Ansari Sugar Mills : Transmission of Quarterly Report for the Period Ended June 30, 2021

Third

Quarter Accounts

June 30, 2021

BOARD OF DIRECTORS
Khawaja Anver Majid	Chief Executive & Executive Director
Noor Muhammad	Non-Executive Director (Independent)
Waheed Ahmed	Non- Executive Director
Khawaja Aleem Majid	Non- Executive Director
Iqbal Buledi	Non- Executive Director
Dawoodi Morkas	Non- Executive Director
Aurangzeb Khan	Executive Director & Chairman
AUDIT COMMITTEE
Khawaja Aleem Majid	Chairman, Non-Executive Director
Noor Muhammad	Member, Non-Executive Director (Independent)
Dawoodi Morkas	Member, Non Executive Director

HUMAN RESOURCE &

RUMENERATION COMMITTEE

Khawaja Aleem Majid	Chairman, Non Executive Director
Noor Muhammad	Member, Non- Executive Director (Independent)
Waheed Ahmed	Member Non- Executive Director
CHIEF FINANCIAL OFFICER	Khawaja Muhammad Salman Younis
COMPANY SECRETARY	Imran Hameed
BANKERS	National Bank of Pakistan
	Sindh Bank Limited
	Summit Bank Limited
	UBL Bank Limited
	MCB Bank Limited
	Habib Bank Limited
	Bank-Al-Habib Limited
AUDITORS	M/s. J.A.S.B & Associates Chartered Accountants
COST AUDITOR	Rao & Co Chartered Accountants
	Cost and Management Accountants
LEGAL ADVISOR	Kashif Hanif Law Associates
REGISTRAR	C&K Management Associates (Pvt) Ltd
	404, 4th floor, Trade Tower, Abdullah Harron Road,
	Saddar, Karachi.
REGISTERED OFFICE	Deh Jagsiyani, Taluka Tando Ghulam Hayder,
	District Tando Mohammad Khan, Hyderabad, Sindh.
CORPORATE OFFICE	CL-5/4, State Life Building No. 10,
	Abdullah Haroon Road, Karachi
EMAIL ADDRESS	[e-mail]
WEBSITE	www.ansarisugar.com.pk
FACTORY	Deh Jagsiyani,Taluka Tando Ghulam Hayder
	District Tando Muhammad Khan,Sindh.

DIRECTOR'S REPORT

We are pleased to present the financial statements of Ansari Sugar Mills Ltd for the third quarter ended June 30, 2021 along with Directors' Report for the period ended.

	June 30,	June 30,
	2021	2020
Pakistani Rupees (PKR)
FINANCIAL RESULTS
Sales	405,166,581	174,997,904
Gross profit	130,870,720	56,802,570
Pre-tax (loss)	(221,659,399)	(484,615,465)

The crushing season 2020-21 started on November 11th 2020. The provincial government announced price of cane at Rs. 202 per 40 kg for the season 2020-21.

Season started		11-11-2020	15-12-2019
Actual	Days	104	74
Sugar Cane Crushed	M.Tons	61,472	31,341
Sugar produced	M.Tons	6,313	3,001
Sugar recovery	%	9.296	9.80
Molasses produced	M.Tons	3,130	1,369
Molasses recovery	%	4.837	4.43

The mill commenced its crushing operations on 11th November, 2020.The gross profit worked out to Rs130.9 million as against a gross profit of Rs. 56.8 million during the corresponding period. Loss before tax worked out to Rs. 221.7 million, in comparison to last period loss of Rs. 484.6 million Company posted net loss after tax of Rs. 101.02 million compare to a net loss Rs. 351.4 million during the corresponding period last year.

Delay in issuance / submission of Accounts:

During the previous years, an enquiry against the Company's sponsors / directors and its shareholders along with other group companies had been initiated by the Federal Investigation Agency (FIA). Further, the matter was transferred to National Accountability Bureau (NAB) and we understand the Financial Institutions had blocked all Company bank accounts on a notice of NAB under section 23 of National Accountability Ordinance 1999 (NAO) on allegation of illicit transactions. However, it is pertinent to mention here that the action of blocking of account was not endorsed by Court of competent jurisdiction.

As a consequence, Company's access to available funds / legitimate sales proceeds and banking facilities were denied on the unjustified and arbitrary instructions of NAB, without realizing the consequences. Resultantly, the Company was forced to default on its dues including payments of banks' instalments, salaries, growers' and vendors', etc.

It is pertinent to note that the JIT, constituted under orders of the Supreme Court of Pakistan thoroughly investigated the entire Group Accounts maintained with all banks and that no charge has been established till yet. Despite all the ordeal no case have been filled against the Company.

Henceforth, after the amendment of NAB Ordinance, the bank accounts of the Company have been unfrozen and we are in coordination with all the stakeholders owing debt and other liabilities to move forward amicably.

It is pertinent to mention here that besides all the pressures of liquidity crises, risk and uncertain business environment, the Company took the initiative to carry on its business activities in extreme difficult situation with all possible efforts, making the necessary financial arrangements on personal basis by the sponsoring directors to ensure the going concern of the Company and by the collective efforts of the entire team of Ansari Sugar Mills Limited, we are through of the precarious conditions successfully by the grace of Almighty (Alhamdulillah).

Future Outlook:

Diversifying Revenue Streams:

The Company is focused to attain better energy efficiency mix and planning Balancing, Modernization and Replacement (BMR) accordingly, which will improve the revenue streams through sale of by-products of the company i.e. bagasse and molasses.

Sugarcane Cultivation Prospects:

The Company recognizes that the growth and sustainability in the sugar industry is also dependent on access to a growing volume of sugar cane, particularly from within existing areas of supply. The key here lies in long-term engagement with farmers, demonstrating the use of superior cane varieties (higher yield and hence higher income), timely growing support (provision of seeds, fertilizers and farming inputs) so as to convince them to plant more cane to ensure increased productivity and quality.

Moreover, where heavy rainfall and resultant flash floods have an adverse effect on the

agriculture, sugarcane due to its robust nature manages to stay afloat. We expect that harvesting will remain optimum and mills will have enough sugarcane for crushing throughout the next season.

Government Policy:

Ansari Sugar Mills foresee bumper crushing of sugarcane as evidenced by increased production of sugarcane over last 2 to 3 years. As the Federal government regulates the export of sugar, we anticipate that the supply and demand balance will improve over the next year, and that domestic production will meet the country's sugar demands while creating an export surplus on sugar and ethanol. Thus, timely export permission from Federal government would be of critical importance as it would not only help industry to clear the surplus on improved price but would also stabilize the local market as well. The Government is also contemplating on allowing export as a permanent feature rather than allocating on quota basis which will allow us to fetch good prices on our stocks in international market.

Working Capital:

We are in advanced level of negotiations with our bankers to restructure our debts which will improve our position on retained stocks, refraining ourselves into forced sales and allowing us to fetch better price during off-season as currently due to lack of working capital lines, almost 100% of our stock is sold during the crushing season to meet the working capital.

In the background of preceding paras your management anticipate a turnaround of the sugar industry and accordingly have mobilized all the resources at its disposal to generate huge volumes during the ongoing and upcoming seasons over the next 5 years.

The season in terms of cane supply, recovery and plant capacity utilization is extremely favorable. Ansari Sugar Mills being a large plant will be able to capitalize and procure and crush maximum cane in the next season.

Acknowledgement

We express our sincerest appreciation to our employees for their dedication and hard work and to our clients, business partners and shareholders for the support and confidence. The board also take this opportunity to express its gratitude to all the employees of Ansari Sugar Mill Limited for their untiring efforts.

On behalf of the Board of Directors

Khawaja Anver Majid

Chief Executive Officer

Karachi: March 11, 2024

BALANCE SHEET

AS AT JUNE 30, 2021

			Un-Audited			Audited
Note	June 30,			September 30,
ASSETS			2021	2020
NON CURRENT ASSETS
Property, plant and equipment	6		4,267,939,054	4,309,937,464
Intangible assets			254,310	337,954
Long term investment			-	-
Long term loans			-	-
Long term deposits			1,236,600		1,236,600
			4,269,429,964	4,311,512,018
CURRENT ASSETS
Inventories			2,770,459,454	2,709,616,617
Trade and other receviables			392,351,223	209,269,631
Prepayments, deposits and advances			1,103,105,051	1,248,776,733
Cash and bank balances			360,842,153		328,329,520
			4,626,757,881		4,495,992,501
			8,896,187,845	8,807,504,519
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Share Capital
Authorised capital			900,000,000		900,000,000
Issued, subscribed and paid-up capital	561,365,550	561,365,550
Reserves
Capital reserve
Share premium			317,293,570	317,293,570
Surplus on revaluation of fixed assets			1,770,965,633	1,790,538,683
Equity reserves			336,000,000		336,000,000
			2,424,259,203	2,443,832,253
Revenue reserves
Dividend equalization reserve			27,000,000	27,000,000
Accumulated losses			(1,485,003,506)	(1,403,548,337)
			(1,458,003,506)	(1,376,548,337)
			1,527,621,247	1,628,649,466
Subordinated loan			-	-
			1,527,621,247	1,628,649,466
NON CURRENT LIABILITIES
Financial liabilities			1,084,338,483	1,543,445,719
Deferred liabilities			595,638,387	722,796,120
Provision for quality premium			264,108,125		264,108,125
			1,944,084,995	2,530,349,964
CURRENT LIABILITIES
Trade and other payables			361,741,359	360,805,853
Financial liabilities			3,398,325,928	2,939,218,693
Accrued mark-up			1,638,546,624	1,329,139,404
Unclaimed dividend			2,196,784	2,196,784
Current tax liability			23,670,908	17,144,355
			5,424,481,603	4,648,505,089
CONTINGENCIES AND COMMITMENTS		-
			8,896,187,845	8,807,504,519

The annexed notes form an integral part of these financial statements.

STATEMENT OF PROFIT AND LOSS

FOR THE PERIOD ENDED JUNE 30, 2021

		Quarter ended		Nine months Period Ended
	Note
		June 30,		June 30,		June 30,		June 30,
	2021	2020	2021	2020
Sales - net	-	29,793	405,166,581	174,997,904
Cost of sales		-		(23,251)		(274,295,861)		(118,195,334)
Gross profit	-	6,542	130,870,720	56,802,570

Operating expenses

Selling and distribution expenses Administrative expenses Other charges

-		-		(5,056,066)		(2,324,121)
(12,006,106)		(10,889,990)		(38,029,672)		(36,475,994)
-		-		-		-
(12,006,106)	(10,889,990)	(43,085,738)	(38,800,115)

	(12,006,106)	(10,883,448)	87,784,982	18,002,455
Operating profit
Other operating income	-	-	-	-
	(12,006,106)	(10,883,448)	87,784,982	18,002,455
Finance cost	(104,927,817)	(149,366,972)	(309,444,381)	(502,617,920)
Loss before taxation	(116,933,923)	(160,250,420)	(221,659,399)	(484,615,465)
Taxation	40,786,447	43,931,167	120,631,180	133,182,704
Loss after taxation	(76,147,476)	(116,319,253)	(101,028,219)	(351,432,761)
Loss per share - basic and diluted	(1.36)	(2.07)	(1.80)	(6.26)

The annexed notes form an integral part of these financial statements.

CASH FLOW STATEMENT

FOR THE PERIOD ENDED JUNE 30,2021

Loss before taxation

Adjustments for :

Depreciation

Amortization

Finance cost

Operating (loss) / profit before working capital changes

Changes in working capital : (Increase) / decrease in current assets:

Inventories

Trade and other receviables

Prepayments, deposits and advances

Increase in current liabilities:

Trade and other payables

CASH FLOWS FROM OPERATING ACTIVITIES Net cash generated from / (used in) operations

Taxes paid

Gratuity paid

Finance cost paid

Net cash used in operating activities

CASH FLOWS FROM INVESTING ACTIVITIES

Property, plant & equipment Capital work in progress Intangible Assets

Long term investments Long term loans Long term deposits

Proceeds from disposal of property plant and equipment

Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Un-Audited

June 30,

2021

(221,659,399)

41,998,410

83,644

309,407,220

351,489,274

129,829,875

(60,842,837)

(183,081,591)

145,671,683

-

935,504

(97,317,241)

32,512,633

-

-

-

32,512,633

-

-

-

-

-

-

-

-

Un-Audited

June 30,

2020

(484,615,465)

42,613,728

124,842

502,854,943

545,593,513

60,978,048

(79,953,474)

(24,492,612)

196,988,897

-

(148,030,069)

(55,487,258)

5,490,790

-

-

-

5,490,790

-

-

-

-

-

-

-

-

long term loans-net	-	-
share capital	-	-
Share premium	-	-
Subordinated Loan	-		-
Net cash flow from financing activities	-	-
Net decrease in cash and cash equivalents	32,512,633	5,490,790
Cash and cash equivalents at the beginning of the year	(1,308,150,993)	(1,307,977,959)
Cash and cash equivalents at the end of the year	(1,275,638,360)	(1,302,487,169)

The annexed notes form an integral part of these financial statements.

STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED JUNE 30, 2021

	Quarter ended		Nine months Period Ended
	June 30,	June 30,		June 30,	June 30,
	2021	2020	2021	2020
(Loss) after taxation	(76,147,476)	(116,319,253)	(101,028,219)	(351,432,761)

Incremental depreciation arising from

revaluation of property, plant and equipment

Total comprehensive loss for the period

2,323,526	2,325,014	19,573,049	16,799,562
(73,823,950)	(113,994,239)		(81,455,169)	(334,633,199)

The annexed notes form an integral part of these financial statements.

STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED JUNE 30, 2021

				Capital Reserves			Revenue Reserve
		Issued,
		subscribed and	Share Premium	Equity Reserve	Revalauation	Sub Total	General reserve	Unappropriated profit /	Sub Total	Grand Total
		paid-up capital			Surplus on PPE			(Accumulated loss)
		--------------------------------------------------------------------------------------				(Rupees) --------------------------		------------------------------------------------------------
As at Septemer 30, 2019	561,365,550	317,293,570	336,000,000	1,812,938,099	2,466,231,669	27,000,000	(990,307,481)	(963,307,481)	2,064,289,738
Loss for the year	-	-	-	-	-	-	(437,468,945)	(437,468,945)	(437,468,945)
Issue of Shares at premium	-	-	-	-	-	-	-	-	-
Re-measurement of define benefit liability	-	-	-	-	-	-	1,828,673	1,828,673	1,828,673
Incremental depreciation on revalued	-	-	-	(22,399,416)	(22,399,416)	-	22,399,416	22,399,416	-
Balance as at September 30, 2020	561,365,550	317,293,570	336,000,000	1,790,538,683	2,443,832,253	27,000,000	(1,403,548,337)	(1,376,548,337)	1,628,649,466
Loss for the period	-	-	-	-	-	-	(101,028,219)	(101,028,219)	(101,028,219)
Issue of Shares at premium	-	-	-	-	-	-	-	-	-
Re-measurement of define benefit liability	-	-	-	-	-	-	-	-	-
Incremental depreciation on revalued	-	-	-	(19,573,049)	(19,573,049)	-	19,573,049	19,573,049	-
Balance as at June 30, 2021	561,365,550	317,293,570	336,000,000	1,770,965,634	2,424,259,203	27,000,000	(1,485,003,506)	(1,458,003,506)	1,527,621,247
								-

The annexed notes form an integral part of these financial statements.