Lecico Egypt (S.A.

E)
P.O Box 358
Alexandria, Egypt
Tel.: +203 5180011
Fax: +203 5180029
[Link]

Mr. / Head of Disclosure Sector in the Egyptian Stock Exchange

After Greetings,

Referring to the separate financial results of Lecico Egypt S.A.E. for the
financial period ended June 2025, the company reported a net profit of LE
78,052,064 compared to a net profit in the same period last year of LE
504,597,228. The reasons for the profit decrease in the financial period
ended June 2025 are detailed as follows:

1- Gross profit decreased by LE 17 million compared to the same

period of the previous year.

2- Increase in the percentage of selling expenses compared to the same

period of the previous year by 1.36%.

3- Lecico Egypt's standalone income statement includes exceptional

gains in the first quarter of 2024, amounting to EGP 277 million in
foreign exchange gains and EGP 150 million in gains from
offloading some of its excess foreign currency through the GDR.

Best Regards,

Lecico Egypt
Mohamed Aly Mohamed Hassan
Finance Director
Investor Relations Officer
 LECICO EGYPT (S.A.E.)
Separate Interim Financial Statements
for the Financial Period Ended
30 June 2025 and Independent Auditor’s Report on
Review of Separate Interim Financial Statements
 LECICO EGYPT (S.A.E.)
Separate Interim Financial Statements
for the Financial Period Ended
30 June 2025 and Independent Auditor’s Report on
Review of Separate Interim Financial Statements

Contents Page

Independent Auditor’s Report on Review of Separate Interim Financial Statements --

Separate Statement of Financial Position 1

Separate Statement of Profit or Loss 2

Separate Statement of Comprehensive Income 3

Separate Statement of Changes in Equity 4

Separate Statement of Cash Flows 5

Accounting policies and notes to Separate interim Financial Statements 6-57

 LECICO EGYPT (S.A.E.)
Separate Statement of Profit or Loss for the financial Period Ended

From 1 April 2025 From 1 January 2025 From 1 April 2024 From 1 January 2024
Note To 30 June 2025 To 30 June 2025 To 30 June 2024 To 30 June 2024
No. EGP EGP EGP EGP
Sales (3) 860,858,224 1,617,134,526 602,858,390 1,212,561,509
Cost of sales (4) (696,314,674) (1,316,610,837) (459,306,514) (894,820,839)
Gross profit 164,543,550 300,523,689 143,551,876 317,740,670

Other income (5) 11,768,873 27,943,569 26,069,318 36,234,840

Selling and distribution expenses (6) (19,383,554) (36,048,168) (5,992,306) (10,500,212)
Administrative and general expenses (7) (42,146,132) (79,631,689) (28,946,265) (57,735,566)
Expected credit loss (8) (9,375,883) (15,375,883) (1,810,484) (9,549,986)
Other expenses (9) (11,546,757) (37,907,192) (9,224,111) (11,940,711)
Profit resultsing from operating activities 93,860,097 159,504,326 123,648,028 264,249,035

Finance income (10-2) 5,968,748 12,487,405 7,176,687 277,320,646

Finance expenses (10-1) (40,666,745) (66,714,026) (34,974,628) (69,556,257)
Income from investments (11) 13,970,000 13,970,000 6,985,000 156,498,067
Profit before income tax 73,132,100 119,247,705 102,835,087 628,511,491
Income tax expense (16-1) (19,491,175) (41,195,641) (21,056,869) (123,914,263)
Net profit for the period 53,640,925 78,052,064 81,778,218 504,597,228
Basic and diluted earnings per share (12) 0.60 0.84 0.97 6.20

The notes from no. (1) to no (35) are an integral part of these separate interim financial statements to be
read together.

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LECICO EGYPT (S.A.E.)
Separate statement of Comprehensive Income for the financial Period Ended

Note From 1 April 2025 From 1 January 2025 From 1 April 2024 From 1 January 2024
To 30 June 2025 To 30 June 2025 To 30 June 2024 To 30 June 2024
EGP EGP EGP EGP
Net profit for the period 53,640,925 78,052,064 81,778,218 504,597,228
Other comprehensive income items - - - -
Total comprehensive income for the period
53,640,925 78,052,064 81,778,218 504,597,228

The notes from no. (1) to no (35) are an integral part of these separate interim financial statements to be
read together.

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LECICO EGYPT (S.A.E.)
Separate Statement of Changes in Equity for the financial Period Ended 30 June 2025
Paid up and Treasury (Accumulated
Note Issued Shares Reserves losses) / Retaind Total
No. Capital earnings
Description EGP EGP EGP EGP EGP

Balance as at January 1, 2024 400,000,000 (25,388,998) 281,331,724 (12,283,395) 643,659,331

Transactions with Company’s shareholders
Distributing of treasury shares (27) - 25,388,998 - (25,388,998) -
Total Transactions with Company’s shareholders - 25,388,998 - (25,388,998) -
Comprehensive Income
Net profit for the period - - - 504,597,228 504,597,228
Total Comprehensive Income - - - 504,597,228 504,597,228
Balance as at June 30, 2024 400,000,000 - 281,331,724 466,924,835 1,148,256,559

Balance as at January 1, 2025 400,000,000 - 281,331,724 392,226,334 1,073,558,058

Transactions with Company's shareholders
Transferred to legal reserve (26-3) - - 21,494,936 (21,494,936) -
Dividends - - - (25,729,135) (25,729,135)
Total Transactions with Company's shareholders - - 21,494,936 (47,224,071) (25,729,135)
Comprehensive Income
Net profit for the period - - - 78,052,064 78,052,064
Total Comprehensive Income - - - 78,052,064 78,052,064
Balance as at June 30, 2025 400,000,000 - 302,826,660 423,054,327 1,125,880,987
The notes from no. (1) to no. (35) are an integral part of these separate interim financial statements to be read together.

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 LECICO EGYPT (S.A.E.)
Separate interim Statements of Cash Flows for the financial Period Ended
Note June 30, 2025 June 30, 2024
No. EGP EGP
Cash flows from operating activities
Net profit for the period before tax 119,247,705 628,511,491
Adjustments
Property, plant & equipment depreciation and intangible assets amortization (13-1)،(13-2) 38,512,053 28,333,868
unrecognized net Foreign currencies exchange differences (10,934,422) (279,787,826)
Investments revenues (11) (13,970,000) (6,985,000)
(Interest) income (10) (1,257,114) (321,108)
Income from investments at fair value through profit or loss (10) - (149,513,067)
(Interest) expense (10) 66,714,026 69,556,257
198,312,248 289,794,615
Change in inventories (17) (114,254,756) (100,663,249)
Change in trade, notes, other receivables and Due from related parties (18)،(30-1) (206,684,424) 11,403,349
Change in trade,notes, other payables and Due to related parties (21)،(30-2) (109,367,465) (109,680,031)
Employees dividends Paid (20,978,041) -
Change in provisions (22) (8,295,921) (3,394,869)
(261,268,359) 87,459,815
Interest of credit facilities paid (20) (64,619,266) (70,803,447)
Income tax paid (114,102,952) (61,500,320)
Net cash flows (used in) operating activities (439,990,577) (44,843,952)
Cash flows from investing activities
Payments for acquisition of Property, plant & equipment and projects under
(13)،(14) (34,691,982) (47,886,181)
construction
Credit interest received (10) 1,257,114 321,108
Dividends received from investments in subsidiaries - 6,286,500
Net cash (used in) investing activities (33,434,868) (41,278,573)
Cash flows from financing activities
Payments for loans installments (20) - (9,267,000)
Net received / (paid) from Banks credit facilities (20) 459,238,664 (205,363,707)
Payments for acqusition financial securities - (156,483,911)
Proceeds from sale of financial securities - 305,996,979
Net cash provided from / (used in ) financing activities 459,238,664 (65,117,639)
Net changes in cash and cash equivalents (14,186,781) (151,240,164)
The effect of foreign currencies exchange rate on cash & cash equivalents 19,114,044 177,428,533
Cash and cash equivalent, at the beginning of the period (19) 225,064,456 357,894,020
Cash and cash equivalent, at the end of the period (19) 229,991,719 384,082,389

-The notes from no. (1) to no. (35) are an integral part of these separate interim financial statements to
be read together.
- the disclosures related to separate cash flows statement notes no. (23).
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LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

1. Background and activities

Legal entity

- Lecico Egypt (S.A.E.) ”the company” was established on November 1 st, 1975 according to the
resolution of the Ministry of Economics and Economic Co-operation number 142 of 1975. The
company is subject to law number 72 of 2017 which superseded law No. 8 of 1997.
- The Company's duration is 75 year starting from the date of registration in the Commercial
registry on November 10, 1975 till 9 November 2050 .
- The registered office of the Company is in the Khorshid district in Alexandria, Egypt.
- The company is listed on the Egyptian stock exchange.
- Mr. Gilbert Gargour is the Company’s Chairman, and Mr. Taher Gilbert Gargour is the Managing
Director.
- The company's fiscal year begins on the first of January and ends on the 31st of December of
each year.
- The main Shareholders of the company is Intage Holding Limited.

Company purpose
- Manufacture and production of all ceramic industries, including the manufacture and production
of sanitary ware, all types of tiles and manufacture of porcelain and manufacturing for other.

- The company may have an interest or participate in any way with the authorities that carry out
business similar to its business or that may cooperate with it to achieve its purpose in Egypt or
abroad, and it may also merge with the previous authorities, buy them or join them, in accordance
with law and its executive regulations.

2. The basis for preparing the interim separate financial statements.

a. Compliance with accounting standards and laws

- The separate interim financial statements have been prepared in accordance with the Egyptian
accounting standards and the relevant Egyptian laws and regulations.

-Egyptian accounting standards require referring to international financial standards for events
and transactions that are not covered by an issued accounting standard or legal requirements that
clarify how to treat them.

- The Company's standalone interim financial statements were approved by the Board of Directors
on August 14, 2025.
- Details of the Company’s Material accounting policies are included in Note (32).
b. Functional and presentation currency
-The separate interim financial statements are presented in Egyptian Pounds (EGP) which is the
company’s functional currency.

c. Basis of measurement
The financial statements have been prepared on historical cost basis except for the following:
- Financial assets and liabilities recognized at fair value through profits or losses.
- Financial assets and liabilities recognized at fair value through other comprehensive income.
- Financial assets and liabilities recognised at amortized cost.
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 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

d. Use of Estimates and Judgments

In preparing the separate interim financial statements in accordance with Egyptian Accounting
Standards (EAS), management has made judgments, estimates and assumptions that affect the
application of the Company’s accounting policies and the reported amounts of assets, liabilities,
income and expenses and the accompanying disclosures, and the disclosure of contingent liabilities.
These estimates and assumptions are based on experience and various factors. Actual results may
differ from these estimates and the uncertainty about these assumptions and estimates could result in
outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in
future years.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the period in which the estimate is revised if the revision
affects only that period or in the period of the revision and future periods if the revision affects both
current and future years.

e. Judgments
Information about judgements made in applying accounting policies that have the most significant effects on the
amounts recognized in the separate financial statements is included in the following notes:
- Revenue recognition
Revenue is recognized as detailed in the accounting policies applied.
- Equity-accounted investees and associates Companies:
Determining whether the Company has significant influence over Companies and investees.
- Lease contracts classification.
In the process of classifying properties, management has made various judgements. Judgement is needed to
determine whether a property qualifies as an investment property, property, plant and equipment and/or property
held for sale. The Company develops criteria in order to exercise that judgement consistently in accordance with
the definitions of investment property, property, plant and equipment and property held for sale. In making its
judgement, management considered the detailed criteria and related guidance for the classification of properties
as set out in EAS 2, EAS 49, and EAS 10, and the intended usage of property as determined by management.
Incremental Borrowing Rates (IBRs) applied in right of use calculation.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing
rate as the discount rate. The Company determines its incremental borrowing rate by obtaining interest rates from
various external financing sources and makes certain adjustments to reflect the terms of the lease and type of
asset leased.

The company cannot easily determine the implicit interest rate in the lease contract, and therefore it uses the
incremental borrowing rate to measure the lease liabilities. The incremental borrowing rate is the interest rate that
the company must pay in order to borrow the necessary financing over a similar term and with a similar guarantee
to obtain an asset of the same value as the “right of use” asset in a similar economic environment. Therefore, the
incremental borrowing rate reflects what the company has to pay, which requires an estimate when published
rates are not available or when they need to be adjusted to reflect the terms and conditions of the lease.

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 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

- Recognition of current and deferred tax assets and liabilities and their measurement
Income taxes, whether current or deferred, are determined the Company in accordance with the tax law
requirements.
The Company's profit is subject to income tax, which requires the use of significant estimates to determine the
total income tax liability. As determining the final tax liability for some transactions could be difficult during the
year, the Company record current tax liability according to its' best estimate about the taxable treatment of that
transactions and the possibility of incurring of additional tax charges that may result from the tax inspection. And
when a difference arises between the final tax liability and what is being recorded, such difference is recorded as
income tax expense and current tax liability in the current period and to be considered as change in accounting
estimates.
For recognition of deferred tax assets, management uses assumptions about the availability of sufficient taxable
profits allowing use of recognized tax assets in the future. Management also uses assumptions related to
determination of the applicable tax rate at the financial statements date at which deferred tax assets and liabilities
are expected to be settled in the future.
This process requires the use of multiple and complex estimates in estimating and determining the taxable pool
and temporary deductible taxable differences resulting from the difference between the accounting basis and the
tax basis for some assets and liabilities. In addition to estimating the extent to use deferred tax assets arising from
carry forward tax losses, in the light of making estimates of future taxable profits and future plans for each of the
activities.

f. Assumptions and estimation uncertainties

The key assumptions concerning the future, and other key sources of estimation uncertainty at the reporting date,
that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial period, are discussed below. The Company bases its assumptions and estimates on
parameters available when the separate financial statements were prepared. Existing circumstances and
assumptions about future developments, however, may change due to market changes or circumstances arising
that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

- Measurement of expected credit loss

The Company assesses the impairment of its financial assets based on the expected credit loss (“ECL”) model.
Under the ECL model, the Company accounts for expected credit losses and changes in those expected credit
losses at the end of each reporting period to reflect changes in credit risk since initial recognition of the financial
assets. The Company measures the loss allowance at an amount equal to the lifetime ECL for its financial
instruments. When measuring ECL, the Company uses reasonable and supportable forward-looking information,
which is based on assumptions for the future movement of different economic drivers and how these drivers will
affect each other. Loss given default is an estimate of the loss arising on default. It is based on the difference
between the contractual cash flows due and those that the lender would expect to receive, considering cash flows
from collateral and integral credit enhancements. Probability of default constitutes a key input in measuring ECL.
Probability of default is an estimate of the likelihood of default over a given time horizon, the calculation of
which includes historical data, assumptions, and expectations of future conditions.

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LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

Impairment of non-financial assets

On the date of preparing the separate financial statements, the company evaluates the asset if there is
an indication that the asset is impaired. If there is an indication of that, the company evaluates the
recoverable amount of the asset. The recoverable amount of the asset is the fair value of the asset less
selling costs or its value in use. Whichever is higher, when assessing the value in use, the estimated
future cash flows of the asset are discounted to their present value using a discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.

When determining the fair value less costs to sell, recent market transactions are taken into account.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the separate
carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognized
directly in the profit or loss statement.

Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, but only to the extent that the carrying amount does not
exceed the carrying amount that would have been determined had no impairment loss existed for the
carriage amount of asset in prior periods, A reversal of an impairment loss is recognized immediately
in the standalone statement of profit or loss.

The useful life of fixed assets and intangible assets

The company's management determines the estimated useful life of fixed assets and intangible assets
for the purpose of calculating depreciation and amortization, this estimate is made after taking into
account the expected use of the asset or actual obsolescence, the management periodically reviews
the useful lives on an annual basis, at least, and the depreciation method to ensure that the method
and periods of depreciation are consistent with the expected pattern of economic benefits of the
assets.
Impairment of property, plant and equipment and projects under construction
Properties classified under property, plant and equipment and projects under construction are
assessed for impairment when there is an indication that those assets have suffered an impairment
loss. An impairment review is carried out to determine the recoverable amount which considers the
fair value of the property under consideration.
Estimation of net realizable value for inventory
Inventory is stated at the lower of cost or net realizable value (“NRV”). NRV is assessed with
reference to sales prices at the end of the reporting period. NRV is determined by the Company
having taken suitable external advice and in the light of recent market transactions, where available.

Provisions and contingent liabilities

Management assess events and circumstances that might led to a commitment on the Company's side
from performing its normal economic activities, management uses in this primary estimates and
assumptions to judge the extend on which the provision's recognition conditions have been met at the
financial statement date, and analyze information to assume whether past events lead to current liability
against the Company and estimate the future cash outflows and timing to settle this obligation, in
addition, selecting the method which enable the management to measure the value of the commitment
reliably.

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LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

g. Fair value measurement

A certain number of the Company’s accounting policies and disclosures require measurement of
fair values, for both financial and non-financial assets and liabilities.
Accreditation is measured in the fair value of assets and liabilities mainly on available market data,
and the data that is relied upon in the evaluation is classified according to the following hierarchy:

 Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
 Level 2: inputs of the quoted prices included in level (1) that are observable for the asset or
liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
 Level 3: inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
- The Company recognizes transfers between levels of the fair value hierarchy at the end
of the financial year during which the change has occurred.
- Further information about the assumptions made in measuring fair values is included in
the following notes:

 Investment with fair value through profit or loss.

 Financial instruments (Note No. 25)

h. The consolidated financial statements

- The Company has subsidiaries and according to the Egyptian Accounting Standards No. (42) "consolidated
financial statements" and Article 188 of the executive regulations for Companies’ law No. 159 of 1981, the
Company is preparing consolidated financial statements for the Group which should be used as a reference to
understand the financial position, financial performance and cash flows for the group as a whole.

- 10 -
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

3. Sales
From 1 April 2025 From 1 January 2025 From 1 April 2024 From 1 January 2024
Revenue recognized at apiont of time Note To 30 June 2025 To 30 June 2025 To 30 June 2024 To 30 June 2024
No. EGP EGP EGP EGP
Local sales 330,120,966 672,231,414 259,037,597 563,947,635
Export sales 530,737,258 944,903,112 343,820,793 648,613,874
860,858,224 1,617,134,526 602,858,390 1,212,561,509

4. Cost of Sales
Raw materials & Consumables 461,125,614 879,770,069 292,003,517 538,685,235
Salaries & Wages 77,072,957 157,439,324 60,377,318 120,815,610
Energy expense 111,668,300 221,667,800 88,547,323 170,044,882
Depreciation (13) 18,369,343 36,743,645 13,667,681 26,999,944
Change in finished & in progress products (17) (27,608,496) (91,463,033) (43,053,034) (52,774,897)
Impairment of inventory (17) - - - 1,910,118
Freight, Levy and Clearing Fees 27,804,244 57,496,047 27,880,264 51,351,072
Other 27,882,713 54,956,985 19,883,445 37,788,875
696,314,674 1,316,610,837 459,306,514 894,820,839

5. Other income

Reversal of expired provision (22) - 22,000,000 10,784,000 -

Discounting of notes payable & receivable to its present value 8,584,448 - 9,349,363 29,187,319
Scrap and other revenues 3,184,425 5,943,569 255,082 1,366,648
Export subsidies revenues - - 5,680,873 5,680,873
11,768,873 27,943,569 26,069,318 36,234,840

6. Selling and distribution expenses

Exhibitions expenses 4,301,686 8,446,053 4,595,315 8,433,068
Advertising Expenses 100,320 100,320 79,800 85,500
Marketing and distributing services (30-2) 14,860,644 26,457,288 - -
Other 120,904 1,044,507 1,317,191 1,981,644
19,383,554 36,048,168 5,992,306 10,500,212

- 11 -
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

From 1 April 2025 From 1 January 2025 From 1 April 2024 From 1 January 2024
7. General and Administrative expenses Note To 30 June 2025 To 30 June 2025 To 30 June 2024 To 30 June 2024
No. EGP EGP EGP EGP

Administrative Salaries 15,482,169 30,830,554 12,312,949 23,728,460

Vehicles & transportation expenses 5,052,143 9,683,243 2,588,756 5,815,087
Telephone and Post expenses 851,498 2,064,169 1,226,023 2,475,832
Professional and cosultation Fees 7,192,365 12,599,081 5,353,245 9,633,064
Computer , networking and maintenance expenses 4,134,814 6,697,044 948,815 2,426,900
Taxes, Fees and Symbiotic contribution 5,334,223 9,584,787 3,154,911 7,593,658
Admin Depreciation (13) 802,972 1,564,306 592,602 1,129,822
Amortization of intangible assets (13-1) 102,051 204,102 102,051 204,102
Other 3,193,897 6,404,403 2,666,913 4,728,641
42,146,132 79,631,689 28,946,265 57,735,566
8. Expexted credit loss

Expected credit loss on receivables (18) 9,375,883 15,375,883 1,810,484 9,549,986

9,375,883 15,375,883 1,810,484 9,549,986
9. Other expenses

Formed provision for claims (22) 8,215,000 15,845,000 - 2,701,600

Board of directors allowances (30-3) 15,000 30,000 15,000 30,000
Discounting of long term notes payables to its present value - 18,456,264 - -
Other expenses 3,316,757 3,575,928 9,209,111 9,209,111
11,546,757 37,907,192 9,224,111 11,940,711

10. finance costs / finance income

10.1 Finance costs

Interest expense- Credit facilities 40,666,745 66,714,026 34,974,628 69,058,179

Interest expense- Loan - - - 498,078
40,666,745 66,714,026 34,974,628 69,556,257

10.2 Finance income

Interest income 1,118,779 1,257,114 321,108 321,108
Net foreign currency exchange Differences 4,849,969 11,230,291 6,855,579 276,999,538
5,968,748 12,487,405 7,176,687 277,320,646

- 12 -
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

11. Income from investments

From 1 April 2025 From 1 January 2025 From 1 April 2024 From 1 January 2024
To 30 June 2025 To 30 June 2025 To 30 June 2024 To 30 June 2024
EGP EGP EGP EGP
Income from investment fair value through profit or loss - - - 149,513,067
Income from dividends - Burg Armaturen Fabrik-Subsidiary 13,970,000 13,970,000 6,985,000 6,985,000

* Represents net income from investments in securities on the Egyptian Stock Exchange.

12. Basic and diluited earnings per share according to profit or loss statement

The calculation of basic and diluited earnings per share is as follows:

From 1 April 2025 From 1 January 2025 From 1 April 2024 From 1 January 2024
To 30 June 2025 To 30 June 2025 To 30 June 2024 To 30 June 2024
EGP EGP EGP EGP

Net profit for the period (EGP) 53,640,925 78,052,064 81,778,218 504,597,228
Less :
Employees’ Dividends (estimated EGP) (5,244,510) (10,634,326) (4,248,954) (8,375,272)
48,396,415 67,417,738 77,529,264 496,221,956
. Number of shares (weighted average) 80,000,000 80,000,000 80,000,000 80,000,000
Basic and diluited earning per share ( EGP / share) 0.60 0.84 0.97 6.20

- 13 -
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

13. Property, plant and equipment (Net).

13.1 Plant, property and equipment
De scription Land * Buildings & Machinery & Vehicles Tools Furniture & Compute rs Total
In Egyptian Pound constructions Equipment Office Equipment
EGP EGP EGP EGP EGP EGP EGP EGP
Cost
As of 01/01/2025 112,743,016 140,960,553 667,352,041 37,136,368 112,839,905 15,171,647 16,291,498 1,102,495,028
Additions for the period - - 1,159,826 - 503,168 1,410,236 6,095,695 9,168,925
Disposals for the period
- - - (254,000) - - - (254,000)
As of 30/06/2025 112,743,016 140,960,553 668,511,867 36,882,368 113,343,073 16,581,883 22,387,193 1,111,409,953

Accumulate d depreciation
As of 01/01/2025 - 88,050,618 513,090,520 26,372,865 107,933,391 10,151,072 12,936,909 758,535,375
Depreciation charge for the period - 2,487,074 32,013,903 1,337,298 1,004,916 366,238 1,098,522 38,307,951
Accumulated depreciation for disposals - - - (254,000) - - - (254,000)
As of 30/06/2025 - 90,537,692 545,104,423 27,456,163 108,938,307 10,517,310 14,035,431 796,589,326
Carrying amounts
As of 30/06/2025 112,743,016 50,422,861 123,407,444 9,426,205 4,404,766 6,064,573 8,351,762 314,820,627
As of 31/12/2024 112,743,016 52,909,935 154,261,521 10,763,503 4,906,514 5,020,575 3,354,589 343,959,653
Fully depreciated Plant, prope rty - 32,353,629 411,129,356 23,509,531 102,793,523 8,885,865 10,555,429 589,227,333
and equipment and s till ope rating

- Depreciation expenses were allocated as follow:

Note 30 June 2025 30 June 2024
No.
Cost of sales (4) 36,743,645 26,999,944
Administrative and general expenses (7) 1,564,306 1,129,822
38,307,951 28,129,766

- 14 -
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

Continued Property, plant and equipment (Net)

Land Buildings & Machinery & Vehicles Tools Furniture & Computers Total
constructions Equipment Office & Software
Equipment
EGP EGP EGP EGP EGP EGP EGP EGP
Cost
As of 01/01/2024 135,810,080 117,893,489 612,085,039 27,708,024 111,255,745 11,970,450 21,358,585 1,038,081,412
Additions for the period - - 26,710 4,926,110 640,095 702,780 1,683,395 7,979,090
reclass for the period - -
(23,067,064) 23,067,064 - - - -
As of 30/06/2024 112,743,016 140,960,553 612,111,749 32,634,134 111,895,840 12,673,230 23,041,980 1,046,060,502
Less :
Accumulated depreciation
As of 01/01/2024 - 83,147,761 497,358,230 24,851,661 105,395,534 9,748,518 17,187,586 737,689,290
Depreciation charge for the period - 2,360,283 23,227,223 550,324 1,323,381 163,067 709,590 28,333,868
As of 30/06/2024 - 85,508,044 520,585,453 25,401,985 106,718,915 9,911,585 17,897,176 766,023,158
Carrying amounts
As of 30/06/2024 112,743,016 55,452,509 91,526,296 7,232,149 5,176,925 2,761,645 5,144,804 280,037,344
As of 31/12/2023 135,810,080 34,745,728 114,726,809 2,856,363 5,860,211 2,221,932 4,170,999 300,392,122
Fully depreciated Plant, property and - 30,545,269 408,442,295 23,872,068 99,418,786 8,760,882 16,018,457 587,057,757
equipment and still operating

- 15 -
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

* The balance of the land is represented in the following:

Note 30/06/2025 31/12/2024
No. EGP EGP
Khorshid Land in Alexandria 45,096,000 45,096,000
Maadi Land 1,311,000 1,311,000
El Awaid Land 8,628,751 8,628,751
Lebanon Land 57,707,265 57,707,265
112,743,016 112,743,016

- Property, plant and equipment include land and buildings that are purchased with preliminary
contracts and unregistered in the company’s name as follows:

In Egyptian Pound 30/06/2025 31/12/2024

Land 10,959,606 10,959,606

Buildings 6,513,000 6,513,000
17,472,606 17,472,606

13.2 Intangible Assets :

- Intangible assets represent in amount of computer programes .

Note 30/06/2025 31/12/2024

No.
Cost
At the beginning of the period / year 6,878,231 6,878,231
At the End of the period / year 6,878,231 6,878,231
Less :
Accumulated amortization
At the beginning of the period / year 5,738,810 5,330,606
Amortization charge for the period / year (7) 204,102 408,204
At the End of the period / year 5,942,912 5,738,810
Carrying amounts 935,319 1,139,421

16
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

14. Projects under construction

In Egyptian Pound 30/06/2025 31/12/2024
EGP EGP
Machinery, equipment,building under installation and other 30,488,700 -
Advances for acquiring fixed assets * - 4,965,642
30,488,700 4,965,642

* The advance payments represent payments for gas network improvements.

The following is the movement of projects under implementation during the period / year :-

In Egyptian Pound 30/06/2025 31/12/2024

EGP EGP
Balance at the beginning of the period /year 4,965,642 13,609,544
Additions for the period /year 26,183,058 75,942,163
Transfer to Property, plant & equipment for the period /year (660,000) (84,586,065)
Balance at the end of the period /year 30,488,700 4,965,642

17
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

15. Investment in subsidiaries & Other investment

Total Impairment Impairment Net
Investments on investments on investments investments
In Egyptian Pound Country Ownership 30/06/2025 01/01/2025 30/06/2025 30/06/2025 31/12/2024
% EGP EGP EGP EGP EGP

Investments in subsidiaries not listed on the stock exchange

Lecico for Ceramic Industries Egypt 99.99 141,771,731 (15,474,579) (15,474,579) 126,297,152 126,297,152
T.G.F for Consulting & Trading Egypt 99.83 5,990,000 (2,743,492) (2,743,492) 3,246,508 3,246,508
Lecico for Financial Investments Egypt 99.33 2,980,000 - - 2,980,000 2,980,000
Lebanese Ceramic Industries Co Lebanon 94.77 71,269,000 - - 71,269,000 71,269,000
International Ceramic Egypt 99.97 59,995,000 - - 59,995,000 59,995,000
Lecico for Trading & Distribution Ceramics Egypt 70.00 8,400,000 (8,400,000) (8,400,000) - -
European Ceramics Egypt 99.97 49,985,000 - - 49,985,000 49,985,000
Sarreguemines Egypt 99.85 9,985,000 (4,615,914) (4,615,914) 5,369,086 5,369,086
Burg Armaturen Fabrik - Sarrdesign Egypt 69.85 6,985,000 - - 6,985,000 6,985,000
Lecico (UK) Ltd UK 100 303,103,607 - - 303,103,607 303,103,607
Total investments in subsidiaries 660,464,338 (31,233,985) (31,233,985) 629,230,353 629,230,353

Other Investments
Aracemco 18,926 - - 18,926 18,926
Total Investments 660,483,264 (31,233,985) (31,233,985) 629,249,279 629,249,279

18
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

(1) The management of Lecico Egypt assessed the need to form an impairment in the value of
investments on December 31, 2024, so it prepared a study for the impairment in the value of the
investment in Lecico (UK) Ltd (a subsidiary) amounting to EGP 303 million based on the
expected future plan for Lecico (UK) Ltd (a subsidiary) in which it adopts achieving profits and
positive results which will reflect positively on the operational and financial indicators in the
coming years for the subsidiaries.
the following table illustrates the methods used to assess the fair value of an investment :

Company Method Important inputs that cannot

be obeserved
Lecico limited UK Discounted cash flows to equity Growth Rate 4.4%
Discount Rate 10%
The company assesses annually whether there is a need to recognize an impairment in the value
of the investment.
(2) The group’s management decided to make a comprehensive restructuring plan for Lecico
Lebanon (one of the group’s subsidiaries) during 2019, in light of the negative results and flows
achieved by the aforementioned company during the previous periods. The restructuring plan for
the subsidiary company includes restructuring its financial and operational aspects, making a
fundamental change in production, as well as a comprehensive examination of the company's
assets and its current value. At the present time, it is not possible to estimate the impact of the
final outcome of the subsidiary company's restructuring plan after the recent events that the State
of Lebanon is going through, as Lebanon is facing unstable political conditions due to the
ongoing war, which had a great impact on its economy and the banking sector, which led to a
decline in economic activity in general during the period, that may have a fundamental impact to
evaluate the company's assets and liabilities resulting from its future activities.

16. Income Tax

16-1 Income tax expense charged to the statement of profit or loss

From 1 April 2025 From 1 January 2025 From 1 April 2024 From 1 January 2024
In Egyptian Pound To 30 June 2025 To 30 June 2025 To 30 June 2024 To 30 June 2024
EGP EGP EGP EGP
Current Income tax expense 20,994,167 40,248,800 21,300,022 124,700,022
Deferred income tax (1,502,992) 946,841 (941,653) (1,484,259)
Dividend tax - - 698,500 698,500
19,491,175 41,195,641 21,056,869 123,914,263

19
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
16-2 Reconciliation of Effective tax rate
Reconciliation of effective tax rate 30/06/2025 30/06/2024
In Egyptian Pound EGP EGP
Profit before tax 119,247,705 628,511,491
Tax rate 22.5% 22.5%
Income tax calculated based on the accounting profit 26,830,734 141,415,085
Non- deductible expenses 36,166,885 13,477,355
Provisions and expected credit losses 9,220,883 20,161,704
Tax exemptions - (149,513,067)
Discounting of notes payables /receivables to its present value
18,456,264 (28,357,679)

Tax Base 183,091,737 484,279,804

Income tax according to the tax return 41,195,641 108,962,956
Investment Income tax - 14,951,307
Income tax according to statement of profit or loss 41,195,642 123,914,263
Effective tax rate 34.5% 19.72%

16-3 Deferred tax assets and liabilities

a- Recognized deferred tax liabilities movement.
Financial position Profit or Loss
Statement Statement
In Egyptian Pound 30/06/2025 31/12/2024 30/06/2025 31/12/2024
EGP EGP EGP EGP
Property, plant & equipment (liability) 10,650,152 9,703,311 946,841 1,399,705
Deferred Tax income 10,650,152 9,703,311 946,841 1,399,705

b- Unrecognized deferred tax assets

Deffered tax assets for these items have not been recognized
In Egyptian Pound 30/06/2025 31/12/2024
EGP EGP
Provisions 19,881,488 21,748,071
Expected credit loss in trades and other receivables 20,297,121 17,923,352
Impairment losses in inventory 2,172,768 2,172,768
Expected credit loss on Cash and Cash equivalents 670,027 670,027
Expected credit loss on Due from related parties 1,085,804 1,085,804
44,107,208 43,600,022

The deferred tax assets related to net Impairment value on provisions, the impairment in the value of debtors
and other debit balances, the impairment in the inventory and Carried forward tax losses have not been
recognized due to the lack of a appropriate degree to ensure the existence of sufficient future tax profits through
which to benefit from these assets.
20
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
16-4 Accrued income tax

In Egyptian Pound 30/06/2025 31/12/2024

EGP EGP
Current Income tax 40,248,800 122,592,131
Tax authority - Balance brought forward 830,332 4,047,576
Tax authority-withholding tax (7,318,361) (19,024,784)
33,760,771 107,614,923

17. Inventories
In Egyptian Pound Note 30/06/2025 31/12/2024
No. EGP EGP
Raw materials 105,526,769 137,116,001
Consumables and spare parts 230,000,286 196,804,848
Work in progress 59,933,790 52,317,567
Finished products 341,923,260 258,076,451
737,384,105 644,314,867
write down of inventory (9,656,745) (9,656,745)
727,727,360 634,658,122
Goods in transit 71,396,060 50,210,542
799,123,420 684,868,664

Write down of inventory.

30/06/2025 31/12/2024

Balance at the beginning of the period /year 9,656,745 9,358,397

Inventory write down during the period / year (4) - 298,348
Balance at the end of the period /year 9,656,745 9,656,745

*The company has obtained credit facilities secured buy inventory (Note no. 19)

21
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

18. Trade and other receivables

In Egyptian Pound Note 30/06/2025 31/12/2024
No. EGP EGP
Trade receivables 887,364,758 578,243,157
Notes receivable 24,214,145 80,843,228
Other trade receivables 27,293,608 32,319,307
Prepaid expenses 14,292,737 5,750,478
Deposits with others 71,157,113 72,552,650
Value add tax authority 73,769,659 46,077,603
1,098,092,020 815,786,423
Expected credit loss in trade and other receivables (90,209,428) (74,833,545)
1,007,882,592 740,952,878

Expected credit loss in trades and other receivables.

In Egyptian Pound Note 30/06/2025 31/12/2024

No. EGP EGP
Balance at the beginning of the period /year 74,833,545 81,695,263
Formed expected credit loss during the period / year (8) 15,375,883 -
Reversal of expired expected credit loss during the period / year (8) - (6,861,718)
Balance at the end of the period /year 90,209,428 74,833,545

22
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

19. Cash and cash equivalents

In Egyptian Pound 30/06/2025 31/12/2024
EGP EGP
Bank current accounts 219,156,272 181,808,047
Time deposits 496,000 38,638,400
Cash on hand 10,835,447 5,126,409
230,487,719 225,572,856
Less :
Expected credit loss in Cash and cash equivalents (2,977,896) (2,977,896)
227,509,823 222,594,960
Restricted time deposits (496,000) (508,400)
Cash and cash equivalents in the statement of cash flows 229,991,719 225,064,456

* Expected credit loss in cash and cash equivalents :

In Egyptian Pound Note 30/06/2025 31/12/2024

No. EGP EGP
Balance at the beginning of the period / year 2,977,896 -
Formed expected credit loss during the period / year (8) - 2,977,896
Balance at the end of the period / year 2,977,896 2,977,896
Time deposit balance represents a fixed depsit of USD 10,000 placed with the Arab African
international Bank for a period of 12 months at an annual interest rate of 0.56 % .

20. Borrowing

20.1 Banks credit facilities

Bank credit facilities represents credit facilities secured by inventories (Note no. 17) and
the total authorized facility limit of overdrafts is EGP 1,281,250,000 as of June 30, 2025
(December 31, 2024: EGP 965,000,000) while unutilized facilities amount is EGP
467,295,080 as of June 30, 2025 (December 31, 2024: EGP 615,299,145) .

23
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

Utilized Banks credit facilities

In Egyptian Pound 30 / 06 / 2025 31 /12 / 2024
EGP EGP
- Commercial International Bank 100,803,614 67,770,910
-Qatar National Alahli Bank 73,127,146 81,668,045
- Arab African International Bank 187,493,786 24,612,089
- Attijariwafa Bank 12,095,613 5,440,663
- Abu Dhabi Islamic Bank - mudarbah 264,505,293 62,039,778
-Al Ahli Bank of Kuwait 9,994,294 -
- National Bank of Egypt 165,935,174 108,063,305
- Misr Bank-Europe - 106,065
813,954,920 349,700,855

20.2 Loans
In Egyptian Pound 30/06/2025 31/12/2024
EGP EGP
Balance at the beginning of the period / year - 9,267,000
Finance cost during the period / year - 498,078
Pay off the principle of the loan - (9,267,000)
Pay off Finance cost during the period / year - (498,078)
- -

21. Trade and other payables

In Egyptian Pound 30/06/2025 31/12/2024

EGP EGP
Trade payables 220,424,660 313,040,501
Notes payables 85,599,771 83,610,776
Other trade payables 12,907,819 5,951,597
Accrued expenses 76,094,695 46,500,597
Social insurance and Tax authority 4,418,499 4,807,479
Dividends payable 4,619,064 389,929
Insurance from others - 211,680,000
404,064,508 665,980,879

24
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
22. Provisions
Claims provision
Note 30/06/2025 31/12/2024
No. EGP EGP
Balance at the beginning of the period /year 96,658,091 99,038,435
Formed provisions during the period / year (9) 15,845,000 28,597,272
Used provisions during the period / year (2,140,921) (30,977,616)
Reversal of expired provision (22,000,000) -
Balance at the end of the period /year 88,362,170 96,658,091

- Provisions represent the value of claims for obligations that are not specified in timing or
amount in relation to the company's activities. The management reviews these provisions
annually and adjusts the amount of the provision according to the latest update, discussions and
agreements with those parties. The formed provisions are charged to the standalone statement of
profit or loss
- The Company did not disclose all of the information required in accordance with revised
Egyptian Accounting Standard as the management assumes that the disclosure of such
information would seriously affect the final settlement of those potential claims.

23. Non-cash changes

For the purposes of preparing the consolidated statement of cash flows, the following
have been excluded from the values of assets and liabilities that don’t represent a change
in cash as follows a statement of the non-cash transactions referred to above:
30/06/2025 30/06/2024
EGP EGP
Treasury Shares dividend - (25,388,998)

24. Long Term Notes Payable

The long term notes payable represent the present value of the notes payable issued in favor of
vendors of company , with due dates more than one period from the reporting date, discounted
at average effective interest rate of the company 20.11 %.

30/06/2025 31/12/2024
In Egyptian Pound EGP EGP

Face value of long term notes payables 196,742,027 233,649,834

Deduct: long term notes payables to its present value (59,668,800) (78,125,064)
Present value of long term notes payable 137,073,227 155,524,770

25
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

25. Objectives and policies for risk management of financial instruments

This note presents information on the Company's financial instruments, including:
• An overview of all financial instruments held by the company.
• Specific information on each type of financial instrument.
• Information about determining the fair value of the instruments, including judgments and
estimation uncertainties.

The Company's main financial instruments include term deposits and financial investments
in financial assets at fair value through profit or loss. The main purpose of these financial
instruments is to raise financing for the company's operations. The Company has many other
financial instruments such as customers and suppliers which arise directly from operations.
The main risks arising from the Company's operations are foreign exchange risk and credit
risk.

Financial Assets
All financial assets owned by a company are measured at amortized cost using the effective
interest rate method and as a result book values are a reasonable approximation of fair value,
except for financial investments measured at fair value.

Financial liabilities
All financial liabilities owned by the company are measured at amortized cost using the effective
interest rate method and as a result the book amounts are a reasonable approximation of fair
value.

The company has the following financial instruments:

Note 30/06/2025 31/12/2024

Financial asset at No. EGP EGP
amortized cost
Bank current accounts and Time deposits (19) 216,674,376 217,468,551
Trade,notes and other receivables (18) 919,820,198 689,124,799
Due from related parties (30-1) 333,191,033 381,951,366
1,469,685,607 1,288,544,716

Financial labilities
Banks credit facilities (20-1) 813,954,920 349,700,855
Trade,notes and other payables (21) 536,719,236 816,698,170
Due to related parties (30-2) 729,454,058 550,940,976
2,080,128,214 1,717,340,001

26
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
All financial assets and liabilities have been classified and measured at amortized cost, and
the fair value of all financial instruments does not differ materially from their book value,
except for financial assets that are measured at fair value.
For the purpose of disclosure of financial instruments, non-financial assets amounting to EGP
88,062,396 June 30 2025 (December 31 2024 : EGP 51,828,081) have been excluded from
other debit balances it was also excluded non financial liabilities amount EGP 4,418,499
(December 31 2024 :EGP 4,807,479) have been excluded from other credit balances.

25.1 Financial Risk Management

Company is exposed to the following risks from its use of financial instruments:
A. Credit risk
B. Liquidity risk
C. Market risk
D. Currency risk
E. Interest rate risk
F. Other market price risk
This note presents information about the Company’s exposure to each of the above risks, the Company’s
objectives, policies and processes for measuring and managing risk, as well as the Company management of
capital. Further quantitative disclosures are included throughout these separate financial statements.

The Board of Directors of the Parent Company has overall responsibility for the establishment and oversight
of the Company’s risk management framework. The Board also identifies and analyzes the risks faced by the
Company, sets appropriate risk limits and controls, and monitors risks and adherence to limits.
The Company aims to develop a disciplined and constructive control environment through which all
employees understand their roles and obligations.
A- Credit Risk
The Company is exposed to credit risk as a result of the counterparty's failure to fulfill its
contractual obligations when due, in respect of the following:
 Trade receivables
 Debtors and other debit balances
 Due from related parties
 Employees' accruals
 Advance Payments
 Cash in banks and on hand
Credit risk is the risk that a company will suffer financial loss as a result of the failure of
the client or counterparty of a financial instrument to fulfill its contractual obligations,
arising mainly from customers. The book value of financial assets represents the maximum
credit risk.

The company's exposure to credit risk is mainly influenced by the individual characteristics
of each client. However, management also takes into account factors that may affect the
credit risk of its customer base, including the risk of default associated with the industry
and the sector in which customers operate.

27
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
For clients, the company has established a credit policy according to which each new client
is individually analyzed according to solvency before submitting the entity's standard
payment and delivery terms and conditions, and includes a review of financial statements,
information about the business and in some cases bank references. Each customer is
assigned a credit limit and reviewed periodically.

When monitoring customer credit risk, clients are grouped according to their credit
characteristics, history of dealing with the company and the presence of previous financial
difficulties.

B- Liquidity risk
Liquidity risk is the risk that the company will not fulfill its obligations according to the
contractual term with third parties. The Company's approach to liquidity management is to
ensure - whenever possible - that it has sufficient liquidity to meet its obligations on their
maturity date in normal and critical circumstances without incurring unacceptable losses or
damaging the Company's reputation.

The ultimate responsibility for liquidity risk management lies with senior management who
have developed an appropriate liquidity risk management framework to manage the
Company's short, medium and long-term funding and manage liquidity requirements.

The Company manages liquidity risk by maintaining adequate reserves, banking facilities,
and standby borrowing facilities, by continuously monitoring expected and actual cash
flows, and by matching asset maturity dates and financial obligations.

Management forecasts cash flows and monitors successive forecasts of the Company's
liquidity requirements to ensure that it has sufficient cash to meet its operational needs
while always maintaining sufficient amount of committed and undrawn credit facilities so
that the Company does not violate borrowing limits or undertakings (if any) on any of its
borrowing facilities. This forecast considers the company's debt financing plans and
compliance with internal rate targets.

C- Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates,
interest rates and equity prices will affect the Company’s income and expenses or the value
of its holdings of financial instruments.
The objective of market risk management is to manage and control market risk exposure
within acceptable parameters, while optimizing the return.

28
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
D- Foreign currency risk
Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to
a change in the foreign exchange rates.

The Company is exposed to foreign currency risk on purchases from foreign suppliers and
loans denominated in foreign currency. The currencies giving rise to this risk are primarily
US Dollar, Euro, Sterling Pound and South African Rand.
The following table displays the impact of an acceptable possible change in the exchange
rates of the US dollar, the euro, the British pound and the South African rand. With all
other variables remaining constant, the impact on the company's profits before taxation is
due to changes in the value of monetary assets and liabilities. Changes in the exchange
rates of all other foreign currencies are considered immaterial.

E- Interest rate risk

The Company adopts a policy to limit the Company’s exposure to interest risk, therefore
the Company’s management evaluates the available alternatives for finance and negotiates
with banks to obtain the best available interest rates and credit conditions. Borrowing
contracts are presented to the Board of Directors. The finance position and finance cost are
periodically evaluated by the Company’s management. The Company does not enter into
hedging contracts for interest rates.

F- Other market price risk

- The company is exposed to risks associated with the pricing of goods from service
providers.
- Selling prices exhibit limited volatility
- To manage price risks, the company constantly monitor supply and demand treads in the
market to determine the optimal time to enter service agreements.
- The company’s management continuously monitors the fluctuations in the prices of key
services.

Credit risk
The carrying amount of financial assets represents the maximum exposure to credit risk as follows:

Note 30/06/2025 31/12/2024

Financial asset at No. EGP EGP
amortized cost
Bank current accounts and Time deposits (19) 216,674,376 217,468,551
Trade,notes and other receivables (18) 919,820,196 689,124,797
Due from related parties (30-1) 333,191,033 381,951,366
1,469,685,605 1,288,544,714

29
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Liquidity risk
This clarification provides the contractual terms for financial obligations
30/06/2025 Carrying Contractual Less than 1 1-2 years 2-5 years
amount amount year
EGP EGP EGP EGP EGP
Banks Credit facilities and overdraft 813,954,920 813,954,920 813,954,920 - -
Trade and other credit balances 399,646,009 399,646,009 399,646,009 - -
Long term notes payable 137,073,227 196,742,027 - 105,167,624 91,574,403
Due to related parties 729,454,058 729,454,058 729,454,058 - -
2,080,128,214 2,139,797,014 1,943,054,987 105,167,624 91,574,403

31/12/2024 Carrying Contractual Less than 1 1-2 years 2-5 years

amount amount year
EGP EGP EGP EGP EGP
Banks Credit facilities and overdraft 349,700,855 349,700,855 349,700,855 - -
Trade and other credit balances 661,173,400 661,173,400 661,173,400 - -
Long term notes payable 155,524,770 233,649,834 - 141,734,577 91,915,257
Due to related parties 550,940,976 550,940,976 550,940,976 - -
1,717,340,001 1,795,465,065 1,561,815,231 141,734,577 91,915,257
Exposure to currency risk

The value of assets and liabilities in foreign currency at the date of the statement of financial position
equivalent to EGP 1,210,868,730 and EGP 875,219,160 (2024: EGP 1,041,629,166 and EGP
522,736,241) respectively. The amounts in foreign currencies that expose the company to risk on
June 30, 2025 are represented in the following, as shown in detail. Balances in foreign currencies, net
at the date of the financial position:

Foreign currency 30/06/2025 31/12/2024

Surplus / (Deficit) Surplus

US Dollar 3,613,341 5,083,273

Euro 3,147,471 2,797,042
Sterling Pound (350,524) 1,581,322
Rand (South Africa) (1,006,420) 4,297,584

30
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
The following is the average exchange rates during the period / year :

Average exchange rate closing rate at the financial

during the period statements date
30/06/2025 31/12/2024 30/06/2025 31/12/2024

US Dollar 50.48 45.59 49.60 50.84

Euro 54.44 49.24 58.16 52.92
Sterling Pound 65.12 58.35 67.93 63.74
Rand (South Africa) 2.74 2.50 2.80 2.71

Sensitivity Analysis
A reasonably possible strengthening (weakening) of 5% other currencies exchange rate against Egyptian
pound As of June 30, 2025, would have affected the measurement of financial instruments denominated in a
foreign currency and affected equity and profit or loss by the amounts shown below. This analysis assumes
that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales
and purchases.
Profit or Loss
Increase Decrease
US Dollar 8,961,087 (8,961,087)
Euro 9,152,847 (9,152,847)
Sterling Pound (1,190,556) 1,190,556
Rand (South Africa) (140,899) 140,899

A reasonably possible strengthening (weakening) of 5% other currencies exchange rate against Egyptian
pound as of December 31, 2024, would have affected the measurement of financial instruments denominated
in a foreign currency and affected equity and profit or loss by the amounts shown below. This analysis
assumes that all other variables, in particular interest rates, remain constant and ignores any impact of
forecast sales and purchases.
Profit or Loss
Increase Decrease
US Dollar 7,304,772 (7,304,772)
Euro 11,858,760 (11,858,760)
Sterling Pound 5,461,135 (5,461,135)
Rand (South Africa) 889,672 (889,672)

31
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Interest rate risk

At the date of separate financial statements, the interest rate profile of the Company’s financial instruments was
as follows: -
Financial instruments with fixed interest rate
30/06/2025 31/12/2024
In Egyptian Pound EGP EGP

Financial Assets - Time deposite 496,000 38,638,400

Financial Liabilies - Notes payable 137,073,227 155,524,770
137,569,227 194,163,170
Financial instruments with variable interest rate
30/06/2025 31/12/2024
In Egyptian Pound EGP EGP

Monatry Assets - Bank current accounts 219,156,272 181,808,047

Monatary Liabilites - credit facilities 813,954,920 349,700,855
1,033,111,192 531,508,902

The Company does not account for any fixed rate financial assets and liabilities at fair value through profit or
loss. The Company does not designate derivatives (interest rate swaps) as hedging instruments under a fair
value hedge accounting model. Therefore, a change in interest rates at the separate financial statements date
would not affect the separate statement of profit or loss.

Assessment of expected credit losses

The Company customizes each credit risk exposure based on a variety of data that is identified
as loss risk statements based on forecasting and expertly applying credit judgment. Credit risk
scores are defined using qualitative and quantitative factors that indicate the risk of loss.
Exposure risk for each credit risk category is classified by sector according to industry
classification and customer classification and the expected credit loss rate for each sector is
calculated based on the status of late payment and actual credit loss experience. These rates are
multiplied by gradient factors to reflect the differences between economic conditions during the
period in which historical data was collected, current conditions, and the company's view of
economic conditions over the expected lifespan of customer balances.

32
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

Measurement of Expected Credit Losses for trade receivables

The company assigns each exposure a credit risk rating based on the data identified to predict loss
risks (including, but not limited to, external ratings and management accounts).
A simplified approach has been used in measuring credit risk for customer and receivables items
by categorizing customers into groups with similar characteristics, determining the historical
period used to calculate the loss rate, which ranges from two to five years, and establishing the
loss rate based on historical data while considering expected changes in macroeconomic indicators
(such as growth rate, inflation rate, and unemployment rate). These rates are then multiplied by
numerical factors to reflect the differences between economic conditions during the years in which
the historical data was collected and current conditions.
the following table represent information about credit risk & credit loss for trade receivables
and other debit balance :
30/06/2025 31/12/2024
Expected credit Book Loss Expected credit Book Loss
loss rate Value Value loss rate Value Value
trade & note receivables
Not Due - 755,941,687 - - 527,966,078 -
0 - 90 Days 14.41% 60,425,724 8,706,618 12.00% 19,602,596 2,401,133
91 - 180 Days 37.98% 27,352,599 14,729,656 25.00% 1,154,470 289,196
181 - 270 Days 48.96% 1,276,933 625,139 4.00% 11,735,423 443,992
271 - 360 Days 62.76% 1,165,374 731,429 15.00% 31,718,376 4,789,781
more than 360 Days 100.00% 65,416,586 65,416,586 100.00% 66,909,443 66,909,443
Total 911,578,903 90,209,428 659,086,386 74,833,545

Category Company’s definition of category Basic for expected credit loss

provision.
Performing Other receivables have a low risk of default and a 12 month expected losses.
strong capacity to meet contractual cash flows. Where the expected lifetime of
an asset is less than 12 months,
expected losses are measures at
its expected lifetime.
Under performing Other receivables which have a significant increase Lifetime expected losses.
in credit risk a significant increase in credit risk is
presumed if repayments are 90 days past due
Non-performing Repayment are 120 days past due. Lifetime expected losses
Provision Repayments are 360 days past due and there is no Asset is written off
reasonable expectation of recovery.

33
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Fair Value of Financial Instruments
- "Fair value" is the price that will be received for the sale of an asset or paid for the transfer of an
obligation in a structured transaction between market participants on the date of measurement in
the asset or, in its absence, in the most advantageous market that the Company has access on that
date. The fair value of liabilities reflects the risk of non-performance.

- A number of accounting policies and disclosures require a company to measure the fair values of
both financial and non-financial assets and liabilities.

- The company has consistent practices regarding the measurement of fair values. Management is
fully responsible for overseeing all significant fair value measurements, including the third fair
value level.

- Management regularly reviews significant unnoteworthy inputs and evaluation adjustments. If

third party information is used, such as broker quotes or pricing services. To measure fair value,
management evaluates evidence obtained from third parties to support the conclusion that these
valuations meet the requirements of Egyptian Accounting Standards including the level in the
fair value hierarchy at which these valuations should be classified.

- When measuring the fair value of an asset or liability, evaluators use market data that is as
observable as possible. Fair values are classified into different levels in the fair value sequence
based on the inputs used in valuation methods as follows:

Level I: Prices listed (unadjusted) in active markets for similar assets or liabilities
Level II: Inputs other than the prices listed are included in the first level and can
be observed for the asset or liability either directly (e.g. prices) or indirectly (i.e. derived from
prices)
Level III: Asset or liability inputs that are not based on observable market data (unobserved
inputs)

If the inputs used to measure the fair value of an asset or liability fall at different levels of the fair
value hierarchy, then the entire fair value measurement is classified at the same level of the fair
value hierarchy as the lowest level of input as it is important for the entire measurement.

The Company recognizes transfers between levels of the fair value hierarchy at the end of the
reporting period during which the change occurred.

nominal values minus any estimated credit adjustments to assets and liabilities with a maturity of
less than one year are expected to approximate their fair value. The fair values of non-current
financial obligations are considered to be close to their book values because they carry interest
rates, which are based on market interest rates.

34
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
26. Share capital and reserves

26.1 Authorized capital

The authorized capital was determined to be EGP 500 million distributed to 100 million
shares with par value of EGP 5 per share.
26.2 Issued and paid up capital
The issued capital was determined and to be EGP 400 million (four hundred million
Egyptian pounds) divided to 80 million shares (eighty million shares) nominal share with
par value of EGP 5 (five Egyptian pounds) per share fully paid.

The company’s capital structure consists of:

Shareholder Name % No. of Shares

Intage Holding Limited and its related %43.63 34,907,903

Al Olayan Saudi Arabia Investment Limited %19.1 15,278,385
Others %37.27 29,813,712
Total %100 80,000,000

- The holders of ordinary shares are entitled to receive dividends as declared from time to
time and are entitled to one vote per share at meetings of the company. All shares rank
equally with regards to the Company’s residual assets. All rights relating to shares
temporarily held by the company (treasury shares) if any are suspended until those shares
are reissued.

- Capital management
The policy of the company's board of directors is to maintain a strong capital in order to
maintain the confidence of investors, creditors and the market, as well as to meet future
developments of the activity.

The company's board of directors monitors the return on capital, which the company
determines as net profit for the year divided by total equity. The company's board of
directors also monitors the level of dividends for shareholders.
There are no changes in the company's capital management strategy during the period. The
company is not subject to any external requirements imposed on its own capital.

35
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
26.3 Reserves
In Egyptian Pound 30/06/2025 31/12/2024
EGP EGP
Legal Reserve * 72,410,417 50,915,481
Capital Increase Reserve 4,000,000 4,000,000
Other Reserves 1,571,486 1,571,486
Special Reserve 181,943,608 181,943,608
Land Revaluation Surplus ** 42,901,149 42,901,149
302,826,660 281,331,724

* Legal reserve
According to the Companies’ Law and the Company’s statues the Company is required to
set aside 5% of the annual net profit to form a legal reserve. The transfer to legal reserve
ceases once the reserve reaches 20% of the issued share capital based on company’s
statues. The reserve is undistributable, however, it can be used to increase the share capital
or offset losses. If the company continuous to set aside 5% of the issued share capital , the
reserve falls below the defined level (20% of the issued share) .

Legal reserve has been increased with an amount of 21,494,936 EGP from the profit of
year 2024 according to the decree of general assembly held on march 27, 2025.

** Land revaluation surplus

Land revaluation surplus is represented in the adjusted value of Khorshid & Abou-Quir
land that was modified to reevaluate the book value of company’s assets with its market
value at the date of revaluation in the year 1997. The revaluation result was included in the
revaluation surplus in the shareholders’ equity. That surplus is undistributable or
transferable to capital.

27. Treasury shares

On March 18, 2023 the senior management approve to purchased 3,200,000 shares of the
company's shares at a price of EGP 7.934 per share through the capital market, which
represents 4% of the company's capital issues and traded in stocks exchange market.
On November 11, 2023, the Board of Directors of Lecico Egypt decided to approve the
distribution of all previously purchased treasury shares to the company’s shareholders as
free shares, and legal and administrative measures have been taken for that and excluded on
January 12,2024.

28. Capital commitments

There is capital commitments for the company as of June 30,2025 amounted Zero EGP
( December 31,2024 amounted 4,451,581 EGP ).

36
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
29. Contingencies liabilities

In Egyptian Pound 30/06/2025 31/12/2024

EGP EGP
Uncovered portion of letters of guarantee 21,220,277 5,460,927
Letters of credit 30,552,435 29,052,339
51,772,712 34,513,266
30. Related parties
Related parties are represented in the Company’ shareholders, board of directors, executive
directors and Companies in which they own directly or indirectly shares giving them
significant influence over these Companies. The Company made several transactions
during the year with related parties and these transactions have been done in accordance
with the terms determined by the Company’s management and have been approved by the
Company’s Ordinary General Assembly.

A summary of significant transactions concluded during the period at the separate financial
position date were as follows:
30/06/2025 31/12/2024
Party Nature Transaction Transaction
Nature Transaction Amount Amount
Lecico PLC A subsidiary Sales 169,929,669 239,031,324
Lebanese Ceramic Industries Co. A subsidiary Sales 8,082,958 10,031,379
Lecico for Trading & Distribution Ceramics A subsidiary Sales 90,049,291 157,748,769
Lecico South Africa A subsidiary Sales 14,597,363 15,343,833
Lecico Poland A subsidiary Sales 2,585,301 3,727,017
Burg Armaturen Fabrik A subsidiary Purchase 3,950,435 8,915,009
Dividends income
Burg Armaturen Fabrik A subsidiary 13,970,000 6,985,000
from subsidary
Lecico for Ceramics Industries A subsidiary Sales 16,339,899 30,463,209
Lecico for Ceramics Industries A subsidiary Purchase 356,892,149 513,856,575
Sarreguemines A subsidiary Sales 16,755,379 48,679,740
European Ceramics Co. A subsidiary Sales 9,152,645 21,616,652
European Ceramics Co. A subsidiary Purchase 7,640,460 2,376,269
International Ceramics Co. A subsidiary Sales 70,703,400 143,829,330
International Ceramics Co. A subsidiary Purchase 54,477 -
Ceramic Management and Services Limited Related party Technical consultations 26,457,288 -

37
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

30-1 Due From Related Parties

30/06/2025 31/12/2024
EGP EGP
Lecico PLC 54,047,121 78,925,281
Lebanese Ceramic Industries Co. 158,264,043 162,246,249
Lecico for Trading & Distribution Ceramics 27,970,783 32,775,489
Lecico South Africa 17,208,579 11,646,452
Lecico Poland 6,580,527 9,166,304
Burg Armaturen Fabrik 16,174,691 -
Sarreguemines 57,771,085 64,072,008
European Ceramics Co. - 27,945,379
Total Due From Re lated Partie s 338,016,829 386,777,162
Expected credit loss in related parties (4,825,796) (4,825,796)
333,191,033 381,951,366

Expected credit loss in due from related parties

In Egyptian Pound Note 30/06/2025 31/12/2024
No. EGP EGP
Balance at the beginning of the period /year 4,825,796 -
Formed expected credit loss during the period / year (8) - 4,825,796
Balance at the end of the period /year 4,825,796 4,825,796

30-2 Due to Relate d Parties

30/06/2025 31/12/2024
EGP EGP
Ceramic Management and Services Limited 14,606,694 -
Lecico For Financial Investments 2,798,403 2,812,308
T.G.F for Consulting & Trading 2,320,095 2,473,049
European Ceramics Co. 17,113,696 -
Burg Armaturen Fabrik - 7,256,205
International Ceramics Co. 66,683,538 56,504,649
Lecico for Ceramics Industries 625,931,632 481,894,765
Total Due to Related Parties 729,454,058 550,940,976

38
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
30-3 The top management payments:
The top management is represented by the Board of Directors and the main managers of the
company. The salaries and benefits that were paid to the senior management during the financial
period amounted to:

30-3-I Top management payments

30/06/2025 31/12/2024
EGP EGP

Board of Directors Benefits and Allowances 30,000 60,000

15,000 60,000

30-3-II Non-Executive management payments

30/06/2025 31/12/2024
EGP EGP

Salaries and benefits 58,772,991 31,778,221

58,772,991 31,778,221
31. Tax statues

The following is the Company's tax status as of June 30, 2025, according to the opinion of the
Company's tax administration.

First: Corporate income tax

The company submits tax returns on the legal dates in accordance with the provisions of the law
and pays all tax obligations,
- The final settlement was made, and all tax obligation was paid from inception till 2019 , expect
part of late charges.
- The company’s records were not examined from 2020 to date.

Second: Payroll tax

The company submits tax returns on the legal dates in accordance with the provisions of the law
and pays all tax obligations,
- The tax examination was completed and all tax obligations were paid until 2022, Expect late
charges.
- The company’s records were not examined from 2023 to date.

Third: Stamp tax

- The final settlement was made, and all tax obligation arisen was paid from inception until 2022.
- The company’s records were not examined from 2023 to date

Fourth: Sales tax \ Value added tax

The company submits tax returns on the legal dates in accordance with the provisions of the law
and pays all tax obligations, if any.

39
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
- The tax examination was completed and all tax obligations were paid from inception till 2023,
Expect late charges.
- The company’s records were not examined from 2024 to date.

Fifth: Real estate tax

- All tax obligations were paid until 2021.

- A temporary exemption was issued from real estate tax for industrial companies for 3 years, the
agreement has been renewed for another 2 years ending on December 31,2026.

 The company's management believes the tax provisions are sufficient to cover any potential tax
liabilities.

 The company is committed to providing the master file, the local file and the report at the
country losed for each of its commercial . and financial transactions to modify the transactions in
favor of Egyptian tax authority in accordance with the united tax revenue loan no. 206 of 2020
and its amendments.

32. Material Accounting Policies

The accounting policies mentioned below have been applied to periods presented in the
separate financial Statements.

32-1 Foreign currency translation

32-1-1 Foreign currency transactions

- Transactions in foreign currencies are translated at the foreign exchange rate prevailing at the date of the
transaction.
- Monetary assets and liabilities denominated in foreign currencies are translated into the functional
currency at the exchange rate at the reporting date.
- Assets and liabilities that are measured at fair value in a foreign currency are translated at the exchange
rate when the fair value was determined.
- Non - monetary assets and liabilities that are measured based on historical cost in a foreign currency are
translated at the exchange rate at the date of the transaction.
- Foreign currency differences are generally recognized in profit or loss, however, foreign currency
differences arising from the translation of the following items are recognized in OCI:
 Financial assets at fair value through OCI (except impairment, in which case foreign currency differences
that have been recognized in OCI are reclassified to profit or loss).
 A financial liability designated as a hedge of the net investment in a foreign operation to the extent that
the hedge is effective.
 Qualifying cash flow hedges to the extent that the hedges are effective.

40
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
32-2 Revenue from contracts with Customers

Revenue from contracts with customers is recognized by the company based on five step -
:module as identified in EAS No. 48
Step 1: Determine the contract (contracts) with customer: A contract is defined as an
agreement between two or more parties that meets the rights and obligations based on
specified standards which must be met for each contract.

Step 2: Determine the performance obligations in contract: Performance obligations is a

consideration when the goods and services are delivered.

Step 3: Determine the transaction price: Transaction price is the compensation amount that
the Company expects to recognize to receive for the transfer of goods or services to
customer, except for the collected amounts on behalf of other parties.

Step 4: Allocation of the transaction price of the performance obligations in the contract: If
the service concession arrangement contains more than one performance obligation, the
Company will allocate the transaction price on each performance obligation by an amount
that specifies an amount against the contract in which the Company expects to receive in
exchange for each performance obligation satisfaction.

Step 5: Revenue recognition when the entity satisfies its performance obligations.
The Company satisfy the performance obligation and recognize revenue over time, if one
of the following criteria is met:

a) Company performance does not arise any asset that has an alternative use of the Company
and the Company has an enforceable right to pay for completed performance until the date.

b) The Company arise or improves a customer-controlled asset when the asset is arise or
improved.

c) The customer receives and consumes the benefits of Company performance at the same time
as soon as the Company has performed.

For performance obligations, if one of the above conditions is met, revenue is recognized in
the period in which the Company satisfies performance obligation.
When the Company satisfies performance obligation by providing the services promised, it
creates an asset based on payment for the contract performance obtained, when the amount
of the contract received from customer exceeds the amount of the revenue recognized,
resulting advance payments from the customer (contractual obligation)

Revenue is recognized to the extent that is potential for the flow of economic benefits to the
Company, revenue and costs can be measured reliably, where appropriate.

41
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
The application of Egyptian Accounting Standard No. (48) requires management to use the
following judgements: -

Satisfaction of performance obligation

- The Company should assess all contracts with customers to determine whether performance
obligations are satisfied over a period or at a point in time in order to determine the appropriate
method for revenue recognition. The Company estimated that, and based on the agreement with
customers, the Company does not arise asset has alternative use to the Company and usually has
an enforceable right to pay it for completed performance to the date.
- In these circumstances, the Company recognizes revenue over a period of time, and if that is not
the case, revenue is recognized at a point in time for the sale of goods, and revenue is usually
recognized at a point in time.

Determine the transaction price.

- The Company must determine the price of the transaction in its agreement with customers, using
this judgement, the Company estimates the impact of any variable contract price on the contract
due to discount, fines, any significant financing component in the contract, or any non-cash
contract.

Control transfer in contracts with customers

- If the Company determines the performance obligations satisfaction at a point of time, revenue is
recognized when control of related contract’ assets are transferred to the customer.

In addition, the application of Egyptian Accounting Standard (EAS) No. 48 has resulted in:

Allocation of the transaction price of performance obl igation in contracts with

customers
The Company selected to apply the input method to allocate the transaction price to
performance obligations accordingly that revenue is recognized over a period of time, the
Company considers the use of the input method, which requires recognition of revenue
based on the Company's efforts to satisfy performance obligations, provides the best
reference to the realized revenue. When applying the input method, the Company estimates
efforts or inputs to satisfy a performance obligation. In addition to the cost of satisfying a
contractual obligation with customers, these estimates include the time spent on service
contracts.

Other matters to be considered.

Variable consideration if the consideration pledged in a contract includes a variable amount,
then the Company shall estimate the amount of the consideration in which it has a right in
exchange for transferring the goods or services pledged to the customer, the Company
estimates the transaction price on contracts with the variable consideration using the
expected value or the most likely amount method. This method is applied consistently
throughout the contract and for identical types of contracts.

The significant funding component

The Company shall adjust the amount for the contract pledged for the time value of the cash
if the contract has a significant funding component.

42
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Revenue recognition

a. Product sales
Management evaluated the impact of applying the standard by applying the model referred to above and
concluded that the current basis for revenue recognition is still appropriate because the only performance
obligation is to deliver the quantities sold to its customers , whether domestic or export , since according to
the agreements concluded with customers , the company transfers control over the quantities sold to
customers according to the following :
Local sales : The date of authorization for the goods to leaves the company’s gates.
Export Sales : according to shipping term.
The value of revenue is measured by fair value of consideration received or due to the facility. Revenue is
realized when there is sufficient economic benefits that will flow to the facility ,and the value of this
revenue can be measured accurately No revenue is recognized in the event that not certain that the
consideration will be recovered for this or cost associated with it.

b. Services revenue
Service revenue is recognized when the service is rendered to customers. No revenue is recognized if there
is uncertainty for the consideration or its associated costs

c. Dividends
Dividends income is recognized in the separated statement of profit or loss on the date the Company’s right
to receive payments is established.

d. Gain on sale of investments

The gain on sale of financial investments are recognized when ownership transfers to the buyer, based on
the difference between the sale price and it carrying amount at the date of the sale.

32-3 Employees benefits

32-3-1 Short term employee benefit

Short term employee benefit are recognize as an expense when the related service is
provided .The amount expected to be paid is recognize as a liability when the company has
a legal or implicit obligation to pay this amount and the obligation can be changed to a
reliable degree.

32-3-2 Workers’ pension system

The company contributes to the governmental social insurance system for the benefit of its
employees in accordance with the Social Insurance Law. Employees and employers under
this law contribute to the system with a fixed percentage of wages. The company's
commitment is limited to the value of its contribution, and the company's contributions are
charged to the income statement according to the accrual basis.

32-4 Finance income and finance costs

The Company’s finance income and finance costs include:
interest income;
interest expense;
Dividends;
Impairment loss for financial assets other than trade receivables;

43
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Losses of hedging contracts for foreign exchange rates;
Interest income or expense is recognized using the effective interest method.
Dividends are recognized in the profit or loss statement at the date of declaration of these
dividends.

32-5 Income tax

The current tax and the deferred tax are recognized as revenue or as an expense in the profits
or losses of the period, except in cases where the tax arises from a process or event that is
recognized - in the same period or in a different period - outside the profits or losses,
whether in other comprehensive income or within equity. direct or business combination.

32-5-1 Current income tax

Current taxes for the current period and previous periods that have not yet been paid are
recognized as a liability, but if the taxes that have already been paid in the current period
and previous periods exceed the value due for these periods, then this increase is recognized
as an asset. The values of current tax liabilities (assets) for the current and prior periods are
measured at the value expected to be paid to (recovered from) the tax administration, using
tax rates (and tax laws) that are in force or about to be issued at the end date of the financial
period. Dividends are taxed as part of the current tax. Offsetting tax assets and liabilities is
only made when certain conditions are met.

32-5-2 Deferred tax

Deferred tax is recognized for temporary differences between the accounting basis of assets
and liabilities and the tax basis of those assets and liabilities. Deferred tax is recognized for
all temporary differences expected to be taxable except for the following:
• First recognition of goodwill,
• Initial recognition of the asset or obligation of the process that:
(1) Not a compilation of works.
and (2) does not affect the net accounting profit or tax profit (tax loss).
•Temporary differences associated with investments in subsidiaries, sister companies and
shares in joint ventures to the extent that the timing of reversing these temporary differences
can be controlled and it is likely that such differences will not be reversed in the foreseeable
future.

A deferred tax asset arising from the carrying forward of tax losses, the right to unused tax
deduction and temporary deductible differences are recognized when there is a strong
possibility of future taxable profits from which that asset can be used. The future tax profit
is determined by the company's future business plan. The position of unrecognized deferred
tax assets is reassessed at the end of each fiscal period and deferred tax assets that have not
previously been recognized are recognized to the extent that it is likely in the future that
there will be a tax profit that allows the value of the deferred tax asset to be absorbed.
Deferred tax is measured using the tax rates expected to be applied when temporary
differences are realized, using tax rates in force or in the process of being issued.
When measuring deferred tax at the end of the financial period, the tax effects of the
procedures followed by the company for recovery or payment of the book value of its assets
and liabilities are taken into account.
Tax assets and liabilities are not cleared unless certain conditions are met.
44
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

32-6 Inventories
Inventories are measured at the lower of cost or net realisable value. The cost of inventories
is based on the weighted average method. The cost also includes other expenses incurred
by the company to bring the inventory to its location and its current condition.
The net realisable value is determined on the basis of the expected selling price under
normal circumstances, minus the estimated costs required to complete the sale.
Any impairment in the value of the inventory caused by a decrease in the net realisable
value of the inventory is recognized in its book value, as are all other inventory losses, as
an expense in the year in which the decrease or loss occurs.

32-7 Fixed assets and depreciation

32-7-1 Recognition and measurement

Items of fixed assets are measured at cost less accumulated depreciation and any
accumulated impairment losses.
If significant parts of an item of fixed assets have different useful lives, then they are
accounted for as separate items (major components) of fixed assets.
Any gain or loss on disposal of an item of fixed assets is recognised in profit or loss.

32-7-2 Subsequent expenditure

Subsequent expenditure is capitalised only if it is probable that the future economic benefits
associated with the expenditure will flow to the Company.

32-7-3 Depreciation
The depreciable value of a fixed asset – which is the cost of the asset – is depreciated
according to the straight-line method over the estimated useful life of each type of fixed
asset, and depreciation is charged to profits or losses. Land is not depreciated
The estimated useful lives of fixed assets for current and comparative periods are as
follows:
Estimated useful lives
Asset (Years)
Buildings and constructions 20 - 40
Machinery and equipment 3-10
Vehicles 5
Tools 5
Furniture & office equipment 10
Computers 5

The methods of useful lives and the estimated value of assets are reviewed on the date of the
financial statements.
Improvements in leased assets are depreciated over the term of the contract or its useful life,
whichever is less. The depreciation method and useful lives of fixed assets are reviewed at
the end of each fiscal period, and modified if necessary.

45
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
32-8 Projects under construction
All expenditures directly attributable to bringing the asset to a working condition for its
intended use are recorded in projects under construction. Whenever the assets are completed
and are ready for their intended use, it will be transferred to fixed assets caption. Projects
under construction are recorded at cost and it is not depreciated unless it was transferred to
fixed assets.

32-9 Intangible assets

the recognition and initial measurement of this item represent the cost of acquiring
software expected to be used, either thtough sale or operation. It is recorded at cost less
accumulated depreciation and impairment losses. Depreciation begins once the software
is ready for use, based on an estimate made by the management, which is prepared
according to expectations regarding the benefits from the sale or operation of the
software. This study should be reviewed periodically to verify the future benefit of such
software and its potential for sale or operation. Depreciation is calculated using the
straight-line method if future benefits are confirmed. If there is no certainty regarding the
future benefit of thes expenses, depreciation is calculated over the remaining useful life of
the asset. The depreciation expense if recognized in the income statement as it is incurred
and allocated to the operating costs benefiting from the software .

The useful life of intangible assets :

Computer Software 5 years

32-10 Financial instruments

A- Financial assets
Recognition and initial measurement
Trade receivables and debt securities issued are initially recognized when they are originated.
All other financial assets and financial liabilities are initially recognized when the Company
becomes a party to the contractual provisions of the instrument.
A financial asset (unless it is a trade receivable without a significant financing component) or
financial liability is initially measured at fair value plus, for an item not at fair value through
profit or loss, transaction costs that are directly attributable to its acquisition or issue. A trade
receivable without a significant financing component is initially measured at the transaction
price.

Classification and subsequent measurement

Financial assets
On initial recognition, a financial asset is classified as measured at: amortized cost; FAIR VALUE
through other comprehensive income – debt investment; fair value through other comprehensive
income – equity investment; or fair value through profit or loss.
Financial assets are not reclassified subsequent to their initial recognition unless the Company changes
its business model for managing financial assets, in which case all affected financial assets are
reclassified on the first day of the first reporting period following the change in the business model.
A financial asset is measured at amortized cost if it meets both of the following conditions and is not
designated as at fair value through profit or loss:

46
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
- It is held within a business model whose objective is to hold assets to collect future cash flows.
- Its contractual terms give rise on specified dates to cash flows that are solely payments of principal
and interest on the principal amount outstanding.

A debt investment is measured at fair value through other comprehensive income if it meets both of the
following conditions and is not designated as at fair value through profit or loss:
- It is held within a business model whose objective is achieved by both collecting contractual cash
flows and selling financial assets.

- Its contractual terms give rise on specified dates to cash flows that are solely payments of principal
and interest on the principal amount outstanding.
On initial recognition of an equity investment that is not held for trading, the Company may irrevocably
elect to present subsequent changes in the investment’s fair value in OCI. This election is made on an
investment-by-investment basis.

All financial assets not classified as measured at amortized cost or fair value through other
comprehensive income as described above are measured at fair value through profit or loss. This
includes all derivative financial assets. On initial recognition, the Company may irrevocably designate a
financial asset that otherwise meets the requirements to be measured at amortized cost or at fair value
through other comprehensive income as at fair value through profit or loss if doing so eliminates or
significantly reduces an accounting mismatch that would otherwise arise.

Financial assets

The Company makes an assessment of the objective of the business model in which a financial asset is held at a
portfolio level because this best reflects the way the business is managed, and information is provided to
management. The information considered includes:
- The stated policies and objectives for the portfolio and the operation of those policies in practice. These
include whether management’s strategy focuses on earning contractual interest income, maintaining a
particular interest rate profile, matching the duration of the financial assets to the duration of any related
liabilities or expected cash outflows or realizing cash flows through the sale of the assets;
- How the performance of the portfolio is evaluated and reported to the Company’s management; and
- The risks that affect the performance of the business model (and the financial assets held within that
business model) and how those risks are managed;
- How managers of the business are compensated – e.g. whether compensation is based on the fair value of
the assets managed or the contractual cash flows collected; and
- The frequency, volume and timing of sales of financial assets in prior periods, the reasons for such sales
and expectations about future sales activity.

Transfers of financial assets to third parties in transactions that do not qualify for de-recognition are not
considered sales for this purpose, consistent with the Company’s continuing recognition of the assets.
Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value
basis are measured at fair value through profit or loss.

47
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Financial assets – Assessment whether contractual cash flows are solely payments of principal and
interest

For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial
recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated
with the principal amount outstanding during a particular period of time and for other basic lending risks and
costs (e.g. liquidity risk and administrative costs), as well as a profit margin.
In assessing whether the contractual cash flows are solely payments of principal and interest, the Company
considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a
contractual term that could change the timing or amount of contractual cash flows such that it would not meet
this condition. In making this assessment, the Company considers:
 Contingent events that would change the amount or timing of cash flows;
 Terms that may adjust the contractual coupon rate, including variable-rate features;
 Prepayment and extension features; and
 Terms that limit the Company’s claim to cash flows from specified assets (e.g. non-recourse features).

A prepayment feature is consistent with the solely payments of principal and interest criterion if the prepayment
amount substantially represents unpaid amounts of principal and interest on the principal amount outstanding,
which may include reasonable additional compensation for early termination of the contract. Additionally, for a
financial asset acquired at a discount or premium to its contractual per amount, a feature that permits or requires
prepayment at an amount that substantially represents the contractual par amount plus accrued (but unpaid)
contractual interest (which may also include reasonable additional compensation for early termination) is treated
as consistent with this criterion if the fair value of the prepayment feature is insignificant at initial recognition.

Financial assets – Subsequent measurement and gains and losses

Financial assets Financial assets at fair value through profit or loss are measured at fair
classified at fair value. Changes in the fair value, including any interest or dividend
value through income, are recognized in profit or loss.
profit or loss

Financial assets at These assets are subsequently measured at amortized cost using the
amortized cost effective interest method. The amortized cost is reduced by impairment
losses. Interest income, foreign exchange gains and losses and
impairment are recognized in profit or loss. Any gain or loss on de-
recognition is recognized in profit or loss.

Equity investments These assets are subsequently measured at fair value. Dividends are
at fair value recognized as income in profit or loss unless the dividend clearly
through other represents a recovery of part of the cost of the investment. Other net
comprehensive gains and losses are recognized in OCI and are never reclassified to
income profit or loss.

Debt investments These assets are subsequently measured at fair value. Interest income
at fair value calculated using the effective interest method, foreign exchange gains
through other and losses and impairment are recognized in profit or loss. Other net
comprehensive gains and losses are recognized in OCI. On de-recognition, gains and
income losses accumulated in OCI are reclassified to profit or loss.

48
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Financial Liabilities
Financial liabilities are classified as either measured at amortized cost or at fair value through profit or
loss. A financial liability is classified at fair value through profit or loss if it is designated as held for
trading, or if it is a derivative or designated as such upon initial recognition. Financial liabilities measured
at fair value through profit or loss recognize gains and losses, including any interest expenses, in the
profit or loss statement. Other financial liabilities are subsequently measured at amortized cost using the
effective interest method. Interest expenses and foreign exchange gains or losses are recognized in profit
or loss. Any gain or loss upon derecognition is also recognized in the profit or loss statement.

Derecognition from Books

Financial Assets
A financial asset is derecognized by the company when the contractual right to receive cash flows from
the financial asset has expired, or when it has transferred the contractual right to receive cash flows from
the financial asset in a transaction that transfers substantially all the risks and rewards of ownership of the
financial asset. Alternatively, if the company has not transferred or retained substantially all the risks and
rewards of ownership of the financial asset and has not retained control, the asset is also derecognized.
The company may enter into transactions that involve transferring recognized assets in its statement of
financial position, while retaining all or substantially all the risks and rewards of the transferred assets. In
these cases, the transferred assets are not derecognized.

Financial Liabilities
A financial liability is derecognized when it is extinguished, either through settlement, cancellation, or
expiration of the term specified in the contract. The company also derecognizes a financial liability when
its terms are modified, and the cash flows of the modified liabilities differ significantly; in this case, a
new financial liability is recognized based on the modified terms at fair value.
Upon derecognition of a financial liability, the difference between the carrying amount settled and the
consideration paid (including any non-cash assets transferred or liabilities incurred) is recognized in the
profit or loss statement.

32-11 Share capital

32-11-1 Ordinary shares

Incremental costs directly attributable to the issue of ordinary shares are recognised as a
deduction from equity. Income tax relating to transaction costs of an equity transaction are
accounted for in accordance with EAS 24 ”Income tax”.

32-11-2 Repurchase of share capital (Treasury shares)

When the shares of the issued capital are repurchased, the amount paid for the repurchase,
which includes all direct costs related to the repurchase, is recognized as a reduction of
equity. Shares repurchased are classified as treasury shares and are shown deducted from
equity. When selling or re-issuing treasury shares, the amount collected is recognized as an
increase in shareholders' equity, and the surplus or deficit resulting from the transaction is
presented within the issuance premium.

49
LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
32-12 Impairment
Non-derivative financial assets

Financial instruments and assets arising from the contract

The Company recognizes expected credit loss for the following items:
- Financial assets that are measured at amortized cost.
- For investments in debt instruments that are measured at fair value through other
comprehensive income.
- Assets arising from the contract.
The Company measures the loss at an amount equal to the lifetime ECL of the financial asset,
except for the following, which are measured at an amount equal to the 12-month ECL:
Debt instruments that are determined to have low credit risk at the reporting date.
Other debt instruments and bank balances in which credit risk (ie the risk of default over the
expected life of the financial instrument) has not increased significantly since initial
recognition.
Commercial customer losses and assets arising from contracts are always measured at an
amount equal to their lifetime expected credit losses.

When determining whether the credit risk of a financial asset has increased significantly since
initial recognition and when estimating expected credit losses, the Company considers
reasonable and supportable information that is relevant and available without undue cost or
effort. This includes both quantitative and qualitative information and analyses, based on the
company's historical experience and known credit rating including forward-looking
information.
The Company assumes that the credit risk of a financial asset has increased significantly if it
has been past due for collection for a period of more than 30 days.

The Company considers a financial asset to be in default when:

- It is unlikely that the Borrower will pay its credit obligations to the Company in full,
without recourse on the part of the Company to measures such as liquidation of the collateral
(if any); or
- The financial asset according to the terms of payment and the nature of each customer
sector separately and in light of the study of expected credit losses prepared by the company.
The Company considers debt instruments to have low credit risk when their credit risk rating
is equal to the globally understood definition of "investment grade".
Lifetime expected credit losses are the expected credit losses that result from all possible
failure events over the expected life of the financial instrument.
12-month expected credit losses are the portion of expected credit losses that result from
default events that are possible within the 12-month period after the reporting date (or a
shorter period if the expected life of the instrument is less than 12 months).
The maximum period considered when estimating expected credit losses is the maximum
contractual period over which the company is exposed to credit risk.

50
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
Measure expected credit losses
It is a probability-weighted estimate of credit losses. The present value of all cash shortfalls is
measured (ie the difference between the cash flows due to the entity in accordance with the
contract and the cash flows that the entity expects to receive).
Expected credit losses are discounted at the effective interest rate of the financial asset.

Credit impaired financial assets

At each reporting date, the company assesses whether financial assets carried at amortized
cost and debt instruments measured at fair value through other comprehensive income are
credit impaired. A financial asset is considered “credit-impaired” when one or more events
occur that have a detrimental effect on the estimated future cash flows of the financial asset.

Evidence indicating credit impairment of financial assets includes observable data:

Significant financial difficulty for the lender or issuer.
a breach of contract such as defaulting on or being more than 120 days past due and a
restructuring of a loan or advance by the Company on terms that the Company will not
otherwise observe, and the Borrower is likely to enter bankruptcy or other financial
reorganization; or the disappearance of an active market for a security because of financial
difficulties.

Display expected credit losses in the statement of financial position

The loss allowance for financial assets that are measured at amortized cost is deducted from
the total amount of the carrying amount of the assets.
For debt securities that are measured at fair value through other comprehensive income, the
loss allowance is charged to profit or loss and recognized in other comprehensive income.

Debt write-off
The total gross book value of a financial asset is written off when the company has no
reasonable expectations of recovering all or part of the financial asset. For individual clients,
the Company has a policy of writing off the gross book value when the financial asset is more
than two years due based on previous experience in recovering similar assets. For corporate
clients, the Company makes an assessment on its own as to the timing and amount of write-
offs based on whether there is a reasonable expectation of recovery. The Company does not
expect any significant recovery from the amount written off. However, financial assets that
have been written off may still be subject to compliance activities in order to comply with the
Company's procedures for recovery of amounts owed.

32-13 Provisions
Provisions are valued at the present value of expected future cash flows discounted at a
before tax discount rate that reflects current market assessments of the time value of money
and the risks specific to the liability. An increase in the carrying amount of a provision
resulting from the use of discounting to create a present value that reflects the passage of
time is recognized as a borrowing cost

51
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
32-14 Cash and cash equivalents
Cash and cash equivalents include cash balances and time deposits. For the purposes of
preparing the statement of cash flows, cash and cash equivalents are defined as cash
balances in the fund, current accounts with banks, term deposits, and treasury bills, which
do not exceed three months. Overdraft bank balance, which is paid upon request, is
considered part From the company’s management of cash

32-15 Dividends
Dividends are recognized as a liability in the period in which the dividends are announced.
The Value of provisions is determined as the present value of expected future cashflows
discounted at pretax discount rate that reflects current market assessment of the time value
of money and risks specified to the liability . The increase in the carrying value of the
provision resulting from the use of discounting to find present value , which reflects the
passage of time is recognized as a borrowing cost.

32-16 Loans
Borrowings are initially recognized at fair value, net of transaction costs incurred. They are
subsequently measured at amortized cost, with any difference between the proceeds (net of
transaction costs) and recoverable value recognized in profit or loss over the life of the loans
using the effective interest method.

32-17 Borrowing cost

Borrowing costs related to the acquisition ,construction or production of a qualifying asset ,
which require a long period of time to prepare it for use for its intended purposes or for sale
, are capitalized as part of the cash of the asset . other borrowing costs are charged as an
expense in the year in which they are incurred. Borrowing costs are represented by interest
costs and other costs that the company spends to borrow money.

32-18 Investments in subsidiaries

Subsidiary companies are the entities in which the “Company” investor has the ability to
control its financial and operating policies of the entity this ability exists by possessing half
of the voting power or more in the related subsidiary.
Investments in subsidiaries are stated – when acquired – at its acquisition cost. If a decline
in the recoverable amount exists for any investment below the carrying amount
“Impairment”, the carrying amount of the investment will be adjusted by the amount of
such impairment and will be charged to the statement of profit or loss for each investment.

32-19 Basic share in profit or loss

The company offers basic share price for its common stock. Basic share per share is
calculated by dividing the profit and loss related to the shareholders for their contribution
to the company's ordinary shares by the weighted average number of ordinary shares
outstanding during the period.

32-20 Statement of cash flows

The statement of separate cash flows is prepared according to the indirect method.

52
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
32-21 Lease contracts
1- Determine whether the arrangement contains a rental contract or not
At the inception of the arrangement, the company determines whether the arrangement is or
contains a lease.
At inception or on reassessment of an arrangement containing a lease, the Company separates the
payments and other consideration required by the arrangement into those of the lease and those
of other components on the basis of their relative fair values.
If the company concludes in a finance lease that it is not possible to reliably separate the
payments, then the asset and liability are recognized at an amount equal to the fair value of the
underlying asset; After that, the obligation is reduced when the payments are made, and the
financing cost is recognized, calculated on the obligation, using the company's incremental
borrowing rate.

2- Leased assets
Leases of property, plant and equipment that transfer substantially all the risks and rewards of
ownership to the Company are classified as finance leases. Leased assets are initially measured
at an amount equal to the lower of the fair value of the fair value and the present value of the
minimum lease payments. After initial recognition, the assets are accounted for in accordance
with the accounting policy applicable to that asset.
Assets held under other leases are classified as operating leases and are not recognized in the
company's statement of financial position.
3- Lease payments
Payments made under operating leases are recognized in profit or loss on a straight-line basis
over the lease term. Lease incentives received are recognized as an integral part of the total lease
expense, over the term of the lease.
Minimum lease payments made under finance leases are apportioned between finance charges
and reduction of outstanding obligations. Finance expenses are charged for each lease period to
reach a constant periodic rate of interest on the remaining balance of the liability.

33. Merger of Lecico Egypt (Egyptian Joint Stock Company)

According to the minutes of the Board of Directors meeting of Lecico Egypt (the holding
company) held on September 17, 2024, approval was granted for the decision of the committee
formed by the General Authority for Investment and Free Zones, which was approved on July
24, 2024. This decision grants permission for the merger of Lecico Egypt (Egyptian Joint Stock
Company) (the merging company) with Lecico Ceramic Industries (Egyptian Joint Stock
Company) (merged company), International Ceramics Company (Egyptian Joint Stock
Company) (merged company) and European Ceramics Company (Egyptian Joint Stock
Company) (merged company).This merger will be based on the book values according to the
financial statements of the merging company and the merged companies as of December 31,
2022, which were taken as the basis for the merger. The net equity of Lecico Egypt (the merging
company) as of December 31, 2022, is set at EGP 222,718,920.
The net equity for the merged companies is Lecico Ceramic Industries (merged company) with
amount of EGP 34,470 and International Ceramics Company (merged company) with amount
EGP 29,720 and European Ceramics Company (merged company) with amount EGP 14,120.
53
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025

On October 29, 2024, the Financial Regulatory Authority (FRA) approved the publication of the
disclosure report, and procedures are being taken to invite an Extraordinary General Meeting
(EGM) for Lecico Egypt (the merging company) to decide on the merger of Lecico Ceramic
Industries (merged company), International Ceramics Company (merged company), and
European Ceramics Company (merged company) into Lecico Egypt (merging company). This
will also involve the transfer of all the rights and obligations of the merged companies to the
merging company in connection with the merger, based on the book values of the net equity of
the merging and merged companies as shown in the financial statements as of December 31,
2022, which were the basis for the merger according to the valuation committee's report.
Furthermore, the merging company will replace the merged companies with all their rights and
obligations legally, as the successor of those companies. The authorized capital after the merger
will be EGP 200,000,000 (Two Hundred Million Egyptian Pounds), which is the sum of the net
equity of the merging company and the merged companies, after allocating EGP 22,797,230 to
be transferred to the reserves in the merging company.
Additionally, the nominal value of the share after the merger will be changed to EGP 2.5 (Two
Egyptian Pounds and Fifty Piastres) instead of EGP 5.0 (Five Egyptian Pounds).

"On June 17, 2025, the Extraordinary General Assembly Meeting of Lecico Egypt (the merging
company) approved the decision to merge Lecico Ceramic Industries (merged), and Lecico
International Ceramics Company (merged), and European ceramics company (merged), into
Lecico Egypt (the merging company). This includes the transfer of all rights and obligations of
the merged companies to the merging company in according the merger , based on the book
value of the net equity of the merging and merged companies as shown in the financial
statements as of December 31, 2022, which were the basis for the merger according to the
valuation committee's report."

34. Important events

The Monetary Policy Committee of the Central Bank of Egypt decided, in its meeting on
Thursday, April 17, 2025, to reduce key interest rates by 225 basis points, bringing the overnight
deposit and lending rates to 25% and 26%, respectively. It also decided to reduce the credit and
discount rates by 225 basis points, bringing them to 25.5%.

On May 25, 2025, the flat interest rate were reduced by 100 basis point bringing the over night
deposit and lending rate to 24% and 25% respectively.

54
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
35. New Editions and Amendments to Egyptian Accounting Standards:
On 3 March 2024, another decision was issued by the Prime Minister No. (636) of 2024 amending some
other provisions of the Egyptian accounting standards,

On October 23, 2024, the Prime Minister issued Decision No. 3527 of 2024, which introduces and adds
the new Egyptian Accounting Standard No. (51) titled "Financial Statements in Hyperinflationary
Economies."

New or reissued Summary of the most Potential impact on Effective date

standards significant the financial
amendments statements
The new Egyptian The impact on the This standard must be A decision will be issued by the Prime Minister
Accounting financial statements applied to financial or an authorized representative to specify the
Standard No. (51) has not yet been statements, including start and end dates for the financial period(s)
"Financial determined until the consolidated financial during which this standard must be applied
Statements in application date is statements for any when the functional currency is the local
Hyperinflationary specified. entity whose functional currency, taking into account the following:
Economies." currency is in an
economy classified as (a) This standard must be applied to the
hyperinflationary. financial statements of the entity starting from
The Egyptian economy the beginning of the financial period in which
has not been declared a This standard applies to the economy is classified as hyperinflationary.
hyperinflationary financial statements,
economy and therefore including independent Comparative figures presented in the financial
the standard is not yet and individual financial statements must be adjusted in accordance with
applied. statements for any the requirements of this standard.
entity whose functional
currency is in an (b) As an exception to the requirements of
economy classified as paragraph 39 of Egyptian Accounting Standard
hyperinflationary. No. 1, personal estimates may be used when
applying this standard for accounting for
It also applies to any foreign operations, such as branches,
group that has foreign subsidiaries, sister companies, or joint
operations, including ventures, to determine whether the economy is
branches, subsidiaries, hyperinflationary.
sister companies,

joint ventures, or others (c) This standard must be applied to all entities
in an economy whose functional currency is the currency in
classified as which the economy has been classified as
hyperinflationary. hyperinflationary.

The impact on financial statements has not yet

been determined until the application date is
specified.

This standard requires This standard must be applied to the financial

55
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
the adjustment of statements, including consolidated financial
financial statements statements for any entity whose functional
prepared in the currency is in an economy classified as
currency of a hyperinflationary.
hyperinflationary
economy,

aiming to provide
useful information
about the financial
position of the entity,
its performance, and
changes in its financial
position for a wide
range of users to make
economic decisions
based on a fair
presentation of the
financial statements.

Accounting Carbon Credits Certificates: Are financial The management is The application starts on or after
instruments subject to trading that represent currently studying the
Interpretation the first of January 2025, early
units for reducing greenhouse gas financial implications of
No. (2) emissions. Each unit represents one ton of adaption is allowed.
applying the accounting
"Carbon equivalent carbon dioxide emissions, and
interpretation to the
Reduction are issued in favor of the reduction project
developer (owner/non-owner), after Company's financial
Certificates" statements.
approval and verification in accordance
with internationally recognized standards
and methodologies for reducing carbon
emissions, carried out by verification and
certification bodies, whether local or
international, registered in the list prepared
by the Financial Regulatory Authority
“FRA” for this purpose. Companies can
use Carbon Credits Certificates to meet
voluntary emissions reduction targets to
achieve carbon trading or other targets,
which are traded on the Voluntary Carbon
Market “VCM”.

56
 LECICO EGYPT (S.A.E.)
Notes to the Separate interim Financial Statements for the period Ended 30 June 2025
New or Summary of the most significant Impact on the financial Effective date
reissued amendments statements
standards

Egyptian 1-This standard determines the The management Egyptian Accounting Standard
Accounting principles of recognition of insurance assessed the new No. (50) is effective for annual
Standard No. contracts falling within the scope of amendments and financial periods starting on or
(50) this standard, and determines their conducted that there after July 1, 2024, and at
“Insurance measurement, presentation, and would be no expected amended until 1st of January
Contracts". disclosure. The objective of the impact in the financial 2025 and if the Egyptian
standard is to ensure that the Company statements. Accounting Standard No. (50)
provides appropriate information that shall be applied for an earlier
truthfully reflects those contracts. This period, the Company should
information provides users of financial disclose that fact.
statements with the basis for assessing
the impact of insurance contracts on
the Company’s financial position,
financial performance, and cash flows.
2-Egyptian Accounting Standard No.
(50) replaces and cancels Egyptian
Accounting Standard No. 37
"Insurance Contracts".
Any reference to Egyptian Accounting
Standard No. (37) in other Egyptian
Accounting Standards to be replaced
by Egyptian Accounting Standard No.
(50).

3-The following Egyptian Accounting

Standards have been amended to
comply with the requirements of the
application of Egyptian Accounting
Standard No. (50) "Insurance
Contracts", as follows:
- Egyptian Accounting Standard No.
(10) "Fixed Assets ".
- Egyptian Accounting Standard No.
(23) "Intangible Assets".
- Egyptian Accounting Standard No.
(34) " Investment property ".

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