National Flour Mills : 12 May 2023 – National Flour Mills Limited – Unaudited Financial Statements for the quarter ended March 31st, 2023

NATIONAL FLOUR MILLS LIMITED

UNAUDITED RESULTS AS AT MARCH 31, 2023 (Expressed Thousands in Trinidad and Tobago Dollars)

Chairman's Review

Dear Shareholders

We are pleased to announce that NFM's continued recovery strategy in response to the unprecedented challenges due to the pandemic and the war in Ukraine, continued to bear fruit in 2023's first quarter. In the quarter ended March 31st 2023, NFM earned Net Profit after Tax of $7.5M compared to a loss of $0.8M in the prior year's first quarter primarily due to a 28% increase in revenue and a 76% increase in Gross Profit. Higher sales and our focus on increasing productivity through strategic purchasing and rigorous management of expenses contributed to this achievement.

NFM will continue to focus on the modernisation of its facilities and the development of its people. To maintain our food safety certification, build capacity and improve margins, we will continue to upgrade our infrastructure. We are also working to increase exports as another of the cornerstones for sustained profitability. Concurrently, we are working towards improving our product offerings to our valued customers, as evidenced by the launch of our new Cassava and Wheat blend of flour, in keeping with our objective of providing our customers with healthier options at an affordable price.

We remain mindful of NFM's role in providing basic food and feed services to the region and our continued investment in plant and machinery is designed to ensure that our products are produced efficiently and reasonably priced. We will continue to work with all our stakeholders to ensure that we can stay true to our purpose of feeding our Caribbean families.

Nigel Romano

Chairman

Summary Consolidated Statement of Financial Position

			UNAUDITED		AUDITED
			THREE MONTHS ENDED	YEAR ENED
			31-Mar-23	31-Mar-22		31-Dec-22
Assets	$'000			$'000		$'000
Non-current Assets
Property, plant and equipment	154,409		158,941		156,559
Intangible assets	1,475		2,764		1,652
Right-of-use assets	5,009		6,022		5,258
VAT bonds	-		5,460		-
Investments at fair value through OCI	724		697		724
Retirement benefit asset	15,161		44,535		13,398
Deferred taxation assets	11,914			9,703			11,914
			188,692			228,122			189,505
Current Assets
Accounts receivable and prepayments	82,231		94,575		83,052
Amount due from the Government of the
Republic of Trinidad and Tobago (GORTT)	18,493		20,128		20,081
Inventories	125,350		114,418		173,553
VAT bonds	5,460		-		5,460
Taxation recoverable	4,264		8,879		4,266
Restricted deposit	1,584		1,584		1,584
Cash and cash equivalents	91,957			31,322			48,523
			329,339			270,906			336,519
Total Assets	518,031		499,028			526,024
Liabilities and equity
Non-current Liabilities
Deferred tax liabilities	38,470		48,377		38,471
Retirement benefit obligation	-		-		-
Medical and life assurance plan	36,539		31,308		35,754
Borrowings	-		-		-
Lease liabilities	6,104			7,311			4,802
			81,113			86,996			79,027
Current Liabilities
Amount due to the Government of the
Republic of Trinidad and Tobago (GORTT)	19,240		19,038		19,211
Borrowings	75,961		26,693		75,757
Lease liabilities	1,200		1,038		2,414
Accounts payable and accruals	71,250		83,120		88,692
Related parties	134			-			134
			167,785		129,889			186,208
Total liabilities		248,898		216,885			265,235
Shareholders' equity
Stated capital	120,200		120,200		120,200
Treasury shares	(3,319)	-		(3,319)
Retained earnings	154,120		163,670		145,776
Other reserves	(1,868)	(1,727)	(1,868)
Total equity	269,133			282,143			260,789
Total liabilities and equity	518,031		499,028		526,024

Summary Consolidated Statement of Changes in Equity

Notes to the summary consolidated nancial statements for the three months ended March 31, 2023

1. Basis of Preparation

The summary interim consolidated financial statements are prepared in accordance with criteria developed by management. Under management's established criteria, management discloses the interim summary consolidated statement of financial position, interim consolidated statement of comprehensive income, interim summary consolidated statement of changes in equity and interim summary consolidated statement of cash flows. These interim summary consolidated financial statements are derived from the unaudited consolidated financial statements of National Flour Mills Limited and its subsidiary for the period 31 March 2023 prepared in accordance with International Financial Reporting Standards.

Summary Consolidated Statement of Comprehensive Income

		UNAUDITED		AUDITED
		THREE MONTHS ENDED		YEAR ENED
		31-Mar-23		31-Mar-22		31-Dec-22
Revenue		$'000				$'000		$'000
141,536			110,406		532,808
Cost of sales	(109,033)		(91,952)	(439,869)
Gross profit		32,503					18,454				92,939
Selling and distribution expenses	(10,274)	(9,396)	(39,896)
Administration expenses	(12,795)	(12,175)	(47,153)
Other operating income		1,390				2,572			6,569
Operating profit / (loss)		10,824				(545)	12,459
Net finance cost		(2,366)	(238)	(3,379)
Profit / (loss) before income tax	8,458			(783)	9,080
Income tax expense		(859)	-		(2,171)
Profit / (loss) for the year
	7,599				(783)	6,909
Other comprehensive (loss) / gain:
Items that would not be reclassified to profit or loss
Re-measurement of retirement benefit asset	-			-		(33,026)
Re-measurement of medical and life assurance plan	-			-		(3,819)
Changes to deferred taxes related to remeasurements	-			-		11,054
(Loss) / gain on investment at fair value through OCI	-			-		(448)
Gain on revaluation of treasury shares		-				-				52
Other comprehensive (loss) / income net of tax		-				-				(26,187)
Total comprehensive (loss) / income for the year
	7,599				(783)	(19,278)
Earnings per share
Basic earnings per share (in cents)	6.44			-		5.86
Diluted earnings per share (in cents)	6.37			-		5.79
Summary Consolidated Statement of Cash Flows
		UNAUDITED		AUDITED
		THREE MONTHS ENDED	YEAR ENDED
	31-Mar-23	31-Mar-22		31-Dec-22
Cash flows from operating activities		$'000				$'000		$'000
Profit/(loss) before taxation	8,458			(783)	9,080
Adjustments for:
Depreciation	3,768			3,674			15,755
Write off - Asset Under Construction	-			-			2,172
Amortisation	426			712			2,819
Lease interest expense	87			115			339
Interest and finance costs	1,207			-			3,176
Interest Income	(9)	93			(19)
Dividend income	(1)	(1)	(84)
Gain or loss on foreign exchange	1,082			-			(136)
Gain on treasury shares	-			-			(316)
Gain on revaluation of treasury shares	-			-			52
Retirement benefit expense	-			-			3,014
Medical plan expense	-			-			2,621
Retirement benefit asset contributions paid	(1,763)	(1,417)	(6,320)
Medical and life assurance plan contributions paid	785			471			(1,523)
Provision for doubtful accounts	300			-			(195)
Loss on Retirement pension and medical benefit	-			-			2,208
Gain on investment at fair value through OCI		-				-				(448)
Operating profit before working capital changes		14,340				2,864				32,195
Changes in working capital:	-			-			-
(Increase) / decrease in accounts receivable and prepayments	521			(15,007)	(3,679)
(Increase) / decrease in inventories	48,203			(13,881)	(73,016)
Increase in accounts payable and accruals	(19,165)	(20,365)	(14,793)
(Increase) / decrease in amounts due to / from GORTT	1,617			(292)	(72)
Increase in current amounts due to related parties	-			-			134
Decrease in investment	-			-			25
Taxes refunded		-				-				4,614
Cash generated from operating activities	45,516			(46,681)	(54,592)
Interest paid	(388)	-			(2,863)
Taxes paid	-			706			(3,236)

Year ended December 31, 2022

Balance at January 1, 2023

Profit for the period

Other movements

Balance at March 31, 2023

Year ended December 31, 2021

Balance at January 1, 2022

Loss for the period

Other movements

Balance at March 31, 2022

Year ended December 31, 2022

Opening balance at January 1, 2022 Profit for the year

Loss on investment at fair value through OCI Re-measurement of retirement benefit

asset and medical and life assurance plan, net of tax Other movements

Transactions with owners of the Group: Transfer of treasury shares

Balance at December 31, 2022

	Stated	Treasury	Other	Retained
	Capital	Shares	Reserves	Earnings	Total
	$'000	$'000	$'000	$'000	$'000
120,200	(3,319)	(1,868)	145,776	260,789
-	-	-	7,599	7,599
-	-	-	746	746
	120,200	(3,319)	(1,868)	154,120	269,133
120,200	(3,003)	(1,868)	163,142	278,471
-	-	-	(783)	(783)
-	3,003	141	1,311	4,455
	120,200	-	(1,727)	163,670	282,143
120,200	(3,003)	(1,868)	163,142	278,471
-	-	-	6,909	6,909
-	(448)	-	-	(448)
-	-	-	(25,791)	(25,791)
-	80	-	1,516	1,596
-	52	-	-	52
	120,200	(3,319)	(1,868)	145,776	260,789

Net cash generated from operating activities	45,128					(45,975)		(60,691)
Cash flows from investing activities
Disposal of assets	1					-			-
Sale of investments	-					-			52
Purchase of property, plant and equipment	(1,617)			95			(15,549)
Dividend Income	1					1			84
Interest received on investments	9					-			19
Purchase of intangible assets	-					-			(151)
Net cash used in investing activities		(1,606)			96			(15,545)
Cash flows from financing activities
Borrowings drawn	-					26,693			122,874
Borrowings repaid	-					-			(47,299)
Dividends paid	-					-			-
Lease interest paid	-					-			-
Principle repayments on finance lease	(88)			(73)		(1,397)
Net cash (used in)/generated from financing activities	(88)			26,620			74,178
Net change in cash and cash equivalents	43,434					(19,259)		(2,058)
Cash and cash equivalents at the start of the year	48,523					50,581			50,581
Cash and cash equivalents at the end of the year	91,957					31,322			48,523
				Director										Director