Singer (sri Lanka) PlcCSELK: SINS.N0000

Interim Financial Statements as at 30/06/2024

· Issued by Singer (sri Lanka) Plc

S I N G E R ( S R I L A N K A ) P L C

INTERIM FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED 30TH JUNE 2024

Interim Financial Statements For the Three Months ended 30th June 2024

Statement of Profit or Loss and Other Comprehensive Income

Group

Company

For the Three Months ended 30th June

2024

2023

Change

2024

2023

Change

Rs. '000

Rs. '000

%

Rs. '000

Rs. '000

%

Revenue

19,123,797

12,994,985

47%

17,234,163

11,329,162

52%

Cost of Sales

(11,927,213)

(8,480,768)

-41%

(11,951,556)

(8,350,117)

-43%

Direct Interest Cost

(1,011,579)

(1,235,116)

18%

-

-

Gross Profit

6,185,005

3,279,101

89%

5,282,607

2,979,045

77%

Other Income

86,270

48,158

79%

36,261

17,406

108%

Selling and Administrative Expenses

(4,570,095)

(3,234,598)

-41%

(3,809,666)

(2,705,615)

-41%

Impairment Loss on Trade and Other Receivables

(175,300)

(188,517)

7%

(131,692)

(110,132)

-20%

Operating Profit

1,525,880

(95,856)

1,692%

1,377,510

180,704

662%

Finance Cost

(881,903)

(1,402,612)

37%

(880,377)

(1,368,926)

36%

Finance Income

361,195

491,756

-27%

207,291

126,155

64%

Net Finance Cost

(520,708)

(910,856)

43%

(673,086)

(1,242,771)

46%

Value Added Tax on Financial Services

(112,770)

(71,973)

-57%

(20,000)

(14,000)

-43%

Profit/(Loss) Before Tax

892,402

(1,078,685)

183%

684,424

(1,076,067)

164%

Income Tax Expense

(305,802)

174,173

-276%

(212,410)

191,516

-211%

Profit/(Loss) for the Period

586,600

(904,512)

165%

472,014

(884,551)

153%

Total Comprehensive Income for the Period, Net of Tax

586,600

(904,512)

472,014

(884,551)

Profit / (Loss) Attributable to -

Owners of the Company

567,682

(893,798)

472,014

(884,551)

Non - Controlling Interests

18,918

(10,714)

-

-

Profit / (Loss) for the Period

586,600

(904,512)

472,014

(884,551)

Total Comprehensive Income Attributable to -

Owners of the Company

567,682

(893,798)

472,014

(884,551)

Non - Controlling Interests

18,918

(10,714)

-

-

Total Comprehensive Income for the Period Net of Tax

586,600

(904,512)

472,014

(884,551)

Basic / Diluted Earnings Per Share (Rs.)

0.49

(0.79)

0.40

(0.78)

Above figures are provisional and subject to audit.

Share Prices

For the three Months ended

For the three Months ended

30th June 2024

30th June 2023

Rs.

Rs.

Highest

20.30

15.80

Lowest

15.90

10.90

Last Traded Price

16.10

14.20

2 SINGER (SRI LANKA) PLC

Interim Financial Statements For the Three Months ended 30th June 2024

Statement of Financial Position

Group

Company

As at

30th June

30th June

31st March

30th June

30th June

31st March

2024

2023

2024

2024

2023

2024

Rs.'000

Rs.'000

Rs.'000

Rs.'000

Rs.'000

Rs.'000

ASSETS

Non-Current Assets

Property, Plant and Equipment

8,070,310

7,631,127

8,142,751

7,050,771

3,844,797

7,138,161

Right -of- Use Assets

4,927,538

4,230,152

4,819,975

4,215,295

3,550,699

4,071,277

Intangible Assets

493,806

510,842

504,399

400,230

402,586

406,818

Investment in Subsidiaries

-

-

-

1,760,085

2,963,023

1,760,085

Other Investments

22,326

23,645

22,326

20,141

21,524

20,141

Trade and Other Receivables

12,170,049

7,327,402

10,690,226

755,556

738,654

822,170

Deferred Tax Assets

647,195

1,000,797

634,255

613,823

1,562,598

613,823

26,331,224

20,723,965

24,813,932

14,815,901

13,083,881

14,832,475

Current Assets

Inventories

18,724,730

18,251,275

21,600,921

18,363,438

16,292,744

21,207,435

Loans due from Related Parties

-

-

-

-

268,000

-

Income Tax Receivables

168,423

518,823

324,833

168,424

480,659

324,833

Trade and Other Receivables

40,422,052

27,215,758

37,846,591

19,588,314

11,250,531

19,638,963

Amounts Due from Related Parties

7,936

4,902

46,021

179,714

56,088

87,344

Financial Assets at FVTPL

455,732

-

463,761

-

-

-

Deposits with Banks

810,108

361,659

702,898

551,075

-

448,875

Short term Investments

2,555,760

2,159,425

2,478,591

-

-

-

Cash and Cash Equivalents

3,414,353

7,838,387

5,488,327

2,923,532

2,486,284

1,658,031

66,559,094

56,350,229

68,951,943

41,774,497

30,834,306

43,365,481

Total Assets

92,890,318

77,074,194

93,765,875

56,590,398

43,918,187

58,197,960

EQUITY AND LIABILITIES

Equity

Stated Capital

1,138,857

626,048

1,138,857

1,138,857

626,048

1,138,857

Other Components of Equity

3,274,589

1,594,059

3,328,109

2,947,581

1,198,640

2,948,946

Revenue Reserves

7,376,329

7,029,175

6,930,271

4,534,978

3,938,276

4,236,740

Total Equity Attributable to Owners of the

Company

11,789,775

9,249,282

11,397,237

8,621,416

5,762,964

8,324,543

Non-Controlling Interest

1,065,428

1,936,190

1,046,509

-

-

-

Total Equity

12,855,203

11,185,472

12,443,746

8,621,416

5,762,964

8,324,543

Non-Current Liabilities

Interest - Bearing Loans and Borrowings

7,181,667

10,386,433

8,405,000

5,250,000

9,050,000

6,200,000

Lease Liability

4,631,910

4,039,127

4,524,408

3,926,256

3,389,495

3,770,974

Employee Benefit Obligations

1,261,062

1,079,192

1,229,148

1,085,350

745,302

1,058,874

Security Deposits

1,649,439

1,474,207

1,560,728

1,649,439

1,474,207

1,560,728

Other Financial Liabilities

4,583,527

3,709,117

3,252,235

-

-

Deferred Revenue

82,448

67,739

77,468

82,448

67,739

77,468

Other Non - Current Liabilities

178,937

193,553

175,427

178,937

193,553

175,427

19,568,990

20,949,368

19,224,414

12,172,430

14,920,296

12,843,471

Current Liabilities

Trade and Other Payables

12,753,474

7,697,505

12,170,613

11,749,407

6,711,862

11,115,151

Deferred Revenue

404,520

223,949

359,490

404,470

223,893

359,440

Dividends Payable

77,847

64,105

59,729

71,373

49,146

49,083

Amounts Due to Related Parties

1,135,216

563,603

1,527,754

1,699,180

962,388

2,144,825

Income Tax Payable

161,376

312,030

108,185

-

-

-

Other Financial Liabilities

18,575,292

17,394,556

18,927,276

-

-

-

Lease Liability

1,088,439

1,053,279

1,084,239

978,970

935,209

974,538

Interest - Bearing Loans and Borrowings

23,609,566

16,326,346

25,312,181

19,039,441

13,366,964

20,377,748

Bank Overdrafts

2,660,395

1,303,981

2,548,247

1,853,711

985,465

2,009,161

60,466,125

44,939,354

62,097,715

35,796,552

23,234,927

37,029,946

Total Liabilities

80,035,115

65,888,722

81,322,129

47,968,982

38,155,223

49,873,417

Total Equity and Liabilities

92,890,318

77,074,194

93,765,875

56,590,398

43,918,187

58,197,960

Net Assets per Share (Rs.)

10.10

8.21

9.76

7.38

5.11

7.13

I certify that the above Financial Statements comply with the requirments of the Companies Act No.07 of 2007.

(Sgd.)

Shalinka Seresinhe

Finance Director

Above figures are provisional and subject to audit.

The Board of Directors is responsible for the preparation and presentation of these Financial Statements.

Signed for and on behalf of the Board by,

(Sgd.)

(Sgd.)

A.M. Pandithage

Mahesh Wijewardene

Chairman

Director/Group Chief Executive Officer

Colombo,

08th August 2024

SINGER (SRI LANKA) PLC

3

Interim Financial Statements For the Three Months ended 30th June 2024

Statement of Changes in Equity

For the Three Months ended 30th June

Group

Attributable to equity holders of the Company

Non-

Total

Stated

Other Components of Equity

Revenue Reserves

Total

Capital

Controlling

Equity

Statutory

Regulatory

Revaluation

Fair Value

General

Retained

Interest

Reserve

Allowance

Reserves

of Financial

Reserves

Earnings

Recerve

Assets

at FVOCI

Reserve

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Balance as at 31st March 2023

626,048

244,215

1,350,892

5,165

2,700,000

5,216,760

10,143,080

1,946,904

12,089,984

Realisation of Revaluation Surplus

-

-

(6,213)

-

-

6,213

-

-

-

Loss for the period

-

-

-

-

-

(893,798)

(893,798)

(10,714)

(904,512)

Total comprehensive income for the period

-

-

(6,213)

-

-

(887,585)

(893,798)

(10,714)

(904,512)

Transactions with Owners of the Company,

Recognised Directly in Equity

-

-

-

-

Final Dividend

-

-

-

-

-

-

Balance at 30th June 2023

626,048

244,215

1,344,679

5,165

2,700,000

4,329,175

9,249,282

1,936,190

11,185,472

Realisation on Revaluation Surplus

-

-

(22,018)

-

-

22,018

-

-

-

Transferred to/(from) during the period

-

81,079

51,093

-

-

-

(132,172)

-

-

-

-

-

Profit for the Period

733,985

733,985

79,227

813,212

Other Comprehensive Income

-

-

Revaluation Gain on Land and Buildings

724,044

724,044

724,044

Actuarial Loss on Employee Benefit Obligations

-

-

-

-

(60,443)

(60,443)

3,488

(56,955)

Fair Value Change in Equity instruments

designated at fair value through other

comprehensive income

-

-

-

(1,332)

-

-

(1,332)

13

(1,319)

-

-

Related Taxes

-

-

Deferred Tax on Revaluation Gain on Land

and Buildings

(217,179)

(217,179)

(217,179)

Deferred Tax on Actuarial loss on Employee

Benefit Obligations

-

-

-

-

-

18,133

18,133

(1,047)

17,086

Deferred Tax on Equity Investments at

FVOCI-change in fair value

-

-

-

415

-

-

415

-

415

Total Other Comprehensive Income for the

Period

-

-

506,864

(917)

-

(42,310)

463,637

2,455

466,092

Total Comprehensive Income for the

Period

-

-

506,864

(917)

-

691,675

1,197,622

81,682

1,279,304

Transactions with Owners of the Company,

Recognised Directly in Equity

-

-

Distributions to Owners of the Company

-

-

-

-

-

-

-

-

-

Final Dividend - 2022/2023

-

-

-

-

-

-

-

(32,449)

(32,449)

Total Distributions to Owners of the Company

-

-

-

-

-

-

-

(32,449)

(32,449)

New Share issue to Minority Shareholders of

the Amalgamated Companies

512,809

512,809

512,809

Recognition of Amalgamation Reserve through

the Equity

1,116,888

(679,366)

437,522

(938,913)

(501,391)

Total Transactions with Owners of the

Company, Recognised Directly in Equity

512,809

1,116,888

(679,366)

950,331

(971,362)

(21,031)

Balance at 31st March 2024

1,138,857

325,294

51,093

2,946,413

4,248

2,700,000

4,231,330

11,397,237

1,046,509

12,443,746

-

-

Realisation of Revaluation Surplus

-

-

(1,366)

-

-

1,366

-

-

-

Transferred to/(from) during the period

(51,093)

51,093

-

-

Profit for the period

-

-

-

-

-

567,682

567,682

18,918

586,600

Total comprehensive income for the period

-

-

(51,093)

(1,366)

-

-

620,141

567,682

18,918

586,600

Interim Dividend -2024/25

-

-

-

-

-

-

(175,143)

(175,143)

-

(175,143)

Total Distributions to Owners of the Company

-

-

-

-

-

-

(175,143)

(175,143)

-

(175,143)

Balance at 30th June 2024

1,138,857

325,294

-

2,945,047

4,248

2,700,000

4,676,328

11,789,775

1,065,428

12,855,203

4 SINGER (SRI LANKA) PLC

Interim Financial Statements For the Three Months ended 30th June 2024

Statement of Changes in Equity

For the Three Months ended 30th June

Stated

Other Components of

Company

Capital

Equity

Revenue Reserves

Total

Equity

Revaluation

Fair Value

General

Retained

Reserves

of Financial

Reserves

Earnings

Assets

at FVOCI

Reserve

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Rs.000

Balance as at 31st March 2023

626,048

1,199,234

3,503

2,700,000

2,118,730

6,647,515

Realisation of Revaluation Surplus

-

(4,097)

-

-

4,097

-

Loss for the period

-

-

-

-

(884,551)

(884,551)

Total comprehensive income for the period

-

(4,097)

-

-

(880,454)

(884,551)

-

Balance at 30th June 2023

626,048

1,195,137

3,503

2,700,000

1,238,276

5,762,964

-

Realisation on Revaluation Surplus

-

(12,291)

-

-

12,291

-

Profit for the Period

586,850

586,850

-

Other Comprehensive Income

-

Revaluation gain on Land & Building

724,044

724,044

Actuarial Loss on Employee Benefit Obligations

-

-

-

-

(66,535)

(66,535)

Fair Value Change in Equity instruments designated at fair value through

other comprehensive income

-

-

(1,384)

-

-

(1,384)

-

Related Taxes

-

Deferred Tax on Revaluation Gain on Land & Buildings

(217,179)

(217,179)

Deferred Tax on Actuarial loss on Employee Benefit Obligations

-

-

-

-

19,961

19,961

Deferred Tax on Equity Investments at FVOCI-change in fair value

-

-

415

-

-

415

Total Other Comprehensive Income for the Period

-

506,865

(969)

-

(46,574)

459,322

Total Comprehensive Income for the Period

-

506,865

(969)

-

540,276

1,046,172

Transactions with Owners of the Company, Recognised Directly in

Equity

New Share issue to Minority Shareholders of the Amalgamated Companies

512,809

512,809

Recognition of Amalgamation Reserve through the Equity

1,256,702

(254,102)

1,002,600

Total Transactions with Owners of the Company, Recognised Directly

in Equity

512,809

1,256,702

(254,102)

1,515,408

Balance at 31st March 2024

1,138,857

2,946,413

2,534

2,700,000

1,536,741

8,324,543

Realisation of Revaluation Surplus

-

(1,366)

-

-

1,366

-

Profit for the period

-

-

-

-

472,014

472,014

Total comprehensive income for the period

-

(1,366)

-

-

473,268

472,014

Transactions with Owners of the Company, Recognised Directly in Equity

Distributions to Owners of the Company

Interim Dividend - 2024/2025

-

-

(175,143)

(175,143)

Total Distributions to Owners of the Company

(175,143)

(175,143)

Balance at 30th June 2024

1,138,857

2,945,047

2,534

2,700,000

1,834,978

8,621,416

SINGER (SRI LANKA) PLC

5

Interim Financial Statements For the Three Months ended 30th June 2024

STATEMENT OF CASH FLOWS

Group

Company

For the Three Months ended 30th June

2024

2023

2024

2023

Rs.'000

Rs.'000

Rs.'000

Rs.'000

Cash Flows from/(used in) Operating Activities

Net Profit/(Loss) before Income Tax Expense

892,402

(1,078,685)

684,424

(1,076,067)

Adjustments for:

-

Depreciation on Property, Plant and Equipment

181,226

199,533

139,891

140,071

Amortization of Intangible Assets

14,620

13,813

10,616

9,577

Amortization of Right of Use Assets

291,400

251,666

254,945

217,086

Loss/ ( Gain) on Disposal of Property, Plant and Equipment

(8,017)

399

(7,821)

399

Interest Expenses

907,749

1,428,559

880,377

1,368,926

Interest Income

(157,531)

(400,802)

(17,691)

(63,605)

Impairment/(Reversal) of Inventories

(5,762)

144,374

(5,762)

36,484

Impairment on Trade and Other Receivables

175,300

188,517

131,692

109,426

Provision for Retiring Gratuity

52,550

34,254

44,870

22,499

Operating Profit before Working Capital Changes

2,343,937

781,628

2,115,541

764,796

Decrease in Inventories

2,881,951

1,831,689

2,849,763

1,599,698

(Increase)/Decrease in Debtors falling Due after one Year

(1,655,124)

257,856

(65,078)

(110,399)

(Increase)/Decrease in Debtors falling Due within one year

(2,575,462)

1,020,470

50,649

(590,771)

(Increase) / Decrease in Dues from Related Parties

38,085

86,231

(92,369)

98,738

Decrease in Dues to Related Parties

(545,390)

(266,065)

(602,890)

(276,415)

Increase/(Decrease) in Security Deposits

51,077

(29,103)

51,078

(29,103)

Increase in Trade and Other Payables

582,199

555,130

637,766

640,410

Increase / (Decrease) in Deferred Liabilities

50,010

(772)

50,010

(765)

Cash Generated from Operations

1,171,284

4,237,064

4,994,470

2,096,189

Finance Costs Paid

(768,285)

(1,299,516)

(761,848)

(1,258,121)

Retiring Gratuity Paid

(20,636)

(15,403)

(18,394)

(1,915)

Income Tax Paid

(109,141)

(56,502)

(56,000)

-

Net Cash from Operating Activities

273,222

2,865,643

4,158,228

836,153

Cash Flows from /(used in) Investing Activities

Acquisition of Property, Plant and Equipment and Intangible Assets

(116,434)

(179,658)

(60,150)

(136,744)

Proceeds from Disposal of Property Plant and Equipment

11,638

163

11,442

163

Acquisition of Marketable Securities

(69,140)

(145,433)

-

-

(Investment) / Withdrawal of Bank Deposits

-

1,052,338

-

-

Interest Income Received

157,531

400,802

16,049

63,605

Net Cash Flows from/(used in) Investing Activities

(16,405)

1,128,212

(32,659)

(72,976)

Cash Flows from/(used in) Financing Activities

Net proceeds from/(settlement to) Interest - Bearing Loans and Borrowings

(2,866,221)

(1,874,061)

(2,228,580)

650,690

Net settlements to Lease Creditors

(448,817)

(301,910)

(373,837)

(267,855)

Increase in Customer Deposit Liabilities

979,307

1,908,068

-

-

Dividends Paid

-

(38)

-

(37)

Net Cash Flows from/(used in) Financing Activities

(2,335,731)

(267,941)

(2,602,417)

382,798

Net Increase /(Decrease) in Cash and Cash Equivalents

(2,078,913)

3,725,914

1,523,152

1,145,975

Cash and Cash Equivalents at the Beginning of the Year

3,642,978

2,808,492

97,745

354,844

Cash and Cash Equivalents as at the end of Period

1,564,066

6,534,406

1,620,896

1,500,819

ANALYSIS OF CASH & CASH EQUIVALENTS

Favourable balances

Cash in hand and at bank

4,224,461

7,838,387

3,474,607

2,486,284

Unfavourable balances

Bank overdrafts

(2,660,395)

(1,303,981)

(1,853,711)

(985,465)

1,564,066

6,534,406

1,620,896

1,500,819

6 SINGER (SRI LANKA) PLC

Interim Financial Statements For the Three Months ended 30th June 2024

Notes to the Financial Statements

  1. BASIS OF PREPARATION AND GROUP'S ACCOUNTING POLICIES
    The interim condensed consolidated financial statements for the three months ended 30th June 2024 have been prepared in accordance with
    LKAS 34 Interim Financial Reporting
    The Financial Statements for the period ended 30th June 2024, includes "the Company" referring to Singer (Sri Lanka) PLC, as the holding company and "the Group" referring to the companies whose accounts have been consolidated therein
    The interim condensed Consolidated Financial Statements do not include all the information and disclosures required in the Annual Financial
    Statements, and should be read in conjunction with the Group's Annual Consolidated Financial Statements as at 31 March 2024
    The presentation and classification of the Financial Statements of the previous period have been amended, where relevant, for better presentation and to be comparable with those of the current period.
    The interim Condensed Financial Statements are presented in Sri Lankan Rupees (LKR) and all values are rounded to the nearest thousand except when otherwise indicated
  2. Fair Value measurement and related fair value disclosures - Financial Instruments

Group

Company

Recurring Fair Value Measurements

2024

2024

2024

2024

Level

June

March

June

March

Rs. '000

Rs."000"

Rs. '000

Rs."000"

Investment in Equity Securities

22,326

22,326

20,141

20,141

3

Financial Assets at FVOCI

22,326

22,326

20,141

20,141

1.2 Impact of Recent Economic Conditions

The Directors are continuously monitoring the existing and the anticipated effects from the external environment, as well as the resulting consequences to the company in order to take appropriate measures to manage the impact.

(i) Interest rates

LKR interest rates in the domestic market reduced marginally during the quarter ended June 30, 2024 with the policy measures adopted by CBSL The LKR interest rates are expected to stabilize at current levels, with the deceleration of inflation in the domestic economy, coupled with resultant improvement of the economic condition of the country with the engagement of the IMF program and the Debt Optimization program.

Following measures were taken to reduce/manage the debt level of the company

  • Extend credit received from suppliers for purchase of Inventories to reduce borrowings.
  • Continuous control and monitoring measures taken to improve the recoveries from debtors to reduce the borrowings
  • Strategic initiatives driven by the management to prioritise essential capital expenditure
  • A focused effort to reduce Inventory thereby reducing borrowings

ii) Exchange Rates

The LKR/USD continued to be at 300-305 levels due to the prudent policy measures adopted by CBSL,along with the resultant decline in importer demand and improvement of the Balance of Payment of the country.

The following measures were taken to reduce the impact of a significant depreciation of the Rupee;

  • Implemented prudent strategies to revise price in a timely manner based on market outlook
  • Entering into forward rate contracts to mitigate foreign currency risk

SINGER (SRI LANKA) PLC

7

Interim Financial Statements For the Three Months ended 30th June 2024

Notes to the Financial Statements

iii) Other Considerations

The VAT change implemented with effect from 01 st January 2024, which resulted in panic buying before the VAT hike in December 2023, may see a reduction in consumer demand in the short term.

The escalation of violence along the red sea will increase the price of products imported to the country and may see delays in receiving products in the near term.

Despite the current slow down of the economy,the marketing and business development teams of the group continues to pursue new business to diversify the risk arising due to negative externalities ,whilst the operational teams focus on improving production efficiencies and reducing costs in order to increase the gross profit margins.

2.0 Segmental Analysis of Company Net Turnover is as follows:

Three Months ended

30th June 2024

Rs. '000

Three Months ended 30th June 2023

Rs'000

Consumer Electronics

2,114,744

916,039

Financial Services

1,543,957

1,068,822

Furniture

1,013,844

951,287

Home Appliances

7,380,615

4,574,268

IT products

3,758,961

2,500,259

Sewing Machines

499,160

426,245

Other

922,881

892,242

17,234,163

11,329,162

2.1 Segmental Analysis of Company Profits Before Tax is as follows:

Three Months ended

30th June 2024

Rs. '000

Three Months ended 30th June 2023

Rs'000

Consumer Electronics

191,078

(8,765)

Financial Services

365,501

351,253

Furniture

50,569

(4,479)

Home Appliances

694,637

(29,342)

IT products

160,426

(11,228)

Sewing Machines

49,279

(4,385)

Other

(2,287)

(2,218)

Impairment (Loss) / Reversal on Trade and Other Receivables

(131,692)

(110,132)

Operating Profit

1,377,510

180,704

Net Finance Cost

(673,086)

(1,242,771)

VAT on Financial Services

(20,000)

(14,000)

Profit /(Loss) Before Tax

684,424

(1,076,067)

8 SINGER (SRI LANKA) PLC

Interim Financial Statements For the Three Months ended 30th June 2024

Notes to the Financial Statements

2.2 Segmental Analysis of Group Net Turnover is as follows:

Three Months ended

30th June 2024

Rs. '000

Three Months ended 30th June 2023

Rs'000

Consumer Electronics

2,114,744

916,039

Financial Services

3,432,364

2,722,045

Furniture

1,013,844

951,287

Home Appliances

7,381,842

4,579,336

IT products

3,758,961

2,500,259

Sewing Machines

499,160

426,302

Other

922,881

899,717

19,123,797

12,994,985

2.3 Segmental Analysis of Group Profits Before Tax is as follows:

Three Months ended

30th June 2024

Rs. '000

Three Months ended 30th June 2023

Rs'000

Consumer Electronics

191,078

(8,765)

Financial Services

543,060

284,911

Furniture

50,569

(4,479)

Home Appliances

702,564

(85,489)

IT Products

160,426

(11,228)

Sewing Machines

49,279

(84,868)

Other

(795)

2,579

Impairment (Loss) / Reversal on Trade and Other Receivables

(175,301)

(188,517)

Operating Profit / (Loss)

1,525,880

(95,856)

Net Finance Cost

(520,708)

(910,856)

VAT on Financial Services

(112,770)

(71,973)

Profit /(Loss) Before Tax

892,402

(1,078,685)

3 STATED CAPITAL

3.1

30th June 2024

31st March 2024

Value-Ordinary Shares (Rs.)

1,138,856,653

1,138,856,653

Number of Ordinary Shares at the end of the Period

1,167,617,912

1,167,617,912

Voting Rights

One Vote per Ordinary

One Vote per Ordinary

Share

Share

SINGER (SRI LANKA) PLC

9

Interim Financial Statements For the Three Months ended 30th June 2024

Notes to the Financial Statements

4 CONTINGENCIES

  1. Commissioner General of Inland Revenue has issued assessment notices on Singer (Sri Lanka) PLC pertaining to an additional VAT Liability/ Payment on account of Deemed VAT for seven quarters during the period 1st January 2014 to 30th September 2015. The assessments were for a Deemed VAT payment of Rs. 1,076 million and penalty of Rs. 423 million, totaling to Rs. 1,499 million. The assessments were appealed against and in due course the Commissioner General of Inland Revenue issued the determination on the appeal. In terms of the same, Rs. 791 million of Deemed VAT liability and penalty of Rs. 395 million totaling to Rs.1,186 million was held to be a Deemed VAT liability for the seven quarters for the period from 1st January 2014 to 30th September 2015. The Company after carefully reviewing the situation and based on the advice of tax consultants, was of the opinion that there is no basis for the Company to be made liable for Deemed VAT. Accordingly the Company decided to appeal to the Tax Appeals Commission against the determination. Further, the Company had previously provided bank guarantees amounting to Rs. 297 million to the Commissioner General of Inland Revenue - Tax Appeals Commission.
    The Tax Appeals Commission hearings were concluded on 28th February 2023, and the determinations were consequently issued on the 17th of May 2023 and 23rd May 2023 for all seven quarters for the period from 1st January 2014 to 30th September 2015 - Though the Company was not informed of such determinations for a period of approximately one month from such dates. The Tax Appeals Commission in determining the case has confirmed the purported determinations made by the Commissioner General of Inland Revenue for all seven quarters.
    Accordingly at the time of receiving the said determinations on the 20th of June 2023, the company deposited 10% of the pending assessed value amounting to Rs. 108 Mn in lieu of renewing the bank guarantees which were previously given.
    The Company after carefully reviewing the situation and based on the advice of tax consultants, is of the opinion that there is no basis for the
    Company to be made liable for Deemed VAT. Accordingly, the Company has decided to seek the judicial review in the Appellate Court against the determination issued by the Tax Appeals Commission by making an application for a case stated,which was submitted to the Court of Appeal in August 2023. Hence, no provision has been made in the Financial Statements until the matter has been determined by the Court.
  2. Commissioner General of Inland Revenue has issued an assessment notice on Singer (Sri Lanka) PLC pertaining to an additional VAT on Financial Services Liability for the taxable period of 01st January 2016 to 31 December 2016. The assessment was for a VAT on Financial Services payment of Rs. 27 million and penalty of Rs. 16 million, totaling to Rs. 43 million. Subsequently, Commissioner General of Inland Revenue had given the determination on the appeal. As per the same, Rs . 26 million of VAT on Financial Services liability and a penalty of Rs. 26 million totaling to Rs. 52 million is payable as a VAT on Financial Services liability for the period 1st January 2016 to 31st December 2016. The Company after carefully reviewing the situation and based on the advice of tax consultants, was of the opinion that the Company has strong grounds on which to contest the CGIR's determination. Accordingly, the Company decided to appeal to the Tax Appeal Commission against the determination on 17th August 2021. Further, the Company has provided a bank guarantee amounting to Rs.13 million to the Commissioner General of Inland Revenue - Tax Appeal Commission on 03rd December 2021.
  3. Commissioner General of Inland Revenue has issued assessment notices on Singer Digital Media (Pvt) Ltd which has been amalgamated with Singer (Sri Lanka) PLC pertaining to an additional Income Tax Liability for the Year of Assessment 2018/2019. The assessment was for an income tax payment of Rs. 86 million and interest and penalty of Rs. 44 million and Rs. 16 million respectively, totaling to Rs. 147 million.
    Since, the Commissioner General of Inland Revenue has failed to make the determination on the appeal, the Company has decided to appeal to the Tax Appeal Commission against the assessment dated 25th May 2022. Further, Company provided a bank guarantee amounting to Rs. 37 million to the Commissioner General of Inland Revenue - Tax Appeals Commission on 02nd March 2023.
    The determination was issued by the Tax Appeals Commission for the year of assessment 2018/2019 on 21st November 2023 confirming the assessment notices issued. The tax authorities has exercised the bank guarantee of Rs. 37 million on 7th December 2023.
    The Company after carefully reviewing the situation and based on the advice of tax consultants, is of the opinion that there is no basis for the
    Company to be made liable for Income Tax. Accordingly, the Company has decided to seek the judicial review in the Appellate Court against the determination issued by the Tax Appeals Commission by making an application for a case stated , which was submitted to the Court of Appeal in February 2024. Hence, no provision has been made in the Financial Statements until the matter has been determined by the Court.
  4. Singer (Sri Lanka) PLC has provided bank guarantees amounting to Rs. 407 million to Director General of Customs to clear imports during the years 2008 to June 2024. The bank guarantee related to alleged additional duty payable on imports, claimed by the customs and is being contested by the Company in courts. The Court of Appeal ordered that the Director General of Customs continue with the investigations. The
    Company being aggrieved by the decision has filed an appeal, which is pending before the Supreme Court. The Company lawyers are of the opinion that there is no basis that the Company is liable for the additional duty. Based on assessment the probability is higher that the Company would not be required to settle the liabilities. Hence, no provision is made in the Financial Statements

10 SINGER (SRI LANKA) PLC

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