Citrus Leisure : Interim Financial Statements for the Quarter Ended 30.09.2022

C i t r u s L e i s u r e P L C

Interim Financial Statements

For the Quarter ended 30th September 2022

Citrus Leisure PLC and Its Subsidiaries

CEO Message

Dear Shareholders,

It is with great pleasure that I share with you the interim financial statements of Citrus Leisure PLC for the quarter ending 30th September 2022.

The Group Hotels had its normal operations during the quarter under review whilst Citrus Waskaduwa and Citrus Hikkaduwa Hotels were operated as Intermediary Care Centers during the previous year which concluded on the 30th of September 2022. Overall, the Group recorded a Revenue of Rs. 301 Mn (YoY 113%) for the quarter ending 30th September 2022 while maintaining GP ratio at 54% against previous year's recorded 67%. Also the Group incurred operating loss amounting to Rs. 151 Mn and Net Loss amounting to Rs. 346 Mn during the quarter under review.

For the Six month ending 30th September 2022, the Group posted Rs. 592Mn (YoY 113%) revenue and 58% GP margin against previous year's recorded 66%. Also Admin and operational expenses increased by 49% and finance cost by 110% compared to previous year same period. Hence Group's profitability decreased significantly and recorded Rs. 248 Mn operating loss and Rs. 608 Mn net loss for the same period. Citrus Hikkaduwa hotel contributed Rs. 144 Mn while Citrus Waskaduwa and Citrus Silver Hotels contributed Rs. 267 Mn and Rs. 181Mn respectively towards the Group's total revenue for the six month period under review.

Citrus Hikkaduwa operated at 42% Occupancy , Citrus Waskaduwa at 34% and Citrus Silver at 46% .The drop in occupancies was mainly due to the lack of tourist arrivals to the country. The Group is hoping that economic activities of the country will pick up during the coming months to ensure higher occupancy levels at all hotels . Revenues of all three restaurants under Citrus Silver Limited, "Steuart &Co Pub", "Ceylon Curry Club" and "Heladiv Tea Club" dropped sharply against the Company's planned numbers due to road access to this area was restricted for a lengthy period of time denying guest to patronise our restaurants in the Fort area.

With the crisis situation in the country, most of the expenses and cost have increased sharply compared to previous year and almost all food and beverage items, other expenses and services have increased over 300%. In addition to this, the sudden introduction of 15% Value added Tax and 2.5% Social Security Contribution Levy have further deteriorated our margins. With the continuous power cuts and shortage of fuel and also the increase in fuel prices, the hotels had to incur significant cost increase as generators had to be used on a daily basis for times ranging from 3 to 10 hours. Also due to the lack of foreigners, the hotels were not able to get the benefit of a higher exchange rate as well. In addition to above, increase in interest rates over 300% have eroded the profitability of the Group.

Future Outlook

It is evident that Russian market will continue to generate marginal numbers during the Winter period but European market are yet to open up as uncertainties in and increases in fares of Air travel has discouraged many European holiday makers to look at long haul travel to the Asian region. The Industry is expecting political stability in the country to ensure shortages of essential commodities do not occur in the immediate future.

Thank You

Chandana Talwatte

Director/Group CEO

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Citrus Leisure PLC and Its Subsidiaries

STATEMENT OF FINANCIAL POSITION

	Group	Company
As at	30.09.2022	31.03.2022	30.09.2022	31.03.2022
	(Unaudited)	(Audited)	(Unaudited)	(Audited)
	Rs.'000	Rs.'000	Rs.'000	Rs.'000
ASSETS
Non-current assets
Property, plant and equipment	6,317,894	6,410,700	4,009	4,496
Investment properties	576,496	576,496	-	-
Right-of-use assets	242,258	273,635	61,820	64,157
Intangible assets	1,818	2,315	328	472
Investments in subsidiaries	-	-	3,551,794	3,551,794
Investment in associate	2,317,679	2,328,609	-	-
Other receivables - related parties	-	-	236,099	180,018
Deferred tax assests	33,762	33,762	-	-
	9,489,907	9,625,517	3,854,051	3,800,937
Current assets
Inventories	67,396	39,208	-	-
Trade and other receivables	101,588	106,368	33,870	20,474
Advances and prepayments	41,729	46,505	3,469	2,783
Other current financial assets	64,511	63,961	15,915	14,959
Tax receivables	15,279	15,569	6,651	6,649
Cash and bank balances	26,164	57,860	7,674	2,942
	316,667	329,470	67,578	47,808
Total assets	9,806,574	9,954,988	3,921,628	3,848,745
EQUITY AND LIABILITIES
Capital and reserves
Stated capital	3,256,173	3,256,173	3,256,173	3,256,173
Revaluation reserve	1,581,654	1,581,654	-	-
Retained earnings/(loss)	(1,902,653)	(1,428,454)	(82,711)	( 51,415 )
Equity attributable to equity holders of the parent	2,935,174	3,409,373	3,173,462	3,204,758
Non-controlling interest	1,200,441	1,334,399	-	-
Total equity	4,135,614	4,743,772	3,173,462	3,204,758
Non-current liabilities
Deferred tax liability	353,870	353,870	-	-
Retirement benefit obligation	47,375	45,194	12,655	11,595
Interest bearing loans and borrowings	2,629,751	2,785,539	-	-
Advance received for leasehold rights	-	-	155,088	155,985
Lease liabilities	109,484	138,962	4,967	8,678
Other payables - related parties	-	-	15,280	14,718
	3,140,480	3,323,566	187,991	190,975
Current liabilities
Trade and other payables	1,336,592	961,899	556,070	437,013
Interest bearing loans and borrowings	1,058,389	800,230	-	11,896
Lease liabilities	85,357	85,357	4,103	4,103
Contract liabilities	50,142	40,165	-	-
	2,530,480	1,887,650	560,173	453,012
Total equity and liabilities	9,806,574	9,954,988	3,921,628	3,848,745
	(138)	679	(1)	1

These Financial Statements are in compliance with the requirements of the Companies Act No. 7 of 2007.

……………………………

D. C. A. Sandanayake

Group Finance Manager

The Board of Directors is responsible for these Financial Statements. Signed for and on behalf of the Board by;

…………………………..	……………………………
E. P. A. Cooray	S. A. Ameresekere
Director	Director
15 November 2022
Colombo	Page 2 of 10

Citrus Leisure PLC and Its Subsidiaries

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

	Quarter ended 30 September	Six month ended 30 September		Year ended
	2022	2021	Variance	2022	2021			Variance		31 March 2022
	(Unaudited)	(Unaudited)				(Unaudited)	(Unaudited)				(Audited)
	Rs.'000	Rs.'000	%			Rs.'000	Rs.'000	%		Rs.'000
Revenue from contracts with customers	301,682	141,784	113%			591,937	277,303		113%	848,527
Cost of sales	(138,792)	(47,333)	193%			(250,813)	(93,242)		169%	(283,632)
Gross profit	162,890	94,451	72%			341,124	184,061		85%	564,895
Other operating income	743	9,491	-92%			3,112	14,576		-79%	21,549
Administrative expenses	(153,607)	(114,072)	35%			(291,575)	(227,958)		28%	(489,706)
Operating expenses	(150,174)	(77,061)	95%			(275,902)	(152,987)		80%	(378,438)
Selling and marketing expenses	(11,630)	(4,849)	140%			(25,534)	(9,616)		166%	(29,678)
Operating loss	(151,777)	(92,040)	65%			(248,775)	(191,924)		30%	(311,378)
Finance expenses	(188,618)	(82,743)	128%			(351,656)	(167,822)		110%	(373,978)
Finance income	2,102	1,646	28%			3,732	2,374		57%	3,116
Share of associate company's profit/(loss), (net of tax)	(7,536)	(8,242)	-9%			(10,929)	(12,344)		-11%	126,124
Impairment of investment in associate	-	-				-	-				(35,935)
Loss before tax	(345,828)	(181,379)	91%			(607,627)	(369,716)		64%	(592,052)
Income tax reversal	(369)	(329)	12%			(530)	3,820		-114%	30,229
Loss for the period/ year	(346,198)	(181,708)	91%			(608,158)	(365,895)		66%	(561,822)
Attributable to:
Equity holders of the parent company	(267,150)	(155,513)	72%			(474,199)	(312,222)		52%	(459,299)
Non-controlling interests	(79,047)	(26,194)	202%			(133,959)	(53,673)		150%	(102,524)
	(346,198)	(181,708)	91%			(608,158)	(365,895)			66%	(561,822)
Other comprehensive income/(loss)
Other comprehensive income not to be reclassified to income
statement in subsequent periods
Revaluation gain on lands and buildings	-	-				-	-				1,127,413
Income tax effect on revaluation of land and buildings	-	-				-	-				(157,838)
Actuarial losses on defined benefit plan		-				-	-				91
-
Income tax effect on defined benefit plan	-	-				-	-				(184)
Share of other comprehensive income of associate	-	-				-	-				2,572
Other comprehensive income for the period/ year net of tax	-	-				-	-				972,054
Total comprehensive loss for the period/ year net of tax	(346,198)	(181,708)				(608,158)	(365,895)				410,232
Attributable to:
Equity holders of the parent company	(267,150)	(155,513)				(474,199)	(312,222)				237,625
Non-controlling interests	(79,047)	(26,194)				(133,959)	(53,673)				172,607
	(346,198)	(181,708)				(608,158)	(365,895)				410,232
Basic loss per share - Basic (Rs.)	(1.00)	(0.58)				(1.77)	(1.17)					(1.72)

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Citrus Leisure PLC and Its Subsidiaries

STATEMENT OF COMPREHENSIVE INCOME

					Company
	Quarter ended 30 September			Six month ended 30 September		Year ended
	2022	2021		Variance		2022	2021		Variance		31 March 2022
	(Unaudited)	(Unaudited)			(Unaudited)		(Unaudited)					(Audited)
	Rs.'000	Rs.'000			Rs.'000		Rs.'000	%			Rs.'000
Revenue	9,015	4,285		110%		18,736	8,353	124%		25,453
Cost of sales	-	-		-		-	-	-		-
Gross profit	9,015	4,285		110%		18,736	8,353	124%		25,453
Other income	448	601		-25%		896	1,049	-15%		1,945
Administrative expenses	(12,601)	(10,357)		22%		(24,747)	(19,607)	26%		(89,692)
Operating expenses	(12,463)	(9,678)		29%		(24,816)	(19,100)	30%		(39,639)
Selling and marketing expenses	-	(26)		-100%		-	(189)	-100%		(189)
Operating Loss	(15,602)	(15,176)		3%		(29,930)	(29,494)	1%		(102,121)
Finance cost	(10,838)	(6,607)		64%		(18,933)	(12,612)	50%		(25,633)
Finance income	11,566	3,646		217%		17,567	6,678	163%		15,350
Loss before Tax	(14,874)	(18,137)		-18%		(31,296)	(35,427)	-12%		(112,404)
Tax expenses	-	-				-	-				410
Loss for the period/ year	(14,874)	(18,137)		-18%		(31,296)	(35,427)	-12%		(111,993)
Other comprehensive income/(loss)
Items that will never be reclassified to profit or loss
Actuarial gainson defined benefit obligations	-	-				-	-				1,710
Deferred tax effect on actuarial gains on defined benefit plan	-	-				-	-				(410)
Other comprehensive income/(loss) for the period/year, net of tax	-	-				-	-				1,300
Total comprehensive loss for the period/year, net of tax	(14,874)	(18,137)		-18%		(31,296)	(35,427)	-12%		(110,694)
Basic loss per share - Basic (Rs.)	(0.06)	(0.07)				(0.12)	(0.13)				(0.42)

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