Question

Review and analyse Cash Flow Statement of Vodafone and DT.

Specify your key observations.

Answer 1

We'll discuss over DT( Deutsche Telekom) Cash flow statement, and we'll discuss about Cash flow from operations as in below:

Observations:

It's notable that Profit before taxed paid has been increased from 4547 to 5153 a consistent improvement from 2016 to 2018. Depreciation losses have come down from 14586 to 13386. Profit from financial activities have come down from 4390 to 2848. Dividends received has been decreased over three years from 331 to 181.

Observations:

Property, plant and equipment has been increased from 379 to 532 which means the demand for the product has been raised. Non current financial assets includes borrowing money and payback the remaining loans, which is decreased here , which is a good sign. Overall net cash used in investing activities has been decreased from 16,814 to 14297 which is indicating that there are more investing activities going on within the company.

Observations:

Financing activities occur among debt, equity, and dividends which indicate the health of cost of capital of the firm. By the above financial statement of Cash flow, we can say repayment of current financial liabilities has been raised which is indicating that the company is paying negative liability as it's paying more than the required liability, indicates a delay in the payments.

Now we'll make observations over Vodafone Cash flow statements as below:

Observations:

Changes in working capital has decreased in it's value from 2214 to 554 from 2017 to 2019. Issuance of debt has been increased which is that company is growing it's dependency on raising the debt. Capital Expenditure has been twice the amount from 2017 to 2019. Cash from financing activities has shown it's progress from a negative balance to the positive where this shows the increased activity in financing.