Standalone cash Flow
- Increase in net cash generated from operations reflects profit in Fiscal 2016. The cash generated in operations before working capital changes was Rs. 2,688.46 crores in Fiscal 2016 compared to cash used in operations of Rs. 619.59 crores in Fiscal 2015. There was a net outflow of Rs. 373.29 crores in Fiscal 2016 towards working capital changes mainly attributable to the increase in trade receivables and inventories.
- The net cash used in investing activity was Rs. 2,925.96 crores in Fiscal 2016 compared to a cash inflow of Rs. 253.37 crores in Fiscal 2015, mainly attributable to:
- Inflow by way of divestments in subsidiary companies resulting in cash inflow of Rs. 746.90 crores in Fiscal 2016 compared to Rs. 1,803.90 crores in Fiscal 2015.
- Inflow due to dividends and interest was Rs. 1,289.61 crores in Fiscal 2016 compared to Rs. 1,778.61 crores in Fiscal 2015;
- Investment in Mutual fund (net) during Fiscal 2016 was Rs. 1,668.51 crores.
- The cash used for payments for fixed assets was Rs. 2,981.98 crores (net) in Fiscal 2016 compared to Rs. 3,054.79 crores in Fiscal 2015; and
- There was an outflow (net) of Rs. 211.06 crores in Fiscal 2015 compared to Rs. 295.64 crores for Fiscal 2015 towards investments in subsidiary, joint ventures and associates companies.
- The net change in financing activity was an outflow of Rs. 71.14 crores in Fiscal 2016 against inflow of Rs. 2,631.53 crores in Fiscal 2015. The inflow is attributable to the following:
- During Fiscal 2016, the Company raised Rs. 7,433.22 crores through rights issue of shares.
- Long-term borrowings (net) – outflow of Rs. 1,120.48 crores in Fiscal 2016 as compared inflow of Rs. 2,227.38 crores to Fiscal 2015; and
- Short-term borrowings – net outflow of Rs. 1,838.66 crores in Fiscal 2016 compared to outflow of Rs. 1,665.12 crores in Fiscal 2015.
- Net change in other short-term borrowing – net outflow of Rs. 2,529.60 crores in Fiscal 2016 compared to inflow of Rs. 4,620.20 crores in Fiscal 2015.
FINANCIAL PERFORMANCE OF JAGUAR LAND ROVER (AS PER IFRS)
The financial statements of Jaguar Land Rover are prepared in accordance with International Financial Reporting Standards (IFRS) applicable in the United Kingdom. This information is given to enable the readers to understand the performance of Jaguar Land Rover [on a consolidated basis for the Jaguar Land Rover group]
Revenues for Jaguar Land Rover for Fiscal 2016 were GB£22,208 million, an increase of 1.6% compared to GB£21,866 million in Fiscal 2015, driven primarily by increased wholesale volumes and offset by a less favourable market and market mix.
Material and other cost of sales in Fiscal 2016 remained flat at GB£13,303 million compared to GB£13,185 million in Fiscal 2015. the increase is mainly due to exceptional charge realting to vehicle destroyed or damaged in the Tianjin port explosion in August 2015. As a proportion of revenue, it decreases to 59.9% as compared to 60.3% in Fiscal 2015, driven by cost reduction measures and a generally weaker Euro in Fiscal 2016.
Employee costs increased by 17.4% to GB£2,321 million in Fiscal 2016 as compared to GB£1,977 million in Fiscal 2015, primarily reflecting, increased headcount required to support the increase production volumes.
Other expenses (net of income) increased by 14.6% to GB£4,546 million in Fiscal 2016 compared to GB£3,966 million in Fiscal 2015, primarily reflecting, higher costs related to freight and distribution, warranty selling and fixed marketing expense, launch costs and GB£166 million of one-time reserves and charges for the US recall of potentially faulty passenger airbags supplied by Takata, doubtful debts and previously capitalized investment.
Product development costs capitalised increased by 7.3% to GB£1,242 million in Fiscal 2016 compared to GB£1,158 million in Fiscal 2015, due to increased expenditure on the development of future products and technologies.
Profit before tax ("PBT") decreased by 40.4% to GB£1,557 million in Fiscal 2016 as compared to GB£2,614 million in Fiscal 2015, primarily reflecting the items mentioned above as well as an increase in depreciation and amortization of GB£367 million and an exceptional net charge of GB£157 million related to vehicles destroyed or damaged in the Tianjin port explosion in August 2015. The GB£347 million more favourable revaluation of US Dollar denominated debt and unrealized foreign exchange and commodity derivatives as well as the GB£35 million lower interest expense (net) in Fiscal 2016 compared to Fiscal 2015 partially offset the unfavourable factors impacting PBT described above. In addition, the profit of GB£64 million primarily earned this fiscal year primarily by Jaguar Land Rover's China Joint Venture (compared to a loss of GB£6 million in Fiscal 2015) also helped support the solid PBT in Fiscal 2016.
Consequently, the Profit after tax ("PAT") decreased by 35.6% to GB£1,312 million in Fiscal 2016 compared to GB£2,038 million in Fiscal 2015. However, the effective tax rate of 16% in Fiscal 2016 was notably lower than the 22% in Fiscal 2015 due to a GB£74 million deferred tax credit resulting from tax deductions available under the UK's Patent Box tax legislation and a favourable one-time deferred tax credit of GB£63 million arising as a result of enacted future reductions in the rate of UK Corporation Tax (from 20% to 19% for Fiscal 2018 – Fiscal 2020 and 18% thereafter).
Cash Flow: Net cash from operating activities was GB£3,560 million in Fiscal 2016. The strong cash flow was driven by solid profitability and positive working capital and non-cash accruals of GB£579 million (negative working capital and non-cash accruals of GB£116 million in Fiscal 2015). After GB£166 million of tax paid in Fiscal 2016, GB£2,817 million of investment spending (excluding GB£318 million of R&D expensed through the income statement) and GB£48 million of other income (primarily interest received) free cash flow before financing was GB£791 million. A GB£111 million reduction in debt primarily reflects the redemption of the remaining GB£ 8.25% notes due 2020 (GB£58 million) and the lower utilization of the invoice discounting facility (GB£40 million) whilst the GB£142 million finance expenses and fees primarily relates to interest payments on the outstanding bonds and fees relating to the financing facilities (including the refinanced revolving credit facility). A dividend of GB£150 million was also paid to TML Holdings Pte Ltd, Sigapore in June 2015. As at March 31, 2016, Jaguar Land Rover had a total cash balance of GB£4,651 million (comprised of GB£3,399 million of cash and cash equivalents and GB£1,252 million of financial deposits) compared to GB£4,263 million of total cash as at March 31, 2015 (comprised of GB£3,208 million of cash and cash equivalents and GB£1,055 million of financial deposits). With total cash of GB£4,651 million and an undrawn revolving credit facility of GB£1,870 million, total liquidity at Jaguar Land Rover was GB£6,521 million as at March 31, 2016, compared to GB£5,748 million as at March 31, 2015.
Financial performance of TMFL (Consolidated)
During Fiscal 2016, TMFL earned a total income of Rs. 2,967.73 crores compared to Rs. 2,742.88 crores earned in Fiscal 2015, reflecting an increase of 8.2%, primarily due to increase in the commercial vehicle segment, improvement due to discontinuation of Low Down Payment (LDP) schemes, improved market conditions and highly focused collection efforts. The expansion of spoke branches (Tier 2 and 3 towns) has helped in reaching out to the customer more quickly and in improving customer satisfaction. The profit before tax was Rs. 301.64 crores in Fiscal 2016 as compared to loss of Rs. 845.01 crores in Fiscal 2015. The profit after tax was Rs. 267.03 crores in Fiscal 2016, as compared to a loss of Rs. 611.16 crores in the previous year.
Financial performance of TDCV (as per Korean GAAP)
In Fiscal 2015, TDCV's total revenue declined by 11.0% to KRW 879.66 billion (Rs. 5,096.46 crores) compared to KRW 987.95 billion (Rs. 5,563.03 crores) in Fiscal 2015, mainly due to lower export sales partially offset by increase in domestic sales. The profit after tax was KRW 45.56 Billion (Rs. 263.96 crores) compared to KRW 54.00 Billion (Rs. 304.09 crore) of previous year which included one-time reversal of provisions pertaining to ordinary wage lawsuit KRW 24.20 Billion (Rs. 136.27 crores). Better profitability of Euro 6 vehicles, better mix, favorable exchange realizations, continuous material cost reduction, various cost control and inventory initiatives helped in improving profits.
Financial performance of TTL
The consolidated revenue of TTL in Fiscal 2016 increased 2.6% to Rs. 2,713.60 crores compared to Rs. 2,644.23 crores in Fiscal 2015. The profit before tax increased 7.2% to Rs. 460.89 crores in Fiscal 2016 compared to Rs. 429.76 crores in Fiscal 2015. The profit after tax increased by 14.2% to Rs. 381.66 crores in Fiscal 2016 compared to Rs. 334.07 crores in Fiscal 2015.