MANGALORE CHEMICALS 2018-19 Annual Report Analysis

Sun, 31 Mar

MANGALORE CHEMICALS has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

MANGALORE CHEMICALS Income Statement Analysis

• Operating income during the year rose 14.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 23.2% YoY during the fiscal. Operating profit margins witnessed a fall and down at 6.1% in FY19 as against 5.7% in FY18.
• Depreciation charges increased by 4.8% and finance costs increased by 31.7% YoY, respectively.
• Other income declined by 72.5% YoY.
• Net profit for the year declined by 45.7% YoY.
• Net profit margins during the year declined from 2.3% in FY18 to 1.1% in FY19.

MANGALORE CHEMICALS Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	26,850	30,736	14.5%
Other income	Rs m	438	120	-72.5%
Total Revenues	Rs m	27,287	30,857	13.1%
Gross profit	Rs m	1,526	1,879	23.2%
Depreciation	Rs m	370	388	4.8%
Interest	Rs m	843	1,110	31.7%
Profit before tax	Rs m	750	501	-33.2%
Tax	Rs m	145	173	19.3%
Profit after tax	Rs m	606	329	-45.7%
Gross profit margin	%	5.7	6.1
Effective tax rate	%	19.3	34.4
Net profit margin	%	2.3	1.1

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MANGALORE CHEMICALS Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 21 billion as compared to Rs 18 billion in FY18, thereby witnessing an increase of 17.3%.
• Long-term debt stood at Rs 3 billion as compared to Rs 2 billion during FY18, a growth of 37.3%.
• Current assets rose 21% and stood at Rs 22 billion, while fixed assets rose 3% and stood at Rs 7 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 29 billion as against Rs 25 billion during FY18, thereby witnessing a growth of 16%.

MANGALORE CHEMICALS Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	4,773	4,952	3.7
Current Liabilities	Rs m	18,010	21,134	17.3
Long-term Debt	Rs m	1,969	2,703	37.3
Total Liabilities	Rs m	25,080	29,182	16.4
Current assets	Rs m	18,551	22,425	20.9
Fixed Assets	Rs m	6,529	6,757	3.5
Total Assets	Rs m	25,080	29,182	16.4

MANGALORE CHEMICALS Cash Flow Statement Analysis

• MANGALORE CHEMICALS's cash flow from operating activities (CFO) during FY19 stood at Rs -3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -589 million, an improvement of 48.9% on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs 2 billion, an improvement of 314% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs -710 million from the Rs 537 million net cash flows seen during FY18.

MANGALORE CHEMICALS Cash Flow Statement 2018-19

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-18	Mar-19
Cash Flow from Operating Activities	Rs m	329	-2,618	-
Cash Flow from Investing Activities	Rs m	-395	-589	-
Cash Flow from Financing Activities	Rs m	604	2,496	313.6%
Net Cash Flow	Rs m	537	-710	-

Current Valuations for MANGALORE CHEMICALS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.8, an decline from the EPS of Rs 5.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 41.1, stands at 14.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.0 times, while the price to sales ratio stands at 0.2 times.
• The company's price to cash flow (P/CF) ratio stood at 7.9 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Sales per share (Unadj.)	Rs	226.5	259.3
TTM Earnings per share	Rs	5.1	2.8
Diluted earnings per share	Rs	5.1	2.8
Price to Cash Flow	x	7.4	7.9
TTM P/E ratio	x	12.0	14.8
Price / Book Value ratio	x	1.8	1.1
Market Cap	Rs m	8,545	5,647
Dividends per share (Unadj.)	Rs	1.0	1.0

Ratio Analysis for MANGALORE CHEMICALS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.1x during FY19, from 1.0x during FY18. 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 1.5x during FY19, from 1.9x during FY18. 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 6.6% during FY19, from 12.7% during FY19. 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 21.1% during FY19, from 23.6% during FY18. 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 4.9% during FY19, from 5.8% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Current ratio	x	1.0	1.1
Debtors’ Days	Days	1,610	1,858
Interest coverage	x	1.9	1.5
Debt to equity ratio	x	0.4	0.5
Return on assets	%	5.8	4.9
Return on equity	%	12.7	6.6
Return on capital employed	%	23.6	21.1

To see how MANGALORE CHEMICALS has performed over the last 5 years, please visit here.

MANGALORE CHEMICALS Share Price Performance

Over the last one year, MANGALORE CHEMICALS share price has moved down from Rs 61.2 to Rs 41.1, registering a loss of Rs 20.1 or around 32.8%.

Overall, the S&P BSE SENSEX is up 16.3% over the year.

(To know more, check out historical annual results for MANGALORE CHEMICALS and quarterly results for MANGALORE CHEMICALS)

Read: Latest Annual Report Analysis of MANGALORE CHEMICALS