QUARTERLY REPORT
SEPTEMBER 2023
Assisting in Development of the SME Sector in Pakistan
CONTENTS
Modaraba Information | 02 |
Directors' Review | 03 |
Condensed Interim Balance Sheet | 07 |
Condensed Interim Profit and Loss Account and | |
Other Comprehensive Income (Un-audited) | 08 |
Condensed Interim Cash Flow Statement (Un-audited) | 09 |
Condensed Interim Statement of Changes in Equity | 10 |
Notes to and Forming Part of the Condensed | |
Interim Financial Statements (Un-audited) | 11 |
www.olpmodaraba.com | For the period ended September 30, 2023 |
01
Modaraba Information
Modaraba Company
OLP Services Pakistan (Pvt) Limited
Directors of Modaraba Company
Mr. Shaheen Amin | Chairman |
Mr. Raheel Qamar Ahmad | Managing Director |
/ Chief Executive Officer | |
Mr. Ramon Alfrey | Director |
Mr. Nausherwan Adil | Independent Director |
Mian Faysal Riaz | Director |
Ms. Naila Hasan | Independent Director |
Ms. Aseya Qasim | Director |
Company Secretary | |
Mr. Muhammad Siddique | |
Audit Committee | |
Mr. Nausherwan Adil | Chairman |
Mr. Ramon Alfrey | Member |
Mian Faysal Riaz | Member |
Human Resource and Remuneration (HR&R) | |
Committee | |
Ms. Naila Hasan | Chairperson |
Mr. Shaheen Amin | Member |
Mr. Raheel Qamar Ahmad | Member |
Risk Committee | |
Mian Faysal Riaz | Chairman |
Mr. Nausherwan Adil | Member |
Mr. Raheel Qamar Ahmad | Member |
Shariah Advisor | |
Mufti Faisal Ahmed |
Auditors
A.F.Ferguson & Co. Chartered Accountants
Bankers/ Financial Institutions
Standard Chartered Bank (Pakistan) Limited (Saadiq) Meezan Bank Limited
United Bank Limited (UBL Ameen) Bank Alfalah Limited (Islamic banking) Allied Bank Limited (Islamic banking) Bank Al Habib Limited (Islamic banking) Habib Bank Limited (Islamic banking)
Pakistan Mortgage Refinance Company Limited
Legal Advisors
Haider Ali Khan
Advocate High Court , Partner,
Fazle Ghani Advocates
Modaraba Company Registered Office
OLP Building, Plot no. 16, Sector no. 24,
Korangi Industrial Area Karachi.
Modaraba Head Office:
Office No. 601, 6th Floor,
Syedna Tahir Saifuddin Memorial Foundation Building,
Beaumont Road, Civil Lines, Karachi. Phone: (021) 38341168 Email:askus@olpmodaraba.com
Lahore Branch:
Office No-08, 1St floor,
Park Lane Tower (Mall Of Lahore) 172-Tufail Road, Lahore Cantt. Phone: (042) 38017006
Islamabad Branch:
Ground Floor, Phase 1, State Life Building No. 5, Nazimuddin Road, Blue Area, Islamabad.
Registrars & Share Registration Office:
Famco Associates (Private) Limited 8-F, Next to Hotel Faran, Nursery,
Block 6, P.E.C.H.S., Shahra-e-Faisal, Karachi. Tel: (92-21)34380101-5
Fax: (92-21) 34380106
Email: info.shares@famco.com.pk
02 | For the period ended September 30, 2023 | www.olpmodaraba.com |
Directors' Review
For the period ended September 30, 2023
The Board of Directors of OLP Services Pakistan (Private) Limited [formerly ORIX Services Pakistan (Private) Limited], the management company of OLP Modaraba (formerly ORIX Modaraba) is pleased to present the unaudited accounts for the three months period ended September 30, 2023.
1. Economic Outlook
The IMF expects Pakistan's economy to perform better in the current and next fiscal years. The International Monetary Fund's (IMF), forecasts a growth of 2.5% for the country's economy in the current year, doubling to 5% in the next fiscal year. This is a significant jump compared to the 0.5% contraction witnessed last fiscal year, signifying that the Fund also expected quicker economic recovery than it had forecast earlier at a 5% GDP growth rate in the 2026-27 fiscal year.
The global lender also kept the growth forecast un¬chan¬ged from its July estimate when it signed a nine-month $3 billion new financing arrangement with Pakistan. However, it revised its estimates upwards for inflation and unemployment rates for current and subsequent fiscal years. The IMF also estimated the unemployment rate in the country to have risen to 8.5% in fiscal 2023 from 6.2% in 2022, significantly higher than the earlier projection of 7%. The current fiscal year's unemployment rate has been projected at 8%.
After transferring $1.2 billion in July, as part of the $3 billion bailout programme for nine months to support the government's efforts to stabilize the country's ailing economy, the IMF is set to send its delegation to Pakistan in the last week of October to review the country's economic performance for the first quarter. Once the review is completed, Pakistan will receive the next instalment of $700 million from the IMF after its board's approval.
2. Financial Highlights
Financial results are summarized as under:
September 30, | June 30, | |
Balance Sheet | 2023 | 2023 |
(Rupees) | ||
Certificate capital | 453,835 | 453,835 |
Total equity | 1,126,054 | 1,176,623 |
Total assets | 6,741,656 | 6,824,579 |
Investment in Ijarah Assets | 1,525,474 | 1,627,562 |
Investments in Diminishing Musharika | 4,176,821 | 4,269,916 |
Redeemable capital | 2,899,355 | 2,896,605 |
Three months ended | Three months ended | |
September 30, | September 30, | |
Profit and Loss | 2023 | 2022 |
(Rupees) | ||
Revenue (net of Ijarah assets depreciation) | 386,752 | 272,033 |
Financial charges | 257,524 | 188,578 |
Reversal of provisions and impairments- net | (6,895) | (11,119) |
Operating expenses | 70,442 | 54,684 |
Profit before modaraba management company's remuneration | 65,681 | 39,889 |
Profit before taxation | 57,094 | 34,674 |
Net profit | 40,199 | 24,619 |
www.olpmodaraba.com | For the period ended September 30, 2023 | 03 |
3. Review of Operations
By the Grace of Allah, your Modaraba's performance during the period under review continued to be strong. The Modaraba's gross revenue (net of Ijarah assets depreciation and including other income) increased by 42.17% from PKR 272.03 million to PKR 386.75 million compared to the corresponding period of last year. The main reason behind this was 'better spreads and an increase in the benchmarking rate of profit during last year. Financial charges increased by 36.56% from PKR 188.58 million to PKR 257.52 million mainly due to upward movement of the deposit rate. Due to strong recovery efforts, provisions that were reversed amounted to PKR 6.90 million as compared to PKR 11.12 million reversal during corresponding period last year. Administrative and operating expenses increased by 28.82% from PKR 54.68 million to PKR. 70.44 million mainly due to high inflation and the increase in utilities etc., but the top line revenue increase translated into a higher Profit before taxation which increased by 64.66% from PKR 34.67 million to PKR
- million and a higher net profit for the quarter which increased by 63.29% from PKR 24.62 million to PKR
- million compared to corresponding period last year.
The portfolio of Ijarah finance, Sukuk investment and Diminishing Musharika finances stood at PKR 5,834 million compared to PKR 5,897 million as at June 30, 2023, showing a marginal decrease of 1.08% during the three months period. Similarly total assets decreased marginally by 1.22% to PKR 6,742 million compared to PKR 6,825 million as at June 30, 2023. During the period under review, the Modaraba booked fresh disbursements to the tune of PKR 568 million as compared to PKR 352 million during the corresponding period last year.
The business has been driven mainly by deepening relationships with selective clientele and initiating relationships with good names. The asset portfolio has a good mix of multi-nationals, large and medium sized local corporates, selective SME relationships and an excellent housing and consumer portfolio.
OLP Modaraba manages and monitors risk exposure very prudently. The evaluation of borrower's credit profile including repayment ability is made at the time of grant of facility and regular oversight is carried out thereon. Further, there are Portfolio Management and Early Alert committees which are responsible to ensure portfolio monitoring and timely alerts for possible untoward scenarios.
4. Credit Rating
The Pakistan Credit Rating Agency Limited (PACRA) has maintained the ratings of your Modaraba as AA (Double A) and A1+ (A one plus) for long-term and short-term respectively. These ratings indicate low expectation of credit risk and very strong capacity for timely payment of financial commitments.
5. Acknowledgement
The Board appreciates the support of regulatory authorities, certificate-holders, customers and business partners and looks forward to their support in future.
Karachi: October 25, 2023
Raheel Qamar Ahmad | Ramon Alfrey |
Managing Director/ CEO | |
Director | |
04 | For the period ended September 30, 2023 | www.olpmodaraba.com |
www.olpmodaraba.com | For the period ended September 30, 2023 | 05 |
06 | For the period ended September 30, 2023 | www.olpmodaraba.com |
CONDENSED INTERIM BALANCE SHEET
AS AT SEPTEMBER 30, 2023
September 30, | June 30, | ||||
Note | 2023 | 2023 | |||
(Un-audited) | (Audited) | ||||
ASSETS | (Rupees) | ||||
Current assets | |||||
Cash and bank balances | 5 | 345,050,620 | 400,254,200 | ||
Ijarah rentals receivable | 6 | 93,961,042 | 103,759,046 | ||
Advances, deposits, prepayments and other receivables | 319,377,245 | 161,625,207 | |||
Short-term investments | 7 | 131,623,612 | 123,858,681 | ||
Current portion of Diminishing Musharaka | 8.3 | 1,305,108,374 | 1,321,802,595 | ||
Total current assets | 2,195,120,893 | 2,111,299,729 | |||
Non-current assets | |||||
Long-term portion of Diminishing Musharaka | 8.3 | 2,871,712,231 | 2,948,113,326 | ||
Ijarah assets | 9 | 1,525,474,234 | 1,627,562,155 | ||
Tangible assets | 10 | 17,538,508 | 17,061,707 | ||
Intangible assets | 11 | 4,173,974 | 2,194,932 | ||
Deferred tax assets | 127,636,351 | 118,347,633 | |||
Total non-current assets | 4,546,535,298 | 4,713,279,753 | |||
TOTAL ASSETS | |||||
6,741,656,191 | 6,824,579,482 | ||||
LIABILITIES AND EQUITY | |||||
Current liabilities | |||||
Current portion of term finance arrangements | 12 | 696,786,086 | 1,146,247,638 | ||
Current portion of security deposits | 195,305,843 | 169,344,276 | |||
Creditors, accrued and other liabilities | 424,723,500 | 415,240,194 | |||
Advance Ijarah rentals received | 8,026,426 | 1,653,873 | |||
Current portion of redeemable capital | 2,716,855,000 | 2,717,105,000 | |||
Profit distribution payable | 13 | 150,062,234 | 59,295,174 | ||
Provision for taxation - net | 142,114,415 | 129,117,535 | |||
Total current liabilities | 4,333,873,504 | 4,638,003,690 | |||
Non-current liabilities | |||||
Long-term portion of term finance arrangements | 12 | 806,578,597 | 503,762,218 | ||
Long-term portion of security deposits | 292,649,724 | 326,691,002 | |||
Long-term portion of redeemable capital | 182,500,000 | 179,500,000 | |||
Total non-current liabilities | 1,281,728,321 | 1,009,953,220 | |||
TOTAL LIABILITIES | 5,615,601,825 | 5,647,956,910 | |||
CERTIFICATE HOLDERS' EQUITY | |||||
Certificate capital | |||||
Authorised certificate capital | |||||
50,000,000 (June 30, 2023: 50,000,000) certificates of Rs. 10 each | |||||
amounting to Rs. 500,000,000 (June 30, 2023: Rs. 500,000,000) | |||||
Issued, subscribed and paid-up certificate capital | |||||
28,500,000 (June 30, 2023: 28,500,000) certificates of Rs. 10 each fully paid in cash | 285,000,000 | 285,000,000 | |||
16,883,530 (June 30, 2023: 16,883,530) bonus certificates of Rs. 10 each | 168,835,300 | 168,835,300 | |||
453,835,300 | 453,835,300 | ||||
Revenue reserve | 91,321,086 | 143,899,235 | |||
Capital reserve | 580,897,980 | 578,888,037 | |||
1,126,054,366 | 1,176,622,572 | ||||
TOTAL LIABILITIES AND EQUITY | |||||
6,741,656,191 | 6,824,579,482 | ||||
CONTINGENCIES AND COMMITMENTS | 14 | ||||
The annexed notes from 1 to 25 form an integral part of these condensed interim financial statements. |
For OLP Services Pakistan (Private) Limited
(Management Company of OLP Modaraba)
SD | SD | SD | SD | |||||
Chief Executive | Director | Director | Chief Financial Officer | |||||
www.olpmodaraba.com | For the period ended September 30, 2023 | |||||||
07
CONDENSED INTERIM PROFIT AND LOSS ACCOUNT AND OTHER COMPREHENSIVE INCOME (UN-AUDITED)
FOR THE THREE MONTHS PERIOD ENDED SEPTEMBER 30, 2023
Three months | Three months | |||
Note | period ended | period ended | ||
September 30, 2023 | September 30, 2022 | |||
(Rupees) | ||||
Ijarah rentals earned | 227,476,889 | 238,337,259 | ||
Income on Diminishing Musharaka arrangements | 272,143,749 | 168,672,049 | ||
Dividend income | 8,945,943 | - | ||
Profit on bank balances | 18,852,681 | 23,471,209 | ||
527,419,262 | 430,480,517 | |||
Financial and other charges | 15 | (257,524,185) | (188,578,006) | |
Depreciation on Ijarah assets | (141,452,618) | (169,911,304) | ||
Reversal of impairment against Ijarah assets | 12,949,261 | - | ||
141,391,720 | 71,991,207 | |||
(Provision) / reversal of provision against Ijarah | ||||
rentals receivable - net | (8,682,347) | 2,481,694 | ||
Reversal of provision against Diminishing Musharaka - net | 2,627,823 | 6,836,842 | ||
Reversal of provision / (provision) against other receivables - net | - | 1,800,000 | ||
135,337,196 | 83,109,743 | |||
Other income | 785,831 | 11,463,484 | ||
Administrative and operating expenses | (70,441,846) | (54,684,162) | ||
65,681,181 | 39,889,065 | |||
Management Company's remuneration | 16 | (6,568,118) | (3,988,907) | |
Provision for services sales tax on the | ||||
Management Company's remuneration | 17 | (853,855) | (518,558) | |
Provision for Sindh Workers' Welfare Fund | 18 | (1,165,184) | (707,632) | |
Profit for the period before taxation | 57,094,024 | 34,673,968 | ||
Taxation | 19 | (16,895,170) | (10,055,451) | |
Profit for the period after taxation | ||||
40,198,854 | 24,618,517 | |||
Other comprehensive income for the period | - | - | ||
Total comprehensive income for the period | ||||
40,198,854 | 24,618,517 | |||
Earnings per certificate - basic and diluted | 20 | 0.89 | 0.54 |
The annexed notes from 1 to 25 form an integral part of these condensed interim financial statements.
For OLP Services Pakistan (Private) Limited
(Management Company of OLP Modaraba)
SD | SD | SD | SD | ||||||
Chief Executive | Director | Director | Chief Financial Officer | ||||||
08 | For the period ended September 30, 2023 | www.olpmodaraba.com | |||||||
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Orix Modaraba published this content on 30 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 October 2023 09:29:41 UTC.