Transline Technologies Annual Reports, Balance Sheet and Financials

Transline Technologies Limited Ltd Balance Sheet (Rs in Lakhs)

 Transline Technologies Limited Ltd Profit & Loss Statement (Rs in Lakhs)

 Transline Technologies Limited Ltd Consolidated 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

Operating activities reflect the core business operations, including the cash impact of revenues and expenses.

Net Profit before Tax: The company reported a significant increase in net profit before tax (Rs. 1,229.94 lakhs for FY 2023 compared to Rs. 81.16 lakhs for FY 2022), signaling improved profitability.

Adjustments for Non-Cash Items: Non-cash adjustments like depreciation and amortization (Rs. 96.27 lakhs in FY 2023, down from Rs. 114.31 lakhs in FY 2022), provision for doubtful debts (Rs. 32.13 lakhs), and interest/financial expenses (Rs. 134.48 lakhs) were added back to profit to reflect the cash impact. These adjustments help align net income with actual cash flow, as they account for non-cash charges.

Working Capital Changes: A significant cash outflow occurred in working capital, primarily driven by an increase in trade receivables (Rs. -2,042.84 lakhs in FY 2023), which indicates that the company extended more credit to customers or faced delays in payments. Additionally, inventories increased by Rs. -712.64 lakhs, implying the company stocked more goods than it sold. Conversely, trade payables increased by Rs. 845.71 lakhs, suggesting that the company delayed some payments to suppliers, which helped conserve cash.

Net Cash from Operating Activities: Overall, the cash generated from operations turned negative (Rs. -260.51 lakhs in FY 2023), largely due to working capital changes, despite the positive operating profit before working capital adjustments. This is a concerning sign as it means the company was not able to generate cash from its core business activities in FY 2023. However, it did report a positive cash flow from operating activities in FY 2022 (Rs. 286.34 lakhs).

Cash Flow from Investing Activities

Investing activities reflect the cash used in or generated from the acquisition and disposal of long-term assets.

Capital Expenditure (Capex): The company spent Rs. -252.46 lakhs on purchasing property, plant, and equipment (PPE), which is a normal business activity reflecting growth or maintenance of fixed assets.

Investments: There was a significant inflow of Rs. 420.00 lakhs from non-current investments in FY 2023 (compared to an outflow of Rs. -400.00 lakhs in FY 2022), suggesting the company made or sold some long-term investments during the year.

Net Cash from Investing Activities: The net result from investing activities was a positive Rs. 168.48 lakhs in FY 2023, compared to a negative Rs. -431.33 lakhs in FY 2022. The change is mainly due to the higher inflows from non-current investments, partially offsetting the capex outflow. This shift indicates that the company may have received proceeds from asset disposals or investments, improving cash flow.

Cash Flow from Financing Activities

Financing activities relate to cash flows from the company’s equity and debt transactions, including borrowing and repaying loans.

Borrowings: There was an increase in short-term borrowings (Rs. 306.50 lakhs), likely indicating the company took on more short-term debt, possibly to cover working capital needs or other cash shortfalls. On the other hand, long-term borrowings decreased by Rs. -256.52 lakhs, which could reflect repayments of long-term debt.

Interest Payments: The company paid Rs. -134.48 lakhs in interest/financial charges, which represents the cash outflows related to the financing costs of existing borrowings.

Net Cash from Financing Activities: The net cash flow from financing activities was negative (Rs. -84.50 lakhs in FY 2023), compared to a larger negative outflow (Rs. -293.86 lakhs in FY 2022). This indicates that, despite the increase in short-term borrowings, the company still experienced a cash outflow from financing activities due to interest payments and debt repayments.

The Net Change in Cash for FY 2023 was negative Rs. -176.53 lakhs, meaning the company experienced a reduction in cash and cash equivalents during the year.

Beginning Cash Balance: The company started the year with Rs. 535.84 lakhs in cash and cash equivalents.

Ending Cash Balance: By the end of the year, cash and cash equivalents decreased to Rs. 359.31 lakhs, reflecting a net reduction in liquidity.

Financial Ratios of Transline Technologies And Produce Home Finance Limited

Here is a summary of the financial and operational metrics for Transline Technologies Limited Ltd for the year 2022 & 2023:

Current Ratio (1.62 in 2023 vs 1.73 in 2022)

The current ratio measures the company’s ability to cover its short-term liabilities with its short-term assets. A ratio of 1.62 in 2023 means the company has Rs. 1.62 in current assets for every Rs. 1 of current liabilities, indicating reasonable liquidity. However, the decline from 1.73 in 2022 suggests a slight reduction in liquidity and may indicate tighter short-term financial flexibility.

Debt-Equity Ratio (0.64 in 2023 vs 0.32 in 2022)

The debt-equity ratio measures the proportion of debt used to finance the company’s assets relative to equity. A ratio of 0.64 in 2023 indicates that for every Rs. 1 of equity, the company has Rs. 0.64 in debt. The increase from 0.32 in 2022 reflects greater leverage, which could amplify both returns and risks. This higher ratio may signal increased financial risk due to more debt reliance.

Debt Service Coverage Ratio (2.12 in 2023 vs 0.41 in 2022)

The debt service coverage ratio (DSCR) indicates the company’s ability to cover its debt obligations (interest + principal) with its operating cash flow. A ratio of 2.12 in 2023 means the company generates more than twice the cash needed to meet its debt payments, which is a positive sign of financial health. The significant increase from 0.41 in 2022 suggests a major improvement in the company’s capacity to service debt.

Return on Equity (48.89% in 2023 vs 4.09% in 2022)

Return on equity (ROE) measures the profitability relative to shareholders' equity. An ROE of 48.89% in 2023 shows strong profitability, meaning the company is generating Rs. 48.89 for every Rs. 100 of equity invested. The sharp rise from 4.09% in 2022 reflects significant improvements in profitability, although it could also be influenced by higher debt levels.

Inventory Turnover Ratio (12.02 in 2023 vs 10.45 in 2022)

The inventory turnover ratio shows how many times the company sells and replaces its inventory during a period. A ratio of 12.02 in 2023 suggests that the company is more efficient at managing and selling its inventory compared to the previous year (10.45). This improvement indicates better inventory management or faster sales cycles.

Trade Receivables Turnover Ratio (2.75 in 2023 vs 1.18 in 2022)

The receivables turnover ratio measures how efficiently the company collects its receivables. A ratio of 2.75 in 2023 means the company collects its average receivables almost 2.75 times per year, up from 1.18 in 2022. The improvement suggests faster collection of payments from customers and better management of receivables.

Trade Payables Turnover Ratio (3.46 in 2023 vs 1.63 in 2022)

The payables turnover ratio shows how quickly the company pays its suppliers. A ratio of 3.46 in 2023 indicates that the company is paying its suppliers more quickly than in 2022 (1.63). This increase may reflect an effort to maintain strong supplier relationships or a shift toward faster payment terms, but it could also indicate tighter liquidity.

Net Capital Turnover Ratio (0.21 in 2023 vs 1.84 in 2022)

The net capital turnover ratio measures the company’s efficiency in generating revenue from its capital base (equity + debt). The sharp drop from 1.84 in 2022 to 0.21 in 2023 indicates that the company is generating significantly less revenue for each unit of capital employed. This could suggest inefficiency or slower growth relative to its capital base.

Net Profit Ratio (8.80% in 2023 vs 1.46% in 2022)

The net profit ratio shows the percentage of revenue that translates into profit. An increase to 8.80% in 2023 from 1.46% in 2022 indicates a substantial improvement in profitability. The company is now converting a much higher proportion of its sales into net profit, reflecting better cost control and operational efficiency.

Return on Capital Employed (35.67% in 2023 vs 4.96% in 2022)

Return on capital employed (ROCE) measures the profitability relative to the total capital invested in the business (both debt and equity). A ratio of 35.67% in 2023 shows that the company is efficiently using its capital to generate profits, a significant improvement from 4.96% in 2022. This reflects stronger operational performance and better capital utilization.