Exhibit 1

Financial Statements for Tire City, Inc.

For years ending 12/31

1993

1994

1995

Net sales
Cost of sales
Gross profit
GAS expenses
Depreciation
Net interest expense
Pre-tax income
Income taxes
Net income

$16,230
9,430
6,800
5,195
160
119
1,326
546
780

$20,355
11,898
8,457
6,352
180
106
1,819
822
997

$23,505
13,612
9,893
7,471
213
94
2,115
925
1,190

Dividends
Annual purchases
Marginal tax rate

Assumptions for forecasting

1996

INCOME STATEMENT

BALANCE SHEET
Assets
Cash
Accounts Receivable
Inventories
Total current assets
Gross plant & equipment
Accumulated depreciaiton
Net plant & equipment

155
41%

508
2,545
1,630
4,683

1.2 x 1995 sales

58.2% of 1996 sales
31.7% of 1996 sales
213
10%* average debt
43.7% of PBT

200 $ 240 20% of PAT

13,528
15,450
45.2%
43.7%

609
3,095
1,838
5,542

706
3,652
2,190
6,548

3.0% of 1996 sales

15.5% of 1996 sales
1,625

3,232
1,335
1,897

3,795
1,515
2,280

4,163
1,728
2,435

6,580

7,822

8,983

4222 + CA

1,042
1,145
125

1,325
1,432
125

1,440
1,653
125

6.3% of 1996 sales

7.0% of 1996 sales
125

2,312

2,882

3,218

13.3% of sales + 125

Long term debt

1,000

875

750

Common stock
Retained earnings
Total shareholders' equity

1,135
2,133
3,268

1,135
2,930
4,065

1,135
3,880
5,015

6,580

7,822

8,983

Total assets
LIABILITIES
Accounts payable
Accrued expenses
Current maturities of long-term debt
Bank debt
Total current liabilities

Total liabilities

6,163
1,941
4,222

625
No change
3880 + 0.8 x PAT

Corporate Finance Income Statement

1993
1994
Net sales
16,230
20,355
Cost of sales
9,430
11,898
Gross Profit
6,800
8,457
GAS expenses
5,195
6,352
Depreciation
160
180
EBIT
1,445
1,925
Income taxes
595
870
NOPAT
850.0 1,055.1
Tax rate
41.2%
45.2%
Distribution of NOPAT
To lenders towards interest
70.0
58.1
To lenders towards principal repayment
125
125
To shareholders as dividends
155
200
Allowed by SH to be used for operations
500.0
672.0
850.0 1,055.1

Corporate Finance Cash Flow Statement

1993
1994
NOPAT
850
1,055
Depreciation expense
160
180
Operating cash flow (OCF)
1,010
1,235
Increase in NOWC
289
Increase in gross fixed assets
563
Free cash flow to firm (FCFF)
383.1
Distribution of FCFF
To lenders
195.0
183.1
To shareholders as dividends (FCFE)
155
200
350.0
383.1
Net cash flow = PAT + depreciation
940
1,177
Interest tax shield
49
48
Operating cash flow
989
1,225
Corporate Finance Balance Sheet
1993
1994
Assets
Cash balances
Accounts receivable
Inventories
Total current assets
Liabilities
Accounts payable
Accrued expenses
Operating current liabilities
Net operating Working capital
Gross plant and equipment
Accumulated depreciation

1995
23,505
13,612
9,893
7,471
213
2,209
966
1,242.9
43.7%
52.9
125
240
825.0
1,242.9

1995
1,243
213
1,456
670
155
630.9
177.9
240
417.9
1,403
41
1,444

1995

508
2,545
1,630
4,683

609
3,095
1,838
5,542

706
3,652
2,190
6,548

1,042
1,145
2,187
2,496
3,232
1,335

1,325
1,432
2,757
2,785
3,795
1,515

1,440
1,653
3,093
3,455
4,163
1,728

<--- Interest expenses * (1 - tax rate)

<-- principal insalment repaid
<-- 20% of PAT paid out as dividend
<-- balancing figure

<-- different from Net cash flow (NCF)

<-- another way to estimate OCF

Net plant and equipment

NET OPERATING ASSETS

1,897
4,393

2,280
5,065

2,435
5,890

Borrowed capital
Current maturities of LT debt (CMLTD)
Fresh bank loan at 10%
Long-term portion of LT debt
Total borrowings
Common stock
Retained earnings
Total shareholders' equity
Operating capital

125
1,000
1,125
1,135
2,133
3,268
4,393

125
875
1,000
1,135
2,930
4,065
5,065

125
750
875
1,135
3,880
5,015
5,890

Return on invested capital

19.3%

20.8%

21.1%

sumptions for forecasting

1997

1.2 x 1996 sales

58.2% of 1997 sales
31.7% of 1997 sales
333
10%* average debt
43.7% of PBT

20% of PAT

3.0% of 1997 sales

15.5% of 1997 sales
9.3% of sales

6,563
2,274
4,289
4289 + CA

6.3% of 1997 sales

7.0% of 1997 sales
125
13.3% of sales + 125
500
No change
3880 + 0.8 x 1996 PAT + 0.8 x 1997 PAT

st expenses * (1 - tax rate)

al insalment repaid
PAT paid out as dividend

t from Net cash flow (NCF)

r way to estimate OCF