HERITAGE FOOD 2021-22 Annual Report Analysis

Mon, 4 Jul

HERITAGE FOOD 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.

HERITAGE FOOD Income Statement Analysis

• Operating income during the year rose 8.4% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 30.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 6.8% in FY22 as against 10.7% in FY21.
• Depreciation charges increased by 12.9% and finance costs decreased by 72.7% YoY, respectively.
• Other income grew by 40.3% YoY.
• Net profit for the year declined by 32.2% YoY.
• Net profit margins during the year declined from 6.1% in FY21 to 3.8% in FY22.

HERITAGE FOOD Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	24,731	26,813	8.4%
Other income	Rs m	80	113	40.3%
Total Revenues	Rs m	24,811	26,926	8.5%
Gross profit	Rs m	2,635	1,833	-30.4%
Depreciation	Rs m	462	522	12.9%
Interest	Rs m	206	56	-72.7%
Profit before tax	Rs m	2,047	1,368	-33.2%
Tax	Rs m	535	342	-36.0%
Profit after tax	Rs m	1,513	1,026	-32.2%
Gross profit margin	%	10.7	6.8
Effective tax rate	%	26.1	25.0
Net profit margin	%	6.1	3.8

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HERITAGE FOOD Balance Sheet Analysis

• The company's current liabilities during FY22 down at Rs 2 billion as compared to Rs 2 billion in FY21, thereby witnessing an decrease of -12.2%.
• Long-term debt down at Rs 80 million as compared to Rs 340 million during FY21, a fall of 76.6%.
• Current assets rose 12% and stood at Rs 3 billion, while fixed assets fell 1% and stood at Rs 6 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 9 billion as against Rs 9 billion during FY21, thereby witnessing a growth of 3%.

HERITAGE FOOD Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	5,926	6,544	10.4
Current Liabilities	Rs m	2,079	1,826	-12.2
Long-term Debt	Rs m	340	80	-76.6
Total Liabilities	Rs m	8,785	9,026	2.7
Current assets	Rs m	2,595	2,908	12.1
Fixed Assets	Rs m	6,191	6,118	-1.2
Total Assets	Rs m	8,785	9,026	2.7

HERITAGE FOOD Cash Flow Statement Analysis

• HERITAGE FOOD's cash flow from operating activities (CFO) during FY22 stood at Rs 1 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -424 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs -927 million, an improvement of 52% on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 128 million from the Rs 514 million net cash flows seen during FY21.

HERITAGE FOOD 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	1,739	1,479	-15.0%
Cash Flow from Investing Activities	Rs m	688	-424	-
Cash Flow from Financing Activities	Rs m	-1,913	-927	-
Net Cash Flow	Rs m	514	128	-75.1%

Current Valuations for HERITAGE FOOD

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 22.1, an decline from the EPS of Rs 32.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 265.5, stands at 12.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 0.5 times.
• The company's price to cash flow (P/CF) ratio stood at 12.8 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	533.0	577.9
TTM Earnings per share	Rs	32.6	22.1
Diluted earnings per share	Rs	32.6	22.1
Price to Cash Flow	x	6.9	12.8
TTM P/E ratio	x	9.0	12.0
Price / Book Value ratio	x	2.3	3.0
Market Cap	Rs m	13,673	19,782
Dividends per share (Unadj.)	Rs	5.0	5.0

Ratio Analysis for HERITAGE FOOD

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.6x during FY22, from 1.2x 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 25.3x during FY22, from 10.9x 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 15.7% during FY22, from 25.5% 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 21.5% during FY22, from 36.0% 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 12.0% during FY22, from 19.6% 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	1.2	1.6
Debtors’ Days	Days	2	3
Interest coverage	x	10.9	25.3
Debt to equity ratio	x	0.1	0.0
Return on assets	%	19.6	12.0
Return on equity	%	25.5	15.7
Return on capital employed	%	36.0	21.5

To see how HERITAGE FOOD has performed over the last 5 years, please visit here.

HERITAGE FOOD Share Price Performance

Over the last one year, HERITAGE FOOD share price has moved down from Rs 474.1 to Rs 265.5, registering a loss of Rs 208.6 or around 44.0%.

Overall, the S&P BSE SENSEX is up 0.9% over the year.

(To know more, check out historical annual results for HERITAGE FOOD and quarterly results for HERITAGE FOOD)

Read: Latest Annual Report Analysis of HERITAGE FOOD