Quarterly Financial Statements - 30.06.2025

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED 30JUNE 2025

The Kandy Hotels Company (1938) PLC

A Member of the Galle Face Hotel Group of Companies

Corporate Information

Name of the Company

The Kandy Hotels Company (1938) PLC

Company Registration No.

PQ 201

Legal Form

A public quoted company with limited liability

Stock Exchange Listing

The ordinary shares of the Company are listed on the Colombo Stock Exchange of Sri Lanka.

Board of Directors

Sanjeev Gardiner - Chairman Priyantha Maddumage Nilanga Dela

Shalike Karunasena

Asela Indrajith Fernando - Independent Non Executive Director Nirmal De Soysa Cooke - Senior Independent Director

Registered Office

No.327, Union Place, Colombo 02. Tel 011-7657900, 011 2421847

Email : Corporateoffice@ceylonhotels.net Corporate website: https://www.chcplc.com

Secretaries

Deloitte Corporate Services (Private) Limited (formerly known as Accounting Systems Secretarial Services (Pvt) Limited)

No 100, Braybrooke Place, Colombo 02.

Tei:- 011-5444425/ 011-5444426

External Auditors

Messrs. Ernst & Young, Chartered Accountants No.839/2, Peradeniya Road, Kandy.

Tel:- 011-5426426

Hotel Reservations

The Kandy Hotels Company (1938) PLC No. 327, Union Place, Colombo 02.

Tel: 011-7765555-7

Email : gm.queens@kandyhoteIs.Ik, gm.suisse@KandyhoteIs.Ik Website : https://www.queenshoteI.lk, https://www.hotelsuisse.lk

THE KANDY HOTELS COMPANY (1938) PLC

Statement of financial position

(All amounts in Sri Lanka Rupees thousands)

G u Cap n

ASSETS

Non - Current Assets Property, plant & equipment Intangible assets

Right-of-Use Assets

Long term advance to related companies Investment in subsidiary

Investment in joint venture

Current Assets Inventories

Trade and other receivables Advances and prepayments

Amounts due from related companies Income tax recoverable

Cash and cash equivalents

TOTAL ASSETS

EQUITY AND LIABILITIES

Equity

Stated capital

Other capital reserves Merger reserve Retained earnings Total Equity

Non-Current Liabilities

Interest-bearing loans and borrowings Employee benefit obligations

Lease liabilities Deferred tax liabilities

Current Liabilities

Trade and other payables Contract liabilities

Interest-bearing loans and borrowings Lease liabilities

Amounts due to related companies Income tax liabilities

Bank overdrafts

TOTAL EQUITY AND LIABILITIES

Net Assets per Share (Rs.)

The notes on pages 6 to 8 form an integral part of these financial statements.

I certify that these financial statements have been prepared in compliance with the requirements of the Companies Act, No. 07 of 2007.

Kowshika Vijithan Group Accountant

The Board of Directors is responsible for the Dreparation and Dresentation of these financial statements. Approved and signed for and on behalf of the Board of Directors.

August 14, 2025

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THE KANDY HOTELS COMPANY (1938) PLC

Consolidated statement of changes in equity

(All amounts in Sri Lanka Rupees thousands)

Balance at 1 April 2024 Issue of Ordinary Shares

Acquisition under common control (Note 5)

Profit / (loss) for the year

Other comprehensive income

Total comprehensive Income for the year

Transfer of excess depreciation on revaluation Share of other comprehensive income attributable to joint venture

Dividends-(15% Cumulative preference shares)

Balance at 31 March 2025

Profit / (loss) for the period Other comprehensive income

Total comprehensive income for the period

Transfer of excess depreciation on revaluation Dividends-(15% Cumulative preference shares) Balance at 30 June 2025

Balance at 1 April 2023

Issue of Ordinary Shares

Acquisition under common control (Note 5)

Profit / (loss) for the year Other comprehensive income

Total comprehensive income for the year

Transfer of excess depreciation on revaluation Share of other comprehensive income attributable Dividends-(15% Cumulative preference shares) Balance at 31 March 2024

Issue of Ordinary Shares

Acquisition under common control (Note 5)

Profit / (|oss) for the period Other comprehensive income

Total comprehensive income for the period

Transfer of excess depreciation on revaluation Dividends-(15% Cumulative preference shares) Balance at 30 June 2024

The notes on pages 6 to 8 form an integral part of these financial statements.

-03-

THE KANDY HOTELS COMPANY (1938) PLC

Statement of changes in equity - Company

p t I

R

e e es

(All amounts in Sri Lanka Rupees thousands)

ted

VOC

e

Balance at 1 April 2024 Profit / (loss) for the year

Other comprehensive income

Total comprehensive income for the year

Transfer of excess depreciation on revaluation Dividends-(15% Cumulative preference shares) Balance at 31 March 2025

Profit /(loss) for the period Other comprehensive income

Total comprehensive income for the period

Transfer of excess depreciation on revaluation Dividends-(15% Cumulative preference shares) Balance at 30 June 2025

tated ap

R

Retalned

Totlat IEiqtyu

e

FVO Res e

Balance at 1 April 2023

Issue of Ordinary Shares

Acquisition under common control (Note 5)

Profit / (loss) for the year Other comprehensive income

Total comprehensive income for the year

Transfer of excess depreciation on revaluation Dividends-(15% Cumulative preference shares) Balance at 31 March 2024

Profit / (loss) for the period Other comprehensive income

Total comprehensive income for the period

Transfer of excess depreciation on revaluation Dividends-(15% Cumulative preference shares) Balance at 30 June 2024

The notes on pages 6 to g form an integral part of these financial statements.

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STATEMENT OF CASH FLOWS

(All amounts in Sri Lanka Rupees thousands) For the three months ended June 30,

Profit/(loss) before income tax from operations )

Adjustments for:

Depreciation of property, plant and equipment Amortization of intangible assets

Amonization of Right-Of- Use assets Provision for employee benefit obligation Finance income

Finance expenses

Provision for obsolete and slow moving stock Provision/ write off for bad and doubtful debts Provision for amounts due from related companies Write back of payables

Net foreign exchange (gain)/ losses Share of results of joint venture

Operating profit/ (loss) before working capital changes

(Increase)/decrease in inventories (Increasej/decrease in trade and other receivables

(Increase)/decrease in amounts due from related parties """ " (Increase)/decrease in advances and prepayments

Increase/(decrease) in trade and other payables Increase/(decreasej in contract liabilities Increase/(decrease) in amounts due to related panies

Cash generated from/ (used in) operations

Income taxes paid Interest paid

Employee benefit obligations paid

Net cash generated from/(used in) operating activities

Cash flows from investing activities

Purchase/(disposal) of property, plant and equipment Purchase/(disposal) of intangible assets

Interest income received

Investment in Joint Venture

Acquisition through business combination Net change in related pany borrowings

Net cash generated from/(used in) investing activities

Cash flows from financing activities Loan Repayment during the period Payment of lease liabilities

Net cash flow from /(used in) financing activities

Net increase/(decrease) in cash & cash equivalents Movement in cash & cash equivalents

At the beginning of the year

Net increase/ (decrease) in cash & cash equivalents At the end of the year

Cash and cash equivalents at the end of the financial year consist of the following.

Cash in hand and banks Bank overdrafts

The notes on pages 6 to 8 form an integral part of these financial statements.

- 05 -

Notes to the condensed consolidated interim financial statements

(all amounts in the notes are in Sri Lanka Rupees thousands unless otherwise stated.)

1. General Information

   The Kandy Hotels Company (1938) PLC ("the Company") is a public limited liability company incorporated and domiciled in Sri Lanka and is listed on the Colombo Stock Exchange. The registered office of the Company is located at No. 327, Union Place, Colombo 02.

   The Company and its subsidiaries (together "the Group") refer to The Kandy Hotels Company (1938) PLC, Suisse Hotel (Pvt) Limited, United Hotels Company Limited, Tissa Resort (Pvt) Limited, Ceylon Hotels Maldives (Pvt) Limited and the Group's interest in equity-accounted investees. Suisse Hotel Kandy (Pvt) Limited is a joint venture for the Group.

2. Basis of preparation

   The condensed interim financial statements for the quarter ended June 30, 2025, of the Company and the Group have been prepared in accordance with Sri Lanka Accounting Standard (SLAS) LKAS 34, 'Interim Financial Reporting'. These interim statements should be read in conjunction with the audited financial statements for the year ended March 31, 2024.

3. Segment information

   A segment is a distinguishable component of an enterprise that is engaged in either providing products or services (business segment) or in providing products or services within a particular economic environment (geographical segment), which is subject to risks and rewards that are different from those of the segment. However, there are no distinguishable components to be identified as segments for the company.

4. Accounting policies and estimates

   The accounting policies are in line with the policies published in the audited financial statements for the year ended March 31, 2024.

   The preparation of condensed consolidated interim financial statements requires management to make judgments, estimates and ass umptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.

   In preparing the condensed consolidated interim financial statements, the significant judgments made by the management in applying the Group's accounting policies and the sources of uncertainty in estimates are consistent with the audited financial statements for the year ended March 31, 2024.

5. Effect of changes in composition of the Group

   There has not been a change in the composition of the Group which require disclosure in the financial statements for the quarter ended June 30, 2025.

6. Stated Capital

   The number of shares representing the stated capital is 754,309,253 ordinary shares and 50,000 fully paid, cumulative preference shares as of June 30, 2025.

7. Contingent liabilities

   There has not been a significant change in the nature of the contingent liabilities, which were disclosed in the audited financial statements for the year ended March 31, 2024.

8. Comparative information

   Where necessary, comparative figures have been adjusted to conform with the changes in presentation in the current year.

   - 06 -

   THE KANDY HOTELS COMPANY (1938) PLC

   Notes to the condensed consolidated interim financial statements

   (all amounts in the notes are in Sri Lanka Rupees thousands unless otherwise stated.)

9. Related Party Transactions

   The company carrie s out transactions in the ordinary course of its business with thr following i elated entities, whose details are reported below:

   For the 03 months ended 30th June In LKR '000

   1. Transactions with Parent Company

      Note

      Company 2025

      2024

      Ceylon Hotels Corporation PLC
      Net Temporary Advance	B	(15,500)	69,5 12
      Expenses paid by CHC on behalf of the Company	A	75
      Settlement of expenses paid to CHC	A	(150)

   2. Subsidiaries and affiliates

      Expenses incurred by affiliates on behalf of KHC Expenses incurred by KHC on behalf of affiliates	A A		27
      Reimbursement of expenses incurred by affiliates on behalf of KHC	A
      Service provided by GFH Mgt Co. (Pvt) Limited	A	(4,125)	(3,917)
      Settlement of fees for services provided by GFH Mgt Co. (Pvt) Limited	A
      Temporary Advance	B	(79,050)	(188,690)
      Interest charged for the advances provided by KHC	B	177	177
      nterest charged to affiliates for the advances obtained	B	(26,093)
      Non recurrent Related Party Transactions
      There are no non-recurrent related party transactions for the period ended 30th June 2025.

      Note :

      1. Transactions carried out in the ordinary course of business and charged at the face value of the expenses.

      2. Temporary advances given in the ordinary course of business and no interest is charged on the outstanding balances. Payable on demand and short term in nature.

      3. Terms and conditions related to intercompany borrowings/lendings.

         Company	Party	Repayment
         The Kandy Hotels Company (1938) PLC	Borrower	wPrR + 1.5%
         United Hotels Company Limited	Lender

10. Events after the reporting period

No circumstances have arisen since the statement of financial position date that require adjustments to, or disclosure in the financial statements.

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THE KANDY HOTELS COMPANY (1938) PLC

Share Information

1. Public shareholdings

   Information pertaining to public shareholding is as follows:

   Public holding percentage Public shareholding

   Number of public shareholders

   Float adjusted market capitalisation (Rs.)

   30 June 2025 30 June 2024

   15.98% 15.95%

   120,513,114 120,295,503

   2,007 2,007

   1,446,463,424 938,436,142

   The Company is not in compliance with the Minimum Public Holding requirements in relation to a Company listed on the Main Board, as per Rule 7.13.1.(a) of the Listing Rules of the Colombo Stock Exchange ('CSE'). Accordingly, the Company was transferred to the Second Board on 29 February 2024.The Company will continue to make appropriate market disclosures in this regard.

2. Directors' shareholdings

   The details of shares held directly by the Directors and their close family members as at June 30, 2025 are as follows.

   Name of Director	Number of shares
   	Ordinary	Preference
   Mr. Sanjeev Gardiner	87,500	9,SOO

   None of the Directors and their close family members other than those disclosed above directly held any shares in the Company.

   Names of shareholders	Positlon	No of Shares
   Ceylon Hotels Corporation PLC	1	528,661,003	70.09
   Ceylon Hotels Investment (Pvt) Ltd	2	49,715,471	6.59
   Adiuvat Investment Fund	3	36,582,097	4.85
   Progruss Investments Limited	4	32,863,522	4.36
   Seylan Bank PLC/ Hotel International (Pvt) Ltd	5	32,641,938	4.33
   Hotel International (Private) Limited	6	22,156,619	2.94
   Mr. N.V.S. Saackville	7	4,368,000	0.58
   Mr. P.R.F. Collas	8	1,965,250	0.26
   Mr. G.C. Goonetilleke	9	1,945,755	0.26
   Mrs. L. Ratwatte	10	1,853,000	0.25
   Mr. P.V. Gunasekera	11	1,750,000	0.23
   Mrs. M.F. Gunasekera	11	1,750,000	0.23
   Mrs. A.U.R. Pethiyagoda	13	1,500,000	0.20
   Mr. J. Laravoire	14	1,496,250	0.20
   Mr. E. Laravoire	14	1,496,250	0.20
   Ms. M. Chevallaz	14	1,496,250	0.20
   Mr. P. Chevallaz	14	1,496,250	0.20
   Mr. A. Chevallaz	14	1,496,250	0.20
   Ms. H. Sauties	14	1,496,250	0.20
   Mr. J.P. Sauties	14	1,496,250	0.20
   Mr. J.F.C. Badcock	21	1,034,250	0.14
   Mr. F.D.M. Badcock	21	1,034,250	0.14
   Sub total		730,294,905	96.82
   Balance held by others		24,014,348	3.18
   Total number of shares		754,309,253	100.00

3. Twenty two largest ordinary shareholders of the Company

   
   
   

   2

   4

   S 6

   7

   8

   g 10

   11

   12

   13

   14

   15

   16

   17

   18

   19

   20

   21

   22

4. Market Price per share

For three months ended 30 June

2025

2024

(Rs.) (Rs.)

Highest Market Price Lowest Market Price Last Traded Price

13.00

10.00

12.00

8.80

7.80

7.80

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