Equity Two : Interim Financials 31 Dec 2022

EQUITY TWO PLC

A Carson Cumberbatch Company

Condensed Interim Financial Statements

For the nine months ended 31st December 2022

Equity Two PLC

Statement of Profit or Loss and Other Comprehensive Income

(All figures are in Sri Lankan Rupees Thousands)

	Three months ended		Nine months ended
	31st December		31st December
	2022	2021	Change %		2022	2021	Change %
Revenue	37,151	33,281	12	106,245	99,836	6
Direct costs	(15,410)	(10,463)	47	(38,904)	(30,149)	29
	21,741	22,818	(5)	67,341	69,687	(3)
Other income	218	158	38	540	428	26
Administrative and other operating expenses	(5,553)	(2,261)	146	(11,492)	(5,893)	95
Results from operating activities	16,406	20,715	(21)	56,389	64,222	(12)
Finance income	8,831	2,467	258	18,717	6,131	205
Finance costs	(2,152)	(1,038)	107	(4,289)	(3,026)	42
Net finance income	6,679	1,429	367	14,428	3,105	365
Profit before taxation	23,085	22,144	4	70,817	67,327	5
Income tax expense	(6,693)	(4,691)	43	(17,269)	(14,118)	22
Deferred taxation	(74,770)	(855)	8,645	(76,512)	(2,556)	2,893
Profit/ (loss) for the period	(58,378)	16,598	(452)	(22,964)	50,653	(145)
Other comprehensive income / (expense)
Items that will never be reclassified into profit and loss
Actuarial gain / (loss) from valuation of employee
benefits	-	-	-	-	-	-
Related tax	-	-	-	-	-	-
Total other comprehensive income / (expense) for	-	-	-	-	-	-
the period
Total comprehensive income/ (expense) for the
period	(58,378)	16,598	(452)	(22,964)	50,653	(145)
Earnings per share (Rs.)	(1.88)	0.54		(0.74)	1.63
Dividend per share (Rs.)	-	-		-	-

Change % represents the percentage change in the current period's results compared to the corresponding period of the previous year.

Figures in brackets indicate deductions.

Equity Two PLC

Statement of Financial Position

(All figures are in Sri Lankan Rupees Thousands)

		31.03.2022
As at	31.12.2022	(Audited)
ASSETS
Non-current assets
Investment properties	1,575,840	1,570,418
Investment in fixed deposits	168,353	-
Total non-current assets	1,744,193	1,570,418
Current assets
Trade and other receivables	28,403	28,333
Fair value through profit or loss financial assets	2,409	43,719
Investment in fixed deposits	37,502	74,681
Cash and cash equivalents	83,395	76,612
Total current assets	151,709	223,345
Total assets	1,895,902	1,793,763
EQUITY AND LIABILITIES
Equity
Stated capital	444,092	444,092
Capital reserves	750	750
Revenue reserves	957,374	998,516
Total equity	1,402,216	1,443,358
Non-current liabilities
Refundable rental deposits	57,597	46,183
Deferred tax liability	368,736	292,224
Employee benefits	1,371	1,285
Total non-current liabilities	427,704	339,692
Current liabilities
Trade and other payables	9,528	4,148
Deferred revenue	5,263	4,778
Loans and borrowings	50,807	-
Current tax liabilities	384	1,787
Total current liabilities	65,982	10,713
Total liabilities	493,686	350,405
Total equity and liabilities	1,895,902	1,793,763
Net assets per share (Rs.)	45.23	46.56

The Statement of Financial Position as at 31st December 2022 and the related Statements of Profit or Loss and Other Comprehensive Income, Changes in Equity and Cash Flows for the period then ended as disclosed in pages 1 to 4 have been drawn up from unaudited financial statements.

I certify that these financial statements are in compliance with the requirements of Companies Act, No. 7 of 2007.

(Sgd).

V.R. Wijesinghe

Director - Finance

Carsons Management Services (Private) Limited

The Board of Directors is responsible for the preparation and presentation of these financial statements.

Approved and signed on behalf of the managers,	Approved and signed on behalf of the board,
(Sgd).	(Sgd).	(Sgd).
A.P. Weeratunge	D.C.R. Gunawardena	K.C.N. Fernando
Director	Chairman	Director
Carsons Management Services (Private) Limited

Colombo

10th February 2023

Equity Two PLC

Statement of Changes in Equity

(All figures are in Sri Lankan Rupees Thousands)

	Stated	Capital	Revenue	Total
	capital	reserves	reserves	equity
Balance as at 01st April 2022	444,092	750	998,516	1,443,358
Surcharge tax for the year of assessment 2020/21*	-	-	(18,178)	(18,178)
Balance as at 01st April 2022 (Adjusted)	444,092	750	980,338	1,425,180
Loss for the period	-	-	(22,964)	(22,964)
Other comprehensive income for the period	-	-	-	-
Total comprehensive income/ (expense) for the period	-	-	(22,964)	(22,964)
Balance as at 31st December 2022	444,092	750	957,374	1,402,216
Balance as at 01st April 2021	444,092	750	913,522	1,358,364
Profit for the period	-	-	50,653	50,653
Other comprehensive income for the period	-	-	-	-
Total comprehensive income for the period	-	-	50,653	50,653
Balance as at 31st December 2021	444,092	750	964,175	1,409,017

Figures in brackets indicate deductions.

• As per the provisions of Surcharge Tax Act No. 14 of 2022, although the Company did not become liable to pay surcharge tax as a stand-alone entity, the Company was liable for surcharge tax on the basis that the Company is part of the Carson Cumberbatch PLC group, of which the aggregate taxable income exceeded the threshold as stipulated in the aforesaid Act.

Accordingly, the Company was liable for a surcharge tax of Rs. 18,177,642/- out of the taxable income of Rs. 72,710,566/- pertaining to the year of assessment 2020/21. The Company paid the surcharge tax liability in two equal installments on 18th April 2022 and 18th July 2022.

The expense of surcharge tax is accounted in accordance with the "Addendum to Statement of Alternative Treatment on Accounting for Surcharge Tax levied under the Surcharge Tax Act No. 14 of 2022 " issued by the Institute of Chartered Accountants of Sri Lanka on 10th August 2022.

Equity Two PLC

Statement of Cash Flows

(All figures are in Sri Lankan Rupees Thousands)

Nine months ended 31st December	2022	2021
Cash flows from operating activities	70,817
Profit before taxation	67,327
Adjustments for:	4,289
Finance costs	3,026
Finance income	(15,450)	(5,769)
Net change in fair value through profit or loss financial assets	(3,267)	(362)
Provision for employee benefits	86	86
Amortization of deferred revenue	(3,227)	(2,963)
Operating profit before working capital changes	53,248	61,345
(Increase) / decrease in trade and other receivables	(70)	4,955
Increase / (decrease) in trade and other payables	5,523	(18,412)
Operating profit after working capital changes	58,701	47,888
Rental deposits received	11,644	435
Income tax paid	(18,672)	(17,306)
Surcharge tax paid	(18,178)	-
Net cash generated from / (used in) operating activities	33,495	31,017
Cash flows from investing activities	(5,422)
Additions to investment properties	(2,455)
Redemption of / (investment in) fair value through profit or loss financial assets	44,577	(2,203)
Withdrawal of / (investment in) fixed deposits	(124,301)	78,447
Withdrawal of / (investment in) securities purchased under resale agreements	-	(26,200)
Interest received	8,577	6,290
Net cash generated from / (used in) investing activities	(76,569)	53,879
Cash flows from financing activities	(143)
Dividend paid	(112)
Loans obtained	50,000	-
Net cash generated from / (used in) financing activities	49,857	(112)
Net increase / (decrease) in cash and cash equivalents	6,783	84,784
Cash and cash equivalents at the beginning of the period	76,612	6,739
Cash and cash equivalents at the end of the period	83,395	91,523
Statement of cash and cash equivalents
Cash at bank and in hand	79,721	9,008
Investment in treasury bills	-	9,955
Placements with banking and financial institutions	3,674	72,560
Cash and cash equivalents for the cash flow statement purposes	83,395	91,523

Figures in brackets indicate deductions.