UNITED BREWERIES 2022-23 Annual Report Analysis

Fri, 21 Jul

UNITED BREWERIES 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.

UNITED BREWERIES Income Statement Analysis

• Operating income during the year was NA on a year-on-year (YoY) basis.
• The company's operating profit decreased by 16.3% YoY during the fiscal. Operating profit margins witnessed a growth and down at 35.3% in FY23 as against 48.1% in FY22.
• Depreciation charges decreased by 3.0% and finance costs decreased by 68.6% YoY, respectively.
• Other income grew by 65.9% YoY.
• Net profit for the year declined by 16.8% YoY.
• Net profit margins during the year grew from 25.3% in FY22 to 18.5% in FY23.

UNITED BREWERIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	-14,470	-16,513	NA
Other income	Rs m	298	494	65.9%
Total Revenues	Rs m	-14,173	-16,018	NA
Gross profit	Rs m	6,966	5,831	-16.3%
Depreciation	Rs m	2,172	2,106	-3.0%
Interest	Rs m	148	46	-68.6%
Profit before tax	Rs m	4,944	4,173	-15.6%
Tax	Rs m	1,284	1,126	-12.3%
Profit after tax	Rs m	3,661	3,047	-16.8%
Gross profit margin	%	-48.1	-35.3
Effective tax rate	%	26.0	27.0
Net profit margin	%	-25.3	-18.5

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UNITED BREWERIES Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 23 billion as compared to Rs 20 billion in FY22, thereby witnessing an increase of 15.3%.
• Current assets rose 9% and stood at Rs 37 billion, while fixed assets rose 0% and stood at Rs 27 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 64 billion as against Rs 60 billion during FY22, thereby witnessing a growth of 5%.

UNITED BREWERIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	39,351	39,649	0.8
Current Liabilities	Rs m	19,746	22,775	15.3
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	60,429	63,557	5.2
Current assets	Rs m	33,743	36,816	9.1
Fixed Assets	Rs m	26,638	26,693	0.2
Total Assets	Rs m	60,429	63,557	5.2

UNITED BREWERIES Cash Flow Statement Analysis

• UNITED BREWERIES's cash flow from operating activities (CFO) during FY23 stood at Rs -1 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -3 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -5 billion from the Rs 5 billion net cash flows seen during FY22.

UNITED BREWERIES 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	8,996	-1,196	-
Cash Flow from Investing Activities	Rs m	-1,601	-1,208	-
Cash Flow from Financing Activities	Rs m	-2,867	-2,923	-
Net Cash Flow	Rs m	4,529	-5,327	-

Current Valuations for UNITED BREWERIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 11.5, an decline from the EPS of Rs 13.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,522.3, stands at 132.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 10.2 times, while the price to sales ratio stands at -24.4 times.
• The company's price to cash flow (P/CF) ratio stood at 82.2 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	-54.7	-62.5
TTM Earnings per share	Rs	13.8	11.5
Diluted earnings per share	Rs	13.8	11.5
Price to Cash Flow	x	67.5	82.2
TTM P/E ratio	x	107.5	132.1
Price / Book Value ratio	x	9.6	10.7
Market Cap	Rs m	375,938	423,511
Dividends per share (Unadj.)	Rs	10.5	7.5

Ratio Analysis for UNITED BREWERIES

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.6x during FY23, from 1.7x 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 improved and stood at 90.9x during FY23, from 34.5x 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 declined and down at 7.7% during FY23, from 9.3% 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 10.6% during FY23, from 12.9% 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 4.9% during FY23, from 6.3% 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	1.7	1.6
Debtors’ Days	Days	-3,165	-3,111
Interest coverage	x	34.5	90.9
Debt to equity ratio	x	0.0	0.0
Return on assets	%	6.3	4.9
Return on equity	%	9.3	7.7
Return on capital employed	%	12.9	10.6

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

UNITED BREWERIES Share Price Performance

Over the last one year, UNITED BREWERIES share price has moved down from Rs 1,667.5 to Rs 1,522.3, registering a loss of Rs 145.2 or around 8.7%.

Overall, the S&P BSE SENSEX is up 20.4% over the year.

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