Quantitative and Qualitative Disclosures About Market Risk
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Quantitative and Qualitative Disclosures About Market Risk
Quantitative and Qualitative Disclosures About Market Risk
Table of Contents Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Interest Rate Risk We have assessed our vulnerability to certain market risks, including interest rate risk associated with financial instruments included in cash and long-term debt. To mitigate this risk, we entered into a five-year interest rate swap agreement, which expires July 1, 2013, to hedge the variability of interest payments associated with our variable-rate borrowings. Through this swap agreement, we pay interest at a fixed rate of 4.48% and receive interest at a floating-rate of the one-month LIBOR, which was 0.21% at December 31, 2012. Since the interest rate swap hedges the variability of interest payments on variable rate debt with similar terms, it qualifies for cash flow hedge accounting treatment. This interest rate swap reduces our overall interest rate risk. We did not have any unhedged variable rate debt outstanding at December 31, 2012.
Quantitative and Qualitative Disclosures About Market Risk
Due to the nature of our highly liquid cash, an increase or decrease in interest rates would not materially affect the fair value of our cash or the related interest income.
Item 8. Financial Statements and Su pplementary Data Unaudited quarterly financial data for each of the eight quarters in the two-year period ended December 31, 2012 is as follows:
2012 (In thousands, except per share data) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Net sales $ 38,499 $ 44,264 $ 44,588 $ 41,936 Cost of sales 26,792 30,926 30,964 30,579 Gross profit 11,707 13,338 13,624 11,357 Selling, general and administrative expenses 10,373 12,222 11,907 10,388 Operating income 1,334 1,116 1,717 9 6 9 Other expense, net (161) (176) (155) (167) Income before income taxes 1,173 940 1,562 802 Income tax provision 475 381 614 481 Net income $ 6 9 8 $ 5 5 9 $ 948 $ 321 Basic and diluted net income per share $ 0.04 $ 0.03 $ 0.05 $ 0.01 Shares used in basic per share calculation 18,845 18,857 18,872 18,874 Shares used in diluted per share calculation 18,911 18,931 18,954 18,940
2011 (In thousands, except per share data) 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Net sales $ 32,297 $ 41,496 $ 40,477 $ 34,927 Cost of sales 23,069 28,038 27,762 25,142 Gross profit 9,228 13,458 12,715 9,785 Selling, general and administrative expenses 9,289 10,670 10,530 9,253 Operating income (loss) (61) 2,788 2,185 532 Income from equity-method investments 356 335 – – Gain on sale of equity interest in Fulton Street Brewery, LLC – 10,398 – 34 Other expense, net (269) (253) (183) (170) Income before income taxes 2 6 13,268 2,002 396 Income tax provision 10 5,108 771 152 Net income $ 1 6 $ 8,160 $ 1,231 $ 244 Basic and diluted net income per share $ – $ 0.43 $ 0.07 $ 0.01 Shares used in basic per share calculation 18,819 18,829 18,843 18,845 Shares used in diluted per share calculation 18,928 18,945 18,935 18,942
Quantitative and Qualitative Disclosures About Market Risk
Quantitative and Qualitative Disclosures About Market Risk
RUBRIC
Excellent Quality
95-100%
Introduction 45-41 points
The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
Literature Support
91-84 points
The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned.
Methodology
58-53 points
Content is well-organized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met.
Average Score
50-85%
40-38 points
More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided.
83-76 points
Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration.
52-49 points
Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met.
Poor Quality
0-45%
37-1 points
The background and/or significance are missing. No search history information is provided.
75-1 points
Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration.
48-1 points
There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met
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