PEARL GLOBAL 2017-18 Annual Report Analysis

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PEARL GLOBAL 2017-18 Annual Report Analysis
Tue, 18 Dec

PEARL GLOBAL 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.

PEARL GLOBAL Income Statement Analysis

  • Operating income during the year fell 2.7% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 60.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 1.7% in FY18 as against 4.1% in FY17.
  • Depreciation charges increased by 17.7% and finance costs increased by 5.3% YoY, respectively.
  • Other income grew by 58.1% YoY.
  • Net profit for the year declined by 45.0% YoY.
  • Net profit margins during the year declined from 2.7% in FY17 to 1.5% in FY18.

PEARL GLOBAL Income Statement 2017-18

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Net Sales Rs m 15,381 14,960 -2.7%
Other income Rs m 301 476 58.1%
Total Revenues Rs m 15,681 15,436 -1.6%
Gross profit Rs m 626 248 -60.4%
Depreciation Rs m 192 226 17.7%
Interest Rs m 242 255 5.3%
Profit before tax Rs m 492 242 -50.9%
Tax Rs m 72 93 29.1%
Profit after tax Rs m 420 231 -45.0%
Gross profit margin % 4.1 1.7
Effective tax rate % 14.7 38.6
Net profit margin % 2.7 1.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



PEARL GLOBAL Balance Sheet Analysis

  • The company's current liabilities during FY18 down at Rs 4 billion as compared to Rs 4 billion in FY17, thereby witnessing an decrease of -2.1%.
  • Long-term debt stood at Rs 490 million as compared to Rs 369 million during FY17, a growth of 32.9%.
  • Current assets fell 5% and stood at Rs 5 billion, while fixed assets fell 2% and stood at Rs 3 billion in FY18.
  • Overall, the total assets and liabilities for FY18 stood at Rs 9 billion as against Rs 9 billion during FY17, thereby witnessing a growth of 2%.

PEARL GLOBAL Balance Sheet as on March 2018

No. of Mths Year Ending 12 Mar-17* 12 Mar-18* % Change
Networth Rs m 3,805 3,951 3.8
 
Current Liabilities Rs m 4,355 4,263 -2.1
Long-term Debt Rs m 369 490 32.9
Total Liabilities Rs m 9,157 9,367 2.3
 
Current assets Rs m 5,765 5,495 -4.7
Fixed Assets Rs m 2,691 2,626 -2.4
Total Assets Rs m 9,157 9,367 2.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



PEARL GLOBAL Cash Flow Statement Analysis

  • PEARL GLOBAL's cash flow from operating activities (CFO) during FY18 stood at Rs 337 million, an improvement of 123.7% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY18 stood at Rs -585 million, an improvement of 19.6% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY18 stood at Rs 307 million, an improvement of 171% on a YoY basis.
  • Overall, net cash flows for the company during FY18 stood at Rs 59 million from the Rs -225 million net cash flows seen during FY17.

PEARL GLOBAL 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 151 337 123.7%
Cash Flow from Investing Activities Rs m -489 -585 -
Cash Flow from Financing Activities Rs m 113 307 170.8%
Net Cash Flow Rs m -225 59 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for PEARL GLOBAL

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 10.7, an decline from the EPS of Rs 19.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 138.6, stands at 11.9 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 0.7 times, while the price to sales ratio stands at 0.2 times.
  • The company's price to cash flow (P/CF) ratio stood at 6.6 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 710.1 690.7
TTM Earnings per share Rs 19.4 10.7
Diluted earnings per share Rs 19.4 10.7
Price to Cash Flow x 4.9 6.6
TTM P/E ratio x 11.9 11.9
Price / Book Value ratio x 1.0 0.7
Market Cap Rs m 3,002 3,002
Dividends per share (Unadj.) Rs 3.0 2.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for PEARL GLOBAL

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.3x during FY18, from 1.3x 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 1.9x during FY18, from 3.0x 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 5.8% during FY18, from 11.0% 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 13.0% during FY18, from 17.6% 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 5.2% during FY18, from 7.2% 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 1.3 1.3
Debtors’ Days Days 38 35
Interest coverage x 3.0 1.9
Debt to equity ratio x 0.1 0.1
Return on assets % 7.2 5.2
Return on equity % 11.0 5.8
Return on capital employed % 17.6 13.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

PEARL GLOBAL Share Price Performance

Over the last one year, PEARL GLOBAL share price has moved up from Rs 136.0 to Rs 138.6, registering a gain of Rs 2.6 or around 1.9%.

Overall, the S&P BSE SENSEX is up 7.4% over the year.

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

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