Task:
So far, you have had some ideas of Next’s recent operating outcomes from your first reflection note. This follow-up reflection note requires you to critically evaluate Next’s operating strengths and weaknesses and financial risk based on 5 factor DuPont model introduced in the module. Your analysis should cover the accounting period from the year ended January 2019 to the year ended January 2022, bearing in mind that there was an accounting standard revision (IFRS 16) in 2019 fiscal year. The ratios involving the balance sheet items should be based on the average balance sheet amounts for the relevant analysis.
The report must include the analysis of the following aspects:
- Analyze the extent to which Next’s (1) working capital contributes to and (2) Capex supports its core operations in order to maintain its competitive positioning. You must analyse and evaluate the case firm’s working capital policies and growth strategy
[40 marks]
- Summarize Next’s operating strengths and how it manages and/or overcomes challenges. You must connect the summary of the case firm’s operating outcomes from the first assignment to the above working capital management and/or Capex plans with relevant well-edited tables, diagrams, and/or graphs. Pay attention to self-plagiarism, which is also a serious academic misconduct.
[15 marks]
- Evaluate Next’s financial risk. The analysis should incorporate free cash flows (FCF).
[10 marks] - A concluding remark [5 marks]
- Demonstration of technical calculations in Appendix of the report. Do not attach excel files with your assignment PDF file.
[20 marks]
- Presentation, citations, and references. Particularly, all relevant figures and indicators in the main body of the report should be nicely edited. Do not copy and paste from the original sources.
[10 marks]
