ARSS INFRASTRUCTURE 2018-19 Annual Report Analysis

Sun, 31 Mar

ARSS INFRASTRUCTURE has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

ARSS INFRASTRUCTURE Income Statement Analysis

• Operating income during the year fell 21.4% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 125.6% YoY during the fiscal. Operating profit margins witnessed a fall and down at 1.8% in FY19 as against 5.6% in FY18.
• Depreciation charges decreased by 8.0% and finance costs decreased by 28.0% YoY, respectively.
• Other income grew by 37.3% YoY.
• Net profit for the year declined by 79.5% YoY.
• Net profit margins during the year grew from 9.4% in FY18 to 2.4% in FY19.

ARSS INFRASTRUCTURE Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	5,843	4,591	-21.4%
Other income	Rs m	191	262	37.3%
Total Revenues	Rs m	6,034	4,853	-19.6%
Gross profit	Rs m	-330	85	-125.6%
Depreciation	Rs m	239	220	-8.0%
Interest	Rs m	409	294	-28.0%
Profit before tax	Rs m	-788	-168	-78.6%
Tax	Rs m	-240	-56	-76.6%
Profit after tax	Rs m	-548	-112	-79.5%
Gross profit margin	%	-5.6	1.8
Effective tax rate	%	30.5	33.4
Net profit margin	%	-9.4	-2.4

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ARSS INFRASTRUCTURE Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 19 billion as compared to Rs 12 billion in FY18, thereby witnessing an increase of 58.1%.
• Long-term debt down at Rs 48 million as compared to Rs 7 billion during FY18, a fall of 99.3%.
• Current assets rose 10% and stood at Rs 4 billion, while fixed assets fell 2% and stood at Rs 15 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 19 billion as against Rs 19 billion during FY18, thereby witnessing a growth of 0%.

ARSS INFRASTRUCTURE Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	322	204	-36.5
Current Liabilities	Rs m	11,791	18,642	58.1
Long-term Debt	Rs m	6,631	48	-99.3
Total Liabilities	Rs m	18,651	18,737	0.5
Current assets	Rs m	3,286	3,610	9.9
Fixed Assets	Rs m	15,364	15,127	-1.5
Total Assets	Rs m	18,651	18,737	0.5

ARSS INFRASTRUCTURE Cash Flow Statement Analysis

• ARSS INFRASTRUCTURE's cash flow from operating activities (CFO) during FY19 stood at Rs 7 billion, an improvement of 721.6% on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs 102 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -7 billion on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs 131 million from the Rs 481 million net cash flows seen during FY18.

ARSS INFRASTRUCTURE Cash Flow Statement 2018-19

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-18	Mar-19
Cash Flow from Operating Activities	Rs m	838	6,887	721.6%
Cash Flow from Investing Activities	Rs m	110	102	-7.1%
Cash Flow from Financing Activities	Rs m	-467	-6,858	-
Net Cash Flow	Rs m	481	131	-72.8%

Current Valuations for ARSS INFRASTRUCTURE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -4.9, an improvement from the EPS of Rs -24.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 41.1, stands at -8.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.6 times, while the price to sales ratio stands at 0.2 times.
• The company's price to cash flow (P/CF) ratio stood at 8.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Sales per share (Unadj.)	Rs	257.0	201.9
TTM Earnings per share	Rs	-24.1	-4.9
Diluted earnings per share	Rs	-24.1	-4.9
Price to Cash Flow	x	-3.2	8.0
TTM P/E ratio	x	-1.4	-8.3
Price / Book Value ratio	x	4.4	4.2
Market Cap	Rs m	1,407	865
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for ARSS INFRASTRUCTURE

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.2x during FY19, from 0.3x during FY18. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio improved and stood at 0.4x during FY19, from -0.9x during FY18. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company improved and stood at -54.9% during FY19, from -170.1% during FY19. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 50.0% during FY19, from -5.4% during FY18. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company improved and stood at 1.0% during FY19, from -0.7% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Current ratio	x	0.3	0.2
Debtors’ Days	Days	317	589
Interest coverage	x	-0.9	0.4
Debt to equity ratio	x	20.6	0.2
Return on assets	%	-0.7	1.0
Return on equity	%	-170.1	-54.9
Return on capital employed	%	-5.4	50.0

To see how ARSS INFRASTRUCTURE has performed over the last 5 years, please visit here.

ARSS INFRASTRUCTURE Share Price Performance

Over the last one year, ARSS INFRASTRUCTURE share price has moved down from Rs 43.4 to Rs 41.1, registering a loss of Rs 2.4 or around 5.4%.

Meanwhile, the S&P BSE REALTY Index is trading at Rs 2,077.1 (up 0.6%). Over the last one year it has moved down from 2,229.9 to 2,077.1, a loss of 153 points (down 6.9%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

(To know more, check out historical annual results for ARSS INFRASTRUCTURE and quarterly results for ARSS INFRASTRUCTURE)