E B Creasy mpany : Quarterly Financial Statements as of 31-03-2022

E. B. Creasy & Company PLC (PQ 182)

INTERIM FINANCIAL STATEMENTS

For the Twelve Months ended 31st March 2022

Full Year Performance Review - Financial Year 2021-22

At the time of penning this review, the Sri Lankan economy is facing an unprecedented crisis caused by the serious depletion of foreign exchange reserves, continuous depreciation of the Sri Lankan Rupee, rising domestic interest rates stemming from a contractionary monetary policy, and inimical outcomes of the country's rating downgrading. Consequently, the situation has led to enormous social unrest all over the Island and political instability, which pose greater challenges to everyday life of both individuals and businesses.

Despite the challenges encountered in the macroeconomic and social settings, the Group placed on record a resilient performance in the fourth quarter of the financial year. The cumulative performance for the full financial year 2021-22 marked an outstanding growth driven by the Group's commitment to serve its consumers in the core segments, Homecare, Personalcare, Healthcare and foods. The Group continues to execute its strategies to minimize disruptions to supply chains with persistent focus on working capital efficiencies and cost rationalization measures. Against a challenging operating environment, we are encouraged by the progress we have made in the financial year.

The cumulative Group revenue and profit before tax stood at Rs.17.45 billion and Rs.1.13 billion respectively, both reporting an increase of 27 per cent and 36 per cent respectively over the previous year. During the quarter, underlying business grew by 22 per cent over the previous year's comparative quarter. The Group profit before tax of Rs. 234.38 million for Q4 FY 2021-22 signified a quarter-on-quarter increase of 133 per cent. With the Sri Lankan Rupee being free-floated since 9th March 2022, the Group incurred a significant exchange loss on its foreign currency denominated import liabilities during the period under review.

The Group's Homecare and Personalcare segments continued a notable volume-led growth momentum with general trade channel showing a steady progress. The Group's healthcare and foods businesses recorded outstanding results in revenue and profitability over the previous year. During the quarter, the Group made significant investments towards expanding its manufacturing capabilities, including the acquisition of a property at Gonawala, Sapugaskanda to enhance the output of the Homecare product range. Investments were made to increase the production efficiencies of our value-added latex manufacturing plant, which caters to high-end export markets with a view to increasing the Group's foreign exchange earnings. The Company paid an interim dividend of Rs.0.50 per share on 30th March 2022, distributing Rs.126.75 million to its shareholders. As such, the Company paid out a total dividend of Rs.1.50 per share within the FY 2021-22, which amounted to Rs.380.25 million.

The present business climate has presented a set of unprecedented challenges to our teams, which demands innovation, agility and a sense of urgency to respond swiftly to shifts and changes in the external environment. Even under a hostile business climate, the Group remains determined to fulfill its aspiration of delivering sustainable and profitable growth to maintain acceptable levels of return on capital employed, while ensuring our commitment towards our valued stakeholders.

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

COMPANY

	Quarter Ended			Twelve Months Ended
For the period ended 31st March	2022	2021	Variance	2022	2021	Variance
	Rs. '000		Rs. '000	%		Rs. '000		Rs. '000	%
Revenue	1,791,783	1,547,735	16%		5,848,606	5,323,615	10%
Cost of Sales	(1,216,003)		(1,067,606)	14%		(4,126,050)		(3,643,479)	13%
Gross Profit	575,780	480,129	20%		1,722,556	1,680,136	3%
Other Income	7,020	6,317	11%		19,690	14,683	34%
Selling and Distribution Expenses	(194,242)	(214,720)	-10%		(432,413)	(511,601)	-15%
Administrative Expenses	(128,437)	(121,733)	6%		(572,444)	(495,966)	15%
Net Finance Expenses	(35,974)	(53,431)	-33%		(160,149)	(176,141)	-9%
Profit before Tax	224,147	96,562	132%		577,240	511,111	13%
Income Tax Reversal/ (Expense)	34,694	(15,552)	-323%		(28,862)	(90,170)	-68%
Profit for the Period	258,841	81,010	220%		548,378	420,941	30%
Other Comprehensive Income/(Expense)
Items that will not be reclassified to Profit or Loss
Remeasurement of Retirement Benefit Obligation (net of tax)	(2,412)	(31,296)	-92%		(9,645)	(38,529)	-75%
Equity Investments at FVOCI - Net Changes in Fair Value	(243,578)	(79)	-308227%		31,276	(320)	9874%
Deferred Tax Effect on Revaluation Gain due to change in income tax rate	-	277,759	-100%		-	277,759	-100%
Items that are or may be reclassified subsequently to Profit or Loss
Revaluation Gain (net of tax)	243,048		-	100%		243,048		-	100%
Other Comprehensive Income/(Expense) for the period, net of tax	(2,942)	246,384	-101%		264,679	238,910	11%
Total Comprehensive Income for the period	255,899		327,394	-22%		813,057		659,851	23%
Basic Earnings per Share (Rs.)	1.02	0.32			2.16	1.66
Dividend per Share (Rs.)	1.50	0.18			1.50	0.18

Figures in brackets indicate deductions.

The above figures are provisional and subject to audit.

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STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

CONSOLIDATED

	Quarter Ended			Twelve Months Ended
For the period ended 31st March	2022	2021	Variance	2022	2021	Variance
	Rs. '000		Rs. '000	%		Rs. '000		Rs. '000	%
Revenue	4,976,291	4,072,465	22%		17,455,850	13,766,848	27%
Cost of Sales	(3,458,118)		(2,680,311)	29%		(12,377,973)		(9,163,418)	35%
Gross Profit	1,518,173	1,392,154	9%		5,077,877	4,603,430	10%
Other Income / (Expenses)	(5,040)	28,590	-118%		46,047	31,675	45%
Selling and Distribution Expenses	(615,635)	(926,621)	-34%		(1,841,720)	(1,698,397)	8%
Administrative Expenses	(257,284)	(96,101)	168%		(1,444,186)	(1,349,282)	7%
Net Finance Expenses	(405,835)	(161,083)	152%		(735,334)	(474,804)	55%
Share of Results of Equity Accounted Investees	-		(136,340)	-100%		25,505		(280,746)	-109%
Profit before Tax	234,379	100,599	133%		1,128,189	831,876	36%
Income Tax Reversal/ (Expense)	26,651	(121,231)	-122%		(114,363)	(248,248)	-54%
Profit/ (Loss) for the period	261,030	(20,632)	1365%		1,013,826	583,628	74%
Other Comprehensive Income/(Expense)
Items that will not be reclassified to Profit or Loss
Remeasurement of Retirement Benefit Obligation (net of tax)	570	(76,468)	-101%		(12,198)	(89,236)	-86%
Equity Investment at FVOCI - Net Changes in Fair Value	(352,309)	1,251	-28262%		(9,455)	7,133	-233%
Deferred Tax Effect on Revaluation Gain due to change in income tax rate	-	291,445	-100%		-	291,445	-100%
Share of Other Comprehensive Income of Equity Accounted Investees, net of tax	-	37,257	-100%		-	43,149	-100%
Items that are or may be reclassified subsequently to Profit or Loss
Debt Investments at FVOCI - net changes in fair value	-	(4,660)	-100%		-	(4,660)	-100%
Debt Investments at FVOCI - reclassified to Profit or Loss	-	(1,330)	-100%		-	(1,330)	-100%
Revaluation Gain (net of tax)	311,271		-	100%		311,271		-	100%
Other Comprehensive Income/(Expense) for the period, net of tax	(40,468)		247,495	-116%		289,618		246,501	17%
Total Comprehensive Income for the period	220,562	226,863	-3%		1,303,444	830,129	57%
Profit/ (Loss) Attributable to:
Equity Holders of the Parent	310,665	(45,503)			1,004,494	510,615
Non-Controlling Interest	(49,635)		24,871			9,332		73,013
Profit/ (Loss) for the period	261,030	(20,632)			1,013,826	583,628
Total Comprehensive Income/ (Expense) attributable to:
Equity Holders of the Parent	255,411	201,070			1,280,611	753,801
Non-Controlling Interest	(34,849)		25,793			22,833		76,328
Total Comprehensive Income for the period	220,562		226,863			1,303,444		830,129
Basic Earnings/ (Loss) per Share (Rs.)	1.23	(0.18)			3.96	2.01
Dividend per Share (Rs.)	1.50	0.18			1.50	0.18

Figures in brackets indicate deductions.

The above figures are provisional and subject to audit.

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STATEMENT OF FINANCIAL POSITION

	GROUP	COMPANY
As at	31.03.2022	31.03.2021		31.03.2022	31.03.2021
	Unaudited		Audited	Unaudited		Audited
	Rs. '000		Rs. '000	Rs. '000		Rs. '000
ASSETS
Non-Current Assets
Property, Plant & Equipment	6,303,509	5,043,655		4,672,577	3,639,867
Investment Property	2,800	2,800		-	-
Intangible Assets	208,047	240,233		13,063	42,170
Right of Use Asset	147,800	139,463		241,170	257,467
Investments in Subsidiaries	-	-		2,070,397	1,916,267
Other Financial Assets measured at Fair Value through OCI	1,159,042	503,945		496,533	1,443
Other Financial Assets measured at Amortised Cost	-	54,175		-	-
Investment in Equity Accounted Investees	-	198,333		-	261,321
Deferred Tax Asset	357,796		357,796		-		-
Total Non-Current Assets	8,178,994	6,540,400		7,493,740	6,118,535
Current Assets
Inventories	3,718,830	2,819,376		1,594,120	966,819
Trade and Other Receivables	3,012,962	2,560,854		94,549	57,204
Amount Due from Related Companies - Trade	-	-		1,604,818	1,010,043
Amount Due from Related Companies - Non - trade	84,347	279,725		333,651	741,636
Loans due from Related Parties	252,332	164,232		189,332	131,232
Income Tax Recoverable	-	16,069		-	-
Short term Investments	43,532	-		-	-
Cash and Cash Equivalents	1,626,806		711,400		583,715		8,341
Total Current Assets	8,738,809		6,551,656		4,400,185		2,915,275
Total Assets	16,917,803	13,092,056		11,893,925	9,033,810
EQUITY AND LIABILITIES
Equity
Stated Capital	25,731	25,731		25,731	25,731
General Reserves	9,548	9,548		9,548	9,548
Revaluation Reserve	2,647,175	2,965,733		2,300,647	2,057,599
Retained Earnings	2,372,642		1,153,818		2,362,926		2,173,262
Equity Attributable to Equity Holders of the Company	5,055,096	4,154,830		4,698,852	4,266,140
Non-Controlling Interest	336,749		350,616		-		-
Total Equity	5,391,845	4,505,446		4,698,852	4,266,140
Non-Current Liabilities
Loans and Borrowings	1,358,357	143,593		1,216,386	44,134
Lease Liabilities	199,849	189,176		259,548	262,328
Deferred Income and Capital Grants	4,008	4,268		4,008	4,268
Deferred Tax Liability	642,380	572,090		496,123	442,769
Retirement Benefit Obligations	1,067,363		968,081		734,482		645,971
Total Non-Current Liabilities	3,271,957	1,877,208		2,710,547	1,399,470
Current Liabilities
Loans and Borrowings	4,412,383	2,176,732		2,862,926	1,570,745
Lease Liabilities	34,107	30,164		22,276	25,053
Current Taxation Payable	38,716	150,126		15,931	90,582
Trade and Other Payables	3,036,878	3,238,218		812,684	943,769
Amount Due to Related Companies	88,156	13,719		404,606	58,039
Bank Overdrafts	643,761		1,100,443		366,103		680,012
Total Current Liabilities	8,254,001		6,709,402		4,484,526		3,368,200
Total Equity and Liabilities	16,917,803		13,092,056		11,893,925		9,033,810
Net Assets Value Per Share Rs.	19.94	16.39		18.53	16.83

The above figures are provisional and subject to audit.

I certify that these Financial Statements are prepared in compliance with the requirements of the Companies Act No.7 of 2007.

-

SGD

Ravi Rathnasekara Chief Financial Officer

The Board of Directors is responsible for the preparation and presentation of these Financial Statements.

These Financial Statements were approved and signed for and on behalf of the Board of Directors of E. B. Creasy & Company PLC.

SGD	SGD
R.C.A.Welikala	S.W.Gunawardena
Director	Director
24th May 2022

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