Kota Fibres Ltd Case Analysis Essay

Given our analysis of the motion picture industry, we recommend that Arundel carefully select the major film studios from which they intend to purchase sequel rights. The net present value of hypothetical sequels taken from the available previous years shows not only that the industry is highly volatile, but also that certain production studios are more volatile than others in terms of their recent performance. In addition, some studios are consistently less profitable than others. (See "NPV for Each Production Company" chart in appendix) Since the success of film studios are relatively stable in the short term (see "Rental Shares of Major Film Distributors" table and graph) Because of this stability, it is possible for Arundel to approach more profitable studios with their offer to purchase sequel rights. Out of all the major film studios, only MCA-Universal, Warner Bros., and The Walt Disney Company generate a positive net present value on a per-film basis. However, according to casual inquiries, it is unlikely that any movie studio would enter negotiations with Arundel on a per film price that is less than 1 million. Instead, the film studios seem to

1. Key success factors & company performance…………………………………………………..3 2. Bank perspective regarding the performance…………………………………………………..7 3. Bank financing perspective at the end of 1998……………………………………………….10 4. Management perspective regarding the bank financing………………………………….13 5. Exhibit 1 – Annual Income Statements (1994-1997)………………………………………17 6. Exhibit 2 – Annual Balance Sheets (1994-1997)……………………………………………..18 7. Exhibit 3 – Quarterly Income Statements 1997……………………………………………….19 8. Exhibit 4 – Quarterly Balance Sheets 1997………………………………………………………20 9. Exhibit 5 – Forecasting………………………………………………………………………………………21 10. Exhibit 6 – Annual Ratios………………………………………………………………………………….22 11. Exhibit 7 –

- We believe that breaking out the data by studio is an advantage because it provides direction.

Increase in current liabilities Substantial increase in current liabilities weakened the company’s liquidity position. Its current liabilities were US$2,063.94 million at the end of FY2010, a 48.09% increase compared to the previous year. However, its current assets recorded a marginal increase of 25.07% - from US$1,770.02 million at the end of FY2009 to US$2,213.72 million at the end of FY2010. Following this, the company’s current ratio declined from 1.27 at the end of the FY2009 to 1.07 at the end of FY2010. A lower current ratio indicates that the company is in a weak financial position, and it may find it difficult to meet its day-to-day obligations.

Lawsons’ liquidity ratios may be alarming to the bank. The company’s ability to repay short-term debt has significantly deteriorated over their four year span to the point where the company is almost unable to operate. This is defiantly a fragment of the company that the bank will have to take a deeper analysis on.

The plaintiff, Ms. Madeena Sandhu, was hired by Solutions 2 Go Inc. on November 7, 2005. Around June 2006, the defendant, Solutions 2 Go announced a profit sharing bonus plan for its employees, however, it was not in writing. Solutions 2 Go’s fiscal year is from April 1 to March 31. Employees who worked for the full fiscal year received a full share of the profit sharing bonus. Employees who worked more than 6 months, but less than a year received ½ of the share and those who worked less than 6 months received no share. Sandhu’s share of the profit sharing bonus was a very “significant financial part of her overall compensation” from Solutions 2 Go. On May 25, 2010, Ms. Sandhu was terminated and no cause was alleged. There was no disagreement that The Employment Standards Act, 2000 (“the Act”) applied to Ms. Sandhu. Instead of a notice, she was given a 4 weeks pay, vacation pay and group insurance until June 22, 2010, as said in the Act. On June 18, 2010 Solutions 2 Go announced the 2010 fiscal profit sharing plan bonus and paid its employees. Ms. Sandhu received no share of the profit sharing bonus, despite being employed for the entire fiscal year, which ended on March 31, 2010 so she filed for a motion for summary judgment. The full share for the employees who were employed for the entire 2010 fiscal year was $16,055. In December 2010, the company tried to make its employees to

This case discusses Cross-Border valuation of projects. This kind of analysis is common for companies that are operating in many countries. Groupe Ariel is one such company that is considering investing in a project in its own subsidiary in Mexico. The company manufactures and sells printers, copiers and other document production equipment in many countries. As far as, expansion into new markets is concerned, company is very slow in taking initiatives as compared to its competitors owing to the recent recession. But the management of the company believes that better durability and lower after-sales service costs of their products enable

and, even if successful, such alternative actions may not allow us to meet our scheduled debt service obligations. In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. These restrictions may limit the ability to engage in acts that may be in company’s long-term best interests, and may make it difficult for the company to execute their business strategy successfully or effectively compete with companies that are not similarly restricted.

| It’s having massive impact on the liquidity of the company (20% of the company’s revenue) and the trade receivables collection period.

Moreover, operating expenses were estimated to be 6 percent of sales in 2001, a figure higher compared to last year’s. Interestingly, this was due to the addition of a quality-control department, for which there had been no indications of a need for one, and the three young nephews of Mrs. Pundir, in whom she hoped to build an allegiance to the family business. She also proposed to pay dividends of Rs500,000 per quarter to only 11 individuals who held the entire equity of Kota Fibres, Ltd. Incidentally, these 11 individuals were members of her extended family.

The analysis of revenue will not be the basis in long term strategic planning as they are only based from a year of proceeds and returns. SRC’s original financial information gives a devastating revenue therefore, the change of plan is imperative in order to maximize net worth. It is important to give an attention of the assets and liabilities, create and developed projection with a balance estimation.

Q1.Based on the 2004 statement of profit and loss data (Exhibits 1 and 2), do you agree with Water’s decision to keep product 103?

Optical Fiber Corporation (OFC) is a financially successful, albeit relatively small manufacturer of multimode optical fibers. The company was founded in 1990. The founders were able to enter the market largely on the basis of acquiring patent licenses from larger optical fiber firms. These licenses restricted competition between the entities and provided OFC with instant access to optical fiber technology. In return, OFC’s customer base is limited by the license agreements and royalties of 7% on sales of licensed products (recently renegotiated to 9%) are paid to the licensors. Despite these handicaps the firm has grown in size and profitability. OFC makes several types

Shimano is a manufacturer of mechanical bike components for mid- to high-end road bikes. They do not make frames and they do not sell directly to customers via retail stores, but rather to bike manufacturers that want to use Shimano’s components. They have been, by far, the leader in their industry for years. They netted around a 14 percent profit margin, dwarfing that of almost all bike manufacturers, and did so using their many competitive advantages over rivaling brands.

BBC’s working capital policy was too conservative. This is apparent in their high level of net working capital with more than 4.2 million in 2010-2011 fiscal year. Although, the net working capital was in the positive figures, their assets were 10 time more than their liabilities. When further reviewing this figure it is because they have a large amount of inventory and accounts receivable. Their liquid assets to total assets ration was between 62% and 66%. Where industry bench marks are 30%.