Industry Analysis 20074076

20074076 Park dongwook BusinessCom 2.0/Winter09/COMPANY FINANCIAL MATRIX COMPANY: Dell INCOME STATEMENT Revenue ($mil.) Gross Profit ($mil.) Operating Income ($mil.) Total Net Income ($mil.) EPS STRENGTHS:

2009 61,101.0 10,957.0 3,417.0 2,478.0 1.25

2008 61,133.0 11,671.0 3,872.0 2,947.0 1.31

2007 57,420.0 9,516.0 3,390.0 2,583.0 1.14

The growth in 2008 has been plunged, due to the global economy downturn. However, the net profit of the industry has been increased by 15% and 9% for EPS. This shows that the stock price and market is growing, and business performances are satisfactory.

WEAKNESSES

Although the net income has been decreased by -4%, which is disappointing, however, it is a relatively minor issue, considering the global financial crisis in 2008.

CASH FLOW STATEMENT Net Operating Cash Flow ($mil.) Net Investing Cash Flow ($mil.) Net Financing Cash Flow ($mil.) STRENGTHS:

Jan 09 1,894.0 177.0 (1,406.0)

Jan 08 3,949.0 (1,763.0) (4,120.0)

Jan 07 3,969.0 1,003.0 (2,551.0)

The loss of ICF and FCF in the period of January 08 to January 09 has been significantly decreased. This is of course lower, compare to 07, but this is an absolute growth.

WEAKNESSES

Overall, it has been bear market about 50%, however, this is an inevitable result, considering global financial crisis.

BusinessCom 2.0/Winter09/COMPANY FINANCIAL MATRIX (Page 2/3) COMPANY: DHL INCOME STATEMENT Revenue ($mil.) Gross Profit ($mil.) Operating Income ($mil.) Total Net Income ($mil.) EPS STRENGTHS:

2008 76,781.1 31,706.7 2,377.8 2,789.4 1.97

2007 93,483.3 39,207.0 4,695.4 2,774.5 1.69

2006 79,877.0 34,820.3 -2,527.8 --

From the chart, net profit and EPS have shown a significant increase, however, our research shows that Fedex, our competitor, has shown the -95% in net profit and -10% in EPS. Furthermore, many other relevant elements have proven that DHL had performed beyond Fedex.

WEAKNESSES

Although the net profit for 2006 has not been shown in the figure, it is predictable from the other figure. It has been shown about -50% of loss, comparing with 07 and 08 profit figures, however, it would have been much lower figure, if 06 figure was also used, which is predictable.

CASH FLOW STATEMENT Net Operating Cash Flow ($mil.) Net Investing Cash Flow ($mil.) Net Financing Cash Flow ($mil.) STRENGTHS:

Dec 08 2,733.0 621.6 2,069.1

Dec 07 7,581.8 (1,108.3) (3,071.9)

Dec 06 4,253.4 (3,558.2) (622.7)

The marginal increase for FCF and ICF is much greater. The increase in FCF can prove the fact that share market and bank loans are expanded. It can be derived from the fact that the size of the bank loans is also considered in corporate growth prediction model.

WEAKNESSES

The cash flow has been decreased, due to the profit from the performance. This is because depreciation/amortization, tax, inventory, and account payables are weakened.

BusinessCom 2.0/Winter09/COMPANY FINANCIAL MATRIX (page 3/3) COMPANY: Lockheed Martin INCOME STATEMENT Revenue ($mil.) Gross Profit ($mil.) Operating Income ($mil.) Total Net Income ($mil.) EPS STRENGTHS:

2008 42,731.0 4,649.0 5,043.0 3,217.0 7.86

2007 41,862.0 4,234.0 4,720.0 3,033.0 7.10

2006 39,620.0 3,434.0 3,953.0 2,529.0 5.80

It has shown an outstanding performance, such as 80% growth in Sales revenue, 35% increase for gross profit and EPS. The competition with Boeing had been very strong and successful, and this would have led that the Weaponry division would have achieved a significant growth. Currently, the company is manufacturing the world strongest Jet Fighter, F-22, and all the other global conflicts have led increased budget for multi-purpose weaponry, which is one of the strong external growth element. The constant growth in the figures would prove that.

WEAKNESSES

From the figures, there are no presences of any weakness for this company. However, it could be out of control, if the highly growing company would turn down, the only necessary risk management for this matter should be considered.

CASH FLOW STATEMENT Net Operating Cash Flow ($mil.) Net Investing Cash Flow ($mil.) Net Financing Cash Flow ($mil.) STRENGTHS:

Dec 08 4,421.0 (907.0) (3,938.0)

Dec 07 4,241.0 (1,205.0) (2,300.0)

Dec 06 3,783.0 (1,655.0) (2,460.0)

Both OCF and ICF show the growth, especially 50% increase in ICF, which is due to the increase in investment. This is mainly due to the increased cash inflow by increased investment.

WEAKNESSES

FCF, Free Cash Flow from the financial activity, is the only cash flow that shows negative increase. Our research could not see beyond this level, however, our assumptions for this issue are FCF might have affected by managerial decisions, such as paying the loan to reduce interest costs and increased cash dividend payment/share buyback to increase the value of the shares.