Research On Sustainable Operation Of Enterprises Based On Free Cash Flow

As of the end of December 2020,the number of listed companies on the Shanghai and Shenzhen Stock Exchanges exceeded 5,000.Behind the sharp increase in the number of listed companies,the number of delisted companies has also reached a new high.According to statistics,the number of delisted companies this year has broken the historical data and is compulsory.The number of delisting and restructuring delisting companies continues to increase.At the same time,2020 is also the last year of my country’s implementation of the “13th Five-Year Plan”.my country’s economy has entered a stage of “new normal”.Integrated development makes enterprises face a more intense market environment.In such an environment,whether an enterprise can continue to operate is extremely important to the majority of investors,creditors and potential stakeholders.The importance of scientifically and objectively assessing the ability of an enterprise to continue operating is self-evident.Compared with the financial statement analysis mode which only focuses on single accounting profit,it is more rigorous,objective and scientific to analyze the sustainable operation ability of enterprises from the perspective of free cash flow.Therefore,based on the perspective of free cash flow,based on the competitive advantage theory of enterprises and the accounting hypothesis of going concern,this paper studies and analyzes the sustainable operation ability of biopharmaceutical enterprises,and introduces case companies with industry characteristics to analyze the sustainable operation ability of enterprises from the perspective of free cash flow from the perspectives of financial indicators and non-financial indicators,among which financial indicators are the key points of this paper.First,The current free cash flow is calculated and analyzed through operating net profit,depreciation and amortization,increase of working capital and capital expenditure.Secondly,based on free cash flow,the free cash recovery rate,free cash ratio and net profit free cash index of the case company are calculated and analyzed.Finally,the forecast period and subsequent period are divided.The proportional forecast method is adopted as the basic assumption,and the growth rate of each index is set to calculate and analyze the future free cash flow of Zhifei Bio.Based on the study of case free cash flow,it is found that there are some problems,such as unreasonable product structure and less independent research and development.