| Al-Abbas Sugar Mills Limited |
|
|
|
|
|
|
|
| Annual Report 1997 |
|
|
|
|
| CONTENTS |
|
| Company
Information |
|
| Notice of Annual General
Meeting |
|
| Directors'
Report |
|
| Pattern of Share Holding |
|
| Auditors'
Report |
|
| Balance
Sheet |
|
| Profit
& Loss Account |
|
| Cash
Flow Statement |
|
| Notes to the Accounts |
|
|
|
|
|
|
|
| COMPANY
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
|
|
| HAJI
ABDUL GHANI |
|
| Chairman |
|
| MR.
SHUNAID QURESHI |
|
| Chief
Executive |
|
| MR.
MUHAMMAD IQBAL USMAN |
|
| MR.
TARIQ USMAN BHATTI |
|
| MR.
MUHAMMAD AYOUB |
|
| MR.
KHALID USMAN BHATTI |
|
| MR.
ABDUL SATTAR RAJA |
|
|
| COMPANY
SECRETARY |
|
| MR.
MUHAMMAD SULEMAN KANJIANI |
|
|
| AUDITORS |
|
| HAROON
ZAKARIA & CO. |
|
| Chartered
Accountants |
|
|
| LEGAL
ADVISOR |
|
| MR.
MUHAMMAD MAZHAR ALl |
|
| Advocate |
|
|
| REGISTERED
OFFICE |
|
| 4th
Floor, P.N.S.C. Building, |
|
| Moulvi
Tamizuddin Khan Road, |
|
| Karachi. |
|
| Tel : 5611895-96 & 5611724 |
|
| Fax
: (92-21) 5610778 |
|
|
| MILL |
|
| Mirwah
Gorchani, |
|
| Distt.
Mirpurkhas. |
|
|
|
| NOTICE
OF THE SEVENTH ANNUAL GENERAL MEETING |
|
|
| NOTICE
is hereby given that the Seventh Annual General Meeting will be held on
Tuesday, the 3rd |
|
| February
1998 at 1500 hours at Raffia Choudri Memorial Centre, Ground Floor, Sidco
Avenue Centre, |
|
| Karachi
to transact the following business: |
|
|
| 1.
to confirm the minutes of the last Annual General Meeting, held on 22nd
March, 1997. |
|
|
| 2.
to receive and adopt the Audited Accounts for the year ended 30th September,
1997 together |
|
| with
the Directors' and Auditors' Reports thereon. |
|
|
| 3.
to appoint Auditors of the Company for the year 1997-98 and to fix their
remuneration. The |
|
| retiring
Auditors Messrs. Haroon Zakaria & Co., Chartered Accountants being
eligible, have |
|
| offered
themselves for re-appointment. |
|
|
| 4.
to transact any other matter with the permission of the Chair. |
|
|
| NOTE: |
|
|
| 1.
The Share Transfer Books of the Company will remain closed and no transfer of
shares will be |
|
| accepted
for registration from 25th January, 1998 to 3rd February, 1998 (both days
inclusive). |
|
|
| 2.
A Member entitled to attend and vote at the General Meeting is entitled to
appoint a proxy to |
|
| attend
and vote on his behalf. Proxies in order to be valid must be received at the
Registered |
|
| Office
of the Company not less than 48 hours before the time of the Meeting. A proxy
must be |
|
| a
member of the Company. |
|
|
| 3.
Share holders are advised to notify the Company of any change in their
address immediately to |
|
| ensure
prompt delivery of mails. |
|
|
|
| DIRECTORS'
REPORT |
|
|
| Dear
Share Holders, |
|
|
| We
feel pleasure in placing before you the annual report and audited accounts
for the year ended |
|
| September
30, 1997. |
|
|
| During
the year under review your company has earned pre-tax profit of Rs.
41,145,768 |
|
| (1996:
Rs: 49,794,411). The appropriation of available profit is recommended as
under: |
|
|
|
1997 |
1996 |
|
|
| Net
Profit before taxation: |
|
|
Rs. 41,145,768 |
Rs. 49,794,411 |
|
| Provision
for taxation: |
|
Rs. 22,830,790 |
Rs. 3,164,336 |
|
|
----------- |
----------- |
|
| Profit
after taxation |
|
Rs. 18,314,978 |
Rs. 46,630,075 |
|
| Un-appropriated
profit brought forward |
|
Rs. 13,081,526 |
Rs. 1,451,451 |
|
|
----------- |
----------- |
|
| Profit
available for appropriation |
|
Rs. 31,396,504 |
Rs. 48,081,526 |
|
|
----------- |
----------- |
|
| Appropriations: |
|
| Transfer
to General Reserve |
|
Rs. 30,000,000 |
Rs. 35,000,000 |
|
|
----------- |
----------- |
|
| Un-appropriated
profit carried forward |
|
.Rs. 1,396,504 |
Rs. 13,081,526 |
|
|
========== |
========== |
|
| OPERATING
RESULTS |
|
|
| During
the crushing season 1996-97 your Company managed to crush 384,875 M/Tons of
sugar- |
|
| cane
whereas last year the total crushing was 401,058 M/Tons, however due to
higher recovery i.¢. |
|
| 10.70~/~
(1996: 10.00~/~) the production has increased from 39~977 M/Tons to 41,284
M/Tons. |
|
| Comparative
figures of crushing and production are given below: |
|
|
|
1996-97 |
1995-96 |
|
|
|
|
| Season
Started on |
|
08-11-96 |
16-10-95 |
|
| Season
Closed on |
|
31-03-97 |
14-03-96 |
|
| Days worked |
|
144 |
151 |
|
| Cane
Crushed (Tons) |
|
384,875 |
401,058 |
|
| Sugar
Recovery (%) |
|
10.70 |
10.00 |
|
| Sugar
Production (Tons) |
|
41,284 |
39,977 |
|
|
|
|
| FUTURE
OUT LOOK |
|
|
| Your
Mill has started crushing season 1997-98 on November 6, 1997 and the crushing
/ production |
|
| figures
upto 6th January 1998 are given below: |
|
|
| Cane
Crushed (Tons) |
|
225,431 |
|
| Sugar
Recovery (%) |
|
9.78 |
|
| Sugar
Production (Tons) |
|
21,358 |
|
|
| As
reported in last year balance sheet Government has further increased the cane
price from Rs. 27/ |
|
| Md
to Rs. 36/Md and also increased the quality premium rate from paisas 27 to
paisas 32 per 0.1 |
|
| recovery
over and above 8.7~)/o, but unfortunately the above increase did not satisfy
cane growers and |
|
| they
are still demanding higher price for their crop. The situation has further
aggravated due to start of |
|
| commercial
production of new sugar mills in our district which increased crushing
capacity of mills in |
|
| our
district from 9000 to 17000 M/Tons per clay whereas area under cultivation
has hardly increased |
|
| by
10~)/0 consequently the available cane in the area is only 40% of the
crushing capacity. Not only this |
|
| but
sale of sugar has also become a problem because of the estimated excess
production in the |
|
| country.
Further as you know last year Government had imported huge quantity of cheap
sugar which |
|
| is
still lying in Sindh Province, therefore the production of sugar in Pakistan
generally and in Sindh |
|
| Province
specially not finding its market. The situation has deteriorated further
because some sugar |
|
| mills
having weak financial position and after failing to mobilize sufficient cash
resources are selling |
|
| their
sugar at throw-away prices. As a result the selling price of sugar has gone
much below the cost |
|
| price.
But the management of your mill with the help of Almighty Allah hopes to save
your mill from |
|
| financial
hardships. |
|
|
| PATTERN
OF SHARE HOLDING |
|
| The
pattern of share Holding is provided on page No. 6. |
|
|
| AUDITORS: |
|
| Messers,
Haroon Zakaria & Co. Chartered Accountant retiring auditors of the
Company offer them- |
|
| selves
for re-appointment for the year 1997-98. |
|
|
| At
the end the management pay thanks to all workers and non-management staff,
banks and financial |
|
| institutions
for their cooperation. |
|
|
|
| PATTERN
OF SHARE HOLDING |
|
| AS
AT SEPTEMBER 30, 1997 |
|
|
|
|
| Number of |
Share Holdings |
|
Total Shares |
|
| Share-holders |
From |
|
To |
|
Held |
|
| 454 |
1 |
-- |
100 |
|
45400 |
|
| 10256 |
101 |
-- |
500 |
|
5013900 |
|
| 66 |
501 |
-- |
1000 |
|
64500 |
|
| 58 |
1001 |
-- |
5000 |
|
148000 |
|
| 10 |
5001 |
-- |
10000 |
|
81500 |
|
| 10 |
10001 |
-- |
15000 |
|
132400 |
|
| 9 |
15001 |
-- |
20000 |
|
170900 |
|
| 3 |
20001 |
-- |
25000 |
|
75000 |
|
| 2 |
25001 |
-- |
30000 |
|
60000 |
|
| 2 |
30001 |
-- |
35000 |
|
63800 |
|
| 6 |
35001 |
-- |
40000 |
|
234400 |
|
| 3 |
40001 |
-- |
45000 |
|
128400 |
|
| 3 |
45001 |
-- |
50000 |
|
148400 |
|
| 1 |
60001 |
-- |
65000 |
|
64500 |
|
| 2 |
65001 |
-- |
70000 |
|
134100 |
|
| 1 |
90001 |
-- |
95000 |
|
90500 |
|
| 3 |
95001 |
-- |
100000 |
|
300000 |
|
| 1 |
100001 |
-- |
105000 |
|
101200 |
|
| 1 |
105001 |
-- |
110000 |
|
107500 |
|
| 1 |
110001 |
-- |
115000 |
|
114000 |
|
| 1 |
115001 |
-- |
120000 |
|
116000 |
|
| 1 |
125001 |
-- |
130000 |
|
129200 |
|
| 1 |
555001 |
-- |
560000 |
|
556182 |
|
| 1 |
1040001 |
-- |
1045000 |
|
1041750 |
|
| 2 |
1395001 |
-- |
1400000 |
|
2799336 |
|
| 1 |
2545001 |
-- |
2550000 |
|
2546232 |
|
| 1 |
2895001 |
-- |
2900000 |
|
2895200 |
|
| ---------- |
|
|
|
---------- |
|
| 10900 |
|
17362300 |
|
| ========= |
|
========= |
|
|
|
|
|
| Categories
of Shareholders |
Number |
Shares Held |
Percentage |
|
| Individuals |
|
10888 |
14197700 |
81.77 |
|
| Insurance
Company |
|
1 |
1500 |
0.01 |
|
| Joint
Stock Companies |
|
3 |
33500 |
0.19 |
|
| Financial
Institutions |
|
5 |
2977100 |
17.15 |
|
| Modaraba
Companies |
|
2 |
52500 |
0.30 |
|
| Charitable |
|
1 |
100000 |
0.58 |
|
|
---------- |
---------- |
---------- |
|
|
10900 |
17362300 |
100 |
|
|
========= |
========= |
========= |
|
|
|
|
|
| AUDITORS'
REPORT |
|
|
| We
have audited the annexed Balance Sheet of AL-ABBAS SUGAR MILLS LIMITED as at
Septem- |
|
| ber
30, 1997 and related Profit and Loss Account and Cash Flow Statement,
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 purpose of our |
|
| audit
and, after due verification thereof, we report that: |
|
|
| in
our opinion, proper books of account have been kept by the company as
required by the |
|
| Co
.mpanies Ordinance, 1984; |
|
|
| in
our opinion: |
|
|
| the
balance sheet and profit & loss account together with the notes thereof
have been |
|
| drawn
up in conformity with the Companies Ordinance, 1984 and are in agreement with |
|
| the
books of account 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, investment 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 & loss account and cash flow statement, 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 September 30, 1997 and of the Profit and the cash flow statement for
the year then |
|
| ended; and |
|
|
| (d)
in our opinion no Zakat was deductible at source under the Zakat an Ushr
Ordinance, 1980. |
|
|
| Karachi:
8th January, 1998 |
|
HAROON ZAKARIA &
COMPANY |
|
|
CHARTERED ACCOUNTANTS |
|
|
|
| BALANCE
SHEET AS AT 30TH SEPTEMBER, 1997 |
|
|
|
1997 |
1996 |
|
|
Notes |
Rupees |
Rupees |
|
|
| SHARES
CAPITAL & RESERVES |
|
|
|
| AUTHORISED
CAPITAL |
|
|
| 17,500,000
Ordinary Shares |
|
175,000,000 |
175,000,000 |
|
| of
Rs. 10/- each |
|
========== |
========== |
|
|
| ISSUED
SUBSCRIBED AND PAID |
|
3 |
173,623,000 |
173,623,000 |
|
| UP CAPITAL |
|
|
|
|
|
|
|
| GENERAL
RESERVE |
|
4 |
130,000,000 |
100,000,000 |
|
| UN-APPROPRIATED
PROFIT |
|
1,396,504 |
13,081,526 |
|
|
|
---------- |
---------- |
|
|
|
305,019,504 |
286,704,526 |
|
| REDEEMABLE
CAPITAL |
|
5 |
186,106,772 |
247,095,702 |
|
| DEFERRED
LIABILITIES |
|
6 |
39,425,695 |
5,175,986 |
|
|
|
| CURRENT
LIABILITIES |
|
|
| Current
Portion of Redeemable Capital |
|
7 |
60,988,931 |
55,174,212 |
|
| Short
Term Running Finance |
|
8 |
43,600,000 |
3,400,000 |
|
| Creditors,
Accrued & Other Liabilities |
|
9 |
99,360,140 |
74,661,000 |
|
| Provision
for Taxation |
|
293,756 |
6,258,025 |
|
|
---------- |
---------- |
|
|
204,242,827 |
139,493,237 |
|
| CONTINGENCIES
& COMMITMENTS |
|
10 |
-- |
-- |
|
|
---------- |
---------- |
|
|
734,794,798 |
678,469,451 |
|
|
========== |
========== |
|
| The
annexed notes form an integral part of these accounts. |
|
|
| TANGIBLE
FIXED ASSETS |
|
|
| Operating
Fixed Assets |
|
11 |
547,094,600 |
562,183,521 |
|
| Capital
Work-in-Progress |
|
12 |
5,675,485 |
3,441,106 |
|
|
---------- |
---------- |
|
|
552,770,085 |
565,624,627 |
|
|
| LONG
TERM LOANS & ADVANCES |
|
13 |
1,673,192 |
1,499,297 |
|
|
| LONG
TERM DEPOSITS & |
|
| DEFERRED
COST |
|
14 |
2,532,966 |
3,535,022 |
|
|
|
| CURRENT
ASSETS |
|
|
| Stores
and Spares |
|
15 |
50,951,183 |
55,851,307 |
|
| Stock-in-Trade |
|
16 |
100,399,445 |
25,760.87 |
|
| Trade
Debts (Unsecured Considered Good) |
|
|
1,032,134 |
8,821,723.00 |
|
| Loans
and Advances |
|
17 |
7,404,968 |
7,861,387.00 |
|
| Trade
Deposits and Short Term Pre-payments |
|
18 |
3,854,224 |
1,629,647 |
|
| Other'
Receivables |
|
|
7,601,316 |
13,936 |
|
| Cash
and Bank Balances |
|
19 |
6,575,285 |
7,871,636 |
|
|
---------- |
---------- |
|
|
177,818,555 |
107,810,505 |
|
|
---------- |
---------- |
|
|
734,794,798 |
678,469,451 |
|
|
=========== |
=========== |
|
|
|
| PROFIT
& LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED SEPTEMBER 30, 1997 |
|
|
1997 |
1996 |
|
|
Notes |
Rupees |
Rupees |
|
|
| SALES |
|
20 |
704,092,205 |
560,482,520 |
|
| COST
OF GOODS SOLD |
|
21 |
605,862,434 |
449,483,836 |
|
|
|
---------- |
---------- |
|
| GROSS PROFIT |
|
98,229,771 |
110,998,684 |
|
| OPERATING
EXPENSES |
|
| Administrative |
|
22 |
10,204,545 |
8,928,741 |
|
| Selling
& Distribution |
|
23 |
1,522,961 |
786,962 |
|
|
---------- |
---------- |
|
|
11,727,506 |
9,715,703 |
|
|
---------- |
---------- |
|
| OPERATING
PROFIT |
|
86,502,265 |
101,282,981 |
|
| Other Income |
|
24 |
402,826 |
890,171 |
|
|
---------- |
---------- |
|
|
86,905,091 |
102,173,152 |
|
|
| FINANCIAL
CHARGES |
|
25 |
42,690,332 |
48,854,559 |
|
| Other
Charges |
|
26 |
3,068,991 |
3,524,182 |
|
|
---------- |
---------- |
|
|
45,759,323 |
52,378,741 |
|
|
---------- |
---------- |
|
| PROFIT
BEFORE TAXATION |
|
41,145,768 |
49,794,411 |
|
| PROVISION
FOR TAXATION |
|
27 |
22,830,790 |
3,164,336 |
|
|
|
---------- |
---------- |
|
| PROFIT
AFTER TAXATION |
|
18,314,978 |
46,630,075 |
|
| Unappropriated
Profit brought forward |
|
13,081,526 |
1,451,451 |
|
|
---------- |
---------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATION |
|
31,396,504 |
48,081,526 |
|
| Appropriations |
|
| Transfer
to General Reserve |
|
30,000,000 |
35,000,000 |
|
|
---------- |
---------- |
|
|
1,396,504 |
13,081,526 |
|
|
========== |
========== |
|
| The
Annexed notes form an integral part of these accounts. |
|
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED SEPTEMBER 30, 1997 |
|
|
|
1997 |
1996 |
|
|
Rupees |
Rupees |
|
| A.
CASH FROM OPERATING ACTIVITIES |
|
|
| Profit
before taxation |
|
41,145,768 |
49,794,411 |
|
|
|
|
| Adjustment
for depreciation |
|
27,613,821 |
29,006,672 |
|
| Provision
for gratuity |
|
2,393,889 |
2,245,260 |
|
| Payment
of gratuity |
|
(904,686) |
(946,236) |
|
| Financial
charges |
|
42,690,332 |
48,854,559 |
|
| Gain
on disposal of fixed assets |
|
(402,826) |
(863,547) |
|
| Deferred
cost amortized |
|
903,424 |
903,424 |
|
|
---------- |
---------- |
|
| Operating
profit before working |
|
113,439,722 |
128,994,543 |
|
| capital
changes |
|
---------- |
---------- |
|
|
| Changes
in working capital (Increase)/ |
|
| decrease
in current assets |
|
| Stores
and spares |
|
4,900,124 |
259,577 |
|
| Stock
in trade |
|
(74,638,576) |
(18,241,240) |
|
| Trade debts |
|
7,789,589 |
(650,830) |
|
| Loans
and advances |
|
(976,569) |
933,366 |
|
| Deposits
and prepayments |
|
(2,224,577) |
286,078. |
|
| Other
receivables |
|
13,936 |
115,184 |
|
|
| Increase
in current liabilities |
|
| Creditors,
accrued and other liabilities |
|
| including
short term advances |
|
28,209,753 |
3,745,619 |
|
|
---------- |
---------- |
|
|
(36,926,320) |
(13,552,246) |
|
|
---------- |
---------- |
|
| Cash
generated from operation |
|
76,513,402 |
115,442,297 |
|
|
| Financial
charges paid |
|
(46,200,945) |
(55,949, 980) |
|
| Tax Paid |
|
(2,202,881) |
(3,965,447) |
|
|
---------- |
---------- |
|
|
(48,403,826) |
(59,915,427) |
|
|
---------- |
---------- |
|
| Net,
cash from operating activities |
|
28,109,576 |
55,526,870 |
|
|
========== |
========== |
|
|
| B.
CASH FROM INVESTING ACTIVITIES |
|
|
| Fixed
Capital expenditure |
|
(14,958,453) |
(9,740,431) |
|
| Proceeds
from disposal of fixed Assets |
|
602,000 |
1,420,501 |
|
| Long
term loans & advances |
|
(173,895) |
(39,610) |
|
| Long
term deposits and deferred cost |
|
98,632 |
366,032 |
|
|
---------- |
---------- |
|
| Net
cash used in investing activities |
|
(14,431,716) |
(7,993,508) |
|
|
========== |
========== |
|
| C.
CASH FROM FINANCING ACTIVITIES |
|
|
| Redemption
of redeemable capital |
|
(55,174,211) |
(49,929,443) |
|
| Repayment
of long term loans |
|
|
|
-- |
-- |
|
|
| Decrease)/Increase
in short term |
|
| borrowings |
|
40,200,000 |
3,400,000 |
|
|
---------- |
---------- |
|
| Net
cash from finance activities |
|
(14,974,211) |
(46,529,443) |
|
|
========== |
========== |
|
| Net
(Decrease)/Increase in cash and |
|
| cash
equivalents (A+B+C) |
|
(1,296,351) |
1,003,919 |
|
|
| Cash
and cash equivalents at beginning of |
|
| the year |
|
7,871,636 |
6,867,717 |
|
|
---------- |
---------- |
|
| Cash
and cash equivalents at end of the year |
|
65,757,285 |
7,871,636 |
|
|
========== |
========== |
|
|
|
| NOTES
TO THE ACCOUNTS FOR THE YEAR ENDED SEPTEMBER 30, 1997 |
|
|
| 1.
STATUS AND NATURE OF BUSINESS |
|
|
| The
Company was incorporated in Pakistan on 2nd May, 1991, as a Public Limited
Company |
|
| and
its shares are quoted on Karachi Stock Exchange. The principle activity of
the Company is |
|
| manufacturing
and sale of Sugar. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
| 2.1
Accounting Convention: |
|
| These
accounts have been prepared under historical cost convention without any
adjust- |
|
| ment
for the effect of inflation or current values. |
|
|
| 2.2
Taxation: |
|
| Current: |
|
| Provi |
