VA TECH WABAG 2018-19 Annual Report Analysis

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VA TECH WABAG 2018-19 Annual Report Analysis
Mon, 23 Sep

VA TECH WABAG 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.

VA TECH WABAG Income Statement Analysis

  • Operating income during the year fell 19.6% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 33.5% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 7.0% in FY19 as against 8.4% in FY18.
  • Depreciation charges decreased by 5.9% and finance costs increased by 30.6% YoY, respectively.
  • Other income declined by 23.0% YoY.
  • Net profit for the year declined by 39.3% YoY.
  • Net profit margins during the year declined from 4.2% in FY18 to 3.2% in FY19.

VA TECH WABAG Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 34,573 27,810 -19.6%
Other income Rs m 57 44 -23.0%
Total Revenues Rs m 34,629 27,853 -19.6%
Gross profit Rs m 2,918 1,941 -33.5%
Depreciation Rs m 178 168 -5.9%
Interest Rs m 577 753 30.6%
Profit before tax Rs m 2,219 1,064 -52.1%
Tax Rs m 774 205 -73.5%
Profit after tax Rs m 1,471 892 -39.3%
Gross profit margin % 8.4 7.0
Effective tax rate % 34.9 19.3
Net profit margin % 4.2 3.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



VA TECH WABAG Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 24 billion as compared to Rs 23 billion in FY18, thereby witnessing an increase of 5.4%.
  • Long-term debt stood at Rs 960 million as compared to Rs 499 million during FY18, a growth of 92.2%.
  • Current assets rose 2% and stood at Rs 31 billion, while fixed assets fell 11% and stood at Rs 2 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 38 billion as against Rs 37 billion during FY18, thereby witnessing a growth of 1%.

VA TECH WABAG Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 11,287 10,689 -5.3
 
Current Liabilities Rs m 22,947 24,197 5.4
Long-term Debt Rs m 499 960 92.2
Total Liabilities Rs m 37,303 37,785 1.3
 
Current assets Rs m 30,198 30,901 2.3
Fixed Assets Rs m 1,768 1,570 -11.2
Total Assets Rs m 37,303 37,785 1.3
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



VA TECH WABAG Cash Flow Statement Analysis

  • VA TECH WABAG's cash flow from operating activities (CFO) during FY19 stood at Rs -763 million on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs 112 million on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 486 million on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -184 million from the Rs -1 billion net cash flows seen during FY18.

VA TECH WABAG 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 -2,158 -763 -
Cash Flow from Investing Activities Rs m -108 112 -
Cash Flow from Financing Activities Rs m 1,061 486 -54.2%
Net Cash Flow Rs m -1,062 -184 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for VA TECH WABAG

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 16.3, an decline from the EPS of Rs 26.9 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 281.0, stands at 20.4 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.0 times, while the price to sales ratio stands at 0.8 times.
  • The company's price to cash flow (P/CF) ratio stood at 14.8 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 632.5 508.5
TTM Earnings per share Rs 26.9 16.3
Diluted earnings per share Rs 27.2 16.5
Price to Cash Flow x 9.5 14.8
TTM P/E ratio x 20.6 20.4
Price / Book Value ratio x 2.9 2.0
Market Cap Rs m 15,359 15,219
Dividends per share (Unadj.) Rs 4.0 4.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for VA TECH WABAG

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY19, from 1.3x 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 2.4x during FY19, from 4.8x 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 declined and down at 8.3% during FY19, from 13.0% 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 15.9% during FY19, from 23.9% 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 4.4% during FY19, from 5.5% 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 1.3 1.3
Debtors’ Days Days 138 177
Interest coverage x 4.8 2.4
Debt to equity ratio x 0.0 0.1
Return on assets % 5.5 4.4
Return on equity % 13.0 8.3
Return on capital employed % 23.9 15.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



To see how VA TECH WABAG has performed over the last 5 years, please visit here.

VA TECH WABAG Share Price Performance

Over the last one year, VA TECH WABAG share price has moved down from Rs 386.2 to Rs 281.0, registering a loss of Rs 105.2 or around 27.2%.

Meanwhile, the S&P BSE CAPITAL GOODS Index is trading at Rs 19,035.1 (up 5.3%). Over the last one year it has moved up from 18,058.2 to 19,035.1, a gain of 977 points (up 5.4%).

Overall, the S&P BSE SENSEX is up 5.3% over the year.

(To know more, check out historical annual results for VA TECH WABAG and quarterly results for VA TECH WABAG)

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