Sitara Peroxide : Transmission of Half yearly Report for the Period Ended 31.12.2021

HALF YEARLY REPORT DECEMBER

2021

Company Information
Board of Directors	Mrs. Sharmeen Imran	Chairperson
	Mr. Imran Ghafoor	Chief Executive Officer
	Mr. Haroon Ahmed Zuberi	Executive Director
	Mr. Ejaz Hussain	Non-Executive Director
	Mr. Yasir Ahmed Awan	Non-Executive Director
	Mr. Zahid Aslam	Independent Director
	Mr. Mahmood Ahmad	Independent Director
Chief Financial Officer	Mr. Waqar Hafeez (FCA)
Company Secretary	Mr. Mazhar Ali Khan
Head of Internal Audit	Mr. Zia-ul-Mustafa
Audit Committee	Mr. Zahid Aslam	Chairman
	Mr. Mahmood Ahmad	Member
	Mrs. Sharmeen Imran	Member
	Mr. Zia-ul-Mustafa	Secretary
Human Resource and	Mr. Mahmood Ahmad	Chairman
Remuneration Committee	Mr. Imran Ghafoor	Member
	Mr. Ejaz Hussain	Member
External Auditors	M/s Deloitte Yousuf Adil
	Chartered Accountants
Legal Advisor	Sahibzada Waqar Arif
Registered Office	601-602 Business Centre, Mumtaz Hassan Road,
	Off. I.I. Chundrigar Road, Karachi-74000.
	Ph: (92 21) 32401373, 32413944
Company Website	www.sitaraperoxide.com
Bankers	Al Baraka Bank (Pakistan) Limited
	Askari Bank Limited
	Bank Alfalah Limited
	Faysal Bank Limited
	Habib Bank Limited
	MCB Bank Limited
	Meezan Bank Limited
	National Bank Limited
	Soneri Bank Limited
	Standard Chartered Bank (Pakistan) Limited
	Summit Bank Limited
	United Bank Limited
	JS Bank Limited
	First Women Bank Limited
	Bank Al Habib Limited
Share Registrar	THK Associates (Private) Limited
	Plot No. 32-C, Jami Commercial Street 2,
	D.H.A., Phase VII, Karachi - 75500, Pakistan.
	UAN:	(92 21) 111-000-322
	Ph:	(92 21) 35310183-84
	Fax:	(92 21) 35310191
Head Office & Project Location	26 - KM Sheikhupura Road, Faisalabad.
	Ph : (92 41) 2400900-2,2400904-5
Sitara Peroxide Limited // Half Yearly Dec 31, 2021		1

Directors' Report

DIRECTORS REVIEW

I, on the behalf of Board of Directors of your Company, have pleasure in presenting you the un-audited condensed interim financial information for the half year ended December 31, 2021.

The quarter under review has been very testing period for your Company. From July 2021, the Company is facing challenge of unprecedented rise in tariff of RLNG. The Company uses RLNG as feedstock in manufacturing of Hydrogen Peroxide and its captive power house in also run on RLNG. Unlike exporters, fertilizer manufacturers etc which receive natural gas at subsidized rate, local Hydrogen Peroxide manufacturing industry is exposed to fluctuations in tariff of RLNG in international market. Global demand of RLNG has been on higher side due to resumption of economic activities after Covid-19 lockdowns, winter season and global supply bottlenecks.

Net sales during the six months period under review remained Rs. 1,044 million against net sales of Rs. 1,067 million during the corresponding period of financial last year. Drop in turnover during the period is due to decrease in sales volume. Cost of sales rose to Rs. 986 million as compared to 784 million. High cost of RLNG and power is major reason of the above increase. Due to comparatively lower prices of our product and rising cost of production, gross profits of your Company decreased. The capacity utilization in current period remained 78% of the installed capacity while the capacity utilization in previous half year period remained 80%. During first six months, Company incurred net loss after tax of Rs. 92 million and loss per share of Rs. 1.67 as against net profit after tax of Rs. 96 million and earnings per share of Rs. 1.75 in corresponding period of last financial year.

During quarter ended December 31, 2019, net sales remained Rs. 594 million against net sales of Rs. 497 million during the corresponding period of financial last year. Cost of sales rose to Rs. 511 million as compared to 348 million. High cost of RLNG and higher power cost are major reason of the above increase. The Company earned net profit after tax of Rs. 7 million and earning per share of Rs. 0.13 against profit after tax of Rs. 46 million and earnings per share of Rs. 0.83.

Despite all challenges, management of the Company is confident of maintaining its market share. We are positive about future business outlook. Demand of hydrogen peroxide is expected to remain strong in future due to expected rise in exports of textile sector. We are confident of much improved financial performance in second half of ongoing financial year.

The Board takes this opportunity to thank all stakeholders for their continued support. We also appreciate and acknowledge the continued commitment and hard work of our employees.

Allah may give us the courage to face the challenges ahead. Aameen

On behalf of Board of Directors

Faisalabad	IMRAN GHAFOOR
February 24, 2022	Chief Executive Officer

2	Sitara Peroxide Limited // Half Yearly Dec 31, 2021

Directors' Report
Sitara Peroxide Limited // Half Yearly Dec 31, 2021	3

Auditors' Review Report

INDEPENDENT AUDITORS' REVIEW REPORT

TO THE MEMBERS OF SITARA PEROXIDE LIMITED

REVIEW OF CONDENSED INTERIM FINANCIAL STATEMENTS

Introduction

We have reviewed the accompanying condensed interim statement of financial position of Sitara Peroxide Limited (the Company) as at December 31, 2021, the related condensed interim statement of profit or loss, condensed interim statement of comprehensive income, condensed interim statement of changes in equity, and condensed interim statement of cash flows and notes to the financial statements for the six month period then ended (here-in-after referred to as the "interim financial statements"). Management is responsible for the preparation and presentation of these interim financial statements in accordance with accounting and reporting standards as applicable in Pakistan for interim financial reporting. Our responsibility is to express a conclusion on these interim financial statements based on our review.

The figures of the condensed interim statement of profit or loss, condensed interim statement of comprehensive income for the three-month period ended December 31, 2021 and related comparative information have not been reviewed, as we are required to review only the cumulative figures for the six month period ended December 31, 2021.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial statements 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 financial statements are not prepared, in all material respects, in accordance with the accounting and reporting standards as applicable in Pakistan for interim financial reporting.

The engagement partner on the review resulting in this independent auditor's review report is Nadeem Yousuf Adil.

Chartered Accountants

Lahore

Date: February 24, 2022

UDIN:

4	Sitara Peroxide Limited // Half Yearly Dec 31, 2021