Sri Lanka Telecom : Interim Financial Statements for period ended 31st March 2024

Sri Lanka Telecom PLC

Interim Condensed Consolidated Financial Statements

For the Quarter ended

31 March 2024

Sri Lanka Telecom PLC

Company Registration No. PQ 7

Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income

(All amounts in LKR Millions )

Revenue

Direct costs

Gross Profit

Sales and marketing costs

Administrative costs

Operating profit

Other income

Dividend Income from subsidiaries - and associates

Interest expenses and finance cost Foreign exchange gain/ (loss) Interest income

Share of profit / (loss) from equity - accounted investee

Profit before tax for the period Income tax expenses

Profit for the period

Other comprehensive income

Defined benefit plan actuarial gain/ (loss)

Tax on other comprehensive income

Other comprehensive income for the period (net of tax)

Total Comprehensive Income for the Period

Profit /(loss) Attributable to :

Owners of the company

Non-controlling interest

Total Comprehensive Income attributable to:

Owners of the company

Non-controlling interest

Earnings per share - Basic (Rs.)

Group

Jan - Mar

2024	2023
(Reviewed)	(Reviewed)
26,929	26,554
(16,154)	(15,885)
10,775	10,669
(2,805)	(2,799)
(5,912)	(5,772)
2,058	2,098
303	759
95	-
(2,285)	(2,223)
399	408
251	553

1. (5)

1. 1,590

1. (633)

156 957

245 306

94(92)

339 214

495 1,171

154 956

21

156 957

493 1,170

1. 1

1. 1,171

0.09 0.53

Company

Jan - Mar

2024	2023
(Reviewed)	(Reviewed)
17,714	17,560
(10,209)	(9,844)
7,505	7,716
(1,498)	(1,282)
(4,424)	(4,461)
1,583	1,973
366	818

95-

(1,818) (1,951)

1. (308)

188 308

1(5)

400 835

1. (209)

286 626

245 304

74(91)

319 213

605 839

286 626

-

-

286 626

605 839

-

-

605 839

0.16 0.35

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Sri Lanka Telecom PLC

Company Registration No. PQ 7

Interim Condensed Consolidated Statement of Financial Position

(All amounts in LKR Millions )
Group	Company

Assets

Non-Current Assets

Property,plant and equipment

Right-of-use assets

Intangible assets and goodwill

Investments in subsidiaries

Investments in associates

Deferred tax assets

Contract assets

Investments In equity Shares

Other receivables

Total Non-current Assets

Current Assets

Inventories

Trade and other receivables

Current tax receivables

Contract assets

Other investments

Cash and cash equivalents

Total Current Assets

Total Assets

Equity and Liabilities

Equity

Stated capital Insurance reserve Retained earnings

Equity attributable to equity share - holders of the company

Non controlling Interest

Total Equity

Non Current Liabilities

Borrowings

Vendor financing

Lease liability

Contract liabilities

Deferred income

Deferred tax liabilities

Employee benefits

Trade and other payables

Total Non Current Liabilities

Current Liabilities

Borrowings

Vendor financing

Lease liability

Contract liabilities

Deferred income

Current tax liabilities

Trade and other payables

Total Current Liabilities

Total Liabilities

Total Equity and Liabilities

31 Mar 2024	31 Dec 2023		31 Mar 2024	31 Dec 2023
(Reviewed)	(Audited)		(Reviewed)	(Audited)
176,456	174,803		136,115	136,202
5,207	5,761		737	813
10,551	10,364		3,390	3,200
-	-		14,431	14,431
515	514		515	514
350	365		-	-
1,090	1,091		321	350
2	2		-	-
3,342	3,496		3,318	3,471
197,513	196,396		158,827	158,981
3,587	4,078		2,665	3,240
33,122	32,015		22,925	21,650
193	181		152	142
1,494	1,511		162	146
155	117		-	-
11,174	12,377		4,932	5,330
49,725	50,279		30,836	30,508
247,238	246,675		189,663	189,489
18,049	18,049		18,049	18,049
300	300		300	300
70,647	70,152		50,396	49,791
88,996	88,501		68,745	68,140
122	120		-	-
89,118	88,621		68,745	68,140
34,782	36,318		32,649	34,851
12,505	12,770		12,505	12,770
2,823	3,617		241	267
1,669	1,776		1,669	1,776
1,193	1,250		1,193	1,250
9,918	9,602		7,724	7,683
5,957	6,117		5,061	5,221
4,076	5,225		2,834	3,399
72,923	76,675		63,876	67,217
32,888	27,456		24,948	19,778
8,961	7,278		4,420	4,178
2,889	2,619		565	617
1,197	1,236		906	956
3,731	3,677		281	325
384	411		-	-
35,147	38,702		25,922	28,278
85,197	81,379		57,042	54,132
158,120	158,054		120,918	121,349
247,238	246,675		189,663	189,489

I certify that these financial statements have been prepared in compliance with the requirements of the Companies Act No.07 of 2007.

Signed

Sanjeewa Samaranayake

Chief Financial Officer

The Board of Directors is responsible for these financial statements.These financial statements were approved by the Board of Directors on 14 May 2024.

Signed for and behalf of the Board.

Signed		Signed
A.K.D.D.D.Arandara		M.M.C.P. Mohottigedara
Chairman	-3-	Director

Sri Lanka Telecom PLC

Company Registration No. PQ 7

Interim Condensed Consolidated Statement of Changes In Equity

For the three months ended 31 March 2024

(All amounts in LKR Millions )
Group		Attributable to owners of the Company
					Non
	Stated	Insurance	Retained	Total	controlling	Total
	capital	reserve	earnings		interest	equity
Balance as at 1 January 2023	18,049	300	74,024	92,373	115	92,488
Subsidiary liquidation impact	-	-	157	157	-	157
Non Controlling interest	-	-	-	-	5	5
Total comprehensive income for the year
Net loss for the year	-	-	(3,921)	(3,921)	-	(3,921)
Other comprehensive income / (expense)
Defined benefit plan actuarial gain,net of tax	-	-	343	343	-	343
Total other comprehensive income for the year	-	-	343	343	-	343
Total comprehensive income for the year	-	-	(3,578)	(3,578)	-	(3,578)
Transactions with owners, recorded directly in equity
Contribution by and distribution to owners
Dividends to equity share holders	-	-	(451)	(451)	-	(451)
Balance as at 31 December 2023	18,049	300	70,152	88,501	120	88,621
Balance as at 1 January 2024	18,049	300	70,152	88,501	120	88,621
Non controlling interest	-	-	-	-	2	2
Total comprehensive income for period
Net profit for the period	-	-	156	156	-	156
Other comprehensive income /(expense)
Defined benefit plan actuarial gain,net of tax	-	-	339	339	-	339
Total other comprehensive income for period	-	-	339	339	-	339
Total comprehensive income for the period	-	-	495	495	-	495
Balance as at 31 March 2024	18,049	300	70,647	88,996	122	89,118

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Sri Lanka Telecom PLC

Company Registration No. PQ 7

Interim Condensed Consolidated Statement of Changes In Equity

For the three months ended 31 March 2024

(All amounts in LKR Millions )
Company	Attributable to owners of the Company
	Stated	Insurance	Retained	Total
	capital	reserve	earnings
Balance as at 1 January 2023	18,049	300	51,197	69,546
Total comprehensive income for the year
Net loss for the year	-	-	(1,132)	(1,132)
Other comprehensive income / (expense)
Defined benefit plan actuarial loss,net of tax	-	-	177	177
Total other comprehensive income for the year	-	-	177	177
Total comprehensive income for the year	-	-	(955)	(955)
Transactions with owners,recorded directly in equity
Contribution by and distribution to owners
Dividends to equity share holders	-	-	(451)	(451)
Balance as at 31 December 2023	18,049	300	49,791	68,140
Balance as at 1 January 2024	18,049	300	49,791	68,140
Total comprehensive income for period
Net profit for the period	-	-	286	286
Other comprehensive income / (expense)
Defined benefit plan actuarial gain,net of tax	-	-	319	319
Total other comprehensive income for period	-	-	319	319
Total comprehensive income for the period	-	-	605	605
Balance as at 31 March 2024	18,049	300	50,396	68,745

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Sri Lanka Telecom PLC

Company Registration No. PQ 7

Interim Condensed Consolidated Statement of Cash Flows

For the three months ended 31 March 2024

(All amounts in LKR Millions)

GROUPCOMPANY

Operating activities

Cash generated from operations

Interest received

Interest paid

Tax paid

Gratuity paid

Net cash generated from operating activities

Cash flows from Investing activities

Acquisition of property,plant and equipment Acquisition of intangible assets Proceeds from disposal of property, plant

and equipment

Proceeds / (Purchase) of short term investments

Net cash used in investing activities

Cash flows from Financing activities

Proceeds from borrowings

Cash payment for the principle portion of lease liability Finance lease principal re-payments

Re-payment on borrowings

(Decrese) / Increase in vendor financing and other non current liabilities

Net cash generated from / (used) financing activities

(Decrease) / Increase in cash and cash equivalents

Movement in Cash and cash equivalents

Cash and cash equivalents at beginning of the year

Effect on exchange fluctuation on cash and cash equivalents

Increase/(Decrease) in cash and cash equivalents

Cash and cash equivalents at 31 March (Note)

Note

Cash and cash equivalents

Bank overdraft

2024	2023		2024	2023
5,924	8,892		4,044	2,625
262	555		199	310
(2,962)	(3,782)		(2,687)	(3,569)
(335)	(582)		-	(131)
(190)	(148)		(149)	(113)
2,699	4,935		1,407	(878)
(7,304)	(10,833)		(3,939)	(9,233)
(736)	(1,330)		(437)	(23)
117	64		78	58
(49)	3,301		(11)	3,302
(7,972)	(8,798)		(4,309)	(5,896)
11,000	7,500		3,000	7,000
(614)	(702)		(160)	(151)
-	(1)		-	(1)
(9,344)	(2,349)		(2,202)	(935)
1,103	913		(359)	2,579
2,145	5,361		279	8,492
(3,128)	1,498		(2,623)	1,718
5,058	8,587		(211)	873
(636)	(891)		(275)	(474)
(3,128)	1,498		(2,623)	1,718
1,294	9,194		(3,109)	2,117
11,174	13,418		4,932	5,550
(9,880)	(4,224)		(8,041)	(3,433)
1,294	9,194		(3,109)	2,117

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Sri Lanka Telecom PLC

Notes to the Interim Condensed Consolidated Financial Statements

For the quarter ended 31 March 2024.

1. Reporting Entity

Sri Lanka Telecom PLC (the 'Company') is a company domiciled in Sri Lanka. The address of the Company's registered office is Lotus Road, Colombo 1. The interim condensed separate financial statements relate to Sri Lanka Telecom PLC. These interim condensed consolidated financial statements ('interim financial statements') as of 31 March 2024 and for the three months ended 31 March 2024 comprise the Company and its subsidiaries (together referred to as the 'Group').

The Group is primarily involved in providing a broad portfolio of telecommunication services across Sri Lanka. In addition, the range of services provided by the Group include, inter-alia, internet services, data services, domestic and international leased circuits, broadband, satellite uplink, maritime transmission, IPTV service and directory publishing service. The Company is listed on the Colombo Stock Exchange.

1. Basis of accounting

These interim condensed consolidated financial statements have been prepared in accordance with Sri Lanka Accounting Standard - LKAS 34, 'Interim Financial Reporting' and do not include all the information required for a complete set of SLFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant for an understanding of the changes in the Group's financial position and performance since the last audited financial statements as of 31 December 2023 and for the year ended 31 December 2023.

These interim financial statements were authorized for issue by the Company's Board of Directors on 14 May 2024.

1. Significant accounting policies

The accounting policies applied in these interim financial statements are the same as those applied in the audited financial statement as of 31 December 2023 and for the year ended 31 December 2023.

IV. Use of Judgments and estimates

The management has made judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense when preparing these interim financial statements. Actual results may differ from these estimates.

The significant judgments made by management in applying the Group's accounting policies and the key sources of estimation were the same as those applied to the audited financial statements as of 31 December 2023 and for the year ended 31 December 2023.

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Sri Lanka Telecom PLC

Notes to the Interim Condensed Consolidated Financial Statements

For the quarter ended 31 March 2024.

1. Operating segments

Information relevant to the operating segments are presented in a method consistent with the management reporting provided to those charged with governance.

1. Information about reportable segments (All amounts in Rs.Mn)

	Fixed ICT	Mobile	IPTV	Other Segments	Total
	Operations	Operations	Operations**	Operations
	Jan - Mar	Jan - Mar	Jan - Mar	Jan - Mar	Jan - Mar
	2024	2023	2024	2023	2024	2023	2024	2023	2024	2023
External revenues	15,974	16,043	10,574	10,174	71	39	310	298	26,929	26,554
Inter- segment revenue	1,740	1,517	372	422	945	939	554	560	3,611	3,438
Reportable segment
revenue	17,714	17,560	10,946	10,596	1,016	978	864	858	30,540	29,992
Reportable segment
profit /(loss) - before tax	400	835	50	266	430	344	(39)	(36)	841	1,409
Foreign exchange gain /
(loss)	(15)	(308)	277	375	137	341	-	-	399	408
Interest income	188	308	62	243	3	-	2	2	255	553
Interest expenses &	(1,818)	(1,951)	(490)	(297)	-	-	(11)	(15)	(2,319)	(2,263)
Finance costs
Depreciation and	(4,774)	(4,163)	(2,604)	(2,491)	(35)	(14)	(8)	(6)	(7,421)	(6,674)
amortization

• IPTV operation is identified as a reportable segment in accordance with quantitative thresholds as per SLFR 8 - Operating Segments.

	Jan - Mar	Jan -Mar
Revenues	2024	2023
Total revenue for reportable segments	29,676	26,134
Revenue for other segments	864	858
Reportable segment revenue	30,540	29,992
Elimination of inter- segment revenue	(3,611)	(3,438)
Consolidated revenue	26,929	26,554
Profit or loss
Total profit for reportable segments	880	1,445
Profit or (loss) for other segments	(39)	(36)
Reportable segment profit before tax before elimination	841	1,409
Inter- segment profits adjustment	(19)	181
Consolidated profit or (loss) before tax	822	1,590
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Sri Lanka Telecom PLC

Notes to the Interim Condensed Consolidated Financial Statements

For the quarter ended 31 March 2024.

1. Operating segments (Continued) Assets & Liabilities

			31 Mar	31 Dec
			2024	2023
		Assets
		Total assets for reportable segments	271,198	270,463
		Assets for other segments	2,023	1,806
			273,221	272,269
		Elimination of inter - segment assets	(25,983)	(25,594)
		Consolidated total assets	247,238	246,675
		Liabilities
		Total liabilities for reportable segments	168,358	168,191
		Liabilities for other segments	1,408	1,138
			169,766	169,329
		Elimination of inter- segment liabilities	(11,646)	(11,275)
		Consolidated total liabilities	158,120	158,054
VI.	Seasonal or cyclical factors

The operations of the Group were not significantly affected by any seasonal or cyclical factors.

1. Impact on Property, Plant and Equipment
   The Group has assessed the impact on property, plant and equipment and spectrum assigned to the Group. The Group will continue to take proactive measures to mitigate any potential impact and will continue its contingency plans and risk management measures as the situation evolves.

VII.	Property Plant and equipment

1. Acquisitions and Disposals
2. 1. During the three months ended 31 March 2024, the Group acquired assets at a cost of Rs 7,347 Mn (three months ended 31 March 2023- Rs.11,014 Mn).
   2. Assets with a written down value of Rs.11 Mn were disposed during the three months ended 31 March 2024 (three months ended 31 March 2023 written down value of Rs 1 Mn), resulting in a gain on disposal of Rs.106 Mn (three months ended 31 March 2023 gain of Rs.63 Mn), which was included in 'Other Income' in the Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income.
3. Impairment of Property, plant and equipment
   During the three months ended 31 March 2024 Company has recognized an impairment loss of Rs. NIL (three months ended 31 March 2023 Rs. 91 Mn)

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Sri Lanka Telecom PLC

Notes to the Interim Condensed Consolidated Financial Statements

For the quarter ended 31 March 2024.

1. Capital commitments.

		Group (Rs. Mn)	Company (Rs. Mn)
		31 Mar 2024	31 Dec 2023	31 Mar 2024	31 Dec 2023
	Property plant and equipment
	Approved but not contracted	12,343	15,188	9,258	7,960
	Approved and contracted	19,233	19,009	14,187	14,218
VIII.	Capital and Reserves
(a)	Stated Capital
Stated capital of the Company consists of 1,804,860,000 ordinary shares.
IX.	Loans and Borrowings

Material additions to loans and borrowings at Group level for the year under review:

Additions	Currency	Amount (Rs. Mn.)
Bank loan - 31 Mar 2024	LKR	11,000

Material repayment of loans and borrowings at Group level for the period under review:

Repayments

Currency

Amount (Rs. Mn.)

Bank loan - 31 Mar 2024

LKR

9,344

1. Contingencies

There were no significant changes to the list of contingencies disclosed in the latest annual report of 2023 and interim condensed consolidated financial statements for the quarter ended 31 December 2023.

XI.	Related Parties

Material related party transactions during the period under review:

Company	Nature of Transaction	Transaction Value (Rs. Mn)	Amount due (to)/ from related
				parties (Rs. Mn)
		31 Mar 2024	31 Mar 2023	31 Mar 2024	31 Dec 2023
Mobitel	Sale of goods and	1,706	1,477	1,975	1,941
(Private)	services
Limited	Purchase of goods and	355	422	(3,787)	(3,072)
	services

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