SUVEN LIFE SCIENCES 2018-19 Annual Report Analysis

Sun, 31 Mar

SUVEN LIFE SCIENCES 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.

SUVEN LIFE SCIENCES Income Statement Analysis

• Operating income during the year fell 54.3% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 105.4% YoY during the fiscal. Operating profit margins witnessed a growth and stood at 3.8% in FY19 as against 32.3% in FY18.
• Depreciation charges decreased by 42.7% and finance costs decreased by 58.7% YoY, respectively.
• Other income grew by 17.1% YoY.
• Net profit for the year declined by 119.3% YoY.
• Net profit margins during the year declined from 19.8% in FY18 to 8.4% in FY19.

SUVEN LIFE SCIENCES Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	6,253	2,857	-54.3%
Other income	Rs m	233	272	17.1%
Total Revenues	Rs m	6,485	3,129	-51.8%
Gross profit	Rs m	2,016	-110	-105.4%
Depreciation	Rs m	248	142	-42.7%
Interest	Rs m	46	19	-58.7%
Profit before tax	Rs m	1,955	2	-99.9%
Tax	Rs m	718	241	-66.5%
Profit after tax	Rs m	1,237	-239	-119.3%
Gross profit margin	%	32.3	-3.8
Effective tax rate	%	36.7	15,423.1
Net profit margin	%	19.8	-8.4

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SUVEN LIFE SCIENCES Balance Sheet Analysis

• The company's current liabilities during FY19 down at Rs 2 billion as compared to Rs 2 billion in FY18, thereby witnessing an decrease of -30.5%.
• Long-term debt down at Rs 18 million as compared to Rs 22 million during FY18, a fall of 20.2%.
• Current assets fell 41% and stood at Rs 4 billion, while fixed assets fell 94% and stood at Rs 224 million in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 4 billion as against Rs 10 billion during FY18, thereby witnessing a fall of 59%.

SUVEN LIFE SCIENCES Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	7,674	2,391	-68.8
Current Liabilities	Rs m	2,258	1,570	-30.5
Long-term Debt	Rs m	22	18	-20.2
Total Liabilities	Rs m	10,234	4,206	-58.9
Current assets	Rs m	6,738	3,982	-40.9
Fixed Assets	Rs m	3,496	224	-93.6
Total Assets	Rs m	10,234	4,206	-58.9

SUVEN LIFE SCIENCES Cash Flow Statement Analysis

• SUVEN LIFE SCIENCES's cash flow from operating activities (CFO) during FY19 stood at Rs -526 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs 371 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs 45 million, an improvement of 109% on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs -177 million from the Rs 173 million net cash flows seen during FY18.

SUVEN LIFE SCIENCES 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	699	-526	-
Cash Flow from Investing Activities	Rs m	-6	371	-
Cash Flow from Financing Activities	Rs m	-521	45	-
Net Cash Flow	Rs m	173	-177	-

Current Valuations for SUVEN LIFE SCIENCES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -1.9, an decline from the EPS of Rs 9.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 260.9, stands at 25.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 15.9 times, while the price to sales ratio stands at 11.6 times.
• The company's price to cash flow (P/CF) ratio stood at -332.4 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	49.1	22.4
TTM Earnings per share	Rs	9.7	-1.9
Diluted earnings per share	Rs	8.5	-1.6
Price to Cash Flow	x	16.4	-332.4
TTM P/E ratio	x	15.4	25.3
Price / Book Value ratio	x	3.4	13.5
Market Cap	Rs m	25,826	32,269
Dividends per share (Unadj.)	Rs	1.5	1.5

Ratio Analysis for SUVEN LIFE SCIENCES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.5x during FY19, from 3.0x 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 1.1x during FY19, from 43.2x 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 declined and down at -10.0% during FY19, from 16.1% 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 0.9% during FY19, from 26.0% 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 -5.2% during FY19, from 12.5% 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	3.0	2.5
Debtors’ Days	Days	359	34
Interest coverage	x	43.2	1.1
Debt to equity ratio	x	0.0	0.0
Return on assets	%	12.5	-5.2
Return on equity	%	16.1	-10.0
Return on capital employed	%	26.0	0.9

To see how SUVEN LIFE SCIENCES has performed over the last 5 years, please visit here.

SUVEN LIFE SCIENCES Share Price Performance

Over the last one year, SUVEN LIFE SCIENCES share price has moved up from Rs 167.8 to Rs 260.9, registering a gain of Rs 93.1 or around 55.5%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 14,407.9 (up 1.4%). Over the last one year it has moved up from 13,157.6 to 14,407.9, a gain of 1,250 points (up 9.5%).

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

(To know more, check out historical annual results for SUVEN LIFE SCIENCES and quarterly results for SUVEN LIFE SCIENCES)

Read: Latest Annual Report Analysis of SUVEN LIFE SCIENCES