Agha Steel Industries : Transmission of quarterly Report For the period 31st March, 2024

Quarterly Report March 31, 2024

Financial Report for the Quarter ended March 31, 2024

TABLE OF CONTENTS

Contents

Company Information

Directors' Review Report

Condensed Interim Statement of Financial Position

Condensed Interim Statement of profit or Loss and Other Comprehensive Income

Condensed Interim statement of Cash Flows

Condensed Interim statement of Changes in Equity

Notes to the Condensed Interim Financial Statements

Financial Report for the Quarter ended March 31, 2024

	CORPORATE INFORMATION
BOARD OF DIRECTORS
Mrs. Shazia Agha	Chairperson, Non-Executive Director
Mr. Hussain Iqbal Agha	Chief Executive Officer
Mr. Raza Agha	Executive Director
Mr. Asif Ahmad	Non-Executive Director
Mr. Muhammad Shahid	Non-Executive Director
Mr. Muhammad Asif	Independent Director
Mr. Saeed Mirza	Independent Director
AUDIT COMMITTEE
Mr. Saeed Mirza	Chairman
Mr. Asif Ahmad	Member
Mr. Muhammad Asif	Member
HUMAN RESOURCE & RUMENERATION COMMITTEE
Mrs. Shazia Agha	Chairperson
Mr. Muhammad Shahid	Member
Mr. Raza Agha	Member

CHIEF FINANCIAL OFFICER

Mr. Kamran Ahmed

COMPANY SECRETARY

Mr. Muhammad Muneeb Khan

HEAD OF INTERNAL AUDIT

Mr. Umar Irshad

EXTERNAL AUDITORS

Reanda Haroon Zakaria & Company Chartered Accountants

Progressive Plaza, Baumont Road, Karachi, Pakistan

Financial Report for the Quarter ended March 31, 2024

SHARE REGISTRAR

CDC Share Registrar Services Limited

CDC House, Main Shahrah-e-Faisal, Karachi, Pakistan

LEGAL ADVISOR

Asad Mehmood

Uni Shopping Center, Abdullah Haroon Road, Karachi, Pakistan

BANKERS
 Bank Al Habib Limited	 	Faysal Bank Limited
	Askari Bank Limited	 Habib Metro Bank Limited
	Habib Bank Limited	 MCB Islamic Bank Limited
 Bank Al Falah Limited		MCB Bank Limited
	Meezan Bank Limited	 Dubai Islamic Bank Limited
 Bank Islami Pakistan Limited	 The Bank of Khyber
	United Bank Limited	  National Bank of Pakistan
	JS Bank Limited	 Allied Islamic Bank Limited
	Samba Bank Limited		Bank of Punjab

• Soneri Bank Limited

REGSITERED OFFICE

Plot No. N.W.I.Z/1/P-133,(SP-6),D-2, Port Qasim Authority, Karachi, Pakistan PTCL# 021-34156219-21

CORPORATE OFFICE

Office 801 & 804, 8th Floor, Emerald Tower, G-19

1. Talwar, Block 5, Clifton, Karachi, Pakistan UAN # [e-mail]

SYMBOL AT PAKISTAN STOCK EXCHANGE

AGHA

WEBSITE INFORMATION

www.aghasteel.com

Financial Report for the Quarter ended March 31, 2024

DIRECTORS' REVIEW REPORT

The Directors of your Company are pleased to present the Financial Statements for the Third Quarter ended March 31, 2024.

MACRO-ECONOMIC CHALLENGES

The Economy faced significant challenges in the third quarter of FY 2024, with high inflation and widening fiscal deficit. However, positive developments including IMF funding, improved exports, and rising foreign exchange reserves offered the potential for a rebound in 2024. The government's continued commitment to energy, fiscal, and external sector reforms is anticipated, yet potential fiscal slippages and delayed reforms pose substantial risks. While economic stabilization is expected in the later stages 2024, the pace of recovery hinges on the successful implementation of planned reforms and sustained external funding assurances.

MANAGEMENT'S RESPONSE

The management is actively engaged in a thorough review of our operations, aiming to identify areas for improvement and implement strategic adjustments to address the issues contributing to the current loss. Our focus is on stabilizing operations, optimizing costs, and exploring avenues for recovery.

FINANCIAL PERFORMANCE

Your Company showed a decline in revenue during the current period, the Company recorded net sales revenue of Rs. 2,647 million during the 03rd Quarter as compared to Rs. 5,689 million in the corresponding period. The gross loss stood at Rs. (585) million as compared to gross profit of Rs. 1,373 million in the corresponding period. . The Net loss after tax stood at Rs. (1,815) million as compared to net profit after tax of Rs. 303 million in the corresponding period.

Key financial highlights of the company is as follows:

Nine Months	Nine Months	Three Months	Three Months
ended	ended	ended March	ended March 31,
March 31, 2024	March 31, 2023	31, 2024	2023
(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)

(Rs. in million)

Financial Report for the Quarter ended March 31, 2024

Sales - net	11,991	15,452	2,647	5,689
Gross Profit/(Loss)	1,224	3,620	(585)	1,373
Operating Profit/(Loss)	(2,648)	772	(2,098)	379
Profit /(Loss) before			(2,100)	356
tax	(2,620)	969
Profit/(Loss) after tax	(2,034)	705	(1,815)	303
Earnings per share
Basic (in Rupees)	(3.36)	1.17	(3.00)	0.50
Diluted (in Rupees)	(3.36)	1.17	(3.00)	0.50

EARNINGS PER SHARE

Basic and Diluted Earnings per share for the period ended March 31st, 2024 was Rs. (3.00) as compared with Rs. 0.50 per share in the corresponding period.

FUTURE PROSPECTS

Our strategic initiatives include a comprehensive review of our product offerings, exploring partnerships and collaborations, and adopting innovative technologies to enhance our operational efficiency. We are also evaluating market trends and customer preferences to align our offerings with the evolving demands of the industry.

ACKNOWLEDGEMENT

The Board would like to place on record the all stakeholders, Securities and Exchange Commission of Pakistan, Pakistan Stock Exchange, State Bank of Pakistan, banks/financial Institutions, especially its customers as well as the vendors and suppliers, for their continued commitment and support to the Company. The Board would also like to thank all staff members of the Company in performing their tasks with diligence and commitment.

Financial Report for the Quarter ended March 31, 2024

FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

________________	__________________
Hussain Iqbal Agha	Raza Iqbal Agha
Chief Executive Officer	Director
Karachi: April 29, 2024

Financial Report for the Quarter ended March 31, 2024

AGHA STEEL INDUSTRIES LIMITED

STATEMENT OF FINANCIAL POSITION

AS AT MARCH 31, 2024

		March 31	June 30
		2024	2023
		(Un-audited)	(Audited)
ASSETS		- - - - Rupees in '000'- - - -
Non-Current Assets
Property, plant and equipment	6	22,590,018	21,277,380
Intangible asset		39,250	42,390
Long term deposits and receivable	7	414,967	449,463
		23,044,235	21,769,233
Current Assets
Stores, spare parts and loose tools		2,904,197	2,360,897
Stock-in-trade	8	4,821,751	10,439,863
Trade and other receivables	9	5,880,536	4,948,795
Loans and advances	10	2,354,153	1,815,346
Deposits		12,500	17,632
Tax refunds due from Government		588,966	540,924
Cash and bank balances		388,412	87,295
		16,950,515	20,210,752
Total Assets		39,994,750	41,979,985
EQUITY AND LIABILITIES
Share Capital and Reserves
Authorized Capital	11	9,250,000	6,250,000
Share Capital
Issued, subscribed and paid up capital		6,048,791	6,048,791
Capital reserve		2,126,687	2,126,687
Revenue Reserve
Unappropriated profit		6,360,770	8,394,972
Total Shareholders' Equity		14,536,248	16,570,450
Non-Current Liabilities
Long term borrowings	12	7,735,001	4,223,940
Advance against preference shares	13	750,000	500,000
Lease liabilities		90,237	108,721
Deferred liability		249,971	1,063,819
		8,825,209	5,896,480
Current Liabilities
Trade and other payables	14	639,688	829,386
Accrued markup		1,524,497	807,704
Short term borrowings	15	14,243,421	13,728,859
Current portion of non-current liabilities	16	225,687	4,147,106
		16,633,293	19,513,055
Contingencies and Commitments	17
Total Capital and Liabilities		39,994,750	41,979,985

The annexed notes from 1 to 22 form an integral part of this condensed interim financial statements.

___________________		___________________
Chief Executive	Chief Financial Officer	Director

AGHA STEEL INDUSTRIES LIMITED

CONDENSED INTERIM STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE

INCOME (UN-AUDITED)

FOR THE NINE MONTHS PERIOD ENDED MARCH 31, 2024

		Nine Months	Quarter Ended
		March 31,	March 31,
		2024	2023	2024	2023
	Note	- - - - - - - - - - - (Rupees in '000') - - - - - - - - - - -
Turnover - gross		14,149,923	18,107,187	3,147,760	6,684,370
Sales tax		(2,158,463)	(2,655,167)	(500,964)	(995,442)
Turnover - net		11,991,460	15,452,020	2,646,796	5,688,928
Cost of sales		(10,767,366)	(11,831,721)	(3,231,543)	(4,316,385)
Gross profit /(Loss)		1,224,094	3,620,299	(584,747)	1,372,543
Administrative expenses		(241,198)	(247,800)	(70,272)	(104,422)
Selling and distribution costs		(251,411)	(338,476)	(60,522)	(136,875)
Finance costs		(3,379,887)	(2,262,505)	(1,382,708)	(752,318)
		(3,872,496)	(2,848,781)	(1,513,502)	(993,615)
Operating (Loss) / profit		(2,648,402)	771,518	(2,098,249)	378,928
Other expenses		(229,365)	(163,701)	(78,492)	(102,012)
Other income		257,346	361,420	76,270	78,602
(Loss) / Profit before taxation		(2,620,421)	969,237	(2,100,471)	355,518
Taxation - net		586,219	(264,247)	285,309	(52,674)
(Loss) / Profit after taxation		(2,034,202)	704,990	(1,815,162)	302,844
Other comprehensive (Loss)/ income for the peri	-	-	-	-
Total comprehensive (Loss) /	income	(2,034,202)	704,990	(1,815,162)	302,844
for the period
Earnings per share
Basic and diluted - Rupees	18	(3.36)	1.17	(3.00)	0.50

The annexed notes from 1 to 22 form an integral part of this condensed interim financial statements.

___________________	___________________	___________________
Chief Executive	Chief Financial Officer	Director

AGHA STEEL INDUSTRIES LIMITED

CONDENSED INTERIM STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS PERIOD ENDED MARCH 31, 2024

		March 31,
		2024	2023
		Un-Audited
A. CASH FLOWS FROM OPERATING ACTIVITIES	Note	- - - - Rupees in '000'- - - -
Profit before taxation		(2,620,421)	969,237
Adjustments for:
Depreciation	6.1	318,178	332,252
Amortization		3,140	3,140
Impairment loss on trade receivables - net	9	229,115	39,649
Finance cost		3,369,785	2,254,786
Amortization of government grant		-	(1,367)
Finance lease markup		10,102	7,719
Workers welfare fund		-	52,164
Workers profit participation fund		250	21,887
Exchange loss - net		-	50,000
Cash generated from operations before working capital changes		1,310,149	3,729,467
Changes in working capital
(Increase) / decrease in current assets
Stores, spare parts and loose tools		(543,300)	(725,463)
Stock-in-trade	8	5,618,112	3,494,848
Trade and other receivables	9	(1,160,856)	(428,123)
Loans and advances	10	(538,807)	141,294
Deposits		5,132	9,472
		3,380,281	2,492,028
(Decrease) / increase in current liabilities
Trade and other payables		(137,004)	(330,898)
Net cash generated from operations		4,553,426	5,890,597
Taxes paid - net		(275,672)	(186,375)
Workers profit participation fund paid		(52,944)	-
Financial charges paid		(2,663,094)	(2,431,985)
Net cash generated from operating activities		1,561,716	3,272,237
B. CASH FLOWS FROM INVESTING ACTIVITIES
Long term deposits and receivable recovered - net	7	34,496	32,144
Additions in capital work in progress - net	6.2	(1,865,781)	(1,186,742)
Damage (disposals) in property, plant and equipment	6.1	673,801
Additions in property, plant and equipment	6.1	(438,836)	(258,688)
Net cash used in investing activities		(1,596,320)	(1,413,287)
C. CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of long-term borrowings - net	12	(410,358)	80,539
Advance received against shares	13	250,000	-
Lease rentals paid		(18,484)	(20,845)
Receipts / (Repayments) of short-term borrowings - net	15	514,562	(1,902,154)
Net cash generated from / (used in) financing activities		335,721	(1,842,460)
Net decrease in cash and cash equivalents (A+B+C)		301,117	16,490
Cash and cash equivalents at the beginning of the period		87,295	215,063
Cash and cash equivalents at the end of the period		388,412	231,553

The annexed notes from 1 to 22 form an integral part of this condensed interim financial statements.

___________________		___________________
Chief Executive	Chief Financial Officer	Director