THREE ACRE FARMS PLC

Transcription

1 THREE ACRE FARMS PLC INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2018

2 QUARTERLY REVIEW for the second quarter ended 30 June 2018 The Group s revenue for the second quarter of 2018 was Rs.641.2Mn compared to Rs.602.1Mn during the same quarter of 2017, representing an increase of Rs.39.1Mn or 6%. The Group's revenue for the first half of 2018 was Rs.1,298.3Mn compared to Rs.1,232.3Mn during the first half of 2017, representing an increase of Rs.66.0Mn or 5%. Group s revenue increased as a result of better demand and market prices for Broiler Day Old Chicks (DOCs). However, revenue from Layer DOCs continued to deteriorate due to instability in the table egg market. The Group reported a total comprehensive income of Rs.149.9Mn for the second quarter of 2018 compared to Rs.164.6Mn during the same period of 2017, representing a decrease of Rs.14.7Mn or 9%. The Group reported a total comprehensive income of Rs.316.1Mn for the first half of 2018 compared to Rs.353.8Mn during the same period of 2017, representing a decrease of Rs.37.7Mn or 11%. Group profitability was however adversely affected by the unfavourable weather condition, which gave rise to lower productivity in the commercial farms. Further, the increased number of unsold Layer DOCs and rising cost of production had depressed profit margins. The Company and the Group have adhered to the Sri Lanka Financial Reporting Standards in the preparation of the interim financial statements for the period ended 30 June There have been no other events subsequent to the interim period, which require disclosure in the interim financial statements. (Sgd.) Cheng Chih Kwong, Primus Executive Director and Chief Executive Officer (Sgd.) S S P Corporate Services (Private) Limited Secretaries Three Acre Farms PLC 2

3 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME All amounts in Sri Lankan Rupees thousands Group Group Company For the three months ended 30 June Change Revenue 641, ,123 6% 484, ,858 Cost of sales (496,893) (419,185) 19% (373,374) (351,066) Gross profit 144, ,938 (21%) 111, ,792 Other operating income / (expenses) 5, % (746) (35,191) Selling and distribution expenses (2,704) (3,801) (29%) (2,704) (3,801) Administrative expenses (7,285) (5,814) 25% (5,414) (4,138) Operating profit 139, ,132 (20%) 102, ,662 Finance income 43,602 23,808 83% 35,013 19,371 Finance costs (37) (8) 363% (31) (6) Profit before tax 183, ,932 (7%) 137, ,027 Taxation (33,563) (33,300) 1% (23,856) (26,150) Profit for the period 149, ,632 (9%) 113, ,877 Other comprehensive income for the period, net of tax Total comprehensive income for the period 149, ,632 (9%) 113, ,877 Profit attributable to : Equity holders of the parent 149, , , , , , , ,877 Total comprehensive income attributable to : Equity holders of the parent 149, , , , , , , ,877 Basic earnings per share (Rs.) Three Acre Farms PLC 3

4 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME All amounts in Sri Lankan Rupees thousands Group Group Company For the six months ended 30 June Change Revenue 1,298,278 1,232,269 5% 995,276 1,033,693 Cost of sales (983,100) (839,028) 17% (741,754) (699,621) Gross profit 315, ,241 (20%) 253, ,072 Other operating income / (expenses) 10,501 (3,565) NM (3,356) (39,569) Selling and distribution expenses (5,157) (7,960) (35%) (5,157) (7,960) Administrative expenses (13,095) (11,840) 11% (9,509) (8,521) Operating profit 307, ,876 (17%) 235, ,022 Finance income 83,363 49,505 68% 68,212 40,827 Finance costs (42) (11) 282% (34) (7) Profit before tax 390, ,370 (7%) 303, ,842 Taxation (74,622) (65,561) 14% (59,659) (52,736) Profit for the period 316, ,809 (11%) 244, ,106 Other comprehensive income for the period, net of tax Total comprehensive income for the period 316, ,809 (11%) 244, ,106 Profit attributable to : Equity holders of the parent 316, , , , , , , ,106 Total comprehensive income attributable to : Equity holders of the parent 316, , , , , , , ,106 Basic earnings per share (Rs.) Three Acre Farms PLC 4

5 CONSOLIDATED STATEMENT OF FINANCIAL POSITION All amounts in Sri Lankan Rupees thousands Group Company As at Assets Non-current assets Property, plant and equipment 1,359,058 1,404,849 1,041,024 1,081,766 Leasehold right over land 68,226 68,576 68,226 68,576 Investment in subsidiary companies Biological assets 473, , , ,571 Total non-current assets 1,900,473 1,974,535 1,463,635 1,530,913 Current assets Biological assets 17,908 27,649 9,973 19,994 Inventories 97,651 73,708 89,753 67,183 Trade and other receivables 79,182 53,398 71,904 49,129 Amount due from related companies 295, ,174 52,929 Current tax receivables 4,168 4, Cash and cash equivalents 1,459,494 1,423,668 1,145,122 1,169,584 Total current assets 1,953,892 1,582,591 1,678,926 1,358,819 Total assets 3,854,365 3,557,126 3,142,561 2,889,732 Equity Stated capital 623, , , ,604 Retained earnings 2,582,272 2,336,781 2,008,405 1,835,021 Total equity 3,205,876 2,960,385 2,632,009 2,458,625 Liabilities Non-current liabilities Deferred tax liabilities 202, , , ,972 Employee benefits 17,134 16,901 15,955 15,607 Total non-current liabilities 219, , , ,579 Current liabilities Trade and other payables 423, , , ,845 Amount due to related companies 4,588 73,877 3,514 3,683 Interest bearing borrowings Total current liabilities 428, , , ,528 Total liabilities 648, , , ,107 Total equity and liabilities 3,854,365 3,557,126 3,142,561 2,889,732 Net assets per share (Rs.) (Sgd.) K.A.R.S. Perera General Manager (Sgd.) Cheng Chih Kwong, Primus Executive Director and Chief Executive Officer (Sgd.) Tan Beng Chuan Executive Director and Group General Manager Three Acre Farms PLC 5

6 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY All amounts in Sri Lankan Rupees thousands Group Stated Retained Total For the six months ended 30 June capital earnings equity Balance as at 1 January ,604 1,774,951 2,398,555 Profit for the period - 353, ,809 Dividend paid - (94,180) (94,180) Other comprehensive income for the period, net of tax Balance as at 30 June ,604 2,034,580 2,658,184 Balance as at 1 January ,604 2,336,781 2,960,385 Profit for the period - 316, ,126 Dividend paid - (70,635) (70,635) Other comprehensive income for the period, net of tax Balance as at 30 June ,604 2,582,272 3,205,876 Company Stated Retained Total For the six months ended 30 June capital earnings equity Balance as at 1 January ,604 1,492,264 2,115,868 Profit for the period - 266, ,106 Dividend paid - (94,180) (94,180) Other comprehensive income for the period, net of tax Balance as at 30 June ,604 1,664,190 2,287,794 Balance as at 1 January ,604 1,835,021 2,458,625 Profit for the period - 244, ,019 Dividend paid - (70,635) (70,635) Other comprehensive income for the period, net of tax Balance as at 30 June ,604 2,008,405 2,632,009 Three Acre Farms PLC 6

7 CONSOLIDATED STATEMENT OF CASH FLOWS All amounts in Sri Lankan Rupees thousands Group Company For the six months ended 30 June Operating activities Profit before tax 390, , , ,842 Adjustments: Depreciation 52,204 53,986 45,708 47,631 Amortisation of leasehold right over land Usage of biological assets 247, , , ,559 (Profit) / loss on disposal of property, plant and equipment (492) 102 (492) 102 Change in fair value less cost to sell on biological assets (3,133) 5,000 10,537 5,000 Exchange gain (3,675) (1,030) (3,679) (1,055) Interest income (79,688) (48,475) (64,533) (39,773) Interest expenses Changes in working capital -Trade and other receivables (19,843) (39,512) (17,129) (34,700) -Inventories (23,943) (19,546) (22,570) (18,230) -Trade and other payables 66,028 (17,643) 36,888 (16,520) -Amount due from related companies (295,489) (138,134) (309,245) (177,959) -Amount due to related companies (69,289) (137,709) (169) (29,037) Employee benefits 989 1, ,339 Cash generated from operations 262, , , ,554 Exchange gain 3,675 1,030 3,679 1,055 Interest received 73,747 47,276 58,887 38,867 Interest paid (42) (11) (34) (8) Employee benefits paid (756) (697) (552) (697) Tax paid (20,702) (5,900) (18,137) (4,207) Net cash generated from operating activities 317, , , ,564 Investing activities Purchase of property, plant and equipment (6,661) (13,699) (5,214) (10,045) Proceeds from disposal of property, plant and equipment Purchase of biological assets (206,420) (250,991) (149,003) (174,157) Net cash used in investing activities (212,341) (264,690) (153,477) (184,202) Financing activities Dividend paid (70,635) (94,180) (70,635) (94,180) Net borrowings , ,957 Net cash used in financing activities (69,779) (80,259) (69,779) (83,223) Increase / (decrease) in cash and cash equivalents 35,826 9,442 (24,462) 5,139 Movements in cash and cash equivalents At the beginning of the year 1,423, ,773 1,169, ,296 Increase / (decrease) for the period 35,826 9,442 (24,462) 5,139 Balance at the end of the period 1,459, ,215 1,145, ,435 Three Acre Farms PLC 7

8 NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS 1. CORPORATE INFORMATION Three Acre Farms PLC (the Company ) is a Quoted Public Company with limited liability, incorporated and domiciled in Sri Lanka. The address of the Company s registered office is No.15, Rock House Lane, Colombo 15, Sri Lanka. The principal businesses of the Group are selective breeding, hatching, sale of Commercial Day Old Chicks (DOCs), both Broiler (for chicken meat) and Layer (for the production of table eggs), grandparent farm operation and commercial broiler farming. The Company was listed in the Colombo Stock Exchange under the Food and Beverage Sector. The parent company, Ceylon Grain Elevators PLC holds 57.21% (as at June 2018) of the stated capital of the Company. 2. APPROVAL OF FINANCIAL STATEMENTS The interim financial statements of the Company and the Group for the period ended 30 June 2018 are unaudited and authorised for issue by the Board of Directors on 7 August BASIS OF PREPARATION The interim financial statements of the Company and the Group have been prepared in compliance with Sri Lanka Accounting Standard (LKAS) 34 - Interim Financial Reporting. The interim financial statements have been prepared on a historical cost basis except for defined benefit obligation and biological assets. 4. ACCOUNTING POLICIES The accounting policies adopted are consistent with those of the previous financial year. 5. CONTINGENT LIABILITIES There has not been any significant change in the nature of the contingent liabilities, which were disclosed in the Annual Report for the year ended 31 December EVENTS AFTER THE REPORTING PERIOD Subsequent to 30 June 2018, there are no events, which require adjustments to or disclosure in the financial statements. 7. COMPARATIVE INFORMATION Comparative figures have been reported to be in line with the published Audited Financial Statements as at 31 December 2017, which are prepared and presented in accordance with the Sri Lanka Financial Reporting Standards. Three Acre Farms PLC 8

9 NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Contd.) 8. NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED SLFRS 16 - Leases SLFRS 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases. This standard requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under LKAS 17 - Leases. This standard becomes effective for annual periods beginning on or after 1 January 2019 (early adoption is permitted). The Group is assessing the potential impact on its consolidated financial statements resulting from the application of this new standard. 9. NM Change in percentage term is Not Meaningful. Three Acre Farms PLC 9

10 INVESTOR INFORMATION (01) Market Price per Share As at As at Highest Market Price (Rs.) Lowest Market Price (Rs.) Closing Market Price (Rs.) (02) Public Shareholding As at As at The percentage of shares held by the public 27.79% 27.79% The number of shareholders representing the public holding 2,605 2,697 (03) List of 20 major shareholders based on their shareholding as at 30 June 2018 No. Name No of Percentage Shares 1 Ceylon Grain Elevators PLC 13,469, Prima Limited, Singapore 3,532, HSBC Intl Nom Ltd UBS AG Zurich 617, Seylan Bank PLC / R.A. Rishard 385, Seylan Bank PLC / S.R. Fernando 354, Eka Limited 313, Supra Limited, Hong Kong 258, Phillip Securities Pte Ltd 240, Mr.M.M. Fuad 197, Assetline Leasing Company Ltd / M.N. Singa Laxana 178, Citizens Development Business Finance PLC 178, People s Leasing & Finance PLC / M.N. Singa Laxana 166, Seylan Bank PLC / C. N. Rajahmoney 161, People s Leasing & Finance PLC / HI Line Trading (Pvt) Ltd 160, Elgin Investments Limited 125, Mrs.D.M. Fernando 100, Mr.R.A. Rishard 90, Commercial Bank of Ceylon PLC / U.C. Bandaranayake 90, Mellon Bank N.A.-Commonwealth of Massachusetts 82, Merchant Bank of Sri Lanka PLC / K. R.U. Gunawardena 80, Total 20,784, Three Acre Farms PLC 10

11 CORPORATEINFORMATION Company Name Lawyers Three Acre Farms PLC Varners Lanka Law Office D.L. & F. De Saram Company Registration No. PQ 195 Auditors Registered Office KPMG, Colombo, Sri Lanka. No.15, Rock House Lane, Colombo 15, Sri Lanka. Tel : +94 (11) or 8 / / to Company Secretary Fax : +94 (11) S S P Corporate Services (Private) Limited info.cge@prima.com.lk No.101, Inner Flower Road, Colombo 3. Stated Capital Rs. 623,604,000 Number of Shares Bankers Hatton National Bank PLC Nations Trust Bank PLC 23,545,000 Ordinary Shares Bank of Ceylon Subsidiary Companies Ceylon Pioneer Poultry Breeders Limited Millennium Multibreeder Farms (Private) Limited National Development Bank PLC Seylan Bank PLC Union Bank of Colombo PLC Name of Directors Mr.Wickrema Senaka Weerasooria Mr. Cheng Chih Kwong, Primus Mr. Tan Beng Chuan Mr. Cheng Koh Chuen, Bernard Mr. Sunil Leeniyagoda Mr. Sunil Karunanayake (Demised on 27 May 2018) - Non-Executive Independent Chairman - Executive Director and Chief Executive Officer - Executive Director and Group General Manager - Non-Executive Director - Non-Executive Director - Non-Executive Independent Director Directors Shareholding Mr. Wickrema Senaka Weerasooria Mr. Cheng Chih Kwong, Primus Mr. Tan Beng Chuan Mr. Cheng Koh Chuen, Bernard Mr. Sunil Leeniyagoda Mr. Sunil Karunanayake (Demised on 27 May 2018) - 2,000 Shares - 19 Shares - Nil - Nil - Nil - Nil Three Acre Farms PLC 11