Ceylon Tea Brokers : Annual Report 2021/2022

Ceylon Tea Brokers PLC

Annual Report 2021/22

Contents

OVERVIEW

Introduction to the Report

Who We Are

Milestones

Financial Highlights

Non-Financial Highlights

LEADERSHIP & STRATEGY

Chairman's Message

Chief Executive Officer's Review

Board of Directors

Corporate Management

Our Strategy

MANAGEMENT DISCUSSION & ANALYSIS

Operating Landscape

Our Business Model

Stakeholder Relationships and Materiality

Capital Management Reports

• Financial Capital
• Manufactured Capital
• Human Capital
• Intellectual Capital
• Natural Capital
• Social and Relationship Capital
• Digital Capital

Operational Performance Review

Our Approach to Sustainability

Outlook

	GOVERNANCE REPORTS
02	Chairman's Statement on Corporate Governance	63
03	Corporate Governance	64
04		Report of the Audit Committee	69
06		Report of Related Party Transactions Review Committee	71
08		Report of the Risk Management Committee	72
		Report of the Remuneration Committee	73
10		Report of the Nomination Committee	74
	Directors' Statement on Internal Controls	75
16
	Summary of Compliance	76
18
Annual Report of the Board of Directors
22
on the Affairs of the Company	90
24	Risk Management	93

	FINANCIAL REPORTS
26	Financial Calendar	100
34	Statement on Director's Responsibilities for
36	Preparation of Financial Statements	101
41	Independent Auditor's Report	102
41	Consolidated Statement of Profit or Loss and
45	Other Comprehensive Income	106
Consolidated Statement of Financial Position	107
46
Consolidated Statement of Changes in Equity	108
51
Consolidated Statement of Cash Flows	109
52
Noted to the Consolidated Financial Statements	110
54
56
SUPPLEMENTARY INFORMATION
58
Investor Relations	161
60
GRI Content Index	164
62
Notice of the Annual General Meeting	168
	Notes	169
	Form of Proxy	171
	Corporate Information	IBC

This Annual Report is published within three months of the date of the Consolidated Statement of Financial Position. The web version is also published online on the same date as the date of issue of this Annual Report at www.ceylonteabrokers.com/key-financials

When considering the future growth of a company, there is much to assess in terms of our collective aspirations while also weighing in on the opportunity cost of making those dreams a reality. While the year under review laid an obstacle course for progress, we were undeterred and chose to take a more holistic look at how we do business.

In creating a more prudent game plan for our long term growth and existence, we have built on Sustainability, balancing our accountability and goals along with our progression in order to stabilise our journey in the time ahead.

OVERVIEW		GRI 2016: 102-45,102-46,102-48,102-49,102-50,102-51,102-52,102-53,102-54

Introduction to the Report

We are pleased to present our fourth Integrated Report in accordance with the International Framework of the International Integrated Reporting Council (IIRC). This report consists of both financial and non-financial disclosures regarding our economic, social, and environmental performance for the year 2021/22 and future outlook.

Our vision is to be a dynamic and leading service organisation, which we aim to achieve through stakeholder engagement, reducing our environmental impact, developing our people, and creating sustainable value through our business model. Our annual report (hereinafter referred to as the 'report') demonstrates our continued commitment to conducting business in a responsible and sustainable manner. Our focus is on creating sustainable value in our economy, society and environment.

This report consists of both financial and non-financial reporting disclosures regarding our economic, social and environmental performance for the year 2021/22 and future outlook.

Reporting Scope and Boundaries The contents of this report relate to the operations of Ceylon Tea Brokers PLC "Company" including its fully owned subsidiary, Logicare (Pvt) Ltd. collectively referred to as "Group". The Company does not have any other subsidiaries, associates, joint ventures, overseas operations or other businesses for the purpose of reporting except for Logicare (Pvt) Ltd. The Company's shareholding structure, operations and its geographical presence are disclosed on page 03 and 162 respectively.

Non-financial information presented in this report refers to the Group unless explicitly stated.

The Group voluntarily adopted GRI sustainability reporting standards and UN Sustainable Development Goals and a self- assessment of impact is reported in this Integrated Annual Report.

Reporting Framework

Financial reporting

1. The Sri Lanka Financial Reporting Standards (SLFRS) and Sri Lanka Accounting Standards (LKAS) issued by the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka)

Corporate governance reporting

1. Laws and Regulations of the Companies Act No. 7 of 2007.

1. Listing Rules of the Colombo Stock Exchange.

1. Code of Best Practices on Corporate Governance issued jointly by CA Sri Lanka & Securities and Exchange Commission of Sri Lanka.

Integrated reporting

1. International Integrated Reporting (IIR) Framework issued by the International Integrated Reporting Council (IIRC)

Sustainability reporting

1. GRI Sustainability Reporting Standards 2016

1. UNGC Principles and UN Sustainable Development Goals

Reporting Cycle

The Annual Report 2021/22 of Ceylon Tea Brokers PLC reports for the 12 months period from 1st April 2021 to 31st March 2022. This period is consistent with the Company's usual annual reporting cycle.

Determining Materiality

Materiality analysis is a key process that enables the Company to define key triple bottom line issues that are vital to our business and stakeholders, both internal and external. Our focus on materiality is based on material aspects recognised by both internal and external stakeholders. This process is crucial to drive performance, improve our sustainability framework and use the corporate governance practices at all levels of the Group.

The Company conducts regular external stakeholder engagement in ascertaining aspects material to its significant stakeholders. In addition, materiality is also assessed internally in ascertaining the aspects material to the Company and to fine-tune and streamline its strategy and processes to manage these material issues.

Restatements and Significant Changes from the Previous Report and Date of Most Recent Previous Report

The Company's most recent report was for the financial year 2020/21. There have not been any changes in reporting scope and/or boundaries from the previous year. The Company has restated numbers and statements of 2020/21 wherever necessary, to conform to the current year's presentations.

Disclaimer on Forecasts

The report contains details about business plans and strategies of the Group. These represent the management's views which are unaudited, and forward-looking in nature. As the outcomes of such forecasts are subject to external conditions, there could be deviations from the projections.

Feedback and Further Information and Suggestions

The Company has strived to respond to your comments and suggestions which were received during the previous financial year and welcome your comments and suggestions on this Report.

Contact Us

Mr. Nishantha Adhikari

Financial Controller

Ceylon Tea Brokers PLC

Level 7, 'Millennium House'

46/58, Nawam Mawatha

Colombo 02.

Sri Lanka.

02

Ceylon Tea Brokers PLC

Annual Report 2021/22

OVERVIEW

Who We Are

GRI 2016: 102-2,102-3,102-4,102-6,102-16

The first stand-alone Tea broking Company to be listed on the Colombo Stock Exchange. Today we are one of the well-respected entities in the field, having achieved considerable growth in a short period of time. Proudly holding our own identity and competing against the might of long-established broking firms, we continue to grow in strength and stature supported by a solid management team. Commitment, experience, and expertise being our guiding principles, our success is driven by a team of talented young people, whose enthusiasm, agility and know-how has marked them out as some of the best in the trade. This reinforced the growth and maintained the momentum even during a world pandemic.

Currently we handle produce of over 170 Tea factories in the country which amounts to around 15.42% of the total volumes sold at the Colombo Tea Auction. Having earned the confidence of our clients, we continue to strengthen our relationships with them, while actively venturing out to gain and secure new ones to further our progress in the future.

Business Activities / Key Service Areas We are a licensed Produce Broker for

Tea registered under Sri Lanka Tea Board bearing License No. PB/102/2022.

Tea Broking / Marketing

Act as an intermediary between Tea Producers and Tea Buyers.

Warehousing

Providing warehousing solutions to the producer clients (Tea Factories) for their Teas pending for sale.

Manufacturing Advisory Services Provided manufacturing advise and personalised services to producer clients (Tea Factories) in order to improve their product quality.

Financing

Provide financing facilities in the form of loans and advances to producer clients (Tea Factories) to meet their working capital requirements.

Market Served

The factories whose Teas are marketed through us cover all elevations namely Uva High, Uva Medium, Western High, Western Medium and Low Grown.

Where We Operate

Ceylon Tea Brokers PLC

Head Office

Level 7, 'Millennium House', 46/58, Nawam Mawatha, Colombo 02, Sri Lanka.

Sample Room

No. 74, De Waas Lane, Grandpass,

Colombo 14, Sri Lanka.

Warehouses

1. No. 74, De Waas Lane, Grandpass, Colombo 14, Sri Lanka.

1. No. 885F, Duwawaththa Road, Kotikawaththa, Angoda, Sri Lanka.

1. No. 26, Welikadamulla Road, Enderamulla, Wattala, Sri Lanka.

Logicare (Private) Limited

A wholly owned subsidiary of Ceylon Tea Brokers PLC which is providing transportation and warehousing facilities to the third party logistic clients.

Head Office

Level 7, 'Millennium House', 46/58, Nawam Mawatha, Colombo 02, Sri Lanka.

Warehouse

1. No. 1, Muthurajawela Road, Muthurajawela, Sri Lanka.

1. No. 205, Awariwatta Road, Wattala, Sri Lanka.

The first stand-alone Tea broking Company to be listed on the Colombo

Stock Exchange. Today we are one of the well-respected entities in the field, having achieved considerable growth in a short period of time. Proudly holding our own identity and competing against the might of long-established broking firms, we continue to grow in strength and stature supported by a solid management team.

Annual Report 2021/22

Ceylon Tea Brokers PLC

03