Sindh Abadgar Sugar Mills : Transmission of Quarterly Accounts for the Period Ended 31 December 2021

UNAUDITED

QUARTERLY FINANCIAL STATEMENTS

1ST QUARTER ENDED DECEMBER 31, 2021

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COMPANY PROFILE

DIRECTORS	Mr. Deoo Mal Essarani	Chairman
	Dr. Tara Chand Essarani	Chief Executive
	Mr. Mahesh Kumar	Director
	Mr. Dileep Kumar	Director
	Mr. Pehlaj Rai	Director
	Mr. Mohan Lal	Director
	Dr. Besham Kumar	Director
	Mr. Muhammad Siddiq Khokhar	Independent Director
	Mr. Zafar Ahmed Ghori	Independent Director
	Ms. Maheshwari Osha	Independent Director
CHIEF FINANCIAL OFFICER	Syed Abid Hussain
COMPANY SECRETARY	Mr. Aziz Ahmed
BANKERS	Allied Bank Limited
	Askari Bank Limited
	Bank Al-Falah Limited
	MCB Bank Limited
	Bank AL Habib Limited
	United Bank Limited
	Meezan Bank Limited
	HBL Foreign Exch. Bank Limited
AUDIT COMMITTEE	Mr. Zafar Ahmed Ghori	Chairman
	Mr. Pehlaj Rai	Member
	Mr. Dileep Kumar	Member
	Dr. Besham Kumar	Member
HR AND REMUNERATION	Ms. Maheshwari Osha	Chairman
COMMITTEE	Mr. Mohan Lal	Member
	Mr. Dileep Kumar	Member
AUDITORS	M/s. Rahman Sarfaraz Rahim Iqbal Rafiq
	Chartered Accountants
REGISTERED OFFICE	209, 2nd Floor, Progressive Plaza, Beaumont Road,
	Karachi-Pakistan.
MILLS	Deh: Deenpur,
	Taluka. Bulri Shah Karim,
	Distt. Tando Muhammad Khan,
	Sindh-73024.
REGISTRAR	JWAFFS Registrar Services (Pvt) Ltd.
	407- 408, Al Ameera Centre,
	Shahrah e Iraq, Saddar, Karachi.
EMAIL ADDRESS	[e-mail]

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DIRECTORS' REPORT

Dear Shareholders,

One behalf of the Board of Directors, it is my privilege to present the un-audited condensed interim financial statements of the Company of the first quarter ended December 31, 2021.

OPERATIONAL RESULTS:
Particulars		December	December
		31, 2021	31, 2020
Season commenced on		28.11.2021	29.11.2020
Period reporting upto		31.12.2021	31.12.2020
Days worked (Gross)	- Days	34	33
Cane crushed	- Tons	75,935	130,943
Average Crushing per day	- Tons	2,233	3,967
Capacity utilization	- %	28	50
Sugar recovery	- %	9.86	9.71
Sugar produced	- Tons	6,625	11,710
Molasses % Cane	- %	4.57	4.44
Molasses produced	- Tons	2,800	5,210

The Company crushed 75,935 M.Tons of Sugarcane compared to 130,943 M.Tons in the comparable period of last year reflecting a 28% utilization of capacity constrained by availability of expensive Sugar-cane against the support price fixed at Rs.250 per 40 Kgs. Accordingly sugar extracted 6,625 M.Tons compared to 11,710 M.Tons in the corresponding period. The sugar recovery stood at 9.86% as against 9.71% achieved in the corresponding period. The company is consciously procuring the Sugarcane in view of high rate demanding by the growers, which often occurred no cane situation resulting intermittent stoppages of Mills.

FINANCIAL RESULTS:
Particulars	December	December
	31, 2021	31, 2020
	Rupees	Rupees
Sales	1,229,162,489	50,668,423
Gross Profit / (Loss)	123,029,126	(15,263,084)
Operating Profit / (Loss)	90,747,921	(43,193,964)
Profit / (Loss) after Taxation	63,517,660	(54,541,379)
Earnings Profit/ (Loss) per share	6.09	(5.23)

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The company achieved sales at Rs. 1.23 billion compared to Rs. 50.67 million in the corresponding period. The increase in sales is attributed to liquidation of last year carry over stock. The gross profit worked out at 7% compared to negative in the corresponding period in view of better selling prices achieved. The administrative expenses has increased at Rs. 31.28 million due to annual increments compared to Rs.26.25 in the corresponding period and financial cost also increased to Rs. 14.39 million amid increase in kibor rates as against Rs. 11.74 million in the corresponding period. In view of better sales the company earned profit after tax Rs. 63.52 million during the quarter compared to Rs. 54.54 million losses sustained in the comparable period. The earning per share stood at Rs. 6.09 per share as against loss per share at Rs. 5.23 in the last period.

FUTURE OUTLOOK.

The government has fixed the price of sugar cane at Rs. 250/= per 40 Kgs in Sindh as compared to Rs. 202 per 40 Kgs in the preceding season increased by 24%. In spite of significant increase in price, the growers are reluctant to sell Sugarcane at this price and demanding throat cut prices at which production of sugar is not viable and accordingly no relief will be available to the masses despite anticipated bumper crop of Sugarcane. The government should play its role and take strict action against the growers, those who are maligning the millers. Even at procuring sugarcane at notified price will make the production of sugar very expensive and in the event sugar price do not increase from their current level the financial health of sugar industry will adversely be effected particular the mills which are situated in lower Sindh.

The SBP move to contain inflation has increased the policy rate from 6.25% to 9.75% which is likely to increase further, will also have negative impact on the company. As such the profitability of the company in future is dependent on the trend of sugar prices. To mitigate the impact of anticipated weak prices of sugar and unviable higher price of sugarcane, the company is more focused towards achieving operational efficiency by improving sucrose recovery from sugarcane with optimal use of capacity, taking necessary steps to reduce the fixed cost and sell the sugar at better price to remain profitable venture and the earn the confidence of shareholders.

The Board of Directors would like to thanks all the shareholders for their continued trust and confidence reposed on them and assured them, the management is quite capable to achieve success with better planning to overcome the difficult situation facing by the company. The directors also place on record their appreciation of the devoted services and hard work put in by the officers and workers of the company. Please pray to GOD to guide us and help us achieve the desired results and prosperous future.

_______________

Dr. Tara Chand Chief Executive

Karachi: January 26th, 2022

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