activision blizzard financial assesment william shonk

William ShonkSHSU Financial Statement AnalysisActivision Blizzard assessment 04/29/2016

A: Company Description

Activision Blizzard, Inc. is currently the largest interactive gaming company in the world. The company focuses on media, technology, and entertainment. The company’s core competency revolves around the development of video game titles. Activision Blizzard’s portfolio of video game titles includes some of the most popular game franchises in the industry, such as: “Call of Duty”, “Warcraft”, “Diablo”, “Guitar Hero” and “Destiny” (in agreement with Bungie).

Back in 2008, Activision merged with Vivendi Games, which was the holding company for Sierra Entertainment and Blizzard Entertainment. The total transaction amount of the merger was $18.9 billion dollars with Vivendi Games acquiring the majority shareholder position with a 52% stake.

Currently Activision Blizzard is divided into two major segments, Activision Publishing Inc. and Blizzard Entertainment Inc. The Activision Publishing Inc. segment develops and publishes games that operate on the Microsoft Xbox consoles, Nintendo Wii consoles, and Sony PlayStation consoles. The major franchises of the Activision division are “Call of Duty” and “Skylanders”.

The Blizzard Entertainment Inc. segment deals with subscription based “massively multiplayer online role playing games” (MMORPG) that are historically computer games. One such franchise is the infamous World of Warcraft. Blizzard is also very engaged in other role playing games (RPG) like Diablo and strategy based games such as Star Craft.

B Assessment of Statement of Cash Flows

This section will analyze the company’s cash flows over the past three years trailing by exploring five ratios dealing with the statement of cash flows.

1. Operating cash flows ratio2. Asset efficiency ratio3. Current liability coverage ratio4. Long term debt coverage ratio5. Interest Coverage ratio

The operating cash flows ratio (cash flow from operations “CFO” / sales) explains how many dollars of cash are received for every dollar of sales. This ratio is not bench marked with specific thresholds. Rather, the larger the ratio, the better it is. The current three year trend is roughly stable with about $0.27 operating cash for ever $1.00 of sales (see figure 1).

Figure 1Year 2015 2014 2013


Net cash provided by operating activities (CFO) 1,192 1,292 1,264Total net revenues 4,664 4,408 4,583Operating Cash Flows Ratio $ 0.26 $0.29 $ 0.28

The asset efficiency ratio (CFO / total assets) explains how well a company uses its assets to generate cash flow. The greater the ratio the better. The average asset efficiency ratio explains that the company generates on overage $0.085 of cash flow for every $1.00 of assets (see figure 2).

Figure 2Year 2015 2014 2013Net cash provided by operating activities 1,192 1,292 1,264Total assets 15,251 14,642 NAAsset Efficiency Ratio $ 0.08 $ 0.09 NA

The current liability coverage ratio ((CFO – dividends paid) / current liabilities) explains the company’s short term debt management. Keep in mind it is more accurate to subtract the dividend paid. This ratio explains how much current cash flows can pay for the company’s current liabilities. Activision can pay for 0.52, or about half of its current liabilities with current cash flows. The higher the ratio the better. When the ratio is below 1, the CFO cannot pay for all of the current liabilities (see figure 3).

Figure 3Year 2015 2014 2013Net cash provided by operating activities 1,192 1,292 1,264Dividends paid (170) (147) (216)

1,362 1,439 1,480Total current liabilities 2,611 2,714 NACurrent Liability Coverage Ratio 0.52 0.53 NA

The long term debt coverage ratio ((CFO – dividends) / long term debt) explains the company’s long term debt management. Again, subtract dividends paid for increased accuracy. The higher the number the better. When the ratio falls below 1, the company does not have enough cash flow to pay for all of the long term debt. The company has enough cash flow to pay for 0.33 or a third of its long term debt for 2015 (see figure 4).

Figure 4Year 2015 2014 2013Net cash provided by operating activities 1,192 1,292 1,264Dividends paid (170) (147) (216)

1,362 1,439 1,480Long-term debt, net 4,079 4,324 NALong Term Debt Converge Ratio 0.33 0.33 NA


The interest coverage ratio ((CFO + interest paid + taxes paid) / interest paid) explains the company’s ability to pay for the interest on its total debt load. If a company has a ratio less than 1, then the company has a high risk of default on its debt load. The lower the multiple, the more leveraged the company is. In 2013 the interest coverage ratio was extremely high, at 30.68. The interest coverage ratio for 2013 was very high in comparison to 2014 and 2015 largely due to the decreased interest expense for 2013; which was nearly ¼ the interest expense of 2014 and 2015. Over the next two years the ratio averages out at being able to pay up to 8.15x the current interest amount with the company’s cash flow from operations (see figure 5).

Figure 5Year 2013 2014 2015Net cash provided by operating activities 1,264 1,292 1,192Interest and other expense, net 53 202 198Income tax expense 309 146 229

1,626 1,640 1,619Interest and other expense, net 53 202 198Interest Coverage Ratio 30.68 8.12 8.18

C. An assessment of the company’s profitability and efficiency measures

This section will explore multiple profitability and efficiency ratios to determine the financial health of Activision Blizzard Inc. and two of the company’s largest U.S. competitors, Electronic Arts Inc. and Take-Two Interactive Software. The below ratios were taken from the Wharton Research Data Services (WRDS) in the first quarter of year 2016. The specific ratios taken from the WRDS data that will be included in this section are as follows:

Return on common equity (ROE):The ROE explains how many dollars of company profits are being generated with each dollar of shareholders’ equity. In 2015 Activision Blizzard generated $0.117 of profit for every $1 of shareholder equity, giving the stock at 11.7% ROE (NI / shareholders equity). The higher the ROE the better (see figure 6).

Return on total assets (ROA):Explains the amount of company profits generated as a percentage of the value of total assets. In 2014 Activision Blizzard generated $.07 dollars for every $1 of total assets (NI / total net assets). The higher the ROA the better (see figure 6).

Net profit margin: Is the percentage of revenue remaining after operating, interest, and tax expenses have been paid, less preferred stock dividends (net income / sales). In 2015 Activision Blizzard kept 19.1% of its remaining revenues as profit after expenses. For every $1.00 of revenue, $0.191 was left over as profit after said expenses. The higher the better (see figure 6).

Total asset turnover:


Measures how efficiently assets generate revenue. In 2015 Activision Blizzard generated $0.299 of sales for every $1.00 of company assets (sales / total assets). The higher the number the better, but only in the same industry. Low margin industries have a higher asset turnover to offset the lower per-unit profits with higher unit sales volume (see figure 6).

Financial leverage multipliers, debt ratio and debt-equity ratio: Financial leverage ratios explain the company’s level of debt. Two of the most common are 1. Debt-equity ratio and 2. Debt ratio.

1. The debt-equity ratio measures how much of a company’s capital is owned by creditors compared to shareholders. In 2015 for every $1.00 owned by Activision Blizzard shareholders the company owed $0.889 to creditors (total debt/ total equity) (see figure 6). 2. The debt ratio explains how leveraged a company is by its debt. In 2014 for every $1.00 of assets owned by Activision Blizzard the company had $0.493 of debt (total debt / total assets) (see figure 6).

A high debt-equity ratio means a significant portion of the company’s cash flows are dedicated to pay off debt. This is risky because a rise in interest rates may cause negative financial repercussions and/or default. A low debt to equity means there are less financial obligations linked to company cash flows. However, this can also signify that the company is not taking advantage of increased revenues from expansion because it is forgoing financial leverage. High and low ratios are best looked at in industry context. Lenders and investors prefer low financial leverage ratios because in the event of a business decline, the lenders and investors are more likely to receive back some of their original investment in the event of a liquidation.

Note: ratios are rounded to the third decimal

Figure 6ACTIVISION BLIZZARD 2013 2014 2015ROENI / shareholder’s equity #N/A 0.121 0.117ROANI / total net assets #N/A 0.070 #N/ANet Profit MarginNI / sales 0.220 0.189 0.191Total Asset TurnoverSales 14012 14746 15244Total assets 4583 4408 4664Total asset turnover 0.327 0.299 0.306Financial Leverage MultipliersTotal Debt / Common Equity 1.113 1.023 0.889Total Debt / Total Assets 0.573 0.493 #N/A


Figure 6aELECTRONIC ARTS 2013 2014 2015ROENI / shareholder’s equity #N/A 0.320 #N/AROANI / total net assets #N/A 0.152 #N/ANet Profit MarginNI / sales 0.002 0.194 #N/ATotal Asset TurnoverSales 5716 6147 #N/ATotal assets 3575 4515 #N/ATotal asset turnover 0.625 0.735 #N/AFinancial Leverage MultipliersTotal Debt / Common Equity 1.353 0.998 #N/ATotal Debt / Total Assets 0.573 0.493 #N/A

Figure 6bTAKE-TWO INTERACTIVE 2013 2014 2015ROENI / shareholder’s equity #N/A -0.410 #N/AROANI / total net assets #N/A -0.123 #N/ANet Profit MarginNI / sales 0.1538 -0.258 #N/ATotal Asset TurnoverSales 1799.63 2231.1 #N/ATotal assets 2350.568 1082.938 #N/ATotal asset turnover 1.306 0.485 #N/AFinancial Leverage MultipliersTotal Debt / Common Equity 1.244 2.962 #N/ATotal Debt / Total Assets 0.554 0.748 #N/A

Figure 6, 6a and 6b together manifest a cross sectional analysis for Activision Blizzard, Electronic Arts and Take-Two Interactive. The analysis will only focus on three ratios, ROA, Profit Margin and Debt Ratio for the year 2014. 2014 was selected because some of the companies have incomplete data for years 2015 and 2013. Year 2014 was the only year where the three companies had all the corresponding data in relation to one another.

According to figure 7 Activision Blizzard and Electronic Arts are very similar in ROA, profit margin and debt ratio. Take-Two Interactive is experiencing poor performance as the ROA and the profit margin are both negative ratios, signaling that the company has more expenses than profits with its cash flow from operations in the red. Take-Two Interactive is also risky in comparison as it has a greater debt ratio than its competitors. The high debt ratio could make


investors weary of investment that may be needed to support operations. The negative ROA and profit margin with a high debt ratio will result in unsustainability and the company will need to restructure to avoid default.

Figure 7

Activision Blizzard Electronic Arts Take-Two Interactive

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0.070 0.152

(0.123)

0.189 0.194

(0.258)

0.493 0.493

0.748

Cross-sectional profitability and efficiency analysis 2014

ROA Profit Margin Debt Ratio

D. Assessment of liquidity and solvency ratios:

This section will review the following liquidity and solvency ratios. Liquidity is a company’s ability to convert assets into cash in order to meet its short term obligations with liquid assets. Solvency is the degree to which a company’s current assets are greater than its current liabilities. This solvency allows a company to pay it for its debt obligations when due. If a company is insolvent, it cannot meet debt obligations when due and must be sold off or liquidate. This section will explore the below liquidity and solvency ratios provided by the WRDS.

Current ratio:Measures a company’s ability to pay its current liabilities with its current assets (current assets / current liabilities). A 2:1 ratio is a generic rule of thumb, however, this depends on the context of related industries. Low ratios could indicate issues with inventory management or ineffective methods at collecting receivables. In 2015 Activision Blizzard’s current ratio was 2.661, meaning the company has $2.661 of assets for every $1.00 of liabilities. The higher the ratio the better. Quick ratio i.e. Acid test:


Measures a company’s ability to pay its short-term financial liabilities. In 2015 Activision Blizzard had a quick ratio of 2.325. For every $1.00 of current liabilities, the company had $2.325 liquid assets to cover its current liabilities ((CA – Inventory) / CL). Days’ sales in receivables or days sales outstanding (DSO):Measures how many days it takes to collect money on credit sales. In 2015 Activision Blizzard had days’ sales receivable or DSO of 51.638 days until the company collected the money due on credit sales (AR/ (Net sales on credit/ 365)). Days’ sales in inventory (DSI):Measures over how many days a company sells its inventory. In 2015 Activision Blizzard had a DSI of 41.412 days to sell off its inventory ((Inventory/ COGS) * 365). High and low numbers aren’t meaningful unless compared to industry specific standards. Debt ratio, debt-equity ratio Explained in section C. Interest coverage ratio:Measures how well a company meets its interest payments ((EBIT + taxes) / interest expense). In 2014 Activision Blizzard had an interest coverage ratio of 5.688. However, WRDS uses slightly a different formula, (OIADP / Interest), instead of EBIT, which is similar. This means that Activision Blizzard is able to meet its interest payments 5.668x over (see figure 8).

Figure 8, 8a and 8b is a cross sectional liquidity & solvency analysis for Activision Blizzard, Electronic Arts and Take-Two Interactive. In year 2014, Electronic Arts has an extremely high interest coverage ratio at 34.6129 compared to the other two companies. Regarding the DSO, Activision Blizzard and Take-Two Interactive have DSO in the mid 40’s but Electronic Arts has its DSO at 27.4648 days. This means Electronic Arts has superior collecting methods to collect the money due from sales on credit as it only take the company about 27 days to collect its money while it takes 45 days for the other two companies to collect their money due from sales on credit.

Figure 8ACTIVISION BLIZZARD 2013 2014 2015Current RatioCurrent assets / current liabilities 2.595 2.546 2.661Quick Ratio(CA – Inventory) / CL 2.062 2.033 2.325Day’s Sales in ARAR/ (Net sales on credit/ 365) #N/A 47.940 51.638Day’s Sales in Inventory(Inventory/ COGS) * 365 #N/A 45.464 41.412Interest coverage ratioOIADP / Interest 23.655 5.688 #N/A

Figure 8aELECTRONIC ART 2013 2014 2015


Current RatioCurrent assets / current liabilities 1.313 1.354 #N/AQuick Ratio(CA – Inventory) / CL 1.12636 1.23153 #N/ADay’s Sales in ARAR/ (Net sales on credit/ 365) #N/A 27.4684 #N/ADay’s Sales in Inventory(Inventory/ COGS) * 365 #N/A 14.6678 #N/AInterest coverage ratioOIADP / Interest 1.5 34.6129 #N/A

Figure 8bTAKE-TWO INTERACTIVE 2013 2014 2015Current RatioCurrent assets / current liabilities 2.947 1.844 #N/AQuick Ratio(CA – Inventory) / CL 2.49017 1.53746 #N/ADay’s Sales in ARAR/ (Net sales on credit/ 365) #N/A 45.0446 #N/ADay’s Sales in Inventory(Inventory/ COGS) * 365 #N/A 11.2893 #N/AInterest coverage ratioOIADP / Interest 12.2179 -8.2477 #N/A


Figure 8

Activision Blizzard Electronic Arts Take-Two Interactive

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Cross-sectional liquidity & solvency analysis 2014

Quick Ratio DSO DSI Interest coverage ratio

Take-Two Interactive has a DSI about three times less than that of Activision Blizzard. This infers that Take-Two Interactive sells its inventory faster than Activision Blizzard. Even though Take-Two Interactive sells its inventory very quickly by comparison, it collects on its account receivables at par with Activision Blizzard as noted early in the DSO. Regarding the interest coverage ratio, Activision Blizzard and Electronic Arts are able to cover their short term financial obligations but Take-Two Interactive cannot meet its short term financial obligations due to its negative ratio of -8.2477. If this continues Take-Two Interactive will become insolvent and may default on its loans.

The Altman z-score is a statistical tool used to measure the probability that a firm will go bankrupt. The likelihood of bankruptcy also effectively measures the risk of a firm. The Altman z-score is comprised of five financial ratios incorporated into a single formula with corresponding multipliers.

The z-score formula is as follows:

Z-Score = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E

A = Working Capital/Total AssetsB = Retained Earnings/Total Assets


C = Earnings Before Interest & Tax/Total AssetsD = Market Value of Equity/Total LiabilitiesE = Sales/Total Assets

The z-score is inversely related to risk. In general, the lower the z-score, the higher the chance the greater the likelihood for bankruptcy. The z-score’s threshold for financial soundness is 3.0; anything below 3.0 is considered increasingly uncertain and therefore more risky. A z-score below 1.8 signifies a company is likely headed for bankruptcy. Investors commonly use the z-score to determine if a firms stock should be bought or sold if there is concern about the firm’s underlying financial strength and the firm’s corporate credit risk. Refer to figure 9 for a summary of how to interpret z-score thresholds.

Figure 9Z-score Financial Health Likelihood of bankruptcy> 3.0 Healthy Not likely1.8 - .299 Grey area Gray area< 1.8 Unhealthy Likely

In order to calculate the Z-score from the WRDS, the calculations will be slightly modified since the data is slightly different. The calculations will be as follows:

Z-Score = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E A= (CA - CL) / TAB= RE / TAC= OIAD / TAD= Stock price x shares outstanding / TLE= Sales /TA

Activision Blizzard and Electronic Arts both are financially viable and considered financially healthy as both the z-scores are greater than 3.0. Take-Two Interactive is in the gray zone in between 2.99 - 1.8. This signifies that the financial health of the firm is uncertain and that the firm may or may not be headed for bankruptcy (see figure 10).

Figure 10Company Z-score Year Financial ViabilityActivision Blizzard 3.047208 2014 HealthyElectronic Arts 5.205848 2014 HealthyTake-Two Interactive 2.727288 2014 Uncertain

Figures 11, 11a and 11b explain what data was used to calculate the z scores for Activision Blizzard, Electronic Arts and Take-Two Interactive.

Z-Score = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E


Figure 11Activision BlizzardFinancial Data Year 2014Current assets 6909Total assets 14746Current liabilities 2714Total liabilities 7513Retained earnings 3071OIAD 1183Sales 4408Stock Price 20.15Shares outstanding 1,150Z score components Year 2014A = 0.34138B = 0.29156C = 0.26474D = 1.85059E = 0.29893Z Score 3.04721

Figure 11aElectronic Arts EAFinancial Data Year 2014Current assets 3720Total assets 6147Current liabilities 2747Total liabilities 3111Retained earnings 906OIAD 1073Sales 4408Stock Price 58.815Shares outstanding 310 (in millionsZ score components Year 2014A = 0.18995B = 0.20634C = 0.57604D = 3.51642E = 0.7171Z Score 5.20585

Figure 11bTake-Two interactive


Financial Data Year 2014


Current assets 1781.308Total assets 2231.1Current liabilities 966.26Total liabilities 1668.012Retained earnings -189.319OIAD -258.268Sales 4408Stock Price 25.455Shares outstanding 89Z score components Year 2014A = 0.43837B = -0.1188C = -0.382D = 0.814E = 1.97571Z Score 2.72729

Note: all numbers are in millions.

E. Forecasted company financial statements

This section will forecast the Activision Blizzard’s company income statement, balance sheet, and cash flow statement for one year after the most recent year-end. This forecast will also include one feedback loop for reference. The assumptions used to create this pro forma will be included on a separate excel spreadsheet where the data was input listed under section E (see figure 12)


Figure 12


The forecasted Z-score is 1.29 which is in the financially non-viable threshold. This forecasted z-score used many assumptions that skewed the actual future z-score and this should only be considered an estimated example. Many accounts were fixed due to discrepancies in the WRDS data with the 10-K, which ultimately produced inaccuracies. Nonetheless, this is how a forecast would take place.

The forecasted net income decreased by over 150 million due to associated increases in greater amounts of debt finance. The current maturities of long-term debt increased due to the higher amounts of debt needed to finance continued operations.

The increased debt slightly decreased the interest coverage ratio, which should have also increased the debt ratio and created more liabilities which would have also decreased the quick ratio and current ratio.

In the end, these forecasted ratios aren’t overly unfavorable because the company can meet its debt obligations and it has more than enough assets to cover its liability. However, the 1.2959 z-score is highly unfavorable since a z-score under 1.8 signifies a company is headed for bankruptcy.

Section F


This section will estimate the value (per share) of the company’s common stock. Figure 13 will explain what data was used in this calculation. The assumptions used in this forecast will be included on a separate excel spreadsheet listed under section E2.

Figure 132015 est 2016 est 2017 est 2018 est 2019

Revenue forecasts (10-k) $ 4,664.0

$ 4,897.20

$ 5,142.06

$ 5,399.16

$ 5,507.15

NOPAT forecasts (NOPM * sales )

$ 926.7

$ 972.98

$ 1,021.63

$ 1,072.71

$ 1,094.17

NOA forecasts (sales / NOAT) $ 3,372.0

$ 3,540.6

$ 3,717.6

$ 3,903.5

$ 3,981.6

NOAT (fixed) 1.38 1.38 1.38

1.38

1.38

NNO (fixed) $ (3,080.0)

$ (3,080.0)

$ (3,080.0)

$ (3,080.0)

$ (3,080.0)

Common Shares Outstanding $ 1,163.0

$ 1,163.0

$ 1,163.0

$ 1,163.0

$ 1,163.0

FFCF ( NOPAT-(NOA forecasts - NOA previous year))

$ 804.38

$ 844.60

$ 886.83

$ 1,016.10

WACC 8.7%Growth first 3 years (assumed) 5%Growth after 3 years (assumed) 2%NOPM 20%

2016 2017 2018 2019PV function for PV of FCFF $740.17 $715.14 $690.96 $791.68

PV terminal

Cumulative PV FCFF (less terminal) $2,146.28PV of Terminal (perpetuity) $11,860.41Total Cumulative PV of FCFFs $14,006.69plus - NNO -3080.00Firm Equity $17,086.69Shares Outstanding 1163Stock Price per Share $14.69

WACC from 10-k 2015

Equity 8,068,000.00

NOA and NOATSource: 10-kNet receivables $


Short term debt -

Long term debt 4,079,000

Total Value: Equity + Debt

$12,147,000.0

Equity / Total Value 66.42%Debt / Total Value 33.58%

CAPM from finance.yahoo.comRf (T-bill) 0.04B (beta "key Statistics" of ATVI) 1.21Rm ( risk premium "avg return on stock mrkt") 0.10Cost of Equity 0.113

Cost Debt (assumed) 0.050Tax (assumed) 0.350WACC 8.7%

NOPATSource 10-k

EBIT $ 1,319.00

EBT $ 1,121.00

Tax 35%NOPAT $ 926.7

343.0

Inventories $ 128.0

Other current assets $ 383.0

Net property, plant & equipment

$ 189.0

Intangible assets $ 49.0

Other long-term assets $ 173.0

Goodwill $ 7,095.0

Operating Assets $ 8,360.0

Accounts payable $ 284.0

Other accrued expenses $ 625.0

Long-term debt $ 4,079.0

Operating Liabilities $ 4,988.0

NOA $ 3,372.0

Sales $ 4,664.0

NOAT 1.3832

NNOSource from (10-k)Shareholders’ equity (10-k) 8,068

NOA 4988.0NNO -3080.0000

Regarding the value (per share) of the company’s stock, there are various steps that must be taken.

1. Calculate the Net Operating Assets (NOA) from the 10-k balance sheet.2. Deduct the stockholder’s equity (SE) from the NOA, and what is remaining is the Net

Non-operating Obligations (NNO).3. Net Operating Profits After Taxes (NOPAT) will include the net income, less the tax

shield on the NNO.4. The NOAT will be revenues / NOA5. The NOPM is the NOPAT / revenues


6. The forecasted NOPAT is the forecasted revenues * NOPM. 5% for three years than 2% thereafter (assumption).

7. The forecasted NOA is forecasted NOAT * NOAT8. The FCFF will use WACC but instead of using the discount factors it was easier to use

the PV function. Also 5% for the first three years and 2% for terminal.9. Add the cumulative FCFF for the first 3 years, then obtain the perpetuity amount of the

PV of the terminal.10. Add the NNO (which is a negative and thus adds in as a positive)11. Add the total cumulative PV of the FCFF including the PV of the perpetuity of the

terminal year and that will equal the firms equity12. Lastly firm equity / shares outstanding13. Stock value price per share is $14.69

The value of the stock is $14.69 while the historical value according the 10-k in year 2015 for Activision Blizzard was $38.71. This is nearly half of the stock from 2015. However, this is to be expected due to the drastic assumption used to forecast, primarily using data from WRDS.

The drastic decrease in stock value would be unfavorable to current and potential creditors of the company. Stock prices act a barometer for company performance, which is due in part to the link between company earnings and its stock price. In the long run, favorable earnings or a solid indication that a firm will be able to fulfill its debt obligations. This will effectively result in more favorable financing through lower interest rates which in turn increases value returned from capital projects.

Nevertheless, in this scenario, the estimated value of Activision Blizzard’s stock is half of what it was listed at in 2015 and this is an indication of poor performance, which is tied to unfavorable earnings. The decreased earnings caste doubt on the firm’s ability to meet its financial obligations. This risk to not meet debt obligations is unfavorable for potential creditors and may make it difficult for Activision Blizzard to raise additional capital.

activision blizzard financial assesment william shonk

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