ssey-Louis Vuitton S.A. are FRS end. How mig ng EYK4-11. Evaluating Firm Liquidity, Solvency, Profitability and Free Cash Flow: IFRS Fina Statements The 2017 financial statements of LVMH Moet Hennessey-Louis Vuitton SA presented in Appendix C at the end of this book. LVMH is a Paris-based holding company and one of the world's largest and best-known luxury goods companies. As a member of the European Union, French companies are required to prepare their consolidated (group) financial statements using International Financial Reporting Standards (IFRS). Using this financial data, calculate the company's (a) return on sales ratio using net profit, group share, (b) current ratio, (c) debt-to-total- assets ratio, and (d) free cash flow for 2016 and 2017. Comment on the trend in LVMH's liquidity. solvency, profitability, and free cash flow from 2016 to 2017. SET TON 2017 2016 Better or worse? Return on Sales Current ratio b. Debt-to- total assets Free Cash Flow 0-3 Aependien tes CONDENSED CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEET 2017 2016 ASSETS 13.305 10,001 12139 Brands and other in Goodwill Property plant and equipment nements in joint ventures and sociales Non-current table for at financial sets Other non-current assets 1.738 2,058 40.224 Non-current assets 47.458 10,908 2.737 10.50 2.685 Inventories and work in progress Trade accounts receivable 2.143 3,544 Other current assets Cash and cash equivalents Current assets 2.919 2738 21,082 6.550 19,398 18,990 59622 59.622 57 Total assets Notes 2017 2016 2015 15.1 152 15.1 2.614 2579 LIABILITIES AND EQUITY EUR millions Share capital Share premium account Treasury shares and LVM share-settled derivatives Cumulative translation adjustment Revaluation reserves Other reserves Net profit. Group share Equity Group share Minority interests 15301 357 1472 19.658 152 2601 15201 1.165 1.049 17,965 3.981 14 16.99 5,129 26,393 2009 28.852 1,408 1510 27,903 3,932 25.799 4511 30,260 7,046 2,474 3.910 9,857 2342 4,137 8.498 150 45 7,997 Equity Long-term borrowings Non-current provisions Deferred tax Other non-current abilities Non-current liabilities Short-term borrowings Trade accounts payable Income taxes Current provisions Other current liabilities 23,287 18.909 19.100 3,769 3,447 4.184 3560 4,530 4,540 763 404 4,766 428 352 4.399 421 21.2 Current liabilities 2909 15,003 12,810 12,899 Total liabilities and equity 68,550 59,622 57,601 CONDENSED CONSOLIDATO FINANCIAL STATEMENTS SOLIDATED STATEMENT OF CHANGES IN EQUITY 20.000 552,137 11.12 507,138,110 152 2379 130 2 3 134 1920,9511 in and fina dividends paid luisson and disposa Shares 118 117 21.1 26 1,510 20 5201 116 7 12 2.801 As of December 31, 201 Bains and recognized 5,129 5129 129 121113 Compre income Shocktion plan sonido OM sharested derivatives Lerchef sorption options Rental LVMH shares Dit momentaries Hemand final vidends paid Dhanges in control 709495 791,9771 12.7100 12,1101 12:00 12:370 1 14 187 154 1129292911 1134787 2052 112 15 2016 3111 0 357 As of December 31,2017 07042.596 Agend Fram es for SOLIDATED LVMH MHS Won ANCIAL STATEMENT CONDENSED CON SOLIDATED INCOME STATEMENT CONSOLIDAY an except for camins personal 2015 35.4 1125531 Castelsales Cross margin 2017 4235 114,7831 27,953 116,3951 91500 113,00 26,561 11 12,9311 22,111 113.00 12. 31 homeos from ting and selling expenses and administrative expenses oss from joint ventures and associates from recurring operations operating income and expenses 7,026 12211 1221 1180 Operating profie 8,113 1.21 11171 1831 1792 13361 0493 Cost of net financial debt financial income and expenses Met financial income lexpense) 14321 12.1091 4,363 11.9691 hcometres 4.001 11791 12:31 5,616 14871 5,129 et profit before minority interests Minority interests Neprolit, Group share 14:20 3,981 7.11 28 10.21 502 412 694 7.92 502,911,125 502.395.491 Basic Group share of net earnings per share EUR Number of shares on which the calculation is based Duted Group share of net earnings per share EURI ber of shares on which the calculation is based 10.18 504010,291 504600459 504,894946 2015 2016 2017 CAGONWID CONSECARACAL STATEMENTS 6.384 6,906 150 CONSOLIDATED CASH FLOW STATEMENT 2:31 2.143 11771 11551 8.733 1661 7,905 and OPERATING ACTIVITIES AND OPERATING INVESTMENTS s nd 10.404 11.07 Corting from Incand video News a 6,083 12.790 7546 11.923 6,751 15122 one before changes in working capital 15141 Cash from 6.299 7,030 12.776 12.2651 3.974 5.634 11.955 3.679 i ng activities before changes in working rom Met 4754 1281 1781 11251 87 14611 120 16.304 16.3311 1821 15111 35 Nutcash romperting activities Merchrom ating acties and operating investments. cash flow FINANCIAL INVESTMENTS Purchase are able for sale financial P edrom sale of current for sale fancial assets Dudends received Tax o n-current for sale francis and consolidated investments Impact of purchase and sale of consolidated investments Netcash from used in financial investments IL TRANSACTIONS RELATING TO EQUITY Capc ases of LVMH SE Capital increases of subsidiaries subscribed by minority interests Acouston and disposals of treasury Shares and LVMH share-settled derivatives Interim and final dividends paid by LVMH SE Tuxpaid related to interim and final dividends paid Intermand Saldividends paid to minority interests 81 1671 12.1101 13521 11.8101 11451 11,6711 1304 12281 12591 11531 12,104 13,6811 12671 195 12,5641 1,328 12,0901 1,078 in consolidated subsidiaries Purchase and proceeds from sale of minority interests Net cash from used in transactions relating to equity Change in cash before financing activities IV. FINANCING ACTIVITIES Proceeds from borrowings Repayment of borrowings Purchase and proceeds from sale of current available for sale financial assets 5,753 11.7661 913 12,1341 1,008 12.4431 (113) 11,4381 4,076 1114 11,334) 147) Netcash from used in financing activities K EFFECT OF EXCHANGE RATE CHANGES NET INCREASE IDECREASE IN CASH AND CASH EQUIVALENTS --IV-V] CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD CASH AND CASH EQUIVALENTS AT END OF PERIOD (53) 141 (3931 3,783 3.390 11 3,337 3,618 12.4021 3,390 3,337 TOTAL TAX PAID w from sale of currentlable for sale franceses 12,3761 (2,5291 e lche Purchase and