| MOONLITE (PAK) LTD |
|
|
|
|
|
|
|
|
|
| 26TH
ANNUAL REPORT 1995-96 |
|
|
|
| CONTENTS |
|
| COMPANY
INFORMATION |
|
|
|
| NOTICE
OF MEETING |
|
|
|
| DIRECTORS'
REPORT |
|
|
|
| AUDITORS'
REPORT |
|
|
|
| BALANCE
SHEET |
|
|
|
| PROFIT
& LOSS ACCOUNT |
|
|
|
| CASH
FLOW STATEMENT |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
|
|
| PATTERN
OF SHARE HOLDING |
|
|
|
|
| COMPANY
INFORMATION |
|
| BOARD
OF DIRECTORS |
|
| TAR
H. ISMAlL |
(Chairman & Chief
Executive) |
|
| ABDUL
AZIZ T. ISMAlL |
|
| ASHRAF
T. ISMAlL |
|
| M.
SOHAIL UMER |
|
| SHAHID
UMER |
|
| ZUBEDA
TAR MUHAMMAD |
|
| AQUIL
AHMED KHAN |
(N.I.T. Nominee) |
|
|
| AUDITORS |
|
|
| RAHIM
IQBAL RAFIQ & CO. |
|
| Chartered
Accountants |
|
| BANKERS |
|
|
| MUSLIM
COMMERCIAL BANK LIMITED |
|
| BANK
AL- HABIB LIMITED |
|
| UNITED
BANK LIMITED |
|
| REGISTERED |
|
|
| F-120,
Hub River Road, |
|
| OFFICE
& MILLS |
|
| S.I.T.E.
Karachi - 75730 |
|
|
|
| NOTICE
OF MEETING |
|
| Notice
is hereby given that the 26th Annual General Meeting of the Shareholders of |
|
| MOONLITE
(PAK) LIMITED, will be held at Registered office of the company F-120, |
|
| Hub
River Road, S.I.T.E., Karachi-75730, on Wednesday December 18, 1996 at 12.00 |
|
| noon
to transact the following business: |
|
| 1.
To confirm the minutes of 25th Annual General Meeting held on November 23,
1995. |
|
| 2.
To receive and adopt the directors report and audited accounts of the Company |
|
| for
the year ended June 30, 1996. |
|
| 3.
To appoint Auditors and fix their remuneration. |
|
| 5.
To transact any other business with the permission of the Chairman. |
|
|
|
|
|
By Order of the Board |
|
|
|
TAR H. ISMAlL |
|
| Karachi:
November 13, 1996. |
CHAIRMAN & CHIEF
EXECUTIVE |
|
|
|
| NOTES: |
|
| 1.
The share transfer books of the Company will be closed from December 11, 1996 |
|
| to
December 18, 1996 (both days inclusive). |
|
|
|
|
| 2.
A member of the Company entitled to attend and vote at meeting may appoint |
|
| a
proxy and vote for him/her. A proxy must be a member of the Company and |
|
| in
order to be effective must be received by the Company not less than 48 hours |
|
| before
the time of holding the meeting. |
|
|
|
|
|
| DIRECTORS'
REPORT |
|
| Your
Directors present before you 27th Annual Report together with the |
|
| Audited
Accounts for the year ended June 30, 1996. |
|
|
| 1.
FINANCIAL RESULTS: |
|
|
|
RUPEES |
|
| Profit
Before Taxation |
|
|
|
1,056,771 |
|
| Deduct
Taxation: |
|
|
| Current |
|
|
|
(1,631,904) |
|
| Prior
Years |
|
|
|
38,494 |
|
| Deferred |
|
|
|
1,500,000 |
|
|
|
---------- |
|
|
|
|
(93,410) |
|
|
---------- |
|
| Profit
After Taxation |
|
|
963,361 |
|
|
|
|
|
========== |
|
|
|
|
|
|
| 2.
BUSINESS OPERATION: |
|
|
|
|
|
| 2.1
Cost of raw meterial shows constant increase because of price increase |
|
| and
devaluation of Pak Rupees. |
|
|
|
| 2.2
Input costs remained major factor for pushing manufacturing cost upward. |
|
| 2.3
The levy of sales tax and freely import of the Blankets and Carpets has an |
|
| adverse
effect because of stiff competition. However, turnover has increased |
|
| from
Rs. 240 Millions to Rs. 316 Millions. |
|
|
|
| 2.4
Profit margin have declined being unable to keep pace with the daily |
|
| upward
trend in the price indices. |
|
|
|
| 2.5
The deferred tax liability computes to Rs.0.8 million therefore, an amount |
|
| of
Rs. 1.5 million being excess amount lying in the account is accordingly |
|
| written
back. |
|
|
|
|
| 3.
FUTURE OUTLOOK: |
|
| Considering
the existing economic scenario when imports for carpets and blankets |
|
| are
allowed freely and input cost increase constantly it is very difficult to
visualise |
|
| a
healthy outcome. However, the Management is determined to meet the challenge |
|
| by
aggressive marketing to offset the negative affects. |
|
|
| 4.
AUDITORS: |
|
| M/S.
RAHIM IQBAL RAFIQ & CO., Chartered Accountants retire and offer
themselves |
|
| for
reappointment as auditor for the ensuing year. |
|
|
|
|
| 5.
ACKNOWLEDGMENT: |
|
|
| We
wish to record our appreciation for the commitment, dedication and hardwork |
|
| by
our workforce at all levels. The response and confidence of our esteemed
clients |
|
| and
dealers bolstered our role as manufacturer in this stiff competition. MCB
& |
|
| P1CIC
as banker and lender respectively contributed significantly in growth of the |
|
| company. |
|
|
|
On Behalf of Board of
Directors |
|
|
|
TAR H. ISMAIL |
|
| Karachi:
November 12, 1996 |
|
CHAIRMAN & CHIEF
EXECUTIVE |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
| We
have audited the annexed Balance Sheet of MOONLITE (PAK) LIMITED as at |
|
| June
30, 1996 and the related Profit and Loss account and statement of changes |
|
| in
financial position together with the notes forming part thereof, for the year
then |
|
| ended
and we state that we have obtained all the information and explanations |
|
| which
to the best of our knowledge and belief were necessary for the purposes of |
|
| our
audit and, after due verification thereof, we report that: |
|
|
| (a)
in our opinion, proper books of account have been kept by the company |
|
| as
required by the companies Ordinance, 1984; |
|
|
| (b)
In our opinion: |
|
| (i)
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 books of accounts |
|
| and
are further in accordance with accounting policies consistently |
|
| applied; |
|
|
|
|
|
|
| (ii)
the expenditure incurred during the year was for the purpose of the |
|
| company's
business; and |
|
|
|
|
| (iii)
the business conducted, investments made and the expenditure |
|
| incurred
during the year were in accordance with the objects of the |
|
| company; |
|
|
|
|
|
|
| (c)
in our opinion and to the best of our information and according to the |
|
| explanations given to us, the Balance
Sheet, Profit and Loss Account and |
|
| the statement of the changes in Financial
Position, together with the notes |
|
| forming part thereof, give the information
required by the Companies |
|
| Ordinance, 1984 in the manner so required
and respectively give a true |
|
| and fair view of the state of the company's
affairs as at June 30, 1996 |
|
| and of the profit and the changes in
financial position for the year then |
|
| ended; and |
|
|
|
| (d)
in our opinion, "No Zakat was deductible at source under the Zakat and |
|
| Ushr
ordinance, 1980." |
|
|
RAHIM IQBAL RAFIQ &
COMPANY |
|
| Karachi:
November 12, 1997 |
Chartered Accountants |
|
|
|
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1996 |
|
|
|
|
1996 |
1995 |
|
|
NOTE |
RUPEES |
RUPEES |
|
| SHARE
CAPITAL AND RESERVES |
|
| Authorised
Capital |
|
| 4,000,000
Ordinary Shares of Rs. 10/= each |
|
40,000,000 |
40,000,000 |
|
|
========== |
========== |
|
| Issued,
subscribed and paid up capital |
3 |
21,595,860 |
21,595,860 |
|
| Reserves |
|
4 |
1,899,305 |
1,899,305 |
|
| Accumulated
loss |
|
|
(1,844,403) |
(2,807,764) |
|
|
|
---------- |
---------- |
|
|
21,650,762 |
20,687,401 |
|
|
| LONG
TERM LOANS |
|
5 |
25,302,901 |
1,531,901 |
|
|
| LIABILITIES
AGAINST ASSETS |
|
| SUBJECT
TO FINANCE LEASE |
|
6 |
6,842,593 |
8,417,394 |
|
|
|
| DEFERRED
LIABILITIES |
|
| Taxation |
|
|
800,000 |
23,000,000 |
|
| Gratuity |
|
|
13,225,705 |
11,167,876 |
|
|
---------- |
---------- |
|
|
|
|
14,025,705 |
13,467,876 |
|
| CURRENT
LIABILITIES |
|
| Short
term finances |
|
7 |
111,304,267 |
114,542,046 |
|
| Current
portion of long term liabilities |
8 |
8,252,607 |
7,171,487 |
|
| Creditors,
accrued and other liabilities |
9 |
100,795,263 |
68,511,169 |
|
| Taxation |
|
|
|
1,631,904 |
1,232,000 |
|
|
---------- |
---------- |
|
|
|
|
221,984,041 |
191,456,702 |
|
| CONTINGENCY
AND COMMITMENTS |
|
10 |
|
|
|
|
|
---------- |
---------- |
|
|
|
|
289,806,002 |
265,561,274 |
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these financial statements. |
|
|
| FIXED
CAPITAL EXPENDITURE |
|
| Operating
assets |
|
|
62,501,954 |
63,560,531 |
|
| Capital
work-in-progress |
|
|
2,386,544 |
442,000 |
|
|
---------- |
---------- |
|
|
|
64,888,498 |
67,980,531 |
|
|
| LONG
TERM INVESTMENTS |
|
|
13 |
25,000 |
25,000 |
|
| LONG
TERM LOANS |
|
|
14 |
7,051,032 |
5,496,167 |
|
| LONG
TERM DEPOSITS |
|
|
15 |
1,440,530 |
1,323,300 |
|
|
| CURRENT
ASSETS |
|
| Stores,
spares and loose tools |
|
16 |
7,524,435 |
6,169,356 |
|
| Stock-in-trade |
|
17 |
105,061,419 |
126,042,474 |
|
| Trade
debts |
|
18 |
95,296,589 |
46,775,448 |
|
| Loans,
advances, |
|
| deposits,
prepayments |
|
| and
other receivables |
|
19 |
7,735,938 |
11,131,784 |
|
| Cash
and bank balances |
|
20 |
782,561 |
617,214 |
|
|
|
|
---------- |
---------- |
|
|
|
|
216,400,942 |
190,736,276 |
|
|
---------- |
---------- |
|
|
|
289,806,002 |
265,561,274 |
|
|
========== |
========== |
|
|
| PROFIT
AND LOSS ACCOUNT FOR THE YEAR ENDED JUNE 30,1996 |
|
|
|
1996 |
1995 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
|
| Sales |
|
21 |
316,010,523 |
240,220,158 |
|
| Cost
of goods sold |
|
22 |
276,318,081 |
203,403,385 |
|
|
|
|
---------- |
---------- |
|
| Gross
profit |
|
|
39,692,442 |
36,816,773 |
|
| Processing
receipts |
|
23 |
9,379,905 |
5,046,886 |
|
|
|
|
---------- |
---------- |
|
|
|
|
49,072,347 |
41,863,659 |
|
| OPERATING
EXPENSES |
|
|
| Administration
and general |
|
24 |
12,523,431 |
11,612,583 |
|
| Selling
and distribution |
|
25 |
5,443,935 |
4,831,827 |
|
| Financial |
|
26 |
30,055,521 |
25,374,852 |
|
|
|
|
---------- |
---------- |
|
|
|
|
48,022,887 |
41,819,262 |
|
|
|
|
---------- |
---------- |
|
| Operating
profit |
|
|
1,049,460 |
44,397 |
|
| Other
income |
|
27 |
216,035 |
373,062 |
|
|
---------- |
---------- |
|
|
1,265,495 |
417,459 |
|
|
|
| Workers'
profit participation fund |
|
|
63,275 |
20,873 |
|
| Workers'
welfare fund |
|
|
145,449 |
-- |
|
|
---------- |
---------- |
|
|
|
|
208,724 |
20,873 |
|
|
|
|
---------- |
---------- |
|
| Profit
Before Taxation |
|
|
1,056,771 |
396,586 |
|
| Taxation |
|
| Current |
|
28 |
-1,631,904 |
(1,232,000) |
|
| Prior
year's |
|
|
38,494 |
67,726 |
|
| Deferred |
|
|
1,500,000 |
-- |
|
|
---------- |
---------- |
|
|
|
|
(93,410) |
(1,164,274) |
|
|
|
|
---------- |
---------- |
|
| Profit/(Loss)
After' Taxation |
|
963,361 |
(767,688) |
|
| Accumulated
(loss) brought forward |
|
(2,807,764) |
(2,040,076) |
|
|
|
---------- |
---------- |
|
| Accumulated
(loss) carried forward |
|
(1,844,403) |
(2,807,764) |
|
|
|
========== |
========== |
|
| The
annexed notes form an integral part of these financial statements |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 1996 |
|
|
|
|
|
1996 |
1995 |
|
|
|
NOTE |
RUPEES |
RUPEES |
|
|
| CASH
FLOWS FROM OPERATING ACTIVITIES |
|
| Profit
before taxation |
|
|
1,056,771 |
396,586 |
|
|
|
|
|
|
| ADJUSTMENTS
FOR: |
|
|
|
|
| Depreciation |
|
|
7,507,315 |
7,629,243 |
|
| Provision
for Gratuity |
|
|
2,309,133 |
1,770,958 |
|
| Gain
on disposal of fixed assets |
|
(216,035) |
(91,097) |
|
| Gain
on disposal of investment in subsidiary |
|
-- |
(281,965) |
|
| Financial
charges |
|
30,055,521 |
25,374,852 |
|
| Increase
in working capital |
|
31 |
(4,152,019) |
(7,719,563) |
|
|
---------- |
---------- |
|
| Cash
generated from operation |
|
36,560,686 |
27,079,014 |
|
|
|
|
|
| Financial
charges paid |
|
|
(22,673,380) |
(20,907,179) |
|
| Taxes paid |
|
|
|
(1,193,506) |
(1,258,274) |
|
| Gratuity
paid |
|
|
(251,304) |
(816,515) |
|
| Long
term loan employees (net) |
|
|
( 1,554,865) |
(1,837,838) |
|
| Long
term deposits (net) |
|
|
(117,230) |
(996,515) |
|
|
---------- |
---------- |
|
| Net
cash inflow from operating activities |
|
10,770,401 |
1,262,693 |
|
|
|
|
|
|
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
| Fixed
capital expenditure |
|
|
(4,090,947) |
(9,196,089) |
|
| Proceeds
from disposal of fixed assets |
|
384,000 |
10,486,625 |
|
| Proceeds
from disposal of investment in subsidiary |
-- |
333,887 |
|
|
---------- |
---------- |
|
| Net
cash (outflow)/inflow from investing activities |
(3,706,947) |
1,624,423 |
|
|
| CASH
FLOWS FROM FINANCING ACTIVITIES |
|
| Repayment
of long term loans |
|
(5,427,000) |
(2,447,000) |
|
| Payment
of lease liabilities |
|
(1,787,981) |
(729,540) |
|
|
---------- |
---------- |
|
| Net
cash (outflow) from financing activities |
|
(7,214,981 ) |
(3,176,540) |
|
| Net
decrease in cash and cash equivalents |
|
(151,527) |
(289,424) |
|
|
| Cash
and cash equivalents at beginning |
|
| of
the year |
|
|
(9,273,409} |
(8,983,985) |
|
|
---------- |
---------- |
|
| Cash
and cash equivalents at end of |
|
| the year |
|
32 |
(9,424,936) |
(9,273,409) |
|
|
========== |
========== |
|
|
|
| NOTES
TO THE ACCOUNTS FOR THE YEAR ENDED JUNE 30, 1996 |
|
|
| 1.
STATUS AND ACTIVITIES |
|
| Moonlite
(Pak) Limited was incorporated in Pakistan as a public limited company and is
quoted on Karachi Stock Exchange. The |
|
| company
is engaged in the manufacturing of woollen yarn, acrylic blankets, synthetic
tufted carpets and allied cotton and |
|
| synthetic
products. |
|
|
|
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
| 2.1
ACCOUNTING CONVENTION |
|
| These
financial statements have been prepared under the historical cost convention. |
|
|
| 2.2
FOREIGN CURRENCIES |
|
| Liabilities
in foreign currencies in respect of loans not covered under exchange risk
contract, are translated into Pak |
|
| Rupees
at the rate of exchange prevailing at the balance sheet date. The foreign
currencies in respect of loans covered |
|
| under
exchange risk contract are converted at the rate of exchange prevailing on
the date of disbursement. |
|
|
|
|
| 2.3
STAFF RETIREMENT BENEFIT |
|
| The
company operates an unfunded gratuity scheme covering employees eligible to
the benefits. Provision is made |
|
| annually
to cover obligation under the scheme. |
|
|
|
| 2.4
BORROWING COSTS |
|
| Borrowing
costs are recognized as an expense in the year in which they are incurred
except those that are directly |
|
| attributable
to the acquisition of a fixed asset. |
|
| The
capitalization of borrowing costs as part of a fixed asset commences when
expenditure for the asset are being |
|
| incurred;
borrowing costs are being incurred and activity that are necessary to prepare
asset for their intended use |
|
| are
in progress. Capitalization of borrowing costs ceases when substantially all
the activities necessary to prepare the |
|
| asset
for their intended use are complete. |
|
|
|
|
| 2.5
TAXATION |
|
|
| Current |
|
|
| The
charge for current taxation is based on taxable income at the current rate of
taxation after taking into account tax |
|
| credits
and tax rebates available, if any, or 0.5% of turnover whichever is higher. |
|
| Deferred |
|
|
| The
company accounts for deferred taxation using the liability method on all
major timing differences. However, |
|
| deterred
tax is not provided if it is determined with reasonable probability that
these timing differences will not reverse |
|
| in
the foreseeable future. The deferred tax debits are not incorporated in the
financial statements, |
|
|
|
|
| 2.6
FIXED CAPITAL EXPENDITURE |
|
| OPERATING
ASSETS |
|
| These
are stated at cost less accumulated depreciation except lease hold land which
is stated at cost. |
|
| Depreciation
is charged to income applying the reducing balance method at the rates
specified in operating assets note. |
|
| Maintenance
and normal repairs are charged to income as and when incurred. Major renewals
and improvements are |
|
| capitalised
and assets so replaced, if any, are retired. Gain and loss on disposals of
operating |
|
| income
currently. |
|
|
| Additions
to fixed assets are depreciated for full year irrespective of date of
purchase. No depreciation is charged on |
|
| fixed
assets in the year of their disposal. |
|
| CAPITAL
WORK IN PROGRESS |
|
| All
cost/expenditure connected with specific assets incurred during the project
implementation period is carried under |
|
| this
head. These are transferred to specific assets as and when assets are
available for use. |
|
|
|
|
| 2.7
ACCOUNTING FOR LEASE |
|
| The
Company accounts for the assets acquired under finance lease by recording the
assets and related liability. |
|
| Financial
charges are allocated to accounting period in a manner so as to provide a
constant periodic rate of charge |
|
| on
the outstanding liability. Depreciation is charged at the rates specified in
the related note to write off the assets |
|
| over
its estimated useful life in view of the certainty of ownership of the assets
at the end of the lease period. |
|
|
|
|
| 2.8
LONG TERM INVESTMENTS |
|
|
| These
are valued at cost. |
|
|
|
| 2.9
STORES, SPARES AND LOOSE TOOLS |
|
| Stores,
spares and loose tools are valued at average cost. |
|
|
| 2.10
STOCK IN TRADE |
|
| These
are valued at lower of cost and net realizable value Cost is determined by
applying the following basis. |
|
|
| a:
Raw and packing material |
|
: |
at average cost. |
|
| b:
Work-in-process |
|
|
: |
at prime cost. |
|
| c:
Finished stock |
|
: |
at average manufacturing
cost. |
|
| d:
Raw material in bonded ware house |
: |
at actual cost |
|
| e:
Raw material in transit |
|
: |
at actual cost |
|
|
|
|
| 2.11
TRADE DEBTS |
|
|
| Debts
if considered irrecoverable are written off arm provision is made for the
amount considered doubtful. |
|
|
|
|
| 2.12
REVENUE RECOGNITION |
|
| Sales
are recorded on despatch of goods. |
|
| Income
on investments are recorded when received. |
|
| Export
rebate is recorded when received. |
|
|
|
|
1996 |
1995 |
|
|
RUPEES |
RUPEES |
|
| 3.
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL |
|
| 1,234,050
(1995: 1,234,050) ordinary |
|
| shares of Rs. 10/= each
fully paid in cash |
|
12,340,500 |
12,340,500 |
|
| 925,536
(1995: 925,536) ordinary shares of |
|
| Rs.
10/= each issued as fully |
|
| paid
bonus shares |
|
9,255,360 |
9,255,360 |
|
|
---------- |
---------- |
|
|
|
21,595,860 |
21,595,860 |
|
| 4.
RESERVES |
|
| Revenue |
|
1,500,000 |
1,500,000 |
|
| Capital |
|
399,305 |
399,305 |
|
|
---------- |
---------- |
|
|
|
1,899,305 |
1,899,305 |
|
|
|
========== |
========== |
|
| 5.
LONG TERM LOANS - SECURED |
|
| From
Pakistan Industrial Credit and Investment Corporation Limited. |
|
|
|
|
TOTAL |
TOTAL |
|
|
Loan-I |
Loan-II |
Loan-III |
Loan-IV |
1996 |
1995 |
|
| Particulars |
|
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
|
|
|
|
| Opening
balance |
|
16,232,243 |
5,013,015 |
9,935,967 |
5,777,676 |
36,958,901 |
39,405,901 |
|
| Less: |
|
| -- Paid during the year |
2,805,000 |
751,000 |
1,149,000 |
722,000 |
5,427,000 |
2,447,000 |
|
| -- Current portion shown |
|
| under
current liabilities |
3,212,000 |
859,000 |
1,316,000 |
842,000 |
6,229,000 |
5,427,000 |
|
|
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
|
|
6,017,000 |
1,610,000 |
2,465,000 |
1,564,000 |
11,656,000 |
7,874,000 |
|
|
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
|
| Closing
balance |
|
10,215,243 |
3,403,015 |
7,470,967 |
4,213,676 |
25,302,901 |
31,531,901 |
|
|
|
========== |
========== |
========== |
========== |
========== |
========== |
|
| No.
of Instalment |
|
10 |
11 |
13 |
12 |
|
|
|
|
|
Semi |
Semi |
Semi |
Semi |
|
|
|
|
|
Annually |
Annually |
Annually |
Annually |
|
|
|
| Rate of interest |
|
14% |
14% |
14% |
3% |
|
|
|
|
per annum |
per annum |
per annum |
above bank |
|
|
|
|
|
rate |
|
|
|
|
|
|
| First
Instalment |
|
| Paid after |
|
|
