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Hastings AB is a software firm that has never paid a dividend before but its boards of directors are considering whether to initiate dividends and

Hastings AB is a software firm that has never paid a dividend before but its boards of directors are considering whether to initiate dividends and if so, how much to pay. You have collected the following information on the firm:



- The most recent years income statements is as follows:

Revenues SEK 532 million

- Cost of goods sold SEK 372.4 million (includes depreciation of SEK 40 million)

EBIT SEK 159.6 million

- Interest expense SEK 10 million

Taxable income SEK 149.6 million

- Taxes SEK 41.888 million

Net Income SEK 107.712 million


- The revenues, operating income and depreciation are expected to grow 10% a year for the year, the tax rate for the company will be 28% of taxable income for the year.

- The non-cash working capital is currently 20% of revenues and this ratio is expected to not change over the year.

- The firm reported capital expenditures of SEK 50 million last year, a level that will be maintained for the year.

- The firm has an old bank loan of SEK 20 million (which is the firms only debt) and it is expected to pay off the entire loan at the end of year.

- The firm is planning one major acquisition next year and it expects the acquisition to cost SEK 50 million.

- The current cash balance of the firm is SEK 75 million.

If no dividend is paid out. What is the Cash Balance at the end of year one?

Answer with two decimals.

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