FORBES & CO.. 2022-23 Annual Report Analysis

Tue, 15 Aug

FORBES & CO.. has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

FORBES & CO.. Income Statement Analysis

• Operating income during the year fell 14.1% on a year-on-year (YoY) basis.
• The company's operating profit was by NA YoY during the fiscal. Operating profit margins witnessed a growth and down at 1.0% in FY23 as against 55.8% in FY22.
• Depreciation charges decreased by 34.4% and finance costs decreased by 58.1% YoY, respectively.
• Other income grew by 628.5% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year grew from 62.9% in FY22 to 43.3% in FY23.

FORBES & CO.. Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	5,147	4,420	-14.1%
Other income	Rs m	368	2,684	628.5%
Total Revenues	Rs m	5,516	7,104	28.8%
Gross profit	Rs m	-2,873	-45	NA
Depreciation	Rs m	414	272	-34.4%
Interest	Rs m	420	176	-58.1%
Profit before tax	Rs m	-3,339	2,191	NA
Tax	Rs m	-103	278	NA
Profit after tax	Rs m	-3,236	1,913	NA
Gross profit margin	%	-55.8	-1.0
Effective tax rate	%	3.1	12.7
Net profit margin	%	-62.9	43.3

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FORBES & CO.. Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 4 billion as compared to Rs 6 billion in FY22, thereby witnessing an decrease of -27.5%.
• Long-term debt stood at Rs 806 million as compared to Rs 635 million during FY22, a growth of 26.9%.
• Current assets rose 11% and stood at Rs 4 billion, while fixed assets fell 3% and stood at Rs 3 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 7 billion as against Rs 8 billion during FY22, thereby witnessing a fall of 10%.

FORBES & CO.. Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	864	1,631	88.7
Current Liabilities	Rs m	5,652	4,096	-27.5
Long-term Debt	Rs m	635	806	26.9
Total Liabilities	Rs m	7,595	6,825	-10.1
Current assets	Rs m	3,412	3,786	11.0
Fixed Assets	Rs m	3,134	3,038	-3.1
Total Assets	Rs m	7,595	6,825	-10.1

FORBES & CO.. Cash Flow Statement Analysis

• FORBES & CO..'s cash flow from operating activities (CFO) during FY23 stood at Rs 546 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs 2 billion, an improvement of 572.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion, an improvement of 12% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 274 million from the Rs -654 million net cash flows seen during FY22.

FORBES & CO.. Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	2,007	546	-72.8%
Cash Flow from Investing Activities	Rs m	321	2,159	572.4%
Cash Flow from Financing Activities	Rs m	-2,751	-2,428	-
Net Cash Flow	Rs m	-654	274	-

Current Valuations for FORBES & CO..

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 148.3, an improvement from the EPS of Rs -250.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 677.5, stands at 14.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.4 times, while the price to sales ratio stands at 2.0 times.
• The company's price to cash flow (P/CF) ratio stood at 3.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	399.0	342.6
TTM Earnings per share	Rs	-250.9	148.3
Diluted earnings per share	Rs	-250.9	148.3
Price to Cash Flow	x	-1.9	3.8
TTM P/E ratio	x	-1.6	14.4
Price / Book Value ratio	x	53.3	5.1
Market Cap	Rs m	46,112	8,349
Dividends per share (Unadj.)	Rs	0.0	65.0

Ratio Analysis for FORBES & CO..

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.9x during FY23, from 0.6x during FY22. 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 13.5x during FY23, from -7.0x during FY22. 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 117.3% during FY23, from -374.4% during FY23. 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 97.1% during FY23, from -194.7% during FY22. 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 30.6% during FY23, from -37.1% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	0.6	0.9
Debtors’ Days	Days	617	480
Interest coverage	x	-7.0	13.5
Debt to equity ratio	x	0.7	0.5
Return on assets	%	-37.1	30.6
Return on equity	%	-374.4	117.3
Return on capital employed	%	-194.7	97.1

To see how FORBES & CO.. has performed over the last 5 years, please visit here.

FORBES & CO.. Share Price Performance

Over the last one year, FORBES & CO.. share price has moved up from Rs 516.8 to Rs 677.5, registering a gain of Rs 160.8 or around 31.1%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 43,332.6 (down 0.2%). Over the last one year it has moved up from 30,944.1 to 43,332.6, a gain of 12,389 points (up 40.0%).

Overall, the S&P BSE SENSEX is up 10.2% over the year.

(To know more, check out historical annual results for FORBES & CO.. and quarterly results for FORBES & CO..)