Transmission of Quarterly Financial Statements for the Period Ended 2025-12-31

Condensed Interim Financial Statements

For the three Months Period Ended

December 31, 2025

(Un-Audited)

Sanghar Sugar Mills Limited

Table of Contents

• Company Information 2

• Directors' Review (English Version) 3-4

• Directors' Review (Urdu Version) 5-6

• Condensed Interim Statement of Financial Position 7

• Condensed Interim Statement of Profit or Loss 8

• Condensed Interim Statement of Comprehensive Income 9

• Condensed Interim Statement of Changes in Equity 10

• Condensed Interim Statement of Cash Flows 11-12

• Notes to the Condensed Interim Financial Statements 13-20

• Implementation of Section 72 of the Companies Act, 2017

  Conversion of Physical Shares Into Book-entry Form (English & Urdu) 21-24

• Dividend Payments through Electronic Mode (English & Urdu). 25-26

• Consent to receive Hard Copies of Notices and Audited

Financial Statements (English & Urdu) 27-28

Company Information

Mr. Ghulam Dastagir Rajar Non-Executive Director Mr. Ghulam Hyder Executive Director

Haji Khuda Bux Rajar Executive Director

Mr. Muhammad Qasim Non-Executive Director

Mr. Mehmood Alam Independent Director Mr. M. Abdul Jabbar(Nominee of N.I.T.) Independent Director

Ms. Misbah Non-Executive Director-Female

BOARDCOMMITTEES

AUDIT COMMITTEE

Mr. M. Abdul Jabbar (Chairman) Mr. Muhammad Qasim

Mr. Mehmood Alam

HUMAN RESOURCE & REMUNERATION COMMITTEE

Mr. M. Abdul Jabbar (Chairman) Mr. Ghulam Hyder

Ms. Misbah

INFORMATION TECHNOLOGY & STEERING COMMITTEE

Mr. Ghulam Hyder (Chairman) Syed Rehan Ahmad Hashmi

Mr. Sheraz Khan

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

Mr. Ghulam Dastagir Rajar (Chairman) Mr. Muhammad Qasim

Ms. Misbah

Syed Rehan Ahmad Hashmi

RISK MANAGEMENT COMMITTEE

Mr. Mehmood Alam (Chairman) Haji Khuda Bux Rajar

Mr. M. Abdul Jabbar

COMPANY SECRETARY

Mr. Muhammad Mubeen Alam

CHIEF FINANCIAL OFFICER

Syed Rehan Ahmad Hashmi

STATUTORY AUDITOR

Kreston Hyder Bhimji & Co. Chartered Accountants

COST AUDITOR

A. D. Akhawala & Co. Chartered Accountants

SHARE REGISTRAR

Hameed Majeed Associates (Pvt) Limited Karachi Chambers, Hasrat Mohani Road Karachi.

Phone: 021 32424826

Fax: 021 32424835

LEGAL ADVISOR

Rafiq Kalwar & Dars Law Associates, Advocates & Corporate Counselors, Office # 412, 4th Floor, Clifton Centre, DC-1, Block 5, Clifton, Karachi

BANKERS

Islamic

Al-Baraka Bank (Pakistan) Limited Bank Islami Pakistan Limited Meezan Bank Limited

Conventional

Bank Al-Habib Limited MCB Bank Limited National Bank of Pakistan Soneri Bank Limited United Bank Limited

REGISTERED / HEAD OFFICE

Office # 305, 3rd Floor, Clifton Centre, Block 5, Clifton, Karachi

Phone: 021 35371441 to 43 (3 lines)

Fax: 021 35371444

Website: https://www.sangharsugarmills.com E-mail: info@sangharsugarmills.com

MANUFACTURING FACILITIES

13 K.M., Sanghar - Sindhari Road Deh Kehore, District Sanghar, Sindh Phone: (0345) 3737001 - 8222911

DIRECTORS' REVIEW

The Board of Directors of your Company is presenting the un-audited Condensed Interim Financial Statements of the Company for the three months period ended December 31, 2025 to the members of the Company.

Operating Results

Your Company was able to crush 204,625.548 M. tons of sugarcane compared with 236,616.651 M. Tons of sugarcane in the previous crushing period producing 20,762.500 M. Tons of sugar at the recovery rate of 10.563% as compared with 22,097.500 M. Tons of sugar produced at the recovery rate of 9.749% in the previous crushing period. The Company was able to crush at an average of 5,684 M. Tons of cane per day as compared with the average of 5,771 M. Tons of cane crushed per day of the corresponding period. Despite decrease in the number of days of crushing and also declined in the average crushing per day, the recovery was increased by 0.81% as compared with the corresponding period.

Financial Results

The key financial figures of the financial results of the Company for the three months period ended December 31, 2025 along with the comparatives for the corresponding period are summarized as under:

Oct. - Dec. Oct. - Dec.

2025 2024

(Rupees '000)

Review of Financial Results

This season has been started with the expectation of surplus production and imported sugar lying in the Government's Godown. Start of season witness declining in selling price of sugar and increasing trend in the procurement price of cane, with slight increase in the recovery rate of sugar of the Company. During the period, the Company has earned profit for the period amounted to Rs. 127,380 thousand compared with profit for the period amounted to Rs. 87,931 thousand of the corresponding period. While the local sugar sales of the Company has been declined by 20.14% and simultaneously the weighted average cost of production has also been decreased by 8.24% while compared with the corresponding period, the Company earned profit for the period because the Management of your Company has tried its level best to procure the cane at the optimal rate as compared to the adjoining mills and to keep the cost of production at lowest.

Under the circumstances, the Company has made its best efforts to play its role and gives better results while comparing with the corresponding period.

Future Prospects

Due to increase in area under cultivation, your Management see an increase in crushing of sugar cane as well as increase in production of sugar for the ensuing season. Currently, the selling prices of sugar are marginally or slightly at lower side, although selling price of sugar has not been increased and the cost of production has been decreased to certain extent. The main contributing factor which may affect the final results is the availability of sugarcane at reasonable rate.

Acknowledgement

Your Directors place on record their appreciation for devotion of duty, loyalty and hard work of the executives, officers, staff members and workers for smooth running of the Company's affairs and hope that they will continue for enhancement of productivity with great zeal and spirit under the blessings of Almighty Allah.

The Directors would like to thank all the government functionaries, banking and non-banking financial institutions, suppliers and shareholders for their continued support and cooperation for the betterment and prosperity of the Company.

For and behalf of the Board of Directors

Chairman Chief Executive

Karachi: January 28, 2026

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CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION

AS AT DECEMBER 31, 2025

Un-Audited December 31

2025

Audited September 30

2025

ASSETS NON-CURRENT ASSETS

Notes (Rupees in '000)

4,957,835

4,540 4,962,375

106,549

1,668,121

128,611

136,132

5,516

19,880

63,959

437,161

2,565,929

7,528,304

200,000

119,460

556,706

2,574,197 3,250,363

1,554,243

2,723,698

- 7,528,304

1,806,055

8,375

817,475

3,731

80,450

7,612

36,376

19,713

1,498,154

Property, plant and equipment 7

Long term deposits

CURRENT ASSETS

Stores, spare parts and loose tools Stock-in-trade

Trade debts

Loans and advances

Trade deposits and short term prepayments Other receivables

Income tax refundable - net of provision Cash and bank balances

TOTAL ASSETS

EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES

Authorized capital

20,000,000 (2025: 20,000,000) shares of Rs.10 each

Issued, subscribed and paid up capital Unappropriated profit

Surplus on revaluation of property, plant and equipment

NON CURRENT LIABILITIES

Long term financing 8

Lease liabilities against right of use assets

Deferred liabilities 9

CURRENT LIABILITIES

Trade and other payables Accrued finance cost Short term borrowings Unclaimed dividend

Current portion of long term financing

Current portion of lease liabilities against right of use assets

CONTINGENCIES AND COMMITMENTS 10

TOTAL EQUITY AND LIABILITIES

The annexed notes form an integral part of these condensed interim financial statements.

5,020,685

4,540 5,025,225

90,279

493,410

127,715

79,912

1,396

17,592

77,385

107,040

994,729

6,019,954

200,000 119,460

398,391

2,605,132 3,122,983

57,712

14,530

1,495,746

1,567,988

1,174,945

4,755

63,333

3,731

77,691

4,528

1,328,983

- 6,019,954

CHIEF EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER

Karachi: January 28, 2026

CONDENSED INTERIM STATEMENT OF PROFIT OR LOSS

FOR THE THREE MONTHS PERIOD ENDED DECEMBER 31, 2025 - UNAUDITED

The annexed notes form an integral part of these condensed interim financial statements.

CHIEF EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER

Karachi: January 28, 2026

CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME

FOR THE THREE MONTHS PERIOD ENDED DECEMBER 31, 2025 - UNAUDITED

December 31

2025

December 31

2024

Profit for the period

Other comprehensive income

Total comprehensive income

(Rupees in '000)

87,931

- 87,931

The annexed notes form an integral part of these condensed interim financial statements.

CHIEF EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER

Karachi: January 28, 2026

CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY

FOR THE THREE MONTHS PERIOD ENDED DECEMBER 31, 2025 - UNAUDITED

Issued, Subscribed & Paid-up Capital

Unappropriated Profit

Surplus on revaluation of property, plant & equipment

Total

.................................... (Rupees in '000) ......................................

Balance as at October 01, 2024 - Audited 119,460 185,181 1,604,283 1,908,924

Total Comprehensive income for the period ended December 31, 2024

Income for the period

Other comprehensive income

Transfer on account of incremental depreciation charged on surplus on revaluation of property, plant and equipment - net of deferred tax

Balance as at December 31, 2024

Balance as at October 01, 2024 - Audited

Total Comprehensive income for the period ended December 31, 2025

Income for the period

Other comprehensive income

Transfer on account of incremental depreciation charged on surplus on revaluation of property, plant and equipment - net of deferred tax

Balance as at December 31, 2025

The annexed notes form an integral part of these condensed interim financial statements.

CHIEF EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER

Karachi: January 28, 2026

CONDENSED INTERIM STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS PERIOD ENDED DECEMBER 31, 2025 - UNAUDITED

December 31

2025

December 31

2024

(Rupees in '000)

The annexed notes form an integral part of these condensed interim financial statements.

CHIEF EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER

Karachi: January 28, 2026

NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS

FOR THE THREE MONTHS PERIOD ENDED DECEMBER 31, 2025 - UNAUDITED

1. THE COMPANY AND ITS OPERATIONS

   1. Sanghar Sugar Mills Limited (the Company) is a public limited Company incorporated in 1986 in Pakistan and its shares are quoted on Pakistan Stock Exchange Limited. The registered office of the Company is situated at Office No. 305, 3rd Floor, Clifton Centre, Block 5, Clifton, Karachi. The manufacturing facilities are located at Sanghar Sindhri Road, Deh Kehore, District Sanghar in the province of Sindh.

   2. The Company is principally engaged in the manufacture and sale of sugar and sale of its by-products

      i.e. molasses and bagasse. The Company has also installed bagasse fired transmission equipment to sell surplus electric power. The manufacturing facilities are located at Sanghar Sindhri Road, Deh Kehore, District Sanghar in the province of Sindh. The total area of industry land / manufacturing facilities which includes the main factory is spread over 320.625 Acres. Covered Area of Building is approximately 300,143 Sq. Feet.

2. BASIS OF PREPARATION

   1. These condensed interim financial statements of the Company for the three months period ended December 31, 2025 have been prepared in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting comprise of the following:

      • International Accounting Standard (IAS) 34 'Interim Financial Reporting issued by the International Accounting Standard Board (IASB) as notified under the Companies Act, 2017; and

      • Provisions of and directives issued under the Companies Act 2017.

        Where the provisions of and directives issued under the Companies Act 2017 differ with the requirements of IAS 34, the provisions of and directives issued under the Companies Act 2017 have been followed.

   2. These condensed interim financial statements comprise of the condensed interim statement of financial position as at December 31, 2025 and condensed interim statement of profit or loss, condensed interim statement of comprehensive income, condensed interim statement of changes in equity, condensed interim statement of cash flows and notes thereto for the three months period then ended.

   3. These condensed interim financial statements for the three months period ended December 31, 2025 are being submitted to shareholders as required under Section 237 of Companies Act, 2017. These condensed interim financial statements do not include all the information and disclosure as required in the annual financial statements and should be read in conjunction with the Company's annual financial statements for the year ended September 30, 2025.

3. MATERIAL ACCOUNTING POLICY INFORMATION

   The accounting policies, related judgments, estimates and assumptions adopted for the preparation of these condensed interim financial statements are the same as those applied in preparation of the annual financial statements of the Company for the year ended September 30, 2025.

4. SEASONAL PRODUCTION

   Due to seasonal availability of sugarcane, the manufacturing of sugar is carried out during the period of availability of sugarcane and only costs incurred / accrued up to the reporting date have been accounted for. Accordingly, the cost incurred / accrued after the reporting date will be reported in the subsequent financial statements.

5. RECENT ACCOUNTING DEVELOPMENTS

   1. New Standards, amendments to approved accounting standards and new interpretations which became effective during the three months period ended December 31, 2025:

      There are certain amendments to the new accounting standards that are effective and mandatory to the Company's accounting period beginning on October 01, 2025, but are considered either not to be relevant or do not have any significant effect on the Company's operations and are therefore, not disclosed in these condensed interim financial statements.

   2. New Standards, amendments to approved accounting standards and new interpretations that are not yet effective during the three months period ended December 31, 2025:

      There are certain amendments to the new accounting standards that are mandatory and not yet effective to the Company's accounting period beginning on October 01, 2025, but are considered either not to be relevant or do not have any significant effect on the Company's operations and are, therefore, not disclosed in these condensed interim financial statements.

6. PROVISIONS

   Provisions in respect of current taxation, deferred taxation, workers' profit participation fund and workers' welfare fund, if any, are based on three months results and final liabilities will be determined on the basis of annual results.

   Un-Audited December 31

   2025

   Audited September 30

   2025

7. PROPERTY, PLANT AND EQUIPMENT

   Operating fixed assets Note 7.1

   Capital work in progress Note 7.2

   Right of use assets Note 7.3

   (Rupees in '000)

   4,939,961

   - 17,874

   4,957,835

   5,001,870

   - 18,815

   5,020,685

   Un-Audited December 31

   2025

   Un-Audited December 31

   2,850

   64,759

   -

   941

   2024

   1. Operating Fixed Assets

      Additions during the period

      Vehicles

      Depreciation

      (Rupees in '000)

      4,514

      Depreciation charged during the period

   2. Capital Work in Progress

      Addition in Capital work in progress

      Plant and Machinery

   3. Right of use assets

      Depreciation

      Depreciation charged during the period

      43,424

      10,332

      -

      Un-Audited December 31

      2025

      Audited September 30

      2025

8. LONG TERM FINANCE

   Secured

   Under profit arrangements

   from Shahria compliant financial institution

   (Rupees in '000)

   other than banks Diminishing Musharakah - I	Note 8.1	47,869	57,823
   Diminishing Musharakah - II	Note 8.2	64,051	72,315
   Diminishing Musharkah - III	Note 8.3	4,906	5,265
   		116,826	135,403
   Current portion shown under current liabilities		(80,450)	(77,691)
   		36,376	57,712

   1. This represents Diminishing Musharakah arrangement from shariah compliant financial institution under profit arrangements and repayable in three years in monthly installments with a profit payments @ 6 months KIBOR + 4.50%. This loan is secured against the title over specific machinery.

   2. This represents Diminishing Musharakah arrangement from shariah compliant financial institution under profit arrangements and repayable in two years in monthly installments after the grace period of one year with a profit payments @ 6 months KIBOR + 4.50%. This loan is secured against the title over specific machinery.

   3. This represents Diminishing Musharakah arrangement from shariah compliant financial institution under profit arrangements and repayable in three years in monthly installments with a profit payments @ 12 months KIBOR + 3.51 %. This loan is secured against the title over specific Vehicle.

   4. Certain loan facilities of the Company require compliance with loan covenants (common being current ratio, gearing ratio, and debt service coverage ratio) during the respective tenures of the facilities. Breach of covenants may require the Company to repay the loan earlier than agreed upon repayment dates in case upon intimation of the lender the default is not rectified. The Company monitors the compliance with covenants on a regular basis. There are no indications that the Company would have difficulties complying with these covenants.

Un-Audited December 31

2025

Audited September 30

2025

(Rupees in '000)

1. CONTINGENCIES AND COMMITMENTS

   1. Contingencies:

      1. There is no material change in the status of contingencies as disclosed in note. 22.1 and other respective notes of the annual financial statements for the year ended September 30, 2025 except that;

         - The amount of the aggregate provision of the market committee fee as stated in note 9 of these condensed interim financial statements, has increased from Rs. 99,907 thousand to Rs. 101,953 thousand due to provision in respect of the current crushing season amounting to Rs. 2,046 thousand. Same case is reported in note 18.2.1 of annual financial statements for the year ended September 30, 2025.

      2. The Government of Sindh issued a notification no. 8(142)/ S.O(EXT)2017, according to which, the minimum price of sugarcane has been fixed at the rate of Rs. 182 per 40 kg for the crushing season 2017-2018. The Company along with other Sugar mills has filed a Constitutional Petition No 8666 of 2017 in the Honourable High Court of Sindh dated 19 December 2017 against the said notification. Thereafter, the Honourable Court after deliberations with all stakeholders announced the judgment fixing the purchase price at Rs. 160 to be paid to growers and the balance of Rs. 22 per 40 kg to be decided by the Honourable Supreme Court of Pakistan which is pending. The differential amount aggregating to Rs. 391,668 thousand has not been accounted for since the purchase price has been agreed with the parties and outcome of the Honourable Supreme Court is not likely to be against the Company. Furthermore, the Company along with other sugar mills have also filed petition in the Honourable Supreme Court challenging the minimum price fixation mechanism, which is also pending before the Honourable Court.

   2. Guarantee:

      1. The Company has available bank guarantee facility for an amount of Rs. 75,000 thousand which is secured against 25% and rest is against the existing charge over current and fixed assets of the Company, already held as collateral. However, as at year-end no bank guarantee is unsecured on behalf of the Company.

      2. The Company has provided counter guarantee to MCB Bank Limited, amounting to Rs. 75,000 thousand (2025: Rs. 75,000 thousand) against grower finance facility to the growers supplying sugarcane to the mills. The aggregate financing facility obtained amounted to Rs. 75,000 thousand (2025: Rs. 75,000 thousand) directly disbursable to the growers' bank account and the Company recovers the amount of finance from adjustments in cane procurement payments and or recovered through re-payment to the Company by the respective growers along with markup thereon. This is secured by hypothecation over current assets of the Company, exclusive & pari passu hypothecation charge on Company's plant & machinery and 1st equitable mortgage charge over fixed assets of the Company. The financing facility is collaterally secured by the personal guarantees of all the sponsor directors. The facility carries markup at 3 months KIBOR as base rate plus 1% (2025: 3 months KIBOR as base rate plus 1%) chargeable and payable quarterly, which is also recovered from the growers. The facility is renewable annually at the time of maturity.

   3. Commitments:

1. Commitments against capital expenditure as at the period end aggregated to Rs. 2,100 thousand (2025: Rs. 2,100 thousand).

2. As disclosed in note 22.3.2 of annual financial statements of the Company for the year ended September 30, 2025, the Company committed to donate 05 acre of its land to Workers Welfare Fund, Government of Pakistan for establishing 50 bed hospital in the vicinity of Sanghar. However, the matter is pending since long and the Company see no further progress, in this project.

Three Months Period Ended

Un-Audited December 31

2025

Un-Audited December 31

2024

(Rupees in '000)

(

12.1 The closing stock of sugar having carrying value of Rs. 643,941 thousand (2024: Rs. 699,341 thousand) has been pledged against financing obtained from Conventional Bank.

Three Months Period Ended

Un-Audited December 31

2025

Un-Audited December 31

2024

(Rupees in '000)

1. CASH AND CASH EQUIVALENTS

   Cash and cash equivalents comprise of the following items;
   Cash and bank balances	437,161	831,100
   Short term borrowings - running finance	(100,000)	(100,000)
   	337,161	(731,100)

2. RELATIONSHIP WITH THE ISLAMIC AND CONVENTIONAL FINANCIAL INSTITUTION

   The Company in the normal course of business deals with pure Islamic financial institution as well as the financial institution who have both the conventional and Islamic window operations. The detail of the segregation relevant assets / liabilities and expenditures between Islamic Mode and Conventional Mode are as under:

   Un-Audited Audited December 31 September 30

   2025 2025

   From Condensed Interim Statement of Financial Position Mode (Rupees in '000)

   Lease liabilities	Conventional	27,325	19,058
   Long term finance	Islamic	116,826	135,403
   Short term borrowings	Islamic	-	63,333
   Short term borrowings	Conventional	817,475	-
   Accrued finance cost	Islamic	-	363
   Accrued finance cost	Conventional	8,375	4,392
   Bank balances	Islamic	61,592	15,197
   Bank balances	Conventional	383,439	99,713

   From Condensed Interim Statement of Profit or Loss Mode

   Un-Audited Un-Audited December 31 December 31

   2025 2024

   (Rupees in '000)

   Net revenue earned from Shariah Compliant business	Islamic	1,362,995	2,398,286
   Finance cost	Conventional	7,481	21,296
   Finance cost	Islamic	6,091	9,089
   Other Income V. Filter Cake Sales	Islamic	600	77
   Gain on sale of property, plant and equipment	Islamic	-	300
   Rent and related receipts	Islamic	6	45

   The Company has relationship with Sindh Modaraba, OLP Modaraba, OLP Financial Services Limited - Islamic Finance, Faysal Bank Limited, Meezan Bank Limited, Adamjee Insurance Company Limited - Window Takaful Operations, Bank Islami Pakistan Limited, Albarakah Bank Pakistan Limited.

3. RELATED PARTY TRANSACTIONS

   The details of the transactions with related parties carried out during the period is as detailed below:

   1. Name of Related Party Relationship with

      Company

      Nature of Transaction

      Un-Audited Un-Audited December 31 December 31

      2025 2024

      ( Rupees in '000 )

      Mr. Gul Mohammad Rajar ……… Do ………	Brother of Chief Executive ……… Do ………	Cane purchased Advance against cane purchase (Paid / Adjusted)	611	579
      			100	157
      Mr. Faisal Rehman Rajar ……… Do ………	Brother of Chief Executive ……… Do ………	Cane purchased Advance against cane purchase (Paid / Adjusted)	1,416	1,456
      			166	106
      Haji Khuda Bux Rajar ……… Do ………	Director & Father of Chief Executive ……… Do ………	Cane purchased Advance against cane purchase (Paid / Adjusted)	8,414	-
      			375	-
      Mr. Abdul Hakeem Rajar ……… Do ………	Son of Chairman ……… Do ………	Cane purchased Advance against cane purchase (Paid / Adjusted)	28,543	15,167
      			19,620	10,832
      Mr. Ghulam Dastagir Rajar ……… Do ………	Chairman ……… Do ………	Cane purchased Advance against cane purchase (Paid / Adjusted)	18,586	-
      			8,840	-
      Mr. Ghulam Hyder	Chief Executive	Rentals Paid	900	-

      Number of Directors & Relationship with December 31 December 31 Executives Company Nature of Transaction 2025 2024 ( Rupees in '000 )
      One	Chief Executive	Salaries & Benefits	5,166	4,199
      One	Executive Director	Salaries & Benefits	4,178	3,947
      Three	Company Secretary, Chief Financial Officer	Salaries & Benefits	4,108	3,989
      Four	& General Manager on-Executive Director	Meetings Fee	210	210

      Un-Audited Un-Audited

   1. Key Management Personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity directly or indirectly.

4. FINANCIAL RISK MANAGEMENT / FAIR VALUES / MEASUREMENT

   These condensed interim financial statements do not include all financial risk management information and disclosures which are required in the annual financial statements and should be read in conjunction with the Company's annual financial statements for the year ended September 30, 2025. There have been no significant changes in any risk management policies since the year end.

   Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e. an exit price) regardless of whether that price is directly observable or estimated using another valuation technique.

   A number of the Company's accounting policies and disclosure require the measurement of fair values, for both financial, if any and non-financial assets and liabilities. When measuring the fair value of an asset or a liability, the Company uses valuation techniques that are appropriate in the circumstances and uses observable market data as far as possible. Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

   • Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

   • Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

   • Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

   Financial assets and liabilities of the Company are either short term in nature or are reprised periodically therefore; their carrying amounts approximate their fair values.

5. DATE OF AUTHORIZATION FOR ISSUE

   These condensed interim financial statements was authorized for issue by the Board of Directors of the Company in their meeting held on January 28, 2026.

6. GENERAL

   1. Figures have been rounded off to nearest thousand of rupees.

      CHIEF EXECUTIVE DIRECTOR CHIEF FINANCIAL OFFICER

      Karachi: January 28, 2026

      Sanghar Sugar Mills Limited

      IMPLEMENTATION OF SECTION 72 OF THE COMPANIES ACT, 2017 CONVERSION OF PHYSICAL SHARES INTO BOOK-ENTRY FORM

      Section 72 of the Companies Act, 2017 (the "Act") requires every company having share capital to have its shares in book- entry form only, from the date notified by the Securities & Exchange Commission of Pakistan (the Commission). Further, every existing company is required to replace its physical shares with book-entry form. A period of four years is specified in the Act for implementation of this provision and the deadline was ended on May 30, 2021. Section 72 is reproduced below for ready reference:

      "72. Issuance of shares in book-entry form.(1) After the commencement of this Act from a date notified by the Commission, a company having share capital, shall have shares in book-entry form only.

      1. Every existing company shall be required to replace its physical shares with book-entry form in a manner as may be specified and from the date notified by the Commission, within a period not exceeding four years from the commencement of this Act:

         Provided that the Commission may notify different dates for different classes of companies:

         Provided further that the Commission may, if it deems appropriate, extend the period for another two years besides the period stated herein.

      2. Nothing contained in this section shall apply to the shares of such companies or class of companies as may be notified by the Commission."

Furthermore, Regulation 44 of the Companies Regulations, 2024 states as under:-

"Issuance of shares in book-entry form. Subsequent to the notification under section 72 of the Act, all companies required to replace its physical shares with book-entry form shall apply to a Central Depository in terms of the relevant Regulations for declaration of company's shares as eligible securities and comply with the requirements of the Central Depository for issuance of shares in book entry form."

In view of the above-mentioned requirements of the Act and as a step further towards digitization, the Securities and Exchange Commission of Pakistan (SECP) is considering

to make it obligatory for all public listed, public unlisted, public interest and private limited companies to have their shares in book-entry form in compliance with Section 72 of the Companies Act, 2017. Shares held in book-entry form shall have the same rights and privileges as shares held in physical certificate form. However, rights and privileges of shares held in physical form may be restricted at a future date due to non-compliance with the provision of section 72 of the Companies Act, 2017. Once notified, all companies required to replace their physical shares with book-entry form shall apply to a central depository licensed by the SECP for conversion of existing physical shares and further issuance of shares in the book entry form. The central depository shall prescribe procedures for such conversion and issuance of shares including documentation required, process to be followed and applicable fee and charges. Further, the conversion of shares into book-entry form will make the process of share handling more efficient, risk free and would help to minimize shareholding disputes. Handling of shares in case of corporate actions i.e. issue of bonus/right shares and transfer or selling of shares would be much easier, if shares are converted into book-entry form. Book entry securities can be pledged to a bank to obtain financing against them. Furthermore, it would help to reduce the risks and costs associated with storing of physical share certificates, which are susceptible to be lost, stolen and /or damaged and conversion of shares would help to avoid such problems.

Therefore, it is requested to all the Shareholders (who have shares in physical form) of Sanghar Sugar Mills Limited to convert their physical shares in to book-entry form on immediate basis.

Sanghar Sugar Mills Limited Dividend Payments through Electronic Mode

In accordance with the provisions and under section 242 of the Companies Act, 2017, shareholders are entitled to receive their dividends by way of direct credit to their bank account. Therefore, to receive your dividends directly in your bank account, please give us following complete details and inform us in writing duly signed along with a copy of your CNIC / NTN to the Share Registrar or the Company and in case Shares held in CDC then please inform concerned Participant / CDC investor Account Services.

SHARE HOLDER'S SECTION

The Company Secretary, The Share Registrar,

Sanghar Sugar Mills Limited, Hameed Majeed Associates (Pvt) Limited

Office No. 305, 3rd Floor, Clifton Centre, Karachi Chambers, Hasrat Mohani Road,

Block 5, Clifton, Karachi. Karachi

Phone: 021 35371441 to 43 (3 lines) Phone: 021 32424826

Fax: 021 35371444 Fax: 021 32424835

I hereby wish to communicate my desire to receive my future dividends directly in my bank account as detailed below:

It is stated that the above particulars given by me are correct to the best of my knowledge and I shall keep the Company informed in case of any changes in the said particulars in future.

Shareholder's Signature

CNIC / NTN No.

(Copy attached)

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Sanghar Sugar Mills Limited Consent to receive Hard Copies of Notices and Audited Financial Statements

In supersession / partial modification of notification No. 470(I) dated May 31, 2016 and notification No. 787(I)/2014 dated September 08, 2014, the SECP has issued latest S.R.O. 389(I)/2023 dated March 21, 2023 read with Section 223(6) and 223 (7) of the Companies Act, 2017 which states that the Members of the Company who wish to receive the hard copy of Audited Financial Statements and Reports of the Company instead of sending the same through email, are requested to provide a "Standard Request Form", duly filled and signed in all respects, to communicate the need of hard copy, to the Company Secretary / Share Registrar. Therefore, to receive Hard Copies of current and future notices and audited financial statements, please give us following complete details and inform us in writing duly signed along with a copy of your CNIC / NTN to the Company.

SHARE HOLDER'S SECTION

SHARE HOLDER'S SECTION

The Company Secretary, The Share Registrar,

Sanghar Sugar Mills Limited, Hameed Majeed Associates (Pvt) Limited

Office No. 305, 3rd Floor, Clifton Centre, Karachi Chambers, Hasrat Mohani Road,

Block 5, Clifton, Karachi. Karachi

Phone: 021 35371441 to 43 (3 lines) Phone: 021 32424826

Fax: 021 35371444 Fax: 021 32424835

I hereby wish to communicate my desire to receive notices and audited financial statements through mail as detailed below:

Name of shareholder :

Folio number/CDC Account No. :

Contact number of shareholder :

Contact Address of shareholder :

CNIC No. :

NTN (in case of corporate entity) :

It is stated that the above particulars given by me are correct to the best of my knowledge and I would like to opt the option of receiving the hard copies of notices and audited financial statements of the Company and I shall keep the Company informed in case of any changes in the said particulars in future.

Shareholder's Signature & date (Affix stamp for corporate entity)

CNIC / NTN No.

(Copy attached)

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REGISTERED / HEAD OFFICE:

Office # 305, 3rd Floor, Clifton Centre, Block 5, Clifton, Karachi, Pakistan.

021 35371441 to 43 (3 lines)

021 35371444

MANUFACTURING FACILITIES

13 K.M., Sanghar - Sindhari Road Deh Kehore, District Sanghar, Sindh

(0345) 3737001 - 8222911

info@sangharsugarmills.com https://www.sangharsugarmills.com