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Posted on Jul 15, 2024

3. LonzaTech (20 points). Lonza's shareholders have raised some serious questions about the recent financial performance of the firm. Although sales and profits have been

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3. LonzaTech (20 points). Lonza's shareholders have raised some serious questions about the recent financial performance of the firm. Although sales and profits have been growing, they do not believe that the company is being managed efficiently. You have been brought in as an independent financial consultant to provide an evaluation. LonzaTech Corporation Statement of Cash Flows (000s of euros) LonzaTech Corporation Selected Financial Results(000s of euros) 2018 6,588 2019 5.510 9,190 4,800 (3.693) (995) 9,302 9,460 5,700 (16,110) (1.454) (2.404) Opening Cash Balance Cash Flow from Operations EBIT Depreciation Change in NWC Taxes Cash flow from operation activities Cash Flow from Investing Capital expenditure Net zquisition of assets Purchases or sales of securities Cash flow from investing activiites Cash Flow from Financing Interest payments Dividend payments Change in long-term debt Change in short-term debt Changes in equity Cash flow from financing activities Sales EBITDA EBIT Net Income Cash Accounts receivable Inventory Accounts payable Long-term debt Short-term debt Equity 2018 187,500 13,990 9,190 5,225 7,750 24,800 29,450 15,500 5,200 18,580 39,165 2019 214,900 14,260 9,460 5,304 2,400 33,325 42,550 19,850 8,922 27,774 41.986 (2.240) (5.075) (2.240) (5.075) (2.970) (4.810) (1,040) 680 (6.125) (5,100) 3.722 9,194 (8,140) 1,691 a. What is your opinion regarding Lonza's management of working capital? Use the data presented to support your analysis. b. What is your assessment of Lonza' use of debt? Use the data. c. What is your assessment of Lonza's financial health based on its cash flows? Use the data. 3. LonzaTech (20 points). Lonza's shareholders have raised some serious questions about the recent financial performance of the firm. Although sales and profits have been growing, they do not believe that the company is being managed efficiently. You have been brought in as an independent financial consultant to provide an evaluation. LonzaTech Corporation Statement of Cash Flows (000s of euros) LonzaTech Corporation Selected Financial Results(000s of euros) 2018 6,588 2019 5.510 9,190 4,800 (3.693) (995) 9,302 9,460 5,700 (16,110) (1.454) (2.404) Opening Cash Balance Cash Flow from Operations EBIT Depreciation Change in NWC Taxes Cash flow from operation activities Cash Flow from Investing Capital expenditure Net zquisition of assets Purchases or sales of securities Cash flow from investing activiites Cash Flow from Financing Interest payments Dividend payments Change in long-term debt Change in short-term debt Changes in equity Cash flow from financing activities Sales EBITDA EBIT Net Income Cash Accounts receivable Inventory Accounts payable Long-term debt Short-term debt Equity 2018 187,500 13,990 9,190 5,225 7,750 24,800 29,450 15,500 5,200 18,580 39,165 2019 214,900 14,260 9,460 5,304 2,400 33,325 42,550 19,850 8,922 27,774 41.986 (2.240) (5.075) (2.240) (5.075) (2.970) (4.810) (1,040) 680 (6.125) (5,100) 3.722 9,194 (8,140) 1,691 a. What is your opinion regarding Lonza's management of working capital? Use the data presented to support your analysis. b. What is your assessment of Lonza' use of debt? Use the data. c. What is your assessment of Lonza's financial health based on its cash flows? Use the data