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ContentsCompany ReviewCorporate Information .................................................................................02Directors’ Review ...........................................................................................04
Condensed Interim Unconsolidated Financial InformationAuditor’s Report to the Members on Review of Interim Financial Information .................................................................................10Condensed Interim Unconsolidated Statement of Financial Position................................................................11Condensed Interim Unconsolidated Profit & Loss Account ...............................................................................12Condensed Interim Unconsolidated Statement of Comprehensive Income ....................................................13Condensed Interim Unconsolidated Cash Flow Statement .................................................................................14Condensed Interim Unconsolidated Statement of Changes in Equity ...............................................................15Notes to the Condensed Interim Unconsolidated Financial Information ................................................................................16
Condensed Interim Consolidated Financial InformationDirectors’ Review on Condensed Interim Consolidated Financial Information ................................................................................30Condensed Interim Consolidated Statement of Financial Position................................................................32Condensed Interim Consolidated Profit & Loss Account ...............................................................................33Condensed Interim Consolidated Statement of Comprehensive Income ....................................................34Condensed Interim Consolidated Cash Flow Statement .................................................................................35Condensed Interim Consolidated Statement of Changes in Equity ...............................................................36Notes to the Condensed Interim Consolidated Financial Information ................................................................................37Investor’s Awareness
For the Half Year Ended 31 March 201801
Corporate Information
Board Of DirectorsMr. Jahangir Khan TareenDirector
Mukhdoom Syed Ahmed MahmudDirector / Chairman
Mr. Raheal MasudDirector / Chief Executive
Mrs. Samira Mahmud
Mr. Ijaz Ahmed
Mr. Asim Nisar Bajwa
Mr. Qasim Hussain Safdar
Chief Operating OfficerRana Nasim Ahmed
Group Director (Finance), CFO & Company SecretaryMr. Muhammad Rafique
Audit CommitteeMr. Qasim Hussain SafdarChairman / Member
Mrs. Samira MahmudMember
Mr. Ijaz AhmedMember
HR & R CommitteeMr. Ijaz AhmedChairman / Member
Mrs. Samira MahmudMember
Mr. Asim Nisar BajwaMember / Secretary
RegistrarCorplink (Pvt.) Ltd.
Unit-IMauza Shirin, Jamal Din Wali, District Rahim Yar Khan.
Unit-IIMachi Goth, Sadiqabad. District Rahim Yar Khan.
Unit-IIIMauza Laluwali, Near Village Islamabad, District Ghotki.
Mills
JDW Sugar Mills Limited02
Bankers Conventional Faysal Bank LimitedMCB Bank LimitedThe Bank of PunjabNational Bank of PakistanStandard Chartered Bank (Pakistan) LimitedAllied Bank LimitedUnited Bank LimitedAskari Bank LimitedSoneri Bank LimitedHabib Bank LimitedHabib Metropolitan Bank Limited
IslamicNational Bank of Pakistan Askari Bank Limited Bank Alfalah LimitedMCB Islamic Bank LimitedMeezan Bank LimitedDubai Islamic Bank Pakistan LimitedBankIslami (Pakistan) Limited
Web Presencewww.jdw-group.com
Registered Office17-Abid Majeed Road, Lahore Cantonment,
Lahore.
AuditorsKPMG Taseer Hadi & Co.Chartered Accountants
Legal AdvisorCornelius, Lane & Mufti
For the Half Year Ended 31 March 201803
Directors’ Review
Dear Shareholders,
We, on behalf of the Board of Directors of JDW Sugar Mills Limited, are pleased to present the Condensed interim financial information of the Company for the half year ended on March 31, 2018 which has been duly reviewed by the external Auditors.
During the period under review the Company has earned profit after tax amounting to Rs. 253 million with gross sales of Rs.17,183 million as compared to net profit after tax amounting to Rs.1,729 million with gross sales of Rs.21,010 million in the same period last year.
Other salient features of the period under review are summarized below:
• For crushing season 2017-18 which concluded on different dates for all the four units the following operating results were achieved:
Operating Results 2017-18 2016-17Description Unit JDW-I JDW-II JDW-III COMBINED JDW-I JDW-II JDW-III COMBINEDSugarcane Crushed M.Tons 3,753,175 2,428,571 2,240,689 8,422,435 3,528,599 2,373,561 2,016,687 7,918,847Sugar Production M.Tons 409,507 255,879 223,325 888,711 357,733 247,926 207,747 813,406Sucrose Recovery %age 10.91 10.54 9.97 10.55 10.14 10.45 10.30 10.27Molasses Production M.Tons 177,607 127,340 110,000 414,947 154,437 110,324 83,072 347,833Molasses Recovery %age 4.73 5.24 4.91 4.93 4.38 4.65 4.12 4.39
Sugarcane crushed this time was 6% higher than last crushing season whereas increase in sugar production was 9% more which can solely be attributable to 28 bps improvement in combined sucrose recovery. Though there was increase in area under cultivation but due to low yield per acre experienced by the growers the expected increase in cane crushing about 15% could not be achieved. Inadequate rains was the main reason which resulted in low yield per acre this time. Sucrose recoveries of unit-I and II were better than last season whereas reduction in recovery for unit-III was due to pest attack on the sugarcane crop.
• Deharki Sugar Mills (Pvt) Ltd. (DSML) being wholly owned subsidiary of the Company has achieved the following operating results during crushing season 2017-18.
2017-18 2016-17Sugarcane Crushed M.Tons 1,890,612 1,950,674Sugar Production M.Tons 205,788 205,041Sucrose Recovery %age 10.89 10.51Molasses Production M.Tons 77,701 81,187Molasses Recovery %age 4.11 4.16
Financial Results (unconsolidated)
31-Mar-18 31-Mar-17Gross Sales Rs. in million 17,183 21,010Gross Profit Rs. in million 348 3,754Gross Profit Ratio % age 2 19Profit After Tax Rs. in million 253 1,729 Earnings Per Share Rs. 4.24 28.92
• Gross sales of the Company in the current period was Rs. 17.183 billion as compared to corresponding period of Rs. 21.01 billion, the gross sales declined by 18% even after selling almost similar quantity of sugar in the current period due to decrease in average selling prices of sugar and molasses. Company earned profit after tax amounting to Rs. 253 million as compared to profit after tax of Rs. 1,729 million in the corresponding period, resultantly earnings per share has reduced from Rs. 28.92 to Rs. 4.24. Our group units have paid support prices of sugarcane in the Province of Punjab and notified prices in the Province of Sindh. Moreover, sugar sale rate fixed by FBR for sales tax purposes is much higher than the actual market price had also adversely affected our profitability in the current period. In these adverse circumstances for sugar industry, where industry projects heavy losses our Company has been able to escape negative results because of better sucrose recovery achieved and comparatively more working days for co-generation plants.
• Increase in selling expenses is attributable to freight on sugar export and substantial increase in other income is due to accrual of sugar export subsidy on exports made by the Company.
JDW Sugar Mills Limited04
• There has been an increase of Rs. 123 million in the financial charges of the Company as compared to corresponding period due to more utilization of working capital lines in the current period to meet its working capital requirements and 50 bps increase in the base rate by the State Bank of Pakistan.
• The balance sheet size has increased to Rs. 66 billion from Rs. 35 billion. Accumulated reserves are approximately 13 times of the paid up capital of the Company.
• In view of the above referred financial results all key financial covenants’ have shown slight deterioration as compared to comparative period and year end financial results of 30 September 2017. The Company is fulfilling it’s all financial obligations on time and enjoys cordial relationship with all the financial institutions it’s dealing with.
• Honorable Sindh High Court had provided relief to the Mills in Sindh by reducing the sugarcane purchase rate from Rs. 182 per 40 kgs to Rs. 172 per 40 kgs from 23 December, 2017 for the crushing season 2017-18 through its order C.P.No.D-8666 of 2017. On 30 January 2018, Honorable Sindh High Court had further reduced the rate from Rs. 172 per 40 kgs to Rs. 160 per 40 kgs for the crushing season 2017-18 through its final order C.P. No.D-8666 of 2017, 7951 of 2017, 219 of 2018 and 440 of 2018 and stands modified the earlier order of December 2017. The group has strictly followed court orders for purchase and payment of sugarcane for its units located in the Province of Sindh.
• In view of the expected higher sugar production in the country the Federal Govt. has allowed
in December 2017 export of 1,500,000 tons of sugar for crushing season 2017-18 with freight support of Rs. 10.70/kg subject to the condition that the said amount of freight support will be given on a sliding scale between the international price of US$376/MT and $499/MT, i.e. once the price reaches at the level of $499/MT in international market, the State Bank of Pakistan would affect the stoppage of the freight support. Freight support will be shared by federal and provincial government on 50:50 basis. Company on group basis has made export of 191,098 tons of sugar up to 21 May 2018 but has not received even a single penny on account of subsidy from SBP so far for export allocation of 1.5 million tons. On overall sugar industry basis approx. Rs. 20 Billion is stuck up on account of export subsidies which has pushed the industry in severe cash flows problems causing delays in releasing growers payments by the mills.
• To bailout the sugar industry, Sindh Government also approved in its provincial cabinet meeting an additional cash freight support of Rs. 9.30/kg on export of sugar. This relief has been restricted to export of 20,000 tons of sugar for each mills located in the province. This subsidy is in addition to its share of 50% in the cash freight support of Rs. 10.70/kg allowed by the Federal Government. Company is in the process to collect all the required documents as per notification for submission of subsidy claims.
• As usual growers’ payment has remained our top priority being one of main keys of our success but this time there has been some delays in fully settling the growers’ payments. This has happened due to stuck up of huge funds with Government on account of export subsidy & sale of energy. Collapse of sugar prices owing to surplus sugar production had also played negative role. The Honorable Supreme Court has directed on 26 April, 2018 to all the mills to make balance payment of growers at support/notified prices latest by 31 May, 2018. We are trying our best and would hopefully be able to achieve this target. We are proud of the fact that we are among few sugar mills in Pakistan which have procured sugarcane at support price in Punjab and at notified price in Sindh in such a difficult season in which there is a big mismatch between the cost of sugar and prevailing sugar prices. Company regularly provides financial and technical support to its growers. Due to these policies and preferential treatment to growers Company enjoys excellent relationship with them.
• Year under review was relatively a difficult year for the sugar industry due to surplus production, unfavorable sugar prices and no timely support from the Govt. to bailout the industry. Imposition of 15% Regulatory Duty by the previous Government on export of molasses is causing loss of approx. Rs. 1,500 to Rs. 2,000 per ton of molasses at prevailing export price of molasses to each mill having no distillery set up which is discriminately and not giving level playing field. Abolishing of Regulatory Duty on export of molasses would help the sugar industry to get better prices of molasses.
• In view of maintaining continued good performance we want to focus more on value addition of its by-products, making its processes more efficient and saving more bagasse from the system.
Lahore:22 May 2018 Chief Executive Director
For the Half Year Ended 31 March 201805
JDW Sugar Mills Limited06
For the Half Year Ended 31 March 201807
JDW Sugar Mills Limited08
CONDENSED INTERIM UNCONSOLIDATED
FINANCIAL INFORMATION (UN-AUDITED)
For the Half Year Ended 31 March 201809
Auditor’s Report to the MembersON REVIEW OF INTERIM FINANCIAL INFORMATION
IntroductionWe have reviewed the accompanying condensed interim unconsolidated statement of financial position of JDW Sugar Mills Limited (“the Company”) as at 31 March 2018 and the related condensed interim unconsolidated profit and loss account, condensed interim unconsolidated statement of comprehensive income, condensed interim unconsolidated cash flow statement, condensed interim unconsolidated statement of changes in equity and notes to the accounts for the six month period then ended (here-in-after referred as the “interim financial information”). Management is responsible for the preparation and presentation of this condensed interim unconsolidated financial information in accordance with approved accounting standards as applicable in Pakistan for interim financial reporting. Our responsibility is to express a conclusion on this condensed interim unconsolidated financial information based on our review.
Scope of review We conducted our review in accordance with International Standard on Review Engagements 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity.” A review of condensed interim unconsolidated 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 condensed interim unconsolidated financial information is not prepared, in all material respects, in accordance with approved accounting standards as applicable in Pakistan for interim financial reporting.
Other mattersThe figures of the condensed interim unconsolidated profit and loss account and condensed interim unconsolidated statement of comprehensive income for the quarter ended 31 March 2018, have not been reviewed and we do not express a conclusion on them.
22 May 2018 KPMG Taseer Hadi & Co.Lahore Chartered Accountants (M. Rehan Chughtai)
Telephone + 92 (42) 111 576 484Fax + 92 (42) 3742 9907Internet www.kpmg.com.pk
KPMG Taseer Hadi & Co.Chartered Accountants351 Shadman-1, Jail Road Lahore, Pakistan.
KPMG Taseer Hadi & Co., a Partnership firm registered in Pakistanand a member firm of the KPMG network of independent memberfirms affiliated with KPMG International Cooperative(‘‘KPMG International’’), a Swiss entity
JDW Sugar Mills Limited10
Condensed Interim Unconsolidated Statement of Financial Position (Un-audited) AS AT 31 MARCH 2018
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees
EQUITY AND LIABILITIESSHARE CAPITAL AND RESERVES Share capital 6 597,766,610 597,766,610 Share premium reserve 678,316,928 678,316,928 Accumulated profit 7,226,707,182 7,152,880,785 8,502,790,720 8,428,964,323 NON-CURRENT LIABILITIES Redeemable capital - secured 7 – –Long term finances - secured 8 8,416,256,143 9,792,313,674 Liabilities against assets subject to finance lease - secured 9 141,536,414 153,047,674 Deferred taxation 1,895,544,612 1,818,467,413 Retirement benefits 34,663,435 29,618,756 10,488,000,604 11,793,447,517 CURRENT LIABILITIESShort term borrowings - secured 10 20,702,565,153 10,053,163,155 Current portion of non-current liabilities 3,699,053,324 3,368,757,109 Trade and other payables 11 21,941,028,707 8,310,801,726 Unclaimed dividend 34,332,107 64,248,402 Accrued profit / interest / mark-up 324,828,575 226,191,820 46,701,807,866 22,023,162,212 65,692,599,190 42,245,574,052CONTINGENCIES AND COMMITMENTS 12
ASSETSNON-CURRENT ASSETS Property, plant and equipment 13 21,602,721,569 21,058,980,010 Biological assets – 14,595,399 Intangibles 619,869,151 620,889,016 Investment property 218,599,597 218,599,597 Long term investments 14 2,308,810,383 2,303,378,840 Long term advances – 3,272,223 Long term deposits 31,356,989 54,978,065 24,781,357,689 24,274,693,150 CURRENT ASSETS Stores, spare parts and loose tools 1,793,498,215 1,412,675,360 Stock-in-trade 30,250,130,805 7,939,757,487 Biological assets 549,856,217 2,282,737,798 Trade debts - unsecured considered good 3,748,167,253 3,234,430,508 Advances, deposits, prepayments and other receivables 15 3,237,002,571 2,182,572,665 Advance tax - net 956,478,834 784,949,809 Cash and bank balances 16 376,107,606 133,757,275 40,911,241,501 17,970,880,902 65,692,599,190 42,245,574,052
The annexed notes from 1 to 25 form an integral part of this condensed interim unconsolidated financial information.
Chief Financial Officer Chief Executive Director
For the Half Year Ended 31 March 201811
Condensed Interim Unconsolidated Profit and Loss Account (Un-audited) FOR THE HALF YEAR AND QUARTER ENDED 31 MARCH 2018
Chief Financial Officer Chief Executive Director
Six months ended Three months ended Note 31-Mar-18 31-Mar-17 31-Mar-18 31-Mar-17 Rupees Rupees Rupees Rupees
Gross sales 17,183,480,882 21,009,975,635 7,970,525,816 9,158,257,322 Sales tax and others (1,171,216,304) (1,632,519,213) (290,020,620) (615,908,898)Net sales 17 16,012,264,578 19,377,456,422 7,680,505,196 8,542,348,424 Cost of sales (15,664,048,261) (15,623,749,096) (7,466,569,750) (6,287,573,554)Gross profit 348,216,317 3,753,707,326 213,935,446 2,254,774,870 Administrative expenses (561,678,832) (688,522,342) (308,088,193) (436,418,782)Selling expenses (146,503,870) (41,563,254) (133,948,823) (31,734,333)Other income 18 1,609,486,143 208,147,190 1,268,346,536 147,779,378 Other expenses (17,393,133) (152,415,212) (17,393,133) (93,567,479) 883,910,308 (674,353,618) 808,916,387 (413,941,216)Profit from operations 1,232,126,625 3,079,353,708 1,022,851,833 1,840,833,654 Finance cost (901,657,104) (778,348,024) (510,114,257) (445,353,627)Profit before taxation 330,469,521 2,301,005,684 512,737,576 1,395,480,027 Taxation (77,313,141) (572,242,612) (219,372,405) (428,302,516)Profit after taxation 253,156,380 1,728,763,072 293,365,171 967,177,511
Earnings per share - basic and diluted 4.24 28.92 4.91 16.18
The annexed notes from 1 to 25 form an integral part of this condensed interim unconsolidated financial information.
JDW Sugar Mills Limited12
Chief Financial Officer Chief Executive Director
Condensed Interim Unconsolidated Statement of Comprehensive Income (Un-audited) FOR THE HALF YEAR AND QUARTER ENDED 31 MARCH 2018
Six months ended Three months ended 31-Mar-18 31-Mar-17 31-Mar-18 31-Mar-17 Rupees Rupees Rupees Rupees
Profit after taxation for the period 253,156,380 1,728,763,072 293,365,171 967,177,511 Other comprehensive income for the period – – – – Total comprehensive income for the period 253,156,380 1,728,763,072 293,365,171 967,177,511
The annexed notes from 1 to 25 form an integral part of this condensed interim unconsolidated financial information.
For the Half Year Ended 31 March 201813
Chief Financial Officer Chief Executive Director
31-Mar-18 31-Mar-17 Rupees RupeesCASH FLOW FROM OPERATING ACTIVITIES Profit before taxation 330,469,521 2,301,005,684 Adjustments for non cash and other items: Finance cost 901,657,104 778,348,024 Depreciation 688,501,235 782,106,242 Amortization 1,019,864 1,019,864 Staff retirement benefits 47,940,927 46,093,141 Workers’ profit participation fund 17,393,133 122,671,045 Assets written off 130,447 – Gain on disposal of operating fixed assets (62,197,691) (6,903,459) Fair value gain on biological assets (21,669,571) (35,747,665) Workers’ welfare fund – 29,744,168 Provision for doubtful debts – 24,716,942 Gain on disposal of investment property – (21,280,886) 1,572,775,448 1,720,767,416 Operating profit before working capital changes 1,903,244,969 4,021,773,100 (Increase) / decrease in current assets: Stores, spare parts and loose tools (380,822,855) 16,237,495 Stock-in-trade (22,310,373,318) (22,057,062,445) Biological assets 1,769,146,551 1,637,317,271 Advances, deposits, prepayments and other receivables (1,012,181,525) (1,443,265,057) Trade debts - unsecured considered good (513,736,745) (844,131,622) (22,447,967,892) (22,690,904,358)Increase in current liabilities: Trade and other payables 13,620,407,050 9,862,918,609 Cash used in operations (6,924,315,873) (8,806,212,649) Taxes paid (171,764,967) (240,071,197) Workers’ profit participation fund paid (66,885,632) (124,461,119) Staff retirement benefits paid (46,164,141) (141,157,386) (284,814,740) (505,689,702)Net cash used in operations (7,209,130,613) (9,311,902,351)CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditure (1,302,803,259) (827,480,337) Long term advances 12,027,777 14,027,777 Advances for issuance of shares (5,431,543) (13,593,901) Proceeds from sale of operating fixed assets 158,849,209 17,243,381 Long term deposits - net 23,621,076 58,443,325 Proceeds from sale of investment property – 37,437,422Net cash used in investing activities (1,113,736,740) (713,922,333) CASH FLOW FROM FINANCING ACTIVITIES Long term finances - net (1,031,915,972) (794,930,196) Short term borrowings - net 11,041,276,681 14,466,974,984 Finance cost paid (743,707,918) (519,752,175) Dividend paid (209,246,278) (888,737,458) Lease rentals paid (99,314,146) (518,166,617)Net cash generated from financing activities 8,957,092,367 11,745,388,538 Net increase in cash and cash equivalents 634,225,014 1,719,563,854 Cash and cash equivalents at beginning of the period (2,374,033,959) (2,205,907,300)Cash and cash equivalents at end of the period (1,739,808,945) (486,343,446)
Cash and cash equivalents comprise of the following: - Cash and Bank balances 376,107,606 524,997,663 - Running finances and morabaha finances (2,115,916,551) (1,011,341,109) (1,739,808,945) (486,343,446)The annexed notes from 1 to 25 form an integral part of this condensed interim unconsolidated financial information.
Condensed Interim Unconsolidated Cash flow Statement (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
JDW Sugar Mills Limited14
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Condensed Interim Unconsolidated Statement of Changes in Equity (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
For the Half Year Ended 31 March 201815
1 REPORTING ENTITY JDW Sugar Mills Limited (“the Company”) was incorporated in Pakistan on 31 May
1990 as a private limited company and was subsequently converted into a public limited company on 24 August 1991. Shares of the Company are listed on the Pakistan Stock Exchange Limited. The registered office of the Company is situated at 17-Abid Majeed Road, Lahore Cantonment, Lahore. The principal activity of the Company is production and sale of crystalline sugar, electricity and managing corporate farms. The production facilities of the Company are located at following geographical locations:
Unit-I Mauza Shirin, Jamal Din Wali, District Rahim Yar Khan Unit-II Machi Goth, Sadiqabad, District Rahim Yar Khan Unit-III Mauza Laluwali, Near Village Islamabad, District Ghotki 2 BASIS OF PREPARATION
2.1 Basis of accounting2.1.1 This condensed interim unconsolidated financial information comprises the
condensed interim unconsolidated statement of financial position of the Company as at 31 March 2018 and the related condensed interim unconsolidated profit and loss account, condensed interim unconsolidated statement of comprehensive income, condensed interim unconsolidated cash flow statement and condensed interim unconsolidated statement of changes in equity together with the notes forming part thereof for the period from 01 October 2017 to 31 March 2018.
2.1.2 This condensed interim unconsolidated financial information has been prepared
in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting comprise of:
– International Accounting Standard (IAS) 34, ‘‘Interim Financial Reporting,’’ issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017;
– Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as notified under the Companies Act, 2017; and
– Provisions of and directives issued under the Companies Act, 2017. Where the provisions of and directives issued under the Companies Act, 2017
differ with the requirements of IAS 34 or IFAS, the provisions of and directives issued under the Companies Act, 2017 have been followed.
2.1.3 This condensed interim unconsolidated financial information does not include all of the information required for full annual financial statements and should be read in conjunction with the annual financial statements for the year ended 30 September 2017.
2.1.4 Comparative unconsolidated statement of financial position numbers are extracted
from the annual audited unconsolidated financial statements of the Company for the year ended 30 September 2017, whereas comparative figures of unconsolidated profit and loss account, statement of comprehensive income, cash flow statement and statement of changes in equity are stated from unaudited condensed interim financial information of the Company for the six months period ended 31 March 2017.
2.1.5 This condensed interim unconsolidated financial information is unaudited and being
submitted to the shareholders as required under Section 237 of the Companies Act, 2017 and the Listing Regulations of Pakistan Stock Exchange Limited.
Notes to the Condensed Interim Unconsolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
JDW Sugar Mills Limited16
3 USE OF ESTIMATES AND JUDGMENTS The preparation of the condensed interim unconsolidated financial information requires
management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.
In preparing the condensed interim unconsolidated financial information, the significant
judgements made by the management in applying accounting policies and the key source of estimation uncertainty are the same as those applied in the preparation of audited unconsolidated financial statements for the year ended 30 September 2017.
4 STATEMENT OF CONSISTENCY IN ACCOUNTING POLICIES
4.1 The accounting policies and the methods of computation adopted in the preparation of the condensed interim unconsolidated financial information are same as those applied in the preparation of the audited unconsolidated financial statements for the year ended 30 September 2017.
4.2 Effective 01 January 2018, the provisions of the Companies Act, 2017 relating
to the preparation of the financial statements have become applicable. However, there is no major impact of these provisions on the Company’s condensed interim unconsolidated financial information.
4.3 The following amendments and interpretations of approved accounting standards
will be effective for accounting periods as detailed below: Effective date (accounting periods Standard or interpretation beginning on or after)
IFRS 2 – Share-based Payments 01 January 2018 IAS 40 – Investment Property 01 January 2018 IAS 28 – Investments in Associates and Joint Ventures 01 January 2018 IFRIC 22 – Foreign Currency Transactions and Advance Consideration 01 January 2018 IFRIC 23 – Uncertainty over Income Tax Treatments 01 January 2019 IFRS 15 – Revenue from Contract with Customer 01 July 2018 IFRS 9 – Financial Instruments 01 July 2018 IAS 28 – Investments in Associates and Joint Ventures 01 January 2019 IFRS 3 – Business Combinations 01 January 2019 IFRS 11 – Joint Ventures 01 January 2019 IAS 12 – Income Taxes 01 January 2019 IAS 23 – Borrowing Cost 01 January 2019 5 SEASONALITY OF OPERATIONS Due to seasonal nature of sugar segment, operating results of sugar and co-generation
power are expected to fluctuate in the second half of the year.
The sugarcane crushing season normally starts from November and lasts till April each year.
For the Half Year Ended 31 March 201817
(Un-audited) (Audited) 31-Mar-18 30-Sep-17 Rupees Rupees
6 SHARE CAPITAL
6.1 Authorized share capital 75,000,000 (30 September 2017: 75,000,000) 750,000,000 750,000,000 ordinary shares of Rs. 10 each 25,000,000 (30 September 2017: 25,000,000) preference shares of Rs. 10 each 250,000,000 250,000,000 1,000,000,000 1,000,000,000 6.2 Issued, subscribed and paid up share capital 32,145,725 (30 September 2017: 32,145,725) ordinary shares of Rs. 10 each fully paid in cash 321,457,250 321,457,250 27,630,936 (30 September 2017: 27,630,936) bonus shares of Rs. 10 each fully paid 276,309,360 276,309,360 597,766,610 597,766,610
7 REDEEMABLE CAPITAL - SECURED
During the period, the Company has repaid Rs. 55.55 million (year ended 30 September 2017: Rs. 111.11 million ) to TFC holders. Amounts due in next twelve months amounting to Rs. 27.77 million (year ended 30 September 2017: Rs. 83.33 million) are included in current portion presented under current liabilities. These carry mark-up at three months KIBOR plus 100 bps per annum.
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees
8 LONG TERM FINANCES - SECURED
Markup bearing finances from conventional banks 8.1 6,543,897,156 7,621,383,792Islamic mode of financing 8.2 1,872,358,987 2,170,929,882 8.3 8,416,256,143 9,792,313,674 8.1 Markup bearing finances from conventional banks: Balance at beginning of the period / year 10,428,383,065 10,955,666,181 Finances received during the period / year 8.1.1 534,033,839 1,965,966,161 Repayments during the period / year (1,399,124,640) (2,493,249,277) 9,563,292,264 10,428,383,065 Current portion presented under current liabilities (3,019,395,108) (2,806,999,273) 6,543,897,156 7,621,383,792
Notes to the Condensed Interim Unconsolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
JDW Sugar Mills Limited18
Markup Duration
Grace Amount basis period (Rupees)
8.1.1 Finances received during the period Askari Bank Limited 3mk + 1.00 05 Years 01 Year 500,000,000 National Bank of Pakistan Limited (II) 3mk + 0.50 05 Years 01 Year 34,033,839 534,033,839
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees
8.2 Islamic mode of financing: Balance at beginning of the period / year 2,495,929,882 1,264,000,000 Finances received during the period / year 8.2.1 35,230,389 1,463,179,882 Repayments during the period / year (146,500,000) (231,250,000) 2,384,660,271 2,495,929,882 Current portion presented under current liabilities (512,301,284) (325,000,000) 1,872,358,987 2,170,929,882
Profit / Interest Duration
Grace Amount basis period (Rupees)
8.2.1 Finances received during the period Bank Alfalah Limited 3mk + 0.90 05 Years 01 Year 35,230,389 * 3 mk i.e. 3 months KIBOR 8.3 The securities offered and facility limits of these long term finances are the same
as disclosed in the audited unconsolidated financial statements of the Company for the year ended 30 September 2017, except as disclosed in note 8.1.1. The interest / markup is payable quarterly / semi annually at a rate of three to six months KIBOR plus 50 bps to 100 bps per annum.
9 LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE - SECURED During the period, the Company availed leases aggregating Rs. 63.96 million (year
ended 30 September 2017: Rs. 76.50 million) and repaid principal amount of Rs. 89.31 million (year ended 30 September 2017: Rs. 569.85 million). Amounts due in next twelve months amounting to Rs. 139.58 million (year ended 30 September 2017: Rs. 153.42 million) are included in current portion presented under current liabilities. Lease rentals are payable on quarterly / monthly basis and include finance cost ranging from three months to one year KIBOR plus 100 bps per annum (year ended 30 September 2017: three months to one year KIBOR plus 100 to 300 bps per annum) which has been used as the discounting factor. The Company has the option to purchase the assets upon completion of lease period and has the intention to exercise such option.
For the Half Year Ended 31 March 201819
(Un-audited) (Audited) 31-Mar-18 30-Sep-17 Rupees Rupees10 SHORT TERM BORROWINGS - SECURED
10.1 Type of short term borrowings 10.1.1 Markup based borrowings from conventional banks Cash finances 11,258,203,337 6,393,802,000 Running finances 1,815,916,551 1,457,791,234 Inland bill discounting 899,999,998 884,999,998 Finance against trust receipts 409,446,899 266,569,923 14,383,566,785 9,003,163,155 10.1.2 Islamic mode of financing Salam / Istisna finances 6,018,998,368 – Morabaha finances 300,000,000 1,050,000,000 6,318,998,368 1,050,000,000 20,702,565,153 10,053,163,155 10.2 The Company has obtained these facilities from various banks and financial
institutions. The markup rate applicable during the period ranges from one to six months KIBOR plus 0 (zero) to 135 bps per annum (year ended 30 September 2017: one to six months KIBOR plus 20 to 135 bps per annum).
10.3 The securities offered are the same as disclosed in the audited unconsolidated
financial statements of the Company for the year ended 30 September 2017 whereas facility limits have increased to Rs. 26,355 million (year ended 30 September 2017: Rs. 24,715 million).
11 TRADE AND OTHER PAYABLES This includes advances from customers aggregating Rs. 8,541.31 million (year ended 30
September 2017: Rs. 6,418.36 million).
12 CONTINGENCIES AND COMMITMENTS 12.1 Contingencies There is no material change in contingencies from the preceding audited
unconsolidated financial statements of the Company for the year ended 30 September 2017, except for the guarantees and commitments as disclosed below:
(Un-audited) (Audited) 31-Mar-18 30-Sep-17 Rupees Rupees
Guarantees issued by banks on behalf of the Company in favour of various parties 443,187,500 83,000,000 12.2 Commitments Letters of credit for import of machinery and its related components 233,391,193 569,509,835
Notes to the Condensed Interim Unconsolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
JDW Sugar Mills Limited20
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees13 PROPERTY, PLANT AND EQUIPMENT
Operating fixed assets 13.1 21,210,082,186 19,183,947,822 Capital work in progress 13.2 279,198,418 1,785,030,726 Stores, spare parts and loose tools held for capital expenditure 113,440,965 90,001,462 21,602,721,569 21,058,980,010 13.1 Operating fixed assets Net book value at beginning of the period / year 19,183,947,822 18,533,844,373 Additions during the period / year 2,819,077,762 2,027,221,640 Disposals during the period / year - net book value (96,781,965) (51,194,369) Transfer to investment property – (38,288,435) Depreciation charged during the period / year (696,161,433) (1,287,635,387) Net book value at end of the period / year 21,210,082,186 19,183,947,822 13.2 Capital work in progress Opening balance 1,785,030,726 924,081,851 Addition during the period / year 825,827,602 2,174,535,113 Transfers made duirng the period / year (2,331,659,910) (1,313,586,238) Closing balance 279,198,418 1,785,030,726
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees
14 LONG TERM INVESTMENTS
Investment in subsidiary companies - unquoted 14.1 2,308,810,383 2,303,378,840Investment in associated company - unquoted 14.2 – – 2,308,810,383 2,303,378,840
For the Half Year Ended 31 March 201821
(Un-audited) (Audited) 31-Mar-18 30-Sep-17 Rupees Rupees
14.1 Investment in subsidiary companies - unquoted Deharki Sugar Mills (Private) Limited (“DSML”) 104,975,000 (30 September 2017: 104,975,000) fully paid shares of Rs. 10 each Equity held 100% (30 September 2017: 100%) 1,049,750,000 1,049,750,000 Faruki Pulp Mills Limited (“FPML”) 310,892,638 (30 September 2017: 310,892,638) fully paid ordinary shares of Rs. 10 each Equity held 57.67% (30 September 2017: 57.67%) 3,154,426,383 3,154,426,383 Accumulated impairment allowance (1,921,066,000) (1,921,066,000) 1,233,360,383 1,233,360,383 Sadiqabad Power (Private) Limited (“SPL”) 1,000,100 fully paid shares of Rs. 10 each Equity held 100% (30 September 2017: nil) 10,001,000 – Advances for future issuance of shares 2,849,000 10,133,876 12,850,000 10,133,876 Ghotki Power (Private) Limited (“GPL”) 1,000,100 fully paid shares of Rs. 10 each Equity held 100% (30 September 2017: nil) 10,001,000 – Advances for future issuance of shares 2,849,000 10,134,581 12,850,000 10,134,581 2,308,810,383 2,303,378,840 14.2 Investment in associated company - unquoted JDW Power (Private) Limited (“JDWPL”) 9,000,000 (30 September 2017: 9,000,000) fully paid shares of Rs. 10 each Equity held 47.37% (30 September 2017: 47.37%) 90,000,000 90,000,000 Accumulated impairment allowance (90,000,000) (90,000,000) – –
15 ADVANCES, DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES This includes an amount of Rs. 5.44 million (year ended 30 September 2017: Rs. 6.32
million) receivable from executives of the Company.
Notes to the Condensed Interim Unconsolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
JDW Sugar Mills Limited22
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees16 CASH AND BANK BALANCES
Current accounts Deposit with conventional banks 249,079,969 114,843,981 Deposit with islamic banks 38,749,540 14,007,219 287,829,509 128,851,200 Saving accounts Deposit with conventional banks 16.1 6,314,118 2,264,620 294,143,627 131,115,820 Cash in hand 81,963,979 2,641,455 376,107,606 133,757,275 16.1 The balances in saving accounts carry markup at 3.75% to 4.00% per annum
(year ended 30 September 2017: 3.75% per annum).
Six months ended Three months ended 31-Mar-18 31-Mar-17 31-Mar-18 31-Mar-17 Rupees Rupees Rupees Rupees
17 NET SALES
Sugar 12,956,703,744 16,192,668,711 5,485,160,101 6,257,914,827 Electricity 2,265,731,275 2,008,739,315 1,171,298,039 1,147,504,060 Agriculture produce 720,209,190 1,206,048,504 449,511,598 647,207,041 Molasses - by product 1,006,900,384 1,594,965,955 686,830,525 1,098,078,244 Bagasse - by product 63,195,880 7,553,150 7,910,434 7,553,150 Agri Inputs 170,740,409 – 169,815,119 – 17,183,480,882 21,009,975,635 7,970,525,816 9,158,257,322 Less: Sales tax and others (1,171,216,304) (1,632,519,213) (290,020,620) (615,908,898) 16,012,264,578 19,377,456,422 7,680,505,196 8,542,348,424 Sales include sugar export sales of Rs. 4,753 million (31 March 2017: Rs. 1,659 million). 18 OTHER INCOME This mainly includes subsidy aggregating Rs. 1,379 million (31 March 2017: Rs. nil) from
Federal Government and Provincial Government on export of sugar, scrap sale of Rs. 20.49 million (31 March 2017: Rs. 71.17 million), sale of mud of Rs. 93.72 million (31 March 2017: Rs. 63.68 million), fair value gain on biological assets of Rs. 21.67 million (31 March 2017: Rs. 35.75 million) and gain on sale of operating fixed assets of Rs. 62.20 million (31 March 2017: Rs. 6.90 million).
For the Half Year Ended 31 March 201823
19 TRANSACTIONS WITH RELATED PARTIES The related parties comprise of subsidiary companies, associated company, other
related companies, directors of the Company and entities under common directorship, key management personnel and post employment benefit plans. Amount due from and due to related parties are shown under respective notes to this condensed interim unconsolidated financial information. Other significant transactions and balances with related parties except those disclosed elsewhere are as follows:
31-Mar-18 31-Mar-17 Rupees Rupees
Name of Company Relationship Transactions
i) Deharki Sugar Mills Subsidiary Company Short term (Pvt) Limited (Equity held 100 percent) advances - net 704,300,000 987,814,170 Markup expense on short term advances - net 12,025,630 1,812,560 Sale of sugarcane 716,277,476 1,177,778,578 Purchase of bagasse 133,600,968 – Rent on Land acquired on lease 5,008,092 – Reimbursement on use of Company’s aircraft 4,697,544 4,953,091 Proceeds from sale of operating fixed assets – 2,792,037 ii) Sadiqabad Power Subsidiary Company Investment in shares 10,001,000 – (Pvt) Limited (Equity held 100 percent) Advances for future issuance of shares 2,849,000 6,714,436 iii) Ghotki Power Subsidiary Company Investment in shares 10,001,000 – (Pvt) Limited (Equity held 100 percent) Advances for future issuance of shares 2,849,000 6,879,465 iv) JDW Aviation Associated Company Reimbursement of (Pvt) Limited (Due to common expenses 6,772,024 10,413,370 directorship) v) Post Employment Provident fund Benefits Plan contribution 78,838,676 74,306,206 Payment to recognised gratuity fund 3,476,910 101,168,252 vi) Key Management Consultancy services 5,824,128 7,129,691 Personnel Directors’ remuneration and allowances 145,796,668 168,213,335
Notes to the Condensed Interim Unconsolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
JDW Sugar Mills Limited24
20 F
AIR
VA
LUE
MEA
SUR
EMEN
T O
F FI
NA
NC
IAL
INST
RU
MEN
TSTh
e fo
llow
ing
tabl
e sh
ows
the
carry
ing
amou
nts
and
fair
valu
es o
f fina
ncia
l ass
ets
and
finan
cial
liab
ilitie
s, in
clud
ing
thei
r lev
els
in th
e fa
ir va
lue
hier
arch
y fo
r fin
anci
al in
stru
men
ts m
easu
red
at fa
ir va
lue.
It d
oes
not i
nclu
de fa
ir va
lue
info
rmat
ion
for fi
nanc
ial a
sset
s an
d fin
anci
al li
abilit
ies
not m
easu
red
at fa
ir va
lue
if th
e ca
rryin
g am
ount
is a
reas
onab
le a
ppro
xim
atio
n of
fair
valu
e.
31 M
arch
2018
(un-
audit
ed)
Ca
rrying
Amo
unt
Fair V
alue
Lo
ans a
nd
Othe
r fina
ncial
rec
eivab
les
liabil
ities
Total
Le
vel 1
Le
vel 2
Le
vel 3
No
te (R
upee
s)
On-B
alanc
e she
et fi
nanc
ial in
stru
men
ts
Fi
nanc
ial as
sets
not
mea
sure
d at
fair
valu
e
Cash
and b
ank b
alanc
es
37
6,107
,606
–
376,1
07,60
6 –
– –
Ad
vanc
es, d
epos
its an
d othe
r rec
eivab
les
22
6,180
,788
– 22
6,180
,788
– –
–
Tr
ade d
ebts
- uns
ecur
ed co
nside
red g
ood
3,
748,1
67,25
3 –
3,74
8,167
,253
– –
–
Long
term
adva
nces
– –
– –
– –
Lo
ng te
rm de
posit
s
31,35
6,989
–
31
,356,9
89
– –
–
20.2
4,38
1,812
,636
– 4,
381,8
12,63
6 –
– –
Fi
nanc
ial lia
biliti
es n
ot m
easu
red
at fa
ir va
lue
Re
deem
able
capit
al - s
ecur
ed
–
27
,777,7
73
27,77
7,773
–
– –
Lo
ng te
rm fin
ance
s - se
cure
d
–
11,94
7,952
,535
11,94
7,952
,535
– –
–
Liabil
ities a
gains
t ass
ets su
bject
t
o fina
nce l
ease
- se
cure
d
–
281,1
15,57
3 28
1,115
,573
– –
–
Trad
e and
othe
r pay
ables
– 13
,210,3
02,78
0 13
,210,3
02,78
0 –
– –
Sh
ort te
rm bo
rrowi
ng -
secu
red
–
20,70
2,565
,153
20,70
2,565
,153
– –
–
Accru
ed pr
ofit /
inter
est /
mark-
up
–
32
4,828
,575
324,8
28,57
5 –
– –
20
.2 –
46,49
4,542
,389
46,49
4,542
,389
– –
–
For the Half Year Ended 31 March 201825
JDW GROUP26
20.1
Fa
ir va
lue
mea
sure
men
t of fi
nanc
ial i
nstr
umen
ts
30 S
eptem
ber 2
017 -
(aud
ited)
Carry
ing A
moun
t Fa
ir Valu
e
Loan
s and
Ot
her fi
nanc
ial
receiv
ables
lia
bilitie
s To
tal
Leve
l 1
Leve
l 2
Leve
l 3
Note
(Rup
ees)
On
-Bala
nce s
heet
fina
ncial
inst
rum
ents
Fi
nanc
ial as
sets
not
mea
sure
d at
fair
valu
e
Cash
and b
ank b
alanc
es
13
3,757
,275
–
133,7
57,27
5 –
– –
Ad
vanc
es, d
epos
its an
d othe
r rec
eivab
les
75
6,805
,779
–
756,8
05,77
9 –
– –
Trad
e deb
ts - u
nsec
ured
cons
idere
d goo
d
3,23
4,430
,508
– 3,
234,4
30,50
8 –
– –
Lo
ng te
rm ad
vanc
es
3,
272,2
23
– 3,
272,2
23
– –
–
Long
term
depo
sits
54
,978,0
65
– 54
,978,0
65
– –
–
20.2
4,18
3,243
,850
–
4,18
3,243
,850
– –
–
Fi
nanc
ial lia
biliti
es n
ot m
easu
red
at fa
ir va
lue
Re
deem
able
capit
al - s
ecur
ed
–
83
,333,3
33
83,33
3,333
–
– –
Lo
ng te
rm fin
ance
s - se
cure
d
– 12
,924,3
12,94
7 12
,924,3
12,94
7 –
– –
Lia
bilitie
s aga
inst a
ssets
subje
ct
t
o fina
nce l
ease
- se
cure
d
– 30
6,472
,177
306,4
72,17
7 –
– –
Tr
ade a
nd ot
her p
ayab
les
–
1,
706,8
31,04
3 1,
706,8
31,04
3 –
– –
Sh
ort te
rm bo
rrowi
ng -
secu
red
–
10,05
3,163
,155
10,05
3,163
,155
– –
–
Accru
ed pr
ofit /
inter
est /
mark-
up
–
226,1
91,82
0 22
6,191
,820
– –
–
20
.2 –
25,30
0,304
,475
25,30
0,304
,475
– –
– 20
.2 Th
e Co
mpan
y ha
s no
t disc
losed
the
fair v
alues
of t
hese
fina
ncial
ass
ets a
nd lia
bilitie
s as
thes
e ar
e for
sho
rt ter
m or
repr
ice o
ver s
hort
term.
The
refor
e, the
ir ca
rrying
amo
unts
are
reas
onab
le ap
prox
imati
on of
their
fair v
alues
. 20
.3 Fa
ir va
lue m
easu
rem
ent o
f bio
logi
cal a
sset
s
In ab
senc
e of a
ctive
mar
ket fo
r sug
arca
ne an
d whe
at sta
nding
crop
s, the
fair v
alue m
easu
reme
nt for
the s
tandin
g cro
p has
been
categ
orize
d as L
evel
3 fair
value
base
d on t
he in
puts
to the
valua
tion t
echn
iques
used
. Fair
value
has b
een d
eterm
ined o
n the
basis
of a
disco
unted
cash
flow
mode
l. The
valua
tion m
odel
cons
iders
the pr
esen
t valu
e of n
et ca
sh flo
ws ex
pecte
d to
be ge
nera
ted by
the p
lantat
ion. T
he ca
sh flo
w pr
ojecti
ons i
nclud
e spe
cific e
stima
tes fo
r nex
t yea
r whic
h main
ly inc
lude c
rop’s
expe
cted y
ield.
The e
xpec
ted ca
sh flo
ws ar
e disc
ounte
d us
ing a
risk
adju
sted
disco
unt r
ate. T
he va
luatio
n tec
hniqu
e an
d sig
nifica
nt un
obse
rvable
inpu
ts inc
lude
value
d pla
ntatio
n, es
timate
d yie
ld pe
r acre
, esti
mated
futur
e su
garca
ne a
nd
risk-a
djuste
d disc
ount
rate.
20
.4 Fa
ir va
lue m
easu
rem
ent o
f inv
estm
ent p
rope
rty ca
rried
at co
st
Fair
value
of in
vestm
ent p
rope
rty w
as d
eterm
ined
base
d on
esti
mated
mar
ket v
alue.
Rate
per s
quar
e ac
re re
pres
ents
signifi
cant
unob
serva
ble in
put.
The
estim
ated
fair v
alue
would
inc
reas
e / (d
ecre
ase)
if, ex
pecte
d mar
ket r
ental
grow
th we
re hi
gher
/ (low
er),
the oc
cupa
ncy r
ate w
ere h
igher
/ (low
er) o
r ren
t-fre
e per
iods w
ere s
horte
r / (lo
nger
).
Notes to the Condensed Interim Unconsolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
For the Half Year Ended 31 March 201827
21 FINANCIAL RISK MANAGEMENT The Company’s financial risk management objective and policies are consistent with that
disclosed in the annual unconsolidated financial statements of the Company for the year ended 30 September 2017.
22 RECONCILIATION OF MOVEMENTS OF LIABILITIES TO CASH FLOWS ARISING FROM FINANCING ACTIVITIES
31 March 2018 Liabilities (long term and short term) Redeemable Long term Liabilities against assets Short term Accrued profit / capital - finances - subject to finance borrowings - interest secured secured lease - secured secured / markup Rupees
Balance as at 01 October 2017 83,333,333 12,924,312,947 306,472,177 10,053,163,155 226,191,820 Changes from financing cash flows Loans received during the period – 569,264,228 – 21,948,266,097 – Loan repaid during the period (55,555,556) (1,545,624,640) (89,312,604) (10,906,989,416) – (55,555,556) (976,360,412) (89,312,604) 11,041,276,681 – Other changes - Liability related Interest expense for the period – – – – 901,657,104 Interest paid during the period – – – – (803,020,349) Net change in cash and cash equivalent – – – (391,874,683) – Assets acquired on finance lease – – 63,956,000 – – Total liability-related other changes – – 63,956,000 (391,874,683) 98,636,755 Balance as at 31 March 2018 27,777,777 11,947,952,535 281,115,573 20,702,565,153 324,828,575 23 The Finance Act, 2017 introduced a tax at 7.5% under Section 5A of the Income Tax
Ordinance, 2001 on every public company other than a scheduled bank or modarba, that derives profits for tax year and does not distribute at least 40% of the after tax profit within six months of the end of said tax year through cash or bonus shares. However, subsequent to the period end, the Finance Act, 2018 has been promulgated and approved which has amended Section 5A and has reduced the limit of profit distribution in the form of cash dividend from 40% to 20% and the rate of tax from 7.5% to 5%.
The Board of Directors of the Company intends to distribute sufficient cash dividend
for the year ending 30 September 2018 to comply with the above stated requirements. Accordingly, no provision for tax on undistributed reserves has been made in this condensed interim unconsolidated financial information.
JDW GROUP28
24 DATE OF AUTHORIZATION This condensed interim unconsolidated financial information has been approved by the
Board of Directors of the Company and authorized for issue on 22 May 2018. 25 EVENTS AFTER THE BALANCE SHEET DATE Subsequent to the period end, the Finance Act, 2018 has been promulgated and
approved through which certain amendments were made in the income tax, sales tax, federal excise duty, custom act and other related laws. The amendments include super tax imposed through Finance Act, 2015 is extended upto tax year 2020 and corporate tax rate reduced to 29% for tax year 2019, thereafter, the rate will reduce by 1% annually until 2023.
Notes to the Condensed Interim Unconsolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
Chief Financial Officer Chief Executive Director
For the Half Year Ended 31 March 201829
CONDENSED INTERIM CONSOLIDATED
FINANCIAL INFORMATION (UN-AUDITED)
JDW GROUP30
22 May 2018 Chief Executive DirectorLahore
We, on behalf of the Board of Directors are pleased to present the Condensed Interim Consolidated Financial Information of JDW Sugar Mills Limited (the “Holding Company”) and its Subsidiary Companies Deharki Sugar Mills (Private) Limited, Faruki Pulp Mills Limited, Sadiqabad Power (Private) Limited and Ghotki Power (Private) Limited (“the Group”) for the half year ended March 31, 2018.
Deharki Sugar Mills (Private) Limited (“DSML”) was incorporated as a Private Limited Company. The Principal activity of Subsidiary Company is production and sale of crystalline sugar. The Holding Company Holds 100% shares of the Subsidiary Company.
Faruki Pulp Mills Limited (“FPML”) was incorporated as a Public Limited Company. The Company will be engaged in the manufacturing and sale of paper pulp. The Holding Company Holds 57.67% shares of the Subsidiary Company.
Sadiqabad Power (Private) Limited (“SPL”) was incorporated on 16 December 2016. The Company will be engaged in the generation of electricity under the expansion program of the Holding Company’s existing bagasse based co-generation power plants. The Holding Company holds 100% shares of the Subsidiary Company.
Ghotki Power (Private) Limited (“GPL”) was incorporated on 15 December 2016. The Company will be engaged in the generation of electricity under the expansion program of the Holding Company’s existing bagasse based co-generation power plants. The Holding Company holds 100% shares of the Subsidiary Company.
It is being confirmed that to the best of our knowledge, these condensed interim consolidated financial information for the half year ended March 31, 2018 give a true and fair view of the assets, liabilities, financial position and financial results of the Group and are in conformity with approved accounting standards as applicable in Pakistan.
FINANCIAL OVERVIEW
The consolidated financial results are as follows: 31-Mar-18 31-Mar-17 (Rs. in Million)
Gross Sales 21,028 23,815Net Sales 19,305 21,783Operating Profit 744 3,496(Loss) / Profit before Tax (314) 2,611(Loss) / Profit after Tax (322) 1,912
The Directors on behalf of the Board of Director have given their detailed review report of affairs of the Holding Company as well as Subsidiary Company in Directors’ review to the shareholders of Holding Company.
Directors’ ReviewON CONDENSED INTERIM CONSOLIDATED FINANCIAL INFORMATION
For the Half Year Ended 31 March 201831
JDW GROUP32
Condensed Interim Consolidated Statement of Financial Position (Un-audited) AS AT 31 MARCH 2018
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees
EQUITY AND LIABILITIESSHARE CAPITAL AND RESERVES Share capital 6 597,766,610 597,766,610 Share premium reserve 678,316,928 678,316,928 Accumulated profit 7,809,512,491 8,309,276,127 Equity attributable to owners of the Holding Company 9,085,596,029 9,585,359,665 Non-controlling interests 482,021,218 483,176,144 9,567,617,247 10,068,535,809 NON-CURRENT LIABILITIES Redeemable capital - secured 7 – –Long term finances - secured 8 10,991,256,143 10,162,313,674 Liabilities against assets subject to finance lease - secured 9 141,536,414 153,047,674 Deferred taxation 1,786,847,345 1,808,456,552 Retirement benefits 40,704,297 36,372,935 12,960,344,199 12,160,190,835 CURRENT LIABILITIES Short term borrowings - secured 10 25,269,538,599 13,783,388,645 Current portion of non-current liabilities 4,064,053,324 3,606,729,189 Trade and other payables 11 25,340,269,616 9,294,974,047 Unclaimed dividend 34,332,107 64,248,402 Accrued profit / interest / mark-up 377,258,206 277,241,631 55,085,451,852 27,026,581,914 77,613,413,298 49,255,308,558 CONTINGENCIES AND COMMITMENTS 12
ASSETS NON-CURRENT ASSETS Property, plant and equipment 13 26,886,388,705 26,248,589,291 Biological assets – 14,595,399 Investment property 218,599,597 218,599,597 Intangibles 1,074,982,089 1,076,016,261 Long term investments 14 – – Long term advances – 3,272,223 Long term deposits 31,420,989 55,042,065 28,211,391,380 27,616,114,836 CURRENT ASSETS Biological assets 549,856,217 2,282,737,798 Stores, spare parts and loose tools 2,180,658,744 1,712,412,677 Stock-in-trade 37,645,221,471 11,331,790,869 Trade debts - unsecured considered good 3,815,668,773 3,588,040,356 Advances, deposits, prepayments and other receivables 15 3,606,140,587 1,734,614,036 Advance tax - net 990,721,187 818,893,090 Cash and bank balances 16 613,754,939 170,704,896 49,402,021,918 21,639,193,722 77,613,413,298 49,255,308,558The annexed notes from 1 to 26 form an integral part of this condensed interim consolidated financial information.
Chief Financial Officer Chief Executive Director
For the Half Year Ended 31 March 201833
Condensed Interim Consolidated Profit and Loss Account (Un-audited) FOR THE HALF YEAR AND QUARTER ENDED 31 MARCH 2018
Chief Financial Officer Chief Executive Director
Six months ended Three months ended Note 31-Mar-18 31-Mar-17 31-Mar-18 31-Mar-17 Rupees Rupees Rupees Rupees
Gross sales 21,028,344,795 23,814,664,872 8,660,052,960 10,841,230,931 Sales tax and others (1,723,426,667) (2,031,981,523) (371,787,199) (849,193,429)Net sales 17 19,304,918,128 21,782,683,349 8,288,265,761 9,992,037,502 Cost of sales (19,359,329,026) (17,506,669,606) (8,008,704,276) (7,373,800,776)Gross (loss) / profit (54,410,898) 4,276,013,743 279,561,485 2,618,236,726 Administrative expenses (667,796,105) (782,969,855) (362,209,085) (507,861,130)Selling expenses (150,443,742) (45,320,249) (136,171,696) (34,049,406)Other income 18 1,634,805,287 217,503,678 1,286,472,357 147,197,916 Other expenses (18,213,958) (168,920,160) (17,393,133) (104,271,902) 798,351,482 (779,706,586) 770,698,443 (498,984,522)Profit from operations 743,940,584 3,496,307,157 1,050,259,928 2,119,252,204 Finance cost (1,058,052,610) (885,784,981) (577,182,176) (522,599,733)(Loss) / profit before taxation (314,112,026) 2,610,522,176 473,077,752 1,596,652,471 Taxation (7,476,553) (698,251,825) (324,267,973) (424,611,881)(Loss) / profit after taxation (321,588,579) 1,912,270,351 148,809,779 1,172,040,590
Attributable to: Owners of the Holding Company (320,433,653) 1,913,946,207 149,584,668 1,172,949,554 Non-controlling interests (1,154,926) (1,675,856) (774,889) (908,964) (321,588,579) 1,912,270,351 148,809,779 1,172,040,590 The annexed notes from 1 to 26 form an integral part of this condensed interim consolidated financial information.
JDW GROUP34
Chief Financial Officer Chief Executive Director
Condensed Interim Consolidated Statement of Comprehensive Income (Un-audited) FOR THE HALF YEAR AND QUARTER ENDED 31 MARCH 2018
Six months ended Three months ended 31-Mar-18 31-Mar-17 31-Mar-18 31-Mar-17 Rupees Rupees Rupees Rupees
(Loss) / profit after taxation for the period (321,588,579) 1,912,270,351 148,809,779 1,172,040,590 Other comprehensive income – – – – Total comprehensive (loss) / income for the period (321,588,579) 1,912,270,351 148,809,779 1,172,040,590 Attributable to: Owners of the Holding Company (320,433,653) 1,913,946,207 149,584,668 1,172,949,554 Non-controlling interests (1,154,926) (1,675,856) (774,889) (908,964) (321,588,579) 1,912,270,351 148,809,779 1,172,040,590 The annexed notes from 1 to 26 form an integral part of this condensed interim consolidated financial information.
For the Half Year Ended 31 March 201835
Condensed Interim Consolidated Cash flow Statement (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
Chief Financial Officer Chief Executive Director
31-Mar-18 31-Mar-17 Rupees RupeesCASH FLOWS FROM OPERATING ACTIVITIES (Loss) / profit before taxation (314,112,026) 2,610,522,176 Adjustments for non cash and other items Finance cost 1,058,052,610 887,597,541 Depreciation 793,718,939 890,654,504 Amortisation 1,034,170 1,041,217 Staff retirement benefits 62,473,592 47,268,275 Workers’ profit participation fund 17,393,133 139,175,992 Assets written off 130,447 – Profit on disposal of operating fixed assets (61,376,866) (6,972,058) Fair value gain on biological assets (21,669,571) (35,747,665) Workers’ welfare fund – 29,744,168 Provision for doubtful debts – 24,716,942 Gain on disposal of investment property – (21,280,885) 1,849,756,454 1,956,198,031 Operating profit before working capital changes 1,535,644,428 4,566,720,207 (Increase) / decrease in current assets Biological assets 1,769,146,551 1,637,317,271 Stores, spare parts and loose tools (468,246,067) 38,338,231 Stock-in-trade (26,313,430,602) (28,480,286,793) Trade debts - unsecured considered good (509,537,110) (1,012,975,398) Advances, deposits, prepayments and other receivables (1,830,788,717) (1,558,540,395) (27,352,855,945) (29,376,147,084)Increase in current liabilities Trade and other payables 16,336,959,468 11,977,433,031 Cash used in operations (9,480,252,049) (12,831,993,846) Taxes paid (198,756,328) (292,539,012) Workers’ profit participation fund paid (69,801,450) (124,461,119) Staff retirement benefits paid (61,055,734) (154,242,075) (329,613,512) (571,242,206)Net cash used in operating activities (9,809,865,561) (13,403,236,052)CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditure (1,522,890,970) (868,977,763) Long term advances 12,027,777 14,027,777 Long term deposits - net 23,621,076 58,443,325 Proceeds from sale of operating fixed assets 161,179,849 20,321,381 Proceeds from sale of investment property – 37,437,422Net cash used in investing activities (1,326,062,268) (738,747,858) CASH FLOWS FROM FINANCING ACTIVITIES Long term finances - net 1,300,111,948 (962,902,276) Short term borrowings - net 12,257,718,556 19,096,178,914 Finance cost paid (898,723,606) (591,348,454) Lease rentals paid (99,314,146) (565,575,997) Dividend paid (209,246,278) (888,737,458)Net cash generated from financing activities 12,350,546,474 16,087,614,729 Net increase in cash and cash equivalents 1,214,618,645 1,945,630,819 Cash and cash equivalents at beginning of the period (3,232,625,687) (2,329,460,675)Cash and cash equivalents at end of the period (2,018,007,042) (383,829,856)
Cash and cash equivalents comprise of the following: - Cash and bank balances 613,754,939 732,931,201 - Running finances and morabaha finances (2,631,761,981) (1,116,761,057) (2,018,007,042) (383,829,856)The annexed notes from 1 to 26 form an integral part of this condensed interim consolidated financial information.
JDW GROUP36
Condensed Interim Consolidated Statement of Changes in Equity (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
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For the Half Year Ended 31 March 201837
Notes to the Condensed Interim Consolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
1 STATUS AND NATURE OF BUSINESS
The Group comprises of:
– JDW Sugar Mills Limited (“the Holding Company”); and – Deharki Sugar Mills (Private) Limited - “DSML” (“the Subsidiary Company”); – Faruki Pulp Mills Limited - “FPML” (“the Subsidiary Company”); – Sadiqabad Power (Private) Limited - “SPL” (“the Subsidiary Company”); and – Ghotki Power (Private) Limited - “GPL” (“the Subsidiary Company”). 1.1 JDW Sugar Mills Limited (“the Holding Company”) was incorporated in Pakistan on
31 May 1990 as a private limited company and was subsequently converted into a public limited company on 24 August 1991. Shares of the Holding Company are listed on the Pakistan Stock Exchange Limited. The registered office of the Holding Company is situated at 17 - Abid Majeed Road, Lahore Cantonment, Lahore. The principal activity of the Holding Company is production and sale of crystalline sugar, electricity and managing corporate farms.
1.2 Deharki Sugar Mills (Private) Limited (“the Subsidiary Company”) was incorporated
in Pakistan on 14 July 2010 as a Private Limited Company. The registered office of the Subsidiary Company is situated at 17 - Abid Majeed Road, Lahore Cantonment, Lahore. The principal activity of the Subsidiary Company is manufacturing and sale of crystalline sugar. The Holding Company holds 100% shares of the Subsidiary Company.
1.3 Faruki Pulp Mills Limited (“the Subsidiary Company”) was incorporated in Pakistan
on 20 October 1991 as a Public Limited Company. FPML will be engaged in the manufacturing and sale of paper pulp. The production facility is situated 20 km from Gujrat and the registered office is situated at 13-B, Block -K, Main Boulevard Gulberg II Lahore. The Holding Company holds 57.67% shares of the Subsidiary Company.
1.4 Sadiqabad Power (Private) Limited (“the Subsidiary Company”) was incorporated
in Pakistan on 16 December 2016. The Subsidiary Company will be engaged in the generation of electricity under the expansion program of the Holding Company’s existing bagasse based cogeneration power plants. The registered office of the Subsidiary Company is situated at 17-Abid Majeed Road, Lahore Cantonment, Lahore. The Holding Company holds 100% shares of the Subsidiary Company.
1.5 Ghotki Power (Private) Limited (“the Subsidiary Company”) was incorporated in
Pakistan on 15 December 2016. The Subsidiary Company will be engaged in the generation of electricity under the expansion program of the Holding Company’s existing bagasse based cogeneration power plants. The registered office of the Subsidiary Company is situated at 17-Abid Majeed Road, Lahore Cantonment, Lahore. The Holding Company holds 100% shares of the Subsidiary Company.
JDW GROUP38
2 BASIS OF PREPARATION2.1 Basis of accounting2.1.1 This condensed interim consolidated financial information comprises the
condensed interim consolidated statement of financial position of the Group as at 31 March 2018 and the related condensed interim consolidated profit and loss account, condensed interim consolidated statement of comprehensive income, condensed interim consolidated cash flow statement and condensed interim consolidated statement of changes in equity together with the notes forming part thereof for the period from 01 October 2017 to 31 March 2018.
2.1.2 These condensed interim consolidated financial information have been prepared
in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting comprise of:
– International Accounting Standard (IAS) 34, ‘‘Interim Financial Reporting,’’
issued by the International Accounting Standards Board (IASB) as notified under the Companies Act, 2017;
– Islamic Financial Accounting Standards (IFAS) issued by the Institute of Chartered Accountants of Pakistan as notified under the Companies Act, 2017; and
– Provisions of and directives issued under the Companies Act, 2017. Where the provisions of and directives issued under the Companies Act, 2017
differ with the requirements of IAS 34 or IFAS, the provisions of and directives issued under the Companies Act, 2017 have been followed.
2.1.3 This condensed interim consolidated financial information does not include all of the information required for full annual financial statements and should be read in conjunction with the annual financial statements for the year ended 30 September 2017.
2.1.4 Comparative consolidated statement of financial position numbers are extracted
from the annual audited consolidated financial statements of the Group for the year ended 30 September 2017, whereas comparative figures of profit and loss account, statement of comprehensive income, cash flow statement and statement of changes in equity are stated from unaudited condensed interim financial information of the Group for the six months period ended 31 March 2017.
2.1.5 This condensed interim consolidated financial information is unaudited and being
submitted to the shareholders as required under Section 237 of the Companies Act, 2017 and the Listing Regulations of Pakistan Stock Exchange Limited.
3 USE OF ESTIMATES AND JUDGMENTS The preparation of the condensed interim consolidated financial information requires
management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.
In preparing the condensed interim consolidated financial information, the significant
judgments made by the management in applying accounting policies and the key sources of estimation uncertainty are the same as those applied in the preparation of audited consolidated financial statements for the year ended 30 September 2017.
Notes to the Condensed Interim Consolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
For the Half Year Ended 31 March 201839
4 STATEMENT OF CONSISTENCY IN ACCOUNTING POLICIES4.1 The accounting policies and the methods of computation adopted in the preparation
of this condensed interim consolidated financial information are same as those applied in the preparation of the audited consolidated financial statements for the year ended 30 September 2017.
4.2 Effective 01 January 2018, the provisions of the Companies Act, 2017 relating
to the preparation of the financial statements have become applicable. However, there is no major impact of these provisions on the Group condensed interim consolidated financial information.
4.3 The following amendments and interpretations of approved accounting standards
will be effective for accounting periods as detailed below:
Effective date (accounting periods Standard or interpretation beginning on or after)
IFRS 2 – Share-based Payments 01 January 2018 IAS 40 – Investment Property 01 January 2018 IAS 28 – Investments in Associates and Joint Ventures 01 January 2018 IFRIC 22 – Foreign Currency Transactions and Advance Consideration 01 January 2018 IFRS 9 – Financial Instruments 01 July 2018 IFRS 15 – Revenue from Contract with customer 01 July 2018 IFRS 3 – Business Combinations 01 January 2019 IFRS 11 – Joint ventures 01 January 2019 IAS 12 – Income Taxes 01 January 2019 IAS 23 – Borrowing cost 01 January 2019 IAS 28 – Investments in Associates and Joint Ventures 01 January 2019 IFRIC 23 – Uncertainty over Income Tax Treatments 01 January 2019
5 SEASONALITY OF OPERATIONS Due to seasonal nature of sugar segment, operating results of sugar and co-generation
power are expected to fluctuate in the second half of the year. The sugarcane crushing season normally starts from November and lasts till April each
year.
JDW GROUP40
(Un-audited) (Audited) 31-Mar-18 30-Sep-17 Rupees Rupees
6 SHARE CAPITAL
6.1 Authorized capital 75,000,000 (30 September 2017: 75,000,000) ordinary shares of Rs. 10 each 750,000,000 750,000,000 25,000,000 (30 September 2017: 25,000,000) preference shares of Rs. 10 each 250,000,000 250,000,000 1,000,000,000 250,000,000 6.2 Issued, subscribed and paid-up capital 32,145,725 (30 September 2017: 32,145,725) ordinary shares of Rs. 10 each fully paid in cash 321,457,250 321,457,250 27,630,936 (30 September 2017: 27,630,936) voting bonus shares of Rs. 10 each fully paid in cash 276,309,360 276,309,360 597,766,610 597,766,610
7 REDEEMABLE CAPITAL - SECURED
During the period, the Holding Company has repaid Rs. 55.55 million (year ended 30 September 2017: Rs. 111.11 million ) to TFC holders. Amounts due in next twelve months amounting to Rs. 27.77 million (year ended 30 September 2017: Rs. 83.33 million) are included in current portion presented under current liabilities. These carry mark-up at three months KIBOR plus 100 bps per annum.
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees
8 LONG TERM FINANCES - SECURED
Markup bearing finances from conventional banks 8.1 6,843,897,156 7,991,383,792Islamic mode of financing 8.2 4,147,358,987 2,170,929,882 8.3 10,991,256,143 10,162,313,674 8.1 Markup bearing finances from conventional banks: Balance at beginning of the period / year 11,036,355,145 12,193,498,661 Finances received during the period / year 8.1.1 534,033,839 1,965,966,161 Repayments during the period / year (1,567,096,720) (3,123,109,677) 10,003,292,264 11,036,355,145 Current portion presented under current liabilities (3,159,395,108) (3,044,971,353) 6,843,897,156 7,991,383,792
Notes to the Condensed Interim Consolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
For the Half Year Ended 31 March 201841
Markup Duration
Grace Amount basis period (Rupees)
8.1.1 Finances received during the period Askari Bank Limited 3mk + 1.00 05 Years 01 Year 500,000,000 National Bank of Pakistan Limited (II) 3mk + 0.50 05 Years 01 Year 34,033,839 534,033,839
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees
8.2 Islamic mode of financing: Balance at beginning of the period / year 2,495,929,882 1,264,000,000 Finances received during the period / year 8.2.1 2,535,230,389 1,463,179,882 Repayments during the period / year (146,500,000) (231,250,000) 4,884,660,271 2,495,929,882 Current portion presented under current liabilities (737,301,284) (325,000,000) 4,147,358,987 2,170,929,882
Profit / Interest Duration
Grace Amount basis period (Rupees)
8.2.1 Finances received during the period Bank Alfalah Limited 3mk + 0.90 05 Years 01 Year 35,230,389 Al Baraka Bank (Pakistan) Limited 3mk + 0.85 05 Years 01 Year 1,000,000,000 MCB Islamic Bank Limited 3mk + 0.80 05 Years 01 Year 1,000,000,000 Faysal Bank Limited 3mk + 1.00 05 Years 01 Year 500,000,000 2,535,230,389 * 3 mk i.e. 3 months KIBOR 8.3 The securities offered and facility limits of these long term finances are the same
as disclosed in the audited consolidated financial statements of the Group for the year ended 30 September 2017, except as disclosed in note 8.1.1 and 8.2.1. The interest / markup is payable quarterly / semi annually at a rate of three to six months KIBOR plus 50 bps to 100 bps per annum.
9 LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE - SECURED During the period, the Holding Company availed leases aggregating Rs. 63.96 million
(year ended 30 September 2017: Rs. 76.50 million) and repaid principal amount of Rs. 89.31 million (year ended 30 September 2017: Rs. 618.84 million). Amounts due in next twelve months amounting to Rs. 139.58 million (year ended 30 September 2017: Rs. 153.42 million) are included in current portion presented under current liabilities. Lease rentals are payable on quarterly / monthly basis and include finance cost ranging from three months to one year KIBOR plus 100 bps per annum (year ended 30 September 2017: three months to one year KIBOR plus 100 to 300 bps per annum) which has been used as the discounting factor. The Holding Company has the option to purchase the assets upon completion of lease period and has the intention to exercise such option.
JDW GROUP42
(Un-audited) (Audited) 31-Mar-18 30-Sep-17 Rupees Rupees10 SHORT TERM BORROWINGS - SECURED
10.1 Type of short term borrowings 10.1.1 Markup based borrowings from conventional banks Cash finances 14,136,538,558 9,128,652,000 Running finances 1,881,761,981 1,603,330,583 Inland bill discounting 899,999,998 884,999,998 Finance against trust receipts 420,233,098 366,406,064 17,338,533,635 11,983,388,645
10.1.2 Islamic mode of financing Salam/Istisna finances 7,181,004,964 – Morabaha finances 750,000,000 1,800,000,000 7,931,004,964 1,800,000,000 25,269,538,599 13,783,388,645 10.2 The Group has obtained these facilities from various banks and financial
institutions. The markup rate applicable during the year ranges from one to six months KIBOR plus 0 (zero) to 135 bps per annum (year ended 30 September 2017: one to six months KIBOR plus 20 to 135 bps per annum).
10.3 The securities offered of these short term borrowings are the same as disclosed in
the audited consolidated financial statements of the Group for the year ended 30 September 2017 whereas the facility limits have increased to Rs. 33,805 million (year ended 30 September 2017: Rs. 31,665 million).
11 TRADE AND OTHER PAYABLES This includes advances from customers aggregating Rs. 9,595.44 million (year ended 30
September 2017: Rs. 7,202.67 million).
12 CONTINGENCIES AND COMMITMENTS 12.1 There is no material change in contingencies from the preceding audited
consolidated financial statements of the Group for the year ended 30 September 2017.
(Un-audited) (Audited) 31-Mar-18 30-Sep-17 Rupees Rupees
Letters of guarantee in favour of various parties Holding Company - JDWSML 443,187,500 83,000,000 Subsidiary Company - DSML 49,756,000 7,500,000 12.2 Commitments Letters of credit for import of machinery and its related components Holding Company - JDWSML 233,391,193 569,509,835 Subsidiary Company - DSML – 17,449,232
Notes to the Condensed Interim Consolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
For the Half Year Ended 31 March 201843
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees13 PROPERTY PLANT AND EQUIPMENT
Operating fixed assets 13.1 25,492,196,510 23,219,852,562Capital work in progress 13.2 1,280,751,230 2,938,735,267Stores, spare parts and loose tools held for capital expenditure 113,440,965 90,001,462 26,886,388,705 26,248,589,291 13.1 Operating fixed assets Net book value as at beginning of the period / year 23,219,852,562 22,151,628,694 Additions during the period / year 3,191,317,876 2,641,048,289 Disposals during the period / year - net book value (117,594,791) (89,841,962) Depreciation charged during the period / year (801,379,137) (1,482,982,459) 25,492,196,510 23,219,852,562 13.2 Capital work in progress Opening balance 2,938,735,267 1,968,331,366 Addition during the period / year 1,016,057,345 2,324,872,570 Transfers made during the period / year (2,674,041,382) (1,354,468,669) Closing balance 1,280,751,230 2,938,735,267
14 LONG TERM INVESTMENTS This represents investment of the Holding Company of 47.37% in the equity of JDW Power
(Private) Limited “JDWPL”, an unquoted associated company. The cost of investment is Rs. 90 million represented by 9 million shares of Rs. 10 each. The carrying value of the investment is Rs. nil (year ended 30 September 2017: Rs. nil) due to accumulated impairment allowance of Rs. 90 million charged in year ended 30 September 2012.
15 ADVANCES, DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES This includes an amount of Rs. 5.44 million (year ended 30 September 2017: Rs. 6.32
million) receivable from executives of the Holding Company.
JDW GROUP44
(Un-audited) (Audited) Note 31-Mar-18 30-Sep-17 Rupees Rupees16 CASH AND BANK BALANCES
Current accounts Deposit with conventional banks 461,878,778 146,274,759 Deposit with islamic banks 40,361,323 16,576,446 502,240,101 162,851,205 Saving accounts Deposit with conventional banks 16.1 7,585,977 3,740,446 509,826,078 166,591,651 Cash in hand 103,928,861 4,113,245 613,754,939 170,704,896 16.1 The balances in saving accounts carry markup at 3.75% to 4.00% per annum (year
ended 30 September 2017: 3.75% per annum).
Six months ended Three months ended 31-Mar-18 31-Mar-17 31-Mar-18 31-Mar-17 Rupees Rupees Rupees Rupees
17 NET SALES
Sugar 17,032,026,599 19,855,035,382 6,205,375,520 8,361,555,246 Electricity 2,265,731,275 2,008,739,315 1,171,298,039 1,147,504,060 Molasses - by product 1,341,371,438 1,915,067,099 968,331,281 1,296,689,049 Bagasse - by product 162,733,931 7,553,150 89,763,708 7,553,150 Agri inputs 222,549,839 – 221,372,699 – Agriculture produce 3,931,713 28,269,926 3,911,713 27,929,426 21,028,344,795 23,814,664,872 8,660,052,960 10,841,230,931 Less: sales tax and others (1,723,426,667) (2,031,981,523) (371,787,199) (849,193,429) 19,304,918,128 21,782,683,349 8,288,265,761 9,992,037,502 Sales include sugar export sales of Rs. 4,753 million (31 March 2017: Rs. 1,659 million). 18 OTHER INCOME This mainly includes subsidy aggregating Rs. 1,379 million (31 March 2017 : Rs. nil) from
Federal and Provincial Government on export of sugar, scrap sale of Rs. 28.53 million (31 March 2017: Rs. 74.47 million), sale of mud of Rs. 110.99 million (31 March 2017: Rs. 69.68 million), fair value gain on biological assets of Rs. 21.67 million (31 March 2017: Rs. 35.75 million) and gain on sale of operating fixed assets of Rs. 62.20 million (31 March 2017: Rs. 6.97 million).
Notes to the Condensed Interim Consolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
For the Half Year Ended 31 March 201845
19 B
USI
NES
S SE
GM
ENTS
INFO
RM
ATIO
N
19.1
The G
roup
’s re
porta
ble se
gmen
ts ar
e as f
ollow
s:
Re
porta
ble S
egme
nt
Oper
ation
s
Su
gar
Prod
uctio
n and
sale
of cry
stallin
e sug
ar an
d othe
r rela
ted jo
int an
d by-p
roduc
ts.
Co-G
enera
tion
Gene
ration
and s
ale of
elec
tricity
to C
PPA-
G.
Corpo
rate f
arms
Mana
ging c
orpora
te far
ms fo
r cult
ivatio
n of s
ugarc
ane a
nd th
e sma
ll qua
ntity
of co
tton,
mong
and w
heat.
Othe
r seg
ment
Proje
cts un
der c
onstr
uctio
n for
manu
factur
e / ge
nerat
ion an
d sale
of w
ood p
ulp an
d elec
tricity
.
19.2
Infor
matio
n reg
ardin
g the
Gro
up’s
repo
rtable
segm
ents
is pr
esen
ted be
low:
Suga
r Co
-Gen
erati
on
Corp
orate
Farm
s O
ther
Seg
ment
Int
er S
egme
nt R
econ
ciliat
ion
Total
31-M
ar-18
31
-Mar
-17
31-M
ar-18
31
-Mar
-17
31-M
ar-18
31
-Mar
-17
31-M
ar-18
31
-Mar
-17
31-M
ar-18
31
-Mar
-17
31-M
ar-18
31
-Mar
-17
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
Ru
pees
19.2.
1 Se
gmen
t rev
enue
s & re
sults
Ne
t exte
rnal re
venu
es
17,23
3,910
,046
20,04
0,498
,510
2,06
7,076
,369
1,71
3,914
,912
3,93
1,713
28
,269,9
26
– –
– –
19,30
4,918
,128
21,78
2,683
,349
Int
er-se
gmen
t reve
nues
1,
309,3
73,07
9 1,
270,6
22,55
3 1,
068,5
44,50
2 1,
375,3
82,90
7 3,
001,0
99,60
9 3,
478,4
07,56
1 –
– (5
,379,0
17,19
0) (6
,124,4
13,02
1) –
–
Repo
rtable
segm
ent re
venu
e 18
,543,2
83,12
5 21
,311,1
21,06
3 3,
135,6
20,87
1 3,
089,2
97,81
9 3,
005,0
31,32
2 3,
506,6
77,48
7 –
– (5
,379,0
17,19
0) (6
,124,4
13,02
1) 19
,304,9
18,12
8 21
,782,6
83,34
9
Segm
ent (l
oss)
/ profi
t befo
re tax
(1
,058,4
69,86
7) 1,
138,7
34,82
3 1,
231,4
95,83
5 1,
323,4
18,77
0 (4
78,51
9,426
) 15
2,446
,092
(8,61
8,568
) (4
,077,5
09)
– –
(3
14,11
2,026
) 2,
610,5
22,17
6
19.2.
2 Int
er-se
gmen
t sale
s and
purc
hase
s
Inter-
segm
ent s
ales a
nd pu
rchas
es ha
ve be
en el
imina
ted fro
m tot
al fig
ures.
19.2.
3 Ba
sis of
inter
-segm
ent p
ricing
All
inter
-segm
ent tr
ansfe
rs are
mad
e at fa
ir valu
e. 19
.2.4
Segm
ent a
ssets
& lia
bilitie
s
Su
gar
Co-G
ener
ation
Co
rpor
ate Fa
rms
Oth
er S
egme
nt
Inter
Seg
ment
Rec
oncil
iation
To
tal
(Un-
audit
ed)
(Aud
ited)
(U
n-au
dited
) (A
udite
d)
(Un-
audit
ed)
(Aud
ited)
(U
n-au
dited
) (A
udite
d)
(Un-
audit
ed)
(Aud
ited)
(U
n-au
dited
) (A
udite
d)
31
-Mar
-18
30-S
ep-17
31
-Mar
-18
30-S
ep-17
31
-Mar
-18
30-S
ep-17
31
-Mar
-18
30-S
ep-17
31
-Mar
-18
30-S
ep-17
31
-Mar
-18
30-S
ep-17
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
Rupe
es
To
tal as
sets
for re
porta
ble se
gmen
t 66
,181,7
49,88
9 37
,990,6
55,77
8 8,
606,9
13,37
6 8,
483,8
36,89
8 6,
030,1
07,44
4 7,
927,9
04,66
4 2,
173,6
59,77
9 2,
171,0
65,71
0 (5
,379,0
17,19
0) (7
,318,1
54,49
1) 77
,613,4
13,29
8 49
,255,3
08,55
9
Total
liabil
ities f
or rep
ortab
le se
gmen
t 68
,769,9
95,25
9 40
,002,6
71,39
5 4,
342,4
51,02
7 5,
733,7
69,71
9 26
7,233
,569
722,8
50,00
6 45
,133,3
86
45,63
6,120
(5,
379,0
17,19
0) (7
,318,1
54,49
1) 68
,045,7
96,05
1 39
,186,7
72,74
9
31-M
ar-18
31
-Mar
-17
Ru
pees
Ru
pees
19.3
Reco
ncilia
tion o
f rep
ortab
le se
gmen
t pro
fit an
d los
s
Total
(loss
) / pro
fit be
fore t
ax fo
r repo
rtable
segm
ents
(314
,112,0
26)
2,61
0,522
,176
Un
alloc
ated c
orpora
te ex
pens
es
(7,47
6,553
) (6
98,25
1,825
)
(Loss
) / pro
fit aft
er tax
ation
(3
21,58
8,579
) 1,
912,2
70,35
1
JDW GROUP46
20 F
AIR
VA
LUE
MEA
SUR
EMEN
T O
F FI
NA
NC
IAL
INST
RU
MEN
TSTh
e fo
llow
ing
tabl
e sh
ows
the
carry
ing
amou
nts
and
fair
valu
es o
f fina
ncia
l ass
ets
and
finan
cial
liab
ilitie
s in
clud
ing
thei
r lev
els
in th
e fa
ir va
lue
hier
arch
y fo
r fin
anci
al in
stru
men
ts m
easu
red
at fa
ir va
lue.
It d
oes
not i
nclu
de fa
ir va
lue
info
rmat
ion
for fi
nanc
ial a
sset
s an
d fin
anci
al li
abilit
ies
not m
easu
red
at fa
ir va
lue
if th
e ca
rryin
g am
ount
is a
reas
onab
le a
ppro
xim
atio
n of
fair
valu
e:
31 M
arch
2018
(un-
audit
ed)
Ca
rrying
Amo
unt
Fair V
alue
Lo
ans a
nd
Othe
r fina
ncial
rec
eivab
les
liabil
ities
Total
Le
vel 1
Le
vel 2
Le
vel 3
No
te (R
upee
s)
On-B
alanc
e she
et fi
nanc
ial in
stru
men
ts
Fi
nanc
ial as
sets
not
mea
sure
d at
fair
valu
e
Cash
and b
ank b
alanc
es
61
3,754
,939
– 61
3,754
,939
– –
–
Adva
nces
, dep
osits
and o
ther r
eceiv
ables
320,1
29,15
7 –
32
0,129
,157
– –
–
Trad
e deb
ts - u
nsec
ured
cons
idere
d goo
d
3,81
5,668
,773
–
3,81
5,668
,773
– –
–
Long
term
adva
nces
– –
– –
– –
Lo
ng te
rm de
posit
s
31,42
0,989
–
31
,420,9
89
– –
–
20.2
4,78
0,973
,858
–
4,78
0,973
,858
– –
–
Fina
ncial
liabi
lities
not
mea
sure
d at
fair
valu
e
Rede
emab
le ca
pital
- sec
ured
–
27,77
7,773
27
,777,7
73
– –
–
Lo
ng te
rm fin
ance
s - se
cure
d
–
14,88
7,952
,535
14,88
7,952
,535
– –
–
Lia
bilitie
s aga
inst a
ssets
subje
ct
to fi
nanc
e lea
se -
secu
red
–
281,1
15,57
3 28
1,115
,573
– –
–
Trad
e and
othe
r pay
ables
–
15,55
5,153
,323
15,55
5,153
,323
– –
–
Shor
t term
borro
wing
s - se
cure
d
– 25
,269,5
38,59
9 25
,269,5
38,59
9 –
– –
Ac
crued
profi
t / int
eres
t / ma
rkup
–
37
7,258
,206
377,2
58,20
6 –
– –
20
.2 –
56,39
8,796
,009
56,39
8,796
,009
– –
–
Notes to the Condensed Interim Consolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
For the Half Year Ended 31 March 201847
20.1
Fa
ir va
lue
mea
sure
men
t of fi
nanc
ial i
nstr
umen
ts
30 S
eptem
ber 2
017 -
(aud
ited)
Carry
ing A
moun
t Fa
ir Valu
e
Loan
s and
Ot
her fi
nanc
ial
receiv
ables
lia
bilitie
s To
tal
Leve
l 1
Leve
l 2
Leve
l 3
Note
(Rup
ees)
On
-Bala
nce s
heet
fina
ncial
inst
rum
ents
Fi
nanc
ial as
sets
not
mea
sure
d at
fair
valu
e
Cash
and b
ank b
alanc
es
17
0,704
,896
– 17
0,704
,896
– –
–
Adva
nces
, dep
osits
and o
ther r
eceiv
ables
64,72
9,775
–
64,72
9,775
–
– –
Trad
e deb
ts - u
nsec
ured
cons
idere
d goo
d
3,58
8,040
,356
–
3,58
8,040
,356
– –
–
Long
term
adva
nces
3,27
2,223
–
3,27
2,223
–
– –
Lo
ng te
rm de
posit
s
55,04
2,065
–
55,04
2,065
–
– –
20
.2 3,
881,7
89,31
5 –
3,
881,7
89,31
5 –
– –
Fina
ncial
liabi
lities
not
mea
sure
d at
fair
valu
e
Rede
emab
le ca
pital
- sec
ured
–
83,33
3,333
83
,333,3
33
– –
–
Long
term
finan
ces -
secu
red
–
13,53
2,285
,027
13,53
2,285
,027
– –
–
Liabil
ities a
gains
t ass
ets su
bject
to fi
nanc
e lea
se -
secu
red
–
306
,472,1
77
306,4
72,17
7 –
– –
Tr
ade a
nd ot
her p
ayab
les
–
1,
903,5
86,82
6 1,
903,5
86,82
6 –
– –
Sh
ort te
rm bo
rrowi
ng -
secu
red
–
13,78
3,388
,645
13,78
3,388
,645
– –
–
Accru
ed pr
ofit /
inter
est /
mark-
up
–
277
,241,6
31
277,2
41,63
1 –
– –
20.2
– 2
9,886
,307,6
39
29,88
6,307
,639
– –
– 20
.2 Th
e Gro
up ha
s not
disclo
sed t
he fa
ir valu
es of
thes
e fina
ncial
asse
ts an
d liab
ilities
as th
ese a
re fo
r sho
rt ter
m or
repr
ice ov
er sh
ort te
rm. T
here
fore,
their c
arryi
ng am
ounts
are r
easo
nable
ap
prox
imati
on of
their
fair v
alues
. 20
.3 Fa
ir va
lue m
easu
rem
ent o
f bio
logi
cal a
sset
s
In ab
senc
e of
activ
e ma
rket f
or s
ugar
cane
stan
ding
crops
, the
fair
value
mea
sure
ment
for th
e sta
nding
cro
p ha
s be
en c
atego
rized
as
Leve
l 3 fa
ir va
lue b
ased
on
the in
puts
to the
va
luatio
n tec
hniqu
es us
ed. F
air va
lue ha
s bee
n dete
rmine
d on t
he ba
sis of
a dis
coun
ted ca
sh flo
w mo
del. T
he va
luatio
n mod
el co
nside
rs the
pres
ent v
alue o
f net
cash
flows
expe
cted
to be
gene
rated
by th
e plan
tation
. The
cash
flow
proje
ction
s inc
lude s
pecifi
c esti
mates
for n
ext y
ear w
hich m
ainly
includ
e cro
p’s ex
pecte
d yiel
d. Th
e exp
ected
cash
flows
are d
iscou
nted
using
a ris
k adju
sted d
iscou
nt ra
te.
20.4
Fair
valu
e mea
sure
men
t of i
nves
tmen
t pro
perty
carri
ed at
cost
Fa
ir va
lue o
f inv
estm
ent p
rope
rty is
dete
rmine
d ba
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JDW GROUP48
21 TRANSACTIONS WITH RELATED PARTIES The related parties comprise of associated company, other related companies, directors
of the Group and entities under common directorship, key management personnel and post employment benefit plans. Amounts due from and due to related parties are shown under respective notes to these consolidated financial statements. Other significant transactions with related parties except those disclosed elsewhere are as follows:
31-Mar-18 31-Mar-17 Rupees Rupees Name of Company Relationship Transactions
JDW Aviation Associated Company Reimbursement of (Pvt) Limited expenses 6,772,024 10,413,370 Key Management Consultancy services 5,824,128 7,129,691 Personnel Directors’ remuneration and allowances 145,796,668 168,213,335 Post Employment Contribution Plan Provident fund contribution 92,416,066 86,528,924 Payment to recognised gratuity fund 3,476,910 101,168,252
22 FINANCIAL RISK MANAGEMENT The Group’s activities expose it to a variety of financial risks: market risk (including
currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk.
The condensed interim consolidated financial information does not include all financial risk management information and disclosures required in the annual financial statements, and should be read in conjunction with the Group’s annual financial statements as at 30 September 2017.
There have been no changes in the risk management policies since the year end. 23 RECONCILIATION OF MOVEMENTS OF LIABILITIES TO CASH FLOWS ARISING FROM FINANCING ACTIVITIES
31 March 2018 Liabilities (long term and short term) Redeemable Long term Liabilities against assets Short term Accrued profit / capital - finances - subject to finance borrowings - interest secured secured lease - secured secured / markup Rupees
Balance as at 01 October 2017 83,333,333 13,532,285,027 306,472,177 13,783,388,645 277,241,631 Changes from financing cash flows Loans received during the period – 3,069,264,228 – 27,526,350,011 – Loan repaid during the period (55,555,556) (1,713,596,720) (89,312,604) (15,268,631,455) – (55,555,556) 1,355,667,508 (89,312,604) 12,257,718,556 – Other changes - Liability related Interest expense for the period – – – – 1,058,052,610 Interest paid during the period – – – – (958,036,035) Net change in cash and cash equivalent – – – (771,568,602) – Assets acquired on finance lease – – 63,956,000 – – Total liability-related other changes – – 63,956,000 (771,568,602) 100,016,575 Balance as at 31 March 2018 27,777,777 14,887,952,535 281,115,573 25,269,538,599 377,258,206
Notes to the Condensed Interim Consolidated Financial Information (Un-audited)FOR THE HALF YEAR ENDED 31 MARCH 2018
24 The Finance Act, 2017 introduced a tax at 7.5% under Section 5A of the Income Tax Ordinance, 2001 on every public company other than a scheduled bank or modarba, that derives profits for tax year and does not distribute at least 40% of the after tax profit within six months of the end of said tax year through cash or bonus shares. However, subsequent to the period end, the Finance Act, 2018 has been promulgated and approved which has amended Section 5A and has reduced the limit of profit distribution in the form of cash dividend from 40% to 20% and the rate of tax from 7.5% to 5%.
The Board of Directors of the Holding Company intends to distribute sufficient cash dividend for the year ending 30 September 2018 to comply with the above stated requirements. Accordingly, no provision for tax on undistributed reserves has been made in this condensed interim consolidated financial statements.
25 DATE OF AUTHORIZATION The condensed interim consolidated financial information for the half year ended 31
March 2018 was authorized for issue by the Board of Directors on 22 May 2018.
26 EVENTS AFTER BALANCE SHEET DATE Subsequent to the period end, the Finance Act, 2018 has been promulgated and
approved through which certain amendments were made in the income tax, sales tax, federal excise duty, custom act and other related laws. The amendments include super tax imposed through Finance Act, 2015 is extended upto tax year 2020 and corporate tax rate reduced to 29% for tax year 2019, thereafter, the rate will reduce by 1% annually until 2023.
Chief Financial Officer Chief Executive Director
Notes
Notes
Notes
INVESTOR’S AWARENESSIn pursuance of SRO 924(1)/2015 dated 09 September 2015 issued by the Securities and Exchange Commission
of Pakistan (SECP), the following informational message has been reproduced to educate investors: