Hewelett Packard Company & Subsidiaries

Hewelett Ð'- Packard Company & Subsidiaries

TABLE OF CONTENTS

Section I

Introduction

Company ProfileÐ'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'..... 5

Board MembersÐ'...Ð'.....Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 8

History Ð'...Ð'...Ð'...Ð'...Ð'... Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 9

Section II

Strategic Analysis

Industry ChallengesÐ'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 11

Lines of Business Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 13

Sales, Marketing & DistributionÐ'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 13

SWOT Analysis..Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 13

Competition..Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 13

Section III

Core Analysis

Short Term AnalysisÐ'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 15

Long Term LiquidityÐ'...Ð'.....Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'.... 18

Profitability Analysis..Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 21

Asset EfficiencyÐ'...Ð'.....Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 21

Cash Flow AnalysisÐ'.....Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'... 21

Section IV

Summary & ConclusionÐ'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'.... 26

Section V

Appendix: Financial StatementsÐ'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'...Ð'.....Ð'.... 28

Section I: Introduction

HP Profile:

HP is a leading global provider of products, technologies, solutions and services to individual consumers and businesses. HP offerings span information technology (Ð''Ð''IT'') infrastructure and storage, personal computing and other access devices, multi-vendor services including maintenance, consulting and integration and outsourcing, and imaging and printing. HP products and services are available worldwide.

HP is a company unlike any other. They serve everyone from consumers to small and mid-sized businesses to enterprises to public sector customers with an extensive portfolio of market-leading solutions specifically designed to meet the needs of each customer segment.

HP annual R&D investment of $3.5 billion (USD) fuels the invention of products, solutions and new technologies. HP produces an average of 11 patents a day worldwide. HP Labs provides a central research function for the company, which is focused on inventing new technologies to improve their customers' lives, change markets and create business opportunities.

Millions of people around the world use HP technology every day due to the fact that HP is:

Ð'* The largest consumer IT company

Ð'* The world's largest SMB IT company

Ð'* A leading enterprise IT company

HP's strategy is to offer products, services and solutions that are high tech, low cost and deliver the best customer experience. HP's team of 151,000 employees does business in more than 170 countries. Revenue reached $86.7 billion for the fiscal year that ended October 31, 2005.

HP Rankings

#1 globally in the inkjet, all-in-one and single-function printers, mono and color laser printers, large format printing, scanners, print servers and ink and laser supplies*

Ð'* #1 globally in x86*, WindowsÐ'®*, LinuxÐ'®*, UNIX* and blade servers**

Ð'* #1 in total disk and storage systems*

Ð'* #2 globally in notebook PCs*

Ð'* #1 globally in Pocket PCs*

Ð'* #1 in customer support**

Ð'* #1 position in customer loyalty for Pro-Liant servers***

* Refers to units, except storage referred in factory revenue. Source: IDC Q3 2004

** Source: Gartner, November 2004

*** Source: Technology Business Research, Inc., October 26, 2004

Ð'®Windows is a U.S. registered trademark of Microsoft Corp.

Linux is a U.S. registered trademark of Linus Torvalds.

HP Board members:

Lawrence T. Babbio, Jr.

(Director since 2002)

Mr. Babbio has served since 2000 as vice chairman and president of Verizon Communications, Inc. (formerly Bell Atlantic Corporation). Mr. Babbio was a director of Compaq from 1995 until its merger with HP in May 2002. Mr. Babbio is also a director of ARAMARK Corporation. In 1997,