fm^zars - egytransir.egytrans.com/pdf/financial/consolidated financial... · 2011. 11. 14. · eng....

MOSTAFA SHAWKI& CO

EGYPTIAN TRANSPORT&

COMMERCIAL SERVICES CO.

(EGYTRANS)S.A.E

INTERIM CONSOLIDATED FINANCIAL STATEMENTSTOGETHER WITH R.EVIEW REPORT

FOR THE THREE-MONTHPERIOD ENDED MARCH 31.t.201I

fM^zARS

WMAZARSMOSTAFA SHAWKI& CO

Translation of auditor's reportoriginally issued in Arabic

Report on review of interimconsolidated financial statements

To the board of directors ofEgyptian Transport & Commercial Services Co.

(Egytrans) - S.A.E

Introduction :We have reviewed the accompanying consolidated balance sheet of Egyptian Transport & CommercialServices Co. (Egytrans) S.A.E as at March 31't,2011 and the related consolidated statements of income,

changes in equity and cash flows for the three-month period then ended, and a summary of significant

accounting policies and other explanatory notes. Management is responsible for the preparation and fairpresentation of these interim consolidated financial statements in accordance with Egyptian Accounting

Standard "interim financial statements". Our responsibility is to express a conclusion on these interim

consolidated financial statements based on our review.

Scope ofreview :We conducted our review in accordance with Egyptian Standard on Review Engagements 2410 "Review ofinterim 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 Egyptian Auditing Standards 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.

Oualification:The consolidated financial statements were prepared according to the separate financial statements of the

company, which we have issued our qualified report dated May 24"', 2011 and the financial statements ofEgyptian Transpoftation & Logistics Co. (ETAL) for the three-month period ended march 3 1", 201 I which we

have issued our unqualified review report in May 22no, 2071 and the financial statements of Global Depot

Solution Co., Egytrans for River Ports Co. and Egytrans Barg Link Co. for the three-month period ended

March 3 1't, 201 1 as their auditors have issued their unqualified review repofts in April 19"' , 201 1, except for the

additional explanatory paragraph about Global Depot Solutions Co. which applied IFRS no 17 concerning

finance lease instead of Egyptian Accounting Standard no. 20.

Ouslified conclasion :Based on our review, except for the matters stated in preceding paragraph, nothing has come to our attention

that causes us to believe that the accompanying interim consolidated financial statements does not present

fairly, in all material respects the consolidated financial position of the entity as at March 31't, 2011, and of itsfinancial performance and its cash flows for the three-month period then ended in accordance with Egyptian

Accounting Standards and in light of governing laws.

78 Aaorr Snrau Aner SrREEr, BoRC Er Slrnv. CrvuIEL: (03) 583 1764 - 583 I 765 Fnx: (03) 583 6559E-mall: [email protected] www.mazars.com.

, P.O.Box 360 Sror Crern, ArrxnruoRrA 214l l, Ecypr

eg www.msnawKr.com

Auditor

AZARS Mostafa|day 24th,2011.

(e+AD

Egyptian Transport & Commercial Services Co.(Egvtrans) S.A.E

Interim consolidated Financial statementson March 31",20ll

Translation of financial statementsoriginally issued in Arabic

Consolidated balar-rce sheetas at March 31't.2011

(Amounts expressed in Egyptian Pound)

Note 3ll3l20ll 3Ur2l20l0Non-current assetsFixed assets (net)

Proj ects under constructionLong term investmentsGoodwill

Total non-current assets

Current assetsInventoryTrade receivablesDebtors and other debitsClearance operations in process

Cash on hand and at banks

Total current assets

Current liabilitiesProvisions

Banks overdraftShort term loans installmentsShort term finance lease installmentsTrade payablesDistribution creditorsCreditors and other credits

Total current liabilitiesWorking capitalTotal investment

Shareholders'equifvIssued and subscribed capitalLegal reserveCapital reserveTreasury stockCumulative adjustment on translation of foreign companies

Retained earningsNet profit for period / year

Total shareholders' equityMinority interest

Non-current IiabilitiesLong term loansFinance lease liabilitiesDeferred tax liabilities

Total non-current liabilitiesTotal working capital andnon-current assets

(2d,3)(2f,4)(2g,5)(2h)

(2i,6)(2i,7)

(B)(e)(10)

(2k,1 1)

(2n)(2n,1 8)(2L,12)

(13)(14)(15)

(1 6)(2m)

(2o,17)

32,096,58110,659,52518,786,6',7',7

2,287,60663,830,3 89

32,656,42410,07 5,49116,491,6712,28',7,606

61,511,198

(2b)

(2n,1 8)(2L,12)

(2p)

14,234,51440,418,34928,136,261

7,955,45078,687,421

169,432,007

2,817,452

6,636,3705,280,000

934,1414,066,1852,742,069

20,418,12342,894,346126,531,661

190,368,050

156,062,5003,205,5771,993,777(209,092)(73,141)

7,r37,6344,101,161

166,217,8161,116,070

16,541,2183,392,7243,094,222

23,034,164190,368,050

14,866,69840,575,44927,009,9299,067,052

7 4,7 56,487166,215,615

2,817,452

6,401,6205,280,000

893,0433,429,4092,694,024

16,200,83937.716,381

128,559,228

_J29,019,426

156,062,5001)O5 5'7'l

1,993,17',7

(35,664)2,588,055

163,813,6451,603,759

18,060,027? 5?4 q?0

3,058,07524,653,022

_ t29&J9,426

- The accompanying notes are an integral part of these consolidated financial statements.

-Auditor's report on review of interim consolidated financial statements attached.

Mr. Ahmed Mossad BeheiryBoard member and Financial manager

Eng. Hussam Wael SedikChairman and CEO

Egyptian Transport & Commercial Services Co.(Esytrans) S.A.E

Interim consolidated Financial statementson March 3l't.201I

Translation of financial statementsorisinally issued in Arabic

Consolidated statement of incomeFor the three-months period ended March 31't.2011


Note 3ll3l20ll 3U3/2010

Operations revenues

Operations costs

Gross profit

General and admin. expenses

Selling and distribution expenses

B.O.D. attendance allowances

Decline in clients value

Fixed assets deprecation

Operating profit

Finance cost

Investments revenues

Credit interest

Gain on sale of fixed assets

Foreign currency exchange differenceOther revenues

Net profit for the period before taxIncome taxDeferred tax

Income tax for the periodNet profit for the period

Distributed as follows :

Holding company share

Minority share

Net profit for the period

Earnings per share

(2q,I9)

(2i,20)

(2n)(2e)

(2q)

(2c)

(2b)

(2r,21)

(2i)

(2d)

(2p)(2p)

39,636,566

(32,956,07r)

6,680,495

(4,704,841)

(101,486)

(364,250)

(500,000)

(376,870)

633,048

(264,567)2,305,5961,068,368

(358,016)r,424,2204,808,649(776.22s)

(33,811)(810,036)

_:p23613

4,101,161( 102,548)

__?2234J3_0.09

34,5r9,370

(29,r56,937)

5 ?ffi 477

(3,949,965)

( 108,070)

(291,000)

(289,922)

723,476

(268,432)2,028,848

9,701(1 10)

352,5842,846,06:.(264,274)

(32,223)(296,497)

2,549,570

2,550,r78(608)

2.549.570

0.37

- The accompanying notes are an integral part of these consolidated financial statements.

a'1{\t ,1, {"

1\Ir. Ahmed Mossad BeheiryBoard member and Financial manaqer

Eng. Hussam WaelChairman and CEO

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Interim consolidated Financial statementson March 3l't, 201 I

Translation of financial statementsoriginally issued in Arabic

Consolidated statement of cash flowsFor the three-months ended March 31st. 2011


Note 3ll3l20ll 3ll3l20l0Cash flows from operating activitiesNet profit for the period before taxAdiustmentsDepreciationInvestments revenues in associatesDebit and credit interestGain on sale of fixed assets

Foreign currency exchange differencesAdjustments

Working capital changesDecrease in inventoryDecrease (increase)in trade receivablesIncrease in debtors and other debitsDecrease in clearance operations in process

Increase in trade payablesIncrease in creditors and other creditsCash flow generated from operating activitiesProceeds from credit interestDebit interest paidNet cash flows provided from operating activities

Cash flows from investing activitiesPayments on purchase of fixed assets

Proceeds from sale offixed assets

Paid in projects under constructionNet cash flows used in investing activities

Cash flows from financing activitiesPayments on purchase of treasury stocksRepayments of bank facilitiesDividends payments to minorityDividends paymentsPayments on finance lease installmentsCash flows used in financing activitiesNet changes in cash and cash equivalentsCash and cash equivalents, beginning of the periodCash and cash equivalents, end of the period

'j 'Fe*

4,908,649 2,846,061

1,124,900 319,351

(2,295,000) (1,159,416)(803,801) 258,',731

I l0(74,203)

(2,152,3',77) (417,832)

608,1 68 1,246,951

632.184 2.857,589

1 57,101 (3,7 19,606)

(l .126.338) (432.e3e)

1,111,602 144,8',79

636,776 220,560

3,44r,059 1,289,J26

(2s)

5,460,5521,068,368

(264,56',7)

6 264 353

2,207,1609,701

(268,432)

t,948,429

(2s)(2s)

(264,938)

(50 1,1 70)

(7661108)

(209,092)(1,460,513)

(53,265)( 101,092)

(1,824,022)

3,674,22315,013,204

__J3,687,421_

(219,131)140

(1,9"12,626)

(2,r9r,623)

(73 8,05 5)

(18,365)

(7 s6,420)(999,614)

4.302,1921 10? 57R

,/ ,.{ *' JEng. Hfrssam Wael Sedik Eeheta

Chairman and CEOMr. Ahmed Mossad Beheiry

Board member and Financial manager

Egyptian Transport & Commercial Services Co.(Egytrans) S.A.E

Interim consolidated Financial statementson March 31". 20ll

Translation of fi nancial statementsorisinallv issued in Arabic

Notes to the interim consolidated financial statementsfor the three-months period ended March 31't. 2011


1. The company :

a. Egyptian Transport & Commercial Services Co. (Esytrans) (Holding companv) :

The company was incorporated on September 13tn,lg73 as a limited liability company.

According to the extraordinary general assembly meeting held on January 1", 1987 and

according to law 159 for 1981 the company has changed its legal status to be a Joint Stock

Company.

The company's purpose is to represent ship owners and shipping companies, air freightoperations, shipping agency, stevedoring for dry, bulk and general cargo, transportation and

general services, international transportation by land, sea or air, customs clearance and

shipping, warehousing and storage, container handling and related activities, packing and

exhibition services also storage and selling all kinds of goods through the company's

branch located at port said free zone area.

b.Egyptian Transportation & Loeistics Co. (ETAL) (S.A.E) (Subsidiarv) :

The company was incorporated on December l8th, 1982 according to law 43 for 1974

amended by law 32 for 1977 and its executive regulation with capital amounting L.E

328,000 and the company has increased its issued capital by L.E 7,672,000 to reach L,E 8

million and this increase is registered in commercial register, this increase was totallycontributed by Egytrans.

The company's purpose is presented in vehicles transport of weights that exceed 50 tons

which require studies and technical experience in engineering transportation and

stevedoring.

c. Global Depot Solutions Co. (subsidiarv) :

The company was incorporated on May 4th, 2009 and registered in commercial register

under no. (39549) according to law 159 for 1981 and its executive regulation with capital

amounting US Dollar 100,000, during 2010 the company increased its capital by an

amount of US $ 900,000 to be US $ 1 million, this increase was registered in the

commercial register.The company's purpose is to store, clean and repair liquid poured goods, specially the iso-

tank containers for transporling liquid goods and the transportation vehicles with containers

used to transport liquid goods on land roads.

Notes to interim consolidated financial statements

1-


Interim consolidated Financial statementson March 31't. 201t

d.Egytrans For River Ports Co. (subsidiary) :

The company was incorporated on May 4'h , 2009 and registered in commercial registerunderno.(38542) according to law 159 for 1981 and its executive regulation with capitalamounting L.E 250,000 and the company has increased its issued capital during the periodby L.E 24,750,000 to be L.E 25 million, this increase was totally contributed by Egytrans.

The company's purpose is to manage, operate, use and enhance river ports, river containersstations and to provide all services related to shipping, unloading, storing all kinds ofgoods, transportation activities and containers mobile maintenance.

e. Eeytrans Bars link Co. (subsidiary):

The company was incorporated on September 4th , 2009 and registered in commercialregister under no. (39179) according to law 159 for 1981 and its executive regulation withcapital amounting 250,000 L.E and the company has paid 25o/o of the capital in cash.

The company's purpose is to perform all means of land transportation , use licensed ships

and units for river transportation in addition to transporting goods by sea in the regional

water and trading all types and forms of goods.

2. Significant accounting policies :

A summary of the significant accounting policies, is as follows :

a. Basis of accounting :

The accounts have been prepared according to historical cost and in conformity withEgyptian Accounting Standards and in light of governing laws, financial statements

preparation require assumptions and estimates made by management that affect some

assets, liabilities, revenues and expenses during the financial period and the actual result

might be different than these estimates

b. Basis of consolidation :

Consolidated financial statements include assets, liabilities and operation results of the

holding company and its subsidiary companies that the company holds & they are as

follows:

Subsidiary co.

Egyptian transportation & logistics co.(ETAL)Global depot solutions co.Egytrans for river ports co.Egytrans barg link co.

o During 2010, Egyptian transportation & logistics co. (ETAL) increased its issued capital by an

amount of L.E 7 ,672,000 to be L.E 8 million , this increase was resisted in the commercial register

and was totally contributed by Egtrans resulting in increase in the ownership in this company from95Yo to 99,87'Yo.

o During 2010, global depot solutions co. increased its capital by an amount of US $ 900,000 to be

US $ 1 million, this increase was registered in the commercial register.

o During 2010, Egy'trans For River Ports decided to increase its capital by an amount of L.F 24.75

million to be L.E 25 million, this increase was registered in commercial register and was totallycontributed by Egytrans resulting in increase in ownership in this company from 99.88%

to 99.99Yo.

Ownership

99.87%74.97%99.99%99.88%


2-


Interim consolidated Financial statementson March 31".2011

c.

These consolidated financial statements are prepared according to the following basis:

- Similar items of assets, liabilities, revenues and expenses for group companies are

cumulated together.- All transactions & balances related to the group companies are excluded as well as the

unearned profits that result from these transactions.- Equity method is followed for associates in preparing the consolidated financial

statements.- Minority equity represented by their equity in the subsidiaries company's net assets is

recorded at the date of preparing the consolidated financial statements and reclassified as

a separate item in the consolidated financial statements after shareholders equity, whenminority share in losses exceeds their interest in net assets of the subsidiary companies,the monitory interest is reduced to nill and recognition of further losses is charged to

holding companies owners'equity.- The assets and liabilities of foreign entities are translated to Egyptian Pound at the rates

ruling at the reporting date. The income and expenses of foreign entities are translated to

Egyptian Pound at rates ruling at the transactions date, and for practical purpose,

approximate is rate used to represent the average exchange rates during the financialperiod. Cumulative adjustments on transaction of foreign companies are recognized

directly in equity at the consolidated balance sheet.

Foreign currency :

-The company's functional and reporting currency is the Egyptian Pound, the transactions

in foreign currencies during the year are translated to Egyptian Pound at the rates ruling at

the transaction date. At each period end, monetary assets and liabilities denominated in

other currencies are translated to Egyptian Pounds at the rates ruling at that date.

Translation differences are included in the statement of income.

-Concerning the company's branch at Port Said - free zone, the branch's functional and

reporting currency is US Dollar, the branch financial statement translated at each period

end at the rates rulins at that date. Translation differences are included in the statement ofincome

Fixed assets :

Fixed assets are recognized when it is probable that future economic benefits embodied

with acquired assets will flow to the company and its cost can be reliably measured. Fixedassets are stated at historical cost less accumulated depreciation, and accumulated

impairment losses (if there is any indication of irnpairment in its value) the book value offixed assets is depreciated by straight line method based on their estimated useful lives,using the following rates :

Assets Dep. Rate2%

20%25%r0%20%r0%

BuildingsVehiclesComputers and softwareEquipments and toolsFittingsFurniture and office equipment

d.


3-


Interim consolidated Financial statementson .vlarch 31", 201I

f.

Depreciation for acquired assets is calculated starting from one month after the date ofacquisition or usage of the asset.

Any subsequent costs are capitalizedto related fixed asset as a replacing part only if these

costs are determinable and derive future economic benefits, other repairs and maintenanceexpenses are included in the statement of income as incurred.Intangible assets :

Acquired intangible assets are stated at historical cost less accumulated depreciation, and

accumulated impairment losses (if there is any indication of impairment in its value) Anysubsequent costs are capitalized only if these costs are determinable and derive futureeconomic benefits, other expenses are included in the statement of income as incurred.

Proiects under construction :

Projects under construction include all expenditures directly attributable to acquire fixedassets. Projects under construction are transferred to fixed assets when completed and ready

for intended use.

Long term investments :

Investments in associated companies

Investments in associated companies are stated initially at cost, and they are accounted forusing equity method for the purpose of preparing the consolidated financial statements.

The consolidated financial statements include the groups share of income and expenses ofequity accounted investees after adjustments to align the accounting policies with those the

group, from the date that significant influence commences until the date that significant

influence cases. In case of impairment, the carrying amount of the investments is reduced

and the impairment loss is charged to consolidated statement of income.

When the group's share of losses exceeds its interest in an equity accounted investee, the

carrying amount of that interest is reduced to nil and recognition of further losses is

discounted.

Available for sale investments :

Available for sale investments are recorded initially at cost .investments available for-sale

that are listed in stock exchange are re-measured at fair value at the end of each reportingperiod and changes therein, other than impairment losses which charged to statement ofincome, are recognized in shareholder's equity. when the investment is derecognized, the

cumulative gain or loss in shareholder's equity is transferred to the consolidated income

statement. investments which are not listed at stock exchanges are re-measured at historical

value after reducing any impairment losses.

h. Goodwill:Goodwill represents the excess of the cost of acquisition over the parent company's interest

in the net fair value of the identifiable assets, liabilities and contingent liabilities of acquired

company. Goodwill is stated at cost less any accumulated impairment losses. Goodwill is

not depreciable but its book value is regularly reviewed to determine whether there is any

indications of impairment in its value, if such indications exist the asset's residual value is

estimated. Impairment of goodwill is included in statement of income and not reversed

subsequently.

e.

g.


4-


Interim consolidated Financial statementson March 31", 20ll

i. Inventory:The clients and notes receivable balance is stated at the netthe decline in clients and notes receivable value whichmanagement estimates; these estimates are reviewed at thereflect the best current estimate.

realizable value after deductingis determined according to theend of each financial period to

j. Trade receivables :

Trade receivables notes balance is stated at the net realizable value after deducting thedecline in clients and notes receivable value which is determined according to themanagement estimates, these estimates are reviewed at the end of each financial period to

reflect the best current estimate.

Provisions :

A provision is recognized when an entity has a present legal obligation as a result of past

event, the amount of the obligation can be reliably estimated, and it is probable that an

outflow of economic benefit will be required to settle the obligation, provision is reviewedat the end of each period and restated to reflect management estimates. The amount

recognized as a provision should represent the present value of the expected outflows to

settle the obligation.

Finance leasing :

According to the finance leasing agreement with the international company for leasing -Incolease, notes (3) and (13) leased assets are recognized in projects under constructionwith the current value of the minimum limit of the lease payments which will be

depreciated on their estimated useful lives according to the policies applicable on similarassets when transferred to fixed assets, the debt will be stated in the non-current liabilities -finance leasing agreements (except for the short term part that appears in the current

liabilities) by the amount used in the finance leasing agreement in addition to any accrued

interests till the financial position date after deducting the already paid installments, each

period interests are charged to the statement of income for the period.

m. Legal reserve :

In accordance with corporate law 159 for 1981 and the company's articles of association

5%o at least of the annual net income is required to be transferred to a legal reserve until thisreserve equals at least 50% of issued capital, This reserve is not available for dividends.

n. Finance cost :

Finance cost is registered as an expense in statement of income as incurred.

o. Treasury stocks :

Repurchased shares of the company are classified as treasury stocks and are presented as

adduction from shareholder's equity at their acquisition cost - including attributable cost,

when treasury stock are sold or reissued subsequently the amount received is recognized as

an increase in equity net of surplus or deficit on the transaction.

k.


5-

Egyptian Transport & Commercial Services Co.(Eqytrans) S.A.E

Interim consolidated Financial statementson March 31't.2011

p. Income tax :

Income tax on the profits or losses for the year, comprises current tax (calculated accordingto the laws and applicable regulations) and the deferred tax. The accrued income tax directlyrecorded in the statement of income.

The deferred tax resulting from time differences between the book values of the assets and

liabilities according to the accounting base and their value according to the expected way torealize or settle the values of assets and liabilities. Deferred tax value is recognizedaccording to the method used to verify and settle the current value of the assets and

liabilities, deferred tax is recognized as an asset of the company if there is a strongprobability that this asset could decrease the taxable profit of the company in the futureyears. The deferred tax is recognized as an asset and is reduced with its portion that will notresult in future tax benefit.

Revenue recognition :

Integrated transportation activity revenue is recognized according to accrual basis whenservices are rendered to the client, invoices are issued, it is probable that identifiable and

measurable economic benefits will flow to the companv and the cost of these benefits could

be reliably measured.

Sales revenue from goods available for sale in the free zone is recognized when allownership risks, rewards and controls are transferred to customers, the actual delivery ofsold goods, invoices were issued, it is probable that identifiable and measurable economic

benefits will flow to the company and the cost of these benefits could be reliably measured.

Expenses incurred by the company as result of clearance operations that weren't matched

by revenues are recognizedin clearance operation in process.

The credit interest is recognized according to bank's declared interest rates

Earnings per share :

Earnings per share is calculated by dividing the net profit (loss) for the period attributable toordinary shareholders of the company (reduced by board of directors' rewards and

employees share in profit) by the weighted average of the registered shares during the

financial period.

Statement of cash flows :

Statement of cash flows is prepared according to indirect method, cash and equivalents

comprise cash on hand, banks current accounts, and time deposits which have short

maturity dates from the purchase date, cash and cash equivalents at the beginning and the

end of each financial period are recognized by the amount of unrecognized profits and

losses resulted from changes in foreign currencies exchange rate.

Cash flows from banks over draft are used to finance company's operations as bank

facilities so it's changes considered financing activities.

q.

r.


6-


Interim consolidated Financial statementson March 3l't.2011

t. Impairment of assets :

The book values of company's assets reviewed at financial statements preparation date todetermine whether there is any indications of impairment in its value, if such indicationsexists the asset residual value is estimated, and the asset is recorded by its estimated residualvalue and the difference between book value and the residual value of assets are included instatement of income.

When the redemption value of the assets increase the impairment loss is redeemed in thevalue of the asset limited to it's book value which is determined after discounting theaccumulated depreciation and without discounting the impairment in the value of assets.

u. Social insurance :

The company contributes to the government social insurance system for the benefit of itspersonnel in accordance with the social insurance law no. 79 of 1975 and its amendment.Under this law, the employees and the employers contribute into the system on a fixedpercentage of salaries basis. The company's liability is confined to the amount of itscontribution. Contributions are charsed to the statement of income according to the accrualbasis.

v. Contractual agreements :

Any contractual agreements to acquire long term assets in which may result in an inflow ofeconomic resources in the future are disclosed.

w. Related partv transactions :

The related party transactions comprise the value of resources, services and obligationsamong the group and other related parties these transactions are maintained according to

same basis applied to others.All transactions and balances related to group companies are excluded as well as the

unearned profits that result from these transactions.

x. Comparative figures :

The comparative figures are reclassified whenever necessary, to conform to current yearpresentation.


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Egyptian Transport & Commercial Services Co. Interim consolidated Financial statements(Egytrans) S.A.E on March 31't.2011

Continue: fixed assets (net) :

Finance leased assets comprise the following :

- . Isotank container cleaning machine leasing agreement

A finance leasing contract dated November l9th, 2009 with the international company forleasing (lncolease) to lease an Isotank container cleaning machine, the agreement's mainarticles are as follows :

- Leased asset values US $ 728,565.- Leasing period is 66 months starting from September 30th, 2009 till }y'ray 20th,2015.- Monthly payment amounts US $ 3,830 for 6 months and US $ 14,190 forthe other

60 months.- Thelessee'srighttoacquiretheleasedassetsatthecontract'sendwithL.E 1.

- Egyptian Transport & Commercial Services Co. (Egytrans) guarantees GlobalDepot Solutions Co. in this contract

r Fork Lifts lease agreement :

A finance leasing contract dated May I't,2010 with the international company for leasing- (Incolease) to lease Fork Lifts, the agreement's main articles are as follows :

- Leased asset values US $ I 17.402.- Leasing period is 61 months starts from May 20'n,2010 till May 20'n,2015,- Monthly payments amounts US $ 618 for I month and US 52,287 for the other

60 months.- Lessee's rights to acquire the leased asset at the contract's end with L.E L- Egyptian Transport & Commercial Services Co. (Egytrans) guarantees Global

Depot Solutions Co. in this contract.

4, Proiects under construction :

Projects under construction comprise the following:3u3l20rr 3ul2l20r0

1,353,075 1,288,395

227,296 178,341

1,577 ,231 I ,577 ,2312,495,508 2,167,251

1,860,459 1,860,459

3,145,956 3,003,814

__ t942;21 __cs,UL+The company signed a contract with Kema Oracle co. to develop its computer operating system

with a total amount of L.E 5 million to acquire ERP system and OTM system, the companyaccomplished about 85% of the ERP system and didn't start in the OTM system yet.

Customs depot

Buildings instal lments

River ports projects* Computer instal lments

Land transportation proj ect

Depots solutions

Notes to consolidated financial statements

9-


lnterim consolidated Financial statementson March 31't. 2011

5. long term investments :

long term investments comprise the following :

Investments in associates :

Damietta Feeder Terminal Co. (DFTC)Barwil Egytrans Shipping Agencies Co.Scan Arabia Shipping Agencies Co.Barwil Arabia Shipping Agencies Co.

Other investments

Inventory :

Inventory balance comprises the following :

VehiclesClothes and textureSpare parts

ChemicalsOthers

Trade receivables :

Trade receivables comprise the following :

ClientsChecks under collection

Decline in clients value

3U3t20rl 3Ut2t20r0Share

percentage

20%30%30%1%

885,00013,03 1,0004,696,000

15,5 00

885,000I 1,51 1,000

3,921,00015,500

18,627,500159,177

16,332,500159,177

18,786,677 16,491,677

During 2010, Barwil Egytrans Shipping Agencies Co. increased its capital by an amount ofL.E 250,000 to be L.E I Million, this increase was registered in the commercial register.

The investment in Barwil Arabia was added to investments in associated companies as it is owned by

Barwil egytrans with an ownership percentage of 98Yo , then the holding company has significantinflunce through it's indirect ownership for more than20o/o in the invested company.

3U3t2011 3Ut2l20l013,770,836

151,587

290,03917,6004 45)

14,540,981134,908170,120

1 8,1 662,523

ll23l;l! __11,859e2t

. Developing new regulations by the administrative authorities which had a significant impacton the activities of Port Said Free Zone led to a significant decline in expected net realizable

value of goods available for sale in the company's branch at Port Said - Free Zone.

1

3t/3t2011 3Ut2t20t039,350,0823,651,850

43,001,932(2,583,5 83)

40,478,349

39,009,5883,649,444

42,659,032(2,083,583)

_19;Jj,44eo Accordingto clients balances committee, the decline in clients value on March 31't,20ll was

estimated to be L.E 2,583,583 with an increase of L.E 500,000 than last year.


10-


lnterim consolidated Financial statementson March 31",2011

8. Debtors and other debits :

Debtors and other debits comprise the following:

Due from related partiesTaxes withheld by othersSuppliers - debit balancesGeneral authority for investmentCustoms authorityAccrued revenuesPrepaid expensesL/G cash coverInsurance with othersMaritime agents - debit balancesCash imprestEmployees advancesSales tax authorityIncome tax authorityASCOAgencies claimsShipping linesLift SallabOther debits

Banks current acc. - foreign currencyBanks current acc. - local currencyTime deposits - local currencyTime deposits - foreign currencyCash on hand

3t/3t2011 3r/12/20106,639,3603,663,247

llg,gg2254,07 |

53,629546,525

3,250,651r,596,7 6l

896,909944,029458,7 75

204,58662,52655 7q5

1,016,245

1,771,229200,000

6,402,097

_23Jj5267

6,608,1844,687,105

134,485215,949

54,7 54

848,2272,158,5971,481,961

896,9091,351,585

232,66623 1,01 1

60,848

r,016,245341,418

1,771,229200,000

4,718,7 5627.009.929

9. Clearance operations in process :

Clearance operations in process comprise the following :

Alexandria branchCairo branchSuez branchPort said branchDamietta branch

3u3t20tt 3lll2l20l06,790,589(12e,s43)

1,035,41289,279

169,7 13

7 ,7 64,621(235,842)

1,232,2655 910

300,098

__l2lta:9_ _2p67,0t2-10. Cash on hand and at banks :

Cash on hand and at banks balance comprises the following :

3v3l20rl 3Ul2/2010

7,448,9822,894,212

64,000,0006,411,789

1,504

_zJj!487

3,088,7802,979,493

25,142,54347,311,184

165,427

78,687,427


l1-

Egyptian Transport & Commercial Services Co. Interim consolidated Financial statements(Egytrans) S.A.E on March 31't, 2011

11. Provisions :

Provisions balance amounting L.F,2,817,452 on March 31",201 I represents a tax provision withamount of L.E 2.6 million to meet tax differences that may happen as a result of the internalcommittee decision about tax dispute for years from 1994 to 2003 .

12. Finance leasing agreements :

Analysis of the finance leasing agreements installments according to remaining lives is as

follows:

Total contract's Paid during the Short term Long termvalue period installments installments

Financins leasing aqreements US Dollar US Dollar US Dollar US DollarIsotank container cleanins machine 728,565 103,151 135,063 490,351

The company applied the international financial reporting standard (17) instead of the Egyptianaccounting standard (20) in order to have a more accurate form of the fixed assets used in the

company's operations, balances affected by such application are as follows :

Results accordingResults to Egyptian

according to AccountingIFRS Standards Difference

Description L.E L.E L.EFixed assets-finance leased assets 5,041,964 5,041,964

Fork liftsTotal US DollarTotal L.E

DepreciationRentalvalueFinance costFinance leasing liabilities

117 ,402 16,83 I 2r.673 78,898

845,967 t19,982 156,736 569,249

5.04I.964 715.093 934,141 3,392,724

172,602 172,602294,609 294,609

7 1,365 71 ,3654,326,871 4,326,87r

3u3t20tt 3ll12/20103,295,390 2,853,151770,795 576,258

13. Trade payables :

Trade payables comprises the following :

SuppliersNotes payable


4,066,185 3,429,409

t2-


lnterim consolidated Financial statementson iVlarch 31",2011

14. Distribution creditors :

Distribution creditors balance on March 31", 2011 amounted L.E 2,742,069(L.E 2,024,694 on December 31" 2010), represented in the employees profit share.

15. Creditors and other credits :

Creditors and other credits comprise the following :

Client- credit balanceMaritime agents - credit balancesCreditors - fixed assets purchase

Accrued expensesIncome tax for the 2010Income tax for the periodTaxes withheld from othersInsurance from othersSales tax authoritySocial insurance authorityIncome tax authorityPayroll tax authorityDue to related partiesMoving capital Tax authorityKromi- HitachiAccrued compensationsAgencies claimsOther creditsShare holders's C/AContractor inssurance

3U3t20tl7 417 145

3,066,670

460,106404,559

18i,418114 11<

71,228

7,165,304

377,781128,735

1,921,848

254,8',71

7,908,437

295,943298,000

43,079

442,830319,293

680,990

3,527,062

20,478,123

3r/12t20104,893,2982,857,436

491,052478,300

211,290

51,237

1,099,211

65,462

102,935

1,179,724

i I ,1967,785,979

288,730290,000

43,0'/9

348,000

610,902133,668

16,200,839

16. Issued & subscribed capital:The authorized capital amounted L.E lBillion and total issued and paid up capital amounted

L.E 156,062,500 divided into15,606,250 shares of L.E 10 pre value each .

The extraordinary general assembly meeting at 6th of December ,2009 decided to increase

issued capital by L.E 200 million to be L.E 256,062,500 divided into 25,606,250 shares ofL.E 10 per value each, with delegating the board of directors to recall the capital increase

according to projects reschedule, the board of directors decided to call only L.E 100 millionwhich was paid in full according 1o Arab African Bank letter, this increase was registered in

the commercial register on 14''' April ,2010 leading the paid up capital to be L.E156.062"s00.


13-

Egyptian Transport & Commercial Services Co. Interim consolidated Financial statements(Egytrans) S.A.E on March 31", 2011

17. Treasury stocks :

The company repurchased treasury stockes with an amount of L.E 209,092 represented inhe value of 25,043 shares on march 2}lland recognized as reduction from equity.

18. Loans:Loans balance comprises the following :

3u3t2011 3l/12/2010Long Term Short Term Long Term Short Terminstallments installments Total installments installments Total

National bank of Egypt 10,240,783 1,600,000 I 1,840,783 11,135,637 1,600,000 12,'/35,637

NSGB 6,306,435 3,680,000 9,986,435 6,924,390 3,680,000 10,604,390

16,547,218 5,?8qp9q 2r,827,218 18,060,027 5,280,000 23,340,0ry

. There is a commercial mortgage contract with amount of L.E 3 million and U.S $ 500,000 infavor of NSGB (Misr International Bank - previously).

. There is a commercial mortgage contract with an amount of L.E 2 million and U.S $ 450,000 infavor of National Bank of Egypt.

o According to a rescheduling contract issued between the company and NSGB dated Octoberl6'n 2008, the accrued indebtedness for the NSGB in the rescheduling date amounting L.E21,546,501was rescheduled on 22 quarterly installments, the first installment dated September30th 2008 and the last will be on December 3l'n 2013, the rescheduling agreement resulted in adecrease in the accrued indebtedness by an amount of L.E 4,866,298.


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Egyptian Transport & Commercial Services Co.(Esvtrans) S.A.E

Interim consolidated Financial statementson March 3l'r.20ll

21. Earnings per share :

Earnings per share is calculated as follows:

Net profit for the period

Subtract:Employees share in profitB.O.D Bonus

Basic earnings for the shareholders

No. of shares

Earnings per share

3r/3/20rr 3t/3t2010

4,101,161 2,550,178

(2,742,069) (474,401)

1,359,092

15,606,250

2,075,777

5,606,250

0.370.09

The fair value of financial instruments :

The financial instruments of the company represent financial assets and liabilities, financial assets

include cash at banks. clients. and some debit balances while financial liabilities include bank

facilities, creditors and other credit accounts.

Risk management :

a. Credit risk :

Credit risk represents the company's ability to collect notes receivable on due dates withwhom the company deals, management observe the collection of these dues and improve itsperformance.

b. Foreign currencies risk :

Foreign currencies risk is represented in the changes of foreign exchange rates which affectpayments and collections of foreign currencies and the evaluation of assets and liabilities inforeign currencies.

c. Interest rate risk :

The company depends basically on the bank facilities to provide the working capital. Interest

rate risk represents the changes in rates ofbanks.

Subsequent events :

The Arab Republic of Egypt has experienced events that had a significant impact on all

economic sectors in general. It is very likely that this will lead to a significant decline in

economic activities during the coming periods. It is therefore possible that these events mighthave a substantial impact on the elements of assets and liabilities and related recoverable values

as well as the results of operations during the coming periods. It is currently hard to determine

the magnitude of this impact on the assets and liabilities included in the financial statement ofthe company as it depends on the expected extend and duration of these events and theirimplications.

)',

23.

24.


19-

Egyptian Transport & Commercial Services Co. Interim consolidated Financial statements(Egytrans) S.A.E on March 31"', 20ll

25. Continsent liabilities :

The banks have issued letters of guarantee for the company in favor of third party. Theoutstanding letters of guarantee as at Dec. 31", 2010 amounts L.E 12,884,205 which are coveredby an amount of L.E 1,481,961 .

26. Tax situation :

a. Egyptian Transport and Commercial Services Co. (Egytrans) (Holding company)

Corporate tax

The years from beginning of operation till 1993:The company's accounts were inspected by tax authority from the beginning of it'soperation till 1993, the company has settled and paid the accrued tax accordingto appeal

committee decision.

The years from 1994 till 2003 :

The company's accounts were inspected by tax authority for the years from 1994 till2003, the company was informed by tax forms (18) and (19), the company appealed the

form (19) and the argument is subject to the appeal committee

Year 20042The company presented it's tax return at the legal time and inspection is taking place

now for this year.

Years from 2005 till2010:The company presented its tax returns at the legal time from 2005 to 2010 according to

the Law No.91 for the year 2005.

Payroll tax:- The company has settled and paid its due tax from inception till the end of 2007.

- The company book's are under inspection for two years 2008 ,2009.

Stamp tax:The company has settled and paid it's due tax for the years from inception till 2008.

Sales tax :

- The company has settled and paid it's due tax for years from inception till 2008.

b. Esyptian Transport and Losistics Co. (ETAL)

Corporate tax

The company's accounts were inspected by tax authority for the years from 1998 till2004, these years were settled according to internal committee agreement and presented

its tax returns from2005 to 2010.


20-

Egyptian Transport & Commercial Services Co. Interim consolidated Financial statements(Egytrans) S.A.E on March 31.r,2011

Payroll tax:The company has settled and paid its due tax for the years from inception till 2003.

Sales tax :

The company has settled and paid its due tax for years from inception till 200g

c. Global Depot Solutions Co. (subsidiarv):

The company was incorporated on May 4th, 2O0g the company presented its first taxreturn for the financial period from inception till December : t

u. zo t o.

d. Esytrans For River Ports Co. (subsidiarv):

The company was incorporated on May 4th, 2009 the company presented its first taxreturn for the financial period from inception till December :t$, zoto.

e. Egytrans Barg link Co. (subsidiary):

The company was incorporated on June 4th,2009 the company presented its first taxreturn for the financial period from inception till December 3l't, 2010.

Notes to consolidated financial statements2r-

fm^zars - egytransir.egytrans.com/pdf/financial/consolidated financial... · 2011. 11. 14. · eng....

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