CIPLA reported a loss in 2020, with revenue of Ushs 192.7 billion and a net loss of Ushs 23.1 billion. This is a decline from 2019 where they had revenue of Ushs 195.1 billion and a net profit of Ushs 6.8 billion. UMEME's revenue declined slightly from Ushs 1.78 trillion in 2019 to Ushs 1.66 trillion in 2020, and their net profit also declined from Ushs 139 billion to Ushs 43 billion over the same period. Both companies saw declines in key profitability ratios like gross profit margin and net profit margin from 2019 to 2020.
CIPLA reported a loss in 2020, with revenue of Ushs 192.7 billion and a net loss of Ushs 23.1 billion. This is a decline from 2019 where they had revenue of Ushs 195.1 billion and a net profit of Ushs 6.8 billion. UMEME's revenue declined slightly from Ushs 1.78 trillion in 2019 to Ushs 1.66 trillion in 2020, and their net profit also declined from Ushs 139 billion to Ushs 43 billion over the same period. Both companies saw declines in key profitability ratios like gross profit margin and net profit margin from 2019 to 2020.
CIPLA reported a loss in 2020, with revenue of Ushs 192.7 billion and a net loss of Ushs 23.1 billion. This is a decline from 2019 where they had revenue of Ushs 195.1 billion and a net profit of Ushs 6.8 billion. UMEME's revenue declined slightly from Ushs 1.78 trillion in 2019 to Ushs 1.66 trillion in 2020, and their net profit also declined from Ushs 139 billion to Ushs 43 billion over the same period. Both companies saw declines in key profitability ratios like gross profit margin and net profit margin from 2019 to 2020.
CIPLA reported a loss in 2020, with revenue of Ushs 192.7 billion and a net loss of Ushs 23.1 billion. This is a decline from 2019 where they had revenue of Ushs 195.1 billion and a net profit of Ushs 6.8 billion. UMEME's revenue declined slightly from Ushs 1.78 trillion in 2019 to Ushs 1.66 trillion in 2020, and their net profit also declined from Ushs 139 billion to Ushs 43 billion over the same period. Both companies saw declines in key profitability ratios like gross profit margin and net profit margin from 2019 to 2020.
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CIPLA STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME 2020 2019 Ushs'000' Ushs'000 Revenue 192,681,692 195,136,338 Cost of sales 155,736,503 141,646,451 Gross profit 36,945,189 53,489,887
Other income 38,507 187,538 General and administrative expenses 36,617,171 40,923,582 Impairement allowance on financial assets 32,169,969 3,041,727 operating (loss)/ profit (31,803,444) 9,712,116 finance costs and finance income-net 3,928,097 2,584,096 (Loss)/ profit before tax 35,731,541 7,128,020 income tax credit/(expense) 12,658,678 342,287 (loss)/profit for the year (23,072,863) 6,785,733 other comprehensive income - - total comprehensive (loss)/income for the year 23,072,863 6,785,733 basic and diluted (loss)/ earnings per share 6.32 1.86 CIPLA QUALITY CHEMICAL INDUSTRIES LIMITED ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2020 STATEMENT OF FINANCIAL POSITION Assets non-current assets Property,Plant, Equipment and right of use assets 54,189,768 27,859,821 Capital Work-In-progress 19,279,748 33,550,933 Leasehold property - 2,776,233 intangible assets 1,358,075 1,738,132 Deferred tax asset 10,501,984 -
85,329,575 65,925,119 current assets inventories 70,725,283 81,221,162 trade and other receivables 87,577,600 140,037,976 current tax receivables 758,584 - cash on hand and at bank 4,075,600 714,329
163,137,067 221,973,467 total assets 248,466,642 287,898,586 equity and liabilities equity issued capital 45,648,865 45,648,865 capital grant 2,275,000 2,275,000 retained earnings 97,313,531 120,386,394
145,237,396 168,310,259 liabilities non-current liabilities deferred tax liability - 2,156,694 lease liabilities 406,695 - 406,695 2,156,694 current liabilities lease liabilities 289,725 - trade and other payables 55,457,879 65,512,755 bank overdraft 47,074,947 51,918,878
102,822,551 117,431,633 total liabilities 103,229,246 119,588,327 total equity and liabilities 248,466,642 287,898,586 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2020 STATEMENT OF COMPREHENSIVE INCOME
UMEME STATEMENT OF PROFIT OR LOSS
Revenue from contracts with customers 1,660,841 1,776,597
cost of sales 1,181,852 1,182,497 gross profit 478,989 594,100 repair and maintenance expenses 45,744 30,911 administration expense 179,945 182,982 foreign exchange losses 11,413 7,782 increase in expected credit losses 7,614 3,860 profit before amortization, impairment, interest and tax 234,273 368,565 amortization and write off of intangible assets 141,275 122,994 operating profit 92,998 245,571 finance income 18,913 17,639 finance costs 48,950 58,853 profit before tax 62,961 204,357 income tax expense 19,880 65,205 profit for the year 43,081 139,152 basic and diluted earnings per share 27 86 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2020 STATEMENT OF FINANCIAL POSITION
assets non-current assets intangible assets 787,665 808,631 other financial assets 1,016,856 855,497 concession financial asset 329,283 327,570 2,133,804 1,991,698 current assets inventories 102,600 69,778 contract assets 91,433 85,215 current income tax recoverable 41,137 11,077 trade and other receivables 218,402 216,309 prepayments 47,642 68,501 bank balances 30,022 99,196 531,236 550,076 total assets 2,665,040 2,541,774 equity and liabilities equity issued capital 27,748 27,748 share premium 70,292 70,292 retained earnings 521,980 546,030 translation reserve 183,186 189,450 803,206 833,520 non current liabilities borrowings; noncurrent portion 341,464 428,457 concession obligation 329,283 327,570 long term incentive plan 58 866 deferred tax liability 215,313 195,455 886,118 952,348 current liabilities borrowings current portion 175,640 128,477 customer securty deposits 496 492 contract liabiliyies 139,866 138,095 accrued expenses 53,931 15,704 provisions 1,311 1,318 trade and other payables 522,457 425,480 bank overdrafts 82,015 46,340 975,716 755,906 1,861,834 1,708,254 total equity and liabilities 2,665,040 2,541,774 INCOME STATEMENT RATIOS Profitability ratio for CIPLA Gross Profit Total Sales 36,945,189 2020= 192681692 =0.191742083x100 = 19% 53,489,887 2019= 195,136,338 =0.27411546x100 = 27% Gross profit margin ratio for UMEME 478,989 2020= 1,660,841 =0.288401479x100 =28% 594,100 2019= 1,776,597
=0.334403357x100=33% From the analysis, one can easily discover that there was decline in the gross profit margin from 27% in 2020 to 19% in 2019 for CIPLA and this was contrary to that of UMEME which had a slight decline in the gross profit margin from 33% to 28% in 2019 and 2020 respectively. This does not show a better improvement in the companies’ gross earnings in 2020.
NET PROFIT MARGIN RATIO
FOR CIPLA Net Profit Total Sales (23,072,863) 2020= 192,681,692
0.034774318x100=3% NET PROFIT MARGIN RATIO FOR UMEME 43,081 2020= 1,660,841 0.025939268x100=2% 139,152 2019= 1,776,597
0.078325023 X100=7%
The net profit margin reveals that there has been a decrease from 2019- 2020 3%,-11% for CIPLA and 7%, 2% for UMEME These show that the company would be in an a hard situation not to survive in the face of falling selling prices, rising cost of production and declining demand for the company's products.
RETURN ON ASSETS RATIO
UMEME 43,081 2020= 2,665,040
0.016165236 139,152 2019= 2,541,774
0.054746016
BALANCE SHEET RATIO
Current Ratio FOR CIPLA Total Current Assets Total Current Liabilities 163,137,067 2020= 102,822,551
1.586588403 or 1.6 times
221,973,467 2019= 117,431,633 1.890235717 Or 1.9 times
Current Ratio FOR UMEME
531,236 2020= 975,716
0.544457609 times 550,076 2019= 755,906
0.727704238 times The current ratio is the classic measure of liquidity. It indicates whether the business can pay debts due within one year out of the current assets. ... A low current ratio (say less than 1.0-1.5 might suggest that the business is not well placed to pay its debts
Therefore since we have 1.6 and 1.9 for CIPLA in 2020 and 2019 respectively, it therefore means that the company can favorably pay off its current debts using its assets available which contrary to its counterpart (UMEME) with only 0.5 and 0.7 respectively for the two years which suggests that the company has got no ability to pay off its debts well. DEBT TO WORTH RATIO FOR CIPLA Total Liabilities (or Debt) Net Worth (or Total Equity) 103,229,246 2020= 145,237,396
0.710762165 times 119,588,327 2019= 168,310,259
0.7105231times
975,716 2020= 803,206
DEBT TO WORTH RATIO FOR
UMEME
0.823196504 755,906 2019= 833,520
0.906884058
Debt-to-net worth ratio = total debts / net worth the lower the ratio, the healthier you'll appear to anyone assessing your ratio. A low number suggests minimal debt for CIPLA (70%) (70%) means that there is poor financial performance. However this was still worse on the second company UMEME whereby 80% and 90% in 2020 and 2019 respectively.
