Kanco Enterprises Ltd Annual Report and Financials

Kanco Enterprises Balance Sheet (Rs in Thousands)

Kanco Enterprises Profit & Loss Statement (Rs in Thousands)

 Kanco Enterprises 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:

Operating activities show the cash generated or used by the company from its core business operations.

(Loss)/Profit Before Tax: For the year ending 3/31/2024, the company reported a loss before tax of Rs. 1,790.47 thousand, in contrast to a profit of Rs. 7,928.47 thousand for the previous year. This indicates a decline in profitability during the year.

Adjustments for Depreciation and Amortisation: Depreciation and amortisation expenses remain the same at Rs. 111.58 thousand for both years. These are non-cash charges, and while they reduce taxable income, they don 't affect cash flow.

Finance Costs: The finance costs (interest on loans or borrowings) increased from Rs. 4.55 thousand in 2023 to Rs. 9.05 thousand in 2024. The higher finance cost in 2024 suggests an increase in borrowing or interest rates.

Other Current Assets: There was a significant increase in other current assets by Rs. 5,315.77 thousand in 2024, compared to a decrease of Rs. 5,469.02 thousand in 2023. This could indicate an increase in receivables or other short-term assets, implying that cash is tied up in non-liquid assets.

Other Current Financial Liabilities: The decrease in other current financial liabilities by Rs. 115.02 thousand in 2024 (compared to a decrease of Rs. 925.37 thousand in 2023) indicates a reduction in financial obligations.

Other Current Liabilities: The movement in other current liabilities shows a net reduction of Rs. 1,662.98 thousand in 2024, compared to an increase of Rs. 1,649.95 thousand in 2023, implying that the company has reduced its short-term obligations during the year.

Cash Generated from Operations: The company generated Rs. 1,867.93 thousand in cash from operations in 2024, a decrease from Rs. 3,300.16 thousand in 2023, reflecting a decline in cash flow due to lower profitability and increased changes in working capital.

Direct Taxes net of refunds: Taxes paid increased slightly from Rs. 354.65 thousand in 2023 to Rs. 292.70 thousand in 2024.

Net Cash Generated from Operating Activities: After accounting for tax payments, the company generated Rs. 2,160.63 thousand in cash from operating activities in 2024, which is lower than Rs. 2,945.52 thousand in 2023. This reflects a weaker cash inflow from operations in the current year.

Cash Flows from Financing Activities:

The financing activities section reflects cash movements related to the company’s capital structure.

Repayment in Borrowings: The company repaid Rs. 2,268.00 thousand in borrowings during 2024, which is a smaller repayment compared to Rs. 2,835.00 thousand in 2023. The higher repayment in 2023 suggests the company was reducing its debt more aggressively that year.

Interest Paid: The interest paid increased from Rs. 4.55 thousand in 2023 to Rs. 9.05 thousand in 2024, consistent with the rise in finance costs mentioned earlier.

Net Cash Used in Financing Activities: The net cash outflow from financing activities was Rs. 2,277.05 thousand in 2024, which was slightly lower than Rs. 2,839.55 thousand in 2023. This indicates that while the company continued to reduce its borrowings, the cash outflow was not as significant as the previous year.

Net Increase/Decrease in Cash and Cash Equivalents:

The overall net cash flow from all activities was negative, with a decrease of Rs. 116.42 thousand in 2024, compared to a positive increase of Rs. 105.97 thousand in 2023. This indicates a reduction in the company’s available cash during 2024, primarily due to operating losses and financing outflows.

 Financial Ratios of Kanco Enterprises

Here is a summary of the financial and operational metrics for Kanco Enterprises for the year 2024 and 2023:

The Current Ratio for the year 2023-24 is 0.32, which is below the ideal ratio of 1:1. This indicates that the company has fewer short-term assets than liabilities, suggesting potential liquidity problems and difficulty in meeting its short-term obligations. In comparison, the Current Ratio for 2022-23 was 0.4, which, although still below the ideal threshold, reflects a slightly better liquidity position than in 2023-24.

The Debt-Equity Ratio for 2023-24 is -0.26, indicating that the company has more liabilities than equity. This negative ratio suggests a reliance on debt to finance operations, possibly resulting in a negative net worth. In 2022-23, the ratio was -0.35, also negative, showing that the company’s reliance on debt was even higher that year. The slight improvement in 2023-24 points to some reduction in the company’s debt burden.

The Debt Service Coverage Ratio (DSCR) for 2023-24 is -196.84, a significantly negative figure. This implies that the company’s earnings are insufficient to meet its debt obligations, which indicates severe financial distress. On the other hand, the DSCR for 2022-23 was 1743.52, which was very strong, showing that the company had ample earnings to cover its debt service, highlighting a drastic decline in 2023-24.

The Return on Equity (ROE) for 2023-24 is 6%, indicating that the company managed to generate a positive return on the capital invested by shareholders. This represents a recovery from the previous year, when the ROE was -28%, signaling the company’s inability to generate any profits from shareholder equity and reflecting poor financial performance in 2022-23.

The Net Capital Turnover Ratio for 2023-24 is 0, which indicates that the company did not generate any sales relative to the capital it employed. This is a concerning figure, suggesting inefficiency in utilizing its capital to generate revenue. In 2022-23, the Net Capital Turnover Ratio was -0.37, also negative, meaning that the company was inefficient in using its capital to generate sales even in the previous year.

The Net Profit Ratio for 2023-24 is -37.95%, showing that the company incurred a significant loss of nearly 38% on its sales. This is a considerable decline in profitability compared to 2022-23, when the Net Profit Ratio was 0.77%, indicating a small profit margin but still showing much better profitability than in 2023-24.

The Return on Capital Employed (ROCE) for 2023-24 is 6%, which is positive but relatively low. It shows that the company generated a modest return on the capital it employed, though it is far from an ideal or efficient rate of return. In 2022-23, the ROCE was -28%, reflecting that the company did not generate any return on its employed capital, which highlights poor utilization of resources in that year.

The Return on Investment (ROI) for 2023-24 is 6%, similar to the ROE and ROCE, indicating a modest return on the company’s investments. This shows a slight improvement compared to 2022-23, where the ROI was -28%, reflecting negative returns on investments and poor financial performance in that period.