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IBL HealthCare Limited

Quarterly Report September 2013

With You

all the WAY

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Directors Report

The Directors are pleased to present the condensed interim financial statements of your Company for

the period ended September 30, 2013. These condensed interim financial statements are submittedin accordance with section 245 of the Companies Ordinance, 1984.

OPERATING RESULTS

September 30,

2013 2012

(Rupees in thousand)

Revenue 245,564 194,988

Gross profit 88,044 52,889

Operating expenses 33,165 27,131

Operating profit 54,879 25,758

Profit before taxation 55,608 25,059

Profit after taxation 45,179 21,491

Turnover of the Company rose to PKR 246 million increased by 26% over the corresponding period lastyear.

During the period our major segments have shown good performance. Infants Nutritional Healthcare

Segment showed a growth in sales of approximately 36% and our Adult Nutritional Segment showed agrowth of 45% over the same corresponding period last year.

Gross margin during the period under review stood at 36%, as against 27% reported in the same period

last year. The said increase is mainly due to our increased focus on our high margin brands coupled withprice increase on few of our products. Operating expenses were maintained at 14% of the turnover.

FUTURE OUTLOOK

The Management clearly sees remarkable growth in IBL Health Care business in the future. Our sales force

is continuously focusing on providing high quality premium nutritional products to all of the potential healthCare Professionals. The effective planning of new launches and expanding the existing coverage in the

current year will not only continue the sales momentum but also increase the sales growth.

To generate better value and increase market share, aggressive promotional campaign on infant nutritionproducts, along with the introduction of children nutrition products during the year will contribute towards

the growth of our business.

For strengthening our Medical Disposable Division, new sources and products are identified for launch

during the new fiscal year to increase the business volume and profitability of the company.

ACKNOWLEDGEMENT

We wish to thank the customers for their faith in our products, and their continuing patronage. Withouttheir support we would not have been able to achieve these improved results.

We also take this opportunity to thank our suppliers, bankers and distributors for providing us with their

valuable support throughout the year.

Finally we wish to thank our staff who remained committed to deliver towards the growth of your Company.

Karachi

October 14, 2013

For and on behalf of the board

Mufti Zia Ul Islam

Chief Executive

Quarterly Report September 2013 01

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Condensed Interim Balance SheetAs at September 30, 2013

Mufti Zia ul Islam

Chief Executive Officer

Syed Nadeem Ahmed

Director

September 30, June 30,2013 2013

Unaudited AuditedNote Rupees in 000

AssetsNon-current assetsProperty, plant and equipment 4 6,539 7,529Investment property 123,588 123,588Intangible assets 32,805 35,064Long term loans and advances 502 185

163,434 166,366

Current assetsStock in trade 177,901 152,835

Trade debts-unsecured 188,762 143,073Short term loans and advances 789 355Deposits, prepayments and other receivables 17,531 16,004

Taxation 3,702 3,702Cash and bank balances 20,892 15,139

409,577 331,108Total assets 573,011 497,474

Equity and liabilitiesShare capital and reserves

Authorised share capital21,000,000 oridinary shares of Rs. 10 each 5 210,000 210,000Issued, subscribed and paid-up share capital 5 200,000 200,000Unappropriated profit 217,789 172,610

Total equity 417,789 372,610

LiabilitiesNon-current liabilitiesLiabilities against assets subject to finance lease - 1,096Staff retirement benefit 3,521 9,041

3,521 10,137Current liabilities

Trade and other payables 149,602 113,410Current maturity of liabilities against assets subject

to finance lease 2,099 1,317151,701 114,727

Contingencies and commitments 6 - -Total liabilities 155,222 124,864Total equity and liabilities 573,011 497,474

The notes 1-8 are an integral part of these condensed interim financial statements.

02 IBL HealthCare Limited

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Condensed Interim Profit and Loss AccountFor the quarter ended September 30, 2013

Mufti Zia ul Islam


Syed Nadeem Ahmed

Director

September 30, September 30,

2013 2012

Unaudited

Rupees in 000

Revenue 245,564 194,988

Cost of sales 157,520 142,099

Gross profit 88,044 52,889

Selling and distribution cost 26,705 21,627

Administrative expenses 4,201 3,329

Amortization of intengible assets 2,259 2,175

Operating profit 54,879 25,758

Other operating income 2,201 1,344

Other charges 1,045 512

Finance cost 427 1,531

Profit before income tax 55,608 25,059

Income tax expense 10,429 3,568

Profit for the period 45,179 21,491

Earnings per share (Rupees) 2.26 1.07



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Condensed Interim Statement of Cash FlowsFor the quarter ended September 30, 2013

September 30, September 30,2013 2012

Unaudited

Rupees in 000

Cash flows from operating activities

Profit before taxation 55,608 25,059

Adjustments for non-cash charges and other items:

Depreciation 990 693

Amortization of intangible asstes 2,259 2,175

(Reversal of) / provision for staff retirement gratuity (5,520) 544

53,337 28,471

Increase in stock in trade (25,066) (21,076)

Increase in trade debts (45,689) (20,197)

Decrease in short-term loans and advances (434) 52

(Incease) / decrease in deposits, prepayments

and other receivables (1,527) 5,444

Decrease / (increase) in trade and other payables 36,192 (19,527)

Cash generated from / (used in) operations 16,813 (26,833)

Long term loans (317) 93

Income tax paid (10,429) (3,578)Net cash flows from operating activities 6,067 (30,318)

Cash flows from financing activities

Liabilities against assets subject to finance lease (314) (291)

Net cash flows from financing activities (314) (291)

Net increase / (decrease) in cash and cash equivalents 5,753 (30,609)

Cash and cash equivalents at start of period 15,139 13,651

Cash and cash equivalents at end of period 7 20,892 (16,958)


Mufti Zia ul Islam


Syed Nadeem Ahmed

Director


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Condensed Interim Statement of Changes in EquityFor the quarter ended September 30, 2013

Issued,

subscribed and

paid-up share

capital

Unappropriated

profit

Total

Rupees in 000

Balance as at July 1, 2012 200,000 121,994 321,994

Profit for the period - 21,491 21,491

Balance as at September 30, 2012

(unaudited) 200,000 143,485 343,485

Balance as at July 1, 2013 200,000 172,610 372,610

Profit for the period - 45,179 45,179

Balance as at September 30, 2013

(unaudited) 200,000 217,789 417,789


Mufti Zia ul Islam


Syed Nadeem Ahmed

Director


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Notes to the Condensed Interim Financial StatementsFor the quarter ended September 30, 2013

1 General information

The Company was incorporated in Pakistan as a Private Limited Company on July 14,

1997. In November 2008 the Company was converted into Public Limited Company and

its shares have been listed on Karachi Stock Exchange. The address of its registered

office is 9th Floor, N.I.C. Building, Abbasi Shaheed Road, Karachi. The principal business

activities of the Company are marketing, selling and distribution of healthcare products.

The Company is the subsidiary of The Searle Company Limited.

These condensed interim financial statements were approved for issue on October 24,

2013.

2 Basis of preparation

These condensed interim financial statements have been prepared in accordance

with the requirements of International Accounting Standard No. 34, Interim Financial

Reporting and is being submitted to the shareholders as required by section 245 of the

Companies Ordinance, 1984 and the Listing Regulations of Karachi Stock Exchange.

3 Accounting policies

The accounting policies applied are consistent with those of the annual financial

statements for the year ended June 30, 2013, as described in those annual financial

statements.

4 Property, plant and equipment

No addition to Property, Plant and Equipment was made during the quarter ended

September 30, 2013.

5 Authorized capital September 30, June 30,2013 2013

Rupees in 000

21,000,000 (June 2013: 21,000,000) ordinary

shares of Rs.10 each 210,000 210,000

Issued, subscribed and paid-up share capital

20,000,000 (June 2013: 20,000,000) fully paid

ordinary shares of Rs. 10 each 200,000 200,000

6 Contingencies and commitments

Letter of credit outstanding during the period amounted to Rs.178 million (June 2013:

Rs. 176 million) of which the amount remaining unutilized was Rs.87 million.


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7 Cash and cash equivalents September 30, June 30,2013 2013

Rupees in 000

Cash and bank balance 20,892 15,139

8 Related party transactions

8.1 The Company is controlled by The Searle Company Limited which owns 50% of the

Companys shares. The remaining 50% of the shares are widely held. IBL Operations

Private Limited and International Franchises Private Limited are associated company on

the basis of common directorship.

8.2 During the quarter ended September 30, 2013, sales, share of employee costs and

expenses amounting to Rs. Nil (quarter ended September 30, 2012: Rs. 1.17 million)

were charged by The Searle Company Limited. As at September 30, 2013, an amount of

Rs. 0.02 million (June 30, 2013: Rs. 0.8 million) was due to The Searle Company Limited

in respect of such expenses. As at September 30, 2013, an amount of Rs. 0.13 million

(September 2012: 0.41 million) is due from The Searle Company Limited in respect of

the sales.

8.3 During the quarter ended September 30, 2013, sales of Rs. 188.79 million (quarter ended

September 30, 2012: Rs. 139.04 million) were made to IBL Operations Private Limited.

As at September 30, 2013, an amount of Rs. 11.07 million (September 30, 2012: Rs.

98.03 million) is due from IBL Operations Private Limited in respect of the sales.

8.4 During the quarter ended September 30, 2013, share of employee costs and expenses

amounting to Rs. 0.13 million (quarter ended September 30, 2012: Rs. 0.20 million)

were charged to International Franchises Private Limited. As at September 30, 2013, an

amount of Rs. Nil (June 30, 2013: Rs.Nil) was due from International Franchises Private

Limited in respect of such expenses.

Mufti Zia ul Islam


Syed Nadeem Ahmed

Director


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Notes


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IBL HealthCare Limited

9th Floor, N.I.C. Building, Abbasi Shaheed Road,

Off: Shahrah-e-Faisal, Karachi-75530

www.searlecompany.com/iblhc

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iblhc3q2013.80