Haileyburia Tea Estates Ltd Annual Report and Financials

Haileyburia Tea Estates Limited Balance Sheet (Rs in Thousands)

Haileyburia Tea Estates Limited Profit & Loss Statement (Rs in Thousands)

 Haileyburia Tea Estates Limited Consolidated Cash Flow Statement (Rs in Thousands)

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

Cash Flow from Operating Activities

The cash flow from operating activities shows a net outflow of Rs. -44,447.77 thousand in 2024, a sharp decline from an inflow of Rs. 12,491.44 thousand in 2023. This negative cash flow stems from a net loss before tax and extraordinary items of Rs. -38,067.77 thousand, though it is an improvement over the previous year's loss of Rs. -49,797.57 thousand. Additionally, adjustments for interest paid (Rs. 20,625.90 thousand) and depreciation (Rs. 2,045.50 thousand) add back some non-cash expenses, but the impact of working capital adjustments was substantial. There was a significant decrease in inventories (Rs. -12,467.54 thousand) and a reduction in trade and other payables (Rs. -8,617.59 thousand and Rs. -10,162.93 thousand, respectively), contributing to the operating cash outflow. These changes indicate a strain on cash flow due to declining payables and adjustments in receivables and inventories.

Cash Flow from Investing Activities

Investing activities produced a substantial net inflow of Rs. 61,719.43 thousand in 2024, up significantly from the prior year’s Rs. 12,035.23 thousand. This strong cash inflow was driven primarily by proceeds from the sale of fixed assets amounting to Rs. 61,996.50 thousand, which far exceeded the purchase of fixed assets (Rs. -545.35 thousand). Additional contributions came from miscellaneous income and rental income, totaling Rs. 268.28 thousand. The considerable net inflow from investing activities offsets some of the operating cash outflows, demonstrating a reliance on asset sales for liquidity.

Cash Flow from Financing Activities

Financing activities resulted in a net cash outflow of Rs. -17,323.21 thousand in 2024, which, while negative, is an improvement over the Rs. -24,433.64 thousand outflow seen in 2023. The primary components were interest payments (Rs. -20,625.90 thousand) and proceeds from borrowings (Rs. 3,302.69 thousand). The negative net cash flow reflects high financing costs, with significant interest payments impacting cash reserves. The improvement over the previous year may indicate a cautious reduction in reliance on debt.

Net Increase/Decrease in Cash & Cash Equivalents

The net change in cash and cash equivalents for 2024 was a slight decrease of Rs. -51.55 thousand, compared to an increase of Rs. 93.03 thousand in 2023. This resulted in a year-end cash balance of Rs. 156.28 thousand, down from Rs. 207.84 thousand at the beginning of the year. This marginal decrease in cash reserves highlights the company's challenges in generating cash from operations, despite significant inflows from investing activities.

Financial Ratios of Haileyburia Tea Estates Limited

Here is a summary of the financial and operational metrics for Haileyburia Tea Estates Limited for the year 2024 and 2023:

Current Ratio: The current ratio improved slightly from 0.16 in 2022-2023 to 0.2 in 2023-2024. However, a ratio below 1 indicates the company may struggle to cover its short-term liabilities with its current assets, suggesting ongoing liquidity challenges.

Debt-Equity Ratio: This ratio saw a slight decrease from 0.43 to 0.41, indicating a marginal reduction in reliance on debt relative to equity. This low ratio reflects a conservative debt approach, though the company may be limiting its financing options for expansion or operational needs.

Debt Service Coverage Ratio: A significant improvement from -0.59 in the prior year to 1.78 in 2023-2024 indicates the company’s improved ability to meet its debt obligations. A positive ratio above 1 suggests better financial health, implying that operating income is now adequate to cover debt payments.

Return on Equity (ROE): The ROE improved to 1.41 from a negative -2.44, indicating a return to profitability and more efficient equity utilization. This positive ROE suggests value creation for shareholders after previous losses.

Inventory Turnover Ratio: This ratio declined from 8.05 to 6.03, reflecting a slower rate of inventory turnover, possibly due to lower demand or increased holding times. Lower turnover can impact cash flow if inventory remains unsold for longer periods.

Trade Receivables Turnover Ratio: This ratio increased from 13.67 to 14.83, signaling that the company has improved its efficiency in collecting receivables. Higher turnover rates suggest effective credit management and quicker conversion of receivables to cash.

Trade Payables Turnover Ratio: A decline from 1.41 to 1.14 indicates that the company is taking longer to pay its suppliers. While this may help with short-term cash management, prolonged payment periods can affect supplier relationships.

Net Capital Turnover Ratio: The ratio remains negative, though it slightly improved from -0.96 to -0.86. This suggests that the company’s capital structure may be inefficient, with liabilities exceeding assets, impacting its ability to generate revenue effectively.

Net Profit Ratio: The improvement from -0.2 to 0.11 indicates a shift to profitability, showing that the company is now generating positive net income as a percentage of its revenue, which may be the result of cost control or increased revenue.

Return on Capital Employed (ROCE): This ratio improved from -0.02 to 0.06, showing the company is generating a positive return on its total capital employed. A positive ROCE suggests improved efficiency in utilizing capital, though the modest level implies there is room for further improvement in overall profitability.