FINANCIAL STATEMENT ANALAYSIS: Using the annual report of a2 milk Company, for 2014-2015,

(Annual report link:

https://www.thea2milkcompany.com/2014-2015-annual-report-2/

Additional materials: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11599487

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11600214 ) answer the following questions.

Required: 1. Using the consolidated accounting information, Compute all the ratios that fall under the following categories for the year ended 30/6/15 and for the previous year:

a. Liquidity

b. Capital structure

c. Asset management efficiency

d. Profitability

e. Market value

2. Based on the ratios computed above, write a comprehensive report to the management of a2 milk Company, evaluating the overall financial health of the company in comparison to the prior year. (Your report should synthesise all information obtained from the ratios and arrive at an overall conclusion reflecting industry knowledge rather than interpret each category of ratios independently. You report, in addition to the evaluation of financial health of the firm should also cover the following:

i. The companys ability to generate cash flows in the future

ii. Its future external financing needs (Maximum 1000 words excluding appendices)

3. Assume you are a banker evaluating a loan request from a2 milk Company for $ 150 million. What would be your concerns when making a decision regarding approval or denial of the loan request? Justify. (Maximum 750 words excluding appendices)

4. Assume you are an investor in the shares of a2 milk Company and rely on receipt of regular cash dividends as part of your return on investment. You have $ 200,000 available for investment which is currently deposited in a term-deposit at an interest rate of 5.2% per annum which you would like to utilise to buy additional shares in a2 milk Company. The companys shares are trading at an average price of $1.80 per share. What would your decision be? Justify. (Maximum 750 words excluding appendices)