2 .How would you summarize the companys financial status? How does it reflect the business development goals and strategies employed by Mrs. Cheung? NDP has been investing at an incredible pace best demonstrated by comparing the companys cash flows from operating activities in 2007 and 2008 with the cash flows from investing activities. NDP has clearly been profitable in recent years, and demonstrates a high rate of profitability one would not ordinarily see in this type of semi-commodity based business NDPs rate of profitability, however, has been sliding, reflecting rising input prices and greater competitive markets for its products The companys growing debt burden is large and getting larger .
3. Is NDP in trouble? How would your answer differ if you were an existing shareholder, a potential investor, or an analyst? The company still appears to be marginally profitable in this difficult business environment,but profitability is a concept which focuses more on the corporate income statement, not cash flows. The result is that it appears the company will need to borrow even more to survive the year. ¢ Existing shareholders are clearly down, and would like to see the company executive management take measures to improve share price sooner rather than later. They are, however, minority shareholders, Mrs. Cheung and family holding more than 70% of the firm. ¢ Potential investors might see the company has a good bet, given the current share price low and the prospects for long-term competitiveness .