MPICO : Y2022 Financials

SUMMARY AUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2022

MPICO PLC REG. NO 1495

SUMMARY CONSOLIDATED AND SEPARATE STATEMENTS OF PROFIT OR LOSS		SUMMARY CONSOLIDATED AND SEPARATE STATEMENTS OF CHANGES IN EQUITY
AND OTHER COMPREHENSIVE INCOME					FOR THE YEAR ENDED 31 DECEMBER 2022
	GROUP	COMPANY			GROUP	COMPANY
	31-Dec-22	31-Dec-21	31-Dec-22	31-Dec-21			31-Dec-22		31-Dec-21	31-Dec-22		31-Dec-21
	K'000	K'000	K'000	K'000			K'000		K'000	K'000		K'000
Rental income	6,841,041	6,613,794	2,468,693	2,392,500		At the beginning of the year	68,805,249		63,514,134	33,772,602		32,497,894
Increase in fair value of investment properties	6,690,900	5,425,600	2,428,500	1,737,000
Other income	1,027,878	1,155,745	1,183,365	1,999,034		Distributable profit for the year	1,467,262		1,345,355	1,600,247		870,033
Dividend income from subsidiaries	-	-	1,716,000	-		Non-distributable profit for the year	6,670,206		5,077,233	1,868,090		1,323,898
Total income	14,559,819	13,195,139	7,796,558	6,128,534		Dividend declared - Final 2021	(436,631)		(855,706)	(436,631)		(643,456)
						Dividend declared - Interim 2022	(905,728)		(275,767)	(321,728)		(275,767)
Total operating expenses and finance costs	(5,554,560)	(5,505,991)	(3,543,388)	(2,973,065)			75,600,358		68,805,249	36,482,580		33,772,602
Profit before tax	9,005,259	7,689,148	4,253,170	3,155,469		SUMMARY CONSOLIDATED AND SEPARATE STATEMENT OF CASH FLOWS
Income tax	(867,783)	(1,266,558)	(784,832)	(961,538)
Profit for the year	8,137,476	6,422,590	3,468,338	2,193,931			GROUP	COMPANY
Distributable profits	1,089,817	1,140,863	1,600,247	870,033			31-Dec-22		31-Dec-21	31-Dec-22		31-Dec-21
		K'000		K'000	K'000		K'000
Non-distributable profits	4,636,627	3,564,801	1,868,091	1,323,898		Cash flows from operating activities
Amount attributable to members of the parent	5,726,444	4,705,664	3,468,338	2,193,931		4,103,207
	Net cash generated by/(used in) operations		3,519,871	1,244,935		1,314,853
Amount attributable to non-controlling interests	2,411,032	1,716,926	-	-
	Returns on investment and servicing of finance
	8,137,476	6,422,590	3,468,338	2,193,931		-
		Dividend received		-	1,716,000		557,750
Issued shares	2,298,047,460	2,298,047,460				Interest received	900,847		1,036,240	284,096		279,786
			Interest paid	(720,909)		(737,444)	(167,126)		(175,921)
Basic earnings per share (K)	2.49	2.05
- Distributable (K)	0.47	0.50				Dividend paid	(758,359)		(919,223)	(758,359)		(919,223)
			Dividend paid to non-controlling shareholders	(584,000)		(212,250)	-		-
- Unrealised (K)	2.02	1.55
						Net cash flow generated from returns on	2,940,786
						investment and servicing of finance		2,687,194	2,319,546		1,057,245
SUMMARY CONSOLIDATED AND SEPARATE STATEMENTS OF FINANCIAL POSITION
	Taxation paid	(1,443,688)		(1,840,436)	(1,209,198)		(781,137)
AS AT 31 DECEMBER 2022
					Net cash generated from operating activities	1,497,098		846,758	1,110,348		276,108
	GROUP	COMPANY		Additions to plant and equipment	(30,628)		(63,385)	(23,442)		(39,519)
	31-Dec-22	31-Dec-21	31-Dec-22	31-Dec-21
		Proceeds on disposal of equipment	2,223		68,377	2,223		68,371
	K'000	K'000	K'000	K'000
		Additions in capital work in progress	-		(12,651)	-		-
EQUITY AND LIABILITIES
					Staff long-term loan granted	13,324		(35,252)	13,324		(35,248)
SHAREHOLDERS' EQUITY	114,902					Net cash used in investing activities	(15,081)		(42,911)	(7,895)		(6,396)
Ordinary share capital	114,902	114,902	114,902
Distributable reserves	5,906,364	5,574,906	9,699,948	8,858,060		Cash flow from financing activities
Unrealised reserves	37,643,559	33,006,932	18,040,792	16,172,702
	Repayment of borrowings	(437,095)		(284,439)	-		-
Share premium	8,626,938	8,626,938	8,626,938	8,626,938		Net cash used in financing activities	(437,095)		(284,439)	-		-
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF
PARENT COMPANY	52,291,763	47,323,678	36,482,580	33,772,602		Net increase in cash and cash equivalents	1,044,922		519,408	1,102,453		269,712
Non-controlling interests	23,308,595	21,481,571	-	-		Cash and cash equivalents at the beginning
	of the year	(665,268)		(1,184,676)	(1,027,129)		(1,296,841)
TOTAL EQUITY	75,600,358	68,805,249	36,482,580	33,772,602		Cash and cash equivalents at the end of the year	379,654		(665,268)	75,324		(1,027,129)
LIABILITIES						BASIS OF PREPARATION
Non-current liabilities	11,159,743	13,801,893	5,751,748	5,238,579		The summary consolidated and separate financial statements are prepared in order to meet the Malawi
Current liabilities	5,729,067	1,823,706	1,433,427	730,393
Bank overdraft	-	1,092,570	-	1,092,570		Stock Exchange Listing Requirements for summarised financial statements. The directors have considered
						the requirements of the Malawi Stock Exchange and believe that the summary statements of financial
TOTAL LIABILITIES	16,888,810	16,718,169	7,185,175	7,061,542		position, summary statements of comprehensive income, summary statements of changes in equity
	and summary statements of cash flows are sufficient to meet the requirements of the users of the
TOTAL EQUITY AND LIABILITIES	92,489,168	85,523,418	43,667,755	40,834,144		summary consolidated and separate financial statements. The amounts in the summary consolidated
	and separate financial statements are prepared in accordance with the framework concepts and the
ASSETS						measurement and recognition requirements of International Financial Reporting Standards. The
					summary consolidated and separate financial statements have been derived from the Annual Consolidated
NON-CURRENT ASSETS						and Separate Financial Statements which were approved by the Board of Directors on 14 March 2023
77,786,747	71,095,847				and is available on the company's website, www.mpicomw.com.
Investment properties	23,928,707	21,500,207		2022 FINANCIAL YEAR RESULTS PUBLICATION COMMENTARY
Other assets	3,415,988	2,609,980	14,943,309	15,011,669
Total non-current assets	81,202,735	73,705,827	38,872,016	36,511,876		Review of the results
CURRENT ASSETS						The MPICO plc Board is pleased to announce the results of the Group for the year ended 31 December
					2022. Rental income increased by 3% to MK6.8 billion in 2022 from MK6.6 billion in 2021. The increase is
Trade and other receivables	10,906,779	8,321,307	4,720,415	3,496,577
	mainly due to rent reviews and improved occupancy levels. Total operating expenditure for the year
Promissory notes receivable	-	3,068,982	-	760,250		marginally increased by 1% to K4.85 billion from MK4.79 billion in 2021.
Assets held for sale	-	-	-	-
Cash and cash equivalents	379,654	427,302	75,324	65,441		Profit after tax increased to MK8.1 billion in 2022 from MK6.4 billion in 2021, representing a year-on-year
Total current assets	11,286,433	11,817,591	4,795,739	4,322,268		increase of 27% due to improved total income.
	Government debt increased to MK6.0 billion as at 31 December 2022 (2021: MK4.8 billion) and continued
TOTAL ASSETS	92,489,168	85,523,418	43,667,755	40,834,144		to negatively impact on Group's operations. After the reporting date, further engagements with Government
						did yield positive results. Promissory notes amounting to MK2.9 billion were collected on 05 April 2023.

Government is processing promissory notes amounting to MK2.6 billion and has committed to release them by 31 May 2023.

Outlook*

The economy is projected to grow by 2.5% in 2023 in real terms according to the International Monetary Fund (IMF), compared to an estimated real GDP growth of 0.9% in 2022. Weather shocks such as the Tropical Cyclone Freddy combined with electricity outages and foreign currency challenges, may result in lower than projected economic growth and pressure on inflation.

The Board will continue to monitor the economic developments and take appropriate actions to preserve value for all stakeholders.

Dividend

The Company paid an interim dividend of MK321.7 million in December 2022 (2021: MK275.8 million). The

Directors are recommending a final dividend amounting to MK505.6 million (2021: MK436.6 million) making

a total dividend of MK827.3 million (2021: MK712.3 million) in respect of 2022 profits representing 36 tambala

per share (2021: 31 tambala per share). The Dividend will be paid after approval by the AGM to be held in June 2023.

By order of the Board

Edmund Hami	Edith Jiya
DIRECTOR	CHAIRPERSON

* Unaudited

INDEPENDENT AUDITOR'S REPORT ON THE SUMMARY CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS TO THE SHAREHOLDERS OF MPICO PLC

Opinion

The summary consolidated and separate financial statements, which comprise the summary consolidated and separate statements of financial position as at 31 December 2022, and the summary consolidated and separate statements of comprehensive income, summary consolidated and separate statements of changes in equity, and summary consolidated and separate statements of cash flows for the year then ended, and the related notes, are derived from the audited consolidated and separate financial statements of MPICO plc for the year ended 31 December 2022.

In our opinion, the accompanying summary consolidated and separate financial statements are a fair summary of the audited consolidated and separate financial statements of MPICO plc, according to the basis described on the basis of preparation paragraph.

Summary consolidated and separate financial statements

The summary consolidated and separate financial statements do not contain all the disclosures required by the International Financial Reporting Standards. Reading the summary consolidated and separate financial statements and the auditor's report thereon, therefore, is not a substitute for reading the audited consolidated and separate financial statements and the auditor's report thereon. The summary consolidated and separate financial statements and the audited consolidated and separate financial statements do not reflect the effects of events that occurred subsequent to the date of our report on the audited consolidated and separate financial statements.

The audited consolidated and separate financial statements and our report thereon

We expressed an unmodified audit opinion on the audited consolidated and separate financial statements in our report dated 5 May 2023. That report also includes the communication of key audit matters (KAM). Key audit matters are those matters that in our professional judgement, were of most significance in our audit of the consolidated and separate financial statements for the current year.

Directors Responsibility for the Summary Consolidated and Separate Financial Statements

Directors are responsible for the preparation of the summary consolidated and separate financial statements in accordance with the "basis of preparation paragraph".

Auditor's Responsibility

Our responsibility is to express an opinion on whether the summary consolidated and separate financial statements are a fair summary of the audited consolidated and separate financial statements based on our procedures, which were conducted in accordance with International Standards on Auditing (ISA)810 (Revised), Engagements to Report on Summary Financial Statements.

Chartered Accountants

Vilengo Beza

Partner

26 May 2023