Amtex : Transmission of Quarterly Report for the Quarter Ended December 31 2022

AMTEX LIMITED

Half Yearly Report

December 31, 2022

A M T E X

CONTENTS

COMPANY INFORMATION

DIRECTOR'S REPORT

AUDITOR'S REVIEW REPORT

CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION CONDENSED INTERIM STATEMENT OF PROFIT & LOSS ACCOUNT CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME CONDENSED INTERIM CASH FLOW STATEMENT

CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY NOTES TO THE CONDNSED INTERIM FINANCIAL STATEMENTS

Company Information

Board of Directors
Mr. Muhammad Ahsan	Chairman
Mr. Khurram Iftikhar	Chief Executive Officer
Mr. Shahzad Iftikhar
Mr. Nadeem Iftikhar
Mr. Suhail Maqsood Ahmed
Mr. Gul Muhammad Naz
Mrs.Bushra Bibi
Chief Financial Officer
Mr. Waheed Aslam
Company Secretary
Mr. Muhammad Raza Farooq
Audit Committee
Mr. Suhail Maqsood Ahmed	Chairman
Mr. Muhammad Ahsan
Mrs.Bushra Bibi
Human Resource & Remuneration Committee
Mr. Gul Muhammad Naz	Chairman
Mr. Suhail Maqsood Ahmed
Shahzad Iftikhar
Auditors
Zahid Jamil & Co.
Chartered Accountants
Legal Advisor
Mr. Aamir Nawaz Bhatti
Advocate High Court

Share Registrar Office

Vision Consulting Limited

3-C, LDA Flats, Lawrance Road, Lahore

Registered Office

P-225 Tikka Gali # 2 Montgomery Bazar, Faisalabad

Projects Locations

Punj Pullian Daewoo Road Faisalabad

Processing & Stitching Unit

Website

www.amtextile.com

DIRECTORS' REPORT

The Board of Directors of Amtex Limited presents herewith the Directors' Report together with the Company's un-audited financial information for the half year ended December 31, 2022.

Financial Results

The financial results for the period under review with comparative figures of previous period are presented hereunder.

	QUARTER ENDED		HALF YEAR ENDED
	DECEMBER 31		DECEMBER 31
	2022	2021	2022	2021
	RUPEES	RUPEES		RUPEES	RUPEES
Sales	323,711,635	299,180,974	679,068,236	584,040,227
Cost of sales	279,488,934	274,404,395	560,538,114	536,646,071
Gross profit	44,222,701	24,776,579	118,530,122	47,394,156
Other income	6,648,727	19,572,940	276,887,540	26,459,171
Net (loss) / profit for the period	(30,004,048)	(9,612,356)	259,761,792	(34,364,626)
Earnings per share - Basic and diluted	(0.12)	(0.04)	1.00	(0.13)

During 1st half under review company earned gross profit of Rs.118.53 million as compared to gross profit of Rs. 47.39 million in the corresponding period of last year and net profit of Rs. 259.76 million as compared to net loss of Rs. 34.36 million in the corresponding period of last year. Sales volume has also increased as compared to previous corresponding period and the company's total sales are Rs.679.06 million in six months against sales of Rs. 584.04 million in the corresponding period of last year.

As mentioned in Note 1.3 of these condensed interim financial statements that The Court Auctioneers in Execution Application filed by the Bank of Punjab auctioned the Company's Spinning Division's Land and Building at Rs.490 million. During the pendency of the execution petition, the Decree Holder bank, the Company as well as other first charge holder banks/financial institutions reached a negotiated deal and agreed to withdraw objection petitions on auction of land and building and also agreed for sale of Spinning Division's machinery to the Auction Purchaser (M/S Beacon Impex Private Limited) for Rs.315 million. Resultantly, the honorable court confirmed the auction and ordered for distribution of sale proceeds of Rs.490 million amongst first charge holder banks/financial institutions in proportion to the value of their charge. The entire sale proceeds of Land, Building and Machinery of Rs.805 million have been adjusted against the loans of the Company by the relevant banks / financial institutions. Other operating income of rupees 276.88 million includes an amount of Rs. 265.22 million gain on disposal of land, building and machinery of Company's Spinning Division.

Qualification in Auditors' Report to the Members

The auditors in review report has provided observation regarding company's ability to continue as going concern due to accumulated losses, liquidity issue, curtailed operational activities, pending litigations, disposal of spinning division, curtailment of employees and lease of its certain properties. Directors of the company explain that the management is making all efforts to continue operations and to run the entity as a going concern. Company's continuity of operations and consistency in sales volume since last couple of years despite global pandemic of Covid-19 clearly indicate that management's efforts and plans are effective. Moreover, the company is in process of selling certain properties and machinery, mortgaged with the banks, the entire such sale proceeds will be paid to relevant charge holder banks to reduce the debt burden and to settle the litigation with these banks. The management of the company has already taken steps for extension and restructuring of loans from certain banks and negotiations with other banks of the company are in process. In view of steps mentioned above, the management is confident that it will be successful in its efforts and hence the company will be able to continue as a going concern.

Certain banks / financial institutions have filed suit against the Company for recovery of its financing and mark up, therefore Company has not provided any markup / cost of funds on the outstanding amount as also stated in notes to the accounts. Based on the legal opinion, the Company feels that, after institution of the suit, bank/financial institution is only entitled to cost of funds if so awarded by the Court in case the suit is awarded against the company. The levy of cost of funds and the quantum thereof shall be contingent on passing of the decree and rate prescribed by the State Bank of Pakistan during the period of pendency of the claim and discharge of decree, if passed by the Court.

Future outlook

Textile Industry is the biggest source of earning dollars for Pakistan through its export oriented products, is in deep crisis at the moment. About seven million people associated with this industry have reportedly been laid off as it is on the verge of closure with many units already closed down whilst several others are planning to shift their production abroad. Undoubtedly, Pakistan's textile industry can again be brought back on the winning track if the government takes serious actions to remove or normalize the hurdles like high cost of doing business, poor law and order situation high inflation and shortage of energy. Lack of institutional financing is also adding to its problems. The exporters are doing their utmost to get out of this situation. As the foreign exchange reserves situation is likely to improve in the coming days, the government must sit with the textile industry and address their genuine problems, especially those relating to import of raw material. Management is well aware of the situation and tried best to maintain the increasing trend of exports volume and to settle litigations with banks in