Qurain Petrochemical Industries Company K.S.C.P. and its Subsidiaries INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORM A TJON 30 SEPTEMBER 2016 (UNAUDITED)
Qurain Petrochemical Industries Company K.S.C.P. and its Subsidiaries
INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORM A TJON
30 SEPTEMBER 2016 (UNAUDITED)
EY Building a better working world
Ernst & Young AI Aiban, AI Osa1mi & Partners PO. Box 74 18-2lst Floor; Ba1tak Tower Ahmed AI Jaber Street Safat Square 13001, Kuwa1t
Tel : +965 2 295 5000 Fax: +965 2 245 6419 kuwa't~kw.ey.com ey.com/mena
REPORT ON REVIEW OF INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION TO THE BOARD OF DIRECTORS OF QURAIN PETROCHEMICAL INDUSTRIES COMPANY K.S.C.P.
Introduction We have reviewed the accompanying interim condensed consolidated statement of frnancial position of Qurain Petrochemical Industries Company K.S.C.P. (the "Parent Company") and its subsidiaries (collectively the "Group") as at 30 September 2016, and the related interim condensed consolidated statement of income and interim condensed consolidated statement of comprehensive income for the three months and six months period then ended, and the related interim condensed consolidated statement of changes in equity and the interim condensed consolidated statement of cash flows for the six months period then ended. The management of the Parent Company is responsible for the preparation and presentation of this interim condensed consolidated financial information in accordance with International Accounting Standard 34, Interim Financial Reporting ("lAS 34"). Our responsibility is to express a conclusion on this interim condensed consolidated financial information based on our review.
Scope of Review We conducted our review in accordance with the International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity." A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed consolidated financial information is not prepared, in all material respects, in accordance with lAS 34.
Report on Other Legal and Regulatory Requirements Furthermore, based on our review, the interim condensed consolidated financia l information is in agreement with the books of account of the Parent Company. We further report that, to the best of our knowledge and belief, we have not become aware of any violations of the Companies Law No. I of 2016, and its executive regulations, or of the Parent Company' s Articles of Association and Memorandum of Incorporation, as amended, during the six months period ended 30 September 2016 that might have had a material effect on the business of the Parent Company or on its financial position.
W ALEED A. AL OSAIMI LICENCE NO. 68 A EY AL AlBAN, AL OSAIMI & PARTNERS
27 October 2016 Kuwait
Qurain Petrochemical Industries Company K.S.C. P. and Subsidiaries -~~~ INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED) As at 30 September 201 6
ASSETS Current assets Cash and cash equivalents Trade and other receivables Inventories
Total current assets
Non-current assets Due from a related party Financial assets avai lable for sale Investment in associates Goodwill and other intangible assets Property, plant and equipment
Total non-current assets
Total assets
LIABILITIES AND EQUITY LIABILJTlES Current liabilities Trade and other payablcs Bank overdraft
Total current liabilities
Non-current liabilities Employees' end of service benefits Tenn loans
Total non-current liabilities
Total liabiUties
EQUITY Share capital Statutory reserve Voluntary reserve Treasury shares Other reserves Cumulative changes in fai r values foreign currency translation reserve Retained earnings
Equity attributable to shareholders of the Parent Company Non-controlling interests
Total equity
30 September 2016
Notes KD
(Audited) 31 March
2016 KD
4
9 5
4
6
35,809,471 35,460, 196 14,412,635 15,893,749 29,902,182 31,134,988
80,124,288 82,488,933
1,250,000 1,250,000 185,870,773 180,388,934 89,926,350 8 1,609,476
105,627,507 I 06,850,012 69,119,732 68,879,163
451,794,362 438,977,585
531,918,650 521,466,518
32,012,103 26,591,586 7,469,708
39,481,811 26,591,586
9,645,310 8,923,873 62,891,700 65,715,352
72,537,010 74,639,225
112,018,821 101,230,81 I
109,919,258 109,919,258 18,983,391 18,983,391 18,861,689 18,861,689
(11,825,036) ( I I ,825,036) 127,851 124,329
91,032,272 9 1,388,257 8,216,557 8,833,758
78,001,012 77,915,1 47
313,316,994 3 14,200,793 106,582,835 106,034,914
419,899,829 420,235,707
531,918,650 521,466,518
~ Tanweer Ahmed K.halfay Chief Financial Officer
The attached notes 1 to 14 form part ofthis interim condensed consolidated financial information. 2
30 September 2015 KD
20,181,980 17,451,740 24,176,610
61,810,330
1,250,000 204,835,406 76,564,008
108,549,611 69,220,623
460,41 9,648
522,229,978
27,009,694
27,009,694
8,034,821 66,150,388
74,185,209
10 I ,194,903
109,919,258 16,412,430 16,290,728
( I 0,944,265) 37,194
L 15,727,498 8,770,294
64,953,909
321,167,046 99,868,029
421,035,075
522,229,978
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~§.QR..l!B INTERIM CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) For the period ended 30 September 2016
Three months ended Six months ended 30 Sep_tember 30 Sep_tember
1016 2015 1016 2015 Notes KD KD KD KD
Sales 37,778,035 39,462,709 77,916,549 82,238,319 Cost of sales (22,432,242) (25,988,134) (45,797,141) (54,164,974)
GROSS PROFIT 15,345,793 13,474,575 32,119,408 28,073,345 Dividend income 26,491 287,769 336,803 332,611 Interest and other income 99,442 102,559 352,393 253,169 Realised gain on sale of financial assets available for sale 35,606 144,846 54,590
Share of results of associates 4,140,136 2,071,280 7,655,644 5,775,110 General and administrative expenses (10,153,859) (10,335,038) (21,389,627) (21,216,212) Finance costs (208,292) (438,774) (632,757) (833,971) Foreign exchange gain (loss) 30,182 (37,365) 32,192 (89,524)
Profit before provision for taxation and board of directors' remuneration 9,315,499 5,125,006 18,618,902 12,349,118
Provision for taxation 7 (155,974) (46,284) (312,985) (195,458) Board of directors' remuneration (37,500) (37,500) (75,000) (75,000)
Profit for the period 9,122,025 5,041,222 18,230,917 12,078,660
Attributable to: Shareholders of the Parent Company 5,507,284 2,386,552 10,487,657 6,611,666 Non-controlling interests 3,614,741 2,654,670 7,743,260 5,466,994
9,122,025 5,041,222 18,230,917 12,078,660
Basic and diluted earnings per share attributable to shareholders of the Parent Company 8 5.29 fils 2.28 fils 10.08 fils 6.31 fils
The attached notes 1 to 14 form part of this interim condensed consolidated financial information. 3
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~gy:~~ INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) For the period ended 30 September 2016
Three months ended Six months ended 30 Sep_tember 30 Sep_tember
2016 2015 2016 2015 KD KD KD KD
Profit for the period 9,122,025 5,041,222 18,230,917 12,078,660
Other comprehensive income: Other comprehensive (loss) income for the period that are or maybe subsequently reclassified to interim condensed consolidated statement of income: Financial assets available for sale: - Net changes in fair value of financial assets
available for sale (26,714) {803,251) 19,599 (563,822) - Net gain on sale of fmancial assets available for
sale transferred to interim condensed consolidated statement of income (35,606) (144,846) (54,590)
Changes in associates reserves (166,004) (45,759) (807,566) 525,190 Exchange differences arising on translation of foreign
operations (712,794) 399,318 (470,305) 1,946,493 Net loss on hedge of net investment in foreign
operation 83,341 (48,212) (182,173) (320,678)
Net other comprehensive (loss) income for the period that are or maybe subsequently reclassified to interim condensed consolidated statement of income (857,777) (497,904) (1,585,291) 1,532,593
Other comprehensive loss for the period not to be reclassified to interim condensed consolidated statement of income in subsequent periods:
Asset revaluation reserve (56,958)
Net other comprehensive loss for the period not to be reclassified to interim condensed consolidated statement of income in subsequent periods (56,958)
Other comprehensive (loss) income for the period (857,777) (497,904) (1,585,291) 1,475,635
Total comprehensive income for the period 8,264,248 4,543,318 16,645,626 13,554,295
Attributable to: Shareholders of the Parent Company 5,012,133 1,553,788 9,514,470 7,076,422 Non-controlling interests 3,252,115 2,989,530 7,131,156 6,477,873
8,264,248 4,543,318 16,645,626 13,554,295
The attached notes 1 to 14 form part of this interim condensed consolidated financial information. 4
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries i''"'"' fJQ'OR"AiN . ~~~ INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED) For the period ended 30 September 2016
Foreign Cumulative currency Non-
Statutory Voluntary Treasury Other changes in translation Retained controlling Share capital reserve reserve shares reserves fair values reserve earnings Sub-total interests Total equity
KD KD KD KD KD KD KD KD KD KD KD
As at 1 April2016 (audited) 109,919,258 18,983,391 18,861,689 (11,825,036) 124,329 91,388,257 8,833,758 77,915,147 314,200,793 106,034,914 420,235,707
Profit for the period - - - - - - - 10,487,657 10,487,657 7,743,260 18,230,917 Other comprehensive loss - - - - - (355,985) (617,201) - (973,186) (612,105) (1,585,291)
Total comprehensive (loss) income for the period - - - - - (355,985) (617,201) 10,487,657 9,514,471 7,131,155 16,645,626
Dividends payable to non-controlling interests - - - - - - - - - (6,571,987) (6,571,987)
Dividends (Note 12) - - - - - - - (10,401,792) (10,401,792) - (10,401,792) Ownership changes in a subsidiary - - - - 3,522 - - - 3,522 (11,247) (7,725)
As at 30 September 2016 109,919,258 18,983,391 18,861,689 (11,825,036) 127,851 91,032,272 8,216,557 78,001,012 313,316,994 106,582,835 419,899,829
As at 1 Apri12015 (audited) 109,919,258 16,412,430 16,290,728 ( 1 0,094,908) 70,987 116,245,079 7,730,999 68,827,897 325,402,470 98,961,521 424,363,991
Profit for the period - - - - - - 6,611,666 6,611,666 5,466,994 12,078,660 Other comprehensive (loss) income - - - - (56,958) (517,581) 1,039,295 - 464,756 1,010,879 1,475,635
-Total comprehensive (loss) income for the period - - - - (56,958) (517,581) 1,039,295 6,611,666 7,076,422 6,477,873 13,554,295
Dividend payable to non-controlling interests - - - - - - - - - (5,571,365) (5,571,365) Ownership changes in a subsidiary - - - 23,165 - - - 23,165 - 23,165 Purchase of treasury Shares - - - (849,357) - - - - (849,357) - (849,357) Dividends (Note 12) - - - - - - - (10,485,654) (10,485,654) - (10,485,654)
-As at 30 September 2015 109,919,258 16,412,430 16,290,728 ( 1 0,944,265) 37,194 115,727,498 8,770,294 64,953,909 321,167,046 99,868,029 421,035,075
The attached notes 1 to 14 form part of this interim condensed consolidated financial information.
5
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~9Q.fi1JN INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) For the period ended 30 September 2016
OPERATING ACTIVITIES Profit before tax and director's remuneration Adjustments for:
Depreciation and amortization Realised gain on sale of fmancial assets available for sale Gain on disposal of property, plant and equipment Share of results of associates Provision for employees' end of service benefits Finance costs
Working capital adjustments:
Trade and other receivables Inventories Trade and other payables
Cash generated from operations Employees' end of service benefits paid
Net cash flows generated from operating activities
INVESTING ACTIVITIES Net movement of financial assets available for sale Purchase of property, plant and equipment Purchase of investment in associate Sale proceeds from disposal of property, plant and equipment Purchase of additional investment in a subsidiary Dividend received from associates
Net cash flows used in investing activities
FINANCING ACTIVITIES Dividends paid Net movement in term loans Purchase of treasury shares Payment of finance costs Dividend to non-controlling interest of a subsidiary Movement in non-controlling interest
Net cash flows used in financing activities
Effect of foreign currency translation Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
Note
4
Six months ended 30 September
2016 2015 KD KD
18,618,902 12,349,118
4,068,329 4,058,283 (144,846) (54,590)
(46,060) (7,655,644) (5,775,110)
989,851 837,401 632,757 833,971
16,463,289 12,249,073
1,491,988 159,319 1,155,374 4,870,921 3,024,584 (890,704)
22,135,235 16,388,609 (246,073) (205,229)
21,889,162 16,183,380
(5,882,036) (450,040) (3,550,675) (1,947,939) (1, 760,951) (23,371)
67,668 (7,725)
751,775 1,353,935
(10,381,944) (1,067,415)
(8,627,050) (8,725,562) (3,005,825) (5,253,800)
(849,357) (632,759) (539,204)
(6,268,777) (5,571,365) (45,487) (43,783)
(18,579,898) (20,983,071)
(47,753) (156,551) (7,120,433) (6,023,657) 35,460,196 26,205,637
28,339,763 20,181,980
The attached notes 1 to 14 form part of this interim condensed consolidated financial information. 6
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~gQfiAIN NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at 30 September 2016
1 GENERAL INFORMATION
Qurain Petrochemical Industries Company K.S.C.P. (the "Parent Company'') is a Kuwaiti shareholding company established by Amiri Decree No 332/2004 on 10 November 2004. The Parent Company's shares were issued for public subscription by the Ministerial Decree No. 347/2004 on 28 November 2004. The Parent Company's shares are listed on the Kuwait Stock Exchange.
The Parent Company's objectives are as follows:
• To manufacture all types of chemical and petrochemical materials and any other derivatives. • To sell, purchase, supply, distribute, export and store these materials and participate in all the activities relating to the
same including the establishment and lease of the necessary services. • To participate in Equate Petrochemical Company K.S.C. (Closed), Kuwait Aromatics Company K.S.C. (Closed),
Kuwait Styrene Company K.S.C. (Closed) and Kuwait Olefins Company K.S.C. (Closed). • To contribute in industrial companies as well as fmance, manage and trade in its shares. • To develop industrial and craft zones and projects launched by the State or private sector. • To establish industrial projects or contribute therein after obtaining the necessary approvals from the Public Authority
for Industry and the concerned authorities.
The Parent Company may pursue the above mentioned activities in the State of Kuwait and abroad, originally or by proxy. It may have an interest in or participate in any manner with entities that carry on business activities similar to its own or which may assist the Parent Company in realising its objectives in Kuwait or abroad, and it may buy or otherwise acquire such companies.
The address of the Parent Company's registered office and principal place of business is: 26th Floor, KIPCO Tower, Khalid Bin Al Waleed Street, Sharq, P.O. Box No 29299, Safat 13153, State of Kuwait.
The interim condensed consolidated financial information of the Parent Company and subsidiaries (collectively the "Group") for the six months period ended 30 September 2016 was autho~ised for issue in accordance with a resolution of the Board of Directors on 27 October 2016.
The new Companies Law No. 1 of2016 was issued on 24 January 2016 and was published in the Official Gazette on 1 February 2016 cancelled the Companies Law No 25 of2012, and its amendments. According to article No.5, the new Law will be effective retrospectively from 26 of November 2012. The new Executive Regulations of Law No. 1 of2016 was issued on 12 July 2016 and was published in the Official Gazette on 17 July 2016 which cancelled the Executive Regulations of Law No. 25 of2012.
2 BASIS OF PREPARATION
The interim condensed consolidated financial information of the Group has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting".
The interim condensed consolidated financial information does not contain all information and disclosures required for full consolidated financial statements prepared in accordance with International Financial Reporting Standards ("IFRS") and should be read in conjunction with the Group's consolidated fmancial statements for the year ended 31 March 2016. In the opinion of the Parent Company's management, all adjustments consisting of normal recurring accruals considered necessary for a fair presentation have been included. Operating results for the six months period ended 30 September 2016 are not necessarily indicative of the results that may be expected for the financial year ending 31 March 2017. The interim condensed consolidated fmancial information is presented in Kuwaiti Dinars ("KD").
The accounting policies used in the preparation of this interim condensed consolidated financial information are consistent with those used in the preparation of the annual consolidated financial statements for the year ended 31 March 2016, except for the adoption of the amendments and annual improvements to IFRSs, relevant to the Parent Company which are effective for annual reporting period starting from 1 April 2016 and did not result in any material impact on the accounting policies, financial position or performance of the Parent Company.
The Group has not early adopted any other standards, interpretations or amendments that has been issued but is not yet effective.
7
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~§Q:"RAIN NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at 30 September 2016
3 ESTIMATES AND JUDGEMENTS
The preparation of interim condensed consolidated financial information requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing this interim condensed consolidated financial information, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 31 March 2016.
4 CASH AND CASH EQUIVALENTS (Audited)
30 September 31 March 30 September 2016 2016 2015 KD KD KD
Cashin hand 758,783 729,047 1,512 Cash at banks 9,631,565 22,364,466 17,636,011 Cash in portfolios 343,412 177,850 936,235 Short term deposits 25,075,711 12,188,833 1,608,222
35,809,471 35,460,196 20,181,980 Less: Bank overdraft (7,469,708)
Cash and cash equivalents for the purpose of interim condensed consolidated statement of cash flows 28,339,763 35,460,196 20,181,980
5 FINANCIAL ASSETS AVAILABLE FOR SALE (Audited)
30 September 31 March 30 September 2016 2016 2015 KD KD KD
Quoted equity securities 13,100,867 5,647,973 5,825,875 Debt instruments 5,771,118 7,742,123 6,653,750 Unquoted equity securities 166,998,788 166,998,838 192,355,781
185,870,773 180,388,934 204,835,406
6 TREASURY SHARES (Audited)
30 September 31 March 30 September 2016 2016 2015 KD KD KD
Number of treasury shares 59,095,913 59,095,913 54,212,536 Percentage of issued shares 5.38% 5.38% 4.93% Weighted average cost 11,825,036 11,825,036 10,944,265 Market value (KD) 11,700,991 11,346,415 9,758,256
An amount equivalent to the cost of purchase of the treasury share have been ear marked as non-distributable from voluntary reserve throughout the holding period of treasury shares.
8
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~~QfiAIN NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at 30 September 2016
7 PROVISION FOR TAXATION
Contribution to Kuwait Foundation for Advancement of Science "KF AS")
National Labour Support Tax (''NLST") Zakat
Three months ended 30 September
2016 2015 KD KD
11,739 123,836 20,399
155,974
5,134 58,794
(17,644)
46,284
8 BASIC AND DILUTED EARNINGS PER SHARE
Six months ended 30 September
2016 2015 KD KD
25,619 244,897 42,469
312,985
9,497 162,231 23,730
195,458
Basic and diluted earnings per share is computed by dividing the profit for the period attributable to the shareholders of the Parent Company by the weighted average number of shares outstanding less treasury shares for the period as follows:
Profit for the period attributable to the shareholders of the Parent Company
Weighted average number of shares outstanding Weighted average number of treasury shares
Weighted average number of shares for basic and
Three months ended 30 September
2016 2015 KD KD
5,507,284 2,386,552
Shares Shares
1,099,192,576 1,099,192,576 (59,095,913) (52,107,571)
Six months ended 30 September
2016 2015 KD KD
10,487,657
Shares
1,099,192,576 (59,095,913)
6,611,666
Shares
1,099,192,576 (51,117,125)
diluted earnings per share 1,040,096,663 1,047,085,005 1,040,096,663 1,048,075,451
Basic and diluted earnings per share attributable to the shareholders of the Parent Company 5.29flls 2.28 fils 10.08 fils
As there are no potentially dilutive instruments, basic and dilutive earnings per share are the same.
9 RELATED PARTY BALANCES AND TRANSACTIONS
6.31 fils
Related parties primarily comprise major shareholders, associates, directors, key management personnel and entities controlled, jointly controlled or significantly influenced by such parties. Pricing policies and terms of these transactions are approved by the Group's management. Transactions between the group entities have been eliminated on consolidation and are not disclosed in this note.
Balances and transactions with related parties included in the interim condensed consolidated financial information are as follows:
(Audited) 30 September 31 March 30 September
Associates Others 2016 2016 2015 KD KD KD KD KD
Interim condensed consolidated statement of financial position:
Trade and other receivables 1,767 46,000 47,767 51,572 57,110 Due from a related party 1,250,000 1,250,000 1,250,000 1,250,000
9
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~<SORATN NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at 30 September 2016
9 RELATED PARTY BALANCES AND TRANSACTIONS (continued)
Amount due from a related party does not carry interest and is repayable on demand.
Interim condensed consolidated statement of income: Interest and other income
Compensation of key management personnel
Associates KD
Others KD
67,050
Su months ended 30 September
2016 2015 KD KD
67,050 29,940
The remuneration of directors and other members of key management during the period were as follows:
Salaries and other short term benefits Employees' end of service benefits
Three months ended 30 September
2016 2015 KD KD
372,894 403,019 42,516 39,564
415,410 442,583
10 HEDGE OF NET INVESTMENT IN FOREIGN OPERATIONS
Su months ended 30 Sep_tember
2016 2015 KD KD
773,373 844,651 79,905 66,004
853,278 910,655
Term loans amounting to US Dollar 208,354,147 (31 March 2016: US Dollar 218,354,146 and 30 September 2015: USD 192,854,147) have been designated as a hedge of the net investment in the Group's subsidiary, Saudia Dairy and Food Stuff Company S.S.C. This borrowing is being used to hedge the Group's exposure to the US Dollar ("USD") foreign exchange risk on this investment. Gains or losses on the retranslation of this borrowing are transferred to interim condensed consolidated statement of comprehensive income to offset any gains or losses on translation of the net investments on the basis that the SARis pegged against the US Dollars. There is no significant ineffectiveness during the period ended 30 September 2016.
11 CONTINGENT LIABILITIES AND COMMITMENTS
As at 30 September 2016, the Group has a contingent liability amounting to KD 797,542 (31 March 2016: KD 12,719,852 and 30 September 2015: KD 13,156,694) in connection with certain guarantees and credit facilities availed from which the management is not expecting any material liabilities to arise. At 30 September 2016, the Group has outstanding commitments for future capital expenditure amounting to KD 5,271,944 (31 March2016: KD 5,744,140 and 30 September 2015: KD 3,917,345).
12 ANNUAL GENERAL ASSEMBLY MEETING
The Annual General Assembly of shareholders held on 21 June 2016 approved the audited consolidated financial statements of the Group for the year ended 31 March 2016 and approved a cash dividend of 10 fils per share amounting to KD 10,401,792 (31 March 2015: KD 10,485,654).
13 SEGMENT REPORTING
For management reporting purposes, the Group is organised into three major operating segments based on internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is the person responsible for allocating resources to and assessing the performance of the operating segments has been identified as the Parent Company's board of directors. The Group does not have material inter-segment transactions.
10
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~gQ.fiAIN NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at 30 September 2016
13 SEGMENT REPORTING (continued)
The principal activities and services under these segments are as follows:
Investments Investments are mainly for the long term and are in the petrochemical sector.
Mainly manufacture and supply of dairy and foodstuff. Foodstuff and manufacturing
Manufacturing Mainly manufacture and supply of chemicals for fiberglass, paint and petrochemical industries and general use.
Management monitors operating segments separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on segmental return on investments.
The following table presents information regarding the Group's operating segments:
Segment revenue
Segment expenses Unallocatetl expenses
Total expenses
Segment profit (loss) for the period
Segment assets
Segment liabilities
Segment assets
Segment liabilities
Segment revenue
Segment expenses Unallocated expenses
Total expenses
Segment profit (loss) for the period
Segment assets
Segment liabilities
Investments KD
8,389,404
(2,542,389)
(2,542,389)
5,847,015
384,885,332
81,873,828
Investments KD
381,496,778
76,403,705
Investments KD
6,372,535
(2,973,221)
{2,973,221)
3,399,314
394,486,861
77,249,492
11
Six months ended 30 September 2016 Manufacturing Foodstuff
KD KD
1,191,657 76,825,174
(1,270,910) (63,974,034)
(1,270,910) (63,974,034)
(79,253) 12,851,140
8,185,702 138,847,616
941,235 29,203,758
31 March 2016 (Audited) Manufacturing Foodstuff
KD KD
8,273,603 131,696,137
904,262 23,922,844
Six months ended 30 September 2015 Manufacturing Foodstuff
KD KD
1,421,418 80,859,846
(1,565,770) (71,765,690)
(1,565,770) (71,765,690)
(144,352) 9,094,156
8,351,125 119,391,992
791,844 23,153,567
Total KD
86,406,235
(67,787,333) (387,985)
(68,175,318)
18,230,917
531,918,650
112,018,821
Total KD
521,466,518
101,230,811
Total KD
88,653,799
(76,304,681) (270,458)
(76,575,139)
12,078,660
522,229,978
101,194,903
Qurain Petrochemical Industries Company K.S.C.P. and Subsidiaries ~~g~IN NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED) As at 30 September 2016
14 FAIR VALUE OF FINANCIAL INSTRUMENTS
Financial instruments comprise of fmancial assets and financial liabilities.
For fmancial assets and financial liabilities that are liquid or having a short-term maturity (less than three months), the carrying amount approximates their fair value. The fair values of other financial instruments, are not materially different from their carrying values.
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in orderly transactions between market participants at the measurement date. Fair values are obtained from quoted market prices, discounted cash flow models and other models as appropriate.
Fair value hierarchy The Group uses the following hierarchy for determining and disclosing the fair values of financial instruments by valuation technique:
Level 1: quoted (unadjusted) prices in an active market for identical assets and liabilities;
Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly; and
Level 3: other techniques which use inputs which have a significant effect on the recorded fair value are not based on observable market data.
30 September 1016
Financial assets available for sale: Quoted equity securities Unquoted equity securities
31 March 2016 (Audited)
Financial assets available for sale: Quoted equity securities Unquoted equity securities
30 September 2015
Financial assets available for sale: Quoted equity securities Unquoted equity securities
Levell KD
13,100,867
13,100,867
Levell KD
5,647,973
5,647,973
Levell KD
5,825,875
5,825,875
Level3 Total fair value KD KD
13,100,867 166,998,788 166,998,788
166,998,788 180,099,655
Level3 Total fair value KD KD
5,647,973 166,998,838 166,998,838
166,998,838 172,646,811
Level3 Total fair value KD KD
5,825,875 192,355,781 192,355,781
192,355,781 198,181,656
During the six months period ended 30 September 2016, there were no transfers between the hierarchies and there was no major movement in 1evel3.
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