Shahmurad Sugar Mills : Transmission of Quarterly Report for the Period Ended 31-03-2023

SHAHMURAD SUGAR MILLS LIMITED

Half Yearly Results for the period

1st October 2022 to 31st March, 2023

DIRECTORS' REPORT

Asslamu-o- Alaikum

With great pleasure, I take this opportunity to present before you on behalf of the Board un-audited financial statements of your company for the period ended March 31, 2023. The financial statements have been reviewed by the Auditors as required under the Code of Corporate Governance.

Salient features of production and Financial Statements are as under:

Segment wise performance is elaborated as under:

SUGAR DIVISION

During the period under review, the sugarcane crop was not good as it was in the corresponding period of last year. For the crushing season, the Government notified the minimum support price of sugarcane at Rs.302/= per forty kgs of cane as against Rs.250/= per forty kgs notified last year.

The mill crushed 567,913 metric tons of cane against 601,695 metric tons crushed last year. Sugar produced was 60,303 metric tons as against 66,683 metric tons produced last year. During the current period, the production of sugar is lower than last year by 6,380 metric tons or 9.57 percent. The decrease in the production of sugar was mainly due to the non-availability of raw material in the adjoining area of the mill as required to continue the crushing. The recovery rate also declined from 11.08 percent to 10.60 percent during the current year. The condition of crops in the province was not good due to the scarcity of water during the maturing period of sugarcane. It is estimated that production of sugar during the current year would be lower than last year but expected to meet the requirement of the country.

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ETHANOL DIVISION

During the period under consideration, the Ethanol Division produced 34,537 metric tons of ethanol as against 34,150 metric tons produced last year which is slightly higher than produced in the same period of last year. This was due to the timely procurement of raw material. The sales revenue of the ethanol division has also increased due to higher prices in terms of foreign currency and deterioration in the value of local currency which increased the sale revenue in terms of Pak Rupees. The company exported 33,463 metric tons as against 35,567 metric tons exported last year. It is anticipated that the production during the remaining period of the year would be maintained as compared to the previous year

INSHA ALLAH.

FUTURE OUTLOOK

The future outlook is still uncertain due to global as well as internal challenges. Globally major economies going toward recessionary trends, lower demands, and higher interest rates along with the Russian-Ukrain prolonged conflict are still major factors. Internally our country faces political uncertainty, unstable financial policies, restrictions on trade imports, and delaying IMF program are major concerns for internal economic stability.

The Company's management is well aware of the internal and global challenges and taking all necessary measures to reduce the negative impacts and improve the contribution of ethanol and sugar divisions towards the overall performance of the company.

SUBSEQUENT EVENT AND DIVIDEND

The Board of Directors in their meeting held on May 23, 2023 has declared an interim cash dividend of Rs. 15.00 per shares i.e. 150% for the period ended March 31, 2023. These condensed interim financial statements do not include the effect of interim dividend.

BOARD OF DIRECTORS

During the period under consideration, there was no change in the composition of the Board of directors.

May Allah SWT grant His Blessing and Rehmat for the continued success and growth of Shahmurad Sugar Mills Limited. (Ameen)

Karachi:

Dated: May 23, 2023

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Independent Auditor's Review Report

To the member of Shahmurad Sugar Mills Limited

Report on Review of Condensed Interim Financial Statements

INTRODUCTION:

We have reviewed the accompanying condensed interim statement of financial position of SHAHMURAD SUGAR MILLS LIMITED ("the Company") as of March 31, 2023, and the related condensed interim statement of profit or loss, condensed interim statement of comprehensive income, condensed interim statement of changes in equity and condensed interim statement of cash flows and notes to the condensed interim financial statements for the half year then ended (here-in-after referred to as the "condensed interim financial statements"). Management is responsible for the preparation and presentation of these condensed interim financial statements in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. Our responsibility is to express a conclusion on these condensed interim financial statements based on our review.

The figures of the condensed interim statement of profit or loss and condensed interim statement of comprehensive income for quarters ended March 31, 2023 and March 31, 2022 have not been reviewed, as we were required to review only the cumulative figures for the half year ended March 31, 2023.

SCOPE OF REVIEW:

We conducted our review in accordance with the International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of condensed interim financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

CONCLUSION:

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed interim financial statements are not prepared, in all material respects, in accordance with accounting and reporting standards as applicable in Pakistan for interim financial reporting.

The engagement partner of the review resulting in this independent auditor's report is Shaikh Mohammad Tanvir.

Chartered Accountants

Karachi

Dated: May 24, 2023

UDIN: RR202310225vlsgViXAH

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