The independent variables include the natural log of total assets, changes in financial characteristics (financial leverage, profit margin, asset turnover, current ratio, days cash on hand, days patient accounts receivable, average age of plant, and total salary to revenue), and three dummy variables: public hospital, nonprofit hospital, and urban hospital.
The independent variables include the natural log of total assets, financial leverage, profit margin, asset turnover (sales to asset), current ratio, days cash on hand, days patient accounts receivable, average age of plant, total salary to revenue, and three dummy variables: public hospital, nonprofit hospital, and urban hospital.
Customers are unlikely to return soon to the high-margin asset classes that powered the industry during the boom years.
Return on equity declined steeply (except for 2001) from 95.5% in 2000 to 50.5% in 2004, as declining operating margins, asset utilization and leverage ($4.1 billion) offset a declining tax and interest burden.
"Such actions could include the disposition or spinoff of underperforming or low-growth, low-margin assets".
"The company has steadied, turned round and now, this month, with high-margin assets returning on stream, we have reached a clear turning point," Dudley said.
"This company has been steadied, turned around and now, this month, with high-margin assets returning onstream, we have reached a clear turning point," Mr. Dudley said in a statement.
After the September 11 , 2001attacks, media attention shifted away from the company and its troubles; a little less than a month later Enron announced its intention to begin the process of selling its lower-margin assets in favor of its core businesses of gas and electricity trading.
This includes a comparison of profits to sales (profit margin), sales to assets (asset turnover), profits to assets (return on assets), assets to worth (financial leverage), and, finally, profits to worth (return on net worth).
"Investors, other than Chinalco, are left with diluted exposure to core, tier 1 assets and increased exposure to the lower margin, downstream assets that Rio was unable to find a buyer for," they wrote.
The next low-margin heavy asset to disappear was turbogenerators.
