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to achieve growth in profit before interest and tax of 4% per year and also calculation to achieve growth in earnings per share of 5.5% per year

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The following financial information relates to PHL Co, a listed company Year Profit before Interest and Tax (m) Profit After Tax (m) Dividends (m) Equity - Market value (m) 2020 34.6 20.6 9.6 108.4 2019 33.2 19.5 9.6 104.4 2018 32 17.3 9.0 100.0 PHL Co has 15 million ordinary shares in issue and has not issued any new shares in the period under review. The company is financed entirely by equity and is considering investing 20-41 million of new finance in order to expand existing business operations. This new finance could be either long-term debt finance, a new equity via a rights issue or from retained earnings. The rights issue price would be at a 15% discount to the current share price. Costs of 100,000 would have to be met from the cash raised, whether the new finance was equity or debt. The annual report of SZB Co states that the company has three financial objectives: Objective 1: To achieve growth in profit before interest and tax of 4% per year Objective 2: To achieve growth in earnings per share of 5-5% per year Objective 3: To achieve total shareholder return of 5% per year PHL has a cost of equity of 11%. The following financial information relates to PHL Co, a listed company Year Profit before Interest and Tax (m) Profit After Tax (m) Dividends (m) Equity - Market value (m) 2020 34.6 20.6 9.6 108.4 2019 33.2 19.5 9.6 104.4 2018 32 17.3 9.0 100.0 PHL Co has 15 million ordinary shares in issue and has not issued any new shares in the period under review. The company is financed entirely by equity and is considering investing 20-41 million of new finance in order to expand existing business operations. This new finance could be either long-term debt finance, a new equity via a rights issue or from retained earnings. The rights issue price would be at a 15% discount to the current share price. Costs of 100,000 would have to be met from the cash raised, whether the new finance was equity or debt. The annual report of SZB Co states that the company has three financial objectives: Objective 1: To achieve growth in profit before interest and tax of 4% per year Objective 2: To achieve growth in earnings per share of 5-5% per year Objective 3: To achieve total shareholder return of 5% per year PHL has a cost of equity of 11%

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