—_ EY Building a better working world AIRLINK COMMUNICATION LIMITED CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE SIX MONTH PERIOD ENDED. 31 DECEMBER 2020—_ EY Building a better working word INDEPENDENT AUDITOR'S REVIEW To the members of Airlink Communication Limited Report on review of Condensed Interim Financial Statements Introduction We have reviewed the accompanying condensed interim statement of financial position of Airlink Communication Limited as at 31 December 2020 and the related condensed interim statement of profit or loss, condensed interim statement of comprehensive income, condensed interim statement of changes in equity, condensed interim statement of cash flows, and notes to the condensed interim financial statements for the six-month period then ended (here-in-after referred to as the “condensed interim financial statements"). Management is responsible for the preparation and presentation of these condensed 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 financial statements based on our review. 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 condensed 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 report is Abdullah Fahad Masood, COL Dard Reader EY Ford Rhodes Chartered Accountants Lahore: 20 April 2021 Page 1 of 1AIRLINK COMMUNICATION LIMITED CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2020 31 December 2020 30 June 2020 Note, (Unaudited) _ usted) ASseTs (Rupees) (Rupees) NON CURRENT ASSETS Property and equipment 4 1088 T7878 FOSTERS Intangibles 42,566,641 8808 487 Defered tax asset 25.269.910 81.265.214 77198 555,668 367.043,646 CURRENT ASSETS: Stockin trade 5 FIST 257505 TBTO OST BS Trade debis 4781.597.16 4655.311.795 Loans and advances 33.482.470 166 642,003 “Trade deposts and shor term prepayments 41.897.328 36,116,002 “Tax refunds due fom the Government 224,525,195 248.964.068, Other receivables 6:167,893.793 9,182.394.650 Short term investments "732528,380 726,246,877 ash and bank balances Treses31 514.268.761 e 75.531,79%,429——20,407.955,082 TOTAL ASSETS Tas FORTE EQUITY AND LIABILITIES EQUITY AND RESERVES ‘Authorized share capital ‘400,000,000 (30 June 2020: 400,000,000) ordinary shares of Rs.10 each 4,000,000,000 __4.000,000.000_ Issued, subscribed and paid up capital 3,000,000,000 3,000,000,000 General reserves. 44,559,977 44,559,977 Loan from director - 21,557,155 Long term loan - equity portion 42,744,954 42,744,954 ‘Accumulated profit 2,445,944,472 1,487,720,145 5,533,249,403 4,596,582.231 NON CURRENT LIABILITIES Long term loan - debt portion 428,716,154 412,818 648 e Net defined benefit ability 31,496,285 29,188,579 Lease liabilities 458,550,908, 295,102,166 918,763,347 737,108,593 ‘CURRENT LIABILITIES. Trade payables, accrued and other labilties 3,755,750 818 ABT B30 SS Contract labilties 117,073,115 Refund labilties 7,835,833 Accrued markup 163,414,317 ‘Short term borrowings 6 8,183,936 642 Current portion of long term loans 444,822,128 "415,028,414 Current maturity of lease liabilities 107,503,073 75,384,670 Provision for taxation 193,582,966 196,994,778 17,218,334,345 75,64 1,307,084 TOTAL EQUITY AND LIABILITIES TF S7O SAT 095_ 20,874,908 508 The annexed notes from 1 to 13 form an integral par ofthese condensed inter financial statements, Howe Me OL Chist Executive Director Page 1 of 9AIRLINK COMMUNICATION LIMITED CONDENSED INTERIM STATEMENT OF PROFIT OR LOSS FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2020 Note Revenue from contracts with customers - net 8 Cost of sales 8 Gross profi Administrative expenses Seling and distribution cost Operating profit Other income Other expenses Finance cost Profit before taxation Taxation Net profit for the period Six month period ended ‘34 December 2020 (Un-audited) (Rupees) 28,123,770,180 (25,508,600,016) ta 70,164 ‘31 December 2019 (Audited) (Rupees) 18,432,476,000 (18,858 488,174) 7573 989,826 (284,859,246)| (311,764,371)| (225,771 061)| (185,654,286) (696,625,617) 2 BaT 56,010,702 (3,942,134) (670,052,762) 1,496, 562,555 (639,581,048) 958,987,308 (411 422,347) 2,162,567 479 122,554,574 (293,350) (688,457,353) 7,596,577,350 (625,541,385) 570,625,965 ‘The annexed notes from 1 to 13 form an integral part of these condensed interim financial statements. Chief Executive Page 2 of 8 Hee CL rectorAIRLINK COMMUNICATION LIMITED CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2020 Six month period ended Bi December 2020 31 December 2019 (Un-audited| (Audited) (Rupees) (Rupees) Net profit for the period 958,981,308 970,828,965 Items not to be rectassified to profit or loss in subsequent periods Re-measurement losses on defined benefit plan (1,067,582)| = Tax effect 309,600 - Re-measurement losses on defined benefit plan - net of tax (757,982) ~ Total comprehensive income for the period The annexed notes from 1 to 13 form an integral part of these condensed interim financial statements. sans thy ChieFExeCative Director Page 30f9AIRLINK COMMUNICATION LIMITED CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2020 = Revenue Reserves —~ ~~ Capital Reserves — sun carer |] tans ovat’ ana [Accumaistd pront|| S604! |] ansogaty || Loantom Dietor | | Tot pau catal ten Batre say 2018 Ande 2eaneoone —seaze7sio —assogr7§—aarasase ces1e6s 3.1400%4o20 Protx pat ae ; : aro Ober conpafene cone ho pr : : : : : tl cororhorene nce eh alos i aromas 3 ORE Tranecion wih ome len 5000000 one shaes @ Rs. 1OFerstae ——_—S0D8ED009 0000000 : : 4 ania : : . 5 sco2mere —_snozseer (Santora : : : : ciseatenea, aso 2 Balance as at 31 December 2019 (Audited) FG OT; DOO DOE TZT SSS AA SSO OTT A27aA ZAHA 258 4 703,796,744 Balance na Jy 2020 Ae) 20ue.000000 = saarzanae—aaatoarr—aarunase aissrass—4stesnaaso Pro tr te psd (Un aut) srs : [narra Cte comprehen efi pr (Unauts) : casrsea| : : : srs) Total comprhanie name fh pod (Unused) - ana 8 : : + aana.ze Transaction wth owner: Loan ul : : 2 : cavesrasyy — enseras) Balance as at 34 December 220 Unauie) jon g0qano” aaa paar —axssnorr- —aayaassa = ceezoae a i tes WL _ cutive Director Page 4 of 9AIRLINK COMMUNICATION LIMITED CONDENSED INTERIM STATEMENT OF CASH FLOWS FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2020 Six month, 3H December 2020 Wn-audited) __Aucites) CASH FLOW FROM OPERATING ACTIVITIES ‘Rupecs) ‘Feupecs) Prot before taxation 1.488,562,953 4,$96371.350 Adjustments for: Depreceton weer Aa ORT EES AAmortzation of tangle assets 243,070 1,226,420 Provsion far nt realzable valve reversed (3787.979) (101,078.078) ‘Allowance for expected credtoss - (429012) Provsion for gratuty 407,328 5.768.683, Loss on csposal of property and equipment terminaton on ease 3.942.136 293,380 Finaneal charges 570,082,782 616,185,885 Provsion wien of (6,594,008) - Finance income 1.545.850) 122,554,576) 792 44, 500.251 Operating profit before working capital changes Ziveaz.as| F037 871.601 (Increase\idecrease in current assets ‘Stock n trace 5 BO TEESTT| [1 BOT BOE 2TA) Trade debts (125.226.181)| | 1 100.968.589 e ane and advances fovea (ise03 2) Trade deposits and short term prepayments 24,217,783 2.608.207 Other recevabies 2,984;440 857 (25.576.838) Tax refunds 6ve fromthe Government 22430.854| | _2986.640.187) SASTATS.203 (3 792,044,468) Incroasedecroase) in current abit Trade payables, accrued and cher labios (2714926770) 1.220811727 Convact bites (60,168.45) ‘21.320323, ars aaa Financial charges paid (628,758,418) (695.591,601) Interest income received 41,548,850 115518492 Gratuty pais (3.427.200) (11382.260) Income tax paid (487,889,953) (s091872.126) NET CASH GENERATED FROM / (USED IN) OPERATING ACTIVITIES ns ET CASH FLOW FROM INVESTING ACTIVITIES ‘Addon in property and equipment - owned assets 4 (43,743,748) (17,888,918) ‘Adios in aptal workin progress (424'343,236) i Sale proceeds from cisposal of property and equipment : 11,888,000 ‘aston in intangibles (6,601,224) (6.788.722) e NET CASH USED IN INVESTING ACTIVITIES erase, TT S0 =) CASH FLOW FROM FINANCING ACTIVITIES Lease tity repais (77,984,086) (44,200.84) Funes transferred to former partners ; - Loans repaid (21,587,183) (490.214,162) Loans acauired 190,246,872 Share deposi money repaid : _ Decrease in short term Bank borrowings - net 6 (1,719,479,195) 655,702,862 NET CASH (USED IN) / GENERATED FROM FINANCING ACTIVITIES a NET DEGREASE IN CASH AND CASH EQUIVALENTS aay ary ‘CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD ssaosa5a8 = 2.772,168.18 CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD ae ee The annexed notes, 13 form an integral part ofthese condensed interim nancial statement Hemet Me tiesto Page 5 of 9AIRLINK COMMUNICATION LIMITED NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS FOR THE SIX-MONTH PERIOD ENDED 31 DECEMBER 2020 14 24 22 23 24 ‘THE COMPANY AND ITS OPERATIONS ‘The Company was incorporated in Pakistan on 02 January 2014 as a private limited company under the, repealed Companies Ordinance, 1984 (now Companies Act, 2017) having registered office at LG 2, Al - Qadeer Heights, 1 Babar Block, New Garden Town, Lahore, Punjab. The Company is engaged in the business of import, export distribution, indenting, wholesale, retail of communication and IT related products and services including cellular mobiie/smart phones, tablets, laptops, accessories and allied products During period, the Company has started to set-up facility for assembly of smart phones and feature hones located at 152-M, Quaid-e-Azam Industrial Area, Kot Laknpat, Lahore, Punjab, Pakistan. Initial assembling capacity has been planned for more than 400,000 mobile sets per month, ‘STATEMENT OF COMPLIANCE ‘These condensed interim financial statements have been prepared in accordance with the accounting ‘and reporting standards as applicable in Pakistan for interim financial reporting. The accounting and reporting standards as applicable in Pakistan for interim financial reporting comprise of International Accounting Standard (IAS) 34, Interim Financial Reporting, issued by the International ‘Accounting Standards Board (IASB) as notified under the Companies Act, 2017; and Provisions of and directives issued under the Companies Act, 2017, Where the provisions of and directives issued under the Companies Act, 2017 differ with the requirements of IAS 34, the provisions of and directives issued under the Companies Act, 2017 have been followed. The condensed interim financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the financial statements of the Company for the year ended 30 June 2020 ‘These condensed interim financial statements are unaudited but subject to limited scope review by the auditors, The condensed interim financial statements have been prepared under the historical cost convention except for the defined benefit obligation and lease liabilty which are measured at present value. These financial statements are prepared in Pak Rupees, which is the functional currency of the Company. Figures have been rounded off to the nearest Pak Rupees unless otherwise stated, SIGNIFICANT ACCOUNTING POLICIES ‘The accounting policies adopted are consistent with those of the previous financial period, except for the following new and amended standards and interpretations effective for annual period beginning on 01 July 2020, as listed below. The Company has not early-adopted any other standard, interpretation or ‘amendment that has been issued but is not yet effective. New Standards, Interpretations and Amendments IFRS 3 Definition of a business — (Amendments) IAS 1 and IAS 8 Definition of Material — (Amendments) IFRS 9, |AS 39 and IFRS 7 Interest Rate Benchmark Reform — (Amendments) The adoption of above amendments applied for the fist time in the period did not have any material impact cn the condensed interim financial statements of the Company. Page 6 of 94a 42 43 434 44 434 54 PROPERTY AND EQUIPMENT ‘Operating red assets Capital work in progress Right-of-use assets Movement in operating fixed assets is as follows: ‘Opening balance ‘Adelions during the periog/ year ‘Transfers from leased assets Depreciation for he period / year Closing balance ‘Additions in operating fixed assets during the period / year are as follows Furniture and focures Computers Office equipment Movement in capital workin progress isa follows: Opening balance ‘Additions during the period! year Closing balance Capital workin process comprises of Civ work Plant and machinery Allof the adsitions relates tothe new mobile phone manufacturing/assembly factory. [Movement in right-otuse assets is as folows: Opening balance ‘Additions during the period / year Disposals during the period / year ‘Transfer to operating fixed assets Depreciation for the period / year Closing balance ‘Addlions in rightotuse assets during the period / year a Motor vehicles Rented premises-buldings STOCK IN TRADE Mobile phones Equipment Spare paris Provision for net realizable value Goods in transit 28 olows ‘Movement in provision for net realizable value Isa follows: pening balance versal curing the period / year Closing balance ‘SHORT TERM BORROWINGS JS Bank Limited Bank AL Habib Limited Dual isiamic Bank Bank Alfalah Limited Habib Metropolitan Bank ‘Askari Bank Limited Pak Oman Investment Company Page 7 of 9 4a 42 AIRLINK COMMUNICATION LIMITED 31.December 2020 30 June 2020, Noto. (Unaudited (Ausite) (Rupees) ‘(Rupees) 91,638,820 71,185,584 424,343,236 : 583,737,059 405,808,551 44 aaa 43 ant 54 sere 71,185,584 43,027,401 475 91,638,620, 2,984,930 5,727,529 343314942 43,027,404 424,343,236 ——te rs 53,087,228 32,991,201 15,766,920, (30/529.756) 77,165,594 5.316.420 2/928 162 24,748,589, 32,991 201 ra 503.236- 263,457,422 : 160,885,505 424,343,327 zi 405,806,551 55,030,385 287,357,102 443,651 899 (18,223,620) (12,178;380) é (15,766,820) (64,202,964) (65,938,403) 383,797,058 05,806 557 19,449,394 39512810 237,907.768 424,139,020 257;357.102 43.651 859 B55 ABT EE EBT SOS : 3.343.651 190,967,640 167,910.918. 366,429,286 2,752,877 565 (22,323,528) 32.675 515) 964,105,770 720,202,050 2,787/145,735 1 359,840,845, 3,751,251,505. 92,675,515 (10,351,987) 22,323,528 219,139,373, 11859,843,337 27,368,654 413,313,749 702,522,242 267,270,082 275,000,000. 6464, 457,447 #510057, 595— 143,750,194 111,082'519) 32575515, 1.912,364236 3.950 430.047 432,159,505 350,788,753 324,184,000 275,000,000 3753 936.542 Tn.ma 12 10 " AIRLINK COMMUNICATION LIMITED CONTINGENCIES AND COMMITMENTS. Contingencies ‘There is ne material change in the contingencies since the last audited financial statements fr the year ended 30 June 2020, 31 December 2020 30 June 2020, (Un-ausited (ausite) Commitments (Rupees) (Rupees) Letiers of credit 3.059,773,375 6.035,542,751 Bank guarantees 31,750,500, 4250.50 3.09%, 523.875: BiG. 795.251 ‘Six month period ended ‘BT December 2020 31 December 2015 Un-audited (Ausied) REVENUE FROM CONTRACTS WITH CUSTOMERS - NET (Rupees) (Rupees) Sales -ocal 30,168,598,480 _17,992,781.503 Sales - export : 11506, 182.449 Service income 19816,103, 18,096, Gross sales or Less: Salos tex (24,505,544) 29,712, waiessosea: —isdar never Less: Discount (2.040,138.86 054.872.7614) 26,123,770,180_ 18 432.876, Geographical region: Pakistan 90,188,414,599, 18.010,078.365 UAE 1.506.182.4493. 30,788,474 5693 ‘Timing of transfer of goods and services: ‘Ata point in time 30,188,614,593 19.517.060.814 ‘COST OF SALES: Cost of ocal sales 22,316,830,023 12,126,141.711 Cost of export sales + 1,208,174,818 ‘Sales tax mobiles 4,013,383,270 1,002,942,280 ‘Sales tax-tablets 19,571,782 9,683,199 Regulatory duty 2,106,723,180 1,991,497,080 Custom duty- tablets 6,016,437 510,089 Domestic cariage 4,060,577 1.341.618 Insurance 368 5,505,811 Clearing charges a78 22,688,780 Depreciation 6,073,000 - 25;509,500,016 __15,858,486.174 jae SOS OSE TRAST RELATIONSHIPS AND TRANSACTIONS WITH RELATED PARTIES ‘The related party transactions includes remuneration of key management personnel which is disclosed in note 11. REMUNERATION OF CHIEF EXECUTIVE AND EXECUTIVES “The aggregete amounts charged in the interim financial statements in respect of remuneration, including all benefits to Chjet Executives and Executves of the Company areas follows: Chiet Executive Executives || ‘Sixmonth poriod ended ‘Sixmonth period ended | “HDocombor 2020 31 Gocenber 1075 — ‘Br December 202031 December 201 (Unaudited (Austed (Unaudited (audted) | (Rupees) ‘(Rupees) (Rupees) (Rupees) Managerial remunerator 24,000,000 20,000,000 74,217,600 45,207,024 Number of persons 1 1 4“ 8 oy Page 8 of 9 |AIRLINK COMMUNICATION wre 12 FINANGIAL.WGTRUMENTS -FAR VALUES | | 412.4. Falr value measurement of financial instruments Fair valu is the price that would be received to sel an asset or paid to transfor a liability in an ordery transaction between market pariipants at the measurement date, Undertying the efinition of fir value is the presumption that the Company isa going concern without any Intation er requirement to curtail maeraly the scale ofits operations oro undertake @ ransacton on adverse terms. IFRS 13, Fair Value Measurements’ requires the Company to classity fair value measurements using a fair value hierarchy thet reflects the significance of he inputs used in making the measurements. The fir value hierarchy has the folowing levels: Le 1 — Quoted (unadjusted) market prices in acte markets for identical assets or labiltios + Level 2 — Valuation techniques for which the west level input that is significant tothe fair value measurement is diecty or indiecty observable + Level 3— Valuation techniques for which the lowest level nput thats significant tothe fair value measurement is unobservabl ‘occurred between levels inthe hierarchy by re-assessing categorisation (based on the lowest level input that is sgnificant to (ne For assets and abies that are recognised a far value cn a recuting basis, the Company determines whether transfers ng fair value measurement as a whole) a the end of each repotng period, ‘There were no changes in the Companys valuation processes, valuation techniques, and types of inputs used in th fae value ‘measurements during the period, ‘The carrying value of all financial assets and lables not carted at fair value inthe financial statements approximate ther far values and accordingly, detalled disclosures of fair value are not being presented in these financial statements, “The folowing table shows the carrying amounls and fair values of financial instruments and non-financial instruments including their levels inthe fer value hierarchy Tota ‘31 December 2020, | Financial assots at far value through profit orloss Investment in mutual funds 13,103.651 43,103,8 30 June 2020 Financial assets at fir vale through Profit or loss Investment in mutual funds 35.689.564_ ‘34 December 2020 30 June 2020 12.2. Movement in financial assets at far value through proftor loss is as follows: (Un-audited) (Audited) (Rupees) (Rupees) Opening balance 35,683,584 23,000. (Deletions) /adtions (26,000,000) 13.3000 Gain (loss) on investment 3,420,087 (1.116.436) Closing balance 73,103,551 35.683.564 13° GENERAL These condensed interim financial statements were authorized for issue by the Board of Diraciors of the Company én 0. APR 202: Se Hun ee | CHE Diector Page 9 of 9 |