| AHMAD HASSAN TEXTILE MILLS LIMITED |
|
|
|
|
| Annual
Report 1997 |
|
|
|
|
|
| CONTENTS |
|
| BOARD
OF DIRECTORS |
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
| DIRECTORS'
REPORT |
|
| PATTERN
OF SHAREHOLDING |
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
| BALANCE
SHEET AS AT 30TM SEPTEMBER, 1997 |
|
| PROFIT
AND LOSS ACCOUNT |
|
| CASH
FLOW STATEMENT |
|
| NOTES
TO THE ACCOUNTS |
|
|
| BOARD
OF DIRECTORS |
|
| Mian
Mohammad Javed Anwar, Chairman |
|
| Mian
Mohammad Parvez, Chief Executive |
|
| Mrs.
Noor Jahan Begum |
|
| Mrs.
Salma Javed |
|
| Mrs.
Waheeda Parvez |
|
| Mr.
Mohammad Haris |
|
| Mrs.
Haleema Haris |
|
| Mr.
Mohammad Aurangzeb |
|
| Mr.
Imran Azim (Rep. N.I.T) |
|
|
|
|
| SECRETARY |
|
| Mr.
Shamsur Rahman |
|
|
| AUDITORS |
|
| Hameed
Chaudhri & Co; |
|
| Chartered
Accountants |
|
|
| BANKERS |
|
| Habib
Bank Limited |
|
| Bank
AI-Habib Limited |
|
|
| REGISTERED
OFFICE |
|
| 37-Tipu
Sultan Road, Multan Cantt. |
|
|
| HEAD
OFFICE |
|
| 46
- Hassan Parwana Colony, Multan. |
|
|
|
| MILLS |
|
|
| Chowk
Sarwar Shaheed, Distt. Muzaffargarh. |
|
|
|
|
| NOTICE
OF ANNLIAL GENERAL MEETING |
|
|
| Notice
is hereby given that the 8th Annual General Meeting of the Company will be |
|
| held
at its Head Office, 46 - Hassan Parwana Colony, Multan, on Monday, March 30,
1998 |
|
| at
9.00 A.M. to transact the following business: |
|
|
| 1.
To confirm the minutes of the 7th Annual General Meeting held on 30th March,
1997. |
|
|
| 2.
To receive, consider and adopt the Audited Accounts together with Directors'
and |
|
| Auditors'
Report for the year ended 30th September, 1997. |
|
|
| 3.
To approve a cash dividend at 7.5% i.e. Re. 0.75 per share of Rs. 10/- each
for the |
|
| year
ended 30.09.1997, as recommended by the Board of Directors. |
|
|
| 4.
To appoint Auditors for the financial year 1997 - 98, and fix their
remuneration. |
|
| 5.
To transact any other business with the permission of the Chair. |
|
|
| NOTES: |
|
|
| (i)
The Share Transfer Books of the Company will remain closed from 20th March, |
|
| 1998
to 30th March, 1998 (both days inclusive). Transfers received in order, at |
|
| the
Head Office of the Company upto 19th March, 1998, will be considered to be |
|
| in
time for the payment of dividend. |
|
|
| (ii)
A Member entitled to attend and vote at the meeting may appoint another |
|
| member
of the Company as a proxy to attend and vote instead of him/her. Proxy |
|
| forms
duly completed should reach the Registered Office of the Company at |
|
| least
48 hours before the time of the meeting. |
|
|
| (iii) Members are requested to notify immediately
any change in their address. |
|
|
|
| Directors'
Report |
|
|
| Dear
Shareholders |
|
|
| Your
Directors are pleased to present before you the 8th Annual Report on the
affairs |
|
| of
your company and its Financial Results for the year ended 30.09.1997.
Although the |
|
| problems
being faced by the Textile Spinning Industry for the last many years remained
un- |
|
| resolved
yet by the Grace of Almighty Allah your company, after meeting all costs,
earned a net |
|
| profit
of Rs. 25,109,125. |
|
|
| During
the period under report, the cotton crop remained satisfactory, ranging its
prices |
|
| between
Rs. 2200 to Rs. 2300 per maund. |
|
|
| Availability
of cotton on better rates and stable rates of cotton yarn both in the |
|
| international
and local market contributed towards profit. |
|
|
| FINANCIAL
RESULTS: |
|
|
| The
Directors of your company feel pleasure to report that despite high cost of
electricity, |
|
| mark-up,
fuel etc., the company after meeting all operational, administrative,
financial and |
|
| depreciation
expenses made a net profit of Rs. 25,109,125 against a profit of Rs.
14,273,488 last |
|
| year. |
|
|
| ACCOUNTS: |
|
|
| The
net profit of Rs. 25,109,125 earned by the company has been arrived at as
under:- |
|
|
| Operating
Profit including other Income |
|
53,032,644 |
|
| Financial
charges |
|
26,369,997 |
|
| Worker's
(Profit) Participation Fund |
|
1,321,550 |
|
| Net
Profit / (Loss) for the year. |
|
25,109,125 |
|
| Unappropriated
Profit - Brought Forward |
|
27,689,780 |
|
| Proposed
Final Dividend at the rate of |
|
|
| Re.
0.75 per share (7.5 percent) |
|
6,300,000 |
|
| Unappropriated
Profit |
|
|
| -
Carried to Balance Sheet. |
|
46,498,905 |
|
|
| OPERATIONAL
RESULTS: |
|
|
| During
the year under report, the Mills operated for 1092 shifts. Overall actual
production |
|
| when
converted into 20/1 count came to 4085893 kgs. |
|
|
| The
Plant is being run at optimum level and 101% efficiency of the installed
capacity was |
|
| achieved.
This achievement was mainly because of un-tiring efforts of Management and
the |
|
| Staff. |
|
|
| EXPORTS |
|
|
| During
the period under report, your company exported cotton yarn worth Rs.
184,704,235. |
|
|
|
| OTHERIMPORTANT
EVENTS: |
|
|
|
| 1.
The Tax Department had-raised tax demands aggregating Rs. 5.394 (M) under
Section |
|
| 80-D
of the Income Tax Ordinance, 1979 for the Income Years ended 30 September |
|
| 1992
to 30 September 1995 (Assessment Years 1993 - 94 to 1996 - 97). The Company |
|
| paid
Rs. 5.248 (M) under protest against these demands. In accordance with the |
|
| Supreme
Court of Pakistan's judgement dated 04 June 1995, the Company is not liable |
|
| to
pay Minimum Tax under Section 80-D. Resultantly the Tax Department shall
refund |
|
| the
amount so deposited. |
|
|
| 2.
The Mills was installed comprising 26 Ring Frames (12480 spindles) with Back |
|
| Process
Facility and other requirements like Building Space, Electrification, Air |
|
| Conditioning
etc., complete for 30 Ring Spinning Frames (about 14500 spindles). |
|
|
| Your
Company has decided to complete the Machinery by installing four more Ring |
|
| Spinning
Frames comprising 516 spindles each, raising the number to 14544. It has |
|
| planned
to import 4 sets of Ring Spinning Frames and Drafting System from China. |
|
| Auto
Cone Winder form Japan and two Crosrol MK5 Single High Production Cards |
|
| from U.K. |
|
|
|
| With
the installation of additional machinery the production on 20/1 count basis
will |
|
| increase
by 15% while running cost will be very nominal comprising of only additional |
|
| labour
and electricity. The revenue generated from additional production will add to
the |
|
| whole
project. |
|
|
| DIVIDEND: |
|
|
| Inspite
of expansion programme of about Rs. 20 Million for the Mills being undertaken
by |
|
| your
Company and payment of installments, your Directors are pleased to recommend
Final |
|
| Dividend
at the rate of Re. 0.75 per share (7.5 percent). |
|
|
| AUDITORS: |
|
|
| Your
Company's Auditors M/s Hameed Chaudhri and Company, Chartered Accountants, |
|
| Lahore,
retire and being eligible offer themselves for re-appointment for the next
year. |
|
|
| COMMENTS
ON AUDITORS QUALIFICATION: |
|
|
| 1.
NOTE 22.3 |
|
| In
the opinion of your Directors, the levy of Corporate Asset Tax is not
justified. Your |
|
| Company
therefore, challenged its validity through Writ Petition filed before the
Honourable |
|
| Lahore
High Court Multan Bench, Multan. The Honourable Lahore High Court stayed the |
|
| recovery
of the disputed amount subject to furnishing of Bank / Insurance Guarantee. |
|
| Necessary
guarantees have been furnished and on .the expiry of the statutory period of
six |
|
| months,
also have made the payment of disputed amount under protest. Since there are |
|
| bright
chances of winning the case, provision for this Tax has not been made in the |
|
| accounts
and the amount paid under protest is being reflected under advance tax. |
|
|
|
|
| PATTERN
OF SHAREHOLDING |
|
|
| Pattern
of holding of the shares by the shareholders of the Company as on |
|
| 30.09.1997,
as required under Section 236 (2) (d) of the Companies Ordinance, 1984, is |
|
| enclosed. |
|
|
| ACKNOWLEDGMENT |
|
|
| We
would like to appreciate the efforts made by our workers and staff for their |
|
| deep
devotion to work. |
|
|
| We
also wish to express our thanks to the Financial Institutions, particularly
Habib |
|
| Bank
Limited and Bank AI Habib Limited for their continued support and
co-operation. |
|
|
|
| Pattern
of holding of the Shares by the Shareholders as at 30 September, 1997 |
|
|
|
| Category |
Shareholdings |
Number of |
|
Total |
|
|
|
From |
To |
Share Holders |
Shares held |
|
|
| 1 |
1 |
100 |
162 |
|
16200 |
|
|
| 2 |
101 |
500 |
3145 |
|
1505600 |
|
|
| 3 |
501 |
1000 |
48 |
|
47400 |
|
|
| 4 |
1001 |
5000 |
96 |
|
267700 |
|
|
| 5 |
5001 |
10000 |
21 |
|
157600 |
|
|
| 6 |
10001 |
15000 |
3 |
|
43300 |
|
|
| 7 |
15001 |
20000 |
5 |
|
88400 |
|
|
| 8 |
20001 |
25000 |
4 |
|
94700 |
|
|
| 9 |
25001 |
30000 |
6 |
|
178100 |
|
|
| 10 |
30001 |
35000 |
1 |
|
33400 |
|
|
| 11 |
35001 |
40000 |
0 |
|
0 |
|
|
| 12 |
40001 |
45000 |
1 |
|
44000 |
|
|
| 13 |
45001 |
50000 |
4 |
|
195400 |
|
|
| 14 |
50001 |
55000 |
0 |
|
0 |
|
|
| 15 |
55001 |
60000 |
2 |
|
118800 |
|
|
| 16 |
60001 |
65000 |
1 |
|
64000 |
|
|
| 17 |
65001 |
70000 |
1 |
|
70000 |
|
|
| 18 |
70001 |
75000 |
2 |
|
148000 |
|
|
| 19 |
75001 |
80000 |
1 |
|
80000 |
|
|
| 20 |
80001 |
130000 |
2 |
|
179700 |
|
|
| 21 |
130001 |
135000 |
0 |
|
0 |
|
|
| 22 |
135001 |
225000 |
3 |
|
531000 |
|
|
| 23 |
225001 |
230000 |
0 |
|
0 |
|
|
| 24 |
230001 |
235000 |
0 |
|
0 |
|
|
| 25 |
235001 |
240000 |
1 |
|
239500 |
|
|
| 26 |
240001 |
245000 |
0 |
|
0 |
|
|
| 27 |
245001 |
250000 |
0 |
|
0 |
|
|
| 28 |
250001 |
255000 |
0 |
|
0 |
|
|
| 29 |
255001 |
300000 |
4 |
|
1098200 |
|
|
| 30 |
300001 |
305000 |
1 |
|
300500 |
|
|
| 31 |
305001 |
360000 |
1 |
|
305500 |
|
|
| 32 |
360001 |
365000 |
0 |
|
0 |
|
|
| 33 |
365001 |
380000 |
0 |
|
0 |
|
|
| 34 |
380001 |
385000 |
0 |
|
0 |
|
|
| 35 |
385001 |
450000 |
0 |
|
0 |
|
|
| 36 |
450001 |
455000 |
0 |
|
0 |
|
|
| 37 |
455001 |
500000 |
0 |
|
0 |
|
|
| 38 |
500001 |
505000 |
0 |
|
0 |
|
|
| 39 |
505001 |
905000 |
2 |
|
1126000 |
|
|
| 40 |
905001 |
1500000 |
1 |
|
1467000 |
|
|
| 41 |
1500001 |
5000000 |
0 |
|
0 |
|
|
|
------------ |
|
------------ |
|
|
|
3518 |
|
8400000 |
|
|
|
========= |
|
========= |
|
|
|
|
|
|
| Categories
of |
|
No. of |
Shares |
|
|
| Shareholders |
|
Share holders |
held |
Percentage |
|
|
|
|
|
| Individuals |
|
3,507 |
6,498,300 |
77.37 |
|
| Joint
Stock Companies |
|
3 |
43,900 |
0.52 |
|
| Financial
Institutions |
|
8 |
1,857,800 |
22.11 |
|
|
|
------------ |
------------ |
------------ |
|
|
3,518 |
8,400,000 |
100.00 |
|
|
========= |
========= |
========= |
|
|
|
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS OF |
|
| AHMAD
HASSAN TEXTILE MILLS LIMITED |
|
|
|
| We
have audited the annexed Balance Sheet of AHMAD HASSAN TEXTILE MILLS |
|
| LIMITED
as at 30 September, 1997 and the 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 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 account and are |
|
| further
in accordance with accounting policies consistently applied; |
|
|
|
|
| (ii)
the expenditure incurred during the year was for the purposes 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 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, |
|
| except
for the fact that provision for Corporate Assets Tax amounting Rs.1.440 |
|
| million
has not been made in these accounts (Note 22.3) and the fact that Exchange |
|
| Risk
Coverage Fee has been capitalised contrary to the provisions of National and |
|
| International
Accounting Standards (note10.1) and the contents of note 21 and the |
|
| extent
to which these may effect the annexed accounts, respectively give a true and |
|
| fair
view of the state of the Company's affairs as at 30 September, 1997 and of
the |
|
| profit
and cash flows for the year then ended; and |
|
|
| (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. |
|
|
| LAHORE; |
|
HAMEED CHAUDHRI &
CO., |
|
| Dated
:- 11.02.1998 |
Chartered Accountants. |
|
|
|
|
| BALANCE
SHEET AS AT 30th SEPTEMBER, 1997 |
|
|
|
|
|
|
|
1997 |
1996 |
|
|
|
|
Note |
Rupees |
Rupees |
|
|
| CAPITAL
AND RESERVES |
|
| Authorised
capital |
|
| 10,000,000
ordinary shares |
|
| of
Rs. 10 each |
|
|
|
100,000,000 |
100,000,000 |
|
|
========= |
========= |
|
| Issued
subscribed and |
|
| paid
up capital |
|
| 8,400,000
ordinary shares |
|
| of
Rs. 10 each - issued for cash |
|
|
84,000,000 |
84,000,000 |
|
| Unappropriated
profit |
|
|
46,498,905 |
27,689,780 |
|
|
|
---------- |
---------- |
|
|
|
130,498,905 |
111,689,780 |
|
| LONG
TERM FINANCES |
|
|
3 |
45,233,937 |
70,749,036 |
|
| CUSTOM'S
DUTI ES PAYABLE |
|
|
4 |
1,803,870 |
2,405,160 |
|
| DEFERRED
LIABILITIES |
|
|
|
| Provision
for gratuity |
|
|
719,247 |
676,632 |
|
|
| CURRENT
LIABILITIES |
|
| Current
portion of |
|
|
|
|
|
| long
term liabilities |
|
5 |
30,248,290 |
165,021,290 |
|
| Short
term finances |
|
|
6 |
24,051 |
14,024,461 |
|
| Creditors,
accruals and |
|
|
|
|
| other
liabilities .. |
|
7 |
17,930,134 |
25,428,454 |
|
| Dividends |
|
|
|
8 |
7,363,210 |
6,300,000 |
|
|
|
|
----------- |
----------- |
|
|
|
|
55,565,685 |
62,255,205 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
9 |
|
|
|
----------- |
----------- |
|
|
|
233,821,824 |
247,775,813 |
|
|
|
========= |
========= |
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
| TANGIBLE
OPERATING |
|
| FIXED
ASSETS |
|
|
10 |
162,986,641 |
178,290,485 |
|
|
| LONG
TERM SECURITY |
|
| DEPOSITS |
|
|
177,890 |
182,320 |
|
|
| CURRENT
ASSETS |
|
| Stores,
Spares and tools |
|
|
11 |
5,748,264 |
5,172,087 |
|
| Stock
in trade |
|
|
12 |
36,974,016 |
11,918,648 |
|
| Trade
debtors |
|
|
13 |
14,978,501 |
29,065,069 |
|
| Advances,
deposits, prepayments |
|
|
|
| and
other receivables |
|
14 |
8,926,876 |
12,226,535 |
|
| Cash
and bank balances |
|
|
15 |
4,029,636 |
10,920,669 |
|
|
|
------------ |
------------ |
|
|
|
70,657,293 |
69,303,008 |
|
|
------------ |
------------ |
|
|
|
233,821,824 |
247,775,813 |
|
|
========= |
========= |
|
|
| Profit
and Loss Account |
|
| for
the year ended 30 September, 1997 |
|
|
|
|
|
|
1997 |
1996 |
|
|
|
Note |
Rupees |
Rupees |
|
|
| SALES
- Net |
|
|
16 |
454,999,407 |
440,570,428 |
|
| COST
OF SALES |
|
|
17 |
389,070,984 |
379,455,322 |
|
|
|
|
|
----------- |
----------- |
|
| GROSS
PROFIT |
|
|
65,928,423 |
61,115,106 |
|
|
| ADMINISTRATIVE
AND SELLING |
|
| EXPENSES |
|
18 |
12,895,779 |
16,684,554 |
|
|
|
|
----------- |
----------- |
|
| OPERATING
PROFIT |
|
|
|
53,032,644 |
44,430,552 |
|
|
| OTHER
CHARGES |
|
| Financial- |
|
|
|
19 |
26,369,997 |
22,883,561 |
|
| Miscellaneous |
|
|
20 |
231,972 |
457,413 |
|
| Additional
surcharge on |
|
| Electricity
- Prior years' |
|
|
|
0 |
6,064,854 |
|
| Workers'
(Profit) |
|
|
|
| Participation
Fund |
|
|
|
1,321,550 |
751,236 |
|
|
|
----------- |
----------- |
|
|
|
27,923,519 |
30,157,064 |
|
|
|
----------- |
----------- |
|
| PROFIT
FOR THE YEAR |
|
|
25,109,125 |
14,273,488 |
|
| UNAPPROPRIATED
PROFIT |
|
| - Brought forward |
|
|
27,689,780 |
19,716,292 |
|
|
|
|
|
----------- |
----------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATION |
|
52,798,905 |
33,989,780 |
|
|
| APPROPRIATION: |
|
| Proposed
Dividend @ 7.5% (1996: @ 7.5%) |
|
6,300,000 |
6,300,000 |
|
| UNAPPROPRIATED
PROFIT |
|
|
----------- |
----------- |
|
| - Carried to Balance Sheet |
|
|
46,498,905 |
27,689,780 |
|
|
========= |
========= |
|
| The
annexed notes form an integral pad of these accounts. |
|
|
|
| CASH
FLOW STATEMENT |
|
| for
the year ended 30 September, 1997 |
|
|
|
1996 |
1997 |
|
|
Rupees |
Rupees |
|
|
|
|
| NET
CASH IN FLOW FROM OPERATING |
|
| ACTIVITIES
(note 'A') |
|
|
55,062,787 |
45,948,506 |
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Tangible
fixed assets acquired |
|
|
(1,084,780) |
(2,797,815) |
|
| Long
term deposits |
|
|
4,430 |
(5,450) |
|
| Sale
proceeds of fixed assets |
|
|
9,500 |
1,562,000 |
|
|
------------ |
------------ |
|
| NET
CASH OUT FLOW FROM INVESTING |
|
| ACTIVITIES |
|
|
|
(1,070,850) |
(1,241,265) |
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Long
term finances repaid |
|
|
(15,901,000) |
0 |
|
| Custom
duties paid |
|
|
|
(601,290) |
0 |
|
| Shod
term finances - Net |
|
|
(14,000,410) |
(14,627,412) |
|
| Dividend
paid |
|
|
|
(5,236,790) |
|
|
| Financial
charges paid |
|
|
|
(25,143,480) |
(19,203,670) |
|
|
------------ |
------------ |
|
| NET
CASH OUTFLOW FROM |
|
| FINANCING
ACTIVITIES |
|
|
(60,882,970) |
(33,831,082) |
|
|
|
------------ |
------------ |
|
| NET
(DECREASE) / INCREASE IN CASH AND |
|
| CASH
EQUIVALENTS |
|
|
(6,891,033) |
10,876,159 |
|
|
| CASH
AND CASH EQUIVALENTS |
|
| -
At the beginning of the year |
|
|
|
10,920,669 |
44,510 |
|
|
|
|
|
|
| CASH
AND CASH EQUIVALENTS |
|
|
------------ |
------------ |
|
| -
At the end of the year |
|
|
|
4,029,636 |
10,920,669 |
|
|
========== |
========== |
|
| The
annexed note 'A' forms an integral part of this statement. |
|
|
| Mian Mohammad Javed Anwar |
Mian Mohammad Parvez |
Mohammad Haris |
|
| Chairman |
Chief Executive |
Director |
|
|
| NOTE 'A' |
|
|
|
|
|
1997 |
1996 |
|
|
|
Rupees |
Rupees |
