Gujarat Hotels Ltd. :507960-IN: Earnings Analysis: 2017 By the Numbers : July 24, 2017

Gujarat Hotels Ltd. reports financial results for the year ended March 31, 2017.

Highlights

  • Change in operating cash flow of 13.10% compared to same period last year is about the same as change in earnings, likely no significant movement in accruals or reserves.
  • Earnings growth due to contribution of one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

2017 2016 2015 2014 2013
Relevant Numbers (Annual)
Revenues 32.51 34.85 32.04 29.96 33.51
Revenue Growth (YOY) N/A N/A N/A N/A N/A
Earnings 38.65 32.54 27.34 32.71 33.44
Earnings Growth (YOY) 18.76 19.04 -16.43 -2.17 9.87
Net Margin 118.87 93.38 85.32 109.18 99.79
EPS 10.2 8.59 7.22 8.64 8.83
Return on Equity 16.26 15.72 13.88 17.9 20.25
Return on Assets 14.66 13.69 12.05 15.48 17.35

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Cash Versus Earnings – Sustainable Performance?

It is important to examine a company�s cash versus earnings numbers to gauge whether its performance is sustainable.

507960-IN‘s year-on-year change in operating cash flow of 13.10% is around its change in earnings. This suggests that there are likely no significant movement in accruals or reserves for managing earnings this period.

Margins

The company’s operating (EBIT) margins contracted from 87.98% to 87.91%. In spite of this, the company’s earnings rose. This was influenced primarily by one-time items, which improved pretax margins from 105.14% to 145.32%.

EBIT Margin History
PreTax Margin History

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Company Profile

Gujarat Hotels Ltd. owns and operates hotels. The company owns the WelcomHotel Vadodara in Vadodara which is operated by ITC Ltd. It operates through single segment: Hoteliering. Gujarat Hotels was founded on August 7, 1982 and is headquartered in Vadodara, India.

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