ARBICO PLC UNAUDITED FINANCIAL STATEMENT FOR THE PERIOD ENDED 30, 2017 1
Table of Content Results at a glance 3 Statement of comprehensive income 4 Statement of financial position 5 Statement of changes in equity 6 Statement of cash flows 7 Notes to the financial statements 8 2
Result at a Glance 2017 2016 2016 DEC REVENUE 3,899,540 2,958,047 3,413,465 PROFIT FOR THE PERIOD 41,464 117,445 (7,693) Earing Per share (Basic ) 0.28 0.79 (0.05) BY ORDER OF THE BOARD COMPANY SECRETARY FRC/2013/00000000001615 23rd October 2017 3
ARBICO PLC - EMBER 2017 STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD ENDED 30TH EMBER 2017 IAS 1.51 ( c) NOTES 2017 2016 2016 IAS 1.51( d ) DEC IAS 1.51 ( e) IAS 1.82 ( a) REVENUE 3 3,899,540 2,958,047 3,413,465 IAS 103 COST OF SALES (3,416,993) (2,320,360) (2,672,318) IAS 1.8 5, IAS 1 10 3 GROSS PROFIT 482,547 637,687 741,147 IAS 1.85 FINANCE INCOME 2,788 4,520 3,604 SALE OF SCRAPS 16,587 2,630 5,187 INCOME FROM ATTENDANCE 3,505 4,766 7,767 CLAIMS ON INSURANCE 4,067 - DISCOUNT ON PURCHASE 2,655 - RENT INCOME 3,235 28,179 46,073 SALE OF ASSETS 610 2,783 1,589 INCOME FROM EQUIPMENT RENTALS 7,330 18,214 664 IAS 1.85 INCOME FROM CHANGE IN INVENTORY 2,463 (684) - IAS 1.103 OPERATING EXPENSES (313,165) (421,250) (568,800) IAS 1.103 STAFF COST AND EMPLOYEES BENEFIT 4 (171,157) (159,401) (193,729) OPERATING PROFIT BEFORE TAX 41,464 117,445 43,502 IAS 1.82 INCOME TAX EXPENSES - - (51,195) IAS 1.82 ( F ) PROFIT FOR THE PERIOD 41,464 117,445 (7,693) EARNINGS PER SHARE Basic (k) 0.28 0.79 (0.05) Diluted (k) 0.28 0.79 (0.05) 4
ARBICO PLC - EMBER 2017 ACCOUNTS STATEMENT OF FINANCIAL POSITION FOR THE PERIOD ENDED 30TH EMBER 2017 DEC 2017 2016 2016 ASSETS NOTES NON - CURRENT ASSETS PROPERTY PLANT AND EQUIPMENT 5 1,367,303 1,145,485 1,136,701 UNQUOTED INVESTMENT 6 2,000 2,000 2,000 INTANGIBLE ASSETS 7 515 1,055 1,049 TOTAL NON CURRENT ASSETS 1,369,818 1,148,540 1,139,750 CURRENT ASSESTS INVENTORIES 35,733 23,901 11,497 STAFF LIABILITIES 138 1,946 TRADE DEBTORS 2,396,265 1,604,043 1,514,874 CONSTRUCTION CONTRACTS RECEIVABLE (UNCERTIFIED CLAIMS) 1,396,889 1,049,192 487,287 OTHER RECEIVABLES 8 590,786 393,566 434,635 PREPAYMENTS 10,475 6,677 4,881 CASH, BANK AND CASH EQUIVALENTS 267,980 274,559 285,713 DEFERRED TAX ASSETS 49,154 49,154 49,154 TOTAL NON CURRENT ASSETS 4,747,418 3,403,037 2,788,041 TOTAL ASSETS 6,117,235 4,551,577 3,927,791 LIABILITIES NON - CURRENT LIABILITIES SHARE DEPOSIT 1,950,000 1,950,000 1,950,000 ADVANCE FROM CLIENTS 166,541 166,541 166,541 TRADE AND OTHER PAYABLE 9 84,942 762,981 - TOTAL NON CURRENT LIABILITY 2,201,483 2,879,522 2,116,541 CURRENT LIABILITIES TRADE AND OTHER PAYABLE 9 1,903,013 79,632 1,093,846 ADVANCE FROM CLIENTS 1,672,739 610,233 299,419 PROVISIONS/ ACCRUALS 231,424 791,561 301,297 INCOME TAX PAYABLE - - 51,195 TOATL CURRENT LIABILITY 3,807,176 1,481,426 1,745,757 TOTAL LIABILITY 6,008,659 4,360,947 3,862,298 EQUITY SHARE CAPITAL 74,250 74,250 74,250 SHARE PREMIUM 141,184 141,184 141,184 RETAINED EARNINGS (106,858) (24,804) (149,941) TOTAL EQUITY 108,576 190,630 65,493 TOTAL EQUITY AND LIABILITY 6,117,235 4,551,577 3,927,791 Afolabi Aiyeola Director FRC/2015/IODN/00000012842 Eyo Asuquo Director FRC/2017/CIBN/00000000016193 Aderemi Idowu G Financial Officer FRC/2016/ICAN/00000014416 5
ARBICO PLC S TATEMENT O F CHANGES IN EQ UITY AS AT S EPT 2017 S HARE S HARE REVAL UATIO N ACCUMUL ATED TO TAL CAPITAL PREMIUM RES ERVE L O S S ES Balance 1/1/2017 74,250 141,184 861,934 (1,011,875) 65,493 Profit for the period - - - 41,464 41,464 Total Comprehensive Income for the year - - - 1,620 1,620 Dividend paid to shareholders - - - - - Issue of ordinary shares - - - - - Balance 31/3/2017 74,250 141,184 861,934 (968,791) 108,576 Balance 1/1/2016 74,250 141,184 861,934 (1,004,182) 73,186 Profit for the period - - - (7,693) (7,693) Total Comprehensive Income for the year - - - - - Dividend paid to shareholders - - - - - Issue of ordinary shares - - - - - Balance 31/12/2016 74,250 141,184 861,934 (1,011,875) 65,493 6
ARBICO PLC STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED 30TH 2017 DEC 2017 2016 2016 Operating activities Profit/ (loss) before tax 41,464 117,445 43,502 Non-cash adjustments to reconcile profit before tax to net cash flows: Depreciation of property, plant and equipment 1,175,879 947,424 235,209 Amortisation of intangible asset 10,974 10,215 733 (Gain)/ loss on disposal of property, plant and equipment (610) (2,783) (1,589) Finance income (2,787) (4,520) (3,604) Net unrealised Foreign exchange Loss - - 29,822 Bad debt 7,743-72,478 Impairement - - 28,609 Working capital adjustments (Increase)/ decrease in trade and other receivables (1,037,679) (357,962) (47,514) Decrease/ (Increase) in prepayments (5,594) 2,932 7,852 Decrease/ (Increase) in Inventories (24,236) (12,148) (1,269) Decrease/ (increase) in amounts due from customers for contract work (2,027,232) (468,791) 123,307 Increase in trade and other payables 894,109 (194,177) (217,274) (Decrease)/increase in advance from customers 1,373,320 89,288 (318,622) Increase in amounts due to customers for contract work - 13,477 (41,476) Income tax paid - - (12,416) Net cash flows from operating activities 405,351 140,400 (102,252) Investing activities Purchase of property, plant and equipment (426,481) (87,513) (118,257) Finance income 2,787 4,520 3,604 Proceeds from sale of property, plant and equipment 610 2,843 1,800 Advance payment in fixed deposit (restricted) - - 112,684 Net cash flows used in investing activities (423,084) (80,150) (169) Net (decrease)/increase in cash and cash equivalents (17,733) 60,250 (102,421) Cash and cash equivalents at the beginning of the year 274,559 214,309 281,056 Cash and cash equivalents at the end of the year 256,826 274,559 178,635 7
ARBICO PLC NOTES TO THE FINANCIAL STATEMENTS 1. Corporate information Arbico Plc is a company incorporated on 18 June 1958 in Nigeria and commenced business thereafter. The company s shares were quoted on the Stock Exchange on November 30, 1978. Its principal activities comprise construction and civil engineering as well as investment in and operation of infrastructure. The registered office is located at Plot D Block 7 Industrial Crescent Ilupeju, Lagos. 2. Basis of preparation The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB), the provisions of the Financial Reporting Council of Nigeria Act, No. 6 2011, the provision of the Companies and Allied and Matters Act, CAP 20 and the Laws of the Federation of Nigeria 2004 as applicable. The financial statements have been prepared on a historical cost basis, except for land and buildings that have been measured at fair value. The financial statements are presented in Naira and all values are rounded to the nearest thousand (N 000), except when otherwise indicated. 3. Revenue The company principally operates fixed price contracts, if the outcome of such a contract can be reliably measured, revenue associated with the construction contract is recognized by reference to the stage of completion of the contract activity at year end (the percentage of completion method). The outcome of a construction contract can be estimated reliably when: (i) The total contract revenue can be measured reliably; (ii) It is probable that the economic benefits associated with the contract will flow to the entity; (iii) The costs to complete the contract and the stage of completion can be measured reliably; and (iv) the contract costs attributable to the contract can be clearly identified and measured reliably so that actual contract costs incurred can be compared with prior estimates. When the outcome of a construction cannot be estimated reliably (principally during early stages of a contract), contract revenue is recognized only to the extent of costs incurred that are expected to be recoverable. In applying the percentage of completion method, revenue recognized corresponds to the total contract revenue (as defined below) multiplied by the actual completion rate based on the proportion of total contract costs (as defined below) incurred to date and the estimated costs to complete. Contract revenue Contract revenue corresponds to the initial amount of revenue agreed in the contract and any variations in contract work, claims and incentive payments to the extent that it is probable that they will result in revenue; and they are capable of being reliably measured. Contract costs Contract costs include costs that relate directly to the specific contract and costs that are attributable to contract activity in general and can be allocated to the contract. Costs that relate directly to a specific contract comprise; site Labour costs (including site supervision); costs of materials 8
used in construction; costs of design, cost of depreciation on plant and machinery and technical assistance that is directly related to the contract. The company contracts are typically negotiated for the construction of a single asset or a group of assets which are closely interrelated or interdependent in terms of their design, technology and function. In certain circumstances, the percentage of completion method is applied to the separately identifiable components of a single contract or to a group of contracts together in order to reflect the substance of a contract or a group of contracts. Assets covered by a single contract are treated separately when: (a) The separate proposals have been submitted for each asset (b) Each asset has been subject to separate negotiation and the contractor and customer have been able to accept or reject that part of the contract relating to each asset (c) The costs and revenues of each asset can be identified A group of contracts are treated as a single construction contract when: (a) the group of contracts is negotiated as a single package; (b) the contracts are so closely interrelated that they are, in effect, part of a single project with an overall profit margin (c) the contracts are performed concurrently or in a continuous sequence The three criteria must be met before combination can occur. Losses on contracts are recognized in the period in which they first become foreseeable. Contract losses are determined to be the amount by which estimated direct and indirect costs of the contract exceed the estimated total revenues that will be generated by the contract. During the period until the percentage of completion calculation is completed, all contract costs are accumulated in contract work in progress. The costs of the contract attributable to the stage of contract completion are transferred to cost of sales. Where the costs incurred plus recognized profits are greater than the sum of the recognized losses and progress billings, then this amount is shown in debtors as amounts due from customers for contract work. Where the sum of recognized losses and progress billings is greater, then this amount is shown in creditors as amounts due to customers for contract work. 017 2016 Revenue Construction contracts 3,899,540 2,958,047 4. Staff cost & Employees Benefit 2017 2016 Wages & Salaries 144, 103 142, 025 Staff Medical 7, 841 9, 477 Staff Training 8, 442 5, 490 Staff Welfare 10, 771 2, 407 TOTAL STAFF COST 171, 157 159, 401 9
5. Plant Property & Equipment There are no restrictions on title to the items of property, plant and equipment. The Company has not pledged any item of property, plant and equipment as security for liabilities. The fair value of the company s buildings is in line with the carrying amount. However, revaluation of the buildings are done at management discretion JAN, 2017, 2017 Carrying Carrying Value Additions Consumables Disposals Depreciation Value Leasehold Land & Building 733,500 49,496 684,004 Plant, Tools & Equipment 1,046,798 342,158 1,956 812,214 574,786 IT Infrastructure 28,590 5,303 1,061 26,965 5,868 Furniture 2,616 1,275 1,341 Motor Vehicles 316,105 79,020 7,902 285,919 101,304 2,127,609 426,481 10,918-1,175,869 1,367,303 6. Unquoted Investment Arbico Plc acquired 2,000,000 units of ordinary shares of N1 each in Home Trust Limited, which is involved in building and management of properties, in 2006. As at 31 December 2015, Arbico Plc holds less than 20% of the equity interest of Home Trust Limited. Home Trust Limited is a private entity that is not listed on any public exchange. In line with IAS 39.46c, the investment is measured at cost since the Company s equity is not quoted in an active market and the fair value of the asset cannot be reliably measured. The company has no intention to dispose this investment in the foreseeable future. 7. Intangible Assets JAN, 2017, 2017 Carrying Carrying Value Additions Consumables Disposals Depreciation Value Intangible Assets 11,489 10,974 515 10
8. Other Receivables SCHEDULE OF OTHER RECEIVABLE 2017 2016 Deposit for Asstes & Materials 138,171 - Due from services 47,395 46,656 Withholding Tax Credits 405,220 346,910 590,786 393,566 Withholding tax receivable (WHT) represent amount deducted at source by customers from payment to the Company in line the withholding tax law. The customer is expected to remit the amount withheld to the relevant tax authority and obtain withholding tax credit note in the name of Arbico Plc. The WHT credit note can be used to offset future tax liability. 9. Trade & other Payables 2017 2016 Pension 18,713 21,528 Other Taxes 335,624 241,077 Trade and Service Payable 1,633,609 580,008 1,987,946 842,613 Other taxes payable include Pay-As-You-Earn (PAYE), value added tax payable and withholding tax payable. Accruals are with respect to job done by sub-contractors for which project certificate/invoices have not been received as agreed milestones have not been reached. 11