1 / 24

Professor Dr. Rainer Stachuletz Corporate Finance

Financial Statements And Cash Flow Analysis. Professor Dr. Rainer Stachuletz Corporate Finance. Four Key Financial Statements. Balance sheet. Income statement. Retained earnings. Cash flow Statemt. Financial Managers and analysts use financial statements to conduct: Cash Flow Analysis

kirk-pitts
Download Presentation

Professor Dr. Rainer Stachuletz Corporate Finance

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Financial Statements And Cash Flow Analysis Professor Dr. Rainer Stachuletz Corporate Finance

  2. Four Key Financial Statements Balancesheet Income statement Retainedearnings Cash flowStatemt. • Financial Managers and analysts • use financial statements to conduct: • Cash Flow Analysis • Performance (Ratio) Analysis

  3. Accounting Profit vs. Cash Flow Accounting Profit based on accrual accounting—focus on past periods Finance emphasizes the importance of timing “You can’t deposit net income, only cash” Timing of cash flow matters. Accrual accounting may obscure timing. What are key measures of cash flow?

  4. Sources Uses • Decrease in any asset • Increase in any liability • Net profits after taxes • Depreciation and other non-cash charges • Sale of stock • Increase in any asset • Decrease in any liability • Net loss • Dividends paid • Stock repurchase or retirement Sources and Uses of Corporate Cash

  5. Cash Flow f. Operations • Total cash generated Operating Cash Flow • Cash flow before repaying lenders Free Cash Flow • Cash flow that firm could distribute to investors. Key Measures of Cash Flow 5

  6. Types Of Financial Ratios Liquidity Ratios Activity Ratios Debt Ratios Profitability Ratios Market Ratios

  7. Financial Ratios: Trends and Benchmarking Benchmarking: comparison of a company’s ratio values to industry competitors’ ratios Firms’ financial ratios compared at the same point in time Trend analysis - performance evaluation over time Developing trends can be seen using multi-year comparisons.

  8. Staples (2004) Office Depot (2004) Liquidity Ratios

  9. Staples (2004) Office Depot (2004) Activity Ratios

  10. Staples (2004) Office Depot (2004) Activity Ratios (Continued)

  11. Staples (2004) Office Depot (2004) Debt Ratios

  12. Staples (2004) Office Depot (2004) Debt Ratios (Continued)

  13. Staples (2004) Office Depot (2004) Profitability Ratios

  14. Staples (2004) Office Depot (2004) Profitability Ratios (Continued)

  15. Staples (2004) Office Depot (2004) Profitability Ratios (Continued)

  16. Staples (2004) Office Depot (2004) Market Ratios

  17. Staples (2004) Office Depot (2004) Market Ratios

  18. Financial Statements andCash Flow Analysis Case: Staples Ltd.

  19. Staples Balance Sheet($ Thousands)

  20. Staples Liabilities & Stockholders’ Equity ($ Thousands)

  21. Staples Income Statement ($ Thousands)

  22. Staples Statement Of Retained Earnings ($ Thousands) Common stock Cumul. Translat adjustmt Retained earnings Treasury stock Income Balances February 1, 2003 1,485,132 11,481 1,719,091 (556,812) 484,710 Equity offering 252,972 --- --- --- --- CS issues for option exercise 121,553 --- --- --- --- Tax benefit for option exercise 30,613 --- --- --- --- CS to employee saving plan 9,136 --- --- --- --- Sale of CS under ESOP 16,170 --- --- --- --- Issues of restricted stock 18,389 --- --- --- --- Translation adjustments --- 69,521 --- --- 69,521 Reissuance of treasury stock 97 --- --- 28 --- Net income for year --- --- 490,211 --- 490,211 Purchase of treasury stock --- --- --- (4,315) --- Other (367) --- --- --- --- Balances January 31, 2004 1,933,379 81,002 2,209,302 (561,099) 559,732

  23. Staples Statement Of Cash Flows($ Thousands)

  24. Staples Statement Of Cash Flows ($Thousands)

More Related