LUCENT TECHNOLOGIES INC.?

Executive Summary

We design and deliver the systems, software

and services that drive next-generation communications

networks. Backed by Bell Labs

research and development, we use our

strengths in mobility, optical, access, data and

voice networking technologies, as well as

services, to create new revenue-generating

opportunities for our customers, while

enabling them to quickly deploy and better

manage their networks. Our customer base

includes communications service providers,

governments and enterprises worldwide.

We have three segments organized

around the products and services we sell.

The reportable segments are Integrated Network

Solutions (“INS”), Mobility Solutions

(“Mobility”) and Lucent Worldwide Services

(“Services”). INS provides a broad range

of software and wireline equipment related

to voice networking (primarily consisting

of switching products, which we sometimes

refer to as convergence solutions, and voice

messaging products), data and network

management (primarily consisting of access

and related data networking equipment

and operating support software) and optical

networking. Mobility provides software and

wireless equipment to support radio access

and core networks. Services provides deployment,

maintenance, professional and managed

services in support of both our product

offerings as well as multi-vendor networks.

Beginning in fiscal 2001, the global

telecommunications market deteriorated,

resulting from a decrease in the competitive

local exchange carrier market and a significant

reduction in capital spending by established

service providers.This trend intensified

during fiscal 2002 and continued into fiscal

2003. Reasons for the market deterioration

included general economic slowdown, network

overcapacity, customer bankruptcies,

network build-out delays and limited availability

of capital.

We believe that the market for telecommunications

equipment has stabilized

and is starting to grow in certain areas. The

growing demands of enterprises and consumers

for additional services tailored to

their needs is creating the need for a new

convergence of networks, technologies and

applications.

Required

1. Using the Consolidated Balance

Sheets for Lucent Technologies for

September 30, 2004 and 2003, prepare

a common-size balance sheet.

2. Evaluate the asset, debt, and equity

structure of Lucent Technologies, as

well as trends and changes found on

the common-size balance sheet.

3. What concerns would investors and

creditors have based on only this

information?

4. What additional financial and nonfinancial

information would investors

and creditors need to make investing

and lending decisions for Lucent

Technologies?

LUCENT TECHNOLOGIES INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in Millions, Except per Share Amounts)

September 30, September 30,

2004 2003

Assets

Cash and cash equivalents $ 3,379 $ 3,821

Marketable securities 858 686

Receivables 1,359 1,511

Inventories 822 632

Other current assets 1,813 1,213

Total current assets 8,231 7,863

Marketable securities 636 —

Property, plant, and equipment, net 1,376 1,593

Prepaid pension costs 5,358 4,659

Goodwill and other acquired intangibles, net 434 188

Other assets 928 1,608

Total assets $ 16,963 $ 15,911

Liabilities

Accounts payable $ 872 $ 1,072

Payroll and benefit-related liabilities 1,232 1,080

Debt maturing within one year 1 389

Other current liabilities 2,361 2,393

Total current liabilities 4,466 4,934

Postretirement and postemployment benefit liabilities 4,881 4,669

Pension liabilities 1,874 2,494

Long-term debt 4,837 4,439

Liability to subsidiary trust issuing preferred securities 1,152 1,152

Other liabilities 1,132 1,594

Total liabilities 18,342 19,282

Commitments and contingencies

8.00% redeemable convertible preferred stock — 868

ShareownersÂ’ Deficit

Preferred stock—par value $1.00 per share; authorized shares:

250; issued and outstanding: none — —

Common stock—par value $.01 per share;Authorized shares:

10,000; 4,396 issued and 4,395 outstanding shares as of

September 30, 2004,and 4,170 issued and 4,169

outstanding shares as of September 30, 2003 44 42

Additional paid-in capital 23,005 22,252

Accumulated deficit (20,793) (22,795)

Accumulated other comprehensive loss (3,635) (3,738)

Total shareownersÂ’ deficit (1,379) (4,239)

Total liabilities, redeemable convertible preferred stock

and shareownersÂ’ deficit $ 16,963 $ 15911

1 Answer

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  • Sandy
    Lv 7
    1 decade ago
    Favorite Answer

    I've sent the file to the address you once gave me.

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