Danone Financial Statement Analysis

As a childcare provider I must ensure quality meals are served to children and that nutrition education is encouraged. I offer a variety of foods for our preschoolers and toddlers. Each meal has whole grain bread, a serving of vegetables, and a serving of fruit, with a meat or meat alternate, and milk is served with each meal. I believe that my menu meets all the requirement for a child’s nutritional needs according to the “National Standards for Child Nutrition Programs”

* Another important aspect to be noted is that, although the company has a very low operating profit the

Stable cash flows with estimated total revenues increasing from 559.9 million in 1978 to 937.8 million in 1984 (Note also its strong intellectual property as shown by its

The firm shows positive health for the Shareholders Equity with an equity ratio of 44.2% in 2011 and increasing to 45.2% in 2012. Calculating the percent of total assets that shareholders would receive in the event of company liquidation looks positive and very healthy for any investors or shareholders of this firm. The interest coverage ratio is also at a value that is significantly positive 14.0% in 2011 and 12.8% in 2012. Although 2021 shows a decrease, the company is still very capable of generating sufficient revenues to cover their interest payments on any debt they have incurred.

While doing the horizontal analysis there was quite a huge gain for CB as in total profit between years 6 and your 7. This is always a positive analysis when a company has higher profits than the previous year, and in this case CB, not only did it make a higher profit, but had a gain of over 300% of what it did in year 6. Any investor looking at these numbers will say that this company was a profitable company during this time period.

* In 2005, the profit was approximately ($144,000 / $5,500,000) 2.6% of sales; does this number indicate whether the company is doing well or not?

On the other hand, the company has been growing constantly. In deed, according to the net income estimation for 2007 (see Table 7) the company increases its profits $25 thousand dollars more than the previous year. This is an evidence of how the company is been management and of its willing to grow year after year. Nevertheless, the first quarter of 2007 the working capital only has increased by $7 thousand dollars, which is the difference between the current assets and current liabilities but the importance of this is that according to the rotation on receivables and payable accounts, shown in Table 5 and 10, leads us to the conclusion that the company will have to pay its suppliers

The administration proposed major alterations to the rule of company’s labeling nutrients on the back of foods and other nutrient supplement. The main goal of this is to let consumers know everything they are putting into their bodies to promote more health in the country. The changes included the format where the nutrients are labeled, required a special exception for products that may not be reported on the nutrients label, and the overall reporting of nutrients. The Food and Drug Administration is looking into what

Return on Total Assets was 4.43% which is below five percent. That indicates that the company is not accurately converting its assets into profit. The total for Return on Stockholders’ Equity was 8.89%, however financial analysts prefer ROE to range between 15-20 %. The company’s low ROE indicates that the company is not generating profit with new investments. Lastly, Debt-to-Equity ratio for the company was 1.01 which indicates that investors and creditors are equally sharing assets. In the view of creditors, they see a high ratio as a risk factor because it can indicate that investors are not investing due to the company’s overall performance. The totals of these three ratios demonstrate that the company’s financial state is not as healthy as it should be.

Before revealing the details about the rule, an overview of the memo will be provided. This memo will describe the rule “Food Labeling: Revision of the Nutrition and Supplement Facts Labels”, which was proposed by the Food and Drug Administration. The memo will be broken down into three different paragraphs. The first major point of the memo will be the background and the summary of the rule. The second point will be about the industries impacted by this rule and other important information about it, such as the most important changes of the rule. The third point will be an extended discussion of what affected companies/industries will have to do should this rule go into effect. Such allocation of the information will help to better understand the main points of the rule and how does it affect many companies.

The company has shown through its ratios that it is stable. It has not been increasing nor decreasing, but has remained the same. However, in the past three years it is perceived that the company is declining. In the year 2015 the company made nearly $1.5 million in revenue and $64,575 in net income. Going by the previous two years, 2013 and 2014, it looks like the company is declining but looking at revenue and net income from 2010, it is noticeable that the company has come a long way. In 2010, Glatfelter reported 1.4 million in revenue and only $54,434 in net income. Going as far back as a decade ago revenue was only $579,121 and net income was 38,609. This only demonstrates that the company is growing significantly and has come a long way. In fact, the company has shown outstanding business performance over the last ten years. Financial

The firm’s accounts receivable ratio increased from 68.71 in 2006 to 74.56 in 2010. This means that it is taking Abbott almost six days longer to collect from its customers today than it did five years ago. Furthermore, the firm’s accounts payable days has decreased from 43.72 in 2006 to 38.22 in 2010. This means that Abbott is paying its suppliers 5½ days earlier today than it did in 2006. A change in the inventory ratio from 8.01 in 2006 to 11.03 in 2010 indicates that it is taking the firm longer to sell finished goods than it used to. The increase in the accounts receivable and inventory ratios, combined with a decrease in the accounts payable ratio, indicates poor working capital management and helps to explain why the firm has increased its holdings of cash and short-term investments. To correct this, Abbott’s managers should focus on collecting cash from its customers faster and delaying payments to its suppliers. To maximize its cash position, the firm would be best served by paying its suppliers in the same amount of time as it collects payment from its customers.

These are strike years so we will ignore them. In 1994, ROE is less than that of last three years. Overall its not good sign, but its explanation will be given in upcoming ratios.

- The financial statements for the past three years show a decline trend in both the operation and return on shareholder of the company, so a closer look at the factors contributing to this decline is needed.

It’s noticeable how the company’s operations have been deteriorating as they are having a more difficult time translating sales into cash. Their A/R turnover is not where it needs to be, and in line with that, their liabilities are increasing as well. The company has also been inefficient with the use of their assets as their current activity ratios are not up to par with the industry standards.