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financial statement analysis case - Kellogg Company -Chapter 3 compute the percentage change in sales, operating...

financial statement analysis case - Kellogg Company -Chapter 3 compute the percentage change in sales, operating profit, net cash flow less capital expenditures, and net earnings from year to year for the years presented and evaluate Kellogg's performance. which trend seems most favorable: which trend seems least favorable? what are the implications of thesese trends for Kellogg's sustainable performance objectives

                                              2014                           2013                  2012

sales                                 14,580                             14,792                  14,197

Gross profit %                     34.73                               41.26                    38.28

operating profit                   1,024                               2,837                   1,562

net cash flow less CE         1,211                               1,170                   1,225 CE = capital expenditures

net earnings                            633                               1,808                    961

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Data Given: 2014 2013 2012 $14,580 $14,792 $14,197 Sales Gross profit % Operating profit Net cash flow less CE Net earnings 34.73% 41.26% 38.28% $1,024 $2,837 $1,562 $1,211 $1,170 $1,225 CE capital expenditures $633 $1,808 $961 2014 2013 1.43% 4.19% [2014-($14,580-$14,792) / $14,792; 2013-($14,792. $14,197)/ $14,197] Gross profit 96 15.83% 7.78% [2014-(34.73%-41.26%) / 41.26%; 2013 : (41.26%-38.28%) / 38.28%) Operating profit -63.91% 81.63% [2014-($1,024-$2.837) / $2,837; 2013-($2.837-$1,562) / $1,562]Net cash flow less CE 3.50% -4.49% [2014-($1,211-$1,170) / $1,170 2013-($1,170-$1,211)/ $1,211] Net earnings 64.99% 88.14% [2014-($633-$1,808) / $1,808; 2013-($1,808-$961) / $961] Trend Analysis: Net cash flow less CE shows a favorable trend as its increase % was-4.49% in 2013 whereas it became 3.50% in 2014; Sales, Gross profit %, operating profit & Net earnings show an unfavorable trend as their respective increase %s were positive in 2013 whereas the same became negative in 2014. As Sales, Gross profit %, Operating profit & Net earnings are the key factors for Kelloggs sustainable performance objectives and these were showing negative trend, Kelloggs sustainable performance is not impressive However, as net cash flow less CE shows a positive trend, Kellogs cash generating abillty ls Iimpressive

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