Bestway Cement : Transmission of Quarterly Report for the Period Ended September 30, 2022

CONTENTS

Company Information	1
Directors' Report	3
Condensed Interim Statement of Financial Position	5
Condensed Interim Statement of Profit or Loss (Un-audited)	7
Condensed Interim Statement of Profit or Loss and other	8
Comprehensive Income (Un-audited)
Condensed Interim Statement of Changes in Equity	9
Condensed Interim Statement of Cash Flows (Un-audited)	10
Notes to the Condensed Interim Financial Statements	11
(Un-audited)
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COMPANY INFORMATION

Mianwali

Main Kalabagh Road,

Dhair Umaid Ali Shah Pakka,

Tehsil & District Mianwali,

Punjab, Pakistan.

Email: [e-mail]

Nomination Committee

Lord Zameer Choudrey

Mr. Muhammad Irfan Anwar Sheikh

Mr. Haider Zameer Choudrey

Risk Management Committee

Lord Zameer Choudrey

Mr. Muhammad Irfan Anwar Sheikh

Mr. Haider Zameer Choudrey

Hassan Niazi

Bank of Khyber

Bank of Punjab

DIRECTORS' REPORT

The Board of Directors take pleasure in presenting their report together with unaudited financial statements for the quarter ended 30 September 2022.

Industry Overview

Domestic cement dispatches decreased by 24% to 8.6 million tonnes from 11.3 million in the same quarter of last year. Export volumes declined by 32% from 1.5 million tonnes to 1.02 million tonnes. Overall, dispatches by the industry decrease by 25% from

12.9 million tonnes to 9.6 million tonnes for the period under review. The decrease in both domestic and export sales volumes was primarily driven by sharp increase in fuel and energy prices exacerbated by Russia- Ukraine war. Economic instability, political uncertainty and the recent floods within the country further dented consumer confidence resulting in decline in cement consumption.

Production and Sales Review	Quarter ended 30	Quarter ended 30	Increase/	Percentage
		September 2022	September 2021	(Decrease)
		Tonnes	Tonnes	Tonnes	%
Clinker production	1,321,364	1,778,362	(456,998)	(26%)
Cement production	1,440,949	1,908,391	(467,442)	(24%)
Cement and Xtreme Bond sales	1,421,449	1,922,623	(501,174)	(26%

Your Company's total cement dispatches showed a decline of 26% mainly due to reduction in local sales volumes. This was driven by the factors explained above.

Despite fierce competition, Bestway successfully retained its position as one of the largest cement producers and the market leader in the country

Operating Highlights

The Company recorded gross turnover of Rs. 25.4 billion in the quarter ended 30 September 2022, 14% higher compared with Rs. 22.3 billion during the same quarter of last year. Net turnover for the quarter increased by 21%, from Rs. 15.4 billion to Rs. 18.6 billion. Higher revenue was driven by increase in selling prices which was necessitated by an exorbitant increase in the input costs.

Gross profit for the quarter was reported at Rs. 6.1 billion as compared with Rs. 4.6 billion during the same quarter of last year.

Financial charges Increased to Rs. 0.9 billion for the quarter as against Rs. 0.3 billion for the same quarter of last year. This increase is due to increase in working capital requirements, higher interest rates and borrowings for new projects.

Profit before tax amounted to Rs. 4.8 billion as compared to Rs. 4.1 billion for the quarter ended 30 September 2021. Profit after taxation for the quarter amounted to Rs. 3.3 billion as compared to Rs. 3.0 billion for the same quarter of last year.

Earnings per share of the Company for the quarter stood at Rs. 5.55 as against Rs. 5.02 for the same quarter of last year.

Plants' Performance

Your Company's management follows an elaborate plan of preventative maintenance, which it has adopted right from the beginning. This proactive approach ensures efficient and stable operations with minimum disruptions. Our well-knit team of dedicated managers, engineers, technicians and other members of management and administrative staff play a key role in the successful implementationof this plan. During the period under review, all our cement plants and the waste heat recovery plants operated satisfactorily.

Alternative Energy Initiatives

Cement manufacturing is an energy-intensive process. Power represents one of the largest costs of production. Persistent power crisis in the country necessitated a shift from conventional fossil fuels to alternate energy solutions. As part of its strategy to reduce its reliance on the national grid, your Company has set up Waste Heat Recovery Power Plant (WHRPP) at all four sites Chakwal, Hattar, Farooqia and Kallar Kahar. Bestway's WHRPP at Chakwal was the first in the cement industry of Pakistan prompting others to follow suit.

This is an important step in energy conservation for your Company, making it a forerunner in adopting Waste Heat Recovery (WHR) technology at all its operations. These projects serve to significantly reduce the Company's dependence on external source of electricity thus helping in reduction of production costs, improving operational efficiency and protecting the environment. During the period under review, your Company met 45% of its energy requirement through WHRPP, boilers and Solar.

Solar Power Generation

Building on the legacy of being an environmentally conscious Company, you will be delighted to know that our solar power plants at all four locations are now fully operational. Our total capacity of 56.6 MWs is the largest distributed captive power generation capacity to date, not only in Pakistan but in the entire region. Your Company intends to enhance its solar power generation capacity at all four plants in the near future.

The solar power generation has not only reduced your Company's reliance on the national grid further but has also enabled it to reduce its carbon foot print by more than 3.5 million Tonnes of CO2 emissions over the life of the project, which is equal to plantation of approximately 5.5 million trees.

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