First Capital : Provisional Financial Statements for the Quarter ended 31st December 2022

PROVISIONAL FINANCIAL STATEMENTS

Quarter ended

31 December 2022

FIRST CAPITAL HOLDINGS PLC

REVIEW OF OPERATIONS

First Capital Holdings PLC (the Group) recorded a Profit after Tax of Rs. 1.66Bn for the nine months ended 31 December 2022 compared to Loss after Tax of Rs. 68Mn in the corresponding period of the previous year.

The Primary Dealer division reported a Profit after Tax of Rs. 1.9Bn for the nine months ended 31 December 2022 (2021/22 - Loss after Tax of Rs. 361Mn). The Results include net interest income of Rs. 2,152Mn and a trading gain on sale of government securities amounting to Rs. 572Mn (2021/22 - Net interest income of Rs. 357Mn and a trading loss of Rs. 809Mn was recorded).

As of 31 December 2022, the Business division's Held to Maturity portfolio reflected a fair valuation loss of Rs. 1.15Bn which is not accounted for in the provisional financial statements since the amortised cost basis is adopted in valuing the said investment as per the accounting standard on financial instruments (SLFRS 9).

We are operating in a challenging business environment due to the prevailing economic conditions. The impact of a potential local debt restructuring is also a continuing concern.

The Corporate Finance and Dealing Securities division reported a Loss after Tax of Rs. 364Mn for the nine months ended 31 December 2022 (2021/22 - Profit after Tax of Rs. 47Mn). Fair valuation loss on dealing securities amounting to Rs. 210Mn mainly resulted in the Loss for the period under review.

The Wealth Management division reported a Profit after Tax of Rs. 22Mn for the nine months ended 31 December 2022 (2021/22 - Rs. 77Mn). The assets under management of the division stood at Rs. 36Bn as of 31 December 2022 (31 March 2022 - Rs. 41.2Bn).

The Stock Brokering division recorded a Profit after Tax of Rs. 98Mn for the nine months ended 31 December 2022 (2021/22 - Rs. 176Mn).

First Capital Holdings PLC and First Capital Treasuries PLC (subsidiary) were awarded a rating of "A" with stable outlook by Lanka Rating Agency (LRA) in December 2022.

The tragic demise of Dinesh Schaffter who served as First Capital's Managing Director since 2014 prompted appointments to further strengthen the Board of Directors/Senior Management, including the appointment of Manjula Mathews as the Deputy Chairperson and myself as Managing Director/CEO.

Dinesh's vision and contribution towards the success of First Capital Group as well as the capital markets industry of Sri Lankan are deeply appreciated and we continue to move forward with our "Performance First" mindset to honour his legacy.

(Sgd.)

Dilshan Wirasekara

Managing Director/CEO

Provisional Financial Statements	FIRST CAPITAL HOLDINGS PLC
Quarter ended 31 December 2022
1

CONSOLIDAED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

For the period

Notes

Income
Direct income
Direct expenses
Net trading income/(expense)
Other income	1
Gain on fair valuation of financial assets recognised through profit or loss
measured at fair value
Operating expenses
Administrative expenses
Sales and distribution expenses
Other operating expenses
(Provision)/ Reversal for impairment of financial assets at amortised cost
Profit/ (Loss) before tax
Income tax (expense)/ reversal	2
Profit/ (Loss) for the period
Other comprehensive income
Items that will never be reclassified to profit or loss
Items that are or may be reclassified to profit or loss
Other comprehensive income for the period
Total comprehensive income/ (loss) for the period
Profit/ (Loss) attributable to:
Equity holders of the parent
Non - controlling interest
Total comprehensive income/ (loss) attributable to:
Equity holders of the parent
Non - controlling interest
Basic earnings/ (loss) per share (Rs.)	3
Figures in bracket indicate deductions.
Note: All values are in Rupees '000 unless otherwise stated.

Group

October ~ December		April ~ December
2022	2021	2022	2021
(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)
4,365,511	373,469	9,960,551	1,434,780
4,323,184	347,598	9,830,134	1,322,997
(2,659,050)	(397,736)	(6,734,491)	(1,303,355)
1,664,134	(50,138)	3,095,643	19,642
42,327	25,871	130,417	111,783
97,656	337,069	162,309	144,244
1,804,117	312,802	3,388,369	275,669
(222,166)	(163,318)	(494,603)	(404,281)
(4,236)	(5,571)	(11,984)	(15,263)
(238,421)	(27,558)	(452,116)	(58,209)
(6,006)	2,134	(24,177)	4,404
(470,829)	(194,313)	(982,880)	(473,349)
1,333,288	118,489	2,405,489	(197,680)
(495,001)	116,087	(744,058)	129,158
838,287	234,576	1,661,431	(68,522)
-	-	-	-
-	-	-	-
-	-	-	-
838,287	234,576	1,661,431	(68,522)
753,322	229,655	1,459,663	(51,063)
84,965	4,921	201,768	(17,459)
838,287	234,576	1,661,431	(68,522)
753,322	229,655	1,459,663	(51,063)
84,965	4,921	201,768	(17,459)
838,287	234,576	1,661,431	(68,522)
1.86	0.57	3.60	(0.13)

Provisional Financial Statements	FIRST CAPITAL HOLDINGS PLC
Quarter ended 31 December 2022
2

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

Company

For the periodOctober ~ December April ~ December Notes

2022 2021 2022 2021 (Unaudited) (Unaudited) (Unaudited) (Unaudited)

Income		1,121,047	237,826	2,704,084	708,842
Direct income		1,121,047	237,826	2,704,084	708,826
Direct expenses		(886,780)	(197,367)	(2,136,535)	(565,948)
Net trading income		234,267	40,459	567,549	142,878
Other income	1	-	-	-	16
Gain/ (loss) on fair valuation of financial assets recognised through profit		6,879	38,863	(203,897)	(16,287)
or loss measured at fair value
		241,146	79,322	363,652	126,607
Operating expenses
Administrative expenses		(15,072)	(13,873)	(53,570)	(45,271)
Sales and distribution expenses		(770)	2,975	(1,751)	(599)
Other operating expenses		(36,839)	(4,855)	(83,785)	(21,507)
(Provision)/ reversal for impairment of financial assets at amortised cost		592	(2,924)	962	(1,649)
		(52,089)	(18,677)	(138,144)	(69,026)
Operating profit		189,057	60,645	225,508	57,581
Share of profit/ (loss) from equity accounted investee (net of tax)		638,193	261,184	1,328,816	(12,447)
Profit before tax		827,250	321,829	1,554,324	45,134
Income tax expense	2	(67,774)	(15,029)	(88,507)	(19,052)
Profit for the period		759,476	306,800	1,465,817	26,082
Other comprehensive income
Items that will never be reclassified to profit or loss		-	-	-	-
Items that are or may be reclassified to profit or loss		-	-	-	-
Other comprehensive income for the period		-	-	-	-
Total comprehensive income for the period		759,476	306,800	1,465,817	26,082
Basic earnings per share (Rs.)	3	1.88	0.76	3.62	0.06
Figures in bracket indicate deductions.
Note: All values are in Rupees '000 unless otherwise stated.

Provisional Financial Statements	FIRST CAPITAL HOLDINGS PLC
Quarter ended 31 December 2022
3

CONSOLIDATE STATEMENT OF FINANCIAL POSITION

	Group		Company
As at	31 December		31 March	31 December	31 March
	2022		2022	2022	2022
	(Unaudited)		(Audited)	(Unaudited)	(Audited)
ASSETS
Cash at banks and in hand	112,189		526,987	19,692	39,417
Derivative financial instruments	20,412		5,190	-	-
Financial assets recognised through profit or loss -measured at	46,344,709		30,066,729	1,756,625	3,220,443
fair value
Financial assets - fair value through other comprehensive	34,635		34,635	-	-
income
Financial assets at amortised cost	20,497,879		9,059,275	11,461,507	8,784,857
Amounts due from related companies	272		750	32,796	8,473
Trade and other receivables	1,279,230		1,423,170	13,437	10,161
Non - current assets held for sale	42,416		42,416	-	-
Taxes receivable	15,204		72,126	-	56,811
Investment in subsidiary	-		-	4,461,498	3,482,855
Deferred tax asset	50,411		122,497	1,253	986
Property, plant and equipment and right of use assets	29,453		38,322	16,946	17,437
Intangible assets	119,938		122,532	3,379	5,281
TOTAL ASSETS	68,546,748		41,514,629	17,767,133	15,626,721
LIABILITIES
Bank overdrafts	1,150,295		1,245,741	1,149,644	1,245,696
Derivative financial instruments	277,512		2,622	-	-
Securities sold under re-purchase agreements	47,702,437		23,799,838	-	-
Short term borrowings	8,178,692		8,139,888	8,306,887	8,250,158
Amounts due to related companies	7,660		5,571	2,485	2,096
Trade and other payables	998,524		959,271	55,262	47,543
Taxes payable	609,001		78,132	31,963	-
Long term borrowings	902,454		-	902,454	-
Retirement benefit obligations	49,262		37,404	-	-
Borrowings on debentures	2,953,615		2,780,890	2,180,859	2,030,553
TOTAL LIABILITIES	62,829,452		37,049,357	12,629,554	11,576,046
EQUITY
Stated capital	227,500		227,500	227,500	227,500
Risk reserve	1,410,154		1,239,478	1,410,154	1,239,478
Retained earnings	3,797,881		2,881,654	3,797,881	2,881,654
Fair valuation reserve	(297,956)		(297,957)	(297,956)	(297,957)
Equity attributable to the equity holders of the parent	5,137,579		4,050,675	5,137,579	4,050,675
Non- controlling interest	579,717		414,597	-	-
TOTAL EQUITY	5,717,296		4,465,272	5,137,579	4,050,675
TOTAL EQUITY AND LIABILITIES	68,546,748		41,514,629	17,767,133	15,626,721
Net asset per share (Rs.)	12.69		10.00	12.69	10.00
Note: All values are in Rupees '000 unless otherwise stated.

These consolidated financial statements are in compliance with the requirements of the Companies Act No. 07 of 2007.

Mangala Jayashantha

Chief Financial Officer

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

Dilshan Wirasekara	Nishan Fernando
Managing Director/ CEO	Chairman
13 February 2023
Colombo.
Provisional Financial Statements	FIRST CAPITAL HOLDINGS PLC
Quarter ended 31 December 2022
4