FINOLEX INDUSTRIES 2017-18 Annual Report Analysis

Sat, 31 Mar

FINOLEX INDUSTRIES has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

FINOLEX INDUSTRIES Income Statement Analysis

• Operating income during the year rose 19.3% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 14.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 18.3% in FY18 as against 25.4% in FY17.
• Depreciation charges increased by 10.1% and finance costs decreased by 36.2% YoY, respectively.
• Other income grew by 5.3% YoY.
• Net profit for the year declined by 16.1% YoY.
• Net profit margins during the year declined from 15.6% in FY17 to 11.0% in FY18.

FINOLEX INDUSTRIES Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	22,171	26,442	19.3%
Other income	Rs m	232	244	5.3%
Total Revenues	Rs m	22,403	26,686	19.1%
Gross profit	Rs m	5,631	4,839	-14.1%
Depreciation	Rs m	550	606	10.1%
Interest	Rs m	154	98	-36.2%
Profit before tax	Rs m	5,158	4,379	-15.1%
Tax	Rs m	1,703	1,479	-13.1%
Profit after tax	Rs m	3,455	2,900	-16.1%
Gross profit margin	%	25.4	18.3
Effective tax rate	%	33.0	33.8
Net profit margin	%	15.6	11.0

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FINOLEX INDUSTRIES Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 5 billion as compared to Rs 5 billion in FY17, thereby witnessing an increase of 6.9%.
• Current assets rose 12% and stood at Rs 8 billion, while fixed assets rose 18% and stood at Rs 27 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 35 billion as against Rs 30 billion during FY17, thereby witnessing a growth of 17%.

FINOLEX INDUSTRIES Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	23,148	27,951	20.8
Current Liabilities	Rs m	4,595	4,911	6.9
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	29,967	35,060	17.0
Current assets	Rs m	7,293	8,200	12.4
Fixed Assets	Rs m	22,674	26,860	18.5
Total Assets	Rs m	29,967	35,060	17.0

FINOLEX INDUSTRIES Cash Flow Statement Analysis

• FINOLEX INDUSTRIES's cash flow from operating activities (CFO) during FY18 stood at Rs 3 billion, an improvement of 34.4% on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -2 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -2 billion, an improvement of 38% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 13 million from the Rs 39 million net cash flows seen during FY17.

FINOLEX INDUSTRIES Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	2,517	3,384	34.4%
Cash Flow from Investing Activities	Rs m	346	-1,619	-
Cash Flow from Financing Activities	Rs m	-2,824	-1,752	-
Net Cash Flow	Rs m	39	13	-66.4%

Current Valuations for FINOLEX INDUSTRIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 23.4, an decline from the EPS of Rs 27.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 651.3, stands at 135.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 14.5 times, while the price to sales ratio stands at 3.1 times.
• The company's price to cash flow (P/CF) ratio stood at 22.7 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	178.7	213.1
TTM Earnings per share	Rs	27.8	23.4
Diluted earnings per share	Rs	5.6	4.7
Price to Cash Flow	x	89.4	22.7
TTM P/E ratio	x	104.0	135.4
Price / Book Value ratio	x	2.5	2.8
Market Cap	Rs m	57,984	79,595
Dividends per share (Unadj.)	Rs	2.3	2.0

Ratio Analysis for FINOLEX INDUSTRIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.7x during FY18, from 1.6x during FY17. 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 45.6x during FY18, from 34.5x during FY17. 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 10.4% during FY18, from 14.9% during FY18. 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 16.0% during FY18, from 22.9% during FY17. 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 declined and down at 8.6% during FY18, from 12.0% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	1.6	1.7
Debtors’ Days	Days	86	60
Interest coverage	x	34.5	45.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	12.0	8.6
Return on equity	%	14.9	10.4
Return on capital employed	%	22.9	16.0

To see how FINOLEX INDUSTRIES has performed over the last 5 years, please visit here.

FINOLEX INDUSTRIES Share Price Performance

Over the last one year, FINOLEX INDUSTRIES share price has moved up from Rs 577.5 to Rs 651.3, registering a gain of Rs 73.9 or around 12.8%.

Overall, the S&P BSE SENSEX is up 12.1% over the year.

(To know more, check out historical annual results for FINOLEX INDUSTRIES and quarterly results for FINOLEX INDUSTRIES)

Read: Latest Annual Report Analysis of FINOLEX INDUSTRIES