THREE ACRE FARMS PLC
INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2024
QUARTERLY REVIEW for the socond quarter ended 30 June 2024
The Group's revenue for the second quarter of 2024 was Rs. 1,685.2Mn compared to Rs. 2,728.5Mn during the same quarter of 2023, representing a decrease of Rs. 1,043.3Mn or 38%. The Group's revenue for the first half of 2024 was Rs. 3,535.2Mn compared to Rs. 4,806.9Mn during the first half of 2023, representing a decrease of Rs. 1,271.7Mn or 26%.
The Group reported a profit of Rs. 433.6Mn for the second quarter of 2024 compared to Rs. 700.0Mn during the same quarter of 2023, representing a decrease of Rs. 266.4Mn or 38%. The Group reported a profit of Rs. 1,051.1Mn for the first half of 2024 compared to Rs. 910.0Mn during the first half of 2023, representing an increase of Rs. 141.1Mn or 16%.
During the second quarter under review, revenue declined primarily due to the reduced demand for Broiler Day Old Chicks (DOCs). This decrease was driven by an oversupply of chicken, exacerbated by persistent adverse weather conditions which affected the HoReCa sector. However, demand for Layer DOCs remained steady, bolstered by favorable consumer demand for table eggs as an affordable, protein-rich alternatives.
Profitability decreased during the quarter in line with the drop in both volume and price of Broiler DOCs. Further, taxation increased compared to the same period last year due to the removal of government tax exemptions on agro-farming.
The Company and the Group have complied with the Sri Lanka Financial Reporting Standards in the Preparation of the Interim Financial Statements for the period ended 30 June 2024.
There have been no other events subsequent to the interim period which require disclosure in the Interim Financial Statements.
(Sgd.) Cheng Chih Kwong
Executive Director and Chief Executive Officer
(Sgd.) S S P Corporate Services (Private) Limited
Secretaries
Interim Financial Statements
Three Acre Farms PLC | 2
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
All amounts in Sri Lankan Rupees thousands
Group | Group | Company | |||||||||
For the three months ended 30 June | 2024 | 2023 | Change | 2024 | 2023 | ||||||
Revenue | 1,685,241 | 2,728,519 | (38%) | 1,320,925 | 2,541,365 | ||||||
Cost of sales | (1,231,758) | (2,096,167) | (41%) | (974,349) | (2,008,087) | ||||||
Gross profit | 453,483 | 632,352 | (28%) | 346,576 | 533,278 | ||||||
Other operating income | 2,468 | 3,398 | (27%) | 3,008 | 3,440 | ||||||
Selling and distribution expenses | (3,429) | (3,373) | 2% | (3,429) | (3,373) | ||||||
Administrative expenses | (12,188) | (10,697) | 14% | (9,369) | (8,251) | ||||||
Operating profit | 440,334 | 621,680 | (29%) | 336,786 | 525,094 | ||||||
Interest income | 175,434 | 107,924 | 63% | 175,434 | 107,924 | ||||||
Net finance income | 1,969 | 2,809 | (30%) | 1,969 | 2,741 | ||||||
Profit before tax | 617,737 | 732,413 | (16%) | 514,189 | 635,759 | ||||||
Taxation | (184,140) | (32,375) | 469% | (153,240) | (32,375) | ||||||
Profit for the period | 433,597 | 700,038 | (38%) | 360,949 | 603,384 | ||||||
Other comprehensive income for the period, | - | - | - | - | |||||||
net of tax | |||||||||||
Total comprehensive income for the period | 433,597 | 700,038 | (38%) | 360,949 | 603,384 |
Profit attributable to : | |||||
Equity holders of the parent | 433,597 | 700,038 | 360,949 | 603,384 | |
433,597 | 700,038 | 360,949 | 603,384 | ||
Total comprehensive income attributable to : | |||||
Equity holders of the parent | 433,597 | 700,038 | 360,949 | 603,384 | |
433,597 | 700,038 | 360,949 | 603,384 | ||
Basic earnings per share (Rs.) | 18.42 | 29.73 | 15.33 | 25.63 |
Interim Financial Statements
Three Acre Farms PLC | 3
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
All amounts in Sri Lankan Rupees thousands
Group | Group | Company | |||||||||
For the six months ended 30 June | 2024 | 2023 | Change | 2024 | 2023 | ||||||
Revenue | 3,535,164 | 4,806,900 | (26%) | 2,813,191 | 4,411,288 | ||||||
Cost of sales | (2,366,785) | (3,989,176) | (41%) | (1,896,367) | (3,710,739) | ||||||
Gross profit | 1,168,379 | 817,724 | 43% | 916,824 | 700,549 | ||||||
Other operating income | 5,563 | 5,718 | (3%) | 6,091 | 6,006 | ||||||
Selling and distribution expenses | (7,429) | (7,220) | 3% | (7,429) | (7,220) | ||||||
Administrative expenses | (23,523) | (20,294) | 16% | (17,972) | (15,397) | ||||||
Operating profit | 1,142,990 | 795,928 | 44% | 897,514 | 683,938 | ||||||
Interest income | 367,334 | 164,938 | 123% | 367,334 | 164,938 | ||||||
Net finance costs | 141% | ||||||||||
(3,692) | (1,530) | (3,692) | (1,686) | ||||||||
Profit before tax | 1,506,632 | 959,336 | 57% | 1,261,156 | 847,190 | ||||||
Taxation | (455,540) | (49,365) | 823% | (380,640) | (49,365) | ||||||
Profit for the period | 1,051,092 | 909,971 | 16% | 880,516 | 797,825 | ||||||
Other comprehensive income for the period, | - | - | - | - | |||||||
net of tax | |||||||||||
Total comprehensive income for the period | 1,051,092 | 909,971 | 16% | 880,516 | 797,825 |
Profit attributable to : | |||||
Equity holders of the parent | 1,051,092 | 909,971 | 880,516 | 797,825 | |
1,051,092 | 909,971 | 880,516 | 797,825 | ||
Total comprehensive income attributable to : | |||||
Equity holders of the parent | 1,051,092 | 909,971 | 880,516 | 797,825 | |
1,051,092 | 909,971 | 880,516 | 797,825 | ||
Basic earnings per share (Rs.) | 44.64 | 38.65 | 37.40 | 33.89 |
Interim Financial Statements
Three Acre Farms PLC | 4
STATEMENT OF FINANCIAL POSITION
All amounts in Sri Lankan Rupees thousands | |||||
Group | Company | ||||
As at | 30.06.2024 | 31.12.2023 | 30.06.2024 | 31.12.2023 | |
Assets | |||||
Non-current assets | |||||
Property, plant and equipment | 1,209,569 | 1,240,217 | 977,546 | 1,001,841 | |
Investment in subsidiary companies | - | - | - | - | |
Biological assets | 835,907 | 663,266 | 672,460 | 572,363 | |
Total non-current assets | 2,045,476 | 1,903,483 | 1,650,006 | 1,574,204 | |
Current assets | |||||
Biological assets | 82,982 | 84,905 | 45,507 | 66,450 | |
Inventories | 343,978 | 381,574 | 308,483 | 327,028 | |
Trade and other receivables | 79,083 | 124,579 | 53,945 | 116,344 | |
Amount due from related companies | 1,587,575 | 1,267,381 | 1,234,092 | 1,216,123 | |
Short-term investments | 6,065,871 | - | 6,065,871 | - | |
Cash and cash equivalents | 175,821 | 5,653,578 | 179,131 | 5,052,704 | |
Total current assets | 8,335,310 | 7,512,017 | 7,887,029 | 6,778,649 | |
Total assets | 10,380,786 | 9,415,500 | 9,537,035 | 8,352,853 | |
Equity | |||||
Stated capital | 623,604 | 623,604 | 623,604 | 623,604 | |
Retained earnings | 8,075,274 | 7,400,902 | 7,078,890 | 6,575,094 | |
Total equity | 8,698,878 | 8,024,506 | 7,702,494 | 7,198,698 | |
Liabilities | |||||
Non-current liabilities | |||||
Deferred tax liabilities | 378,710 | 373,710 | 303,641 | 299,641 | |
Employee benefits | 48,423 | 44,985 | 45,373 | 42,535 | |
Total non-current liabilities | 427,133 | 418,695 | 349,014 | 342,176 | |
Current liabilities | |||||
Trade and other payables | 1,241,016 | 958,801 | 978,369 | 790,659 | |
Amount due to related companies | 13,759 | 13,498 | 507,158 | 21,320 | |
Total current liabilities | 1,254,775 | 972,299 | 1,485,527 | 811,979 | |
Total liabilities | 1,681,908 | 1,390,994 | 1,834,541 | 1,154,155 | |
Total equity and liabilities | 10,380,786 | 9,415,500 | 9,537,035 | 8,352,853 | |
Net asset per share (Rs.) | 369.46 | 340.82 | 327.14 | 305.74 |
(Sgd.) K. A. R. S. Perera
General Manager
(Sgd.) Wickrema Senaka Weerasooria | (Sgd.) Cheng Chih Kwong |
Non-Executive Independent Chairman | Executive Director and Chief Executive Officer |
Interim Financial Statements
Three Acre Farms PLC | 5
STATEMENT OF CHANGES IN EQUITY
All amounts in Sri Lankan Rupees thousands
Group | Stated | Retained | Total | ||||||||
capital | earnings | equity | |||||||||
Balance as at 1 January 2023 | 623,604 | 5,185,629 | 5,809,233 | ||||||||
Profit for the period | - | 909,971 | 909,971 | ||||||||
Other comprehensive income for the period, net of tax | - | - | - | ||||||||
Balance as at 30 June 2023 | 623,604 | 6,095,600 | 6,719,204 | ||||||||
Balance as at 1 January 2024 | 623,604 | 7,400,902 | 8,024,506 | ||||||||
Profit for the period | |||||||||||
- | 1,051,092 | 1,051,092 | |||||||||
Other comprehensive expense for the period, net of tax | - | - | - | ||||||||
Dividend paid | |||||||||||
- | (376,720) | (376,720) | |||||||||
Balance as at 30 June 2024 | 623,604 | 8,075,274 | 8,698,878 | ||||||||
Company | Stated | Retained | Total | ||||||||
capital | earnings | equity | |||||||||
Balance as at 1 January 2023 | 623,604 | 4,237,233 | 4,860,837 | ||||||||
Profit for the period | - | 797,825 | 797,825 | ||||||||
Other comprehensive income for the period, net of tax | - | - | - | ||||||||
Balance as at 30 June 2023 | 623,604 | 5,035,058 | 5,658,662 | ||||||||
Balance as at 1 January 2024 | 623,604 | 6,575,094 | 7,198,698 | ||||||||
Profit for the period | - | 880,516 | 880,516 | ||||||||
Other comprehensive expense for the period, net of tax | - | - | - | ||||||||
Dividend paid | - | (376,720) | (376,720) | ||||||||
Balance as at 30 June 2024 | 623,604 | 7,078,890 | 7,702,494 |
Interim Financial Statements
Three Acre Farms PLC | 6
STATEMENT OF CASH FLOWS
All amounts in Sri Lankan Rupees thousands | |||||||||||
Group | Company | ||||||||||
For the six months ended 30 June | 2023 | 2023 | |||||||||
2024 | 2024 | ||||||||||
Operating activities | |||||||||||
Profit before tax | 1,506,632 | 1,261,156 | 847,190 | ||||||||
959,336 | |||||||||||
Adjustments: | |||||||||||
Depreciation | 52,569 | 42,325 | |||||||||
44,791 | 34,643 | ||||||||||
Usage of biological assets | |||||||||||
357,899 | 368,325 | 256,609 | 268,454 | ||||||||
Amortisation of right-of-use assets | |||||||||||
- | 1,190 | - | 2,232 | ||||||||
Exchange loss | |||||||||||
3,668 | 1,206 | 3,667 | 1,206 | ||||||||
Interest income | |||||||||||
(367,334) | (164,938) | (367,334) | (164,938) | ||||||||
Interest expenses | |||||||||||
24 | 323 | 25 | 480 | ||||||||
Changes in working capital | |||||||||||
-Trade and other receivables | |||||||||||
158,416 | (633) | 175,319 | (6,248) | ||||||||
-Inventories | 37,596 | (23,397) | 18,545 | (23,083) | |||||||
-Trade and other payables | (74,668) | (143,155) | (95,802) | (97,921) | |||||||
-Amount due from related companies | (320,194) | 2,087,659 | (17,969) | 1,654,607 | |||||||
-Amount due to related companies | |||||||||||
261 | (313) | 485,838 | 544,458 | ||||||||
Employee benefits | |||||||||||
4,200 | 2,590 | 3,600 | 2,350 | ||||||||
Cash generated from operations | |||||||||||
1,359,069 | 3,130,518 | 1,768,445 | 3,063,430 | ||||||||
Exchange loss | (3,668) | (1,206) | (3,667) | (1,206) | |||||||
Interest received | |||||||||||
254,414 | 245,687 | 254,414 | 245,687 | ||||||||
Interest paid | |||||||||||
(24) | (145) | (25) | (145) | ||||||||
Lease liability paid | |||||||||||
- | (1,680) | - | (3,150) | ||||||||
Employee benefits paid | |||||||||||
(762) | (654) | (762) | (654) | ||||||||
Tax paid | |||||||||||
(93,657) | (45,206) | (93,128) | (42,721) | ||||||||
Net cash generated from operating activities | |||||||||||
1,515,372 | 3,327,314 | 1,925,277 | 3,261,241 | ||||||||
Investing activities | |||||||||||
Purchase of property, plant and equipment | (21,921) | (13,731) | (20,496) | (13,684) | |||||||
Purchase of biological assets | |||||||||||
(528,617) | (474,217) | (335,763) | (374,539) | ||||||||
Net cash used in investing activities | |||||||||||
(550,538) | (487,948) | (356,259) | (388,223) | ||||||||
Financing activities | |||||||||||
Short-term investments | (6,065,871) | - | (6,065,871) | - | |||||||
Dividend paid | |||||||||||
(376,720) | - | (376,720) | - | ||||||||
Net cash used in financing activities | (6,442,591) | - | (6,442,591) | - | |||||||
(Decrease) / increase in cash and cash equivalents | (5,477,757) | 2,839,366 | |||||||||
(4,873,573) | 2,873,018 | ||||||||||
Movement in cash and cash equivalents | |||||||||||
At the beginning of the year | 5,653,578 | 1,081,478 | 5,052,704 | 1,081,407 | |||||||
(Decrease) / increase for the period | (5,477,757) | 2,839,366 | (4,873,573) | 2,873,018 | |||||||
Balance at the end of the period | 175,821 | 3,920,844 | 179,131 | 3,954,425 |
Interim Financial Statements
Three Acre Farms PLC | 7
NOTES TO THE INTERIM FINANCIAL STATEMENTS
1. CORPORATE INFORMATION
Three Acre Farms PLC (the "Company") is a "Quoted Public Company" with limited liability, incorporated and domiciled in Sri Lanka. The address of the Company's registered office is No. 15, Rock House Lane, Colombo 15, Sri Lanka.
The principal businesses of the Group are selective breeding, hatching, sale of Commercial Day Old Chicks (DOCs), both Broiler (for chicken meat) and Layer (for the production of table eggs), grandparent farm operation and commercial broiler farming.
The Company was listed in the Colombo Stock Exchange under the Food and Beverage Sector. The parent company, Ceylon Grain Elevators PLC holds 57.21% of the issued share capital of the Company.
2. APPROVAL OF FINANCIAL STATEMENTS
The interim financial statements of the Company and the Group for the six months ended 30 June 2024 are unaudited and authorised for issue by the Board of Directors on 7 August 2024.
3. BASIS OF PREPARATION
The interim financial statements of the Company and the Group have been prepared in compliance with Sri Lanka Accounting Standard (LKAS) 34 - Interim Financial Reporting.
The interim financial statements have been prepared on a historical cost basis except for defined benefit obligation and biological assets.
4. ACCOUNTING POLICIES
The accounting policies adopted are consistent with those of the previous financial year.
5. CONTINGENT LIABILITIES
There has not been any significant change in the nature of the contingent liabilities, which were disclosed in the Annual Report for the year ended 31 December 2023.
6. EVENTS AFTER THE REPORTING PERIOD
Subsequent to 30 June 2024, there are no events, which require adjustments to or disclosure in the Financial Statements.
7. COMPARATIVE INFORMATION
The presentation and classification of the financial statements of the previous period have been adjusted where relevant, for better presentation and to be comparable with current reporting.
8. NM - Change in percentage term is Not Meaningful.
Interim Financial Statements
Three Acre Farms PLC | 8
INVESTOR INFORMATION
(01) Market Price per Share | As at | As at |
30.06.2024 | 30.06.2023 | |
Highest Market Price (Rs.) | 324.50 | 143.75 |
Lowest Market Price (Rs.) | 273.75 | 131.00 |
Closing Market Price (Rs.) | 306.75 | 136.00 |
(02) Public Shareholding | As at | As at |
30.06.2024 | 30.06.2023 | |
The percentage of shares held by the public | 27.78% | 27.78% |
The number of shareholders representing the public holding | 2,582 | 2,650 |
Float Adjusted Market Capitalisation |
The float adjusted market capitalisation as at 30 June 2024 was Rs.2,006.4 Mn under Option 5 of Section
7.14.1 (a) of the Listing Rules of the Colombo Stock Exchange and the Company has complied with the minimum public holding requirement applicable under the said option.
- List of 20 major shareholders based on their shareholding as at 30 June 2024.
No. | Name | No. of | Percentage |
Shares | |||
1 | Ceylon Grain Elevators PLC | 13,469,980 | 57.21 |
2 | Prima Limited, Singapore | 3,532,627 | 15.00 |
3 | UBS Switzerland AG -Kershaw Property Holding Inc. | 617,360 | 2.62 |
4 | Budleaf Pty Limited | 408,368 | 1.73 |
5 | Eka Limited | 313,262 | 1.33 |
6 | People's Leasing & Finance PLC / Mr. I. D. R. Perera | 265,000 | 1.13 |
7 | Supra Limited, Hong Kong | 258,989 | 1.10 |
8 | Sandwave Limited | 192,709 | 0.82 |
9 | Mr. M. N. Singa Laxana | 187,000 | 0.80 |
10 | Bansei Securities Capital (Pvt) Ltd / I. S. P. Perera | 165,000 | 0.70 |
11 | Deutsche Bank AG-National Equity Fund | 156,458 | 0.67 |
12 | Mercantile Investments and Finance PLC | 153,545 | 0.65 |
13 | J.B Cocoshell (Pvt) Ltd | 152,653 | 0.65 |
14 | Mrs. J. K. D. Jayatillake / Mr.A. Jayatillake | 146,397 | 0.62 |
15 | Mrs. S. Vasudevan / Mr. S. Vasudevan | 113,210 | 0.48 |
16 | Amana Bank PLC / Hi-Line Trading (Pvt) Ltd | 101,902 | 0.43 |
17 | Mr. A. S. Rathnayake | 94,139 | 0.40 |
18 | Amana Bank PLC / Hi-Line Towers (Pvt) Ltd | 82,949 | 0.35 |
19 | Mr.R. E. Rambukwelle | 72,677 | 0.31 |
20 | Hatton National Bank PLC / R. E. Rambukwelle | 72,000 | 0.31 |
Total | 20,556,225 | 87.31 |
Interim Financial Statements
Three Acre Farms PLC | 9
CORPORATE INFORMATION
Company Name | Lawyers |
Three Acre Farms PLC | Varners Lanka Law Office |
D. L. & F. De Saram | |
Company Registration No. | |
PQ 195 | |
Auditors | |
Registered Office | KPMG, Sri Lanka |
No. 15, Rock House Lane, Colombo 15, Sri Lanka. | |
Tel : +94 (11) 2522556 or 8 / 2523580 / 2526378 to 2526383 | Company Secretary |
Fax : +94 (11) 2524163 | S S P Corporate Services (Private) Limited |
E-mail : info.cge@prima.com.lk | No. 101, Inner Flower Road, Colombo 3 |
Stated Capital | Bankers |
Rs. 623,604,000 | Hatton National Bank PLC |
Nations Trust Bank PLC | |
Number of Shares | National Development Bank PLC |
23,545,000 Ordinary Shares | Bank of Ceylon |
Seylan Bank PLC | |
Subsidiary Companies | Union Bank of Colombo PLC |
Ceylon Pioneer Poultry Breeders Limited | |
Millennium Multibreeder Farms (Private) Limited | |
Name of Directors | |
Mr. Wickrema Senaka Weerasooria | - Non-Executive Independent Chairman |
Mr. Cheng Chih Kwong | - Executive Director and Chief Executive Officer |
Mr. Damrong Valentino Yap Tiong Seng (Resigned w.e.f. 03.06.2024) | - Executive Director and Group General Manager |
Mr. Cheng Koh Chuen, Bernard | - Non-Executive Director |
Mr. Sunil Leeniyagoda | - Non-Executive Director |
Dr. Prathap Ramanujam | - Non-Executive Independent Director |
Mr. R. N. Asirwatham | - Non-Executive Independent Director |
Directors Shareholding | |
Mr. Wickrema Senaka Weerasooria | - 2,000 Shares |
Mr. Cheng Chih Kwong | - 19 Shares |
Mr. Damrong Valentino Yap Tiong Seng (Resigned w.e.f. 03.06.2024) | - Nil |
Mr. Cheng Koh Chuen, Bernard | - Nil |
Mr. Sunil Leeniyagoda | - Nil |
Dr. Prathap Ramanujam | - Nil |
Mr. R. N. Asirwatham | - Nil |
Interim Financial Statements
Three Acre Farms PLC | 10