Review the Heinz Company income statement, balance sheet, and cash flow to determine the financial health of the company. Be sure to compare Heinz to at least two other companies in the industry. Be sure to answer the following:
- What have you learned about the company by reviewing each statement?
- Is there information in any of these statements that concerns you? If so describe what it is and what it concerns.
- How can management use this information moving forward?
Summarize the company's financial health. How does it compare to other companies in the industry?
Include a summary of the company's technological advantages, or lack thereof, in comparison to at least two other companies in the same industry.
Conduct a benchmarking analysis. Be sure your analysis includes the following in comparison with other companies in the same industry:
- Best practices
- Operational processes and procedures
- Products or services
Heinz is the global leader in the food industry. This paper deals with the analysis of financial statements and cash flow statements and benchmarking analysis. We will be also explaining about the impact of globalization on strategies of the business of the company. This paper also helps in explaining the comparison of financial statements of Heinz with that of ConAgra and Compbell company.
Review of Heinz's Income statement reveals that the gross profit margin of 0.36 is higher than the industry average of 0.25 as on October 2012. The growth in revenues has declined to -1.50% quarterly YoY bases, as compared to the industry average of 51. 90%, ranked 70 among 151 companies in the industry. Gross profit for the year 2011 -2012 is $ 3999530 with total revenue of $ 11649079. The net income in the year 2011 -12 is $ 923159 (H. J. Heinz Company, 2012).
The balance sheet of the company, reveals the market capitalization of 18.48 billion, is much higher than the industry average of 576.30 million, which indicates that Heinz has a large market share. It also represents that the company has the EPS of $ 2.96, which is much higher than the industry average, and indicates that the company has the sound financial position in the market. The current ratio of 1.16 indicates that the company has enough current assets to pay off its current liabilities. (H. J. Heinz Company, 2012).
The cash flow statement indicates the inflow and outflow of cash from the organization and the true value cash remained at the end of the year. It reveals that there is a cash outflow of $ 402,005 from investing activities. There is a cash outflow of $362,835 from financing activities because of payment of dividend and purchase of stock. There is a cash balance of $ 606130. Thus, the financial statements as well as cash flow statement Heinz reveals that the company is enjoying goodwill in the market because of its sound financial position (H. J. Heinz Company, 2012).
In the below section we will be discussing the need and importance of analysis of financial statements to the management and other stakeholders. We will also demonstrate the comparison of Heinz's financials with that of Compbell Soups and ConAgra Foods.
The information provided in the financial statements of Heinz is extremely useful for its stake holders because it helps them to know its financial position in the market. The payment of the dividend by the company to its shareholders is useful to them because it has influences on their decision regarding selling of equity shares in the market. As a customer, the information relating to revenues generated from ...
The expert examines a company's income statement. How management used information to move forward are determined.