MCLEOD RUSSEL 2022-23 Annual Report Analysis

Mon, 2 Oct

MCLEOD RUSSEL 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.

MCLEOD RUSSEL Income Statement Analysis

• Operating income during the year rose 1.0% on a year-on-year (YoY) basis.
• The company's operating profit was by NA YoY during the fiscal. Operating profit margins witnessed a growth and stood at 61.3% in FY23 as against 4.9% in FY22.
• Depreciation charges decreased by 6.6% and finance costs increased by 21.2% YoY, respectively.
• Other income grew by 48.0% YoY.
• Net profit for the year grew by NA YoY.
• Net profit margins during the year declined from 13.3% in FY22 to 77.1% in FY23.

MCLEOD RUSSEL Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	13,558	13,696	1.0%
Other income	Rs m	115	170	48.0%
Total Revenues	Rs m	13,673	13,866	1.4%
Gross profit	Rs m	666	-8,400	NA
Depreciation	Rs m	748	699	-6.6%
Interest	Rs m	1,655	2,005	21.2%
Profit before tax	Rs m	-1,622	-10,934	NA
Tax	Rs m	188	-369	NA
Profit after tax	Rs m	-1,809	-10,565	NA
Gross profit margin	%	4.9	-61.3
Effective tax rate	%	-11.6	3.4
Net profit margin	%	-13.3	-77.1

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MCLEOD RUSSEL Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 32 billion as compared to Rs 30 billion in FY22, thereby witnessing an increase of 5.2%.
• Long-term debt down at Rs 720 million as compared to Rs 1 billion during FY22, a fall of 41.2%.
• Current assets fell 10% and stood at Rs 5 billion, while fixed assets fell 22% and stood at Rs 34 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 39 billion as against Rs 49 billion during FY22, thereby witnessing a fall of 20%.

MCLEOD RUSSEL Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	16,487	5,693	-65.5
Current Liabilities	Rs m	29,965	31,533	5.2
Long-term Debt	Rs m	1,225	720	-41.2
Total Liabilities	Rs m	49,343	39,324	-20.3
Current assets	Rs m	5,688	5,105	-10.2
Fixed Assets	Rs m	43,655	34,219	-21.6
Total Assets	Rs m	49,343	39,324	-20.3

MCLEOD RUSSEL Cash Flow Statement Analysis

• MCLEOD RUSSEL's cash flow from operating activities (CFO) during FY23 stood at Rs 2 billion, an improvement of 94.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -414 million on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -112 million from the Rs -718 million net cash flows seen during FY22.

MCLEOD RUSSEL 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	1,050	2,045	94.9%
Cash Flow from Investing Activities	Rs m	-579	-414	-
Cash Flow from Financing Activities	Rs m	-1,189	-1,742	-
Net Cash Flow	Rs m	-718	-112	-

Current Valuations for MCLEOD RUSSEL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -101.1, an decline from the EPS of Rs -17.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 21.8, stands at -0.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.4 times, while the price to sales ratio stands at 0.2 times.
• The company's price to cash flow (P/CF) ratio stood at -0.3 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	129.8	131.1
TTM Earnings per share	Rs	-17.3	-101.1
Diluted earnings per share	Rs	-17.3	-101.1
Price to Cash Flow	x	-2.2	-0.3
TTM P/E ratio	x	-1.3	-0.2
Price / Book Value ratio	x	0.2	0.5
Market Cap	Rs m	3,204	3,009
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for MCLEOD RUSSEL

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 0.2x during FY23, from 0.2x 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 deteriorated and stood at -4.5x during FY23, from 0.0x 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 -185.6% during FY23, from -11.0% 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 -139.2% during FY23, from 0.2% 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 -21.8% during FY23, from -0.3% 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	0.2	0.2
Debtors’ Days	Days	132	106
Interest coverage	x	0.0	-4.5
Debt to equity ratio	x	0.1	0.1
Return on assets	%	-0.3	-21.8
Return on equity	%	-11.0	-185.6
Return on capital employed	%	0.2	-139.2

To see how MCLEOD RUSSEL has performed over the last 5 years, please visit here.

MCLEOD RUSSEL Share Price Performance

Over the last one year, MCLEOD RUSSEL share price has moved down from Rs 28.9 to Rs 21.8, registering a loss of Rs 7.1 or around 24.4%.

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

(To know more, check out historical annual results for MCLEOD RUSSEL and quarterly results for MCLEOD RUSSEL)