FAZE THREE 2023-24 Annual Report Analysis

Thu, 3 Oct

FAZE THREE has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the company during FY23-24.

FAZE THREE Income Statement Analysis

• Operating income during the year rose 1.1% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 4.6% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.2% in FY24 as against 18.2% in FY23.
• Depreciation charges increased by 42.4% and finance costs increased by 43.9% YoY, respectively.
• Other income grew by 39.8% YoY.
• Net profit for the year declined by 20.1% YoY.
• Net profit margins during the year declined from 10.4% in FY23 to 8.3% in FY24.

FAZE THREE Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	5,582	5,645	1.1%
Other income	Rs m	56	78	39.8%
Total Revenues	Rs m	5,638	5,723	1.5%
Gross profit	Rs m	1,016	969	-4.6%
Depreciation	Rs m	145	206	42.4%
Interest	Rs m	151	217	43.9%
Profit before tax	Rs m	776	625	-19.5%
Tax	Rs m	193	159	-17.9%
Profit after tax	Rs m	583	466	-20.1%
Gross profit margin	%	18.2	17.2
Effective tax rate	%	24.9	25.4
Net profit margin	%	10.4	8.3

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FAZE THREE Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 3 billion as compared to Rs 2 billion in FY23, thereby witnessing an increase of 6.9%.
• Current assets rose 6% and stood at Rs 4 billion, while fixed assets rose 20% and stood at Rs 3 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 7 billion as against Rs 6 billion during FY23, thereby witnessing a growth of 12%.

FAZE THREE Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	3,346	3,807	13.8
Current Liabilities	Rs m	2,357	2,519	6.9
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	6,395	7,157	11.9
Current assets	Rs m	3,588	3,788	5.6
Fixed Assets	Rs m	2,808	3,369	20.0
Total Assets	Rs m	6,395	7,157	11.9

FAZE THREE Cash Flow Statement Analysis

• FAZE THREE's cash flow from operating activities (CFO) during FY24 stood at Rs 370 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -455 million, an improvement of 3.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -188 million on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -261 million from the Rs 596 million net cash flows seen during FY23.

FAZE THREE Cash Flow Statement 2023-24

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-23	Mar-24
Cash Flow from Operating Activities	Rs m	1,100	370	-66.4%
Cash Flow from Investing Activities	Rs m	-438	-455	-
Cash Flow from Financing Activities	Rs m	-60	-188	-
Net Cash Flow	Rs m	596	-261	-

Current Valuations for FAZE THREE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 19.2, an decline from the EPS of Rs 24.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 455.4, stands at 26.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 2.9 times, while the price to sales ratio stands at 2.0 times.
• The company's price to cash flow (P/CF) ratio stood at 15.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Sales per share (Unadj.)	Rs	229.5	232.1
TTM Earnings per share	Rs	24.0	19.2
Diluted earnings per share	Rs	24.0	19.2
Price to Cash Flow	x	10.6	15.3
TTM P/E ratio	x	13.2	26.7
Price / Book Value ratio	x	2.5	2.7
Market Cap	Rs m	8,338	10,311
Dividends per share (Unadj.)	Rs	0.5	0.0

Ratio Analysis for FAZE THREE

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.5x during FY24, from 1.5x during FY23. 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 3.9x during FY24, from 6.2x during FY23. 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 12.2% during FY24, from 17.4% during FY24. 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 22.1% during FY24, from 27.7% during FY23. 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 9.5% during FY24, from 11.5% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Current ratio	x	1.5	1.5
Debtors’ Days	Days	6	5
Interest coverage	x	6.2	3.9
Debt to equity ratio	x	0.0	0.0
Return on assets	%	11.5	9.5
Return on equity	%	17.4	12.2
Return on capital employed	%	27.7	22.1

To see how FAZE THREE has performed over the last 5 years, please visit here.

FAZE THREE Share Price Performance

Over the last one year, FAZE THREE share price has moved up from Rs 369.3 to Rs 455.4, registering a gain of Rs 86.2 or around 23.3%.

Overall, the S&P BSE SENSEX is up 27.6% over the year.

(To know more, check out historical annual results for FAZE THREE and quarterly results for FAZE THREE)