LIBERTY SHOE 2022-23 Annual Report Analysis

Thu, 5 Oct

LIBERTY SHOE has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

LIBERTY SHOE Income Statement Analysis

• Operating income during the year rose 34.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 43.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 9.1% in FY23 as against 8.6% in FY22.
• Depreciation charges increased by 9.1% and finance costs decreased by 1.1% YoY, respectively.
• Other income declined by 49.0% YoY.
• Net profit for the year grew by 475.6% YoY.
• Net profit margins during the year grew from 0.5% in FY22 to 2.0% in FY23.

LIBERTY SHOE Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	4,878	6,543	34.1%
Other income	Rs m	35	18	-49.0%
Total Revenues	Rs m	4,913	6,561	33.5%
Gross profit	Rs m	418	599	43.3%
Depreciation	Rs m	290	317	9.1%
Interest	Rs m	122	121	-1.1%
Profit before tax	Rs m	40	179	348.6%
Tax	Rs m	17	49	184.6%
Profit after tax	Rs m	22	129	475.6%
Gross profit margin	%	8.6	9.1
Effective tax rate	%	43.6	27.7
Net profit margin	%	0.5	2.0

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LIBERTY SHOE Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 2 billion as compared to Rs 2 billion in FY22, thereby witnessing an increase of 12.7%.
• Long-term debt down at Rs 74 million as compared to Rs 98 million during FY22, a fall of 24.4%.
• Current assets rose 5% and stood at Rs 3 billion, while fixed assets rose 17% and stood at Rs 2 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 5 billion as against Rs 4 billion during FY22, thereby witnessing a growth of 9%.

LIBERTY SHOE Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	1,890	1,982	4.8
Current Liabilities	Rs m	1,526	1,719	12.7
Long-term Debt	Rs m	98	74	-24.4
Total Liabilities	Rs m	4,318	4,707	9.0
Current assets	Rs m	2,880	3,030	5.2
Fixed Assets	Rs m	1,438	1,677	16.6
Total Assets	Rs m	4,318	4,707	9.0

LIBERTY SHOE Cash Flow Statement Analysis

• LIBERTY SHOE's cash flow from operating activities (CFO) during FY23 stood at Rs 940 million, an improvement of 148.1% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -557 million, an improvement of 539.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -387 million on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 3 million from the Rs -7 million net cash flows seen during FY22.

LIBERTY SHOE Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	379	940	148.1%
Cash Flow from Investing Activities	Rs m	-87	-557	-
Cash Flow from Financing Activities	Rs m	-304	-387	-
Net Cash Flow	Rs m	-7	3	-

Current Valuations for LIBERTY SHOE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 7.6, an improvement from the EPS of Rs 1.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 285.0, stands at 45.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.5 times, while the price to sales ratio stands at 0.7 times.
• The company's price to cash flow (P/CF) ratio stood at 10.9 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	286.3	384.0
TTM Earnings per share	Rs	1.3	7.6
Diluted earnings per share	Rs	1.3	7.6
Price to Cash Flow	x	8.0	10.9
TTM P/E ratio	x	111.3	45.0
Price / Book Value ratio	x	1.5	2.5
Market Cap	Rs m	2,829	4,858
Dividends per share (Unadj.)	Rs	0.0	2.5

Ratio Analysis for LIBERTY SHOE

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.8x during FY23, from 1.9x during FY22. 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 2.5x during FY23, from 1.3x during FY22. 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 6.5% during FY23, from 1.2% during FY23. 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 14.6% during FY23, from 8.1% during FY22. 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 5.3% during FY23, from 3.3% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	1.9	1.8
Debtors’ Days	Days	719	488
Interest coverage	x	1.3	2.5
Debt to equity ratio	x	0.1	0.0
Return on assets	%	3.3	5.3
Return on equity	%	1.2	6.5
Return on capital employed	%	8.1	14.6

To see how LIBERTY SHOE has performed over the last 5 years, please visit here.

LIBERTY SHOE Share Price Performance

Over the last one year, LIBERTY SHOE share price has moved down from Rs 336.8 to Rs 285.0, registering a loss of Rs 51.8 or around 15.4%.

Overall, the S&P BSE SENSEX is up 15.6% over the year.

(To know more, check out historical annual results for LIBERTY SHOE and quarterly results for LIBERTY SHOE)