NALCO 2018-19 Annual Report Analysis

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NALCO 2018-19 Annual Report Analysis
Mon, 9 Sep

NALCO 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.

NALCO Income Statement Analysis

  • Operating income during the year rose 20.9% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 107.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 25.2% in FY19 as against 14.7% in FY18.
  • Depreciation charges decreased by 0.9% and finance costs increased by 22.1% YoY, respectively.
  • Other income grew by 8.8% YoY.
  • Net profit for the year grew by 29.2% YoY.
  • Net profit margins during the year grew from 13.7% in FY18 to 14.7% in FY19.

NALCO Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 95,095 114,993 20.9%
Other income Rs m 2,997 3,259 8.8%
Total Revenues Rs m 98,091 118,252 20.6%
Gross profit Rs m 13,975 28,925 107.0%
Depreciation Rs m 4,804 4,761 -0.9%
Interest Rs m 20 24 22.1%
Profit before tax Rs m 12,148 27,399 125.6%
Tax Rs m 6,964 10,075 44.7%
Profit after tax Rs m 13,422 17,337 29.2%
Gross profit margin % 14.7 25.2
Effective tax rate % 57.3 36.8
Net profit margin % 13.7 14.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NALCO Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 29 billion as compared to Rs 24 billion in FY18, thereby witnessing an increase of 19.0%.
  • Current assets rose 2% and stood at Rs 56 billion, while fixed assets rose 1% and stood at Rs 82 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 151 billion as against Rs 146 billion during FY18, thereby witnessing a growth of 4%.

NALCO Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 105,040 104,849 -0.2
 
Current Liabilities Rs m 24,409 29,051 19.0
Long-term Debt Rs m 0 0 0.0
Total Liabilities Rs m 146,129 151,474 3.7
 
Current assets Rs m 55,095 56,007 1.7
Fixed Assets Rs m 80,547 81,685 1.4
Total Assets Rs m 146,129 151,474 3.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



NALCO Cash Flow Statement Analysis

  • NALCO's cash flow from operating activities (CFO) during FY19 stood at Rs 24 billion, an improvement of 51.5% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -5 billion, an improvement of 8.5% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs -17 billion on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs 1 billion from the Rs 5 million net cash flows seen during FY18.

NALCO 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 15,903 24,089 51.5%
Cash Flow from Investing Activities Rs m -4,902 -5,319 -
Cash Flow from Financing Activities Rs m -10,997 -17,308 -
Net Cash Flow Rs m 5 1,463 28,025.0%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for NALCO

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 9.3, an improvement from the EPS of Rs 6.9 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 43.9, stands at 9.9 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 1.2 times, while the price to sales ratio stands at 1.1 times.
  • The company's price to cash flow (P/CF) ratio stood at 5.1 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 49.2 61.6
TTM Earnings per share Rs 6.9 9.3
Diluted earnings per share Rs 5.2 6.7
Price to Cash Flow x 4.7 5.1
TTM P/E ratio x 7.4 9.9
Price / Book Value ratio x 1.5 1.2
Market Cap Rs m 84,856 113,141
Dividends per share (Unadj.) Rs 5.7 5.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for NALCO

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.9x during FY19, from 2.3x 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 improved and stood at 1,152.2x during FY19, from 623.9x 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 improved and stood at 16.5% during FY19, from 12.8% 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 improved and stood at 26.2% during FY19, from 19.4% 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 improved and stood at 11.5% during FY19, from 9.2% 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 2.3 1.9
Debtors’ Days Days 10 8
Interest coverage x 623.9 1,152.2
Debt to equity ratio x 0.0 0.0
Return on assets % 9.2 11.5
Return on equity % 12.8 16.5
Return on capital employed % 19.4 26.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

NALCO Share Price Performance

Over the last one year, NALCO share price has moved down from Rs 71.9 to Rs 43.9, registering a loss of Rs 28.0 or around 38.9%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 8,835.2 (up 0.9%). Over the last one year it has moved down from 14,045.5 to 8,835.2, a loss of 5,210 points (down 37.1%).

Overall, the S&P BSE SENSEX is down 2.7% over the year.

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

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NALCO Announces Quarterly Results (3QFY20); Net Profit Down 111.3% (Quarterly Result Update)

Feb 11, 2020 | Updated on Feb 11, 2020

For the quarter ended December 2019, NALCO has posted a net profit of Rs 340 m (down 111.3% YoY). Sales on the other hand came in at Rs 21 bn (down 23.2% YoY). Read on for a complete analysis of NALCO's quarterly results.

NALCO Announces Quarterly Results (1QFY20); Net Profit Down 85.8% (Quarterly Result Update)

Aug 14, 2019 | Updated on Aug 14, 2019

For the quarter ended June 2019, NALCO has posted a net profit of Rs 978 m (down 85.8% YoY). Sales on the other hand came in at Rs 21 bn (down 29.9% YoY). Read on for a complete analysis of NALCO's quarterly results.

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