Balance Sheet     Profit & Loss     Cash Flow     Change in Equity     Notes to The Accounts

EXIDE PAKISTAN LIMITED NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED) FOR THE HALF YEAR ENDED SEPTEMBER 30, 2005   1 . STATUS AND NATURE OF BUSINESS The company is a limited liability company and is incorporated in Pakistan. The address of its registered office is 40-K, Block 6, Dr. Mahmood Hussain Road, Karachi, Pakistan. The company is engaged in the manufacture and sale of automotive batteries, industrial cells, chemicals and acid and is listed on the Karachi and Lahore Stock Exchanges.   2 . SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 2 .1 . STATUS AND NATURE OF BUSINESS These financial statements have been prepared in accordance with the approved accounting standards as applicable in Pakistan and the requirements of the Companies Ordinance, 1984. Approved accounting standards comprise of such International Accounting Standards (IASs) as notified under the provisions of the Companies Ordinance, 1984. Wherever the requirements of the Companies Ordinance, 1984 or directives issued by the Securities and Exchange Commission of Pakistan differ with the requirements of these standards, the requirements of the Companies Ordinance, 1984 or the requirements of the said directives take precedence. The disclosures made in these financial statements have, however, been limited based on the requirements of the International Accounting Standard 34, Interim Financial Reporting. These financial statements are unaudited but have been reviewed by the external auditors of the company.   2 .2 . Accounting convention These financial statements have been prepared under the historical cost convention, except that certain fixed assets have been included at revalued amounts.   2 . 3 . Accounting policies The accounting policies adopted in preparation of these financial statements are the same as those applied in the preparation of the preceding annual published financial statements of the Company for the year ended March 31, 2005.

3 . FIXED ASSETS - PROPERTY, PLANT AND EQUIPMENT The cost of additions and deletions to operating fixed assets during the period were as follows:       Additions Deletions     _____________Ruppes '000_______________   Plant and machinery   1,471 - Plant and machinery   204 - Vehicles   55 1,863 Office equipment   477 -     4 . COMMITMENTS Commitments for rentals under operating lease agreements as at September 30, 2005 amounted to Rs. 4.483 million payable as follows:         Rupees' 000   Six months ending March 31, 2006     1,094 Year ending March 31, 2007     1,884 Year ending March 31, 2008     1,283 Year ending March 31, 2009     222       __________ 4,483 __________       For the six months ended September 30, 2005 For the six months ended September 30, 2004 2005     ______________Ruppes '000_______________   5 . COST OF SALES   Raw and packing materials and components consumed   514,532 418,181   Salaries, wages and benefits Fuel, power and water Insurance Conveyance and transportation Lease rentals Depreciation Repairs and maintenance Others   26,989 20,526 1,458 1,405 601 12,346 11,988 10,651 26,613 22,577 1,426 1,886 587 9,854 13,558 15,537     85,964 92,038 Opening stock of work-in-process   31,280 25,562 Closing stock of work-in-process   (40,580) __________ (37,168) __________ Cost of goods manufactured   591,196 498,613 Opening stock of finished goods   53,804 46,936 Finished goods purchased   18,715 21,145 Closing stock of finished goods   (85,576) (78,401)     __________ 578,139 __________ __________ 488,293 __________       6 . CASH GENERATED FROM OPERATIONS   Profit before taxation       Adjustment for non-cash charges and other items   Depreciation   Gain on disposal of fixed assets   Provision for gratuity   Provision for doubtful debts   Provision for slow moving and obsolete spares   Mark up on running finance   Working capital changes Cash generated from operations 30,632 14,104 (602) 300 - - 14,109 2,288 60,831 42,498 11,289 (332) 300 300 300 5,819 (80,220) (20,046)   _____________Ruppes '000_______________   (Increase)/decrease in current assets Spares Spares Stock-in-trade Trade debts Loans and advances Short-term prepayments, deposits and other receivables Increase/(decrease) in current liabilities Creditors, accrued and other liabilities (excluding unclaimed dividends and provision for gratuity)   340 (12,891) (210) (3,490) (1,077)       19,616 2,288 (571) (40,165) (44,032) (367) (7,843) 12,758 (80,220)     7 . CASH AND CASH EQUIVALENTS Cash and cash equivalents included in the cash flow statement comprise of the following balance sheet amounts:       September 30, 2005 September 30, 2004   _____________Ruppes '000_______________   Cash and bank balances Short term running finances   41,500 (57,394) (15,894) 20,991 (89,999) (69,008)       8 . TRANSACTIONS WITH RELATED PARTIES The company has related party relationship with its associated undertakings, subsidiary companies, employee benefit plans and its directors and executive officers (including their associates). Transactions with related parties essentially entail investments made in subsidiary companies, sale and purchase of goods and services and expenses charged between these companies. The significant transactions with related parties carried out during the half year ended September 30, 2005 are as follows:     _____________2005___________ 2004   Subsidiary companies Other related parties Key Mmanagement personnel   _____________Ruppes '000_______________   Sale of goods Purchase of goods and services Expenses charged to associated undertakings Expenses charged by associated undertakings Payments made to retirement benefit plans Interest charged on loan from director Salaries and other short term employee benefits Post employment benefits 3,137    177    683      29       -       -       -       -       -       -       -       - 3,326       -       -       -       -       -       -       -       -   350 1,857   166 3,066   12,793   538     27      4,125      350      1,744      178   9 .CORRESPONDING FIGURES Corresponding figures have been rearranged or reclassified whereever necessary for the purpose of comparison.     10 . DATE OF AUTHORISATION FOR ISSUE These financial statements were authorised for issue by the Board of Directors of the Company on 28 November, 2005.     ARIF HASHWANI Chairman S.I. AHMED Chief Executive     © 2000 -2001 EXIDE PAKISTAN LIMITED, All Rights Reserved.