VODAFONE IDEA 2017-18 Annual Report Analysis

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VODAFONE IDEA 2017-18 Annual Report Analysis
Fri, 28 Dec

VODAFONE IDEA 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.

VODAFONE IDEA Income Statement Analysis

  • Operating income during the year fell 20.5% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 40.8% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 21.4% in FY18 as against 28.7% in FY17.
  • Depreciation charges increased by 7.4% and finance costs increased by 20.9% YoY, respectively.
  • Other income grew by 15.0% YoY.
  • Net profit for the year grew by 942.8% YoY.
  • Net profit margins during the year declined from 1.1% in FY17 to 14.6% in FY18.

VODAFONE IDEA Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 355,757 282,789 -20.5%
Other income Rs m 3,069 3,529 15.0%
Total Revenues Rs m 358,827 286,319 -20.2%
Gross profit Rs m 102,146 60,476 -40.8%
Depreciation Rs m 78,272 84,091 7.4%
Interest Rs m 39,794 48,130 20.9%
Profit before tax Rs m -12,851 -68,216 430.8%
Tax Rs m -4,635 -23,311 402.9%
Profit after tax Rs m -3,997 -41,682 942.8%
Gross profit margin % 28.7 21.4
Effective tax rate % 36.1 34.2
Net profit margin % -1.1 -14.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



VODAFONE IDEA Balance Sheet Analysis

  • The company's current liabilities during FY18 down at Rs 106 billion as compared to Rs 171 billion in FY17, thereby witnessing an decrease of -37.7%.
  • Long-term debt stood at Rs 569 billion as compared to Rs 516 billion during FY17, a growth of 10.3%.
  • Current assets rose 20% and stood at Rs 92 billion, while fixed assets rose 4% and stood at Rs 251 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 986 billion as against Rs 967 billion during FY17, thereby witnessing a growth of 2%.

VODAFONE IDEA Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 247,322 272,625 10.2
 
Current Liabilities Rs m 170,615 106,337 -37.7
Long-term Debt Rs m 516,378 569,408 10.3
Total Liabilities Rs m 967,047 985,772 1.9
 
Current assets Rs m 76,309 91,837 20.3
Fixed Assets Rs m 241,746 251,062 3.9
Total Assets Rs m 967,047 985,772 1.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



VODAFONE IDEA Cash Flow Statement Analysis

  • VODAFONE IDEA's cash flow from operating activities (CFO) during FY18 stood at Rs 53 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -93 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs 39 billion on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs -144 million from the Rs -6 billion net cash flows seen during FY17.

VODAFONE IDEA 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 104,757 53,324 -49.1%
Cash Flow from Investing Activities Rs m -155,557 -92,717 -
Cash Flow from Financing Activities Rs m 45,061 39,249 -12.9%
Net Cash Flow Rs m -5,739 -144 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for VODAFONE IDEA

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs -9.6, an decline from the EPS of Rs -1.1 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 37.6, stands at -5.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.5 times, while the price to sales ratio stands at 1.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 3.5 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 98.7 64.9
TTM Earnings per share Rs -1.1 -9.6
Diluted earnings per share Rs -1.1 -11.6
Price to Cash Flow x 1.9 3.5
TTM P/E ratio x -5.4 -5.4
Price / Book Value ratio x 1.4 1.5
Market Cap Rs m 135,560 135,399
Dividends per share (Unadj.) Rs 0.0 0.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for VODAFONE IDEA

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 0.9x during FY18, from 0.4x 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 deteriorated and stood at -0.4x during FY18, from 0.7x 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 -15.3% during FY18, from -1.6% 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 -2.0% during FY18, from 4.1% 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 0.7% during FY18, from 3.7% 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 0.4 0.9
Debtors’ Days Days 13 11
Interest coverage x 0.7 -0.4
Debt to equity ratio x 2.1 2.1
Return on assets % 3.7 0.7
Return on equity % -1.6 -15.3
Return on capital employed % 4.1 -2.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how VODAFONE IDEA has performed over the last 5 years, please visit here.

VODAFONE IDEA Share Price Performance

Over the last one year, VODAFONE IDEA share price has moved up from Rs 102.2 to Rs 37.6, registering a loss of Rs 64.6 or around 63.2%.

Meanwhile, the S&P BSE TECK Index is trading at Rs 7,086.6 (up 0.6%). Over the last one year it has moved up from 6,329.5 to 7,086.6, a gain of 757 points (up 12.0%).

Overall, the S&P BSE SENSEX is up 6.5% over the year.

(To know more, check out historical annual results for VODAFONE IDEA and quarterly results for VODAFONE IDEA)

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