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AKZO NOBEL 2021-22 Annual Report Analysis
Tue, 12 Jul

AKZO NOBEL 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.

AKZO NOBEL Income Statement Analysis

  • Operating income during the year rose 30.0% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 27.1% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 13.7% in FY22 as against 14.0% in FY21.
  • Depreciation charges increased by 0.5% and finance costs increased by 40.8% YoY, respectively.
  • Other income grew by 3.8% YoY.
  • Net profit for the year grew by 39.7% YoY.
  • Net profit margins during the year grew from 8.6% in FY21 to 9.2% in FY22.

AKZO NOBEL Income Statement 2021-22

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Net Sales Rs m 24,214 31,486 30.0%
Other income Rs m 239 248 3.8%
Total Revenues Rs m 24,453 31,734 29.8%
Gross profit Rs m 3,401 4,324 27.1%
Depreciation Rs m 755 759 0.5%
Interest Rs m 103 145 40.8%
Profit before tax Rs m 2,782 3,668 31.8%
Tax Rs m 706 767 8.6%
Profit after tax Rs m 2,076 2,901 39.7%
Gross profit margin % 14.0 13.7
Effective tax rate % 25.4 20.9
Net profit margin % 8.6 9.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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AKZO NOBEL Balance Sheet Analysis

  • The company's current liabilities during FY22 stood at Rs 12 billion as compared to Rs 11 billion in FY21, thereby witnessing an increase of 7.2%.
  • Current assets rose 1% and stood at Rs 18 billion, while fixed assets rose 6% and stood at Rs 24 billion in FY22.
  • Overall, the total assets and liabilities for FY22 stood at Rs 41 billion as against Rs 40 billion during FY21, thereby witnessing a growth of 3%.

AKZO NOBEL Balance Sheet as on March 2022

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Networth Rs m 12,883 12,595 -2.2
 
Current Liabilities Rs m 11,045 11,838 7.2
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 39,947 41,331 3.5
 
Current assets Rs m 17,478 17,604 0.7
Fixed Assets Rs m 22,462 23,718 5.6
Total Assets Rs m 39,947 41,331 3.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



AKZO NOBEL Cash Flow Statement Analysis

  • AKZO NOBEL'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 2 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY22 stood at Rs -3 billion on a YoY basis.
  • Overall, net cash flows for the company during FY22 stood at Rs 59 million from the Rs -1 billion net cash flows seen during FY21.

AKZO NOBEL 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 2,832 1,214 -57.1%
Cash Flow from Investing Activities Rs m -2,249 2,304 -
Cash Flow from Financing Activities Rs m -1,737 -3,459 -
Net Cash Flow Rs m -1,154 59 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for AKZO NOBEL

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 63.7, an improvement from the EPS of Rs 45.6 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,880.0, stands at 29.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 6.8 times, while the price to sales ratio stands at 2.7 times.
  • The company's price to cash flow (P/CF) ratio stood at 26.7 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 531.7 691.4
TTM Earnings per share Rs 45.6 63.7
Diluted earnings per share Rs 45.6 63.7
Price to Cash Flow x 37.1 26.7
TTM P/E ratio x 50.6 29.5
Price / Book Value ratio x 7.5 7.7
Market Cap Rs m 97,229 97,594
Dividends per share (Unadj.) Rs 50.0 75.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for AKZO NOBEL

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.5x during FY22, from 1.6x 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 deteriorated and stood at 26.3x during FY22, from 28.0x 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 improved and stood at 23.0% during FY22, from 16.1% 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 improved and stood at 30.3% during FY22, from 22.4% 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 improved and stood at 7.4% during FY22, from 5.5% 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 1.6 1.5
Debtors’ Days Days 62 57
Interest coverage x 28.0 26.3
Debt to equity ratio x 0.0 0.0
Return on assets % 5.5 7.4
Return on equity % 16.1 23.0
Return on capital employed % 22.4 30.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how AKZO NOBEL has performed over the last 5 years, please visit here.

AKZO NOBEL Share Price Performance

Over the last one year, AKZO NOBEL share price has moved down from Rs 2,282.1 to Rs 1,880.0, registering a loss of Rs 402.1 or around 17.6%.

Overall, the S&P BSE SENSEX is up 2.5% over the year.

(To know more, check out historical annual results for AKZO NOBEL and quarterly results for AKZO NOBEL)

Annual Report FAQs

What is the current share price of AKZO NOBEL?

AKZO NOBEL currently trades at Rs 2,190.7 per share. You can check out the latest share price performance of AKZO NOBEL here...

What was the revenue of AKZO NOBEL in FY22? How does it compare to earlier years?

The revenues of AKZO NOBEL stood at Rs 31,734 m in FY22, which was up 29.8% compared to Rs 24,453 m reported in FY21.

AKZO NOBEL's revenue has grown from Rs 31,277 m in FY18 to Rs 31,734 m in FY22.

Over the past 5 years, the revenue of AKZO NOBEL has grown at a CAGR of 0.4%.

What was the net profit of AKZO NOBEL in FY22? How does it compare to earlier years?

The net profit of AKZO NOBEL stood at Rs 2,901 m in FY22, which was up 39.7% compared to Rs 2,076 m reported in FY21.

This compares to a net profit of Rs 2,374 m in FY20 and a net profit of Rs 2,110 m in FY19.

Over the past 5 years, AKZO NOBEL net profit has grown at a CAGR of -7.7%.

What does the cash flow statement of AKZO NOBEL reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of AKZO NOBEL reveals:

  • Cash flow from operations decreased in FY22 and stood at Rs 1,214 m as compared to Rs 2,832 m in FY21.
  • Cash flow from investments increased in FY22 and stood at Rs 2,304 m as compared to Rs -2,249 m in FY21.
  • Cash flow from financial activity decreased in FY22 and stood at Rs -3,459 m as compared to Rs -1,737 m in FY21.

Here's the cash flow statement of AKZO NOBEL for the past 5 years.

(Rs m)FY18FY19FY20FY21FY22
From Operations1,8261,3923,7412,8321,214
From Investments-561,85244-2,2492,304
From Financial Activity-1,256-3,600-1,573-1,737-3,459
Net Cashflow514-3562,212-1,15459

What does the Key Ratio analysis of AKZO NOBEL reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of AKZO NOBEL reveals:

  • Operating profit margins witnessed a fall and stood at 13.7% in FY22 as against 14.0% in FY21.
  • Net profit margins grew from 8.6% in FY21 to 9.2% in FY22.
  • Debt to Equity ratio for FY22 stood at 0.0 as compared to 0.0 in FY21.

Here's the ratio/financial analysis of AKZO NOBEL for the past 5 years.

 FY18FY19FY20FY21FY22
Operating Profit Margin (%)10.811.714.014.013.7
Net Profit Margin (%)13.87.28.98.69.2
Debt to Equity Ratio (x)0.00.00.00.00.0

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