| Nakshbandi
Industries Limited |
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| Annual Report 1995 |
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| BOARD OF DIRECTORS |
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| A. GHAFFAR HAJI SATTAR Chairman |
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| AMANULLAH HAJI LATIF |
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| HAMID HAJI LATIF |
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| SIRAJUDDIN KHAN (NIT) |
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| JUNAID HAJI LATIF |
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| MOHAMMED ASIF A. GHAFFAR |
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| A RAZAK HAJI SATTAR Chief Executive |
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| CHIEF ACCOUNTANT |
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| AND COMPANY SECRETARY |
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| RAUF DAWOOD |
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| BANKERS |
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| HABIB BANK LIMITED |
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| BANK AL-HABIB LIMITED |
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| AUDITORS |
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| HYDER BHIMJI & COMPANY |
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| Chartered Accountants |
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| REGISTERED OFFICE |
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| H-23/4-A LANDHI, KARACHI. |
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| MILLS |
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| H-23/4-A, LANDHI, KARACHI |
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| Notice of Meeting |
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| NOTICE
is hereby given that the Twenty Third Annual General Meeting of the
Shareholders of Nakshbandi |
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| Industries
Limited will be held et the Registered Office of the Company at H-23/4A,
Landhi Industrial Area, Karachi |
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| on
Saturday, March 30, 1996 at 11.00 A.M. to transact the following business. |
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| 1. To confirm the minutes of the Twenty
Second Annual General Meeting held on May 25, 1995. |
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| 2. To receive and adopt the Director's
Report and Audited Accounts for the year ended September 30, 1995, and
Auditor's Report thereon. |
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| 3. To approve the payment of dividend @ 7.5%
and other appropriation as recommended by the Board |
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| 4. To elect Seven Directors in accordance
with the provision of Companies Ordinance, 1984, for a period of three years.
The retiring Directors, namely Messrs. A. Ghaffar Haji Sattar, Amanullah
Haji |
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| Latif,
Hamid Haji Latif, Sirajuddin Khan, Junaid Haji Latif, Mohammad Asif A.
Ghaffar and A. Razak Haji Sattar, being eligible, have notified their
intention to offer themselves for re-election as Directors |
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| 5. To appoint Auditors and fix their
remuneration. |
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| 6. To approve the remuneration of Chief
Executive and other working Director of the Company. |
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| 7. To transact any other ordinary business
as may be placed before the meeting with the permission of the Chairman |
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| By order of the Board |
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| RAUF DAWOOD |
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| Karachi:
March 4, 1996 Company Secretary |
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| NOTES: |
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| 1. The Shares Transfer Book of the Company
will remain closed from March 30,1996 to April 4,1996 |
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| (both days inclusive). |
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| 2. A member entitled to vote at any meeting
may appoint a proxy. Proxies in order to be effective, must |
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| be received at the Registered
Office of the Company duly stamped and signed not later than 48 |
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| hours before the meeting. |
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| 3. A proxy must be a member of the Company. |
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| 4. Shareholders are requested to
immediately notify the change in address. |
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| Directors' Report |
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| Your
Directors have pleasure in presenting to you the Twenty Third Annual Report
alongwith the audited accounts of the Company for the year ended September
30, 1995. |
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| The
Financial result of the Company for the year under report are: |
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Rupees |
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| Profit after taxation |
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3,624,653 |
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| Add:
Un-appropriated profit brought forward |
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187,305 |
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| Amount available for
appropriation |
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3,811,958 |
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| Appropriation: |
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| Proposed Dividend |
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3,404,115 |
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| Un-appropriated profit carried
forward |
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407,843 |
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| By
the Grace of Almighty Allah, your Directors are pleased to recommend dividend
@ 7.5% that is Rs 0.75% per share inspite of reduction in profit after
taxation and decrease in earning per share from Rs. 3.16 to Rs. 0.7985. |
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| During
the year under review the sales of the company decreased by 1.44% from Rs.
454 Million to Rs.447 Million. Sales also reduced in terms of quantity.
Management efforts were concentrated to achieve |
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| minimum
economic price level on its orders but eventually it resulted in reduction of
volume and increase in cost of production. The year under review has been
worst, Company has faced in its past history. There has |
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| been
continuous liquidity problem and increase in working capital requirement due
to increase in all costs of inputs. This was further aggravated by duty
drawback being held-up due to various reasons for which Company |
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| had
to arrange additional borrowings and suffer the cost. This consequently
resulted in reduction of net profit from Rs. 13,033,460 to Rs. 3,624,653. |
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| Inspite
of good cotton crop, prospects for the current year are not encouraging as
the raw material prices |
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| have
not yet dropped to the acceptable level keeping the working capital cost
high. Even devaluation of the |
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| currency
is not helping in increasing the export but having an adverse effect creating
more inflation and |
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| increase in cost of
production. |
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| Inspite
of all Government efforts and recommendations, general export conditions are
not improving for |
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| value
added products. More primary products such as raw cotton, grey cotton yarn
and grey fabric are being |
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| exported. |
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| The
Company has to diversify its products and market and may also change its
ratio of export and |
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| domestic
sales to achieve better profitability levels. Further to strengthen the
Fabric Processing Department, |
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| the
Company has imported open-width Bleaching Machinery, which has already been
installed and commis |
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| sioned.
Presently the Company is planning to import Mercerizing Machine. Also in
Towel Division, 5 (Five) more |
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| Air
Jet Looms with Electronic Dobby / Jacquard are being imported for more
diversification of its products. |
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| In
accordance with the provisions of the Companies Ordinance 1984, all the
existing Directors of the |
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| Company
retire and being eligible, offer themselves for re-election. |
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| The
present auditors Messrs. Hyder Bhin ii & Co. Chartered Accountants retire
and being |
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| eligible for re-appointment. |
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| The pattern of shareholding is
annexed. |
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| The
Directors wish to express their appreciation for the loyalty and devotion to
duty of the workers and |
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| Staff members. |
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| Karachi: March 4,1996 |
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| For and on behalf of the Board |
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| A. GHAFFAR HAJI SATTAR |
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| Chairman |
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| Auditors' Report to the
members |
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| We
have audited the annexed Balance Sheet of NAKSHBANDI INDUSTRIES LIMITED, as
at September |
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| 30,
1995 and the related Profit and Loss Account and Statement of Changes in
Financial Position, (cash flow |
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| statement)
together with the notes forming part thereof, for the year then ended and we
state that we have |
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| obtained
all the information and explanations which to the best of our knowledge and
belief were necessary for |
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purposes of our audit and, after due verification thereof, we report that: |
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| (a)
in our opinion, proper books of account have been kept by the Company as
required by the Companies Ordinance, 1984. |
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| (b) in our opinion: |
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| 1. the Balance Sheet and Profit and Loss
Account together with the notes thereon have been drawn up in conformity with
the Companies Ordinance, 1984 and are in agreement with the |
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| books
of account and are further in accordance with accounting policies
consistently applied; |
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| 2. the expenditure incurred during the
year was for the purpose of the Company's business; and |
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| 3. the business conducted, investment
made and the expenditure incurred during the year were in accordance with the
objects of the Company; |
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| (c)
in our opinion and to the best of our information and according to the
explanations given to us, the |
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| Balance
Sheet, Profit and Loss Account and Statement of Changes in Financial
Position, (cash flow |
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| statement)
together with the notes forming part thereof, give the information required
by the |
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| Companies
Ordinance, 1984 in the manner so required and respectively give a true and
fair view |
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| of
the state of the Company's affairs as at September 30, 1995 and of the Profit
and Changes in |
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| Fjnancial
Position (cash flow position) for the year then ended; and |
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| (d)
in our opinion, Zakat deductible at source under the Zakat and Ushr
Ordinance, 1980, was deducted by the Company and deposited in the Central
Zakat Fund established under section 7 of that Ordinance |
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| HYDER BHIMJI & CO |
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| Chartered Accountants |
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| Karachi: March 4. 1996. |
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| Balance Sheet as at SEPTEMBER
30th 1995 |
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1,995 |
1,994 |
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Notes |
Rupees |
Rupees |
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| CAPITAL AND LIABILITIES |
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| CAPITAL AND RESERVES |
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| Share Capital |
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3 |
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| Authorised |
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3 |
100,000,000 |
100,000,000 |
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| Issued, subscribed and paid-up |
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3 |
45,388,200 |
41,262,000 |
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| REVENUE RESERVES |
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| Reserve |
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4 |
84,951,440 |
84,951,440 |
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| Reserve for Bonus Shares |
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- |
4,126,200 |
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| Un-appropriated profit |
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407,843 |
187,305 |
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130,747,483 |
130,526,945 |
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| Right shares subscription. |
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4 |
3,259,000 |
16,985,050 |
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| REDEEMABLE CAPITAL |
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5 |
32,500,000 |
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| LONG TERM LOANS - (Secured) |
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6 |
25,407,052 |
54,803,921 |
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| DEFERRED LIABILITIES |
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| Gratuity |
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100,889,141 |
9,692,046 |
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| Deferred taxation |
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83,156,141 |
110,615,614 |
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18,404,528 |
20,307,660 |
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| CURRENT LIABILITIES AND
PROVISIONS |
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| Short term running finance
(secured) |
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7 |
192,097,079 |
136,505,062 |
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| Current maturity of long term
loans |
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| and Redeemable Capital |
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8 |
36,896,873 |
25,372,859 |
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| Creditors and accrued
liabilities |
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9 |
47,032,521 |
26,191,946 |
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| Workers participation fund |
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10 |
735,094 |
1,425,781 |
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| Other liabilities |
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11 |
615,997 |
633,041 |
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| Provision for taxation |
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5,000,000 |
5,100,000 |
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| Proposed dividend |
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34,040,115 |
2,063,100 |
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285,781,679 |
197,291,789 |
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| CONTINGENT LIABILITIES AND
COMMITMENTS |
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12 |
- |
- |
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496,099,742 |
419,915,365 |
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========== |
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| PROPERTY AND ASSETS |
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| TANGIBLE FIXED ASSETS |
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| At
cost less depreciation as Per schedule attached |
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212,255,140 |
222,690,285 |
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| CAPITAL WORK - IN - PROGRESS |
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13 |
42,172,463 |
- |
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| LONG TERM DEPOSITS |
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14 |
112,280 |
112,280 |
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| CURRENT ASSETS |
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| Stores and spares |
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15 |
10,894,260 |
16,540,099 |
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| Stock-in-trade |
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16 |
150,786,186 |
95,979,355 |
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| Trade Debts |
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17 |
30,516,739 |
49,393,180 |
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| Advances, deposits,
prepayments |
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| and other receivables |
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18 |
48,739,760 |
30,574,995 |
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| Cash and bank balances |
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19 |
622,914 |
4,625,171 |
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241,559,859 |
197,112,800 |
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496,099,742 |
419,915,365 |
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| Note:
The annexed notes form an integral part of these accounts. |
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| A. RAZAK HA. SATTAR |
Chief Executive |
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| MOHAMMED ASIF ABDUL GHAFFAR |
Director |
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| Karachi: March 4, 1995 |
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| Profit
and Loss Account for the year ended September 30, 1995 |
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1,995 |
1,994 |
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Notes |
Rupees |
Rupees |
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| SALES |
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20 |
447,846,516 |
454,374,759 |
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| Cost of Sales |
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21 |
381,183,839 |
373,358,782 |
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66,662,677 |
81,015,977 |
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| GROSS PROFIT |
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| Administrative expenses |
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22 |
12,632,764 |
12,060,875 |
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| Selling expenses |
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23 |
18,257,481 |
21,654,917 |
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30,890,245 |
33,715,791 |
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| OPERATING PROFIT |
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35,772,432 |
47,300 |
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| other income |
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24 |
196,956 |
193,991 |
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35,969,388 |
47,494,176 |
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| Financial expenses |
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25 |
31,772,945 |
29,274,744 |
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| Worker's welfare fund |
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160,000 |
400,000 |
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| Worker's participation fund |
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211,790 |
910,972 |
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32,144,735 |
30,585,716 |
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| PROFIT BEFORE TAXATION |
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27 |
3,824,653 |
16,908,460 |
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| Provision for taxation |
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200,000 |
3,875,000 |
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| PROFIT AFTER TAXATION |
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3,624,653 |
13,033,460 |
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| UNAPPROPRIATED PROFIT BROUGHT
FORWARD |
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187,305 |
343,145 |
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| Amount available for
appropriation |
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3,811,958 |
13,376,605 |
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| APPROPRIATIONS |
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| Proposed dividend @ 7.5%
(1994: @ 5%) |
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3,404,115 |
2,063,100 |
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| Reserve for bonus shares |
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_ |
4,126,200 |
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| General reserve |
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_ |
7,000,000 |
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3,404,115 |
13,189,300 |
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------------ |
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407,843 |
187,305 |
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| UNAPPROPRIATED PROFIT CARRIED
FORWARD |
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========== |
========== |
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| Note:
The annexed notes form an integral part of these accounts. |
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| A. RAZAK HAJI SATTAR |
Chief Executive |
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| MOHAMMED ASIF Al ,DUL GHAFFAR |
Director |
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| Karachi: March 4, 1996 |
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| Schedule
of tangible fixed assets as at September 30, 1995 |
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C O S T |
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Annual |
Depreciation |
Accumulated |
Net Book |
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As on |
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Disposal |
As at |
rate of |
for the |
Depreciation |
Value |
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| Particulars |
|
October 1 |
Additions |
and |
September 30, |
Depreciation % |
year |
upto |
as at |
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|
1994 |
|
Adjustment |
1,995 |
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30-09-1995 |
30-09-1995 |
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| Leasehold land |
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250,000 |
- |
- |
250,000 |
- |
- |
- |
250,000 |
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| Leasehold land Office |
|
1,500,000 |
- |
- |
1,500,000 |
- |
- |
- |
1,500,000 |
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| Building on |
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| leasehold land |
|
65,208,641 |
957,079 |
- |
66,165,720 |
0 |
3,405,143 |
35,519,438 |
30,646,283 |
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| Building office |
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| on leasehold land |
|
3,280,075 |
2,588,904 |
- |
5,868,979 |
0 |
554,097 |
882,105 |
4,986,874 |
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| Plant & Machinery |
|
306,655,127 |
19,137,802 |
11,603,592 |
314,189,337 |
0 |
18,429,560 |
148,323,296 |
########### |
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| Electric fittings |
|
2,991,747 |
- |
- |
2,991,747 |
0 |
158,917 |
1,561,491 |
1,430,256 |
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| Office equipments |
|
4,691,955 |
1,300,601 |
23,500 |
5,969,056 |
0 |
585,974 |
2,648,538 |
3,320,518 |
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| Furniture & Fixtures |
|
1,698,253 |
358,044 |
- |
2,056,297 |
0 |
150,681 |
700,168 |
1,356,129 |
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| Vehicle |
|
4,252,344 |
904,600 |
114,300 |
5,042,644 |
0 |
724,760 |
2,143,605 |
2,899,039 |
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| Total Rupees: 1995 |
|
390,528,142 |
25,247,030 |
11,741,392 |
404,033,780 |
|
24,009,132 |
191,778,641 |
########### |
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| Total Rupees: 1994 |
|
375,688,756 |
49,920,386 |
35,081,000 |
390,528,142 |
|
25,106,325 |
167,837,857 |
########### |
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| Depreciation
charge for the year has been allocated as under: |
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|
1,995 |
1,994 |
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|
Rupees |
Rupees |
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| Cost of goods manufactured |
|
23,272,477 |
24,517,257 |
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| Administrative expenses |
|
736,655 |
589,068 |
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|
------------ |
------------ |
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|
24,009,132 |
25,106,325 |
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========== |
========== |
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| Statement
of Changes in Financial Position (Cash Flow Statement) for the year ended
September 30, 1995 |
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|
|
|
1,995 |
1,994 |
|
|
|
Rupees |
Rupees |
|
|
|
|
|
| CASH FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
|
| Profit before taxation |
|
3,824,653 |
16,908,460 |
|
| Adjustment For: |
|
------------ |
------------ |
|
| Depreciation |
|
24,009,132 |
25,106,325 |
|
| Financial Charges |
|
31,772,945 |
29,274,744 |
|
| Gratuity |
|
396,868 |
11,518 |
|
| Loss/(Profit) on sales of fixed
assets |
|
(196,956) |
(193,991) |
|
|
|
------------ |
------------ |
|
| Cash generated from operations
before |
|
59,806,642 |
71,107,056 |
|
| working capital changes |
|
|
|
|
|
|
|
| Changes in working Capital |
|
|
|
| Increase/(Decrease) in current
assets |
|
------------ |
------------ |
|
| Stores and spares |
|
(5,645,838) |
(2,210,247) |
|
| Stock-in-trade |
|
54,806,832 |
(25,271,645) |
|
| Sundry debtors |
|
(18,876,441) |
(2,695,351) |
|
| Advances, deposits, prepayments and
receivables |
396,868 |
2,799,962 |
|
|
------------ |
------------ |
|
|
(48,449,318) |
(27,377,281) |
|
| Increased
in Creditors, accrued and other liabilities |
|
28,081,562 |
(4,646,031) |
|
|
------------ |
------------ |
|
| Cash
generated from operating activities |
|
31,438,886 |
39,083,744 |
|
|
|
|
|
|
|
|
| Cash (out flow)/inflow from
operations |
|
|
|
| Financial charges paid |
|
(31,772,945) |
(29,274,744) |
|
| Payment of Income tax |
|
(2,600,000) |
(3,800,000) |
|
