Feroze1888 Mills : FML | Feroze1888 Mills Limited Transmission of Quarterly Report for the Period Ended 2023-09-30

Condensed Interim Financial Statements for the Quarter Ended September 30, 2023

CONTENTS

Company's information	02
Directors' Report (English & Urdu)	03 - 06
Statement of Financial Position	07
Statement of Profit or Loss	08
Statement of Comprehensive Income	09
Statement of Changes in Equity	10
Statement of Cash Flow	11
Notes to the Financial Information	12 - 17

For the quarter ended September 30, 2023 | 1

Company Information

Board of Directors

Mr. Abdul Rehman Yaqub	Chairman
Mr. Shabbir Ahmed	Non Executive Director
Mr. Khaleequr Rahman	Non Executive Director
Mr. Perwez Ahmed	Non Executive Director
Mr. Zain Ashraf Mukaty	Non Executive Director
Mr. Anas Rahman	Non Executive Director
Mr. Temoor Ashraf Mukaty	Non Executive Director
Mr. Moin M. Fudda	Independent Director
Ms. Huma Pasha	Independent Director
Ms. Aminah Zahid Zaheer	Independent Director
Mr. Rehan Rahman	Chief Executive Officer

Board Audit Committee

Mr. Moin M. Fudda	Chairman
Mr. Khaleequr Rehman	Member
Mr. Temoor Ashraf Mukaty	Member
Ms. Aminah Zahid Zaheer	Member

Board HR & Remuneration Committee

Ms. Aminah Zahid Zaheer	Chairperson
Mr. Moin M. Fudda	Member
Mr. Zain Ashraf Mukaty	Member

Chief Financial Officer

Ms. Javeria Siddiqui

Company Secretary

Mr. Mudassir Moten

Bankers

Allied Bank Limited

Bank Alfalah Limited

Bank Al Habib Limited

Bank Islami Pakistan Limited

Faysal Bank Limited

HBL Bank Limited

Habib Metropolitan Bank Limited

Meezan Bank Limited

Standard Chartered Bank (Pakistan) Ltd

External Auditors

EY Ford Rhodes Chartered Accountants

Progressive Plaza, Beaumont Road,

Karachi.

Internal Auditors

A.F. Ferguson & Co. Chartered Accountants

State Life Building No. 1-C, I.I. Chundrigar Road,

City Railway Colony, Karachi.

Registered Office

H-23/4A, Scheme # 3, Landhi Industrial Area, Landhi, Karachi.

Corporate Office

K&N Centre, 2nd and 3rd Floor,160 Banglore Town, Shahrah -e-Faisal, Karachi

Factory Addresses

Sindh:

Plot # H-23/4-A,H-23-/4-B,H-23/4-B1 and H- 23/3-II, Scheme # 3, Landhi Industrial Area, Landhi, Karachi. Plot # A-5/D and A-5/D1,B-4/A,C-3,C-31,F-125,F-342 & F-89, SITE, Karachi.

Plot # 342/A, Haroonabad, SITE, Karachi Plot # PL-15 & ST-03 North Karachi Industrial Area, Karachi.

Survey # 81, 242, 72 to 75, 165, 166, 171, 172, 176 to 181, 186 to 190, 156, 210, 211, 243

Deh Moachko, Tapo Gabopat, Keamari Town, Karachi.

Balochistan

Plot# D-12 to D-20,K-1 to K-3,M-30(Survey 564) and M-34 (Survey # 564, 84/1, 85, 86 & 89/1), HITE, Hub, Lasbela, Balochistan

Legal Advisor

Mohsin Tayebaly & Co

1st Floor, Dime Centre Khayaban-e-Iqbal,

Block-9, Clifton, Karachi

Share Registrar/Transfer Agent

FAMCO Associates (Pvt.) Ltd.

8-F, Next to Hotel Faran Nursery, Block-6, PECHS, Shahrah-e-Faisal, Karachi.

Website

http://www.feroze1888.com

For the quarter ended September 30, 2023 | 2

DIRECTORS' REPORT

We are pleased to present the performance review and the un-audited Financial Statements for the three months ended September 2023.

ECONOMIC & INDUSTRY OVERVIEW

Post nearly a stagnating economy in FY2023, it appears to be turning over a new leaf in FY2024. The IMF bailout in July allowed to avoid an impending default and helped in rebuilding foreign exchange reserves and unlock other multilateral funding.

The World Bank has revised downward Pakistan's GDP growth projection for the current fiscal year 2023-24 to 1.7 percent from a previous projection of 2 percent as the decline in economic activity reflects the accumulation of domestic and external shocks, domestic political uncertainty, tighter global financing, curb on imports and capital flows.

The Country is embarking on a tricky path to economic recovery. Inflation has consistently remained at elevated levels in double digits since last year. The rate accelerated to a high of 31.4% in September 2023 from 27.4% in the previous month, driven by high fuel and energy prices.

During the period, the Country earned US$ 4.13 billion from textile and apparel exports, compared to exports of US$ 4.58 billion in corresponding period last year. Specifically, exports of towel went up by 2.89% and were valued at US$ 244.13 million during the period July-September2023-24. On the other hand, the textile imports narrowed by 31.04 percent by falling from US$ 972.97 million dollars during July to September of the 2022-23 fiscal year to 670.95 million dollars during the same period of the current fiscal year. Raw cotton imports went down by 67.76% year-on-year to US$ 122.47 million on account of a normal crop season this year in contrast to a one devasted by floods, last summer.

REVIEW OF OPERATING RESULTS

A brief overview of the performance of your Company for the three months ended 30th September

2023 is stated below:

Statement of Profit or Loss for the three months ended:

	September 2023	September 2022
	-------- (Rupees in '000) --------
Sales- net	17,698,959	9,013,750
Gross profit	3,704,727	2,005,786
Profit before taxation	1,282,588	1,963,423
Profit after taxation	1,005,911	1,767,294
EPS (Rs/Share)	2.52	4.42

The Company's profit after tax for the three months has decreased by Rs. 761,383 million i.e. by 43% in comparison with the corresponding period of the last year even though the net sales have increased during the period by Rs. 8,685 billion i.e. 96%. The major reason for amplified profit in corresponding period LY was net exchange gain of approx. Rs. 1 billion as compared to a slight net exchange loss in this period.

For the quarter ended September 30, 2023 | 3

FUTURE OUTLOOK

Economic growth is expected to remain sluggish and downside risks to the outlook to remain exceptionally high. Even with the IMF Stand by Arrangement (SBA), reserves are expected to remain low, necessitating continued import controls and constraining economic recovery. The agriculture sector is though expected to recover on the back of higher production of important crops, including cotton and rice.

At Feroze1888, we remain committed to work together earnestly in steering the Company towards the accomplishment of its objectives while ensuring value creation for the stakeholders.

ACKNOWLEDGEMENT

We would like to take this opportunity to express our deep sense of gratitude to the shareholders, employees, customers and business partners for their cooperation, confidence and faith they have always reposed in the Company.

For and on behalf of the Board of Directors

Rehan Rahman	Abdul Rehman Yaqub
Chief Executive Officer	Chairman

Karachi

Date: October 30, 2023

For the quarter ended September 30, 2023 | 4

For the quarter ended September 30, 2023 | 5

For the quarter ended September 30, 2023 | 6

Feroze1888 Mills Limited

Condensed Interim Statement of Financial Position

As at September 30, 2023

Note

ASSETS

Non-current assets

Un-audited	Audited
September 30,	June 30,
2023	2023

-------- (Rupees in '000) --------

Property, plant and equipment	4
Intangible assets
Long term deposits
Current assets
Store and spares
Stock-in-trade	5
Trade debts	6
Advances, deposits, prepayments and other receivables
Taxation - net
Short-term investments	7
Cash and bank balances
Total assets
EQUITY AND LIABILITIES
Share capital and reserves
Authorised share capital
400,000,000 (June 30, 2023: 400,000,000) ordinary shares of Rs.10 each
Issued, subscribed and paid-up capital
Capital reserves
Revaluation surplus on property, plant and equipment
Revenue reserve
Liabilities
Non-current liabilities
Deferred liability
Long term financing	8
Provision for GIDC
Lease liabilities
Current liabilities
Trade and other payables	9
Short term borrowings	10
Accrued mark-up
Current portion of lease liabilities
Current portion of long term financing	8
Unclaimed dividend
CONTINGENCIES AND COMMITMENTS	11

34,727,207

21,492

89,980

34,838,679

2,277,964

19,511,845

17,144,641

4,713,758

352,081

75,305

711,393

44,786,987

79,625,666

4,000,000

3,994,090

2,115,146

3,010,172

28,572,385

37,691,793

1,498,071

7,352,487

1,334,357

403,160

10,588,075

11,915,822

17,076,089

433,931

235,425

1,682,376

2,155

31,345,798

33,939,059

11,533

87,024

34,037,616

1,789,066

15,449,584

14,389,492

6,222,042

455,780

4,362,587

1,336,630

44,005,181

78,042,797

4,000,000

3,994,090

2,115,146

3,010,172

27,566,474

36,685,882

1,427,225

7,839,253

1,334,357

455,578

11,056,413

11,993,765

15,900,000

670,983

240,380

1,493,196

2,178

30,300,502

Total equity and liabilities

79,625,666 78,042,797

The annexed notes 1 to 21 form an integral part of these condensed interim financial statements.

Javeria Siddiqui	Rehan Rahman	Abdul Rehman Yaqub
Chief Financial Officer	Chief Executive Officer	Chairman

For the quarter ended September 30, 2023 | 7

Feroze1888 Mills Limited

Condensed Interim Statement of Profit or Loss (Un-audited)

For the Quarter ended September 30, 2023

	Quarter Ended
	September 30,	September 30,
	2023	2022
Note	-------------- (Rupees in '000) --------------

Sales - net		17,698,959
Cost of sales	12	(13,994,232)
Gross profit		3,704,727
Administrative cost		(349,040)
Distribution cost		(1,292,543)
Other expenses	13	(144,042)
		(1,785,625)
		1,919,102
Other income	14	178,271
Operating profit		2,097,373
Finance cost		(814,785)
Profit before taxation		1,282,588
Taxation		(276,677)
Profit after taxation		1,005,911

9,013,750

(7,007,964)

2,005,786

(218,208)

(766,496)

(105,372)

(1,090,076)

915,710

1,338,391

2,254,101

(290,678)

1,963,423

(196,129)

1,767,294

Earning per share basic & diluted (Rupees)	2.52	4.42

The annexed notes 1 to 21 form an integral part of these condensed interim financial statements.

Javeria Siddiqui	Rehan Rahman	Abdul Rehman Yaqub
Chief Financial Officer	Chief Executive Officer	Chairman

For the quarter ended September 30, 2023 | 8

Feroze1888 Mills Limited

Condensed Interim Statement of Comprehensive Income (Un-audited)

For the Quarter ended September 30, 2023

	Quarter Ended
	September 30,		September 30,
	2023	2022
	-------------- (Rupees in '000) --------------
Profit after taxation	1,005,911	1,767,294
Other comprehensive income	-	-
Total comprehensive income for the period
1,005,911	1,767,294

The annexed notes 1 to 21 form an integral part of these condensed interim financial statements.

Javeria Siddiqui	Rehan Rahman	Abdul Rehman Yaqub
Chief Financial Officer	Chief Executive Officer	Chairman

For the quarter ended September 30, 2023 | 9