Transmission of Annual Report for the Year Ended 2025-06-30

64th

Company Information

PAGE

02

Vision, Mission, Statement of

Ethics and Business Practices 03

Key Operating and Financial Data 04

Notice of Annual General Meeting (English) 05

Notice of Annual General Meeting (Urdu) 09

Chairman's Review (English) 12

Chairman's Review (Urdu) 13

Directors' Report to the Members (English) 14

Directors' Report to the Members (Urdu)

Statement of Compliance with the Code of

Corporate Governance 22

Independent Auditor's Rev icw report to the Mciiibcrs on Staternen t r›l C‹rrplianc e with Crode of Corporate

Governance Regulations 24

Indcpcndcnt Audittir's Rcport tr› tlic Meiiibci's

Statement of Financial Position 28

Statcmciit of Profit or Loss 29

Statcmcnt ot Comprchcnsivc Income / (Loss) Statement of Changes in Equity

Cash Flow Statement 32

Notes to the Financial Statements 33

Pattern of Shareholding 49

Additional Intormation 49

Jama Punji 50

Form ot Proxy

COMPANY INFORMATION

CHAIRMAN

Mr, Aurangzeb Khan

CHIEF EXECUTIVE DIRECTORS

AUDIT COMMITTEE CHAIRMAN MEMBER

MEMBER

HR &R COMMITTEE CHAIRMAN MEMBER

SECRETARY C.F.O AEDITORS

SHARE REGISTRAR

REGISTERED OFFICE & HEAD OFFICE

Mr. Adam Jadoon

Mr. Aurangzeb Khan

Mr. Amanullali Khan Jadoon Mr. Muhammad Bahauddin Mr. Adam Jadoon

Mr. Hassan Ovais Mrs. Aainna Jadoon Mr. Nusrat Iqbal

Mr. Nusrat Iqbal Mrs. Aamna Jadoon

Mr. Muhammad Bahauddin

Mr. Nusrat Iqbal

Mr. Muhammad Bahauddin Mr. Adam Jadoon

Mr. Sadaqat Khan Mr. Taj Muhammad

Mls Clarkson Hyde Saud Ansari Chartered Accountants

F.D. Registrar Services (SMC-Pvt) Ltd

Office No 1705, 17" Floor, Saima Trade Tower-A,

I.I Chundrigar Road, Karachi Email: info(rrfdregistrar.cont

Khyber Textile Mills Ltd. Baldher, District Haripur, Khybcr Pakhtunkhawa

Baldhcr, District Haripur, Khybcr Pakhtunkliwa

Website address:- https://www.khvbertextile.com Email Address:- info zkhvbertextiIe.com Phone No:- 0995-655048

VISION STATEMENT

To remain a contributor in the local market and to serve the needs ot our valued customers with dedication, by focusing on the requirements of the general public.

MISSION STATEMENT

The Company is dedicated to the following missions:

1. To contribute to the economy through our business activities, thereby supporting both the local and national sectors.

2. To provide employment to residents ot' the surrounding areas, while improving their skills through training and development.

STATEMENT OF ETHICS AND BUSINESS PRACTICES

The Company Khyber Textile Mills Limited (KTML) will be guided by the following principles in achieving its organizational objectives by upholding:

• That Company's affairs are being carried out within the framcwork of existing laws and regulations.

• The accuracy and secure custody of the Company's books and records.

• The respect of employees, suppliers, agents, customers and shareholders.

• The timely payment of amounts due to cmployces, agents and suppliers.

• The maintaining of a healthy and safe work environment.

• The safeguarding of the Company's Assets.

• A drive to ensure that the Company succeeds as a business.

The Company's intcractio» with the stakeholders, including Government and Financial Institutions arc guided by business ethics. Furthermore, the Company adheres to the Companies Act 2017, the Code of Corporate Governance and other relevant Corporate Regulations in maintaining its accounting and fin‹ime iiil pot ic res and procedures.

KEY OPERATING AND FINANCIAL DATA

Khyber Textile Mills Limited 5

Notice is hereby given that the 64* Annual General Meeting ot the Shareholders ot KHYBER TEXTILE MILLS LIMITED will be held on Thursday, the 23'" of October 2025 at the Registered Office of the Company, Baldlicr, District Haripur, Khybcr Pakhtunkliwa at 10:00 am to transact the following business.

1. To receive, consider and adopt the Annual Audited Financial Statements of the Company for the year ended 30" June, 2025 together with the Directors' and Auditor's Reports thereon.

2. To elect seven (7) Members to the Board of Directors, as fixed by the Board ot Directors in accordance with the Companies Act 2017. The tollowing existing Directors who retire under the Companies Act 2017 and being eligible have oflcrcd themselves for re-election as Directors of the Company for the next three (3) years, connencinp li um 25" October 2025.

   1. Mr. Aurangzeb Khan 2) Mr. Amanullah Khan Jadoon

      3) Mr. Muhammad Bahauddin 4) Mr. Adam .ladoon

      5) Mrs. Aamna Jadoon 6) Mr. Hassan Ovais (Proposed Independent Director)

      7) Mr. Nusrat Iqbal (Proposcd Independent Director )

3. To appoint Auditors of the Company for the financial year ending 30" I une 2026 and to fix their remuneration. The Board o1 Directors has rccommended the retiring Auditors M/s Clarkson Hyde Saud Ansari Chartered Accountants, who have consented and, being eligible, be re-appointed to act as Auditors of the Company for the financial year ending 30" Junc 2026.

4. To transact any other ordinary business of the Company with the permission ot' the Chair.

BY ORDER OF THE BOARD

For Khyber Textile Mills Limited

Sadaqat Khan Company Secretary 25"' September 2025

NOTES:

1. Tlic Share transfcr books of the Company will rciiiain closcd front l5" October 2025 to 23" October 2025 (both days inclusive). Physical transfers / CDC Transactions lDs received at the Company's Registrar (F.D. Registrar Services) at close ot' business on 14" October 2025 will be considered in time to determine the above-mentioned entitlement and to attend and vote at the meeting.

2. Members attending the Meeting shall bring along their original Computerized National Identity Card (CNIC) or Passport at the time ot'attending the Meeting.

3. A Member of the Company entitled to attend and vote at the General Meeting may only appoint another Member as proxy to attend and votc in place of the Member at the Mccting. Prox ics in order to be e1f'ective iiiust be received at the Company's registered oftice duly stamped and signed not later than 48 hours before the time ot holding the Meeting. A Member cannot appoint more than one proxy. Copies of both shareholder's and beneficial owners Computerized National Identity Card (CNIC) or Passport must be attached with the proxy fonts.

4. The CDC/sub account holders are required to follow the vinder mentioned guidelines:-

   1. for attending the meeting.

      1. In case ot individuals, the account holder or sub-account holder and/ or the person, whose securities arc in group account arid tlicir registration details arc uploadcd as per the regulations, shall authenticate identity by showing his/her original Computerized National Identity Card (CNIC) or original passport at the time of' attending the meeting.

      2. In case of corporate entity, the Board of Directors' resolution / power of attorney with specimen signature of the noiiiincc shall be prodiiccd at the time of iiiccting.

   2. For appointing proxies:

      1. ln case of individuals, the account holder or sub-account holder and/ or the person, whose securities are in a group account and their registration detail is uploaded as per the regulations, shall submit the proxy foriii as per the above requirement.

      2. The proxy form shall be witnessed by the two persons whose names, addresses and Computerized National Identity Card (CNIC/NICOP/CPOC) or Passport iiiiiiiber shall be iiientioned on the

         Copies of Computerized National Identity Card (CNIC/NICOP/POC) or the passport of the beneficial owners and the proxy shall be furnished with thc proxy form.
         
         

         1. The proxy shall produce his/her original Computerized National Identity Card (CNIC/NlCOP/CPOC) or original passport at the time of the meeting.

         2. In case of corporate cntity, the Board ofDirectors' rcsoltition/power ot attorney with specimen signature shall be submitted to the Company along with proxy form.

5. Shareholders, who want to participatc in tic Amial General Mccting through video-link facility, should update their valid Email address with the Company's Sharc Registrar F.D. Registrar Services at infofii'dregistrar.coin by 14" October, 2025. Shareholders having updated their valid Email address with the Share Rcgistrar and are interested to attend the Annual Gencral Meeting electronically through video-link, may send their request no later than 48 hours before the Annual General Meeting date along with their Name, Folio Number, scanned copy of CNIC, Mobile Number and Email Address to companvsecretaryktml(I.Email.coin. The video-link details will be shared with the rcgistcrcd participants who have provided their Name, Folio Number, scanned copy of CNIC, Mobile Number and Email Address betore the meeting. lt may be noted that no person other than the Member or proxy holder can attend the meeting through video-Iink.

6. Meiiibers are requested to promptly notii any change in their mailing address, E-mail and contact details to the Company Share Registrar Otfice. Members, having physical shares, are advised to intimate any changc in their registered address and shareholdcrs who have not yet submitted photocopies of their CNIC are requested to send the saiiie to the Company's Share Registrar (F.D. Re5istrnr Services. Office No. 1.705, 17"' Floor sainaa Trade Tower-A, I.I Chundrigar Road, Karachi).

7. Shareholders who wish to receive notice of the General Meeting through E-mail are requested to provide, through a lener duly signed by them, their particulars, i.e. Name, Folio/ CDC A/C No., E-mail Address, Contact Numbci and copy of CNIC.

8. The Annual Report including the Annual Audited Financial Statcments ot the Company for the year ended 30"' June 2025 have been placed on the Company's website: https://www.khybertextile.com

9. Section 72 of the Companies Act, 2017 (Act) which requires all companies to replace shares issued by them in physical form with shares to be issued in the Book-Entry-fomi within a period not exceeding tour years trom the date ot the promulgation ot the Act. In order to ensure full compliance with the provisions of the aforesaid Section 72 and to benefit from the facility of holding shares in the Book-

   Eiltiy-Form, thc shareholders who still hold shares irt physical form arc rcqucstcd to convert tllcir shales in the Book-Entry-Form. For further information, please contact the Company's Share Registrar.

10. Any member (including a retiring Director) who seeks to contest election of directors shall file with the Company at its registered office Baldhcr, District Haripur, Khybcr Pakhtunkhwa not later than fourteen ( 14) days betore the said meeting his / her intention to ot't'er himself / herselt tor the election ot the directors in terms of Scction 159(3) of the C ornpanics Act, 20.17 togcthcr with:

    (i) Notice of his / her intention to stand for election, along with duly coiiipleted and signed Eoriii 28 giving his / her consent to act as a Director of the Company if elected (under Section 1.67( 1) of the Companies Act, 20 17), and certity that he/she is not ineligible to become a Director as set out in the provisions of the Companies Act 20.17 Under Section 153 or tinder any applicable laws, Rules and Regulations; and further confimis that he / she holds the qualification shares in accordance with the Anicles of Association of the Corripany.

    Detailed profile along with office address to be placed on the Company's website seven days prior to the date of election.
    
    

    1. Declaration in respect of being compliant with the rcquireiiicnts of thc Listed Companies (Code ot' Corporate Governance) Regulations, 2019 and the eligibility criteria as set out in the Companies Act, 2017 to act as thc director of a listcd Company.

    2. Attested copy of valid CNU and National Tax Number, along with proof of active tax ti1er status.

    3. Declaration to be submitted by Independent Director(s) under Clause I›(3) of the Listed Companies Code of Corporate Governance) Regulation 2019 and Section 166 of the Companies Act, 2017.

    4. An Undertaking on non-judicial stamp paper that he / she meets ihe requirements o1 sub-regulation ( 1 ) of' Regulation 4 of the Companies (Manner and Selection of Independent Directors) Regulations, 201 S.

11. Pursuant to Companies (Postal Ballot) Regulations 201.8, if the number of" persons who otter tlicmscli cs to be elected are more than the number of Directors fixed then for the purpose ot election of Directors and tor any other agenda item subject to the requirements of Sections 143 and 144 of the Companies Act

    20.17, members will be allowed to exercise their right of vote th‹ s postal ballot, that is voting by post and through E-voting, in accordance with requirements and procedure contained in the aforesaid regulations.

12. 
    
    

    the Coinp‹iny has appointed Cl‹arkson Hyde Saud Ans‹u i Uhartcred Accountants Kai.iehi. (a QCR ralcd ‹uidit lirm) to act ‹is ilic Scrrilinizcr ol the Company for Hoc Election o1"Dircctoivs to be transacted iii the Meeting.

13. Sharclioldcrs who wish to participate through c-voting arc requested to send their dcta ils including Name, Folio/CDC Account Number. Email Address. and Contact Number - via Email to the C.oiiipany's Shai e Registrar, £D Regisirar (Pvt) Liiiiited, at intof‹rtdrceistrar.com.

    Khyber T tile Mills Limited 8

    
    
    

14. STATEMENT UNDER SECTION 166 OF THE COMPANIES ACT 2017

This Statement sets out the material facts pertaining to the Ordinary Business as described in the Notice of the Annual General Meeting of the Company. The term of office of the current Directors of the Company will expire on 25" October, 2025. In accordance with section 159(1) of the Act, the Board ofDirectors have fixed the number of Directors to be elected at the AGM as seven (07) to hold the office of Director for a period of three (3) years. Being a listed company, KHYBER TEXTILE MILLS LIMITED is required to have two independent directors on its Board in accordance with the Listed Companies (Code of Corporate Governance) Regulations, 2019. Independent Directors shall be selected in accordance with the provisions of the Act, the Listed Companies (Code of Corporate Governance) Regulations, 2019 and the Companies (Manner and Selection of Independent Directors) Regulations, 2018. Accordingly, the Company shall ensure that two independents are elected in accordance with the procedures for election of directors laid down in Section 159 of the Companies Act 2017. After the contestants file their notice / intention to stand for elections, the Company shall apply following criteria for choosing the appointee for appointment as independent director:

Inclusion of name of independent directors in the data bank maintained by Pakistan Institute of Corporate Governance (PICG) duly authorized by SECP. Respective competencies, diversity, skill, knowledge and experience of the election contestants shall be assessed.

The Company shall exercise due diligence before selecting aperson from the data bank that the contestant meets the independence criteria as mentioned in Section I 66(2) of the Companies Act, 2017.

Further, in accordance with the Listed Companies Code of Corporate Governance Regulation 2019 the Company is also required to have at least one qualified female director elected to the board. The Company has complied with this requirement.

2025 25

')

- J> yCmc)t#o u /›pu LL/=//y>>2

CHAIRMAN'S REVIEW

Respected Shareholders,

I am pleased to welcome you to the 64" Annual General Meeting of Khybcr Textile Mills Limited (the Company) and present the Annual Audited Report for the year ended June 30, 2025. The significant aspects for evaluation of the Company's perfomiance, its results and financial highlights during the fiscal year have been thoroughly elaborated in the Directors' report along with key operating and financial data.

During the period under review, the Company generated significant revenue from its agricultural livestock business and generated additional income front the rental ol vacant buildings and warehouses. However, the Company's textile production operations remained closed due to restrictions on credit facilities imposed by the banks due to ongoing litigation.

The overall performance of the Board of Directors of the Company has been satisfactory. The Board is comprised ot' experienced and knowledgeable individuals with diverse backgrounds, who have played an important positive role in making constructive, strategic, and effective decisions for the Company. Additionally, The Committees ot tlic Board have operated ctficlcntly and assisted the Board of Directors in all key matters.

On behalf of the Board, I would like to thank all the stakeholders tor their continued engagement and support. I ant confident that the Company remains committed to meeting and achieving the expectations of its stakeholders. Additionally, I would like to express our appreciation to the management and staff for their dedication and hard work, which has been instrumental in driving thc progi ess and improvement of the Company.

Mr.Aurangzeb Khan Chairman

Baldher, Haripur 25" September 2025

2025 25

DIRECTORS' REPORT TO THE SHAREHOLDERS

The Board of Directors (BOD) wclcoiiies you to the 64"' Annual General Mccting of the Company and is pleased to present the duly Audited Annual Financial Statements togcthcr with the .'Auditor s Reports along i 'itli otlici relevant statements as required by the Code of Corporate Governance or Pakistan Siock Exchange for the year ended 30" June 2025.

During the period under review, the Company had significant revenue generation from its agricriltural livestock business and additional income trom the rental or vacant buildings and warehouses. However, the Company's textile production remained closed due to restrictions on credit tacilities imposed by the banks.

Note Rupees

Rupees 15,354,500

Less: Administrative Expenses Other Operating Expenses

Financial Expenses - Bank Charges

Fair Value Remeasurement Adjustment - Biological Assets Other Operating Income - Rent

Agriculture Income

17 14,709,097 13,309,832

5,974,903 5,044,665

lS 20

22,209,453 17,539,250 (16,234,550) (12,494,582)

(410,751)

5,909,757 6,937,100

220,110 213,500 (7,104,653) (5,754,4f›3)

(7,l04,fiS3)

21 ( 1,279,495)

(5,S25,ISS)

(5,754,463)

(1,091,994)

(4,662,469)

(4.75)

(5x0)

Dividend

Due to thc nct losses incurrcd for tlic ycar, the Directors have not recommended any dividcnd payout or issuance of bonus shares for the year.

Law Suits against the Company

NBP vs. KTML: A suit for recovery was filed by NBP in the Peshawar High Court (PHC) and following adjIndication in 20.14 the Hon'b1e Banking Judge of the PHC dismissed the suit in lavour of Khyber Textile Mills Limited (KTML). However, NBP tiled an appeal against the judgment, and in April 2025, the Appellate Bench ot the PHC remanded the case to the Banking I udge tor a fresh decision in accordance with the law. KTML's management and lcgal team will continue to vigorously defend the Company's position and remains optimistic that the suit will ultimately be dismissed. For further information, refer to Note 16.

ICP, NBP & Others vs. KTML: A suit lot recovery was filed by ICP, NBP, and others in the Sindh High Court (SHC). The Hon'ble Banking Judge granted KTML's Leave to Defend Application. KTML's position is that this suit is time-barred, as these loans have been repaid. Furthermore, NBP has initiated separate suIts for recovery of the samc financc in two different jurisdictions, which is against the proviSIOI4 Of law. Final arguments in the matter are pending betore the Court. The Company's management remains optimistic that this suit will be dismissed. For fiirther information, ref'er to Note 16.

to the cont inned closurc of tc.stile produciion. while the re-initiation of opci"alions will require a signi tlcant investment to complete Balancing, Modernization and Replacement (B MR) and refiirbislirnent of machinery along w itli securing access tti w orking capital. Despite these challenges, ii is tlic i3oard or Directors and Mana cnacnt's intention to rchabil itatc the textile unit once the banking litisation has rcachcd finality and

credit facilities arc restored.

As per the BOD and Members approval in prior years, the Coiiipany has continued te invest in its revised principal business activity ot agriculture on its abundant land, separate trom the Textile Unit. Over the years, these investments in the °s*cu1niral business have included the constriction of ample housing capacity for cattle, the purchase of livestock, the planting and growing of olive saplings and trees, while improving the Mill's water storage, tvibe well and irrigation systems across the Company's premises. In addition, Management has utilized most ot' the Company's vacant land by transforming and developing the area tor cultivation. The cultivation ot crops grown, has been used in support of the Company's livestock farm, which has enabled a reduction in purchasing of fodder from the market, reducing input costs, thus increasing the farm's profitability. The BOD takes this opportunity to inform the shareholders that despite the restriction on access to credit and continuing inflation, the Company has continued to develop the agricultural farms and operations. Additionally, the Company has made successful sales of cattle, resulting in profitable returns as reflected in the financial accounts annexed herewith.

Moreover. Management has continued to generate further revenue for the Company t* **gh renting out some of its vacant buildings and warehouses. Management has used this financial stream to reinvest in the Company's current operations. Hence, through the successful sales of livestock and rental income, Management has proved that the modified business plan is viable, as the Company is generating revenue and maintaining a positive cash flow, while liabilities have dccrcascd. Further, tlic Company is an active taxpayer, contributing advance tax to the national exchequer. In addition, the revaluation of property, plant and equipment repeatedly carried out by Management, has emphasized the worth of the Company. However, due to charging of substantial depreciation on idle items of plant and equipment, the Company has incurred a net loss for the fiscal year.

Future Plans

Moving forward, Management will continue to repair vacant buildings on the Company's property for warchousing and rental purposcs, thereby utilizing excess space to gcncratc additional income for thc Coiiipany. Furthermore, Management intends, to improve the cultivatable land and invest further in the Company's agricultural livestock tarm and operations to increase revenue. The income derived trom these business activities will be used for maintaining the Company's assets, payment of expenses, meeting the legal ovcrhcads and fulfilling the rcquircincnts tindci' the Coiripanics Act 20.17. Finally, Managcnicnt is optimistic that due to our Company's location near the E-35 Motorway and having access to the CPEC will hopefully present further business opportunities.

Statement of Corporate and Financial Reporting Framework:

The Board of Directors further state that:

1. The hnancial statements under review have been prepared in accordance with the provisions of the Companies Act 20.17 and the International Accounting Standards as applicable in Pakistan.

2. Appropriate accounting policies have been consistently applied in preparation of financial statements and accounting cstiinatcs arc based on reasonable and prudent judgment.

3. Proper books of account have been maintained by the Company accordingly the financial statements prescnt iairly the Company's state or aiiairs, the result o1 its operations, cash flows and changes in equity.

4. The system of internal control of the Company is satisfactory in design and has been effectively implemented and continues to be nionitorcd for improvement.

5. As a result ot overall effort being made to control cost and maximize revenue, there are no significant doubts about the Company's ability to continue as a going concern and therefore no adjustment is required in the recorded assets and liabilities.

6. There has been no material departure from the best practices of corporate governance, as detailed in the listi•s regulations and as applicable to the Company for the year ended 30'"June 2025

7. Key operating and financial results for the last 6 years in a summarized form, are annexed.

S. The Audit Committcc assists the Board in discharging its duties and responsibilities ensuring good coiiipl iancc with Code Of Corporatc Governance iI4ClUding review of reports, Company's financial rcsults and internal control proccdurcs ior Management decisions and cvolving stratcgy ior saicguarding Company's assets and its business potentials.

9. The Audit Committee meets before Board Meetings and its report is presented in the Board Meeting. During thc pcriod undcr repos 4 (four) meetings ot thc Audit Committee were hcld.

Currently, the Board comprises of seven directors, all of them possess diversified experience and suitable skill sets with competencies for safeguarding the interests of stakeholders and the Company. During the period under report 4 (four) iiieetings of the Board ofDirectors were held.

Composition of Board

EXECUTIVE DIRECTOR

Mr. Adam Jadoon

NON-EXECUTIVE DIRECTORS

Mr. Aurangzeb Khan

Mr. Amanullah Khan Jadoon Mr. Muhammad Bahauddin Mrs. Aanuia Jadoon

INDEPENDENT DIRECTORS

Mr. Hassan Ovais Mr. Ntisrat Iqbal

Directors' Training:

No. of Meetings Attended

4

4

4

4

4

4

4

Five Directors, Mr. Muharrrmad Bahauddin, Mr. Adam .Iadoon, Mr. Hassan Ovais, Mrs. Aamna Jadoon and Mr. Nusrat Iqbal, have successtiilly completed the Directors Training Program. The remaining two Directors are exempt ironi the Directors Training Program due to their experience on the Board.

The Directors hereby cndorse the Chaiimai's review on the performance of the Company.

Remuneration of Directors and Chief Executive:

No remuneration was paid to the Directors and Cliicf Executive.

Auditors:

The auditors Mls Clarkson Hyde Sand Ansari, Chartered Accountants have a satisfactory rating tinder the Quality Control Review program or the Institute ot Chartered Accountants ot Pakistan (ICAP) and compliance with the International Federation of Accountants' (IFAC) Guidelines on Code of Ethics, as adopted by the Institute of Chartered Accountants ot Pakistan. They also possess a satisfactory rating from the Audit Oversight Board (AOB). The present auditors, Mls Clarkson Hyde Saud Ansari Chartered Accountants, retire and being eligible, offer tlieiiiselves for re-appointment. As required by the CCG, the Atidit Coiniiiittee has suggested the name of Mls Clarkson Hyde Saud Ansari, Chartered Accountants to act as auditors ot the Company for the financial Year ending 30" June 2026.

Pattern Of Shareholding:

The pattcni of sharcholding as on 30" June 2025 and its disclosure as required by thc Act and Codc of Corporate Governance is annexed with this report. There was no other reported transaction of sale or purchase ot shares ot the Company by Directors, Chiet Executive Otiicer. Company Secretary, Claiet

Financial Officer, Chief Internal Auditor, Chiet Operating Otticer and their spouses or minor children during the year tinder review, except as given in the Pattern of Shareholding.

Compliance with Code of Corporate Governance:

The requirements of the Code ot' Corporate Governance set out by the Pakistan Stock Exchange in their Listing Regulations relevant tor the year ended 30'" June 2025 have been adopted by the Company and have been duly complied with. A statement of compliance is annexed to the report.

Material Changes:

There have been no material changes since year end 30" June, 2024 till date ot the report except as disclosed in this annual repott and the Company has not entered into any commitment which would aft'ect its financial position at the date cxcept for those mentioned iii audited financial statements of the Company for the year ended 30" June, 2025.

Statutory Compliance:

During the year the Company has coniplied with all applicable provisions, filed all rekirns/forms, and furnished all the relevant particulars as re•i•ired under the Companies Act 20.17 and allied rules, the Securities and Exchange Commission of Pakistan (SECP) Regulations and the listing requireiiients.

Related Party Transactions:

All transactions with related parties including pricing policies applied upon recommendation of the Audit Committee and as disclosed in notes to the annual audited financial statements thereon are reviewed and approved by the Board.

Gender Pay Gap:

During the reporting period, due to the ongoing credit restrictions, now-operation of textile unit and our' focus on the revised principal business of agriculture, the Company maintained a significantly reduced workforce, none ot whom were t'emale. As a result, a gender pay gap analysis is not applicable tor the financial year under re› iew. Hoivever, the Company rernairis tiilly conimitted to tosterind an incInsive and eqnitable workplace. Equal opportunity principles will continue to guidc future recruitment and operational planning as business activities evolve.

Web Presence:

Updated infomiation can be accessed at the Company's website www.khybertextile corn. The website contains the latest financial results of the Company along with the Company's profile.

Corporate Social Responsibility:

The Management of the Company is aware and committed to its corporate and social responsibility. In this regard, the Company has invested in improved agrictilkiral practiccs, iiakiral rcsoiircc conservation and sustainable cultivation. Further, we provide spacious, clean and safe conditions for our livestock, ensuring they receive healthy nutrition from our fodder and appropriate veterinary care, The Company's focus is to promote sustainable tarming methods, while supporting the local community. This holistic approach cnhanccs our opcrations while positively contributing to thc environment and society.

Acknowledgement:

The Board would like to thank and appreciate our shareholders for their confidence and trust. The Board also extends its appreciation and grateftilness towards the dedication and commitment presented by the Company's employees.

On behalf of the Board of Directors

Dated:- 25" September, 2025

Aurangzeb Khan Director

Adam Jadoon Director/CEO

SALES

2025

Note Rupees 20,684,000

2024

Rupees 18,354,500

Less: COST OF SALES GROSS PROFIT

Less: Administrative Expenses Other Operating Expenses

Financial Expenses - Bank Charges

Fair Value Remeasurement Adjustment - Biological Assets Other Operating Income - Rent

Agriculture Income

OPERATING (LOSS)

(LOSS) BEFORE TAXATION TAXATION

17 14,709,097 13,309,532

5,974,903 5,044,668

18

20

22,209,453 17,539,250 (16,234,550) (12,494,582)

(410,781)

8,909,757 6,937,100

220,110 213,800 (7,104,683) (5,754,463)

(7,104,683) (5,754,463)

21 (1,279,495) (1,091,994)

NET (LOSS) FOR THE YEAR

EARNINGS / (LOSS) PER SHARE - BASIC AND DILUTED 22

(5,825,188)

(4.75)

(4,662,469)

(3.80)

(4)

2025J25 -:

The Company has complied with the requirements or' the Listed C'ompanies (C'ode ot Corporate Governs rice) Regulations, 2019, (Res elations) in the following manner:-

1. The toial number of direciors are 7 as per the following, -

   1. Male: 6

   2. Female: I

2. The composition ot the Board is as follows:

   1. Independent director Mr. Hassan Ovais Mr. Nusrat Iqbal iii. Non-executive directors

      Mr. Aurangzeb Khan

      Mr. Ananullah Khan Jadoon Mr. Muhammad Bahauddin Mrs. Aamna .Iadoon

   2. Female directors

   Mrs. Aamna Jadoon

   iv. Executive directors

   Mr. Adam Jadoon

3. The dircctors have confirmed that none of them is serving as a director on more than scven listcd companies, including this Company;

4. The Company has prepared a code ot' conduct and has cnsurcd that appropriate steps have been taken to disseminate it throughout the Company along with its supporting policies and procedures;

5. The Board has developed a vision/mission statement, overall corporate strategy and significant policies of the Company. The Board has ensured that complete record of particulars of the significant policies along with their date o1 approval or updating is rnaintained by the Company;

6. All the powers of the Board have been duly exercised and decisions on relevant matters have been taken by the Board/ sharcholders as empowered by the relevant provisions of the Act and these Regulations;

7. The meetings of the Board were presided over by the Chairman and, in his absence, by a director elected by the Board for this purpose. The Board has complied with the requirements of the Act and the Regulations with respect to frequency, recording and circulating minutes ot meeting of the Board;

8. Thc Board have a formal policy and transparent proccdurcs for rcrrluncration of directors in accordance with the Act and these Regulations;

9. Currently five members of the Board have completed the Directors' Training program from authorized institutions. While the two other Directors are excinpt trom Directors Training Program due to their experience on the Board;

10. The Board has approved the appointment of Chief Financial Officer (CFO), Company Secrctary and Head of Internal Audit including their remuneration and terms and conditions of employment and complied with relevant requirements of the Regulations;

11. Chief Financial Officer and Chief Executive Officer duly endorsed the financial statements bcfore approval ot'the Board;

    Khyber Textile Mills Limited 23

    
    
    

12. The Board has formed Committees comprising ot Members given below. -

    a) Audit Committee b) HR and Remuneration Committee Mr. Nusrat Iqbal (Chairman) Mr. Nusrat Iqbal (Cliaimian)

    Mr. Muhammad Bahauddin Mr. Muhammad Bahauddin

    Mrs. Aamna Jadoon Mr. Adam .Iadoon

13. The terms of' reference of' the atorcsaid committees liavc been tormcd, documented and shared with relevant Committees tor compliance;

14. The frequency of meetings of the committee were as per following, -

    1. Audit Committee; Four Quarterly Meetings during the financial year ended June 30, 2025

    2. HR and Remuneration Committee: One mccting during the financial year ended .Iunc 30, 2025

15. The Board has set up an effective internal audit function who are suitably qualified and experienced tor the purpose and are conversant with the policies and procedures ot' the Company;

16. The statutory auditors ot the company have confirmed that they have been given a satistñctory rating under the Quality Control Review program of the Institute of Chartered Accountants of Pakistan and registered with Audit Oversight Board ot Pakistan, that they and all their partners are in coiaipliance with International Federation of Accountants (IFAC) guidelines on code of ethics as adopted by the Institute of Chartered Accountants of Pakistan and that they and the partners of the finn involved in the audit are not a close relative (spouse, parent, dependent and non-dependent children) of the Chief Executive Officer, Chief Financial Officer, Head of Internal Audit, Company Secretary or Director of the C"oinpany;

17. The statutory auditors or the persons associated with them have not been appointed to provide other services except in accordance with the Act, these Regulations or any other regulatory requirement and that the auditors have confined that they have observed IFAC guidelines in this regard;

18. We confine that all other requirements of the regulations 3,6, 7, 8, 27, 32, 33 and 36 have been complied with.

30

29

INDEPENDENT AUDITOR'S REVIEW REPORT

To the members of : KHYBER TEXTILE MILLS LIMITED

Review Report on the Statement of Compliance contained in Listed Companies (Code of Corporate Governance) Regulations, 2019

We have reviewed the enclosed Statement ot' Compliance with the Listed Companies (Code or' Corporate Governance) Regulations, 2019 (the Regulations) prepared by the Board of Directors of KHYBER TEXTILE MILLS LIMITED (the Company) for the year ended June 30, 2025 in accordance with the requirements ot regulation 36 ot the Regulations.

The responsibility for compliance with the Regulations is that of' the Board of Directors of the Company. Our responsibility is to review whether the Statement of Compliance reflects the status ot' the Company's compliance with the provisions ot the Regulations and report it it does not and to highlight any non-comp1 iance with the requirements of the Regulations. A review is limited primarily to inquiries of the Company's personnel and review of various documents prepared by the Company to comply with the Regulations.

As a part of our audit of the financial statements we are required to obtain an understanding of the accounting and internal control systems sufficient to plan the audit and develop an effective audit approach. We are not required to consider whether the Board of Directors' statement on internal control covers all risks and controls or to form an opinion on the effectiveness of such internal controls, the Company's corporate governance procedures and risks.

The Regulations require the Company to place before the Audit Committee, and upon recommendation ot' the Audit Committee, place betore the Board ot' Directors tor their review and approval, its ref aieD party transactions. We are only required and have ensured compliance of this requirement to the extent of the approval of the related party transactions by the Board of Directors upon recommendation ot the Audit Committee.

Based on our review, nothing has come to our attention which causes us to believe that the Statement of Compliance does not appropriately reflect the Company's compliance, in all material respects. with the requirements contained in the Regulations as applicable to the Company for the year ended June 30, 2025.

Clarkson Hyde Saud Ansari Chartered Accountants

Engagement Partner - Saud Ansari Karachi

Dated: September 25, 2025

UDlN: CR202S I 0149BbhY K9aMe

To the members of: KHYBER TEXTILE MILLS LIMITED Report on the Audit of the Financial Statements

We have audited the annexed financial statements ot KHYBER TEXTILE MILLS LIMITED(the Coiiipany), which comprise the statement of financial position as at June 30, 2025, the stateiiient of profit or loss, the statement ot' comprehensive income. the statement o1 changes in equity, the statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory infomiation, and we state thai we have obtained all the intorination and explanations which, to the best of our knowledge and belief, were necessary for the purposes of the audit.

In our opinion and to the best of our infomiation and according to the explanations given to us, the statement ot' financial position, and the statement of profit or loss and other comprehensive income, the statement of changes in equity, and the statement ot cash flows, together with the notcs forming part thereof confomi with the accounting and reporting standards as applicable in Pakistan and give the information required by the Companies Act, 2017 (XIX of 20 17), in the manner so required and respectively give a true and fair view of the state of the Company's affairs as at June 30, 2025 of the loss and the comprehensive income, the changes in equity and its cash flows for the year then ended.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Pakistan. Our responsibilities under those standards are further described in the AuJitor '.s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the International Ethics Standards Board tor Accountants' Code of Ethics for Professional Accountants as adopted by the Institute ot Chartered Accountants of Pakistan (the Code) and we have fulfilled our ethical responsibilities in accordance with the Code. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis o f Mattet

We draw attention to Note 2.2 to the financial statcmcnts, which states that thcsc financial statcmcnts have been prepared on going concern basis, yet there were factors which had affected the Company's ability to continue as a going concern in the past. Textile operations have been suspended since .Iuly 2007. However; the Company changed its line of operations few years back and has been able to generate net cash inflows. The Company is solvent and the Management has concluded that no material uncertainty exists which cast significant doubt on the Company's ability to continue as going concern. A detailed explanation is given in the aforesaid note. Our opinion is not modified in respect of this matter.

Key Audit Matter

Key audit mattcrs arc thosc matters that. in our professional judgnicnt, wcic ot most signiticancc in our audit of the financial statements or thc current pcriod. These matters are addresscd in the context ot our audit o the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We identitied the tollowing is a key audit matter:

Information Other than the Financial Statements and Auditor's Report Tltereon

Management is responsible for the other intonration. The other inlonnation coiiiprises the intormation included in the annuaI report, but does not include the financial statements and our auditor's report thereon.

Our opinion on the financial statcincnts does not cover the other inforiiiation and we do not express any torm of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether thc other information is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstatcd. If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we arc rcquircd to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Board ot Directors tor the Financial St atements

Management is rcsponsiblc for the prcparation and fair prcscntation of the financial statements in accordance with the accounting and report'•8 standards as applicable in Pakistan and the requirements of Companies Act, 201 7 (XIX of 20 17) and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, inanageiiient is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to I iquidatc the Company or to cease operations, or has no realistic alternative but to do so.

Board of directors are responsible tor overseeing the Company's financial reporting process.

Auditor's Re.sponsibilitie.sfor the Aadit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are tree from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a his* level of assurance, but is not a suaranteethat an audit conducted in accordance with ISAs as applicable in Pakistan will always detect a material inlsstatcmcnt when it exists. Misstatements can arise trom fraud or error and are considered material it, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit iii accordance with ISAs as applicable in Pakistan, we exercise professional

judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit proccdurcs rcsponsivc to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis tor our opinion. The risk of not detecting a matcrial misstatement resulting from fraud is higher than for one resulting fron error, as fraud may involve collusion, forgery, intentional omissions, misrcprescntations, or the override of internal control.

  
  
  

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness ol accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accounting and. based on the audit evidence obtained. whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. It' we conclude that a material uncertainty exists, we are requircd to draw attention in our auditor's report to the i elatcd disclosures in thc financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions iaiay cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a iiianner that achieves tair presentation.

We communicate with the board of directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any signiticant deficiencies in the intenial control that we identify during our audit.

Wc also providc thc board of dircctors with a statcmcnt that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

from the matters communicated with the board ot directors, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences ot' doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Based on our audit, we further report that in our opinion:

1. proper books of account have been kept by the Company as required by the Companies

   Act,20l7 (XIX o1'2017);

2. the statcmcnt of financial position, thc statement of profit oi oss, the statcmcnt of comprehensive income, the statement of changes in equity and the statement of cash flows, together with notes thereon have been drawn up in conformity with the Companies Act,2017(XIX of 20l7)and are in agreement with the books of account and returns;

3. investments madc, cxpcnditurc incurred and guarantees extended during thc year were for the purpose of the Company's business; and

4. no Zakat was deductible at source under the Zakat and Usher Ordinance, 1980 (XVIII ot 1980).

The engagement partner on the audit resulting in this independent auditor's report is SAUD ANSARI

Chartered Accountants Date: September 25, 2025

UDIN: AR2023 10 l 4fiS4MrzdNpy

STATKMENT OF FIN Ah CIAL POSI TI ON AS AT IU NE 30, 2025

2025

Note Rupees

2024

Rupees

NON CURRENT ASSE"£S

Revenue Reserve Accumulated Loss

(6,560, 109) ( 10,5fi 1,588)

I ,250,951 ,034 1,25€*,S0 1,09 1

Loan from Shareholder / Director Deferred Taxation

C U RRENT LI ABILI TI ES

Short Term Loan From Director Trade and Other rayables Provision for Taxation

CONTINGENCIE S AND COMMITMENTS

1 2

13

43,726,942

14

15

ti,033,iS64

45,91 7,550

7, 1 22,87‹S

1,300,7 1 1,640 1,309,S4 1,5 1 7

The annexed notes form an integra1 part of these financiaI statements

CHIEF FINANCIAL OFFICER DIR ECTOR CHIEF EX ECUTIVE