Fortune Industrial Resources Ltd Annual Report and Financials

Fortune Industrial Resources Limited Balance Sheet (Rs in Lakhs)

Fortune Industrial Resources Limited Profit & Loss Statement (Rs in Lakhs)

 Fortune Industrial Resources Limited Consolidated Cash Flow Statement (Rs in Lakhs)

Here is a summary of the Cash Flow Statement for the years 2024 and 2023:

Operating Activities:

The company's Profit Before Tax (PBT) in FY 2024 was Rs. 2.78 Lakhs, a significant turnaround from the loss of Rs. (84.21) Lakhs in FY 2023. This shift from a loss to a small profit indicates a positive change in the company's operational efficiency and its ability to generate revenue from its core business activities.

However, adjustments for non-cash items, such as the Net Loss/(Gain) on investments measured at FVTPL (Fair Value Through Profit or Loss), showed a loss of Rs. (7.11) Lakhs in FY 2024, compared to a smaller loss of Rs. (3.84) Lakhs in FY 2023. These losses reflect unrealized fluctuations in the value of financial assets, which do not impact cash flow directly but affect the reported profit. The Operating Profit Before Working Capital Changes in FY 2024 was Rs. (4.33) Lakhs, a notable improvement from the much larger negative figure of Rs. (88.05) Lakhs in the previous year. This improvement suggests that despite continuing challenges, the company’s operational performance showed better control over costs and revenues.

Looking at working capital changes, the company saw an increase in Loans of Rs. 86.74 Lakhs in FY 2024, up from Rs. 69.76 Lakhs in FY 2023. This indicates that more cash was tied up in loans provided to clients, but it also reflects the company's core business of lending. On the other hand, Other Financial Assets increased by Rs. (55.51) Lakhs in FY 2024, which means the company invested more cash into financial assets, reducing its available liquidity compared to Rs. (46.57) Lakhs in the prior year. The Trade Receivables also increased by Rs. (2.05) Lakhs, a minor shift from zero in the previous year, indicating that the company’s receivables grew slightly.

The company’s Other Financial Liabilities increased by Rs. 24.11 Lakhs in FY 2024, reflecting additional cash inflows from financial obligations. Meanwhile, Other Non-Financial Liabilities showed a small negative change of Rs. (2.16) Lakhs, which slightly reduced the cash flow from this area. Overall, the company generated Rs. 46.81 Lakhs in cash from operations in FY 2024, compared to a cash outflow of Rs. (61.78) Lakhs in FY 2023. This marked improvement in cash generation from operations reflects better working capital management and increased operational efficiency. After income taxes paid of Rs. (6.48) Lakhs in FY 2024, the Net Cash Flow from Operating Activities was positive at Rs. 40.32 Lakhs, a sharp recovery from the negative cash flow of Rs. (70.58) Lakhs the year before.

Investing Activities:

In FY 2024, the company did not record any significant inflows from the sale of investments, in contrast to FY 2023 when it generated Rs. 88.95 Lakhs from the sale of investments. The company made a modest investment of Rs. (17.30) Lakhs in Property, Plant, and Equipment in FY 2024, which slightly reduced its available cash. Additionally, the company had a small cash outflow of Rs. (0.02) Lakhs from prepaid expenses. Overall, the Net Cash Flow from Investing Activities was negative at Rs. (17.32) Lakhs in FY 2024, compared to a positive inflow of Rs. 88.95 Lakhs in FY 2023, reflecting a shift from investment disposals to more spending on fixed assets.

Cash and Cash Equivalents:

The net effect of all activities resulted in a net increase in Cash and Cash Equivalents of Rs. 23 Lakhs during FY 2024, compared to an increase of Rs. 18.37 Lakhs in FY 2023. As of the end of FY 2024, the company held Rs. 65.47 Lakhs in cash and cash equivalents, a significant rise from Rs. 42.48 Lakhs at the end of FY 2023. This increase reflects the company's overall improvement in liquidity, driven mainly by positive cash flows from operating activities, despite some outflows from investing and financing activities.

Financial Ratios of Fortune Industrial Resources Limited

Here is a summary of the financial and operational metrics for Fortune Industrial Resources Limited for the year 2024 and 2023:

Current Ratio:

The current ratio measures the company's ability to cover its short-term liabilities with its short-term assets. A current ratio of 9.19 in 2024 indicates an exceptionally strong liquidity position, meaning the company has significantly more assets than liabilities.

Debt Equity Ratio:

The debt equity ratio measures the proportion of debt to equity financing. A ratio of 0.02 in 2024 is very low, indicating that the company is primarily equity-financed and has minimal reliance on debt. This is a significant improvement from 0.05 in 2023, reflecting a reduction in leverage, suggesting that the company has either paid down its debt or increased equity funding, thereby reducing financial risk.

Debt Service Coverage Ratio (DSCR):

The debt service coverage ratio measures the company's ability to cover its debt obligations (interest and principal payments) from its operating income. A ratio of 0.97 in 2024 shows that the company’s operating income is almost sufficient to cover its debt service, compared to just 0.19 in 2023, which indicates a severe cash flow constraint.

Return on Equity (ROE):

Return on equity (ROE) measures the profitability of the company relative to shareholders' equity. In 2024, the ROE is not provided, but it would likely have improved from a negative figure of -0.01 in 2023. A negative ROE in 2023 indicated a slight loss in relation to shareholders' equity, and the absence of a figure in 2024 could indicate either a small profit or further negative performance. A detailed breakdown of net income or loss would be necessary to assess this fully.

Trade Receivables Turnover Ratio:

The trade receivables turnover ratio measures how efficiently a company collects payments from its customers. A ratio of 36.66 in 2024 indicates that the company collects its receivables approximately 37 times during the year, suggesting that its credit and collection policies are very efficient.

Net Capital Turnover Ratio:

The net capital turnover ratio measures how efficiently the company uses its capital to generate revenue. A decrease from 1.19 in 2023 to 0.62 in 2024 indicates a decline in the efficiency of capital utilization. This suggests that in 2024, the company generated less revenue for each unit of capital employed compared to the previous year, possibly due to reduced sales or increased capital expenditure.

Net Profit Ratio:

The net profit ratio measures the percentage of profit relative to sales. A ratio of -0.1% in 2024, an improvement from -2.48% in 2023, suggests that the company’s profitability has improved, although it remains negative. This implies that the company has reduced its losses significantly in 2024 compared to 2023, potentially due to higher revenue or improved cost control, though it is still not profitable on a net basis.