Bormah Jan Annual Reports, Balance Sheet and Financials

The Bormah Jan Tea Company Balance Sheet (Rs in Thousands)

The Bormah Jan Tea Company Profit & Loss Statement (Rs in Thousands)

The Bormah Jan Tea Company 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

In 2024, the company reported a net loss before tax of Rs -27,958.32, a significant downturn from the profit of Rs 2,478.09 in 2023. However, adjustments for non-cash expenses such as depreciation (Rs 13,068.84) and finance costs (Rs 19,645.18), along with a rise in trade payables (Rs 25,335.11), helped generate positive cash flow from operations. Working capital changes played a crucial role, with inventory reduction (Rs -3,972.32) and trade receivables adjustments contributing. As a result, the company generated Rs 14,951.27 in cash from operations, compared to Rs 18,306.98 in 2023. After taxes, the net cash from operating activities stood at Rs 11,170.14, lower than the previous year's Rs 14,405.32.

Cash Flow from Investing Activities

The company continues to make significant investments in its infrastructure, with capital expenditure on property and equipment amounting to Rs 18,770.58 in 2024, slightly higher than Rs 17,385.68 in 2023. There were no major asset sales, resulting in a net cash outflow of Rs 18,674.15 in 2024, up from Rs 17,125.10 the previous year.

Cash Flow from Financing Activities

Financing activities in 2024 saw a substantial increase in short-term borrowings of Rs 31,187.96, offsetting the repayment of long-term borrowings (Rs 7,755.01) and higher finance costs (Rs 16,147.96). The company managed a net cash inflow from financing of Rs 7,264.32, a significant improvement over the Rs 2,995.12 recorded in 2023.

 Financial Ratios of The Bormah Jan Tea Company  

Here is a summary of the financial and operational metrics for The Bormah Jan Tea Company   for the year 2024 and 2023:

Current Ratio

The current ratio measures a company's ability to cover its short-term liabilities with its short-term assets. A ratio below 1 indicates that the company may struggle to meet its short-term obligations. With a current ratio of 0.37 in 2023-24 (down from 0.39 in the previous year), the company’s liquidity has worsened slightly, indicating that it is less capable of covering its current liabilities with available assets, which could signal liquidity issues.

Debt-Equity Ratio

The debt-equity ratio reflects the proportion of debt used to finance the company relative to shareholders' equity. The higher ratio in 2023-24 (1.61) compared to the previous year (1.24) indicates that the company is relying more on debt financing, which increases financial risk. A high debt-equity ratio suggests that the company has more debt than equity, making it more vulnerable to financial distress, especially in the face of earnings volatility.

Debt Service Coverage Ratio (DSCR)

The DSCR measures the company’s ability to generate enough cash to cover its debt-related obligations, such as interest and principal repayments. A DSCR of less than 1 indicates that the company is not generating sufficient cash flow to meet its debt obligations. The sharp drop from 0.62 to 0.09 in 2023-24 suggests that the company's ability to service its debt has significantly deteriorated, putting it at higher risk of defaulting on its financial commitments.

Return on Equity (ROE)

The ROE measures how efficiently a company is using its shareholders' equity to generate profits. A negative ROE of -16.24% in 2023-24 indicates that the company is experiencing losses, eroding shareholder value. This is a sharp decline from the positive ROE of 1.52% in 2022-23, which suggests that the company’s performance has worsened drastically, likely due to increased expenses or declining revenues.

Inventory Turnover Ratio

The inventory turnover ratio shows how efficiently a company is managing its inventory. A lower ratio in 2023-24 (1.78) compared to 2.19 in the previous year suggests that the company is holding onto inventory for longer periods or facing slower sales. This decrease in efficiency can lead to higher storage costs or obsolescence, indicating potential issues in demand or inventory management.

Trade Receivables Turnover Ratio

The trade receivables turnover ratio measures how efficiently the company is collecting its receivables. A dramatic increase in this ratio from 1,141.91 to 4,674.91 indicates that the company is collecting its receivables much faster in 2023-24. This could be a result of tighter credit policies or improved collections management, which is a positive sign for liquidity.

Net Capital Turnover Ratio

The net capital turnover ratio measures how effectively a company is using its working capital to generate revenue. A negative ratio suggests that the company is experiencing inefficiencies in managing its working capital. Although the ratio improved slightly from -1.79 to -1.31 in 2023-24, it still indicates that the company is struggling to utilize its working capital effectively, leading to poor operational efficiency.

Net Profit Ratio

The net profit ratio shows how much of each rupee of revenue is converted into profit. A negative ratio of -8.73% in 2023-24, down from 0.78% in the previous year, indicates that the company is incurring losses for each unit of sales. This sharp decline points to deteriorating profitability, likely driven by increasing costs, declining revenues, or both.

Return on Capital Employed (ROCE)

The ROCE measures the company's efficiency in generating returns from its total capital (debt and equity). The negative ROCE in 2023-24 (-2.12%) versus the positive 5.27% in 2022-23 shows that the company is not generating sufficient returns to cover the cost of capital. This indicates poor performance in the use of both equity and debt to generate profits.