ITTEHAD CHEMICALS LIMITED

ITTEHAD CHEMICALS LIMITED CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE HALF YEARD ENDED DECEMBER 31, 2012 (UN-AUDITED)

CONTENTS Corporate Information....................................................................................... 3 Directors’ Report................................................................................................. 4 Auditors’ Review Report.................................................................................... 5 Condensed Interim Balance Sheet..................................................................... 6 Condensed Interim Profit & Loss Account....................................................... 7 Condensed Interim Statement of Comprehensive Income.............................. 8 Condensed Interim Cash Flow Statement........................................................ 9 Condensed Interim Statement of Changes in Equity...................................... 10 Notes to the Condensed Interim Financial Statements................................... 11

Half Yearly Repor t December 3

20 2

Corporate Information BOARD OF DIRECTORS

Mr. Muhammad Siddique Khatri Mr. Abdul Sattar Khatri Mr. Abdul Ghafoor Khatri Ms. Farhana Abdul Sattar Khatri Mr. Fowad Yousaf Khatri Ms. Rushda Mustafa Mr. Waqas Siddiq Khatri

Chairman & Chief Executive Director Director Director Director Director Director

AUDIT COMMITTEE

Mr. Abdul Ghafoor Khatri Mr. Abdul Sattar Khatri Mr. Fowad Yousaf Khatri

Chairman Member Member

DIRECTOR FINANCE & CFO

Mr. Javed Iqbal

COMPANY SECRETARY

Mr. Wahee d Ashraf

REGISTERED OFFICE/HEAD OFFICE

39-Empress Road, P.O. Box 1414, Lahore-54000. Tel : 042 - 36306586 - 88 Fax : 042 - 36365697 www.ittehadchemic als.com E-mail: info@ittehadchemicals.com

PLANT

G.T. Road, Kala Shah Kaku, District Sheikhupura. Ph : 042 - 37950222 -25 Fax : 042 - 37950206

SHARE REGISTRARS

M/s. Corplink (Pvt.) Limited Corporate and Financial Consultants Wings Arcade, 1-K C ommercial, Model Town, Lahore. Ph: 042 - 35839182 Fax: 042 - 35869037

BANKERS TO THE COMPANY Askari Bank Limited Allied Bank Limited Al-Barka Bank(Pakis tan) Limited Burj BankLimited Faysal Bank Limited Habib Metro BankLimited KASB Bank Limited MCB Bank Limited National Bank of Pakistan Pak Libya Holding Co. (Pvt.) Limited Pakistan Kuwait Investment Co. (Pvt.) Limited Pak Brunei Investment Co. (Pvt.) Limited Standard Chartered Bank(Pakistan) Limited Summit Bank Limite d The Bank of Punjab United Bank Limited AUDITORS

M/s. BDO Ebrahim & Co., Chartered Accou ntants, 2nd Floor, Block-C, L akson Square Building No.1, Sarwar Shaheed Roa d, Karachi. Ph: 021-35683189-3 5683498 Fax: 021-356 84239

LEGAL ADV ISORS

M/s. Tahir Ali Tayebi & Co. 310, Marine Point, Schon Circle, Block 9, Clifton, Kara chi. Ph : 021-35370458 Fax : 021-35370459

Half Yearly Repor t December 3

20 2

Directors' Report The Directors of your Company take pleasure in presenting the un-audited condensed interim financial statements of t he Company for the half year ended December 31, 2012, together with Auditors' Review Report thereon. By the grace of Almighty Allah, your Company has performed wel l and succeeded to achieve 17% increase in sales revenue over the correspondingperiod of last year. During the period underreview, your Company has posted net sales of Rs. 2,127.980 million against the sal es of Rs. 1,825.071 million for the corresponding period of last year. This increase in sales is mainly due to revision i n selling prices of the products as well as better availability of gas supply during the period under rev iew. The gross profit has increased by 116% over the corresponding period and amounts to Rs.536.513 million. The profit after tax is recorded at Rs.217.507 million, as against loss after tax of Rs. 21.890 milli on for the corresponding period of last year, reflecting a tremendous increase of 1,094%. As a consequence the earnings per share (EPS) for the period stands at Rs. 6.04.Thisis indicativeof the management's efforts for improv ing sales and minimizingthecosts. The coal gasifier plant has become operational, consequently, it helped us to overcome steam production constraintsduringthe gas load-shedding period,which has resultantly increased the Company's profitability. The key financial figuresof the company for thehalf yearended December 31,2012 are as follows:

Net Sales Gross Profit Operating Profit Profit / (Loss) before Tax Profit / (Loss) afterTax Earnings / (Loss) PerShare (Rupees)

Half Yearended December31 2012 2011 ------Rupeesi nMillion----2,127.980 1,825.071 536.513 248.368 339.712 79.144 269.632 (32.133) 217.507 (21.890) 6.04 (0.61)

Increase %age 17% 116% 329% 939% 1,094% 1,090%

Looking forward, despite the challenges being faced in the country, ourfocus will be to remain profi tabl e on theexistingli nes of business with the ulti mate objecti veof increasingshareholders' valuein longterm. On October 03, 2012 the Honorable Lahore High Court approved the Scheme of Arrangement for merger / amalgamation of Chemi Chloride Indust ries Limi ted (CCIL), the wholly owned Subsidiary Company with and into Ittehad Chemicals Limited (ICL),the Hol ding Company with effect from October 03, 2012. Consequently, CCIL has been merged with and into ICL and the financi al statements have been prepared accordingly. We appreciate the Company's staff for thei r continuous dedication and support. We also express our gratit ude to our shareholders,bankers,customersand suppliers forthei rcontinued support and cooperation for the progress and prosperity of theCompany. On behalf of the Board

February 20, 2013 Lahore

Half Yearly Report December 3

20 2

MUHAMMAD SIDDIQUE KHATRI CHIEF EXECUTIVE

Independent Auditors' Report on Review of Condensed Interim Financial Information to the Members Introduction We have reviewed the accompanying condensed interim balance sheet of ITTEHAD CHEMICALS LIMITED (the "Company") as at December 31, 2012 and the rel ated condensed interim profit and loss account, condensed interim statement of comprehensive income, condensed interim cash flow statement, condensed interim statement of changes in equity and notes to the accounts for the six-month period then ended (here-in-after referred as "interim financial information"). Management is responsible for the preparati on and presentati on of this interim fi nancial information in accordance with approved accounting standards as applicable in Pakistan. Our responsibility is to express a conclusion on this interim financial information based on ourreview. Scopeof review We conducted our review in accordance with International Standard on Review Engagement s2410,"Review of Interim Financial Information Performed by the Independent Audi tor of the Enti ty." A review of interim financial information consists of making i nquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substanti ally 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 expressan audit opinion. Conclusion Based on our review, nothing has come to our attention t hat causes us to believe that the accompanying interim financial information as at and for the six months peri od ended December 31, 2012 is not prepared, in all material respects,in accordancewith approved accounting standards as appl icable in Pakistan. The figures for the quarter ended December 31, 2012 and December 31, 2011 in t he condensed interim profit and loss account and condensed interim statement of comprehensive income have not been reviewed and we do not express a conclusion onthem.

BDO Ebrahim & Co. Karachi Dated: February 20, 2013

Chartered Accountants Engagement Partner: Zulfikar Ali Causer

Half Yearly Repor t December 3

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Condensed Interim Balance Sheet (Un-audited) as at December 31, 2012

ASSETS NON CURRENT ASSETS Property, plant and equipment Operating f ixed assets Capital work in progress

December 31, June 30, 2012 2012 (Un-audite d) (Audited) Note (Rupees in thousand)

7 8

2,453,862 69,968 2,523,830 218 6,445 71,100 37,622 2,639,215

2,514,774 42,942 2,557,716 121 6,445 71,100 37,622 2,673,004

458,185 259,125 554,594 58,467 5,744 18,984 38,796 152,199 1,546,094 4,185,309

390,733 171,629 545,363 28,676 6,089 10,355 50,125 12,776 130,406 1,346,152 4,019,156

9.1

750,000

9.2

360,000 957,110 1,317,110 760,819

360,000 793,603 1,153,603 760,819

10 11 12

119,861 323,144 443,005

165,835 83,333 38,889 357,819 645,876

700,342 26,982 524,889 346,052 66,110 1,664,375 4,185,309

613,433 37,911 445,758 361,756 1,458,858 4,019,156

Intang ible assets Goodwill Inv estment property Long term investments Long term deposits CURRENT ASSETS Stores, spares and loose tools Stoc k in trade Trade debts Loans and adv ances Trade deposits and short term prepayments Other receivables Tax refunds due from Government Taxation - net Cash and bank balances TOTAL A SSETS EQUITY AND LIA BILITIES SHA RE CAPITAL AND RESERVES Authorized share capital Issued, subscribed and paid up capital Unappropriated Profit SURPLUS ON REVALUATION OF FIXED ASSETS NON CURRENT LIABILITIES Long term f inancing Long term diminishing musharaka Long term murabaha Deferred liabilities CURRENT LIABILITIES Trade and other pay ables Mark- up accrued Short term borrowings Current portion of long term liabilities Taxation - net CONTINGENCIES AND COMMITMENTS TOTAL EQUITY AND LIA BILITIES

The annexed notes from 1 to 19 form an integral part of these f inancial statements.

Half Yearly Report December 3

20 2

CHIEF EXECUTIVE

DIRECTOR

Condensed Interim Profit And Loss Account (Un-audited) for the h alf year ended December 31, 2012

Half year ended D ece mber 31, Quarter ended Dece mber 31, 201 2 201 1 201 2 201 1 ... .... ..... ....(Rupee s in thous and) ... .... ..... .... Note Sales - net Cost of sales Gross profit Selling anddistribution expenses General andadministrative expenses Other operating expenses Other operating income

Operating profit Financial charges Profit / (loss) before taxation Taxation Profit / (loss) after taxation Earnings per share - basic and diluted (Rupees)

2,127,980 (1,591,467) 536,513 (117,659) (68,900) (19,988) 9,746 (196,801) 339,712 (70,080) 269,632 (52,125) 217,507

1,825,071 (1,576,703) 248,368 (112,738) (59,525) (1,063) 4,102 (169,224) 79,144 (111,277) (32,133) 10,243 (21,890)

1,057,827 (823,184) 234,643 (63,084) (33,575) (7,501) 7,428 (96,732) 137,911 (34,583) 103,328 (7,869) 95,459

923,358 (826,788) 96,570 (56,796) (32,302) 426 2,697 (85,975) 10,595 (53,876) (43,281) 16,618 (26,663)

6.04

(0.61)

2.65

(0.74)

The annexed notes from 1 to 19 form an integral p art of these financial statements.

CHIEF EXECUTIVE

DIRECTOR

Half Yearly Repor t December 3

20 2

Cond ensed Interim Statement o f Comprehensive Income (Un-audited) for the half year ended December 31, 2012 Half year ended D ece mber 31, Quarter ended Dece mber 31, 201 2 201 1 201 2 201 1 ... .... ..... .... (Rupee s in thous and) ... .... ..... .... Profit / (loss) for the period Other comprehensive income for the period Total comprehensive income / (loss) for the period

217,507

(21,890)

95,459

(26,663)

217,507

(21,890)

95,459

(26,663)

The annexed notes from 1 to 19 form an integral p art of these financial statements.

Half Yearly Report December 3

20 2

CHIEF EXECUTIVE

DIRECTOR

Condensed Interim Cash Flow Statement (Un-audited) for the half year ended December 31, 2012 Half ye ar e nde d December 31, 2012 2011 (Rupees in thousand)

CASH FLOW FROM OPERATI NG ACTIVITIES Profit / (loss) before taxation Adjustments for items not involving movement of funds: Depreciation Amortization of intangible assets Provision for gratuity Gain on sale of fixed assets Gain on foreign exchange Bad debts writtenoff Financial charges Net cashflow before working capital changes Decrease / (increase) incurrent assets Stores, spares andloose tools Stock in trade Trade debts Loans and advances Trade deposits andshort term prepayments Other receivables Tax refunds due from the Government

269,632

(32,133)

92,647 93 5,281 (6,688) (1,268) 741 70,080 430,518

94,083 66 2,840 (149) (1,537) 2,796 111,277 177,243

(67,452) (87,496) (8,704) (29,791) 345 (8,629) (18,737) (220,464)

(16,787) 46,678 (55,452) (4,840) 3,060 (13,871) (41,212)

(Decrease) / increase incurrent liabilities Trade and other payables Cashgenerated from operations Income taxes paid Gratuity paid Financial charges paid Net cashinflow fromoperating activities

80,519 290,573 18,076 (1,205) (81,009) 226,435

229,386 365,417 (25,024) (606) (118,004) 221,783

CASH FLOW FROM INVESTING ACTIVITIES Additions to operating fixed assets - net Additions to capital work in progress Additions to intangible assets Proceeds from sale of operating fixed assets Long term deposits Net cash(used in) investing activities

(24,396) (54,726) (190) 27,048 (52,264)

(2,213) (72,303) 160 (2,340) (76,696)

(61,678) (83,333) (38,889) (47,609) 79,131 (152,378) 21,793 130,406 152,199

(56,685) (83,334) (38,888) (17,994) 52,369 (144,532) 555 117,434 117,989

CASH FLOW FROM FINANCING ACTIVITIES Repayment of long term financing Repayment of long term diminishing musharaka Repayment of long term murabaha Dividend paid Short term borrowings Net cash(outflow) from financing activities Net increase incash and cash equivalents Cashand cash equivalents at the beginning of the period Cashand cash equivalents at the end of the period The annexed notes from 1 to 19 form an integral part of these financial statements.

CHIEF EXECUTIVE

DIRECTOR

Half Yearly Repor t December 3

20 2

Condensed Interim Statement of Changes in Equity (Un-audited) for the half year ended December 31, 2012 Unappropriate d Total profit --------------- (Rupees in thous and) ---------------

Share Capital

Balance as at July 01, 20 11

360 ,000

651 ,100

1,011 ,100

Final cash dividend 20 11: Re. 0.50 p er sh are

(18,000 )

Total Comprehens ive (loss) for th e p eriod

(21,890 )

360 ,000

611 ,210

971 ,210

Transfer from surplus on revalu ation of fixed assets on account of disposal of freehold lan d

642

Total Comprehens ive income for the p eriod

181 ,751

360 ,000

793 ,603

1,153 ,603

Final cash dividend 20 12: Re. 1.50 p er sh are

(54,000 )

Total Comprehens ive loss for th e p eriod

217 ,507

360 ,000

957 ,110

1,317 ,110

Balance as at December 31, 2011

Balance as at June 30, 2012

Balance as at December 31, 2012

The annexed notes from 1 to 19 form an in tegral p art of th ese financial state ments.

Half Yearly Report December 3

20 2

CHIEF EXECUTIVE

DIRECTOR

Notes to the Condensed Interim Finan cial Statements (Un-audited) for the half year ended December 31, 2012 1

LEG AL STATUS AND NATURE OF BUSINESS Itte had Chemicals Limited (th e Company) was in corporated on September 2 8, 1 991 to takeover th e as sets of Ittehad Chemicals and Itte had Pesticides u nder a Scheme of Arrangement d ated June 18, 199 2 as a re sult of which the Compan y be came a wh olly own ed su bsidiary of Fede ral Ch emical an d Ceramics Corporation (P rivate) Limite d. The Comp any was privatized on July 0 3, 1995 whe n 90% of th e s hares were transferred to the b uyer. The Company was listed on K arachi Stock Exch ange on April 1 4, 200 3 when sp ons ors of th e Comp any offered 25% of the issued , sub scribed an d paid u p shares of the Compan y to the general pub lic. The registered office of the Company is s ituated at 39, Empress Road , Lah ore. The Compan y is engaged in the business of manufacturing and s ellin g caustic soda and oth er allied chemicals.

MERGER OF WHOLLY OWNED SUBSI DIARY The Honorable Lah ore High Cou rt approved th e Sch eme of Arrangement for me rger / amalgamation of Ch emi Chloride Industries Limited (CCIL) wholly owne d sub sidiary, with th e Compan y effective from October 03, 2 012. Consequently, CCIL has b een merged with the Company and these financial statements h ave b een prep ared in accordance with th e said merger scheme . As a result of merger of CCIL with the Company on the ab ove mention ed effective date, th e re sult of b oth entities have be en comb ined for the purp ose of p reparation of these finan cial statements. Sin ce the merger is between two companies un der common control, International Finan cial Reporting Stand ard IFRS 3 - Busin ess Combinations is n ot applicable. The financial statement items of the Company and CCIL for all pe riods presented are includ ed in these fin an cial statemen ts as if they had been combin ed from the b eginning of the earliest period prese nte d. Acord ingly, comparatives are restated and have b een extracte d from Company's audited financial s tatemen ts for the year en ded 30 Jun e, 2012.

BASI S OF PREPARATI ON

3.1 State ment of compliance Thes e condense d in terim financial statemen ts are unau dited b ut subject to limited scope review by auditors and are being s ubmitted to the sh areh olders as requ ired und er Section 245 of the Compan ies Ordinan ce, 19 84. Thes e condensed in terim fin ancial s tatemen ts of the Company for th e six months period ended Decemb er 31, 201 2 have been prepared in accordan ce with the req uire ments of International Accounting Standard - 34 "Interim Financial Reporting" an d provision s of and directives issue d un der the Comp anies Ord inance, 1984 . In cas e where requ irements differ, the provisions of or directives iss ued un der th e Companies Ord inance, 1 984 have been followed. The dis closures made in these conde nsed interim fin ancial statements have b een limited in accord ance with the requirements of International Accoun tin g Stand ard - 34 "Inte rim Financial Reportin g". They d o n ot inclu de all the information and d isclos ures made in the annu al pu blished financial state ments and sh ould be read in conjunction with the fin ancial statements of the Company for th e year end ed Ju ne 30, 20 12. 3.2 Basis of measure ment Thes e condensed interim financial stateme nts have been p re pared un der the historical cost convention, except for the recognition of certain staff retiremen t b enefits at present valu e. Thes e condensed interim financial s tatemen ts have b een p rep ared followin g accru al b asis of accounting except for cash flow information. 3.3 Functional and presentation curre ncy Thes e condensed in terim finan cial statements h ave b een p re sented in Pak Rup ees, which is the fu nction al an d presentation currency of the Comp an y.

Half Yearly Repor t December 3

20 2

SIGNIFICANT ACCOUNT ING POLICIES The accounting policies adopted and methods of computation followed in the p reparation of th ese condensed interim fin ancial statements are same as those ap plied for the preceding annu al fin ancial statements for th e year end ed June 3 0, 2012. Th e Followin g stan dards, amendments and in terp retations of approved accoun tin g standards became effective d uring the period , however, th ese d o n ot have a significant impact on the Comp any's cond ensed in terim finan cial statements: IAS 1 - P res entation of Finan cial Statemen ts IAS 12 - Income Taxes

TAXATI ON Income tax expense is recognized bas ed on management's b est estimate of the weighted average an nual income tax rate expected for the full finan cial year.

ESTIMATES The preparation of conde nsed interim finan cial statemen ts requires man age ment to make judgments, estimates and as sumptions th at affect the ap plication of accounting p olicies and th e reported amou nts of assets and liabilities, in come an d expens es. Actu al re sults may differ from thes e estimates. The sign ificant judgments made by man agemen t in ap plyin g th e Company's accoun tin g p olicies an d key sources of estimation of uncertain ty are the s ame as those th at were ap plied to th e fin an cial state ments for the year ended June 30 , 2 012.

OPERATING FIXED ASSETS

Note

Opening book value (N BV) Additions (at cost) du rin g the period / year Dis posals (at NBV) du rin g the period / year De pre ciation charged during th e period / year Closing net book value (NBV)

7.1 7.2

December 31, June 30, 2012 2012 (Un-audite d) (Audited) (Rupees in thousand) 2,51 4,774 5 2,095 2,56 6,869 (20,360 ) (92,647 ) (113,007 ) 2,45 3,862

2,49 8,639 26 6,633 2,76 5,272 (55,948 ) (194,550 ) (250,498 ) 2,51 4,774

7.1 Details of additions (at cost) during th e period / year are as follows: Land Building Plant and machinery Other equipment Furniture and fixtu res Office and other equipment Vehicles

3 1,664 4,725 584 7,491 7,631 5 2,095

1 2,902 691 23 5,942 6,805 220 5,393 4,680 26 6,633

1 7,046 49 3,265 2 0,360

1 2,000 4 3,329 619 5 5,948

7.2 Details of disposals (at N BV) during th e period / year are as follows: Land Plant and machinery Office and other equipment Vehicles

Half Yearly Report December 3

20 2

CAPITAL WORK IN PROG RESS P lant and machin ery I ntangible Assets

December 31, June 30, 2012 2012 (Un-audite d) (Audited) (Rupees in thousand) 66,468 3,500 69,968

39,442 3,500 42,942

8.1 An amount of Rs . 27 .700 million (Jun e 3 0, 2012: Rs . 23 6.148 million) has been tran sferred to operating fixed assets during the period. 9

SHARE CAPITAL

9.1 Authorized s hare capital 50,000,0 00 (June 3 0, 2012: 50 ,000,000 ) ordin ary shares of Rs. 10/ - each 25,000,0 00 (June 3 0, 2012: 25 ,000,000 ) preferen ce shares of Rs. 10/ - each

500, 000

250, 000 750, 000

1,00 0

249, 000

110, 000 360, 000

272,3 36 (55,678)

3 85,201 (112,8 65)

216,6 58

2 72,336

10,8 10 (6,000) 4,8 10

10,810 10,810

221,4 68 (1 01,607)

2 83,146 (117,3 11)

119,8 61

1 65,835

250,0 00 (83,333) 166,6 67 (1 66,667)

4 16,667 (166,6 67) 2 50,000 (166,6 67)

83,333

9.2 Iss ued, subscribed and paid up share capital 100,000 (June 30, 20 12: 100,0 00) ord inary s hare s of Rs. 10/- each fully paid in cas h 24,900,0 00 (Jun e 3 0, 2012: 24 ,900,00 0) ordin ary sh ares of Rs. 10/- e ach is sued for consideration other than cash 11,000,0 00 (Jun e 3 0, 2012: 11 ,000,00 0) fully p aid b onu s shares of Rs. 10/- each 10

LONG TERM FINANCING From banking companies an d fin an cial institutions - secu re d Balance as at July 01 Repayments mad e during the pe riod / ye ar From directors and others - uns ecured Balance as at July 01 Repayments mad e during the pe riod / ye ar

Current portion shown und er current liabilities 11

LONG TERM DIM INISH ING MUSHARAKA From banking companies an d fin an cial institutions - secu re d Balance as at July 01 Repayments mad e during the pe riod / ye ar Current portion shown und er current liabilities

Half Yearly Repor t December 3

20 2

December 31, June 30, 2012 2012 (Un-audite d) (Audited) (Rupees in thousand) 12

LONG TERM MURABAHA From banking companies - secured Balance as at July 01 Repayments mad e during the pe riod / ye ar

116,6 67 (38,889)

1 94,444 (77,7 77)

Current portion shown und er current liabilities

77,7 78 (77,778)

1 16,667 (77,7 78)

38,889

CONTI NGENCIES AND COMMI TMENTS

13. 1 Contingent liabilities a) The taxation auth oritie s have amen ded the d eeme d assess men t for tax year 2 006 by pas sing an orde r u /s 122 (5A) of the Income Tax Ordin ance, 2 001. Th e Company has challenged th e same b efore Commissioner Inland Revenue (Ap peals). The Company expect a favorable outcome of the proceedings. However, if the proceedings are finalized against th e Company, it may resu lt in tax payable of Rs. 19.9 64 million to the national exchequer. b)

The Company has received an as sessment ord er und er section 122(5) of th e Income Tax Ordinan ce, 20 01 for tax year 20 04 as a resu lt of which b rought forward los ses of the Company have decre as ed by Rs. 24.8 49 million (Ju ne 3 0, 201 2: Rs. 2 4.849 million). Th e Comp an y filed an app eal before Commissioner of Inland reve nue (Appeals) Zone-1 against the impugn ed ord er who h as given certain reliefs to the Company. Both the Company an d Income Tax Dep artment h as filed an app eal b efore Ap pellate Trib unal Inland Revenue. The Hon'ble ATIR (Ap pellate Trib unal Inland Reven ue) h as partially d ecide d th e case in Company's favour and partially remanded to the taxation officer for fres h proceedin gs . The Company expect a favorab le outcome of th e proceedings . However, if the proceedin gs are fin alized again st the Company, it may resu lt in tax payable of Rs. 3.11 4 million.

The Company has also received an order u nde r section 161/20 5 of th e In come Tax Ord in ance, 20 01 for tax ye ar 200 4 creatin g d emand of Rs. 12.069 million (Jun e 3 0, 2012: Rs. 12.069 million). Th e Company challenged it before Commis sioner of In lan d Revenu e (App eals) Zone-1 who d ecided th e case in favour of the Company. The in come tax dep artment has filed an ap peal b efore App ellate Tribun al Inland Revenu e. The Hon'ble ATIR h as reman ded the case b ack to the Commissioner Inlan d Revenu e (Ap peals) for p as sing a speaking order. However, if the proceedin gs are finalised again st th e Company, it may res ult in tax payable of Rs. 12.0 69 million .

The Company is facing claims, lodged in the labou r courts, p ertainin g to staff retirement b enefits . In the event of an adverse decision th e Company wou ld be requ ired to pay an amount of Rs . 4.422 million (Ju ne 30, 20 12: Rs . 2.882 million) against these claims.

Letters of guarantee outstandin g as at D ecember 3 1, 201 2 were Rs. 2 14.018 million (Ju ne 30 , 201 2: Rs . 208.92 million).

13. 2 Commitments Commitments as on December 31, 20 12 were as follows: a)

Against lette rs of cred it amoun ting to Rs. 42.861 million (Jun e 30, 2012 : Rs. 38 .241 million ).

Against purchas e of land amou nting to Rs. 1.8 38 million (Ju ne 30, 20 12: Rs 1.838 million).

Half Yearly Report December 3

20 2

December 31, June 30, 2012 2012 (Un-audite d) (Audited) (Rupees in thousand) c)

Ujrah payme nts und er Ijarah financin g agreement: Not later than one year Later than one year bu t not later th an five years

43,2 84 73,1 08

38,014 95,848

116,3 92

1 33,862

----------------- (Un-audite d) ----------------Half yeare nde d Decemb er 31, Q uarter end ed Dec em ber 31, 2012 2011 2012 2011 ----------------- (Rupees in thousand) ----------------14

COST OF SALES Raw materials consumed Other overheads: Stores, spares and con sumables Packing materials consu med Salaries , wages and other ben efits Fuel and power Repair and maintenan ce Rent, rates and taxes Ins urance Depreciation Vehicle running expe nses Pos tage, printing and stationery Other expenses Opening work in process Closing work in p roces s

Cost of goods man ufactured Cost of stores traded Opening stock of fin is hed goods Closing stock of finish ed good s

204 ,316

167 ,762

114 ,621

92,931

100 ,521 17 ,495 135 ,415 1,068 ,250 13 ,110 16 ,925 5 ,413 89 ,859 8 ,225 259 500

87 ,166 14 ,021 103 ,627 1,054 ,431 8 ,009 14 ,106 5 ,104 92 ,158 7 ,079 325 923

55 ,094 9 ,264 69 ,038 532 ,339 7 ,179 8 ,397 2 ,737 44 ,904 4 ,232 145 235

46,774 8,292 53,456 5 94,614 3,296 6,936 2,551 46,890 3,471 178 485

1,455 ,972

1,386 ,949

733 ,564

7 66,943

12 ,712 (13,327 )

11 ,449 (16,549 )

12 ,758 (13,327 )

12,371 (16,5 49)

(615 )

(5,100 )

(569 )

(4,1 78)

1,659 ,673

1,549 ,611

847 ,616

8 55,696

11 ,654

2 ,689

(5,453 )

2,278

92 ,983 (172,843 )

128 ,495 (104,092 )

153 ,864 (172,843 )

72,906 (104,0 92)

(79,860 )

24 ,403

(18,979 )

(31,1 86)

1,591 ,467

1,576 ,703

823 ,184

8 26,788

TRANSACTIONS WITH RELATED PARTIES The re lated parties comp ris e group compan ie s, othe r associated comp anies, staff retirement fun ds, directors and key management p ersonn el. Transactions with related parties and associate d und ertakings are given as under:

Half Yearly Repor t December 3

20 2

----------------- (Un-audite d) ----------------Half year ended December 31, Q uarter end ed Dec em ber 31, 2012 2011 2012 2011 ----------------- (Rupees in thousand) -----------------

Relati ons hip with the Company

Nature of trans action

Associated company

Marketing services ch arges

Associated company

Sale s of good and services

Retirement benefit plans

Contrib ution to staff retirement benefit plans

Key management personnel

Remune ration and other ben efits

16 ,527

14 ,296

8,464

139

123

34 ,931

32 ,560

15 ,674

15,453

217 ,507

(21,890 )

95 ,459

(26,6 63)

36 ,000

36,000

6 .04

(0.61 )

2.65

(0 .74)

EARNINGS PER SHARE - BASIC AND D ILUT ED Profit / (loss) after taxation (Rs. in thousand) Weighted ave rage nu mbe r of ordin ary shares - (in thousand ) Earnings pe r share - basic an d diluted - (Rs.)

14 ,296

NON ADJUSTING EVENTS The Board of Directors of th e Company has recommend ed a 5% inte rim cash divid end in their meetin g held on February 20, 2 013.

DATE OF AUTHORIZAT ION FOR ISSUE Thes e condens ed interim fin ancial statements were authorized for issue on February 20, 2013 b y the Board of Directors of the Company.

GENERAL Amounts have been rou nded off to th e nearest ru pees in thousan d unles s otherwise stated .

Half Yearly Report December 3

20 2

CHIEF EXECUTIVE

DIRECTOR