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EVEREADY IND. 2018-19 Annual Report Analysis

Mon, 30 Sep

EVEREADY IND. 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.

EVEREADY IND. Income Statement Analysis

• Operating income during the year rose 3.5% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 3.2% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 6.7% in FY19 as against 7.2% in FY18.
• Depreciation charges increased by 13.5% and finance costs increased by 86.9% YoY, respectively.
• Other income grew by 79.0% YoY.
• Net profit for the year declined by 10.0% YoY.
• Net profit margins during the year declined from 3.6% in FY18 to 3.1% in FY19.

EVEREADY IND. Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	14,564	15,066	3.5%
Other income	Rs m	197	353	79.0%
Total Revenues	Rs m	14,761	15,420	4.5%
Gross profit	Rs m	1,044	1,011	-3.2%
Depreciation	Rs m	192	218	13.5%
Interest	Rs m	293	548	86.9%
Profit before tax	Rs m	756	598	-20.9%
Tax	Rs m	224	120	-46.7%
Profit after tax	Rs m	532	478	-10.0%
Gross profit margin	%	7.2	6.7
Effective tax rate	%	29.7	20.0
Net profit margin	%	3.6	3.1

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EVEREADY IND. Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 6 billion as compared to Rs 6 billion in FY18, thereby witnessing an increase of 3.9%.
• Long-term debt stood at Rs 2 billion as compared to Rs 855 million during FY18, a growth of 145.7%.
• Current assets rose 20% and stood at Rs 7 billion, while fixed assets fell 4% and stood at Rs 3 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 12 billion as against Rs 10 billion during FY18, thereby witnessing a growth of 17%.

EVEREADY IND. Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	3,427	3,759	9.7
Current Liabilities	Rs m	5,840	6,069	3.9
Long-term Debt	Rs m	855	2,100	145.7
Total Liabilities	Rs m	10,287	12,073	17.4
Current assets	Rs m	6,245	7,495	20.0
Fixed Assets	Rs m	3,603	3,474	-3.6
Total Assets	Rs m	10,287	12,073	17.4

EVEREADY IND. Cash Flow Statement Analysis

• EVEREADY IND.'s cash flow from operating activities (CFO) during FY19 stood at Rs 701 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -1 billion, an improvement of 44.9% on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs 2 billion, an improvement of 524% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs 823 million from the Rs -560 million net cash flows seen during FY18.

EVEREADY IND. 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	808	701	-13.3%
Cash Flow from Investing Activities	Rs m	-998	-1,446	-
Cash Flow from Financing Activities	Rs m	-370	1,567	-
Net Cash Flow	Rs m	-560	823	-

Current Valuations for EVEREADY IND.

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 6.6, an decline from the EPS of Rs 7.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 45.2, stands at 9.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.5 times, while the price to sales ratio stands at 1.4 times.
• The company's price to cash flow (P/CF) ratio stood at 4.7 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	200.4	207.3
TTM Earnings per share	Rs	7.3	6.6
Diluted earnings per share	Rs	7.3	6.6
Price to Cash Flow	x	4.5	4.7
TTM P/E ratio	x	9.2	9.2
Price / Book Value ratio	x	7.7	5.5
Market Cap	Rs m	3,286	3,285
Dividends per share (Unadj.)	Rs	1.5	0.0

Ratio Analysis for EVEREADY IND.

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.2x during FY19, from 1.1x 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 deteriorated and stood at 2.1x during FY19, from 3.6x 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 declined and down at 12.7% during FY19, from 15.5% 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 declined and down at 19.6% during FY19, from 24.5% 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 8.5% during FY19, from 8.0% 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	1.1	1.2
Debtors’ Days	Days	30	33
Interest coverage	x	3.6	2.1
Debt to equity ratio	x	0.2	0.6
Return on assets	%	8.0	8.5
Return on equity	%	15.5	12.7
Return on capital employed	%	24.5	19.6

To see how EVEREADY IND. has performed over the last 5 years, please visit here.

EVEREADY IND. Share Price Performance

Over the last one year, EVEREADY IND. share price has moved down from Rs 197.4 to Rs 45.2, registering a loss of Rs 152.2 or around 77.1%.

Meanwhile, the S&P BSE CONSUMER DURABLES Index is trading at Rs 26,011.3 (down 0.5%). Over the last one year it has moved up from 19,134.3 to 26,011.3, a gain of 6,877 points (up 35.9%).

Overall, the S&P BSE SENSEX is up 6.0% over the year.

(To know more, check out historical annual results for EVEREADY IND. and quarterly results for EVEREADY IND.)