SIEMENS 2019-20 Annual Report Analysis

Wed, 30 Sep

SIEMENS has announced its results for the year ended September 2020. Let us have a look at the detailed performance review of the company during FY19-20.

SIEMENS Income Statement Analysis

• Operating income during the year fell 22.9% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 26.6% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 9.9% in FY as against 10.4% in FY.
• Depreciation charges increased by 24.9% and finance costs increased by 54.5% YoY, respectively.
• Other income declined by 34.6% YoY.
• Net profit for the year declined by 30.1% YoY.
• Net profit margins during the year declined from 8.0% in FY to 7.2% in FY.

SIEMENS Income Statement 2019-20

No. of Mths Year Ending		12 Sep-19*	12 Sep-20*	% Change
Net Sales	Rs m	137,672	106,178	-22.9%
Other income	Rs m	4,820	3,151	-34.6%
Total Revenues	Rs m	142,492	109,329	-23.3%
Gross profit	Rs m	14,348	10,535	-26.6%
Depreciation	Rs m	2,183	2,726	24.9%
Interest	Rs m	391	604	54.5%
Profit before tax	Rs m	16,594	10,356	-37.6%
Tax	Rs m	5,600	2,670	-52.3%
Profit after tax	Rs m	10,994	7,686	-30.1%
Gross profit margin	%	10.4	9.9
Effective tax rate	%	33.7	25.8
Net profit margin	%	8.0	7.2

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SIEMENS Balance Sheet Analysis

• The company's current liabilities during FY down at Rs 70 billion as compared to Rs 72 billion in FY, thereby witnessing an decrease of -2.7%.
• Current assets rose 1% and stood at Rs 139 billion, while fixed assets rose 9% and stood at Rs 83 billion in FY.
• Overall, the total assets and liabilities for FY stood at Rs 222 billion as against Rs 214 billion during FY, thereby witnessing a growth of 4%.

SIEMENS Balance Sheet as on September 2020

No. of Mths Year Ending		12 Sep-19*	12 Sep-20*	% Change
Networth	Rs m	90,494	94,920	4.9
Current Liabilities	Rs m	72,291	70,307	-2.7
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	214,309	221,857	3.5
Current assets	Rs m	137,996	138,879	0.6
Fixed Assets	Rs m	76,313	82,978	8.7
Total Assets	Rs m	214,309	221,857	3.5

SIEMENS Cash Flow Statement Analysis

• SIEMENS's cash flow from operating activities (CFO) during FY stood at Rs 7 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY stood at Rs 9 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY stood at Rs -4 billion on a YoY basis.
• Overall, net cash flows for the company during FY stood at Rs 12 billion from the Rs -2 billion net cash flows seen during FY.

SIEMENS Cash Flow Statement 2019-20

Particulars	No. of months	12	12	% Change
	Year Ending	Sep-19	Sep-20
Cash Flow from Operating Activities	Rs m	12,729	7,197	-43.5%
Cash Flow from Investing Activities	Rs m	-11,341	8,709	-
Cash Flow from Financing Activities	Rs m	-3,115	-3,860	-
Net Cash Flow	Rs m	-1,738	12,049	-

Current Valuations for SIEMENS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 21.6, an decline from the EPS of Rs 30.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,264.8, stands at 57.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.7 times, while the price to sales ratio stands at 4.2 times.
• The company's price to cash flow (P/CF) ratio stood at 45.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Sep-19*	12 Sep-20*
Sales per share (Unadj.)	Rs	386.6	298.2
TTM Earnings per share	Rs	30.9	21.6
Diluted earnings per share	Rs	30.9	21.6
Price to Cash Flow	x	40.9	45.6
TTM P/E ratio	x	48.9	57.0
Price / Book Value ratio	x	4.7	5.0
Market Cap	Rs m	421,718	474,281
Dividends per share (Unadj.)	Rs	7.0	7.0

Ratio Analysis for SIEMENS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 2.0x during FY, from 1.9x during FY. 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 18.1x during FY, from 43.4x during FY. 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 8.1% during FY, from 12.1% during FY. 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 11.5% during FY, from 18.8% during FY. 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 3.7% during FY, from 5.3% during FY. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Sep-19*	12 Sep-20*
Current ratio	x	1.9	2.0
Debtors’ Days	Days	101	108
Interest coverage	x	43.4	18.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	5.3	3.7
Return on equity	%	12.1	8.1
Return on capital employed	%	18.8	11.5

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

SIEMENS Share Price Performance

Over the last one year, SIEMENS share price has moved down from Rs 1,128.0 to Rs 1,111.6, registering a loss of Rs 16.4 or around 1.5%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 10,979.5 (up 1.3%). Over the last one year it has moved down from 18,472.0 to 10,979.5, a loss of 7,493 points (down 40.6%).

Overall, the S&P BSE SENSEX is down 24.2% over the year.

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

Read: Latest Annual Report Analysis of SIEMENS