· pdf filejcr-vis credit company limited. hascol has a strategic license agreement with fuchs...

04 Corporate Information

06 Directors’ Review Report

08 Independent Auditors’ Review Report

12 Condensed Interim Unconsolidated Financial Statements

28 Condensed Interim Consolidated Financial Statements

Contents

In 2005, Hascol Petroleum Limited was granted the Oil Marketing License by the Government of Pakistan and ever since, the company has aggressively invested in establishing a countrywide network of over 400 retail fuel stations in four provinces of Pakistan and Azad Jammu and Kashmir under the Hascol brand with further sites planned during the coming year.

The company is all set to jump up a number on the competitive ladder, strategizing its position ahead in terms of market share. The acquisition of 10 retail outlets on the Lahore-Islamabad Motorway has strengthened the company’s backbone to broaden its network and has given the Hascol brand a remarkable boost in Central Punjab and has encouraged the company’s sales volume and profitability.

Over the years, Hascol has constructed storage facilities at Keamari, Daulatpur, Shikarpur, MehmoodKot, Machike and Amangarh with further storages planned at Sahiwal, Kotlajam and Thalian.

Hascol obtained listing on the Pakistan Stock Exchange in May 2014 and its share

price has appreciated significantly since getting listed in line with company’s growth having received a credit rating of ‘A+/A-1’ (Single A Plus /A-One) from JCR-VIS Credit Company Limited.

Hascol has a strategic License agreement with FUCHS Middle East (FOMEL), an associate of FUCHS Petrolub based in Germany, to represent the brand in Pakistan. The German brand has emerged as a tough competitor in the oil lubricants sector depicting doubling sales volumes year after year. With an estimated cost of USD 20 Million, the company owned Lube Oil Blending Plant is expected to start operations by December 2017. Hascol has emerged as a strong competitor for its counterparts in the industry and continues to strengthen its footprints.

Hascol Petroleum Limited is the first OMC to market LPG through its Retail Network for the automotive sector. The company has plans to market LPG for domestic consumers and to develop several Auto gas LPG stations across the country in the coming year to accommodate the ever growing demand for energy.

Chairman & C.E.OMr. Mumtaz Hasan Khan

DirectorsMr. Abdul Aziz Khalid (Nominee of Vitol Dubai Limited)Mr. Farooq Rahmatullah Khan Mr. Liaquat AliMr. Najmus Saquib HameedMr. Saleem ButtMr. Sohail Hasan

Company Secretary Mr. Zeeshan Ul Haq

Audit CommitteeMr. Sohail Hasan (Chairman)Mr. Liaquat Ali (Member)Mr. Najmus Saquib Hameed (Member)

Strategy CommitteeMr. Farooq Rahmatullah Khan (Chairman)Mr. Mumtaz Hasan Khan (Member)Mr. Liaquat Ali (Member)Mr. Saleem Butt (Member)

Human Resource CommitteeMr. Najmus Saquib Hameed (Chairman)Mr. Mumtaz Hasan Khan (Member)Mr. Liaquat Ali (Member)

AuditorsGrant Thornton Anjum Rahman Chartered Accountants

Page 04QUALITY PERSONIFIEDSix Months Period Ended June 2017

BankersAllied Bank LimitedAl Baraka Bank (Pakistan) LimitedAskari Bank LimitedBank Al Falah Limited Bank Al Habib LimitedBank Islami Pakistan LimitedFaysal Bank LimitedFirst Women Bank LimitedHabib Metropolitan Bank LimitedHabib Bank LimitedIndustrial and Commercial Bank of China Limited MCB Bank LimitedNational Bank of Pakistan Samba Bank LimitedSindh Bank LimitedSoneri Bank LimitedSummit Bank LimitedUnited Bank Limited

Share RegistrarCentral Depository Company of Pakistan Limited

Legal AdvisorMohsin Tayebaly & Co.Corporate Legal Consultants - Barristers & Advocates

Registered OfficeThe Forum, Suite No. 105-106 First Floor, Khayaban-e-Jami Clifton, Block - 9, Karachi, Pakistan Phone: +92-21-35301343-50Fax: +92-21-35301351UAN: 111-757-757E-mail: [email protected]: www.hascol.com

Six Months Period Ended June 2017 Page 05

At the beginning of this year, HASCOL’s Board of Directors set very challenging growth targets for 2017. I am happy to report that your Company is well on track to surpass those aggressive targets.

During the first half of the year, our sales volumes have grown up by 35% as compared to the corresponding period of the last year, which is a tremendous achievement considering the high base effect of the significant volumes achieved in 2016, the increased competition, changing fuel consumption patterns and difficult business environment. Our profit before tax has also increased from Rs. 985.88 Million in Jan-Jun 2016 to Rs. 1,429.63 Million in Jan-Jun 2017.

We had ended 2016 as the 3rd largest Oil Marketing Company (OMC) in the country in terms of volumes. You will be pleased to know that during 2017, we progressed further and are now the 2nd largest OMC in Pakistan – and the largest in the private sector.


Farooq Rahmatullah Khan Director

Najmus Saquib HameedDirector


I would like to thank the senior management and the HASCOL Team for executing the ambitious Business Plan successfully and hope that they will continue the hard work so that we end the ongoing year on this high note.

During the period under review, our Mehmoodkot installation was successfully commissioned enabling us to target the larger sales envelope at the confluence of our four provinces. Daily volumes at Mehmookdkot facility have exceeded our projections, strengthening our upcountry supply chain and contributing enormously towards our overall volumetric growth.

Your Company is fully committed to further enhance its supply chain infrastructure, especially upcountry. Our depot at Sahiwal is now complete which will further boost our sales volumes in the coming months. Simultaneously, construction is proceeding at a fast pace at Thalian, Kotla Jam and Hub. Similarly, our Retail Network is projected to grow to about 500 pumps by December 2017. These efforts will allow us to unlock our potential and further increase our market share in 2018.

As I mentioned in the last Annual Report, construction of HASCOL Terminals Limited at Port Qasim Terminal – which is a Joint Venture with Vitol– is progressing at a fast pace. Construction of the Lube Oil Blending Plant, which is in technical collaboration with FUCHS, is also ahead of schedule. Both these projects will be commissioned in 2018 In Sha Allah, providing further strength to our growth and diversification strategy.

Your Company is also cognizant of its responsibilities towards Health, Safety, and Environment. A thorough HSE Analysis has been conducted this year comparing our Operations to Best Industry Practices, leading to a Company-wide customized HSE Action Plan. Independent Fire Prevention Inspections of all our facilities have also been conducted.

The major challenge that we face is to maintain the high growth rate in future years, particularly in a market which is becoming increasingly competitive and in a business environment which is becoming more and more uncertain and difficult. Our recent achievements and future successes lie on transforming both the organization as well as our human capital. Our people are really our unique, sustainable and irreversible competitive advantage. We have the best Management of highly experienced industry professionals heading each of our functions along with a vibrant and energetic young team of performers. This unique combination is delivering phenomenal results. After Organizational Restructuring and Rightsizing, instituting a modern Performance Management System, ensuring a merit oriented Recruitment Process and revision of our HR practices, we are now embarked on a Talent Management Strategy to ensure the development and continuity of our Talent Pipeline.

As we grow our infrastructure, volumes and profitability, we are also enhancing our stature and reputation. Following the increase of Vitol’s equity to 25% we are now a true multinational and have become a member of the Overseas Investors Chamber of Commerce and Industry. In order to conform to the best international business and social norms, your Company has also recently become a member of United Nations Global Compact (UNGC) and we will be incorporating its Ten Principles in our corporate strategy.

I take this opportunity to also thank the Members of the Board for their continued support and guidance.

QUALITY PERSONIFIEDSix Months Period Ended June 2017


August 30, 2017

for the six months period ended June 30, 2017

ASSETS Non-current assets Property, plant and equipment 6 10,512,368 8,688,947 Long-term investments 7 2,378,469 1,961,977 Long-term deposits 291,117 288,882 Total non-current assets 13,181,954 10,939,806 Current assets Stock-in-trade 11,988,351 16,477,668 Trade debts 11,673,892 7,871,281 Advances 8 477,330 253,413 Deposits, prepayments and other receivables 9 2,087,966 1,286,748 Cash and bank balances 11,416,786 7,821,070 Total current assets 37,644,325 33,710,180

Total assets 50,826,279 44,649,986 EQUITY AND LIABILITIES Authorized share capital 1,500,000 1,500,000 Shareholders' equity Share capital 1,206,792 1,206,792 Reserves 4,594,807 3,755,346 Total shareholders' equity 5,801,599 4,962,138

Surplus on revaluation of fixed assets - net of tax 1,092,615 1,142,880 LIABILITIES Non-current liabilities Long term finances - secured 10 2,377,397 2,307,749 Liabilities against assets subject to finance lease 562,359 471,731 Deferred taxation - net 11 714,449 594,790 Deferred liability - gratuity 153,297 135,791 Total non-current liabilities 3,807,502 3,510,061 Current liabilities Trade and other payables 12 36,007,228 29,822,758 Mark-up accrued 82,164 91,185 Short term borrowings 2,758,137 3,889,629 Current portion of long term finances 10 903,007 599,079 Current maturity of liabilities against assets subject to finance lease 73,527 148,387 Taxation 300,500 483,869 Total current liabilities 40,124,563 35,034,907 Total liabilities 43,932,065 38,544,968 Total equity and liabilities 50,826,279 44,649,986 Contingencies and commitments 13 The annexed notes from 1 to 22 form an integral part of these condensed interim unconsolidated financial information.

CONDENSED INTERIM UNCONSOLIDATED BALANCE SHEETAS AT JUNE 30, 2017

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016

(Rupees in thousand)


The Chief Executive Officer is for the time being not in Pakistan therefore, these condensed interim unconsolidated financial statements have been signed by two directors.

DirectorNajmus Saquib Hameed

DirectorFarooq Rahmatullah Khan

CONDENSED INTERIM UNCONSOLIDATED PROFIT AND LOSS ACCOUNT - UnauditedFOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

Sales - net 94,552,773 59,260,277 51,750,587 30,767,436 Sales tax (17,022,134) (15,964,165) (9,028,283) (7,792,049)Net sales 77,530,639 43,296,112 42,722,304 22,975,387 Other revenue 211,890 70,852 125,774 39,284 Net revenue 77,742,529 43,366,964 42,848,078 23,014,671 Cost of products sold (74,692,636) (41,197,394) (41,226,211) (21,607,327)Gross profit 3,049,893 2,169,570 1,621,867 1,407,344 Operating expenses Distribution and marketing (1,167,850) (771,993) (627,697) (414,030)Administrative (301,082) (258,263) (152,480) (137,109) 1,580,961 1,139,314 841,690 856,205 Other income 133,675 90,044 66,742 36,890 Operating profit 1,714,636 1,229,358 908,432 893,095 Finance cost (262,358) (211,013) (148,489) (108,178)Other (charges)/ income (22,647) (32,460) 444 (34,848)Profit before taxation 1,429,631 985,885 760,387 750,069 Taxation 14 (639,024) (373,858) (346,506) (340,251) Profit for the period 790,607 612,027 413,881 409,818 Earning per share - basic & diluted 6.55 5.07 3.43 3.40

The annexed notes from 1 to 22 form an integral part of these condensed interim unconsolidated financial information.

NoteJune 30,

2017June 30,

2017June 30,2016

Six months period ended Three months period ended

June 30,2016










CONDENSED INTERIM UNCONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - Unaudited FOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

Profit for the period 790,607 612,027 413,881 409,818 Other comprehensive income: Items that may be re-classified subsequently to profit and loss account Unrealized gain/ (loss) due to change in fair value of long term investment classified as 'available-for-sale' - net of tax 420,964 (152,509) (944,044) (68,119)

Total comprehensive income 1,211,571 459,518 (530,163) 341,699 The annexed notes from 1 to 22 form an integral part of these condensed interim unconsolidated financial information.

NoteJune 30,

2017June 30,

2017June 30,2016


June 30,2016



Balance as at January 01, 2016 1,206,792 1,070,828 684,721 1,566,762 4,529,103 Total comprehensive income for the six months Profit for the period - - - 612,027 612,027 Other comprehensive income Unrealized loss due to change in fair value of long term investment classified as 'available-for-sale' - net of tax - - (152,509) - (152,509)Total comprehensive income for the six months - - (152,509) 612,027 459,518 Transferred from surplus on revaluation of fixed assets on account of incremental depreciation - net of tax - - - 64,918 64,918 - - (152,509) 676,945 524,436 Transaction with owners Final dividend at Rs. 3.5 per share December 31, 2015 - - - (422,377) (422,377)Total transaction with owners - - - (422,377) (422,377) Balance as at June 30, 2016 1,206,792 1,070,828 532,212 1,821,330 4,631,162 Balance as at January 01, 2017 1,206,792 1,070,828 624,930 2,059,588 4,962,138 Total comprehensive income for the six months Profit for the period - - - 790,607 790,607 Other comprehensive income Unrealized gain due to change in fair value of long term investment classified as 'available-for-sale' - net of tax - - 420,964 - 420,964 Total comprehensive income for the six months - - 420,964 790,607 1,211,571 Transferred from surplus on revaluation of fixed assets on account of incremental depreciation - net of tax - - - 50,267 50,267 - - 420,964 840,874 1,261,838 Transaction with owners Final dividend at Rs. 3.5 per share December 31, 2016 - - - (422,377) (422,377)Total transaction with owners - - - (422,377) (422,377) Balance as at June 30, 2017 1,206,792 1,070,828 1,045,894 2,478,085 5,801,599 The annexed notes from 1 to 22 form an integral part of these condensed interim unconsolidated financial information.


CONDENSED INTERIM UNCONSOLIDATED STATEMENT OF CHANGES IN EQUITY - UnauditedFOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

ShareCapital

Share premium

Fairvalue

reserve

Unappropri-ated profit

RevenuereserveCapital reserve

Total







Note


CASH FLOWS FROM OPERATING ACTIVITIES Cash generated from/ (used) in operations 15 7,807,488 (64,437)Finance cost paid (271,379) (179,213)Dividend paid (422,377) (422,377)Gratuity paid - (790)Taxes paid (698,260) (341,907)Net cash generated from/ (used) in operating activities 6,415,472 (1,008,724) CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditure incurred (2,099,641) (1,269,092)Proceeds from disposal of property, plant and equipment 24,268 - Long term deposits (2,235) 18,950 Net cash used in investing activities (2,077,608) (1,250,142) CASH FLOWS FROM FINANCING ACTIVITIES Lease liability obtained/ (repaid) - net 15,768 (48,584)Long term deposits - (17,143)Long term finance obtained and repaid - net 373,576 2,292,380 Net cash generated from financing activities 389,344 2,226,653 Net increase/(decrease) in cash and cash equivalents 4,727,208 (32,213) Cash and cash equivalents as at the beginning of the period 3,931,441 2,658,492 Cash and cash equivalents as at the end of the period 16 8,658,649 2,626,279 The annexed notes from 1 to 22 form an integral part of these condensed interim unconsolidated financial information.

CONDENSED INTERIM UNCONSOLIDATED STATEMENT OF CASH FLOWS - UnauditedFOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

June 30,2017

June 30,2016

Six months period ended


1 STATUS AND NATURE OF BUSINESS 1.1 Hascol Petroleum Limited (the Company) was incorporated in Pakistan as a private limited company on March 28, 2001.

On September 12, 2007 the Company was converted into a public unlisted company and on May 12, 2014 the Company was listed on the Pakistan Stock Exchange Limited. The registered office of the Company is situated at Suite No.105-106, The Forum, Khayaban-e-Jami, Clifton, Karachi.

1.2 The Company is engaged in the business of procurement, storage and marketing of petroleum and related products, for

which the Company obtained oil marketing license from Ministry of Petroleum and Natural Resources in the year 2005. 1.3 These condensed interim unconsolidated financial information are separate financial statements of the Company in which

investments in subsidiary are accounted for on the basis of direct interest rather than on the basis of reported results. Condensed interim consolidated financial information are prepared separately.

2 BASIS OF PREPARATION 2.1 The condensed interim unconsolidated financial information of the Company for the six months period ended June 30,

2017 are unaudited and have been prepared in accordance with the requirements of the International Accounting Standard 34 - 'Interim Financial Reporting' and provisions of and directives issued under the Companies Ordinance, 1984 (the Ordinance). In case where requirements differ, the provisions of or directives issued under the Ordinance have been followed.

2.2 This condensed interim unconsolidated financial information is being submitted to the shareholders in accordance with

section 245 of the Ordinance and should be read in conjunction with the audited financial statements of the Company for the year ended December 31, 2016.

3 ACCOUNTING POLICIES The accounting policies and the methods of computation adopted in the preparation of this condensed interim

unconsolidated financial information are the same as those applied in the preparation of audited annual financial statements of the Company for the year ended December 31, 2016.

4 ACCOUNTING ESTIMATES AND JUDGEMENTS 4.1 The preparation of this condensed interim unconsolidated financial information in conformity with the approved

accounting standards requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company's accounting policies. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectation of future events that are believed to be reasonable under the circumstances. However, actual results may differ from these estimates.

4.2 However, management believe that the change outcome of these judgement, accounting estimates and assumptions would

not have any material affect on the amounts disclosed in condensed interim financial information of the entity. 5 FINANCIAL RISK MANAGEMENT The financial risk management objectives and policies are consistent with those disclosed in the annual audited

unconsolidated financial statements of the Company as at and for the year ended December 31, 2016.

FOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

NOTES TO THE CONDENSED INTERIM UNCONSOLIDATED FINANCIAL INFORMATION


6.3 The following assets were disposed / written off during the period/ year: June 30, 2017 (unaudited) (27,496) 3,959 (23,537) December 31, 2016 (audited) (refer note 5.1) (60,196) 6,546 (53,650)

CostAccumuladedDepreciation

Net BookValue

6 PROPERTY, PLANT AND EQUIPMENT Operating fixed assets 6.1 5,321,217 5,214,536 Capital work-in-progress 6.4 5,191,151 3,474,411 10,512,368 8,688,947 6.1 Opening book value 5,214,536 4,220,584 Additions during the period 6.2 382,911 1,446,744 Disposal (23,537) (53,650) Depreciation (252,693) (399,142) Closing book value 5,321,217 5,214,536

6.2 Additions to operating assets during the period/ year were as follows:

Owned assets Land - 31,557 Depot building - 80,341 Pump building 98,939 340,335 Tanks and pipelines 25,000 185,597 Dispensing pumps 50,295 22,117 Plant and machinery - 28,920 Electrical, mechanical and fire fighting equipment's 1,085 167,866 Furniture, office equipment and other assets 216 69,623 Vehicles 31,880 66,877 Computer auxiliaries 786 18,408 208,201 1,011,641 Leased assets Building on leasahold land - 7,526 Dispensing Pumps - 35,040 Plant and Machinery - 37,320 Electrical, mechanical and fire fighting equipments - 5,185 Vehicles 174,710 350,032 174,710 435,103 382,911 1,446,744




Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


6.4 Capital work-in-progress

Office building 434,576 350,283 Depot building 1,494,251 1,251,710 Pump building 414,976 250,137 Plant and machinery 301,749 22,319 Tanks and pipelines 1,184,428 649,540 Dispensing pumps 181,645 96,357 Computer auxilliaries 17,079 7,045 Electrical, mechanical and fire fighting equipment's 469,232 365,453 Furniture, office equipments and other assets 162,332 107,768 Vehicles 180,886 109,971 Borrowing cost capitalized 197,950 123,214 Advances to contractors 152,047 140,614 5,191,151 3,474,411

7 LONG-TERM INVESTMENTS Investment in Subsidiary - unquoted Subsidiary - at cost 7.1 75,000 75,000 Available for sale - quoted Pakistan Refinery Limited 7.2 2,303,469 1,886,977 2,378,469 1,961,977

7.1 Unquoted subsidiary company - at cost

CostNote

ProvisionFor

Impairment

June 30,2017

Un-audited

December 31,2016

Audited

Carrying Value

7.1.1 Hascombe Lubricants (Private) Limited is wholly owned subsidiary of the Company, incorporated in Pakistan under the Companies Ordinance,1984. Company holds 9.78 million ordinary shares (December 31, 2016: 9.78 million) of Rs. 10 per share. The Company is involved in the business of blending and producing of lubricating oils, greases and other petroleum products.

7.1.2 The Company subscribed 7.5 million shares of Hascol Terminal Limited (HTL) at a subscription price of Rs.10 each, which

represent 62.5% of the share capital of HTL. These shares are not quoted on an active market and have been carried at cost. The Company provides storage facilities for imported and locally produced petroleum and related products.




Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


Hascombe Lubricant (Private) Limited 7.1.1 30,604 (30,604) - - Hascol Terminals Limited 7.1.2 75,000 - 75,000 75,000 105,604 (30,604) 75,000 75,000




9 DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES

Current portion of lease deposits 32,164 5,740 Prepaid rent 63,751 66,616 Prepaid insurance and others 26,574 14,001 Receivable from oil marketing companies 9.1 44,658 11,328 Receivable against regulatory duty 25,533 25,533 Inland Freight Equalization Margin (IFEM) receivable 1,775,972 1,024,234 Franchise income receivable 69,652 73,304 Price differential claims 9.2 5,083 5,083 Others 9.3 44,579 60,909 2,087,966 1,286,748 9.1 This represents amount receivable from various Oil Marketing Companies (OMCs) on account of share of motor gasoline

imported by the Company on behalf of various OMCs. 9.2 This represents amount receivable from the Government of Pakistan (GoP) net of recovery as per fortnightly rates

declared by the Ministry of Petroleum and Natural Resources (MPNR). The Company together with other oil marketing companies is actively perusing the matter with the concerned authorities for the early settlement of above claim. The Company considers that the balance amount will be reimbursed by GoP in due course of time.

9.3 This includes Rs. 7.28 million (December 31, 2016: Rs. 4.45 million) receivable from Sigma Motors (Private) Limited.

Note

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


7.2.1 Investment in Pakistan Refinery Limited (quoted) amounts to Rs. 1,172.77 million (December 31, 2016 : Rs. 1,172.77 million) representing 13.72% (December 31, 2016: 13.72%) shares in PRL as at June 30, 2017. The Company has 43.24 million shares (December 31, 2016 : 43.24 million shares) as at June 30, 2017.

8 This includes advance against future issue of shares provided to subsidiaries, namely Hascol Terminals Limited and Hascol

Lubricant (Private) Limited, amounting to Rs. 401.908 million and Rs. 2.013 million respectively, and to VAS LNG (Private) Limited (an associated Company), amounting to Rs. 4.023 million respectively.

7.2 Pakistan Refinery Limited - available for sale

June 30, 2017 7.2.1 1,172,772 1,130,697 2,303,469 December 31, 2016 1,172,772 714,205 1,886,977

Cost Unrealizedgain

CarryingValue




10 LONG TERM FINANCES - Secured

Term finance facility 1,413,816 945,007 Sukuk certificate 10.1 & 10.2 1,866,588 1,961,821 3,280,404 2,906,828 Less: Current portion of long term finances Term finance facility 503,007 299,079 Sukuk certificate 400,000 300,000 903,007 599,079 2,377,397 2,307,749

10.1 Sukuk certificate 1,900,000 2,000,000 Issuance cost Opening (38,179) - Addition - (47,731) Charged to profit and loss account 4,767 9,552 (33,412) (38,179) 1,866,588 1,961,821

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


10.2 This represent privately placed long term islamic certificate (Sukuk) amounting to Rs. 2,000 million, issued by the Company during the year to meet the working capital requirement and expansion plans of the Company. Summit Bank Limited is the trustee while Meezan Bank Limited is acting as shariah structuring advisor for this Sukuk. The Company is in the process of listing of Sukuk over the counter (OTC) on Pakistan Stock Exchange. This facility carries profit at 3 month KIBOR plus 1.5% per annum, payable quarterly. This arrangement is secured against first pari-passu charge over specific depots and retail outlets of the Company inclusive of a 25% margin. The certificates will be redeemed in 20 equal quarterly installments, in arrears, started from April 2017.

11 DEFERRED TAXATION - net

This comprises the following: Taxable temporary difference arising in respect of: Accelerated depreciation (389,735) (354,233) Assets under finance lease (151,219) (129,683) Revaluation of fixed assets (468,264) (513,467) Exchange gain - (1,797) Surplus on remeasurement on investment (84,803) (89,276) Deductible temporary difference arising in respect of: Liabilities against assets subject to finance lease 189,100 182,677 Provision for : - retirement benefit 45,587 40,718 - doubtful debts 2,348 2,358 - franchise income 8,133 8,168 Investments in subsidiary 9,101 9,140 Turnover tax 125,303 250,605 (714,449) (594,790)

UnauditedJune 30,

2017

AuditedDecember 31,

2016

12 TRADE AND OTHER PAYABLES

Trade creditors 28,000,128 22,258,817 Payable to cartage contractors 2,952,841 2,445,673 Advance from customers 4,156,576 4,253,932 Dealers' and customers' security deposits 201,700 170,000 Accrued liabilities 8,024 6,153 Other liabilities 687,959 688,183 36,007,228 29,822,758 13 CONTINGENCIES AND COMMITMENTS 13.1 Contingencies 13.1.1 As per the deliberations of the Main Committee of the Oil Companies Advisory Committee (OCAC) held in their

meeting number MCM-168 dated September 20, 2007, the financial costs on outstanding Price Differential Claims (PDC) should be worked and billed to the Government of Pakistan (GOP) through OCAC by the Oil Marketing Companies (OMCs) on a regular basis. Although the Company had billed Rs 65.97 million (December 31, 2016: 65.97 million) to the GOP/ OCAC, the management had not accounted for its impact in these financial statements as the inflow of economic benefits, though probable, is not virtually certain.

13.1.2 The Company has filed appeal before the Commissioner Appeals against the Order-in-Original No 06/2017 dated June

07, 2017 for the tax periods from January 2015 to December 2015 passed by Deputy Commissioner Inland Revenue raising tax demand of Rs. 125 million mainly relating to the matter of zero rating of supply of oil to international ships. The Company is confident that the matter will be decided in its favor.

13.2 Commitments The facility for opening letters of credit (LCs) acceptances as at June 30, 2017 amounted to Rs 33,914 million (December

31, 2016 : Rs 30,550 million) of which the amount remaining unutilized as at that date was Rs 1,884 million (December 31, 2016 : Rs 3,631 million)

Commitments in respect of capital expenditure contracted for but not yet incurred are as follows:

Property, plant and equipment 741,037 758,237




UnauditedJune 30,

2017

AuditedDecember 31,

2016

UnauditedJune 30,

2017

AuditedDecember 31,

2016


UnauditedJune 30,

2017

AuditedDecember 31,

2016





Commitments for rental of assets under operating lease agreements / ijarah contracts as at June 30, 2017 amounted to Rs 1,915 million (December 31, 2016 : Rs 1,984 million) as follows:

Not later than one year 178,501 173,461 Later than one year and not later than five years 643,187 642,427 Later than five years 1,093,759 1,167,834 1,915,447 1,983,722

14 TAXATION Current 450,272 264,947 Prior period 64,619 28,610 Deferred 124,133 80,301 639,024 373,858 15 CASH GENERATED FROM OPERATIONS Profit before taxation 1,429,631 985,885 Adjustment for: Depreciation and amortization 252,693 185,699 Provision for gratuity 17,506 13,754 Gain on sale of fixed assets (741) - Finance cost 262,358 211,013 Changes in working capital 15.1 5,846,041 (1,460,788) 7,807,488 (64,437)15.1 Changes in working capital

(Increase) / decrease in current assets Stock-in-trade 4,489,317 1,006,320 Trade debts (3,802,611) 251,891 Loans and advances - considered good (223,917) 56,562 Sales tax receivable - (1,770,515) Deposits, prepayments and other receivables (801,218) (309,918) (338,429) (765,660) Increase/ (decrease) in current liabilities Trade and other payables 6,184,470 (695,128) 5,846,041 (1,460,788)16 CASH AND CASH EQUIVALENTS Cash and bank balances 11,416,786 3,763,159 Finances utilized under markup arrangements - secured (2,758,137) (1,136,880) 8,658,649 2,626,279

Note

UnauditedJune 30,

2017

UnauditedJune 30,2016


All transactions with related parties have been carried out on arm's length basis.

Expenses recovered from / charged by related parties are based on actual. Key management personnel are those persons having authority and responsibility for planning, directing and controlling

the activities of the Company directly or indirectly. The Company considers its Executive Director and Executives to be key management personnel.

18 OPERATING SEGMENTS

- These financial statements have been prepared on the basis of a single reportable segment. - Sales from petroleum products represents 99.7 % (2016: 99.7%) of total revenues of the Company. - Out of total sales of the Company, 100 % (2016: 100 %) related to customers in Pakistan. - All non-current assets of the Company as at June 30, 2017 are located in Pakistan. - The Company sells its product to dealers, governments agencies and autonomous bodies, independent power project

and other corporate customers. However, none of the customers exceeds 10% threshold.



17 RELATED PARTY TRANSACTIONS AND BALANCES Transactions entered into and balances outstanding with the related parties are as follows:

Nature of relationship Nature of transaction Associated companies Sigma Motors (Private) Limited Office rent 2,818 3,382 Staff retirement benefits / contribution funds Provident fund Contribution 11,162 7,297 Gratuity fund Contribution 17,506 13,754 Key management personnel Salaries and benefits 44,392 36,279 Director Fee Fee for attending meeting 3,600 2,225 Other related parties Consultancy services 8,550 10,325

Balances Associated companies Sigma Motors (Private) Limited Other receivable 7,276 4,458

UnauditedJune 30,

2017

AuditedDecember 31,

2016


UnauditedJune 30,

2017


19 CORRESPONDING FIGURES In order to comply with the requirements of International Accounting Standard 34 - 'Interim Financial Reporting',

corresponding figures in the condensed interim unconsolidated balance sheet comprise of balances as per the audited financial statements of the Company for the year ended December 31, 2016 and the corresponding figures in the condensed interim unconsolidated statement of comprehensive income, condensed interim unconsolidated statement of changes in equity and condensed interim unconsolidated statement of cash flows comprise of balances of comparable period as per the condensed interim unconsolidated financial information of the Company for the six months ended June 30, 2017.

20 EVENTS AFTER BALANCE SHEET DATE The Board of Directors has declared an interim cash dividend of Rs. 3.50 per share amounting to Rs. 422.37 million at this

meeting held on August 30, 2017. These financial information do not reflect this appropriation.

21 DATE OF AUTHORISATION These condensed interim unconsolidated financial information have been authorized for issue on August 30, 2017 by the

board of directors of the Company.

22 GENERAL All amounts have been rounded to the nearest thousand, rupees.








for the six months period ended June 30, 2017

ASSETS

Non-current assets Property, plant and equipment 6 11,921,177 9,424,264 Long-term investments 7 2,303,469 1,886,977 Long-term deposits 293,411 290,362 Total non-current assets 14,518,057 11,601,603

Current assets Stock-in-trade 11,988,351 16,477,668 Trade debts 11,673,892 7,871,281 Advances 8 75,422 44,605 Deposits, prepayments and other receivables 9 2,103,198 1,297,628 Cash and bank balances 11,663,836 7,832,284 Total current assets 37,504,699 33,523,466

Total assets 52,022,756 45,125,069

EQUITY AND LIABILITIES Authorized share capital 1,500,000 1,500,000

Shareholders' equity Share capital 1,206,792 1,206,792 Reserves 4,574,136 3,746,665 Total shareholders' equity 5,780,928 4,953,457

Non-controlling interest 1,054,814 469,714 6,835,742 5,423,171

Surplus on revaluation of fixed assets - net of tax 1,092,615 1,142,880

LIABILITIES

Non-current liabilities Long term finances - secured 10 2,377,397 2,307,749 Liabilities against assets subject to finance lease 562,359 471,731 Deferred taxation - net 11 714,449 594,790 Deferred liability - gratuity 153,297 135,791 Total non-current liabilities 3,807,502 3,510,061

Current liabilities Trade and other payables 12 36,169,562 29,836,808 Mark-up accrued 82,164 91,185 Short term borrowings 2,758,137 3,889,629 Current portion of long term finances 10 903,007 599,079 Current maturity of liabilities against assets subject to finance lease 73,527 148,387 Taxation 300,500 483,869 Total current liabilities 40,286,897 35,048,957

Total liabilities 44,094,399 38,559,018

Total equity and liabilities 52,022,756 45,125,069

Contingencies and commitments 13 The annexed notes from 1 to 22 form an integral part of these condensed interim consolidated financial information.

CONDENSED INTERIM CONSOLIDATED BALANCE SHEETAS AT JUNE 30, 2017

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016



The Chief Executive Officer is for the time being not in Pakistan therefore, these condensed interim consolidated financial statements have been signed by two directors.



CONDENSED INTERIM CONSOLIDATED PROFIT AND LOSS ACCOUNT - UnauditedFOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

Sales - net 94,552,773 59,260,277 51,750,587 30,767,436 Sales tax (17,022,134) (15,964,165) (9,028,283) (7,792,049)Net sales 77,530,639 43,296,112 42,722,304 22,975,387 Other revenue 211,890 70,852 125,774 39,284 Net revenue 77,742,529 43,366,964 42,848,078 23,014,671 Cost of products sold (74,692,636) (41,197,394) (41,226,211) (21,607,327)Gross profit 3,049,893 2,169,570 1,621,867 1,407,344 Operating expenses Distribution and marketing (1,167,850) (771,993) (627,697) (414,030)Administrative (320,266) (258,263) (167,268) (137,109) 1,561,777 1,139,314 826,902 856,205 Other income 133,675 90,044 66,742 36,890 Operating profit 1,695,452 1,229,358 893,644 893,095 Finance cost (262,358) (211,013) (148,489) (108,178)Other (charges)/ income (22,647) (32,460) 444 (34,848)Profit before taxation 1,410,447 985,885 745,599 750,069 Taxation 14 (639,024) (373,858) (346,506) (340,251) Profit for the period 771,423 612,027 399,093 409,818

Profit / (Loss) attributable to: Equity holders of the holding company 778,617 612,027 404,638 409,818 Non-controlling interest (7,194) - (5,545) - 771,423 612,027 399,093 409,818 Earning per share - basic & diluted Rupees 6.45 5.07 3.35 3.40 The annexed notes from 1 to 22 form an integral part of these condensed interim consolidated financial information.

NoteJune 30,

2017June 30,

2017June 30,2016


June 30,2016







CONDENSED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - Unaudited FOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

Profit for the period 771,423 612,027 399,093 409,818

Other comprehensive income:

Items that may be re-classified subsequently to profit and loss account

Unrealized gain/ (loss) due to change in fair value of long term investment classified as 'available-for-sale' - net of tax 420,964 (152,509) (944,044) (68,119) Total comprehensive income 1,192,387 459,518 (544,951) 341,699 Total comprehensive income / (loss) attributable to:

Equity holders of the holding company 1,199,581 459,518 (539,406) 341,699 Non-controlling interest (7,194) - (5,545) - 1,192,387 459,518 (544,951) 341,699

The annexed notes from 1 to 22 form an integral part of these condensed interim consolidated financial information.

June 30,2017

June 30,2017

June 30,2016


June 30,2016






CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - UnauditedFOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

Balance as at January 01, 2016 1,206,792 1,070,828 684,721 1,565,856 4,528,197 - 4,528,197 Total comprehensive income for the six months Profit for the period - - - 612,027 612,027 - 612,027 Other comprehensive income Unrealized loss due to change in fair value of long term investment classified as 'available-for-sale' - net of tax - - (152,509) - (152,509) - (152,509) Total comprehensive income for the six months - - (152,509) 612,027 459,518 - 459,518 Transferred from surplus on revaluation of fixed assets on account of incremental depreciation - net of tax - - - 64,918 64,918 - 64,918 - - (152,509) 676,945 524,436 - 524,436 Transaction with owners Final dividend at Rs. 3.5 per share December 31, 2015 - - - (422,377) (422,377) - (422,377)Total transaction with owners - - - (422,377) (422,377) - (422,377) Balance as at June 30, 2016 1,206,792 1,070,828 532,212 1,820,424 4,630,256 - 4,630,256 Balance as at January 01, 2017 1,206,792 1,070,828 624,930 2,050,907 4,953,457 469,714 5,423,171 Total comprehensive income for the six months Profit for the period - - - 778,617 778,617 (7,194) 771,423 Other comprehensive income Unrealized gain due to change in fair value of long term investment classified as 'available-for-sale' - net of tax - - 420,964 - 420,964 - 420,964 Total comprehensive income for the six months - - 420,964 778,617 1,199,581 (7,194) 1,192,387 Transferred from surplus on revaluation of fixed assets on account of incremental depreciation - net of tax - - - 50,267 50,267 - 50,267 - - 420,964 828,884 1,249,848 (7,194) 1,242,654 Transaction with owners Final dividend at Rs. 3.5 per share December 31, 2016 - - - (422,377) (422,377) - (422,377)Consideration for acquisition of subsidary - - - - - 592,294 592,294 Total transaction with owners - - - (422,377) (422,377) 592,294 169,917 Balance as at June 30, 2017 1,206,792 1,070,828 1,045,894 2,457,414 5,780,928 1,054,814 6,835,742 The annexed notes from 1 to 22 form an integral part of these condensed interim consolidated financial information.


ShareCapital

Share premium

Fairvalue

reserve

Unappropri-ated profit

RevenuereserveCapital reserve Total

shareholders'equity

Non-controlling

interestTotal




Note


CASH FLOWS FROM OPERATING ACTIVITIES Cash generated from/ (used) in operations 15 8,125,336 (64,437)Finance cost paid (271,379) (179,213)Dividend paid (422,377) (422,377)Gratuity paid - (790)Taxes paid (698,260) (341,907)Net cash generated from/ (used) in operating activities 6,733,320 (1,008,724) CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditure incurred (2,773,133) (1,269,092)Proceeds from disposal of property, plant and equipment 24,268 - Long term deposits (3,049) 18,950 Net cash used in investing activities (2,751,914) (1,250,142) CASH FLOWS FROM FINANCING ACTIVITIES Lease liability obtained/ (repaid) - net 15,768 (48,584)Long term deposits - (17,143)Contribution of NCI in subsidary company 592,294 - Long term finance obtained and repaid - net 373,576 2,292,380 Net cash generated from financing activities 981,638 2,226,653 Net increase/(decrease) in cash and cash equivalents 4,963,044 (32,213) Cash and cash equivalents as at the beginning of the period 3,942,655 2,658,948 Cash and cash equivalents as at the end of the period 16 8,905,699 2,626,735 The annexed notes from 1 to 22 form an integral part of these condensed interim consolidated financial information.

CONDENSED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS - UnauditedFOR THE SIX MONTHS PERIOD ENDED JUNE 30, 2017

June 30,2017

June 30,2016

Six months period ended





1 STATUS AND NATURE OF BUSINESS The Group consists of:

Name of company Status in the Group Percentage of holding Hascol Petroleum Limited Holding company Hascombe Lubricants (Private) Limited Subsidiary company 100% Hascol Terminals Limited Subsidiary company 62.50% Hascol Petroleum Limited (the Holding Company) was incorporated in Pakistan as a private limited company on March

28, 2001. On September 12, 2007 the Holding Company was converted into a public unlisted company and on May 12, 2014 the Holding Company was listed on the Pakistan Stock Exchange. The registered office of the Holding Company is situated at Suite No. 105-106, The Forum, Khayaban-e-Jami, Clifton, Karachi.

The Holding Company is engaged in the business of procurement, storage and marketing of petroleum and related

products, for which the Holding Company obtained oil marketing license from Ministry of Petroleum and Natural Resources in the year 2005.

Subsidiaries Hascombe Lubricants (Private) Limited Hascombe Lubricants (Private) Limited is a wholly owned subsidiary of the Holding Company which is incorporated in

Pakistan.

Hascol Terminals Limited Hascol Terminals Limited is a subsidiary of the Holding Company which is incorporated in Pakistan. The subsidary provides

storage facilities for imported and locally produced petroleum and related products. 2 BASIS OF PREPARATION 2.1 The condensed interim Consolidated financial information of the Group for the six months period ended June 30, 2017

are unaudited and have been prepared in accordance with the requirements of the International Accounting Standard 34 - 'Interim Financial Reporting' and provisions of and directives issued under the Companies Ordinance, 1984 (the Ordinance). In case where requirements differ, the provisions of or directives issued under the Ordinance have been followed.

2.2 This condensed interim Consolidated financial information is being submitted to the shareholders in accordance with

section 245 of the Ordinance and should be read in conjunction with the audited financial statements of the Group for the year ended December 31, 2016.

3 ACCOUNTING POLICIES The accounting policies and the methods of computation adopted in the preparation of this condensed interim

Consolidated financial information are the same as those applied in the preparation of audited annual financial statements of the Group for the year ended December 31, 2016.


NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL INFORMATION





6 PROPERTY, PLANT AND EQUIPMENT Operating fixed assets 6.1 5,985,345 5,878,664 Capital work-in-progress 6.4 5,935,832 3,545,600 11,921,177 9,424,264 6.1 Opening book value 5,878,664 4,220,584 Additions during the period 6.2 382,911 2,110,872 Disposal (23,537) (53,650) Depreciation (252,693) (399,142) Closing book value 5,985,345 5,878,664 6.2 Additions to operating assets during the period/ year were as follows:

Owned assets Land - 695,685 Depot building - 80,341 Pump building 98,939 340,335 Tanks and pipelines 25,000 185,597 Dispensing pumps 50,295 22,117 Plant and machinery - 28,910 Electrical, mechanical and fire fighting equipment's 1,085 167,866 Furniture, office equipment and other assets 216 69,623 Vehicles 31,880 66,877 Computer auxiliaries 786 18,408 208,201 1,675,759

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


4 ACCOUNTING ESTIMATES AND JUDGEMENTS 4.1 The preparation of this condensed interim Consolidated financial information in conformity with the approved accounting

standards requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectation of future events that are believed to be reasonable under the circumstances. However, actual results may differ from these estimates.

4.2 However, management believe that the change outcome of these judgement, accounting estimates and assumptions would

not have any material affect on the amounts disclosed in condensed interim financial information of the entity.

5 FINANCIAL RISK MANAGEMENT The financial risk management objectives and policies are consistent with those disclosed in the annual audited

Consolidated financial statements of the Group as at and for the year ended December 31, 2016.

6.3 The following assets were disposed / written off during the period/ year: June 30, 2017 (unaudited) (27,496) 3,959 (23,537) December 31, 2016 (audited) (refer note 5.1) (60,196) 6,546 (53,650)

CostAccumuladedDepreciation

Net BookValue

6.4 Capital work-in-progress

Office building 434,576 350,283 Depot building 1,494,251 1,258,004 Pump building 414,976 250,137 Plant and machinery 323,860 22,319 Tanks and pipelines 1,356,068 649,540 Dispensing pumps 181,645 96,357 Computer auxilliaries 17,079 7,045 Electrical, mechanical and fire fighting equipment's 469,232 365,453 Furniture, office equipments and other assets 162,332 110,014 Vehicles 180,886 109,971 Borrowing cost capitalized 197,950 123,214 Advances to contractors 702,977 203,263 5,935,832 3,545,600

7 LONG-TERM INVESTMENTS Available for sale - quoted Pakistan Refinery Limited 7.1 2,303,469 1,886,977




UnauditedJune 30,

2017

AuditedDecember 31,

2016

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


Leased assets Building on leasahold land - 7,526 Dispensing Pumps - 35,040 Plant and Machinery - 37,320 Electrical, mechanical and fire fighting equipments - 5,185 Vehicles 174,710 350,032 174,710 435,103 382,911 2,110,862




9 DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES

Current portion of lease deposits 32,164 5,740 Prepaid rent 78,983 69,462 Prepaid insurance and others 26,574 14,001 Receivable from oil marketing companies 9.1 44,658 11,328 Receivable against regulatory duty 25,533 25,533 Inland Freight Equalization Margin (IFEM) receivable 1,775,972 1,024,234 Franchise income receivable 69,652 73,304 Price differential claims 9.2 5,083 5,083 Others 9.3 44,579 68,943 2,103,198 1,297,628 9.1 This represents amount receivable from various Oil Marketing Companies (OMCs) on account of share of motor gasoline

imported by the Group on behalf of various OMCs. 9.2 This represents amount receivable from the Government of Pakistan (GoP) net of recovery as per fortnightly rates

declared by the Ministry of Petroleum and Natural Resources (MPNR). The Group together with other oil marketing companies is actively perusing the matter with the concerned authorities for the early settlement of above claim. The Group considers that the balance amount will be reimbursed by GoP in due course of time.

9.3 This includes Rs. 7.28 million (December 31, 2016: Rs. 4.45 million) receivable from Sigma Motors (Private) Limited.

Note

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


7.1.1 Investment in Pakistan Refinery Limited (quoted) amounts to Rs. 1,172.77 million (December 31, 2016 : Rs. 1,172.77 million) representing 13.72% (December 31, 2016: 13.72%) shares in PRL as at June 30, 2017. The Group has 43.24 million shares (December 31, 2016 : 43.24 million shares) as at June 30, 2017.

8 This includes advance against future issue of share by VAS LNG (Private) Limited (related party), an associate entity of the

Group and Hascol Lubricant (Private) Limited (related party), a subsidiary of the Group amounting to Rs. 4.023 million and Rs. 2.013 million respectively.

7.1 Pakistan Refinery Limited - available for sale

June 30, 2017 7.1.1 1,172,772 1,130,697 2,303,469 December 31, 2016 1,172,772 714,205 1,886,977

Cost Unrealizedgain

CarryingValue




10 LONG TERM FINANCES - Secured

Term finance facility 1,413,816 945,007 Sukuk certificate 10.1 & 10.2 1,866,588 1,961,821 3,280,404 2,906,828 Less: Current portion of long term finances Term finance facility 503,007 299,079 Sukuk certificate 400,000 300,000 903,007 599,079 2,377,397 2,307,749 10.1 Sukuk certificate 1,900,000 2,000,000 Issuance cost Opening (38,179) - Addition - (47,731) Charged to profit and loss account 4,767 9,552 (33,412) (38,179) 1,866,588 1,961,821

Note

UnauditedJune 30,

2017

AuditedDecember 31,

2016


10.2 This represent privately placed long term islamic certificate (Sukuk) amounting to Rs. 2,000 million, issued by the Group during the year to meet the working capital requirement and expansion plans of the Group. Summit Bank Limited is the trustee while Meezan Bank Limited is acting as shariah structuring advisor for this Sukuk. The Group is in the process of listing of Sukuk over the counter (OTC) on Pakistan Stock Exchange. This facility carries profit at 3 month KIBOR plus 1.5% per annum, payable quarterly. This arrangement is secured against first pari-passu charge over specific depots and retail outlets of the Group inclusive of a 25% margin. The certificates will be redeemed in 20 equal quarterly installments, in arrears, started from April 2017.

11 DEFERRED TAXATION - net

This comprises the following: Taxable temporary difference arising in respect of: Accelerated depreciation (389,735) (354,233) Assets under finance lease (151,219) (129,683) Revaluation of fixed assets (468,264) (513,467) Exchange gain - (1,797) Surplus on remeasurement on investment (84,803) (89,276) Deductible temporary difference arising in respect of: Liabilities against assets subject to finance lease 189,100 182,677 Provision for : - retirement benefit 45,587 40,718 - doubtful debts 2,348 2,358 - franchise income 8,133 8,168 Investments in subsidiary 9,101 9,140 Turnover tax 125,303 250,605 (714,449) (594,790)

UnauditedJune 30,

2017

AuditedDecember 31,

2016

12 TRADE AND OTHER PAYABLES

Trade creditors 28,162,462 22,260,329 Payable to cartage contractors 2,952,841 2,445,673 Advance from customers 4,156,576 4,253,932 Dealers' and customers' security deposits 201,700 170,000 Accrued liabilities 8,024 16,144 Other liabilities 687,959 690,730 36,169,562 29,836,808 13 CONTINGENCIES AND COMMITMENTS 13.1 Contingencies 13.1.1 As per the deliberations of the Main Committee of the Oil Companies Advisory Committee (OCAC) held in their

meeting number MCM-168 dated September 20, 2007, the financial costs on outstanding Price Differential Claims (PDC) should be worked and billed to the Government of Pakistan (GOP) through OCAC by the Oil Marketing Companies (OMCs) on a regular basis. Although the Group had billed Rs 65.97 million (December 31, 2016: 65.97 million) to the GOP/ OCAC, the management had not accounted for its impact in these financial statements as the inflow of economic benefits, though probable, is not virtually certain.

13.1.2 The Group has filed appeal before the Commissioner Appeals against the Order-in-Original No 06/2017 dated June 07,

2017 for the tax periods from January 2015 to December 2015 passed by Deputy Commissioner Inland Revenue raising tax demand of Rs. 125 million mainly relating to the matter of zero rating of supply of oil to international ships. The Group is confident that the matter will be decided in its favor.

13.2 Commitments The facility for opening letters of credit (LCs) acceptances as at June 30, 2017 amounted to Rs 33,914 million (December

31, 2016 : Rs 30,550 million) of which the amount remaining unutilized as at that date was Rs 1,884 million (December 31, 2016 : Rs 3,631 million)

Commitments in respect of capital expenditure contracted for but not yet incurred are as follows:

Property, plant and equipment 741,037 758,237




UnauditedJune 30,

2017

AuditedDecember 31,

2016

UnauditedJune 30,

2017

AuditedDecember 31,

2016


UnauditedJune 30,

2017

AuditedDecember 31,

2016





Commitments for rental of assets under operating lease agreements / ijarah contracts as at June 30, 2017 amounted to Rs 1,915 million (December 31, 2016 : Rs 1,984 million) as follows:

Not later than one year 178,501 173,461 Later than one year and not later than five years 643,187 642,427 Later than five years 1,093,759 1,167,834 1,915,447 1,983,722

14 TAXATION Current 450,272 264,947 Prior period 64,619 28,610 Deferred 124,133 80,301 639,024 373,858 15 CASH GENERATED FROM OPERATIONS Profit before taxation 1,410,447 985,885 Adjustment for: Depreciation and amortization 252,693 185,699 Provision for gratuity 17,506 13,754 Gain on sale of fixed assets (741) - Finance cost 262,358 211,013 Changes in working capital 15.1 6,183,073 (1,460,789) 8,125,336 (64,437)15.1 Changes in working capital (Increase) / decrease in current assets Stock-in-trade 4,489,317 1,006,320 Trade debts (3,802,611) 251,891 Loans and advances - considered good (30,817) 56,562 Sales tax receivable - (1,770,515) Deposits, prepayments and other receivables (805,570) (309,918) (149,681) (765,660) Increase/ (decrease) in current liabilities Trade and other payables 6,332,754 (695,129) 6,183,073 (1,460,789)

16 CASH AND CASH EQUIVALENTS Cash and bank balances 11,663,836 3,763,615 Finances utilized under markup arrangements - secured (2,758,137) (1,136,880) 8,905,699 2,626,735

Note

UnauditedJune 30,

2017


All transactions with related parties have been carried out on arm's length basis.

Expenses recovered from / charged by related parties are based on actual.

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group directly or indirectly. The Group considers its Executive Director and Executives to be key management personnel.

18 OPERATING SEGMENTS

- These financial statements have been prepared on the basis of a single reportable segment. - Sales from petroleum products represents 99.7 % (2016: 99.7%) of total revenues of the Group. - Out of total sales of the Group, 100 % (2016: 100 %) related to customers in Pakistan. - All non-current assets of the Group as at June 30, 2017 are located in Pakistan. - The Group sells its product to dealers, governments agencies and autonomous bodies, independent power project and

other corporate customers. However, none of the customers exceeds 10% threshold.



17 RELATED PARTY TRANSACTIONS AND BALANCES Transactions entered into and balances outstanding with the related parties are as follows:

Nature of relationship Nature of transaction Associated companies Sigma Motors (Private) Limited Office rent 2,818 3,382 Staff retirement benefits / contribution funds Provident fund Contribution 11,162 7,297 Gratuity fund Contribution 17,506 13,754 Key management personnel Salaries and benefits 44,392 36,279 Director Fee Fee for attending meeting 3,600 2,225 Other related parties Consultancy services 8,550 10,325

Balances Associated companies Sigma Motors (Private) Limited Other receivable 7,276 4,458

UnauditedJune 30,

2017

AuditedDecember 31,

2016



UnauditedJune 30,

2017


19 CORRESPONDING FIGURES In order to comply with the requirements of International Accounting Standard 34 - 'Interim Financial Reporting',

corresponding figures in the condensed interim Consolidated balance sheet comprise of balances as per the audited financial statements of the Group for the year ended December 31, 2016 and the corresponding figures in the condensed interim Consolidated statement of comprehensive income, condensed interim Consolidated statement of changes in equity and condensed interim Consolidated statement of cash flows comprise of balances of comparable period as per the condensed interim Consolidated financial information of the Group for the six months ended June 30, 2017.

20 EVENTS AFTER BALANCE SHEET DATE The Board of Directors has declared an interim cash dividend of Rs. 3.50 per share amounting to Rs. 422.37 million at this

meeting held on August 30, 2017. These financial information do not reflect this appropriation.

21 DATE OF AUTHORISATION These condensed interim Consolidated financial information have been authorized for issue on August 30, 2017 by the

board of directors of the Group. 22 GENERAL All amounts have been rounded to the nearest thousand, rupees.








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