also prove
negative through pushing down profits of certain highly leveraged firms
Source: GS Research
(a) "The Bull Story: It's Only Just Begun," Oct. 7, 1999
36
JUNIPER DISCOUNTED CASH FLOW ANALYSIS
MANAGEMENT CASE
(JPY IN MILLIONS)
AUGUST 31,
2000-2004
1997A 1998A 1999A 2000E 2001E 2002E 2003E 2004E CAGR
----- ----- ----- ----- ----- ----- ----- ----- ---------
NET SALES 203,362 192,458 143,797 150,000 156,000 162,240 168,730 175,479 4.0%
Total Cost of Sales (57,278) (62,178) (47,738) (45,138) (48,360) (50,294) (52,306) (54,398) 4.8%
------------------------------------------------------------------------------------------------------
GROSS PROFIT 146,083 130,280 96,060 104,862 107,640 111,946 116,424 121,081 3.7%
---------------------------------------------------------------------------------------------
Total Operating Expenses (98,236) (99,853) (75,798) (89,452) (87,785) (90,537) (93,398) (96,374) 1.9%
------------------------------------------------------------------------------------------------------
EBIT 47,848 30,427 20,261 15,410 19,855 21,409 23,026 24,707 12.5%
Taxes (28,030) (16,950) (10,500) (6,935) (8,935) (9,634) (10,362) (11,118) 12.5%
------------------------------------------------------------------------------------------------------
EBIAT 19,818 13,477 9,761 8,475 10,920 11,775 12,664 13,589 12.5%
add: Depreciation 1,650 2,046 1,956 2,841 2,850 2,850 2,850 2,850
add: Decrease in WC (13,337) (7,881) (5,426) (2,731) (328) 507 772 466
less: CapEx (8,254) (1,143) (10,431) (5,916) (1,804) (1,804) (1,804) (1,804)
UNLEVERED FREE CASH FLOW (123) 6,499 (4,139) 2,669 11,638 13,328 14,482 15,101 54.2%
Net Sales Growth (5.4)% (25.3)% 4.3% 4.0% 4.0% 4.0% 4.0%
Gross Margin 71.8% 67.7% 66.8% 69.9% 69.0% 69.0% 69.0% 69.0%
EBIT Margin 23.5% 15.8% 14.1% 10.3% 12.7% 13.2% 13.6% 14.1%
Depreciation/Sales 0.8% 1.1% 1.4% 1.9% 1.8% 1.8% 1.7% 1.6%
CapEx/Dep 5.0x 0.6x 5.3x 2.1x 0.6x 0.6x 0.6x 0.6x
Source: Juniper management projections
[Goldman Sachs Logo]
37
JUNIPER DISCOUNTED CASH FLOW ANALYSIS
MANAGEMENT CASE
(JPY IN MILLIONS EXCEPT PER SHARE DATA)
AUGUST 31,
2000E 2001E 2002E 2003E 2004E
----- ----- ----- ----- -----
UNLEVERED FCF (a) 2,669.0 11,638.3 13,328.4 14,482.1 15,101.4
NPV (b) 46,118.0 26%
PV OF TERMINAL VALUE (c) 132,328.2 74%
---------
ENTERPRISE VALUE 178,446.2
LESS: NET DEBT (d) (21,748.0)
----------
EQUITY VALUE 200,194.2
PER SHARE (e) 1,390
(a) Projections from Juniper management.
(b) Assumes mid-year discounting convention; discounted to November 30, 1999.
Assumes discount rate of 8.0%.
(c) Terminal Value calculated using multiple of LTM EBIT (7.5x).
(d) As of August 31, 1999.
(e) Assumes 144.0MM shares outstanding.
[GOLDMAN SACHS LOGO]
38
JUNIPER DISCOUNTED CASH FLOW ANALYSIS
SENSITIVITY ANALYSIS (a)
(JPY TO MILLIONS, EXCEPT PER SHARE DATA)
FINANCIAL SENSITIVITIES
ENTERPRISE VALUE
TERMINAL MULTIPLE OF 2004E EBIT
-----------------------------------------------
5.5 X 6.5 X 7.5 X 8.5 X 9.5 X
-----------------------------------------------
DISCOUNT RATE 6.0% 153,869 173,016 192,164 211,311 230,458
7.0% 148,386 166,762 185,139 203,515 221,892
8.0% 143,159 160,802 178,446 196,090 213,734
9.0% 138,174 155,121 172,067 189,014 205,960
10.0% 133,418 149,701 165,964 182,267 198,549
EQUITY VALUE PER SHARE (b)(c)
TERMINAL MULTIPLE OF 2004E EBIT
---------------------------------------------
5.5 X 6.5 X 7.5 X 8.5 X 9.5 X
---------------------------------------------
DISCOUNT RATE 6.0% 1,219 1,352 1,485 1,618 1,751
7.0% 1,181 1,309 1,436 1,564 1,692
8.0% 1,145 1,267 1,390 1,512 1,635
9.0% 1,110 1,228 1,346 1,463 1,581
10.0% 1,077 1,190 1,303 1,417 1,530
BUSINESS SENSITIVITIES
ENTERPRISE VALUE (d)
CHANGE IN SALES GROWTH
-----------------------------------------------
-3.0% -1.5% 0.0% 1.5% 3.0%
-----------------------------------------------
CHANGE IN -1.0% 144,698 154,726 165,326 176,523 188,341
EBIT MARGIN 0.0% 156,222 167,026 178,446 190,508 203,240
1.0% 167,746 179,327 191,566 204,494 218,138
2.0% 179,271 191,627 204,686 218,479 233,037
3.0% 190,795 203,927 217,806 232,465 247,936
EQUITY VALUE PER SHARE (b)(c)(d)
CHANGE IN SALES GROWTH
---------------------------------------------
-3.0% -1.5% 0.0% 1.5% 3.0%
-----------------------------------------------
CHANGE IN -1.0% 1,156 1,225 1,299 1,377 1,459
EBIT MARGIN 0.0% 1,236 1,311 1,390 1,474 1,562
1.0% 1,316 1,396 1,481 1,571 1,666
2.0% 1,396 1,482 1,572 1,668 1,769
3.0% 1,476 1,567 1,663 1,765 1,872
(a) Based on Juniper management base case projections as of October, 1999;
figures discounted to end of November 1999.
(b) Assumes net debt of (Yen)(21,748) million as of November, 1999.
(c) Assumes 144.0 million primary shares outstanding.
(d) Assumes a 8.0% discount rate and a 7.5x EBIT terminal multiple.
39
TAB A
40
JUNIPER HISTORICAL FINANCIAL OVERVIEW
PROFIT AND LOSS STATEMENT
(JPY IN MILLIONS)
YEARS ENDED AUGUST 31,
1994 1995 1996 1997 1998
-------- -------- -------- -------- --------
Total Net Sales 157,556 177,991 212,196 203,362 192,458
Cost of Sales 43,576 47,515 55,588 57,279 62,178
-----------------------------------------------------------------------------
Gross Profit 113,980 130,476 156,608 146,083 130,280
Operating Expenses
Distributor Incentives 42,652 47,885 57,044 56,904 57,781
Distribution Expenses 8,324 8,853 9,839 11,173 10,783
Total Selling & Administrative 19,616 24,022 28,355 30,158 31,289
-----------------------------------------------------------------------------
Total Operating Expenses 70,592 80,760 95,238 98,235 99,853
-----------------------------------------------------------------------------
Operating Profit 43,388 49,716 61,370 47,848 30,427
Other Income (Net) 2,557 1,733 1,309 3,299 (698)
-----------------------------------------------------------------------------
Income Before Income Taxes 45,945 51,449 62,679 51,147 29,729
-----------------------------------------------------------------------------
Net Income 20,604 23,062 28,081 23,117 12,779
Basic Earnings Per Share 138 154 189 159 89
Dividends Per Share 140 190 125 100 100
COMMON SIZE ANALYSIS
Cost of Sales 27.7% 26.7% 26.2% 28.2% 32.3%
Gross Profit 72.3% 73.3% 73.8% 71.8% 67.7%
EBIT Margin 27.5% 27.9% 28.9% 23.5% 15.8%
Net Income 13.1% 13.0% 13.2% 11.4% 6.6%
YEAR-ON-YEAR GROWTH RATES
Net Sales 13.0% 19.2% -4.2% -5.4%
Net Income 11.9% 21.8% -17.7% -44.7%
Source: 20-F
YEARS ENDED AUGUST 31,
CAGR
1999 94-99
-------- -------
Total Net Sales 143,797 -1.8%
Cost of Sales 47,738 1.8%
-------- -------
Gross Profit 96,059 -3.4%
Operating Expenses
Distributor Incentives 41,350 -0.6%
Distribution Expenses 8,278 -0.1%
Total Selling & Administrative 26,170 5.9%
-------- -------
Total Operating Expenses 75,798 1.4%
-------- -------
Operating Profit 20,261 -14.1%
Other Income (Net) 746 -21.8%
-------- -------
Income Before Income Taxes 21,007 -14.5%
-------- -------
Net Income 10,507 -12.6%
Basic Earnings Per Share 73 -11.9%
Dividends Per Share 100 -6.5%
COMMON SIZE ANALYSIS
Cost of Sales 33.2%
Gross Profit 66.8%
EBIT Margin 14.1%
Net Income 7.3%
YEAR-ON-YEAR GROWTH RATES
Net Sales -25.3%
Net Income -17.8%
Source: 20-F
41
JUNIPER HISTORICAL FINANCIAL OVERVIEW
CASH FLOW STATEMENT
(JPY IN MILLIONS)
YEARS ENDED AUGUST 31,
1994 1995 1996 1997 1998 1999
-------- -------- --------- --------- --------- ---------
Operating Activities
Net Income 20,604 23,062 28,081 23,117 12,779 10,507
Adjustments
Depreciation and Amort. 1,177 1,435 1,128 1,650 2,046 1,955
Other 7,043 6,708 5,936 (15,709) (7,661) (5,309)
Net Cash from
Operating Activities 28,824 31,205 35,145 9,058 7,164 7,153
Investing Activities
Purchase of PPE (961) (25,174) (5,359) (8,254) (1,143) (10,431)
(Inc)/Dec in Short-Term
Investments (a) (21,078) 692 29,856 (11,295) (1,710) 1,876
Other 1,948 (448) (622) 4,279 45 1,311
Net Cash from Investing
Activities (20,091) (24,930) 23,875 (15,270) (2,808) (7,244)
Financing Activities
Cash Dividends Paid (13,466) (26,183) (25,436) (14,682) (14,415) (14,421)
Repurchase of Common
Stock (15,000) (8,888) (826)
Net Cash from Financing
Activities (13,466) (26,183) (40,436) (23,570) (15,241) (14,421)
Net Increase (Decrease) in
Cash and Cash Equivalents (4,733) (19,908) 18,584 (29,782) (10,885) (14,512)
Cash and Cash Equivalents,
Beginning 66,281 61,548 41,640 60,224 30,442 19,557
Cash and Cash Equivalents,
End 61,548 41,640 60,224 30,442 19,557 5,045
(a) Net cash flow from change in investment funds and short-term investments
Source: 20-F
42
JUNIPER HISTORICAL FINANCIAL OVERVIEW
BALANCE SHEET
(JPY IN MILLIONS)
YEARS ENDED AUGUST 31,
1994 1995 1996 1997 1998 1999
--------- --------- -------- --------- -------- ---------
Current Assets
Cash and Cash Equivalents 61,548 41,640 60,224 30,442 19,557 5,045
Investments (a) 29,690 31,997 4,357 16,053 17,529 16,703
Inventory 10,936 11,397 12,476 16,707 16,640 9,191
Other Current Assets 4,042 2,460 2,303 5,577 6,054 5,938
Total Current Assets 106,216 87,494 79,360 68,779 59,780 36,877
Property, Plant and
Equipment 2,519 26,791 31,171 37,594 36,639 44,969
Other Assets 7,800 7,525 5,645 3,857 3,627 2,115
Total Assets 116,535 121,810 116,176 110,230 100,046 83,961
Current Liabilities
Accounts Payable 11,762 13,532 15,940 16,408 17,949 4,248
Income Taxes Payable 14,961 15,952 19,591 14,211 7,486 5,187
Other Current Liabilities 10,641 14,444 16,782 16,251 13,733 17,562
Total Current Liabilities 37,364 43,928 52,313 46,870 39,168 26,997
Shareholders' Equity 79,171 77,882 63,863 63,360 60,878 56,964
Total Liabilities and
Shareholders' Equity 116,535 121,810 116,176 110,230 100,046 83,961
(a) Investment funds and short-term investments
Source: 20-F