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Correction announcement from Wafrah for industry and Development Co. regarding the interim financial results for the period ending 31-03-2021 (Three months)

ELEMENT LIST EXPLANATION
Date of Publishing the Previous Announcement Sought to be Corrected on Tadawul’s Website 2021-05-23 Corresponding to 1442-10-11
URL of the Previous Announcement Click Here
Incorrect statements in the previous announcement Net losses after Zakat and Tax SR 198588Accumulated losses SR 14242119 18.46 %

Profit (loss) per share -0.26

The main reason for the net losses in the current quarter compared to the net profit in the equivalent quarter of the previous year is attributed to the decrease in sales by 2.25 %. Also to the increase of cost of sales and the increase in the provision for expected credit losses, and provision for valuation loss of property, plant and equipment by the sum of SR 468,578 despite the decrease in the General and Administrative expenses, and in sales and marketing expenses, and despite the increase in other revenues.

The main reason for the decrease in the losses of the current quarter compared to net losses in the previous quarter is attributed to the increase in cost of sales in the previous quarter. It also has to be mentioned that the results of last quarter included provisions that are usually made at the end of the year, which included provision for expected credit losses by SR 1,326,059 and provision for impairment in inventory value and slow moving goods by the sum of SR 2,032,961, in addition to provision for possible Zakat differences for the years from 2014 to 2018 to the sum of SR 2,728,946.

Material Uncertainty Related to Going Concern:

We draw attention to note (2-d) to the financial statements, which indicates that the company incurred a loss of approximately SAR March 20-21 in In addition to the Company’s current liabilities as on March 31, 2020 exceeding its current assets by SAR 12,470,986. These conditions or events indicate that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Our opinion is not modified in respect of these matters.

Correct Statement Net profits after Zakat and Tax SR 269990Accumulated losses SR 13973541 18.11 %

Profit (loss) per share 0.03

The main reason for the decrease in net profit in the current quarter compared to the equivalent quarter of the previous year is attributed to the decrease in sales by 2.25 %. Also to the increase of cost of sales and the increase in the provision for expected credit losses despite the decrease in the General and Administrative expenses, and in sales and marketing expenses, and despite the increase in other revenues.

Gaining net profit in the current quarter compared to net losses in the previous quarter is attributed to the increase in cost of sales in the previous quarter. It also has to be mentioned that the results of last quarter included provisions that are usually made at the end of the year, which included provision for expected credit losses by SR 1,326,059 and provision for impairment in inventory value and slow moving goods by the sum of SR 2,032,961, in addition to provision for possible Zakat differences for the years from 2014 to 2018 to the sum of SR 2,728,946

Emphasis of matter

We draw attention to note (2-e) to the accompanying condensed interim financial statements, which indicates that the current liabilities of the exceeded its current assets amounting to SAR 12,470,986 as at 31 March 2021. These conditions or events to indicate that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Our opinion is not modified in respect of these matters.