ANALYSIS OF THE FINANCIAL STATEMENTS OF UNITED BREWERIES UNITED BREWERIES PRESENTED BY - AVINASH KAKATI DEBOPRATIM BORAH PUNEET CHOUDHURY RADHAKANTA NAIK SWEETY AGARWALLA VAISHALI GOSWAMI

UNITED BREWERIES GROUP OR UB GROUP  conglomerate of different companies with a major focus on the brewery (beer) and alcoholic beverages industry.  It is owned by Dr. Vijay Mallya.  The company markets beer under the Kingfisher brand.  United Breweries is India's largest producer of beer with a market share of around 48% by volume.  United Breweries now has greater than a 40% share of the Indian brewing market with 79 distilleries and bottling units across the world.

ACCOUNTING POLICY  Basis of Presentation of Financial Statements  Use of Estimates  Revenue Recognition  Borrowing Costs  Fixed Assets  Investments  Inventories ACCOUNTING POLICY

ACCOUNTING POLICY contd.  Foreign Currency Transactions  Depreciation and Amortisation  Employee Retirement benefits  Taxation  Earnings per share  Impairment of Assets  Provisions, Contingent Liabilities and Contingent Assets

BALANCE SHEET

BALANCE SHEET OF UNITED BREWERIES OF 2008, 09, 10 (Rs. In Crores) Sources of Fund Mar ‘10Mar ‘09Mar ‘08 Net worth Total Debt Total Liabilities

BALANCE SHEET(contd.) (Rs. In Crores) Application Of Funds MARCH’10 12 months MARCH’09 12 months MARCH’08 12 months NET BLOCK CAPITAL WORK IN PROGRESS INVESTMENTS TOTAL CA, LOANS & ADVANCES NET CURRENT ASSETS TOTAL ASSETS CONTINGENT LIABILITIES BOOK VALUE(Rs)

PROFIT & LOSS ACCOUNT

PROFIT & LOSS ACCOUNT(In Crores) Income Sales Turnover Less: Excise Duty Net Sales Other Income Stock Adjustments Total Income Expenditure Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Admin Expenses Miscellaneous Expenses Preoperative Exp Capitalised0.00 Total Expenses MARCH’10MARCH’09MARCH’08

PROFIT & LOSS ACCOUNT (Contd.) Operating Profit PBDIT Interest PBDT Depreciation Other Written Off0.00 Profit Before Tax Extra-ordinary items PBT (Post Extra-ordinary Items) Tax Reported Net Profit Total Value Addition Preference Dividend7.41 Equity Dividend Corporate Dividend Tax Per share data (annualised) Shares in issue (lakhs) Earnings Per Share (Rs) Equity Dividend (%) Book Value (Rs) MARCH’10MARCH’09MARCH’08

CASH FLOW(In Crores) MARCH’11MARCH’10MARCH’09 Net Profit Before Tax Net Cash From Operating Activities Net Cash (used in)/from Investing Activities Net Cash (used in)/from Financing Activities Net (decrease)/increase In Cash and Cash Equivalents Opening Cash & Cash Equivalents Closing Cash & Cash Equivalents

RATIO ANALYSIS

EXPLANATION OF FINANCIAL RATIOS  Current ratio Computation= Current assets, loans and advances + short-term investments Current liabilities + Provisions + Short-term Debt  Quick ratio Computation= Current assets, loans and advances – Inventories + short-term investments Current liabilities + Provisions + Short-term Debt Net of working capital limits

CURRENT RATIO: YEAR CURRENT RATIO QUICK RATIO: YEAR LIQUID RATIO

 Debt equity Computation= Long-term Debt Total Net Worth (Equity Shareholders Funds) + Preference Capital  Interest Cover Computation = PAT + Interest on Long-term debt + Non-cash Charges Interest on long-term debt

DEBT-EQUITY RATIO: YEAR DEBT- EQUITY RATIO INTEREST COVER : YEAR INTEREST COVER

 Return on Net Worth Computation = (PAT – Preference Dividend) x 100 Equity shareholder’s funds or Net Worth (equity capital + reserves & surplus - miscellaneous expenditure not written off)  Return on Capital Employed

YEAR RETURN ON NET WORTH RETURN ON NET WORTH: Year ROCE ROCE

 EARNINGS PER SHARE Computation = PAT – preference dividend Weighted number of equity shares outstanding Year E.P.S

HORIZONTAL ANALYSIS OF UNITED BREWERIES Balance Sheet Base Year 2007  Total assets / liabilities up by 9.93% in 2008 from the base year, 64.24% in 2009 and 77.12% increase in 2010 from the base year.  Net Worth up by 9.62% in 2008 from the base year, 93.95% in 2009 from the base year and % in 2010 as against lower growth in loan fund of 29.44% in 2009 from the base year and 40.99% in  Net fixed assets (net block) up by 35.47% in 2008 from the base year, 68.74% in 2009 from the base year and 88.82% in 2010 from the base year. Utilization of fixed assets is not very efficient.  Inventories up by 4.06% in 2008 from the base year, 45.11% in 2009 from the base year and 74.46% in 2010 from the base year. As against increase in net sales by 30.99% in 2008, % in 2009 from the base year and 89.85% in 2010 from the base year. Thus we can say that inventory management is somewhat efficient.  Current liabilities up by 13.66% in 2008 from the base year, 7.63% in 2009 from the base year and 64.15% in 2010 from the base year. Growth of current liabilities is lower than rise in raw materials cost. Maybe the company is paying its suppliers faster to avail cash discounts.  Strong financial position as the company has huge reserves.

Profit And Loss Account Base year 2007 Net sales: 30.99% increase in 2008, % increase in 2009 from the base year and 89.85% increase in 2010 from the base year. Employee cost: 15.88% increase in 2008, 30.29% increase in 2009 from the base year and 48.02% increase in 2010 from the base year. Selling & Administration Costs: 35.11% increase in 2008, 72.14% increase in 2009 from the base year and % increase in 2010 from the base year. Total Expenses: 30.28% increase in 2008, 61.44% increase in 2009 from the base year and 93.90% increase in 2010 from the base year. Raw Material Cost: 32.61% increase in 2008, 69.35% increase in 2009 from the base year and 99.66% increase in 2010 from the base year. Interest: % increase in 2008, % increase in 2009 from the base year and 98.36% increase in 2010 from the base year. Depreciation: 58.87% increase in 2008, 97.77% increase in 2009 from the base year and % increase in 2010 from the base year. Other Income: -3.89% increase in 2008, 45.64% increase in 2009 from the base year and % increase in 2010 from the base year.

Profit And Loss Account (CONTD.) Operating Profit: 24.27% increase in 2008, 56.35% increase in 2009 from the base year and 55.61% increase in 2010 from the base year. PBDIT: 20.92% increase in 2008, 55.08% increase in 2009 from the base year and 80.64% increase in 2010 from the base year. PBDT: 14.94% increase in 2008, 30.66% increase in 2009 from the base year and 76.89% increase in 2010 from the base year. Reported Net Profit: -4.03% increase in 2008, -3.99% increase in 2009 from the base year and 48.98% increase in 2010 from the base year.

comparative growth in net sales, raw material cost & employee cost over the years.

ComparisioN of net worth and loan fund

CompArision of inventories and net worth

-THE KING OF GOOD TIMES THANK YOU