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SPENCERS RETAIL 2022-23 Annual Report Analysis

Mon, 17 Jul

SPENCERS RETAIL has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

SPENCERS RETAIL Income Statement Analysis

• Operating income during the year rose 5.1% on a year-on-year (YoY) basis.
• The company's operating profit was by NA YoY during the fiscal. Operating profit margins witnessed a growth and stood at 0.9% in FY23 as against 0.7% in FY22.
• Depreciation charges increased by 4.8% and finance costs increased by 18.8% YoY, respectively.
• Other income declined by 33.0% YoY.
• Net profit for the year grew by NA YoY.
• Net profit margins during the year declined from 5.7% in FY22 to 9.4% in FY23.

SPENCERS RETAIL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	21,202	22,289	5.1%
Other income	Rs m	853	571	-33.0%
Total Revenues	Rs m	22,056	22,860	3.6%
Gross profit	Rs m	155	-210	NA
Depreciation	Rs m	1,258	1,317	4.8%
Interest	Rs m	970	1,152	18.8%
Profit before tax	Rs m	-1,219	-2,108	NA
Tax	Rs m	-5	-4	NA
Profit after tax	Rs m	-1,215	-2,104	NA
Gross profit margin	%	0.7	-0.9
Effective tax rate	%	0.4	0.2
Net profit margin	%	-5.7	-9.4

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SPENCERS RETAIL Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 9 billion as compared to Rs 7 billion in FY22, thereby witnessing an increase of 19.5%.
• Long-term debt stood at Rs 2 billion as compared to Rs 1 billion during FY22, a growth of 42.7%.
• Current assets rose 1% and stood at Rs 4 billion, while fixed assets rose 5% and stood at Rs 13 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 16 billion as against Rs 16 billion during FY22, thereby witnessing a growth of 4%.

SPENCERS RETAIL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	615	-1,509	NA
Current Liabilities	Rs m	7,186	8,585	19.5
Long-term Debt	Rs m	1,267	1,809	42.7
Total Liabilities	Rs m	15,653	16,294	4.1
Current assets	Rs m	3,610	3,640	0.8
Fixed Assets	Rs m	12,043	12,654	5.1
Total Assets	Rs m	15,653	16,294	4.1

SPENCERS RETAIL Cash Flow Statement Analysis

• SPENCERS RETAIL's cash flow from operating activities (CFO) during FY23 stood at Rs 267 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -256 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -48 million, an improvement of 91% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -37 million from the Rs -401 million net cash flows seen during FY22.

SPENCERS RETAIL Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	546	267	-51.0%
Cash Flow from Investing Activities	Rs m	-402	-256	-
Cash Flow from Financing Activities	Rs m	-545	-48	-
Net Cash Flow	Rs m	-401	-37	-

Current Valuations for SPENCERS RETAIL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -23.3, an decline from the EPS of Rs -13.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 60.3, stands at -2.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at -3.6 times, while the price to sales ratio stands at 0.2 times.
• The company's price to cash flow (P/CF) ratio stood at -8.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	235.2	247.3
TTM Earnings per share	Rs	-13.5	-23.3
Diluted earnings per share	Rs	-13.5	-23.3
Price to Cash Flow	x	169.1	-8.6
TTM P/E ratio	x	-6.0	-2.6
Price / Book Value ratio	x	15.4	-4.5
Market Cap	Rs m	9,459	6,761
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for SPENCERS RETAIL

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.4x during FY23, from 0.5x during FY22. 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 -0.8x during FY23, from -0.3x during FY22. 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 139.5% during FY23, from -197.4% during FY23. 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 -318.6% during FY23, from -13.3% during FY22. 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 -5.8% during FY23, from -1.6% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	0.5	0.4
Debtors’ Days	Days	46	32
Interest coverage	x	-0.3	-0.8
Debt to equity ratio	x	2.1	-1.2
Return on assets	%	-1.6	-5.8
Return on equity	%	-197.4	139.5
Return on capital employed	%	-13.3	-318.6

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

SPENCERS RETAIL Share Price Performance

Over the last one year, SPENCERS RETAIL share price has moved down from Rs 70.5 to Rs 60.3, registering a loss of Rs 10.2 or around 14.5%.

Overall, the S&P BSE SENSEX is up 24.4% over the year.

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