First Imrooz Modaraba : Transmission of Quarterly Accounts for the Period Ended March 31, 2024

QUARTERLY ACCOUNTS (UN-AUDITED) For the period ended March 31, 2024

Managed By

A R Management Services (Private) Limited

MODARABA INFORMATION

Modaraba Management Company	A R Management Services (Private) Ltd.
Directors of Modaraba Company	Mr. Naveed Riaz - Chief Executive
	Mrs. Saadat Ikram
	Mr. Ameed Riaz
	Mr. Omar Mohammad Khan
	Mr. Aliuddin Ahmed
Audit Committee	Mr. Aliuddin Ahmed (Chairman)
	Mr. Omar Mohammad Khan (Member)
	Mrs. Saadat Ikram (Member)
Human Resource Committee	Mr. Aliuddin Ahmed (Chairman)
	Mr. Omar Mohammad Khan (Member)
	Mrs. Saadat Ikram (Member)
	Mr. Ameed Riaz (Member)
Chief Financial Officer	Mr. Muhammad Ali Baig
Company Secretary	Mr. Shabbir Ahmed Jamsa
Chief Internal Auditor	Mr. Abbas Kerani
Auditors	M/s. BDO Ebrahim & Co.
	Chartered Accountants
Bankers	Soneri Bank Limited
	Bank Alfalah Limited
	Bank AL Habib Limited
	Faysal Bank Limited
Legal Advisors	Mr. Masood Aziz Advocate
	Masood Aziz & Associates
Shariah Advisor	Mufti Abdul Qadir
Principal place of business	Room No. 405, 4th Floor
	Beaumont Plaza, Beaumont Road
	Civil Lines Quarters, Karachi.
Registered Office of the Modaraba Company	125-S, Small Industrial Area
	Kot Lakhpat, Lahore.
Certificate Registration Office	F.D. Registrar Services (Pvt) Limited
	17th Floor, Saima Trade Tower-A
	I.I. Chundrigar Road, Karachi.

REPORT OF THE DIRECTORS

The Board of Directors of A R Management Services (Private) Limited, the management company of First Imrooz Modaraba would like to present to its certificate holders their report along with un-audited financial statements for the third quarter and nine months period ended March 31, 2024.

1. Key Financial Highlights
	(Rupees in million)
	Nine months ended
	31-Mar-24	31-Mar-23
Sales	936.27	1,317.50
Gross profit	204.20	8.68
Operating expenses	55.91	56.77
Profit / (Loss) for the period	78.15	(117.82)
Earnings per certificate - basic & diluted (Rupees)	26.05	(39.27)

1. Review of Operations
   Despite lower sales volume and value, the profitability is higher as compared to previous years corresponding nine months due to better margins and relatively stable exchange rates. The management foresees that the trend will continue, and we will close the year on a positive note.
2. Acknowledgement
   The Board wishes to express its thanks for continued guidance and support extended by the Registrar Modaraba and other officials of Securities and Exchange Commission of Pakistan. The Board also wishes to thank its certificate holders, colleagues, investors, bankers and business partners for their support.

For and on behalf of the Board

Naveed Riaz	Omar Mohammad Khan
Chief Executive	Director
April 29, 2024

31-Mar-2331-Mar-24

1,317.50936.27

8.68204.20

56.7755.91

(117.82)78.15

(39.27)26.05

CONDENSED INTERIM BALANCE SHEET

AS AT MARCH 31, 2024

		(Un-audited)	(Audited)
		March 31,	June 30,
		2024	2023
	Note	Rupees	Rupees
ASSETS
NON CURRENT ASSETS
Property and equipment		12,489,655	14,006,740
Intangible assets		1,007,824	1,398,496
Long term deposits		598,202	598,202
		14,095,681	16,003,438
CURRENT ASSETS
Stock in trade		302,586,115	378,194,924
Trade debtors		206,467,146	311,212,675
Advances, deposits, prepayments and other receivables		7,402,466	8,764,577
Taxation		11,807,168	16,728,957
Cash and bank balances		5,134,621	52,255,980
		533,397,516	767,157,113
TOTAL ASSETS		547,493,197	783,160,551
EQUITY AND LIABILITIES
CAPITAL AND RESERVES
Authorised capital
10,000,000 Modaraba certificates of Rs.10 each		100,000,000	100,000,000
Issued, subscribed and paid-up certificate capital		30,000,000	30,000,000
Statutory reserve		118,733,257	118,733,257
Revenue reserve		78,955,563	15,806,157
		227,688,820	164,539,414
NON CURRENT LIABILITY
Defined benefit plan - Staff gratuity		6,719,947	6,719,947
Obligation under financing facilities - Secured		965,340	1,422,655
		7,685,287	8,142,602
CURRENT LIABILITIES
Obligation under financing facilities - Secured		163,889,224	140,609,676
Qard-e-Hasana from Modaraba Management Company		26,500,000	-
Creditors, accrued and other liabilities		121,729,866	469,868,859
		312,119,090	610,478,535
TOTAL EQUITY AND LIABILITIES		547,493,197	783,160,551
CONTINGENCIES AND COMMITMENTS	3

The annexed notes from 1 to 4 form an integral part of these condensed interim financial information.

For A R Management Services (Private) Limited

(Modaraba Management Company)

NAVEED RIAZ	OMAR MOHAMMAD KHAN	AMEED RIAZ	MUHAMMAD ALI BAIG
CHIEF EXECUTIVE	DIRECTOR	DIRECTOR	CHIEF FINANCIAL OFFICER

CONDENSED INTERIM PROFIT AND LOSS ACCOUNT (UN-AUDITED)

FOR NINE MONTHS AND THIRD QUARTER ENDED MARCH 31, 2024

	Nine months ended	Third Quarter ended
	March 31,	March 31,	March 31,	March 31,
	2024	2023	2024	2023
		Rupees
Sales	936,274,396	1,317,504,817	327,431,922	612,887,488
Cost of sales	(732,074,913)	(1,308,826,740)	(259,346,417)	(682,255,566)
Gross Profit / (Loss)	204,199,483	8,678,077	68,085,505	(69,368,078)
Operating expenses	(56,399,368)	(56,769,971)	(17,985,533)	(16,193,032)
Operating Profit / (Loss)	147,800,115	(48,091,894)	50,099,972	(85,561,110)
Financial charges	(26,502,757)	(11,556,857)	(8,862,015)	(6,172,919)
Other income	362,806	1,637,535	29,810	227,087
Reversal for doubtful debts	-	2,372,411	-	-
	121,660,164	(55,638,805)	41,267,767	(91,506,942)
(Provision) / Reversal for Sindh Workers' Welfare Fund	(2,433,203)	-	(825,355)	717,363
Profit / (Loss) before taxation	119,226,961	(55,638,805)	40,442,411	(90,789,579)
Taxation	(41,077,555)	(62,183,286)	(15,660,685)	(25,652,545)
Profit / (Loss) for the period	78,149,406	(117,822,091)	24,781,727	(116,442,124)
Other comprehensive income	-	-	-	-
Total comprehensive income / (loss) for the period	78,149,406	(117,822,091)	24,781,727	(116,442,124)
Earnings per certificate - basic and diluted	26.05	(39.27)	8.26	(38.81)

The annexed notes from 1 to 4 form an integral part of these condensed interim financial information.

For A R Management Services (Private) Limited

(Modaraba Management Company)

NAVEED RIAZ	OMAR MOHAMMAD KHAN	AMEED RIAZ	MUHAMMAD ALI BAIG
CHIEF EXECUTIVE	DIRECTOR	DIRECTOR	CHIEF FINANCIAL OFFICER

CONDENSED INTERIM STATEMENT OF CASH FLOWS (UN-AUDITED)

FOR NINE MONTHS AND THIRD QUARTER ENDED MARCH 31, 2024

		Nine months ended	Third Quarter ended
		Mar 31,	Mar 31,	Mar 31,	Mar 31,
		2024	2023	2024	2023
			Rupees
A. CASH FLOWS FROM OPERATING ACTIVITIES
Profit / (Loss) before taxation		119,226,961	(55,638,805)	40,442,411	(90,789,579)
Adjustments for non-cash and other items:
Depreciation		2,907,491	2,035,027	982,440	689,877
Amortization on intangible assets	390,672	261,805	130,224	98,007
Amortization on Deferred Capital Grant	-	-	-	27,953
Gain on disposal of property and equipment	(355)	(1,203,499)	14,645	-
Financial charges		26,502,757	11,556,857	8,862,015	6,172,919
Provision for staff gratuity		-	451,110	-	150,370
Reversal for doubtful debts		-	(2,372,411)	-	-
		29,800,565	10,728,889	9,989,324	7,139,126
Operating profit / (loss) before working capital changes	149,027,526	(44,909,916)	50,431,735	(83,650,453)
Changes in operating assets and liabilities
Decrease / (Increase) in current assets
Stock in trade		75,608,809	128,991,538	(15,083,984)	342,478,935
Trade debtors		104,745,529	(365,743,644)	2,672,731	(352,847,950)
Advances, deposits, prepayments & other receivables	1,362,111	(24,306,811)	(4,977,817)	(11,085,740)
		181,716,449	(261,058,917)	(17,389,070)	(21,454,755)
(Decrease) / Increase in current liabilities
Creditors, accrued and other liabilities	(354,081,935)	334,689,932	(20,545,472)	77,365,811
Cash (used in) / generated from operating activities	(23,337,960)	28,721,099	12,497,194	(27,739,397)
Financial charges paid		(20,769,116)	(10,969,930)	(7,840,508)	(5,548,146)
Income tax paid		(36,155,766)	(75,220,662)	(11,342,177)	(34,747,284)
Gratuity paid		-	(6,618,982)	-	(3,318,366)
Net cash used in operating activities		(80,262,842)	(64,088,475)	(6,685,491)	(71,353,193)
B. CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment	(1,405,051)	(1,714,610)	(1,081,101)	(1,452,475)
Purchase of intangible assets		-	(773,198)	-	(773,198)
Proceeds from disposal of property and equipment	15,000	1,203,500	-	-
Net cash used in investing activities		(1,390,051)	(1,284,308)	(1,081,101)	(2,225,673)
C. CASH FLOWS FROM FINANCING ACTIVITIES
Dividend paid		(14,790,699)	(16,012,405)	(179,843)	(1,800)
Receipts of Qard-e-Hasana from Modaraba Management Company	218,500,000	305,500,000	45,500,000	128,000,000
Repayment of Qard-e-Hasana to Modaraba Management Company	(192,000,000)	(262,500,000)	(56,000,000)	(30,000,000)
(Repayment) / Receipts of Musharaka finances	22,822,233	(4,609,398)	15,726,208	9,834,219
Receipts of Musawamah finances		325,000,000	335,000,000	120,000,000	140,000,000
Repayment of Musawamah finances	(325,000,000)	(250,000,000)	(120,000,000)	(140,000,000)
Repayment of Salam finances		-	(1,376,727)	-	-
Net cash generated from financing activities	34,531,534	106,001,470	5,046,365	107,832,419
Net (decrease) / increase in cash and cash equivalent (A+B+C)	(47,121,359)	40,628,687	(2,720,227)	34,253,553
Cash and cash equivalent at the beginning of the period	52,255,980	5,020,220	7,854,848	11,395,354
Cash and cash equivalent at the end of the period	5,134,621	45,648,907	5,134,621	45,648,907
The annexed notes from 1 to 4 form an integral part of these condensed interim financial information.
	For A R Management Services (Private) Limited
	(Modaraba Management Company)
NAVEED RIAZ	OMAR MOHAMMAD KHAN	AMEED RIAZ		MUHAMMAD ALI BAIG
CHIEF EXECUTIVE	DIRECTOR	DIRECTOR	CHIEF FINANCIAL OFFICER

CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY (UN-AUDITED)

FOR NINE MONTHS AND THIRD QUARTER ENDED MARCH 31, 2024

			Revenue reserve
	Paid-up	Statutory	Unappropriated	Total
	certificate	reserve*
	profit
	--------------------------- (Rupees) ------------------------
Balance as at July 01, 2022	30,000,000	118,733,257	35,003,813	183,737,070
Transaction with owners
Profit distribution for the year ended June
30, 2022 @ Rs.5.50/- per certificate	-	-	(16,500,000)	(16,500,000)
Total comprehensive income
Loss for the period - Jul 2022 to Mar 2023	-	-	(117,822,091)	(117,822,091)
Other comprehensive income	-	-	-	-
	-	-	(117,822,091)	(117,822,091)
Balance as at March 31, 2023	30,000,000	118,733,257	(99,318,278)	49,414,979
Total comprehensive income
Profit for the period - Apr 2023 to Jun 2023	-	-	115,124,435	115,124,435
Other comprehensive income	-	-	-	-
Transfer to statutory reserve	-	-	-	-
Balance as at June 30, 2023	30,000,000	118,733,257	15,806,157	164,539,414
Transaction with owners
Profit distribution for the year ended June
30, 2023 @ Rs.5/- per certificate	-	-	(15,000,000)	(15,000,000)
Total comprehensive income
Profit for the period - Jul 2023 to Mar 2024	-	-	78,149,406	78,149,406
Other comprehensive income	-	-	-	-
	-	-	78,149,406	78,149,406
Balance as at March 31, 2024	30,000,000	118,733,257	78,955,563	227,688,820

• The statutory reserve represents profit set aside under Modaraba Regulations, 2021 issued by the Securities and Exchange Commission of Pakistan.

The annexed notes from 1 to 4 form an integral part of these condensed interim financial information.

For A R Management Services (Private) Limited

(Modaraba Management Company)

NAVEED RIAZ	OMAR MOHAMMAD KHAN	AMEED RIAZ	MUHAMMAD ALI BAIG
CHIEF EXECUTIVE	DIRECTOR	DIRECTOR	CHIEF FINANCIAL OFFICER

NOTES TO THE CONDENSED INTERIM FINANCIAL INFORMATION

FOR NINE MONTHS AND THIRD QUARTER ENDED MARCH 31, 2024

1. LEGAL STATUS AND NATURE OF BUSINESS

1. First Imrooz Modaraba (the Modaraba) was formed on September 27, 1993 under the Modaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980 (XXXI of 1980) and the Rules framed there under and is managed by A R Management Services (Private) Limited. The Modaraba commenced its commercial operations from March 01, 1994. The Modaraba is listed on Pakistan Stock Exchange.
2. The principal place of the business of the Modaraba is situated at Room No. 405, 4th Floor, Beaumont Plaza, Beaumont Road, Civil Lines Quarters, Karachi and its warehouses at C-28, S.I.T.E , Karachi and 125-S, Small Industrial Area, Kot Lakhpat, Lahore, in the provinces of Sindh & Punjab, Pakistan
3. It is a multi purpose, perpetual Modaraba and is mainly engaged in domestic and international trading activities. The Modaraba primarily trades in industrial raw materials, catering to numerous industries like paint, coatings, pharmaceuticals, food, agriculture, personal care, household, textile etc.

1. BASIS OF PREPARATION

1. This condensed interim financial information has been prepared in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting which comprised of International Accounting Standard (IAS) 34 - Interim Financial Reporting, Islamic Financial Accounting Standards (IFAS) as notified under the provisions of the Companies Act, 2017, Modaraba Companies and Modaraba (Floatation and Control) Ordinance, 1980, the Modaraba Companies and Modaraba Rules, 1981 and directives issued by the Securities and Exchange Commission of Pakistan ['the Modaraba Regulations'].
   Wherever the requirements of 'the Modaraba Regulations' differ from the requirements of International Accounting Standard (IAS) 34 - Interim Financial Reporting and Islamic Financial Accounting Standards (IFAS), the requirements of 'the Modaraba Regulations' have been followed.
2. The disclosures made in this condensed interim financial information have been limited based on the requirements of IAS 34. This condensed interim financial information does not include all information and disclosures required in a full set of financial statements and should be read in conjunction with the annual published audited financial statements of the Modaraba for the year ended June 30, 2023.
3. The comparative statement of balance sheet presented in this condensed interim financial information has been extracted from the annual audited financial statements of the Modaraba for the year ended June 30, 2023, whereas the comparative condensed interim profit and loss account, condensed interim cash flow statement, condensed interim statement of changes in equity of the Modaraba are extracted from the unaudited condensed interim financial information for third quarter and nine months period ended March 31, 2023.
4. These financial statements have been prepared under the historical cost convention and have been prepared following accrual basis of accounting except for cash flow statement.

NOTES TO THE CONDENSED INTERIM FINANCIAL INFORMATION

FOR NINE MONTHS AND THIRD QUARTER ENDED MARCH 31, 2024

2.1.5 This condensed interim financial information is prepared in Pakistani Rupees which is the Modaraba's functional and presentation currency. The figures in this condensed interim financial information have been rounded off to the nearest rupee unless otherwise specified.

1. SIGNIFICANT ACCOUNTING AND RISK MANAGEMENT POLICIES, ACCOUNTING ESTIMATES, JUDGEMENT AND CHANGES THEREIN
   The accounting policies adopted for the preparation of the condensed interim financial information are the same as those applied in the preparation of the annual audited financial statements of the Modaraba for the year ended June 30, 2023.

3. CONTINGENCIES AND COMMITMENTS

1. Contingencies

1. In respect of show cause notices issued to the Modaraba by the Collectorate of Customs (Adjudication-II), Karachi, the Honorable Customs Excise and Sales Tax Appellate Tribunal, Karachi decided the appeal in our favor as per order dated October 09, 2023 and dated January 08, 2024.
2. In addition to above, the Deputy Collector of Customs, Adjudication-II, Karachi passed an order on 10-02- 2023, creating aggregate demand of Rs.1,623,672, includes Customs Duty, Additional Customs Duty, Sales Tax, Income Tax and Penalty on the alleged ground that declared valuation of specified imported goods were lower than the assessable value. The matter is pending before the Collector of Customs (Appeals), Karachi and the management is confident of favorable outcome, therefore the management has not recorded any provision for the said amount in these financial statements.
3. The Deputy Commissioner (DC) - Unit 37 of the Sindh Revenue Board (SRB) issued Show Cause Notices (SCNs) in October 2023 relating to the tax period ended June-2016 to June-2022 for recovery of Sindh Workers Welfare Fund (SWWF).
   The Modaraba has filed its responses to the said SCNs taking plea that Modaraba is not engaged in any kind of activity whatsoever related to banking or financial institution, since its inception. It is engaged in the business of commercial imports of specialty chemicals. Therefore, provisions of SWWF are not applicable on the Modaraba.
   The DC of SRB passed 07 order in Nov-2023 and in Jan-2024 creating aggregate demand of Rs.26,387,353/-, which includes Penalties Rs.778,000/- and Additional amount @ 15% p.a. Rs.9,749,348/-
   .
   The Modaraba has filed appeals before the Commissioner Appeals, SRB, Karachi where the matter is pending. The Commissioner Appeals has pleased to grant stay of disputed demand. The management of the Modaraba is hopeful of positive outcome.