CHEMANEX PLC FINANCIAL STATEMENTS FOR NINE MONTHS ENDED

Transcription

1 FINANCIAL STATEMENTS FOR NINE MONTHS ENDED 31ST DECEMBER 2017

2 Corporate Information Name of the Legal Form Chemanex PLC A Public Quoted with Limited Liability Under the provisions of Companies Act No 7 of 2007 Registered Office P. O. Box 188, 52, Galle Face Court 2, Colombo-3. Date of Incorporation 28 th August 1974 Registration Number PQ 64 Directors S H Amarasekera Chairman S P S Ranatunga A V P Silva S A B Ekanayake P R Saldin L N D S Wijeyeratne Secretary Auditors Legal Advisers Subsidiary Companies Bankers T Wegodapola Ernst & Young Chartered Accountants 201, De Saram Place Colombo 10. Nithya Partners Attorneys-at - Law 51, Gregorys Road, Colombo 7. CAL Exports Lanka (Pvt) Limited Chemanex Exports (Pvt) Limited Chemcel (Pvt) Limited Yasui Lanka (Pvt) Limited (Under Liquidation) Commercial Bank of Ceylon PLC Standard Chartered Bank Hatton National Bank PLC National Development Bank PLC

3 STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME Quarter ended 31 st December Nine months ended 31 st December Variance % Variance % (In Rs. '000) Note Revenue 1 262, ,405 (27) 863,687 1,002,375 (14) Cost of sales (214,779) (294,530) (27) (694,340) (808,041) (14) Gross profit 48,075 67,875 (29) 169, ,334 (13) Other income ,329 (100) 53, ,446 (67) Net finance (expenses)/income 3 9,160 (6,123) (250) 28,048 (15,203) 284 Administrative expenses (151,497) (22,339) 578 (208,099) (62,810) 231 Distribution expenses (29,854) (57,720) (48) (85,217) (96,584) (12) Other expenses 4 (6,849) (727) 842 (8,135) (1,694) 380 Profit/(loss) before tax (130,641) 134,295 (197) (50,671) 178,489 (128) Income tax expense 9,120 (5,625) 262 (4,707) (17,452) (73) Profit/(loss) for the period (121,521) 128,670 (194) (55,378) 161,037 (134) Other comprehensive income Net gain/(loss) in fair value of available for sale financial assets 2,182 (1,771) (223) 2,849 1, Total comprehensive income for the period (119,338) 126,900 (194) (52,529) 162,441 (132) Basic/Diluted earnings per share (Rs.) (7.72) 8.17 (194) (3.52) (134) Figures in brackets indicate deductions. The above figures are provisional and unaudited.

4 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME Quarter ended 31 st December 2017 Nine months ended 31 st December Variance % 2017 Variance % (In Rs. '000) Note Revenue 1 263, ,684 (25) 856, ,510 (14) Cost of sales (215,334) (285,844) (25) (688,083) (805,514) (15) Gross profit 47,666 66,840 (29) 168, ,996 (13) Other income ,993 (95) 50,205 9, Net finance (expenses) /income 3 11,116 (3,595) (409) 34,263 (10,173) 437 Administrative expenses (151,156) (23,324) 548 (209,625) (65,737) 219 Distribution expenses (29,554) (57,706) (49) (84,935) (96,357) (12) Other expenses 4 - (8,747) (100) (1,286) (9,714) (87) Share of profits of equity accounted investees, net of income tax 5 1,940 1, ,091 4, Profit/(loss) before tax (119,618) (17,471) 585 (35,238) 26,557 (233) Income tax expense 8,762 (5,958) (247) (5,757) (18,173) (68) Profit/(loss) after tax from continuing operations (110,856) (23,429) 373 (40,995) 8,384 (589) Profit/(loss) from discontinued operations, net of tax (73,255) (4,239) 1,628 (90,390) 26,332 (443) Comprehensive income for the period (184,111) (27,668) 565 (131,385) 34,716 (478) Other comprehensive income Net gain in fair value of available for sale financial assets 3,305 (1,860) 278 4,474 2, Other comprehensive income for the period, net of tax 3,305 (1,860) 278 4,474 2, Total comprehensive income for the period (180,806) (29,528) 512 (126,911) 37,406 (439) Comprehensive income attributable to : Equity holders of the (162,134) (26,472) 512 (104,267) 28,218 (470) Non-controlling interests (21,977) (1,196) 1,738 (27,118) 6,498 (517) Other comprehensive income attributable to : (184,111) (27,668) 565 (131,385) 34,716 (478) Equity holders of the 3,136 (1,860) 269 4,230 2, Non-controlling interests Basic/Diluted earnings/(deficit) per share from Continuing Operations (Rs.) Basic/Diluted earnings/(deficit) per share (Rs.) 3,305 (1,860) 278 4,474 2, (5.64) (1.41) 300 (0.88) 0.12 (836) (10.29) (1.68) 512 (6.62) 1.79 (470) Figures in brackets indicate deductions. The above figures are provisional and unaudited.

5 STATEMENT OF FINANCIAL POSITION As at 31 st March March (In Rs. '000) Note ASSETS Non-Current Assets Property, plant & equipment 235, , , , , ,412 Investment in subsidiaries 47,173 76,400 76, Investment in equity accounted investees 69,508 69,508 69, , , ,040 Available for sale financial assets-long term 281, , , , , ,578 Deferred tax assets 10,968 11,941 10,580 10,968 14,065 12, , , , , , ,307 Current Assets Inventories 156, , , , , ,623 Trade and other receivables 278, , , , , ,155 Due from related companies 94,410 81,009 85, ,977 1,121 Assets held for sale from discontinued operation 29, , ,580 Equity accounted investees held for distribution Financial assets held for trading 36,976 38,200 31,236 44,457 49,450 42,684 Assets held for sale - 40,247 40,247-40,247 40,247 Cash & cash equivalents 6 531, , , , , ,122 1,127,541 1,130,258 1,174,342 1,371,138 1,374,479 1,419,532 Total Assets 1,772,473 1,740,347 1,849,812 2,055,897 1,985,852 2,099,839 EQUITY AND LIABILITIES Stated capital 126, , , , , ,250 Capital reserves 220, , , , , ,170 Revenue reserves 1,207,120 1,203,844 1,275,399 1,389,651 1,428,323 1,505,438 Equity attributable to equity holders of the parent 1,554,335 1,551,059 1,622,614 1,754,071 1,792,743 1,869,858 Non - controlling interests ,217 40,970 42,507 Non-Current Liabilities 1,554,335 1,551,059 1,622,614 1,768,287 1,833,713 1,912,365 Employee retirement benefit liability 36,830 35,704 33,323 36,829 50,396 44,150 36,830 35,704 33,323 36,829 50,396 44,150 Current Liabilities Trade and other payables 148,468 26,068 60, ,997 39,869 74,594 Income tax payable - 6,387 11, ,418 9,965 Liabilities relating to discontinued operation ,542 1,165 1,508 Due to related companies 32, , ,063 32,840 52,819 57,168 Bank overdrafts - 2, , , , , , , ,324 Total Liabilities 218, , , , , ,474 Total Equity and Liabilities 1,772,473 1,740,347 1,849,812 2,055,897 1,985,852 2,099,839 Net Assets per share - Rs The above figures are provisional and unaudited. It is certified that the Financial Statements have been prepared in accordance with the requirements of the Companies Act No.07 of (Sgd. ) A N Sugathapala Chief Operating Officer The Board of Directors is responsible for the preparation and presentation of these Financial Statements. Signed for and on behalf of the board by; (Sgd.) S H Amarasekera (Sgd.) S P S Ranatunga (Sgd.) T Wegodapola Chairman Director Secretary 01 st February 2018 Colombo

6 STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 31 ST DECEMBER Capital Reserves Revenue Reserves Stated COMPANY Other capital Capital General Available for sale Capital (In Rs. '000) Reserve Reserve Reserve Reserve Retained Earnings Total Equity Balance as at 1 st April , , , , ,769 1,404,368 Profit for the period , ,037 Other comprehensive income Net gain on fair value of available for sale financial assets ,404-1,404 Dividends to shareholders Dividend (2015/16) (15,750) (15,750) Balance as at 31 st December , , , , ,056 1,551,059 Balance as at 1 st April , , , , ,075 1,622,614 Profit for the period (55,378) (55,378) Other comprehensive income Net gain on fair value of available for sale financial assets ,849-2,849 Dividends to Shareholders Dividend (2016/17) (15,750) (15,750) Balance as at 31 st December , , , , ,947 1,554,335

7 STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 31ST DECEMBER GROUP Capital Reserves Revenue Reserves (In Rs. '000) Stated Reserve on Other Available-for- General Retained Capital Revaluation script capital sale reserve earnings reserve issue Reserve Reserve Total Reserves Non Controlling Interest Total Equity Balance as at 1 st April ,250 3, , , ,841 1,032,395 1,777,785 36,611 1,814,396 Profit for the period ,218 28,218 6,498 34,716 Other comprehensive income Net gain on fair value of available for sale financial assets , , ,690 Dividend to shareholders Dividend (2015/16) (15,750) (15,750) - (15,750) Subsidiary dividend to non- controlling interests (2,339) (2,339) Balance as at 31 st December ,250 3, , , ,841 1,044,863 1,792,743 40,970 1,833,713 Balance as at 1 st April ,250 3, , , ,841 1,056,269 1,869,858 42,507 1,912,365 Loss for period (104,267) (104,267) (27,118) (131,385) Other comprehensive income Net gain on fair value of available for sale financial assets , , ,474 Dividend to shareholders Dividend (2016/17) (15,750) (15,750) - (15,750) Subsidiary dividend to non- controlling interests (1,419) (1,419) Balance as at 31 st December ,250 3, , , , ,252 1,754,071 14,217 1,768,286

8 Statement of Cash Flows For the period ended 31 st December Cash Flow from Operating Activities Rs.'000 Rs.'000 Rs.'000 Rs.'000 Profit before taxation (50,671) 178,489 (35,238) 26,557 Profit/ (Loss) from discontinued operations - - (88,745) 29,977 Adjustments for ; (50,671) 178,489 (123,983) 56,534 Depreciation on property, plant & equipment 2,600 2,693 3,063 4,221 Gain on disposal of assets held for sale (49,753) - (49,753) - (Gain)/ loss from capital reduction of assets held for distribution Chemcel (Pvt) Limited - (145,373) - 8,020 Share of profits of equity accounted investees - - (8,091) (4,806) Share of profits of discontinued operations (4,840) (Gain)/ loss on translation of foreign currencies (122) (84) 1,866 2,641 Profit on disposal of investment - (854) - (854) Interest expenses 69 15, ,188 Interest income (27,995) (537) (32,494) (8,259) Dividend income (3,632) (13,512) (563) (8,335) Provision for defined benefit plans 6,405 6,386 8,441 8,929 Operating profit before working capital changes (123,099) 43,031 (201,417) 69,438 Decrease in inventories 134,994 8, ,699 18,388 (Increase)/decrease in trade and other receivables 62,074 (942) 91,858 29,887 Increase/( decrease) in trade and other payables (1,380) 12, ,406 (34,520) Cash generated from/ (used in) operations 72,589 63, ,546 83,194 Interest paid (69) (15,824) (97) (16,188) Income tax paid (12,262) (21,241) (24,800) (25,649) Employment benefit paid (2,898) (4,658) (2,900) (6,115) Net cash inflow from operating activities 57,360 21, ,749 35,242 Cash flow from investing activities Proceeds from disposal of assets held for sale 90,000-90,000 - Proceeds from capital reduction of assets held for distribution Chemcel 417, ,555 Proceeds from disposal of investment - 15,706-15,706 Dividends received from equity accounted investees 3,308 8, Dividends income from non-group companies 324 5, ,335 Interest received 27, ,494 8,259 Acquisition of property, plant & equipment (1,071) (2,744) (3,015) (3,301) Acquisition of investments (2,891) (11,998) (4,778) (11,998) Subsidiary dividend to non-controlling interests - - (1,419) (2,339) Net cash inflow from investing activities 117, , , ,217 Cash flows from financing activities Dividend paid (15,750) (15,750) (15,750) (15,750) Net cash inflow/(outflow) from financing activities (15,750) (15,750) (15,750) (15,750) Net change in cash & cash equivalents 159, , , ,710 Cash & cash equivalents at the beginning of the period 372,424 (125,881) 549,033 34,394 Effect of exchange rate fluctuations (1,866) (2,641) Cash & cash equivalents at the end of the period 531, , , ,463 Analysis of cash & cash equivalents at the end of the period Bank & cash balance 531, , , ,935 Bank overdrafts - (2,472) (1,684) (2,472) 531, , , ,463

9 SEGMENTAL INFORMATION For the nine months ended 31 st December (In Rs. '000) (a) Industry segment revenue Chemicals 509, , , ,074 Paints 277, , , ,977 Consumer 57,122 29,503 57,122 29,503 Rent and service 20,414 22,924 20,414 22, ,687 1,002, ,769 1,011,478 Intra- revenue - - (11,637) (11,968) Total revenue from external customers 863,687 1,002, , ,510 (b) Gross revenue Gross revenue 867,125 1,012, ,453 1,009,113 Less : Nation Building tax (3,438) (9,720) (3,438) (9,720) Freight Commission - - (1,107) (80) Net revenue 863,687 1,002, , ,510 (c) PROFIT BEFORE TAXATION (In Rs. '000) Industry segment Chemicals 8,418 32,433 5,876 29,395 Paints (8,274) (21,964) (8,274) (21,964) Consumer (4,327) 2,464 (4,327) 2,464 Rent and service 20,214 22,007 20,214 22,007 16,031 34,940 13,489 31,902 Unallocated expenses (140,000) - (140,000) - Other income 53, ,446 50,205 9,736 Finance income/(expense) 28,048 (15,203) 34,263 (10,173) Other expenses (8,135) (1,694) (1,286) (9,714) Share of profits of equity accounted investees - 8,091 4,806 (net of income tax) Figures in brackets indicate deductions. The above figures are provisional and unaudited. (50,671) 178,489 (35,238) 26,557

10 Notes to the Financial Statements For the nine months ended 31 st December 2017 (In Rs. '000) Other Income Dividend Income from investments - Quoted Unquoted 3,308 12,718-7,260 Profit on sale of assets held for sale 49,753-49,753 - Gain from capital reduction of assets held for distribution Chemcel (Pvt) Limit - 145, Profit on sale of investment Income from investments in treasury bills , ,446 50,205 9,736 2 Net finance (expenses)/income (In Rs. '000) Interest Income on deposits 27, ,440 3,296 Interest Income on staff loans Gain/(Loss) on foreign currency Financing expenses (Note 3.1) ,866 2,641 (69) (15,824) (97) (16,188) 28,048 (15,203) 34,263 (10,173) 2.1 Financing expenses (In Rs. '000) Interest on short-term loans and overdrafts 69 15, , , ,188 3 Other expenses (In Rs. '000) Expenses incurred on assets held for sale 1,286 1,694 1,286 1,694 Provision for inter company receivable 6, Loss from capital reduction of assets held for distribution Chemcel (Pvt) Limited ,020 8,135 1,694 1,286 9,714 Notes to the Financial Statements (Cont..) 4 Share of profit/(loss) of equity accounted investment (net of tax) (In Rs. '000) 2017 Commercial Insurance Brokers (Pvt) Ltd 9,631 7,652 Rainforest Ecolodge (Pvt) Ltd (1,540) (2,846) 8,091 4,806 5 Cash and cash equivalents (In Rs. '000) Cash & bank - Local Currency 531, , , ,638 - Foreign Currency ,485 82,297 Bank Overdrafts - (2,472) (64) (2,472) 531, , , ,463 Cash and cash equivalent held for sale ,251 - Cash and cash equivalent for the purpose of cash flow statements 531, , , ,463

11 Notes to the Financial Statements (Cont..) 6 Market value of a share Quarter ended 31 st December Quarter ended 31 st December Highest Lowest Last traded Ratios For the nine months ended 31 st December Basic earnings/(deficit) per share (Rs.) (3.52) (6.62) 1.79 Net assets per share (Rs.) Share trading Quarter ended 31st December Quarter ended 31st December No of transactions during the period No of shares traded during the period 383,186 76,458 Value of shares traded during the period 19,080,126 4,740,984 9 Stated capital No of Value No of Value shares shares ('000) Rs.000 ('000) Rs.000 As at 31 st December 15, ,250 15, , Dividend paid For the nine months ended 31 st December Rs. Rs. Final Directors' shareholding Shareholdings of the Directors together with their spouses are as follows : As at 31 st December S H Amarasekera 30,777 30,777 30,777 30,777

12 Notes to the Financial Statements (Cont..) 12 Twenty largest shareholders Name of the shareholder No of shares % CIC Holdings PLC 7,939, CIC Holdings PLC/ Charitable & Education Trust Fund 1,627, Seylan Bank PLC/ Dr. Thirugnanasambandar Senthilverl 660, National Development Bank/ Sakuvi Investment Trust (PVT) Ltd 538, CIC Agri Businesses (Pvt) Ltd 446, Mr. S.Srikanthan 418, Mr. S.K Wickremesinghe Trust (Guarantee) Limited 400, Mr. S.K Wickremesinghe 315, Mr. D.A.De Zoysa 190, Bank of Ceylon Account No 1 100, Mr. D.F.G. Dalpethado 93, Bensons Limited 83, Mrs. M.C.Abeyasekera 81, Mr. H.R. Peries 69, Dr. H.S.D. Soysa 68, Mr. Z.G. Carimjee 66, Mrs. H. G.S. Ansell 65, Shalsri Investments (Private) Ltd 64, Dawi Investment Trust (Pvt) Ltd 61, Dr. H.R.& Mr. V.K. Wickramasinghe - Custodian Trustees Martin Wickremasinghe Trust Fund 60, ,350, Public Holding No of shares % Parent company & related companies CIC Holdings PLC 7,939, CIC Trustees for Charitable & Educational Trust Fund 1,627, CIC Agri Businesses (Pvt) Ltd 446, Commercial Insurance Brokers (Pvt) Limited 93 - Directors together with their spouses and the employees 31, ,044, Public holding 5,705, ,750, Public Holding Ordinary shares of the held by public as at 31 st December 2017 were as follows : Number of public shareholders 1,224 Percentage of public holding 36.23% The Accounting Policies followed in the preparation of the Comprehensive Income Statement for the period ended 31 st December 2017 and the Statement of financial position as at 31 st December 2017 are consistent with those followed in the preparation of Financial Statements for the year ended 31 March 2017 and are in compliance with Sri Lanka Accounting Standard 34 - Interim Financial Reporting. The presentation and classification of figures for the corresponding period of the previous period have been amended, where relevant to be comparable with those for the current year. The Board has decided to cease its' export business entirely since it has been deemed to be non-viable. Consequently, the company will exit from its' investments in CAL Exports Lanka ( Private) Limited and Chemanex Exports (Private) Limited by way of a sale or winding up. will also cease its' paints business in a managed manner. The voluntary retirement scheme offered to the staff as per the company disclosure dated 31 st October 2017, is now being implemented and Chemanex PLC has recognised Rs.140Mn and CAL Exports Lanka (Private) Limited Rs.43Mn, under administration expeness and loss from discontinued operations respectively. Loss from discontinued operations of Rs.90.39Mn includes provision for voluntary retirement scheme on CAL Exports Lanka (Private) Limited and ceaseing of operations in CAL Exports Lanka (Private) Limited, Yasui Lanka (Private) Limited and Chemcel (Private) Limited The company entered in to a sale agreement on 15 th January 2018 to sell Rathmalana property apperaing in the Statement of Financial Position at its' revalued sum of Rs.229.5Mn, for Rs Mn and advance payment of Rs.1Mn was paid on the same date. Deed of transfer in favor of the purchaser was signed on 19 th January 2018 and the first installment of Rs Mn was also received. Second installment is due on 19 th April 2017 and the third and final installment is receivable on 19 th July 2018 which are secured by bank guarantees. There have not been any significant changes in the nature of the Contingnet Liabilities which were disclosed in the Annual Report for the year ended 31 st March All known expenses including management fees and similar expenses have been provided for in these Financial Statements. 21 There were no events subsequent to the reporting date, which require disclosure in the Interim Financial Statements.