SUZLON ENERGY 2018-19 Annual Report Analysis

Sun, 31 Mar

SUZLON ENERGY 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.

SUZLON ENERGY Income Statement Analysis

• Operating income during the year fell 38.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 103.5% YoY during the fiscal. Operating profit margins witnessed a growth and stood at 1.0% in FY19 as against 17.3% in FY18.
• Depreciation charges increased by 0.1% and finance costs decreased by 19.7% YoY, respectively.
• Other income declined by 6.4% YoY.
• Net profit for the year grew by 293.4% YoY.
• Net profit margins during the year declined from 4.8% in FY18 to 30.5% in FY19.

SUZLON ENERGY Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	81,162	50,247	-38.1%
Other income	Rs m	1,262	1,182	-6.4%
Total Revenues	Rs m	82,424	51,429	-37.6%
Gross profit	Rs m	14,056	-494	-103.5%
Depreciation	Rs m	3,416	3,419	0.1%
Interest	Rs m	15,810	12,699	-19.7%
Profit before tax	Rs m	-3,907	-15,430	294.9%
Tax	Rs m	-16	-119	662.8%
Profit after tax	Rs m	-3,892	-15,311	293.4%
Gross profit margin	%	17.3	-1.0
Effective tax rate	%	0.4	0.8
Net profit margin	%	-4.8	-30.5

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SUZLON ENERGY Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 109 billion as compared to Rs 102 billion in FY18, thereby witnessing an increase of 7.8%.
• Long-term debt down at Rs 62 billion as compared to Rs 77 billion during FY18, a fall of 19.1%.
• Current assets fell 23% and stood at Rs 65 billion, while fixed assets fell 10% and stood at Rs 24 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 89 billion as against Rs 111 billion during FY18, thereby witnessing a fall of 20%.

SUZLON ENERGY Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	-70,156	-84,976	21.1
Current Liabilities	Rs m	101,558	109,492	7.8
Long-term Debt	Rs m	77,157	62,441	-19.1
Total Liabilities	Rs m	111,206	88,709	-20.2
Current assets	Rs m	85,110	65,143	-23.5
Fixed Assets	Rs m	26,096	23,566	-9.7
Total Assets	Rs m	111,206	88,709	-20.2

SUZLON ENERGY Cash Flow Statement Analysis

• SUZLON ENERGY's cash flow from operating activities (CFO) during FY19 stood at Rs 13 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs 1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs -19 billion on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs -5 billion from the Rs 2 billion net cash flows seen during FY18.

SUZLON ENERGY 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	-1,094	12,667	-
Cash Flow from Investing Activities	Rs m	-1,335	1,252	-
Cash Flow from Financing Activities	Rs m	4,924	-18,983	-
Net Cash Flow	Rs m	2,450	-5,065	-

Current Valuations for SUZLON ENERGY

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -2.9, an decline from the EPS of Rs -0.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 6.2, stands at -3.7 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 0.7 times.
• The company's price to cash flow (P/CF) ratio stood at -3.4 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	15.3	9.4
TTM Earnings per share	Rs	-0.7	-2.9
Diluted earnings per share	Rs	-0.4	-1.7
Price to Cash Flow	x	-208.1	-3.4
TTM P/E ratio	x	-24.4	-3.7
Price / Book Value ratio	x	-1.2	-0.5
Market Cap	Rs m	87,457	40,138
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for SUZLON ENERGY

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.6x during FY19, from 0.8x 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 deteriorated and stood at -0.2x during FY19, from 0.8x 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 18.0% during FY19, from 5.5% 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 declined and down at 12.1% during FY19, from 170.0% 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 declined and down at -2.9% during FY19, from 10.7% 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	0.8	0.6
Debtors’ Days	Days	13	14
Interest coverage	x	0.8	-0.2
Debt to equity ratio	x	-1.1	-0.7
Return on assets	%	10.7	-2.9
Return on equity	%	5.5	18.0
Return on capital employed	%	170.0	12.1

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

SUZLON ENERGY Share Price Performance

Over the last one year, SUZLON ENERGY share price has moved down from Rs 10.7 to Rs 6.2, registering a loss of Rs 4.6 or around 42.7%.

Meanwhile, the S&P BSE OIL & GAS Index is trading at Rs 15,269.7 (up 0.9%). Over the last one year it has moved up from 14,614.4 to 15,269.7, a gain of 655 points (up 4.5%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

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

Read: Latest Annual Report Analysis of SUZLON ENERGY