Exhibit 1 Financial Statements for Tire City, Inc.

($ 000s)

For years ending 12/31 1993 1994 1995

INCOME STATEMENT

Net sales $ 16,230 $ 20,355 $ 23,505

Cost of sales 9,430 11,898 13,612
Gross Profit 6,800 8,457 9,893

Selling, general, and

administrative expenses 5,195 6,352 7,471
Depreciation 160 180 213
Net interest expense 119 106 94
Pre-tax income 1,326 1,819 2,115
Income taxes 546 822 925
Net income $ 780 $ 997 $ 1,190

Dividends $ 155 $ 200 $ 240

BALANCE SHEET

Assets
Cash balances $ 508 $ 609 $ 706
Accounts receivable 2,545 3,095 3,652
Inventories 1,630 1,838 2,190
Total current assets 4,683 5,542 6,548

Gross plant & equipment 3,232 3,795 4,163

Accumulated depreciation 1,335 1,515 1,728
Net plant & equipment 1,897 2,280 2,435

Total assets $ 6,580 $ 7,822 $ 8,983

Liabilities
Current maturities $ 125 $ 125 $ 125
Accounts payable 1,042 1,325 1,440
Accrued expenses 1,145 1,432 1,653
Total current liabilities 2,312 2,882 3,218

Long-term debt 1,000 875 750

Common stock 1,135 1,135 1,135

Retained earnings 2,133 2,930 3,880
Total shareholders' equity 3,268 4,065 5,015

Total liabilities and equity $ 6,580 $ 7,822 $ 8,983

3
Financial Ratio Analysis for Tire City
For years ending 12/31 1993 1994 1995

Profitability
Profit margin 0.048 0.049 0.051
Return on assets 0.119 0.127 0.132
Return on equity 0.239 0.245 0.237
Return on capital 0.193 0.208 0.211

Tax rate 0.412 0.452 0.437

Liquidity
Current ratio 2.026 1.923 2.035
Quick ratio 1.321 1.285 1.354

Activity
Total asset turnover 2.467 2.602 2.617
Inventory turnover 5.785 6.473 6.216
Ave. collection period 57.235 55.499 56.710
Days payable 39.949 37.640

Leverage
Debt-to-capital 0.256 0.197 0.149
Equity multiplier 2.013 1.924 1.791
Interest coverage 12.143 18.160 23.500

Growth
Sales growth rate 0.254 0.155
Profit growth rate 0.278 0.194
Financial Statements for Tire City, Inc. ($ 000s)
Common Size Statements (fractions of sales, except taxes and dividends)

For years ending 12/31 1993 1994 1995 Average

INCOME STATEMENT

Net sales 1.000 1.000 1.000

Cost of sales 0.581 0.585 0.579 0.582
Gross Profit 0.419 0.415 0.421

Selling, general, and

administrative expenses 0.320 0.312 0.318 0.317
Depreciation
Net interest expense
Pre-tax income
Income taxes 0.412 0.452 0.437 0.434
Net income

Dividends 0.199 0.201 0.202 0.200

Financial Statements for Tire City, Inc. ($ 000s)
Common Size Statements (fractions of sales, except taxes and dividends)

For years ending 12/31 1993 1994 1995 Average

BALANCE SHEET

Assets
Cash balances 0.031 0.030 0.030 0.030
Accounts receivable 0.157 0.152 0.155 0.155
Inventories 0.100 0.090 0.093 0.095
Total current assets 0.289 0.272 0.279 0.280

Gross plant & equipment

Accumulated depreciation
Net plant & equipment 0.117 0.112 0.104 0.111

Total assets

Liabilities
Current maturities
Accounts payable 0.064 0.065 0.061 0.064
Accrued expenses 0.071 0.070 0.070 0.070
Total current liabilities

Long-term debt

Common stock
Retained earnings
Total shareholders' equity

Total liabilities and equity

es and dividends)

Forecasts
1996 1997

0.582 0.582

0.317 0.317

0.434 0.434

0.200 0.200
es and dividends)

Forecasts
1996 1997

0.03 0.03
0.155 0.155
0.093

0.064 0.064
0.070 0.070
Pro Forma Financial Statements for Tire City, Inc. ($ 000s)

For years ending 12/31 1996 1997

INCOME STATEMENT

Net sales
Cost of sales
Gross Profit

Selling, general, and

administrative expenses
Depreciation
Net interest expense
Pre-tax income
Income taxes
Net income

Dividends
Pro Forma Financial Statements for Tire City, Inc. ($ 000s)

For years ending 12/31 1996 1997

BALANCE SHEET

Assets
Cash balances
Accounts receivable
Inventories
Total current assets

Gross plant & equipment

Accumulated depreciation
Net plant & equipment

Total assets

Liabilities
Current maturities
Accounts payable
Accrued expenses
Total current liabilities

Bank debt (plug figure)

Long-term debt

Common stock
Retained earnings
Total shareholders' equity

Total liabilities and equity

. ($ 000s)

Comments:
. ($ 000s)

Comments:
Pro Forma Financial Statements for Tire City, Inc. ($ 000s)

For years ending 12/31 1996 1997

INCOME STATEMENT

Net sales 28206 33847

Cost of sales 16403 19684
Gross Profit 11803 14163

Selling, general, and

administrative expenses 8932 10718
Depreciation 213 333

Net interest expense 119 175

Pre-tax income 2539 2937
Income taxes 1101 1274
Net income 1438 1663

Dividends 288 333

Pro Forma Financial Statements for Tire City, Inc. ($ 000s)

For years ending 12/31 1996 1997

BALANCE SHEET

Assets
Cash balances 846 1015
Accounts receivable 4365 5238
Inventories 1625 3154
Total current assets 6836 9407

Gross plant & equipment 6163 6563

Accumulated depreciation 1941 2274
Net plant & equipment 4222 4289

Total assets 11058 13696

Liabilities
Current maturities 125 125
Accounts payable 1792 2150
Accrued expenses 1986 2383
Total current liabilities 3903 4658

Bank debt (plug figure) 365 1042

Long-term debt 625 500

Common stock 1135 1135

Retained earnings 5030 6360
Total shareholders' equity 6165 7495

Total liabilities and equity 11058 13696

nc. ($ 000s)

.582 x sales

.317 x sales
given, text
.10xnew debt
+ .094xold debt

.434 x profit

.20 x net
nc. ($ 000s)

.03 x sales
.155 x sales
see text

given, text
given, text

given, text
.064 x sales
.07 x sales

given, text
Pro Forma Financial Ratio Analysis for Tire City

For years ending 12/31 1995 1996 1997

Profitability
Profit margin 0.051 0.051 0.049
Return on assets 0.132 0.130 0.121
Return on equity 0.237 0.233 0.222
Return on capital 0.211 0.207 0.192

Tax rate 0.437 0.434 0.434

Liquidity
Current ratio 2.035 1.752 2.019
Quick ratio 1.354 1.335 1.342

Activity
Total asset turnover 2.617 2.551 2.471
Inventory turnover 6.216 10.094 6.242
Ave. collection period 56.710 56.481 56.481
Days payable 37.640 41.289 36.994

Leverage
Debt-to-capital 0.149 0.153 0.182
Equity multiplier 1.791 1.794 1.827
Interest coverage 23.500 22.374 17.809
($ 000s)
For years ending 12/31 1996

Accounts receivable 4365

Inventories 1625
Accounts payable 1792
Net working capital 4198
1997

5238
3154
2150
6241