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Evaluating Financial Health Evaluating Financial Health xxxxxxx Axia College of University of Phoenix 1 Evaluating Financial Health 2 Evaluating...

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Evaluating Financial Health 1 Evaluating Financial Health xxxxxxx Axia College of University of Phoenix
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Evaluating Financial Health 2 Evaluating Financial Health The International Telephone & Telegraph company (ITT Corp) can traced its beginnings back to the year 1920, when two brothers set out to build the first interconnected telephone lines company (ITT, 2008). The company has expanded ever since then, currently employing over 40,200 people and forming part of vital markets such as the water and fluids management, global defense and security, and motion and flow control. ITT is a worldwide company rating number three out of its main competitors, Lockheed Martin Corporation and Raytheon Co. (Yahoo Finance, 2010) ITT did not have a good start in the year 2009, the first quarter its cash flow decreased by 11% when comparing it to the year 2008. However, they managed to decrease significantly their net debt and commercial papers, as it could be appreciated in the quarters to follow. Improvements were made evident in the 2 nd quarter, cash flow increased, once again in comparison to 2008 2 nd quarter, and net debt and commercial paper continued to decreased. On the 3 rd quarter, ITT had paid all of its commercial paper, decreased its debt to 8.5% and continue increasing its cash flow. On Feb 3, 2010, the company released their 4 th quarter report for 2009. Although, ITT had small set backs on the 2 nd and 3 rd quarters on overall revenue, they got back on track the 4 th quarter. By the end 2009, ITT had increased its cash flow by 22% in comparison to 2008 and reduced its net debt to capital from 27.9% in 2008 to 7% in 2009 (ITT, 2010). According the financial statements for the end of year 2009, ITT seem to have managed to keep its accounts receivables under control which contributed in their increased in total assets. Despite their slide decrease in sales the company managed to increase its revenue by reducing some of their expenses. Although the Form 10K has not been officially released as of today, it is safe to say that one of the most positive highlights for the company was the decreased on short-term debt and current
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