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- Aug 13, 2001 - Archies: E-card blues
Archies: E-card blues
Archies Greetings' bad patch continues. In 1QFY02 the gift and greeting cards major has reported a 38% decline in net profit to Rs 16 m. This is despite a 10% growth in topline during the period under review.
| (Rs m) | 1QFY01 | 1QFY02 | Change |
| Gross Sales | 113 | 125 | 10.3% |
| Other Income | 2 | 1 | -65.6% |
| Expenditure | 85 | 104 | 22.5% |
| Operating Profit (EBDIT) | 28 | 21 | -26.8% |
| Operating Profit Margin (%) | 24.8% | 16.4% | |
| Interest | 1 | 2 | 50.0% |
| Depreciation | 3 | 3 | 26.3% |
| Profit before Tax | 26 | 16 | -37.9% |
| Tax | 0 | 0 | - |
| Profit/(Loss) after Tax | 26 | 16 | -37.9% |
| Net profit margin (%) | 22.8% | 12.8% | |
| No. of Shares (eoy) (m) | 6.5 | 6.5 | |
| Diluted earnings per share* | 15.8 | 9.8 | |
| P/E ratio | 4.4 | ||
| * (annualised) |
In FY01, Archies had reported a 4% decline in topline and a significant 32% decline in net profit. One of the key reasons for Archies bad patch is that its turnover growth has not kept pace with expenditure, which continues to grow at a faster clip.
One of the reasons for mounting expenditure is that the company is expanding and upgrading its distribution network. During the June quarter, Archies added 8 franchisees, taking the total tally to 513 (including 27 company owned/managed outlets). The Company has also opened its branch offices at Calcutta, Noida & Chennai.
The Internet boom has also taken a toll on the company's growth. Since a lot of youngsters send cards through the net (e-cards), which are free, Archies business has suffered. Though Archies has spent a considerable amount to set up its own Internet presence, the cost free nature of the Internet means negligible returns, atleast for now. Added to this, Archies had diversified into cutting out music albums. After showing initial promise this business is now shorn of momentum.
At Rs 44 the stock trades at a P/e multiple of 4.4 times 1QFY02 annualised earnings. Though Archies has not done too well in the recent past, once its distribution upgradation and expansion plans consolidate, the company could again gain momentum as expenses stabilise. With some Internet majors already toying with the idea of charging for e-mail and other services, things may change on this front too. But these are all long term positives.
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ARCHIES LTD 2018-19 Annual Report Analysis (Annual Result Update)
Sep 30, 2019 | Updated on Sep 30, 2019Here's an analysis of the annual report of ARCHIES LTD for 2018-19. It includes a full income statement, balance sheet and cash flow analysis of ARCHIES LTD. Also includes updates on the valuation of ARCHIES LTD.
ARCHIES LTD Announces Quarterly Results (1QFY20); Net Profit Down 392.1% (Quarterly Result Update)
Aug 16, 2019 | Updated on Aug 16, 2019For the quarter ended June 2019, ARCHIES LTD has posted a net profit of Rs 23 m (down 392.1% YoY). Sales on the other hand came in at Rs 313 m (down 8.6% YoY). Read on for a complete analysis of ARCHIES LTD's quarterly results.
ARCHIES LTD Announces Quarterly Results (4QFY19); Net Profit Down 213.4% (Quarterly Result Update)
Jun 5, 2019 | Updated on Jun 5, 2019For the quarter ended March 2019, ARCHIES LTD has posted a net profit of Rs 3 m (down 213.4% YoY). Sales on the other hand came in at Rs 404 m (down 5.4% YoY). Read on for a complete analysis of ARCHIES LTD's quarterly results.
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