GSK PHARMA 2021-22 Annual Report Analysis

Sat, 25 Jun

GSK PHARMA has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

GSK PHARMA Income Statement Analysis

• Operating income during the year rose 0.6% on a year-on-year (YoY) basis.
• The company's operating profit increased by 46.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.9% in FY22 as against 16.3% in FY21.
• Depreciation charges decreased by 14.0% and finance costs decreased by 43.6% YoY, respectively.
• Other income declined by 31.1% YoY.
• Net profit for the year grew by 5.1% YoY.
• Net profit margins during the year grew from 11.2% in FY21 to 11.7% in FY22.

GSK PHARMA Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	31,989	32,175	0.6%
Other income	Rs m	1,106	762	-31.1%
Total Revenues	Rs m	33,094	32,937	-0.5%
Gross profit	Rs m	5,227	7,674	46.8%
Depreciation	Rs m	793	682	-14.0%
Interest	Rs m	35	20	-43.6%
Profit before tax	Rs m	5,505	7,734	40.5%
Tax	Rs m	1,924	3,969	106.3%
Profit after tax	Rs m	3,581	3,766	5.1%
Gross profit margin	%	16.3	23.9
Effective tax rate	%	34.9	51.3
Net profit margin	%	11.2	11.7

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GSK PHARMA Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 17 billion as compared to Rs 13 billion in FY21, thereby witnessing an increase of 25.7%.
• Current assets rose 67% and stood at Rs 37 billion, while fixed assets rose 4% and stood at Rs 8 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 45 billion as against Rs 30 billion during FY21, thereby witnessing a growth of 50%.

GSK PHARMA Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	14,991	26,776	78.6
Current Liabilities	Rs m	13,325	16,744	25.7
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	30,102	45,098	49.8
Current assets	Rs m	22,027	36,707	66.6
Fixed Assets	Rs m	8,076	8,391	3.9
Total Assets	Rs m	30,102	45,098	49.8

GSK PHARMA Cash Flow Statement Analysis

• GSK PHARMA's cash flow from operating activities (CFO) during FY22 stood at Rs 8 billion, an improvement of 41.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -4 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -5 billion, an improvement of 25% on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs -1 billion from the Rs 3 billion net cash flows seen during FY21.

GSK PHARMA Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	5,779	8,198	41.9%
Cash Flow from Investing Activities	Rs m	4,186	-4,197	-
Cash Flow from Financing Activities	Rs m	-6,961	-5,242	-
Net Cash Flow	Rs m	3,004	-1,241	-

Current Valuations for GSK PHARMA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 22.2, an improvement from the EPS of Rs 21.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,499.8, stands at 62.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 9.5 times, while the price to sales ratio stands at 7.9 times.
• The company's price to cash flow (P/CF) ratio stood at 63.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	188.8	189.9
TTM Earnings per share	Rs	21.1	22.2
Diluted earnings per share	Rs	21.1	22.2
Price to Cash Flow	x	55.8	63.2
TTM P/E ratio	x	73.9	62.1
Price / Book Value ratio	x	16.7	10.5
Market Cap	Rs m	250,695	280,960
Dividends per share (Unadj.)	Rs	30.0	90.0

Ratio Analysis for GSK PHARMA

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.2x during FY22, from 1.7x during FY21. 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 389.7x during FY22, from 156.9x during FY21. 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 14.1% during FY22, from 23.9% during FY22. 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 29.0% during FY22, from 37.0% during FY21. 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 8.4% during FY22, from 12.0% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	1.7	2.2
Debtors’ Days	Days	246	233
Interest coverage	x	156.9	389.7
Debt to equity ratio	x	0.0	0.0
Return on assets	%	12.0	8.4
Return on equity	%	23.9	14.1
Return on capital employed	%	37.0	29.0

To see how GSK PHARMA has performed over the last 5 years, please visit here.

GSK PHARMA Share Price Performance

Over the last one year, GSK PHARMA share price has moved down from Rs 1,515.2 to Rs 1,499.8, registering a loss of Rs 15.5 or around 1.0%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 21,666.4 (up 0.6%). Over the last one year it has moved down from 25,099.5 to 21,666.4, a loss of 3,433 points (down 13.7%).

Overall, the S&P BSE SENSEX is up 0.8% over the year.

(To know more, check out historical annual results for GSK PHARMA and quarterly results for GSK PHARMA)

Read: Latest Annual Report Analysis of GSK PHARMA