SHIPPING CORP 2017-18 Annual Report Analysis

Sat, 31 Mar

SHIPPING CORP 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.

SHIPPING CORP Income Statement Analysis

• Operating income during the year rose 0.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 12.7% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 19.3% in FY18 as against 22.3% in FY17.
• Depreciation charges increased by 7.8% and finance costs increased by 3.8% YoY, respectively.
• Other income declined by 4.8% YoY.
• Net profit for the year grew by 78.4% YoY.
• Net profit margins during the year grew from 4.1% in FY17 to 7.3% in FY18.

SHIPPING CORP Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	34,474	34,695	0.6%
Other income	Rs m	1,563	1,487	-4.8%
Total Revenues	Rs m	36,036	36,182	0.4%
Gross profit	Rs m	7,691	6,712	-12.7%
Depreciation	Rs m	5,661	6,103	7.8%
Interest	Rs m	1,736	1,801	3.8%
Profit before tax	Rs m	1,857	295	-84.1%
Tax	Rs m	435	-2,243	-615.8%
Profit after tax	Rs m	1,422	2,538	78.4%
Gross profit margin	%	22.3	19.3
Effective tax rate	%	23.4	-760.8
Net profit margin	%	4.1	7.3

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SHIPPING CORP Balance Sheet Analysis

• The company's current liabilities during FY18 down at Rs 38 billion as compared to Rs 41 billion in FY17, thereby witnessing an decrease of -8.1%.
• Long-term debt stood at Rs 33 billion as compared to Rs 31 billion during FY17, a growth of 7.4%.
• Current assets fell 2% and stood at Rs 27 billion, while fixed assets rose 0% and stood at Rs 118 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 145 billion as against Rs 145 billion during FY17, thereby witnessing a fall of 0%.

SHIPPING CORP Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	68,941	72,353	4.9
Current Liabilities	Rs m	41,025	37,695	-8.1
Long-term Debt	Rs m	30,776	33,066	7.4
Total Liabilities	Rs m	145,486	145,063	-0.3
Current assets	Rs m	27,357	26,901	-1.7
Fixed Assets	Rs m	118,128	118,161	0.0
Total Assets	Rs m	145,486	145,063	-0.3

SHIPPING CORP Cash Flow Statement Analysis

• SHIPPING CORP's cash flow from operating activities (CFO) during FY18 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -5 billion, an improvement of 448.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -871 million, an improvement of 83% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -3 billion from the Rs 745 million net cash flows seen during FY17.

SHIPPING CORP 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	6,825	2,284	-66.5%
Cash Flow from Investing Activities	Rs m	-858	-4,708	-
Cash Flow from Financing Activities	Rs m	-5,224	-871	-
Net Cash Flow	Rs m	745	-3,295	-

Current Valuations for SHIPPING CORP

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 5.4, an improvement from the EPS of Rs 3.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 64.4, stands at 11.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.4 times, while the price to sales ratio stands at 0.9 times.
• The company's price to cash flow (P/CF) ratio stood at 4.7 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	74.0	74.5
TTM Earnings per share	Rs	3.1	5.4
Diluted earnings per share	Rs	3.1	5.4
Price to Cash Flow	x	5.0	4.7
TTM P/E ratio	x	26.1	11.8
Price / Book Value ratio	x	0.5	0.6
Market Cap	Rs m	31,034	40,909
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for SHIPPING CORP

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.7x during FY18, from 0.7x 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 1.2x during FY18, from 2.1x 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 improved and stood at 3.5% during FY18, from 2.1% 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 3.6% 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 improved and stood at 3.0% during FY18, from 2.2% 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	0.7	0.7
Debtors’ Days	Days	697	697
Interest coverage	x	2.1	1.2
Debt to equity ratio	x	0.4	0.5
Return on assets	%	2.2	3.0
Return on equity	%	2.1	3.5
Return on capital employed	%	3.6	2.0

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

SHIPPING CORP Share Price Performance

Over the last one year, SHIPPING CORP share price has moved down from Rs 76.0 to Rs 64.4, registering a loss of Rs 11.7 or around 15.3%.

Overall, the S&P BSE SENSEX is up 12.1% over the year.

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

Read: Latest Annual Report Analysis of SHIPPING CORP