Trafco B S C : 2024 Financial Statements - 1st Quarter (English)

Trafco Group B.S.C.

INTERIM CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

31 MARCH 2024 (REVIEWED)

REPORT ON THE REVIEW OF THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS TO THE BOARD OF DIRECTORS OF TRAFCO GROUP B.S.C.

Introduction

We have reviewed the accompanying interim condensed consolidated financial statements of Trafco Group B.S.C. ("the Company") and its subsidiaries (together "the Group") as at 31 March 2024, comprising of the interim consolidated statement of financial position as at 31 March 2024 and the related interim consolidated statements of profit or loss and other comprehensive income, cash flows and changes in equity for the three-month period then ended and explanatory notes. The Board of Directors of the Company is responsible for the preparation and presentation of these interim condensed consolidated financial statements in accordance with International Accounting Standard 34 ('IAS 34') "Interim Financial Reporting". Our responsibility is to express a conclusion on these interim condensed consolidated financial statements based on our review.

Scope of review

We conducted our review in accordance with the International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34.

Auditor's Registration No. 45

12 May 2024

Manama, Kingdom of Bahrain

Trafco Group B.S.C.

INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

For the period ended 31 March 2024 (Reviewed)

	Three-month period ended
	31 March
	2024	2023
	BD		BD
OPERATING ACTIVITIES
Profit of the Group for the period	1,154,943	1,080,936
Adjustments for:
Investment income	(698,843)	(734,331)
Depreciation of property, plant and equipment	246,468	244,516
Depreciation of right-of-use assets	104,983	99,401
Finance costs on lease liabilities	51,456	47,766
Other finance costs	95,123	110,517
Provision for employees' end of service benefits	59,305	46,439
Provision for slow moving and obsolete of inventories	16,335	17,587
Allowance for expected credit losses	38,222	32,200
Operating profit before changes in working capital	1,067,992	945,031
Working capital changes:
Inventories	11,408	(196,592)
Right of return assets	(990)	(2,314)
Trade and other receivables	(2,440,868)	(1,547,144)
Trade and other payables	924,930	(103,591)
Retention payable	79,470	-
Contract and refund liabilities	87,739	56,087
Net cash used in operations	(270,319)	(848,523)
Directors' remuneration paid	(119,925)	(102,500)
Employees' end of service benefits paid	(23,447)	(18,811)
Net cash flows used in operating activities	(413,691)	(969,834)
INVESTING ACTIVITIES
Additions to property, plant and equipment	(1,132,056)	(107,912)
Purchase of investments at fair value through other comprehensive income	(56,631)	(22,208)
Proceeds from disposals of investments at fair value through
other comprehensive income	-	73,687
Dividends and interest received	344,913	325,189
Net cash flows (used in)/from investing activities	(843,774)	268,756
FINANCING ACTIVITIES
Import loans availed	2,964,527	3,744,187
Repayment of import loan	(2,530,206)	(3,261,862)
Finance costs paid	(85,087)	(103,020)
Term loan availed	-	1,300,000
Repayment of term loan	(209,296)	(136,171)
Payment of principal portion of lease liabilities	(190,195)	(177,013)
Finance costs paid on lease liabilities	(51,456)	(47,766)
Net cash flows (used in)/from financing activities	(101,713)	1,318,355

Theattached notes 1 to 12 form part of these interim condensed consolidated financial statements. 4

Trafco Group B.S.C.

INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS (continued)

For the period ended 31 March 2024 (Reviewed)

	Three-month period ended
	31 March
	2024	2023
	BD		BD
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS	(1,359,178)	617,277
Foreign currency translation adjustments - net	(554)	4,258
Cash and cash equivalents at 1 January	5,038,110	3,142,708
CASH AND CASH EQUIVALENTS AT 31 MARCH (A)	3,678,378	3,764,243
(A) Cash and cash equivalents comprise of following amounts:
Cash, bank balances and short-term deposits	3,678,378	4,406,259
Less: Bank overdrafts	-	(642,016)
	3,678,378	3,764,243

Theattached notes 1 to 12 form part of these interim condensed consolidated financial statements. 5

Trafco Group B.S.C.

INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the period ended 31 March 2024 (Reviewed)

									Attributable to the shareholders of Trafco Group B.S.C.
													Reserves
																	Retained
													Foreign		Retained		earnings								Non-
	Share		Treasury		Share		Statutory		General		Fair value		currency		earnings -		non-		Proposed		Total	Shareholders'		controlling		Total
	capital		shares		premium		reserve		reserve		reserve		reserve		distributable		distributable	appropriations		reserves		equity		interests		equity
	BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD
Balance at 1 January 2024	8,067,505	(1,706,644)	3,386,502	4,033,753	1,615,000	8,483,180	(49,259)	4,597,974	496,736	1,311,223	20,488,607	30,235,970	5,403,645	35,639,615
Profit for the period	-	-	-	-	-	-	-	958,076	-	-	958,076	958,076	196,867	1,154,943
Other comprehensive income
for the period	-	-	-	-	-	100,911	(283)	-	-	-	100,628	100,628	13,883	114,511
Total comprehensive income
for the period	-	-	-	-	-	100,911	(283)	958,076	-	-	1,058,704	1,058,704	210,750	1,269,454
Dividends (note 9)	-	-	-	-	-	-	-	-	-	(1,261,223)	(1,261,223)	(1,261,223)	-	(1,261,223)
Transfer to general reserve	-	-	-	-	50,000	-	-	-	-	(50,000)	-	-	-	-
Balance at 31 March 2024	8,067,505	(1,706,644)	3,386,502	4,033,753	1,665,000	8,584,091	(49,542)	5,556,050	496,736	-	20,286,088	30,033,451	5,614,395	35,647,846
									Attributable to the shareholders of Trafco Group B.S.C.
													Reserves
																	Retained
													Foreign		Retained		earnings								Non-
	Share		Treasury		Share		Statutory		General		Fair value		currency		earnings -		non-		Proposed		Total	Shareholders'		controlling		Total
	capital		shares		premium		reserve		reserve		reserve		reserve		distributable		distributable	appropriations		reserves		equity		interests		equity
	BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD		BD
Balance at 1 January 2023	8,067,505	(1,706,644)	3,386,502	4,033,753	1,565,000	7,339,975	(38,048)	4,047,633	496,736	1,162,844	18,607,893	28,355,256	4,919,438	33,274,694
Profit for the period	-	-	-	-	-	-	-	880,183	-	-	880,183	880,183	200,753	1,080,936
Other comprehensive income
for the period	-	-	-	-	-	265,334	2,172	-	-	-	267,506	267,506	12,755	280,261
Total comprehensive income
for the period	-	-	-	-	-	265,334	2,172	880,183	-	-	1,147,689	1,147,689	213,508	1,361,197
Dividends (note 9)	-	-	-	-	-	-	-	-	-	(1,112,844)	(1,112,844)	(1,112,844)	-	(1,112,844)
Transfer to general reserve	-	-	-	-	50,000	-	-	-	-	(50,000)	-	-	-	-
Gain on disposal of investments
at fair value through other
comprehensive income	-	-	-	-	-	(50,072)	-	50,072	-	-	-	-	-	-
Balance at 31 March 2023	8,067,505	(1,706,644)	3,386,502	4,033,753	1,615,000	7,555,237	(35,876)	4,977,888	496,736	-	18,642,738	28,390,101	5,132,946	33,523,047

The attached notes 1 to 12 form part of these interim condensed consolidated financial statements.

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Trafco Group B.S.C.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

At 31 March 2024 (Reviewed)

1 CORPORATE INFORMATION

Trafco Group B.S.C. ('the Company' or 'Trafco') is a public joint stock company, the shares of which are listed and publicly traded on Bahrain Bourse. The Company was incorporated in the Kingdom of Bahrain by Amiri Decree No. 10 of November 1977. The Company operates in accordance with the provisions of the Bahrain Commercial Companies Law under commercial registration (CR) number 8500 issued by the Ministry of Industry and Commerce. The Company's registered office is situated at Building 117, Road 42, Block 343, Mina Salman Industrial Area, Kingdom of Bahrain. The Company's principal activity is trading in food products.

The Group comprises of the Company and its subsidiaries. The details of Company's subsidiaries and an associate are disclosed in the Group's annual consolidated financial statements for the year ended 31 December 2023.

The interim condensed consolidated financial statements were authorized for issue by the Board of Directors on 12 May 2024.

2 MATERIAL ACCOUNTING POLICIES

Basis of preparation

The interim condensed consolidated financial statements have been prepared in accordance with International Accounting Standard (IAS) 34, "Interim Financial Reporting".

The interim condensed consolidated financial statements do not contain all information and disclosures required in the annual consolidated financial statements prepared in accordance with International Financial Reporting Standards, and should be read in conjunction with the Group's annual consolidated financial statements for the year ended 31 December 2023. In addition, results for the three months period ended 31 March 2024 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2024.

New and amended standards and interpretations adopted by the Group

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended 31 December 2023, except for the new and amended standards and interpretations effective as of 1 January 2024. The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.

The following amendment applies for the first time in 2024, but do not have an impact on the interim condensed consolidated financial statements of the Group.

• IAS 7 and IFRS 7 - Supplier Finance Arrangements
• IFRS 16 - Lease liability in a sale and leaseback
• IAS 1 - Classification of liabilities as current and non-current

3 MATERIAL ACCOUNTING JUDGEMENTS AND ESTIMATES

The significant accounting judgements and estimates used in the preparation of the interim condensed consolidated financial statements are consistent with those used in the preparation of the Group's annual consolidated financial statements for the year ended 31 December 2023.

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Trafco Group B.S.C.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

At 31 March 2024 (Reviewed)

4 REVENUE

The following table presents the disaggregation of the Group's revenue for the three-month periods ended 31 March 2024 and 31 March 2023:

										Dairy products and		Fruits and		Storage and
	Wholesale operations			Retail operations		beverages		vegetables		logistics			Livestock		Total
	2024	2023			2024	2023		2024	2023		2024	2023		2024			2023		2024	2023		2024	2023
	BD		BD			BD		BD		BD		BD		BD		BD		BD	BD		BD		BD		BD		BD
Types of revenue
Sale of goods	3,846,498	4,182,086	318,094	274,276	6,197,363	5,483,985	577,075	499,192	-			-	1,421,397	1,464,691	12,360,427	11,904,230
Rendering of services	-	-	-	-	-	-	-	-	148,650			165,587	-	-	148,650	165,587
	3,846,498	4,182,086	318,094	274,276	6,197,363	5,483,985	577,075	499,192	148,650			165,587	1,421,397	1,464,691	12,509,077	12,069,817
Geographic markets
Bahrain	3,846,498	4,182,086	318,094	274,276	4,789,517	4,170,317	577,075	499,192	148,650			165,587	1,421,397	1,464,691	11,101,231	10,756,149
Other GCC countries	-	-	-	-	1,407,846	1,313,668	-	-	-			-	-	-	1,407,846	1,313,668
	3,846,498	4,182,086	318,094	274,276	6,197,363	5,483,985	577,075	499,192	148,650			165,587	1,421,397	1,464,691	12,509,077	12,069,817
Timing of revenue recognition
Goods transferred at a
point in time	3,846,498	4,182,086	318,094	274,276	6,197,363	5,483,985	577,075	499,192	-			-	1,421,397	1,464,691	12,360,427	11,904,230
Services transferred over time	-	-	-	-	-	-	-	-	148,650			165,587	-	-	148,650	165,587
	3,846,498	4,182,086	318,094	274,276	6,197,363	5,483,985	577,075	499,192	148,650			165,587	1,421,397	1,464,691	12,509,077	12,069,817

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Trafco Group B.S.C.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As at 31 March 2024 (Reviewed)

5 SEASONALITY OF RESULTS

Investment income for the three-month period ended 31 March 2024 amounting to BD 698,843 (2023: BD 734,331) is of a seasonal nature.

6 EARNINGS PER SHARE

The basic earnings per share is calculated by dividing the profit for the period attributable to shareholders of Trafco Group B.S.C. by the weighted average number of ordinary shares outstanding during the period, excluding the average number of ordinary shares purchased by the Company and held as treasury shares, as follows:

	Three-month period ended
	31 March (Reviewed)
	2024	2023
Profit for the period attributable to shareholders of Trafco - (BD)	958,076	880,183
Weighted average number of shares, net of treasury shares
74,197,575	74,197,575
Basic and diluted earnings per share (fils)	13	12

Basic and diluted earnings per share are the same as the Company has not issued any instruments that would have a dilutive effect.

7 FINANCIAL INSTRUMENTS

Set out below is an overview of the financial instruments held by the Group as at 31 March 2024 and 31 December 2023:

			Fair value
			through other
	Amortised comprehensive
	cost		income		Total
Financial assets	BD		BD		BD
At 31 March 2024 (Reviewed)
Investments at fair value through other comprehensive income	-	16,132,457	16,132,457
Trade and other receivables	13,433,228	-	13,433,228
Bank balances and cash	3,678,378	-	3,678,378
	17,111,606	16,132,457	33,244,063
			Fair value
			through other
	Amortised		comprehensive
	cost		income		Total
Financial assets	BD		BD		BD
At 31 December 2023 (Audited)
Investments at fair value through other comprehensive income	-	15,960,759	15,960,759
Trade and other receivables	10,676,652	-	10,676,652
Bank balances and cash	5,460,262	-	5,460,262
	16,136,914	15,960,759	32,097,673

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