HVA Foods : Interim Financial Statements for the Quarter Ended 30.09.2022

PROVISIONAL FINANCIAL STATEM ENTS

FOR THE SIX M ONTHS ENDED

30TH SEPTEM BER 2022

Chairman's Review

Dear Shareholders,

HVA Foods PLC continued its recovery momentum during the quarter under review despite the higher tea prices and the economic downturn in key markets.

Despite the challenges the Company recorded a revenue of LKR 1.65 billion for the 6 months ended 30th September 2022, which was a 180% growth compared to FY 21/22 contributed by growth in both volume and value. In terms of profitability, the company recorded a gross profit of LKR 151Mn and an operating profit of LKR 79.7 Mn. The exponential increase in freight rates combined with the depreciation of the Euro against the US Dollar impacted the profits of the company.

The company posted an LKR 47 Mn loss for the period under review, mainly driven by LKR 37 Mn in net exchange losses (impact of the depreciation of the Euro on debtor receivables) and LKR 89 Mn in Finance cost paid. The high interest cost combined with the high prices paid for the purchase of teas at the Colombo Tea Auction has made Ceylon Tea less competitive in the global markets with key tea producing

countries taking over market share. Therefore, with a long-term view, a conscious strategic decision was taken to absorb part of the high costs with a view of building on the companies' presence in key markets.

I would like to conclude by reassuring our stakeholders that the company with its flagship brand "Heladiv"

registered in over 40 countries, is exploring all avenues to achieve a sustainable growth in the months ahead even amidst these challenging times.

B. S. M De Silva

Chairman

15th November 2022

HVA FOODS PLC

Statement of Comprehensive Income

Provisional Financial Statements for the Six months ended 30th September 2022

All amounts in Sri Lanka Rupees

						Group										Company
		6 Months from 1st April to		3 Months from 1st July to	Year ended		6 Months from 1st April to		3 Months from 1st July to	Year ended
		30.09.2022	30.09.2021		30.09.2022	30.09.2021		31.03.2022		30.09.2022	30.09.2021		30.09.2022	30.09.2021		31.03.2022
		(Unaudited)	(Unaudited)		(Unaudited)	(Unaudited)	(Audited)		(Unaudited)	(Unaudited)		(Unaudited)	(Unaudited)	(Audited)
Revenue		1,645,590,197	587,508,210		830,935,792	264,910,303		1,261,234,481		1,645,590,197	587,508,210		830,935,792	264,910,303		1,261,234,481
Cost of Sales		(1,494,485,378)	(543,355,819)	(761,083,248)	(255,540,885)	(1,215,324,928)		(1,494,485,378)	(543,355,819)	(761,083,248)	(255,540,885)	(1,215,324,928)
Gross Profit		151,104,819	44,152,391		69,852,544	9,369,418		45,909,553		151,104,819	44,152,391		69,852,544	9,369,418		45,909,553
Other Operating Income		5,462,900	55,412,601		1,969,367	1,616,832		94,166,619		5,462,900	55,412,601		1,969,367	1,616,832		94,166,619
Distribution Expenses		(7,885,273)	(67,332,557)	(4,797,891)	(59,419,454)	(15,507,477)		(7,885,273)	(67,332,557)	(4,797,891)	(59,419,454)	(15,507,477)
Administration Expenses		(68,968,310)	(65,053,594)	(36,625,058)	(29,707,049)	(317,019,350)		(68,940,100)	(65,053,594)	(36,610,953)	(29,707,049)	(316,865,110)
Results from Operating Activities		79,714,135	(32,821,159)	30,398,962	(78,140,253)	(192,450,655)		79,742,345	(32,821,159)	30,413,067	(78,140,253)	(192,296,415)
Net Finance Costs		(126,800,181)	(57,319,056)	(74,015,292)	(16,022,756)	(56,661,031)		(126,800,181)	(57,319,056)	(74,015,292)	(16,022,756)	(56,656,541)
Profit / (Loss) Before Income Tax		(47,086,046)	(90,140,215)	(43,616,330)	(94,163,009)	(249,111,686)		(47,057,836)	(90,140,215)	(43,602,225)	(94,163,009)	(248,952,956)
Income Tax Expense		-	-		-	-		20,066,395		-	-		-	-		20,066,395
Profit / (Loss) for the Period		(47,086,046)	(90,140,215)	(43,616,330)	(94,163,009)	(229,045,291)		(47,057,836)	(90,140,215)	(43,602,225)	(94,163,009)	(228,886,561)
Actuarial gain/(Loss) on retirement benefit obligation					-	-		52,698						-	-		52,698
Revaluation gain of Property, Plant and Equipments					-	-		-						-	-		-
Tax on other comprehensive income					-	-		(7,378)						-	-		(7,378)
Total Comprehensive Income / (Expense) for the Pe		(47,086,046)	(90,140,215)	(43,616,330)	(94,163,009)	(228,999,971)		(47,057,836)	(90,140,215)	(43,602,225)	(94,163,009)	(228,841,241)
Basic Earnings Per Share		(0.41)	(1.36)	(0.38)	(1.42)	(3.45)		(0.40)	(1.36)	(0.38)	(1.42)	(3.44)
Diluted Earnings Per Share		(0.52)	(1.36)	(0.48)	(1.42)	(3.45)		(0.52)	(1.36)	(0.48)	(1.42)	(3.44)

Figures in brackets indicate deductions.

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HVA FOODS PLC

Statement of Financial Position

Provisional Financial Statements for the Six months ended 30th September 2022
All amounts in Sri Lanka Rupees
		Group				Company
As at	30.09.2022	30.09.2021	31.03.2022		30.09.2022	30.09.2021	31.03.2022
	(Unaudited)	(Unaudited)	(Audited)	(Unaudited)	(Unaudited)		(Audited)
ASSETS
Non-current assets
Property, plant & equipment	44,654,255	47,725,692	44,154,530		44,654,255	47,725,692	44,154,530
Goodwill	263,849,498	263,849,498	263,849,498		263,849,498	263,849,498	263,849,498
Investment in subsidiary	-	-	-		45,000,001	45,000,001	45,000,001
Intangible assets	55,415,287	52,181,337	53,251,884		10,476,290	7,242,340	8,312,887
Deferred tax assets	71,390,000	14,776,364	71,390,000		71,390,000	14,776,364	71,390,000
Total non-current assets	435,309,040	378,532,891	432,645,912		435,370,044	378,593,895	432,706,916
Current assets
Inventories	430,402,043	344,193,170	166,504,061		430,402,043	344,193,170	166,504,061
Financial investments	1,641,867	2,715,917	1,887,938		1,641,867	2,715,917	1,887,938
Trade & Other receivables	577,395,737	298,972,659	287,376,671		577,395,737	298,972,659	287,376,671
Amounts due from related parties	1,598,816	19,701	706,525		1,854,456	96,501	935,925
Pre-payments & other recoverable	8,692,256	44,553,262	40,634,369		8,692,256	44,553,262	40,634,369
Deposits & advances receivables	72,195,972	29,901,629	165,236,467		72,195,972	29,901,629	165,236,467
Cash & cash equivalents	71,295,352	90,150,586	125,562,484		71,289,537	90,140,281	125,556,669
Total current assets	1,163,222,043	810,506,924	787,908,515		1,163,471,868	810,573,419	788,132,100
Total assets	1,598,531,083	1,189,039,815	1,220,554,427		1,598,841,912	1,189,167,314	1,220,839,016
Equity and liabilities
Stated capital	582,965,063	333,857,588	333,857,588		582,965,063	333,857,588	333,857,588
Revaluation reserve	16,701,071	16,701,071	16,701,071		16,701,071	16,701,071	16,701,071
Retained earnings	(574,522,984)	(424,920,229)	(527,436,938)		(574,192,145)	(424,776,330)	(527,134,309)
Total equity attributable to the equity holders of the company / Total	25,143,150	(74,361,570)	(176,878,279)		25,473,989	(74,217,671)	(176,575,650)
equity
Non-current liabilities
Employee benefits	7,211,230	6,825,053	7,113,868		7,211,230	6,825,053	7,113,868
Interest-bearing loans and borrowings	523,156,000	565,325,000	536,840,000		523,156,000	565,325,000	536,840,000
Government grant	8,320,426	9,984,526	8,875,126		8,320,426	9,984,526	8,875,126
Total non-current liabilities	538,687,656	582,134,579	552,828,994		538,687,656	582,134,579		552,828,994
Current liabilities
Trade payables	65,758,201	50,798,949	40,865,145		65,758,201	50,798,949	40,865,145
Interest-bearing loans and borrowings	634,958,895	312,483,191	270,202,758		634,958,895	312,483,191	270,202,758
Government grant	1,109,400	1,109,400	1,109,400		1,109,400	1,109,400	1,109,400
Amounts due to related parties	-	49,070,239	92,290,527		-	49,070,239	92,290,527
Income tax payables	-	-	-		-	-	-
Deposits & advances payables	2,447,969	169,987,354	308,106,204		2,447,969	169,987,354	308,106,204
Accrued expenses & other creditors	130,056,051	57,485,404	70,508,588		130,036,041	57,469,004	70,490,548
Bank overdrafts	200,369,761	40,332,269	61,521,090		200,369,761	40,332,269		61,521,090
Total current liabilities	1,034,700,277	681,266,806	844,603,712		1,034,680,267	681,250,406		844,585,672
Total liabilities	1,573,387,933	1,263,401,385	1,397,432,706		1,573,367,923	1,263,384,985		1,397,414,666
Total equity & liabilities	1,598,531,083	1,189,039,815	1,220,554,427		1,598,841,912	1,189,167,314		1,220,839,016
Net Assets per Share - (LKR)	0.22	(1.12)	(2.66)		0.22	(1.12)	(2.66)
The figures as at 30th September 2022 are provisional & subject to audit.
Figures in brackets indicate deductions.

……………….…….……………

Head of Finance

Approved and signed for and on behalf of the Board

……………….…….……………	……………….……
Director	Director

Colombo

15th November 2022

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HVA FOODS PLC

Statement of Changes in Equity

Provisional Financial Statements for the Six months ended 30th September 2022

All amounts in Sri Lanka Rupees

Group

	Attributable to equity holders of the company
	Stated capital		Revaluation		Retained		Total
		reserves		earnings
Balance as at 01st April 2021
333,857,588	237,613,039	(555,691,982)	15,778,645
Loss For the Period	-	-	(90,140,215)	(90,140,215)
Realisation of revaluation surplus	-	(220,911,968)	220,911,968	-
Balance as at 30th September 2021	333,857,588	16,701,071	(424,920,229)	(74,361,570)
Balance as at 01st April 2022	333,857,588	16,701,071	(527,436,938)	(176,878,279)
Issue of Shares	249,107,475					249,107,475
Loss For the Period	-	-	(47,086,046)	(47,086,046)
Balance as at 30th September 2022	582,965,063	16,701,071	(574,522,984)	25,143,150
Company	Stated capital		Revaluation		Retained		Total
		reserves		earnings
Balance as at 01st April 2021
333,857,588	237,613,039	(555,548,083)	15,922,544
Profit For the Period	-	-	(90,140,215)	(90,140,215)
Realisation of revaluation surplus	-	(220,911,968)	220,911,968	-
Balance as at 30th September 2021	333,857,588	16,701,071	(424,776,330)	(74,217,671)
Balance as at 01st April 2022	333,857,588	16,701,071	(527,134,309)	(176,575,650)
Issue of Shares	249,107,475					249,107,475
Loss For the Period	-	-	(47,057,836)	(47,057,836)
Balance as at 30th September 2022	582,965,063	16,701,071	(574,192,145)	25,473,989
Figures in brackets indicate deductions.
The above figures are not audited

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