As detailed in Note 3 to the consolidated financial statements, the consolidated financial statements of the Group includes the financial statements of Masader Agricultural Feed Mill Ltd. Company, “Subsidiary Company ", in which the statutory procedures to transfer ownership of assets and all operation activities to the Company, in accordance with the signed agreement between the establishment owner (one of the shareholders) and the Company, have not been completed and our opinion is not modified in respect of this matter, which total assets of Masader Agricultural Feed Mill Ltd. Company included in these consolidated financial statements amount to SAR 21.7 million (2022: SAR 26.2 million), and total liabilities amounted to SAR 22.8 million (2022: SAR 24.4 million), revenues amounted to SAR 0.1 million (2022: SAR 1.5 million), and the total expenses amounted to SAR 5 million (2022: SAR 16.1 million).

We would like to further draw attention to Note No. (32) on the consolidated financial statements, which indicates that the total accumulated losses of the group amounted to SAR 63,184,610 , representing 16.1% of the capital (2022: SAR 163,094,500 , representing 41.6% of the capital) , and current liabilities exceeded the group current assets, which led to a deficit in working capital in amounted to SAR 80,890,978. The group also have negative cash flow from operating activities of SAR 13,830,429 (2022: SAR 17,568,214). However, the group relies mainly on the successful implementation of the group's budget plans to generate cash flows sufficient to enable it to fulfil its obligations when they fall due and to continue its operations without significant deficit. The group's management believes that the consolidated financial statements of the group have been prepared on the basis of going concern and the absence of impairment in the value of assets. These matters, along with other matters described in Note No. (32), indicate the existence of material uncertainties and impairments in the value of assets, which may indicate that there is significant doubt about the Group's ability to continue as a going concern. Our opinion has not been modified in respect of this matter.

Basic and diluted earnings per share are calculated by dividing the profit attributable to the group’s shareholders by the weighted average number of shares during the year.

The weighted average number of ordinary shares used as a denominator in calculating basic and diluted earnings per share amounted to 39,176,700 shares, and basic and diluted earnings per ordinary share from continuing operations amounted to 2.07 riyals, compared to a loss per share of (1.37) from the previous comparative year.

Subsequent events

On Thursday, March 7, 2024 AD, the official currency of the country in which the associate company operates, “Rakhaa Agricultural Investment and Development Company” was reduced, which led to a reduction in the official currency of that country against the Saudi riyal by 55% from the levels applied in December 31, 2023 AD, which may affect the value of the investment in that company in the subsequent period compared to the date of the consolidated financial statements as follows:

The investment balance as of December 31, 2023 amounted to 12,112,966 Saudi riyals.

The investment balance as of March 7, 2024 amounted to 5,438,910 Saudi riyals.

The effect of the change in the exchange rate is a loss amounted to (6,674,056) Saudi riyals.

The value of the accumulated losses as on 31 / 12 / 2023 AD amounted to 63.2 million Saudi riyals, which is equivalent to 16.1% of the company's capital of 391.767 million Saudi riyals, and the date of attaining these losses was 31 / 12 / 2023 AD, where the main reasons for these losses are the impairment of properties & equipment related to subsidiary, Increase in provision of expected credit losses for a governmental grants from ministry of finance related to a subsidiary, charging cost of issuing for shareholders equity instruments to retained losses, increase in cost of sales, increase in general & administrative expenses and increase in selling & distribution expenses.