Maple Leaf Cement Factory : MLCF Transmission of Quarterly Report for the Period Ended 30.09.2023

1ST QUARTERLY REPORT SEPTEMBER 30, 2023

CONTENTS
CONDENSED INTERIM UNCONSOLIDATED FINANCIAL STATEMENTS
Company Information	2
Directors' Review	3
Condensed Interim Unconsolidated Statement of Financial Position	8
Condensed Interim Unconsolidated Statement of Profit or Loss	10
Condensed Interim Unconsolidated Statement of Comprehensive Income	11
Condensed Interim Unconsolidated Statement of Changes in Equity	12
Condensed Interim Unconsolidated Statement of Cash Flows	13
Selected Explanatory Notes to the Condensed Interim Unconsolidated
Financial Statements	14
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
Directors' Review	26
Condensed Interim Consolidated Statement of Financial Position	28
Condensed Interim Consolidated Statement of Profit or Loss	30
Condensed Interim Consolidated Statement of Comprehensive Income	31
Condensed Interim Consolidated Statement of Changes in Equity	32
Condensed Interim Consolidated Statement of Cash Flows	33
Selected Explanatory Notes to the Condensed Interim
Consolidated Financial Statements	34

Quarterly Report 2023

1

COMPANY

INFORMATION

Board of Directors
Mr. Tariq Sayeed Saigol	Chairman
Mr. Sayeed Tariq Saigol	Chief Executive
Mr. Taufique Sayeed Saigol
Mr. Waleed Tariq Saigol
Mr. Danial Taufique Saigol
Ms. Jahanara Saigol
Mr. Shafiq Ahmed Khan
Mr. Zulfikar Monnoo
Syed Mohsin Raza Naqvi
Executive Directors
Mr. Sohail Sadiq	Finance
Mr. Yahya Hamid	Marketing
Audit Committee
Mr. Shafiq Ahmed Khan	Chairman
Mr. Zulfikar Monnoo	Member
Mr. Waleed Tariq Saigol	Member
Mr. Danial Taufique Saigol	Member
Human Resource & Remuneration Committee
Mr. Shafiq Ahmed Khan	Chairman
Mr. Zulfikar Monnoo	Member
Mr. Danial Taufique Saigol	Member

Chief Financial Officer

Syed Mohsin Raza Naqvi

Company Secretary

Mr. Muhammad Ashraf

Chief Internal Auditor

Mr. Zeeshan Malik Bhutta

Bankers of the Company

Allied Bank Limited

Askari Bank Limited

Bank Alfalah Limited

Bank Al-Habib Limited

BankIslami Pakistan Limited

Albaraka Bank (Pakistan) Limited

Dubai Islamic Bank Limited

Faysal Bank Limited

FINCA Microfinance Bank Limited

Habib Bank Limited

Habib Metropolitan Bank Limited

MCB Bank Limited

MCB Islamic Bank Limited

National Bank of Pakistan

PAIR Investment Company Limited

Samba Bank Limited

Silk Bank Limited

Soneri Bank Limited

Standard Chartered Bank (Pakistan) Limited

Summit Bank Limited

The Bank of Punjab

United Bank Limited

Auditors

A. F. Ferguson & Co. Chartered Accountants,

308-Upper Mall, Shahrah-e-Quaid-e-Azam, Lahore. Tel: [phone]

Fax: [phone] www.pwc.com/pk

Legal Adviser

Mr. Abdul Rehman Qureshi - Advocate High Court

Registered Office

42-Lawrence Road, Lahore. Phone: [phone] Fax: [phone] E-mail: [e-mail]

Factory

Iskanderabad, District: Mianwali

Phone: [phone]

Call Center (24/7) 0800-41111

Share Registrar

Vision Consulting Limited

Head Office: 5-C, LDA Flats,

Lawrence Road, Lahore

Phone: [phone]

Fax: [phone]

E-mail: [e-mail]

Company Website:

www.kmlg.com

Note:

MLCFL's Financial Statements are also available at the above website.

Video presentation of CEO detailing financial performance of the Company is also available on the above website

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Maple Leaf Cement Factory Limited

DIRECTORS'

REVIEW

In compliance with Section 237 of the Companies Act, 2017, the Directors of your Company have pleasure to present unaudited standalone and consolidated financial statements for the first three months of financial year 2023-24, ended 30th September 2023.

During the review period, the Company recorded net consolidated turnover of Rs. 16,676 million, compared to Rs. 12,827 million in the previous period. The Company's top line increased by 30% as a result of higher selling prices in the local market and increase in local sale quantity on account of commencement of Line 4 operations. The increase in selling prices is primarily owing to the strong inflationary impact on costs, particularly fuel & power, raw material & packing material.

For the period under consideration, the following comparative data on capacity utilization and cement dispatches are provided: -

Particulars

(July to September)	Variance
2023-2024	2022-2023	Change	Percentage
( ----------------------	M. Tons ----------------------	)

Production:

Clinker Production

Cement Production

Sales:

Domestic

Exports

943,038

1,036,814

1,009,518

50,466

854,830

911,640

872,039

30,062

88,208

125,174

137,478

20,404

10.32%

13.73%

15.77%

67.87%

Total	1,059,984		902,101		157,882		17.50%

Total sales volume of 1,059,984 tons in the period represents a 17.50% increase over 902,101 tons sold during the same period last year. Domestic sales volume was 1,009,518 tons, representing an increase of 15.77% mainly due to commencement of Line 4 operations.

The export sales volume up from 30,062 tons to 50,466 tons, increased by 67.87% from the previous period due to increase in demand. Cement exports by sea were not possible due to high production costs in Pakistan in comparison to global markets, as well as increased shipping costs which hampered competitiveness in regional markets.

Global coal prices decreased during the first quarter of the current fiscal year due to demand constraints on account of global recession and are currently fairly comparable to locally available Afghan origin coal. Furthermore, due to import constraints caused by a lack of foreign exchange reserves and issues with establishing import letters of credit, the Company has been unable to import significant amounts of coal. Furthermore, during the review period, the Company relied more on Darra coal and other available local fuels.

Quarterly Report 2023

3

The Company's management launched cost-cutting initiatives and implemented numerous schemes in all areas, including the use of alternative fuels and optimizing plant operations with a specific focus on reducing fixed costs. The company has also significantly opted to use polypropylene packing bags instead of paper bags to improve its cost efficiency.

The Company was able to avert the possible negative impact of NEPRA rate hikes by largely depending on its own power generation sources, which include a coal fired power plant (CFPP), solar power plants and waste heat recovery plants, which are the cheapest source of electricity for the Company. All of the cost-cutting efforts outlined above have contributed to higher margins as compared to the same period last year.

Due to the aforementioned factors influencing production costs, the Company generated consolidated gross profit of Rs. 5,228 million during the reporting period, a 30% increase from Rs. 4,031 million in the same period last year.

The Company incurred a Finance cost of Rs. 946 million during the reporting period, a 69% increase from Rs. 561 million in the same period last year. This increase was mainly due to charging of finance cost in profit & loss account during current period subsequent to capitalization of Line 4.

The Company reported a consolidated pre-tax profit of Rs. 2,463 million for the reporting period, compared to a corresponding period profit of Rs. 1,966 million. The consolidated tax component was Rs. 836 million for the reporting period, compared to Rs. 588 million in the previous period.

Profits earned from Maple Leaf Power Limited (MLPL), a wholly owned subsidiary of the Company, established to install and operate 40 MW imported coal-fired captive power plant are exempt from charge of income tax. However, partial tax charge pertains to other income. MLPL has earned net profit of Rs. 308 million during the first quarter of financial year 2023-

24. MLPL operations have favourably impacted consolidated results by yielding substantial savings in power cost.

The aforementioned reasons increased the post-tax bottom line for the reporting period to Rs. 1,626 million as compared to Rs. 1,378 million for the similar period previous year, representing a 18% rise. However, super tax charge during the reported period is calculated at 10% as against 4% during same period last year.

FUTURE OUTLOOK

Going forward, we expect cement demand in the domestic market to increase further owing to public spending in construction sectors, improvement of macro-economic indicators and upcoming general elections.

Import restrictions due to a lack of foreign exchange reserves, excessive sea freight on account of high oil cost, the depreciation of the Pakistan rupee versus the US dollar, unfavourable macroeconomic indicators and global recession in international markets would put pressure on cement input costs. Given Pakistan's economic situation, import restrictions are unlikely to lift in the near future. As a result, in order to limit this impact and reduce the

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Maple Leaf Cement Factory Limited

risk of currency depreciation, the Company has expanded its reliance on local coal and other alternative fuels. To avoid future power sector arrears, the government aims to raise electricity rates and streamline fuel price increases in response to rising pressure from the IMF. As a result, National Grid tariffs are projected to climb further, resulting in higher power expenses for the Company. To offset the aforementioned cost escalation concerns, the Company is focusing on increasing the use of alternative fuels and renewable energy resources in order to reduce reliance on the National Grid to a bare minimum. Solar power project of 7.5MW is in process which will result in increase in solar power generation capacity of the Company to 20 MW.

ACKNOWLEDGEMENT

The Board would like to take this opportunity to offer its heartfelt gratitude and appreciation to the shareholders, employees, customers, bankers, and other stakeholders for their unwavering trust in us.

For and on behalf of the Board

Lahore	(Syed Mohsin Raza Naqvi)	(Sayeed Tariq Saigol)
October 26, 2023	Director	Chief Executive Officer

Quarterly Report 2023

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6

Maple Leaf Cement Factory Limited

UNCONSOLIDATED

FINANCIAL STATEMENTS

For the First Quarter Ended September 30, 2023

CONDENSED INTERIM UNCONSOLIDATED

STATEMENT OF FINANCIAL POSITION

AS AT SEPTEMBER 30, 2023

	Note
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorised share capital
Issued, subscribed and paid-up share capital
Capital reserves
Accumulated profits
Surplus on revaluation of fixed assets - net of tax	5
NON - CURRENT LIABILITIES
Long term loans from financial institutions - secured	6
Deferred grant
Long term loan from Subsidiary Company	7
Long term liability against right of use asset
Long term deposits
Deferred taxation
Retention money
Retirement benefits
CURRENT LIABILITIES
Current portion of:
- Long term loans from financial institutions - secured	6
- Deferred grant
- Liability against right of use assets
Trade and other payables	8
Provision for taxation
Unclaimed dividend
Mark-up accrued on borrowings
Short term borrowings
CONTINGENCIES AND COMMITMENTS	9

Un-audited Audited September 30, June 30,

2023 2023 (Rupees in thousand)

	15,000,000		15,000,000
	10,733,462		10,733,462
	6,344,076		6,363,952
	27,387,492		25,946,716
	1,734,006		1,868,984
	46,199,036		44,913,114
	15,281,020		15,233,337
	564,303		605,926
	2,000,000		2,000,000
	30,364		31,408
	8,214		8,214
	8,926,445		8,669,211
	1,744,416		1,752,988
	290,886		278,492
	28,845,648		28,579,576
	2,067,689		2,599,401
	174,615		179,766
	10,283		10,257
	12,524,523		12,518,180
	187,272		-
	27,344		27,378
	868,297		880,039
	1,155,486		-
	17,015,509		16,215,021
	92,060,193		89,707,711

The annexed notes from 1 to 21 form an integral part of this unconsolidated financial information.

8

CHIEF EXECUTIVE OFFICER

CHIEF FINANCIAL OFFICER

DIRECTOR

Maple Leaf Cement Factory Limited

Un-audited	Audited
Note September 30,	June 30,

2023 2023 (Rupees in thousand)

ASSETS

NON - CURRENT ASSETS

Property, plant and equipment	10	61,927,396
Intangible assets		6,553
Long term investment	11	5,030,000
Long term loans to employees - secured		29,087
Long term deposits		58,912
		67,051,948
CURRENT ASSETS
Stores, spare parts and loose tools		12,967,996
Stock-in-trade		3,354,248
Trade debts	12	3,786,289
Loans and advances		1,361,206
Short term investment	13	1,786,666
Short term deposits and prepayments		751,662
Accrued profit		16,794
Other receivables		19,179
Advance income tax - net of provision		-
Cash and bank balances		964,205
		25,008,245

62,354,608

6,946

5,030,000

18,089

58,401

67,468,044

9,925,852

3,874,605

2,600,988

868,404

3,689,556

482,930

8,792

22,531

25,302

740,707

22,239,667

92,060,193 89,707,711

CHIEF EXECUTIVE OFFICER

CHIEF FINANCIAL OFFICER

DIRECTOR

Quarterly Report 2023

9