Fancy Fittings Annual Reports, Balance Sheet and Financials

 Fancy Fittings Limited Balance Sheet (Rs in Lakhs)

Fancy Fittings Limited Profit & Loss Statement (Rs in Lakhs)

 Fancy Fittings Limited Cash Flow Statement (Rs in Lakhs)

Here is a summary of the Cash Flow Statement for the years 2023 and 2022:

Cash Flow from Operating Activities:

The company reported a net loss after tax and extraordinary items of Rs. 51.34 lakhs in FY 2023-24, compared to a net loss of Rs. 298.95 lakhs in FY 2022-23. While both years show a loss, the current year’s loss is notably less severe, indicating a potential improvement in operational performance.

However, adjustments for non-cash items and working capital changes provide further insight. The depreciation charge was minimal in 2023-24 (Rs. 1.31 lakhs), suggesting low capital expenditure or asset write-offs, while the prior year saw a significant profit on the sale of fixed assets (Rs. 223.48 lakhs), indicating asset divestitures that boosted cash in 2022-23.

Working capital changes in 2023-24 reflect a mixed situation:

Trade Payables increased by Rs. 89.68 lakhs (up from Rs. 157.9 lakhs), signaling that the company delayed payments to suppliers, effectively conserving cash.

Current provisions increased by Rs. 59.92 lakhs, likely linked to provisions for liabilities or expenses, which also drained cash.

Other current liabilities rose significantly by Rs. 271.08 lakhs (compared to Rs. 192.28 lakhs in the previous year), suggesting that the company relied on increased liabilities to manage liquidity.

Inventories and trade & other receivables saw more moderate increases, with inventories increasing by Rs. 49.75 lakhs (vs. Rs. 99.99 lakhs last year), and receivables rising by Rs. 25.86 lakhs (vs. Rs. 144.17 lakhs), suggesting less strain on working capital compared to the previous year.

Ultimately, cash flow from operating activities in FY 2023-24 was negative Rs. 207.4 lakhs, indicating that despite improvements in losses, the company’s operations still consumed more cash than they generated. In contrast, FY 2022-23 had a positive cash flow from operations of Rs. 596.8 lakhs, which was largely driven by the sale of assets and working capital changes, including a reduction in receivables and inventories.

Cash Flow from Investing Activities:

In FY 2023-24, the company spent Rs. 518.35 lakhs on the purchase of fixed assets, indicating a significant investment in property, plant, or equipment, or possibly expansion into new areas. This was a sharp increase compared to the previous year, where only Rs. 2.17 lakhs were spent on fixed assets. Additionally, there was a slight decrease in non-current financial assets (Rs. 5.46 lakhs) and an increase in non-current assets in 2022-23 (Rs. 52.17 lakhs). Overall, net cash flow from investing activities was Rs. 512.89 lakhs (outflow), a significant rise from the previous year’s outflow of Rs. 50 lakhs.

Cash Flow from Financing Activities:

Cash flow from financing activities was a negative Rs. 52.7 lakhs in both years, with the primary activity being a reduction in borrowings. This could imply that the company paid off some of its debt or reduced its reliance on external financing sources. The outflow in financing activities is lower than the previous year 's Rs. 95.03 lakhs, suggesting less reliance on debt to fund operations or investments.

Net Cash Flow and Cash Equivalents:

Despite the negative cash flow from operations and financing activities, the company recorded a net increase in cash and cash equivalents of Rs. 252.78 lakhs for the year, compared to Rs. 551.77 lakhs in the previous year. The decrease in the overall net increase in cash compared to the prior year could be due to the higher capital expenditures in investing activities. The closing balance of cash and cash equivalents stood at Rs. 252.78 lakhs, down from Rs. 551.77 lakhs in the previous year, reflecting the heavy outflows related to asset purchases.

Financial Ratios of Fancy Fittings Limited

Here is a summary of the financial and operational metrics for Fancy Fittings Limited for the year 2023 and 2022:

Current Ratio

The current ratio measures a company 's ability to meet its short-term obligations with its short-term assets (i.e., assets that are expected to be converted to cash within a year). A ratio of 0.48 in 2022-23 indicates that the company has only 48 paise of current assets for every rupee of current liabilities, which is below the generally accepted benchmark of 1.0. This suggests that the company may struggle to meet its short-term liabilities without securing additional funding or liquidating assets.

Trade Receivables Turnover Ratio

The trade receivables turnover ratio measures how many times a company collects its average accounts receivable during the year. A ratio of 6.58 in 2022-23 means the company collected its receivables about 6.58 times during the year, which is similar to the 6.74 times in 2021-22. This shows that the company has been relatively consistent in managing its receivables.

Trade Payables Turnover Ratio

The trade payables turnover ratio measures how quickly a company pays off its creditors. In 2022-23, the ratio was 2.24, which means the company paid off its payables about 2.24 times during the year. In 2021-22, this ratio was 3.06, indicating faster payment to creditors in the previous year.

Net Profit Ratio

The net profit ratio is a measure of profitability, indicating what percentage of sales is converted into profit. A negative value suggests the company is incurring losses. In 2022-23, the net profit ratio worsened to -0.29%, compared to -0.07% in 2021-22.

Debt Equity Ratio

The debt-equity ratio measures a company’s financial leverage by comparing its total debt to its equity. A ratio of 14.04 in 2022-23 indicates an extremely high reliance on debt financing relative to equity, meaning the company is significantly leveraged. In comparison, the ratio in 2021-22 was much lower at 2.82, suggesting the company had a more balanced capital structure in the prior year.

Debt Service Coverage Ratio (DSCR)

The debt service coverage ratio measures a company’s ability to cover its debt obligations (interest and principal repayments) with its operating income. A DSCR of less than 1 indicates that the company is not generating enough income to cover its debt obligations. In 2022-23, the ratio is -1.59, which means the company is not only unable to cover its debt service but is generating negative income for this purpose.

Return on Equity (ROE)

The return on equity measures how efficiently a company is using shareholders ' equity to generate profits. A negative ROE indicates the company is losing money in relation to its equity base. In 2022-23, ROE worsened to -1.36%, compared to -0.31% in 2021-22. This suggests a deterioration in profitability, with the company becoming less efficient in generating returns for shareholders.

Inventory Turnover Ratio

The inventory turnover ratio measures how many times the company sold and replaced its inventory during the year. A decrease from 2.99 in 2021-22 to 2.45 in 2022-23 suggests that the company is now selling its inventory at a slower rate, which could be due to a buildup of unsold stock or a slowdown in sales

Net Capital Turnover Ratio

The net capital turnover ratio measures the efficiency with which a company utilizes its capital to generate revenue. A negative value suggests the company is not generating any positive revenue from its capital, and it’s likely that its operations are underperforming. While the ratio improved from -8.94 in 2021-22 to -5.19 in 2022-23, it still indicates very poor capital utilization.

Return on capital employed

The return on capital employed measures a company’s ability to generate profits from its capital. A negative ROCE in both years indicates that the company is not earning a return on its employed capital, which is concerning for investors and stakeholders.