| THE CRESCENT TEXTILE MILLS LIMITED |
|
|
|
|
|
|
|
|
|
| ANNUAL
REPORT 1997 |
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|
|
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| CONTENTS |
|
| Company
Information |
|
| Notice
of Annual General Meeting |
|
| Directors'
Report to the Shareholders |
|
| Chairman's
Review |
|
| Five
Years Progress at a Glance |
|
| Pattern
of Shares Holding |
|
| Auditors'
Report to the Members |
|
| Balance
Sheet |
|
| Profit
& Loss Account |
|
| Statement
of Funds |
|
| Notes
to the Accounts |
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|
|
| COMPANY
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
|
| MR.
MUHAMMAD ANWAR (CHAIRMAN & CHIEF EXECUTIVE) |
|
| MR.
A. K. M. SAYEED (NOMINEE: NIT) |
|
| MR.
ALTAF M. SALEEM |
|
| MR.
HUMAYUN MAZHAR |
|
| MR.
KHALID BASHIR |
|
| MR.
MUHAMMAD ARSHAD |
|
| MR.
NASIR SHAFI |
|
|
| CORPORATE
SECRETARIES |
|
| MR.
ZAHEER A. SHAIKH |
|
| MR.
RASHID SADIQ |
|
|
| AUDITORS |
|
| RIAZ
AHMAD & COMPANY |
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| CHARTERED
ACCOUNTANTS |
|
|
| BANKERS |
|
| ABN
AMRO BANK |
|
| ALLIED
BANK OF PAKISTAN LIMITED |
|
| AMERICAN
EXPRESS BANK LIMITED |
|
| BANK
OF AMERICA |
|
| CITIBANK
N. A. |
|
| EMIRATES
BANK INTERNATIONAL LIMITED |
|
| FAYSAL
BANK LIMITED |
|
| MUSLIM
COMMERCIAL BANK LIMITED |
|
| NATIONAL
BANK OF PAKISTAN |
|
| UNITED
BANK LIMITED |
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|
| REGISTERED
OFFICE |
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| 83.
BABAR BLOCK, |
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| NEW
GARDEN TOWN, |
|
| LAHORE |
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|
| HEAD
OFFICE & MILLS |
|
| SARGODHA
ROAD, |
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| FAISALABAD |
|
|
| LIAISON
OFFICE |
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| SIDCO
AVENUE CENTRE |
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| 264
R.A. LINES, STRATCHEN ROAD, |
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| KARACHI |
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|
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| NOTICE
OF ANNUAL GENERAL MEETING |
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| NOTICE
IS HEREBY GIVEN THAT the 48th Annual General Meeting of the shareholders |
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| of
THE CRESCENT TEXTILE MILLS LIMITED will be held on Monday, the March 30, |
|
| 1998
at 10:30 a.m. at Registered Office, 83-Babar Block, New Garden Town, Lahore
to |
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| transact
the following business:- |
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|
|
|
| 1.
To receive and adopt the Audited Accounts of the Company for the year ended
September |
|
| 30,
1997 together with the Directors' and Auditors' Reports thereon. |
|
|
| 2.
To approve, as recommended by the Directors, the payment of 12.5% cash
dividend and issue of 5% |
|
| Bonus
shares, in the ratio of one Bonus share for every twenty existing shares. |
|
|
| 3.
To appoint Auditors for the next financial year and fix their remuneration.
The present Auditors M/s. |
|
| Riaz
Ahmad & Company, Chartered Accountants retire and being eligible, offer
themselves for re- |
|
| appointment. |
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|
|
|
| PARTICIPATION
IN THE ANNUAL GENERAL MEETING |
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| A
member eligible to attend and vote at this Meeting may appoint another member
as his/her proxy to attend |
|
| and
vote in his/her place. Proxies in order to be effective must be received by
the Company at the Registered |
|
| Office
not later than 48 hours before the time for holding the Meeting |
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|
|
| BOOK
CLOSURE |
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| The
Share Transfer Books of the Company will remain closed from March 25, 1998 to
March 31,1998 (both |
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| days
inclusive). Transfers received at the Registered Office of the Company by the
close of business on |
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| March
24, 1998 will be treated in time for the purpose of payment of cash dividend
and issue of bonus |
|
| shares
to the transferees. |
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| ON
BEHALF OF THE BOARD |
|
|
| ZAHEER
A. SHAIKH |
|
| CORPORATE
SECRETARY |
|
|
| REGISTERED
OFFICE: |
|
| 83-Babar
Block, New Garden Town |
|
| Lahore: |
|
|
| Telephone
No. (042) 5881974-75 |
|
| Fax
No. (042) 5881976 |
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| Dated:
February 20, 1998. |
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|
|
|
| DIRECTORS'
REPORT TO THE SHAREHOLDERS |
|
| Your
Directors are pleased to present their report and audited financial
statements together with auditors |
|
| report
thereon for the year ended 30 September 1997. |
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| Your
Company's operations for the year resulted in a net after tax profit of
Rupees 187.927 million. |
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| Earning
per share is Rupees 5.09. |
|
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| Your
Directors recommend appropriation of profit as follows: |
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|
|
|
|
(RUPEES IN THOUSAND) |
|
| Profit
available for appropriation |
|
192 320 |
|
| Appropriation |
|
|
|
| Transfer
to general reserves |
|
130 000 |
|
| Transfer
to reserve for issue of bonus shares |
15 585 |
|
| Proposed
dividend @ 12.5% |
|
|
46 110 |
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|
---------- |
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|
191 695 |
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|
---------- |
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|
625 |
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|
========== |
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| Your
Directors recommended cash dividend at the rate of 12.5% (Rupees 1.25 per
share) and issue of |
|
| bonus
share at the rate of 5% of the share holding out of premium on issue of right
share and profit and loss |
|
| account. |
|
|
| The
accompanying Chairman's' Review provides more details of the financial
affairs and the future prospects |
|
| of
the Company. |
|
|
| AUDITORS |
|
|
| The
present auditors M/s Riaz Ahmad and Company, Chartered Accountants retire and
being eligible, offer |
|
| themselves
for reappointment. |
|
|
| PATTERN
OF SHAREHOLDING |
|
| The
pattern of shareholding as required by section 236 of the Companies
Ordinance, 1984 is attached to |
|
| this
report. |
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|
|
|
|
|
|
| CHAIRMAN'S
REVIEW |
|
| This
is an occasion of great pleasures to |
|
| welcome
you to the 48th Annual General |
|
| Meeting
of the company and present to you |
|
| the
audited financial statements for year |
|
| ended
September 30, 1997. |
|
|
| Before
I brief the financial results and |
|
| achievements of the
Company, I would like to |
|
| inform
you that The Crescent Textile Mills |
|
| Limited
has been awarded the quality systems |
|
| ISO-9002
certificate in July, 1997. Your's is |
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| the
first ever composite textile company in |
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| Pakistan
to have received this accreditation. |
|
|
|
|
|
|
| On
the financial aspect, by the grace of Allah, |
|
| the
results for the financial year under review |
|
| show
significant improvement. Your company |
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| earned
highest ever after tax profit of Rupees |
|
| 187.927
million in 1996-97 surpassing the |
|
| previous
highest mark of Rs. 150.470 million |
|
| posted
in 1990-91. The year under review |
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| embraced
full years impact of sales tax statute |
|
| that
caused changes in the elements of cost |
|
| of
sales reflected in the financial statement |
|
| through
mechanism of input/output sales tax |
|
| that
reduced the cost of input materials which |
|
| was
offset by reduction in export rebates that |
|
| induced
reduction in export revenue. |
|
| Furthermore,
use of polyester in yarn |
|
| manufacturing
at reduced price, cut down the |
|
|
|
|
| total
cost of sales by Rs. 288.113 million that |
|
| increased
the gross profit by Rs. 26.038 |
|
| million
(4.76%) as the turnover decreased by |
|
| Rs.
262.075 million (6.65%) over |
|
| corresponding
year. The major factor in revenue |
|
| decrease
was the reduction in export rebates |
|
| by
Rs. 146.644 million (3.72%). Operating profit |
|
| increased
by 18.89% to Rupees 335.727 million |
|
| from
Rs. 282.373 million in 1996. Financial |
|
| charges
decreased by 39.27% to Rs. 129.904 |
|
| million
from the last year's expense of Rs. |
|
| 213.907
million due to better control over |
|
| inventories
and funds generation from profitable |
|
| operations
and reduction in markup rates by |
|
| lending
institutions. After tax profit almost tripled |
|
| during
the current year to Rs. 187.927 million |
|
| from
64.843 million in the previous year. |
|
|
| The
Statement of Balances as at 30 September, |
|
| 1997
was healthier and stronger compared with |
|
| September
30, 1996. In terms of business/ |
|
|
| financial
ratios, these far exceed the |
|
| requirements
of the Prudential Regulations of |
|
| State
Bank of Pakistan. |
|
|
| OPERATIONS |
|
| Spinning
sector of the Crescent Textile Mills |
|
| Limited
employ's most of the workforce, |
|
| consumes
majority of the inputs and continues |
|
| to
get greater share of managerial expertise |
|
| and
services due to its size & spindlage. Cotton |
|
| crop
again failed to supply quality cotton during |
|
| the
season 1996-97. We shared local market |
|
| of
fine count by using imported Russian and |
|
| American
long staple cotton. |
|
|
| We
have plans to upgrade the older mills with |
|
| modernized
blow rooms lines, carding |
|
| machines
and drawing frames to improve |
|
| quality
of yarn produced. |
|
|
| Your
company has ultimate plan to sell only the |
|
| value
added products of the manufacturing line/ |
|
|
| process.
Eventually no yarn but only processed |
|
| fabric
sales are in the far sight. To start with, |
|
| we
are in the process of acquiring an ongoing |
|
| project of, 72 Air Jet
Looms at Hattar, as a |
|
| wholly
owned subsidiary of your company |
|
| arrangement. |
|
|
| Our
Processing Sector is equipped with latest |
|
| technology
Bleaching, Dyeing, Printing and |
|
| Finishing
machinery. We focussed on and |
|
| succeeded
in containing the reject percentage |
|
| to
minimal level and improve the quality of our |
|
| finished
fabric to the satisfaction of customers |
|
| of
our products. |
|
|
| The
management of your company has always |
|
| been
keen & desirous and working on |
|
|
|
| improving
the systems, personnel work |
|
| performance
and product quality standards, |
|
| which
has been reflected by ISO - 9002 |
|
| certification
of the company. |
|
|
| I
am grateful to our customers, the bankers |
|
| and
all agencies who have directly or indirectly |
|
| helped
us in achieving what we are today. I |
|
| would
also like to express my appreciation for |
|
| the
continued interest and support of all the |
|
| shareholders.
I also express my appreciation |
|
| for
team work discipline of the employees of |
|
| the
company who have made it fine place to |
|
| work. |
|
|
|
|
|
|
|
|
|
|
| FIVE
YEARS' PROGRESS AT A GLANCE |
|
|
|
Rs. in Min |
1993 |
1994 |
1995 |
1996 |
1997 |
|
|
|
|
| Paid
up Capital |
|
-do- |
109.77 |
241.50 |
313.18 |
335.35 |
368.88 |
|
| Reserves
and Surplus |
|
-do- |
524.44 |
606.08 |
588.82 |
640.79 |
749.07 |
|
| Share
Holder's Equity |
-do- |
634.21 |
847.58 |
902.00 |
976.14 |
1117.95 |
|
| Long
Term Liabilities |
-do- |
542.19 |
468.18 |
410.12 |
457.80 |
421.08 |
|
| Investments |
|
-do- |
113.06 |
266.04 |
428.13 |
428.33 |
476.25 |
|
| Market
Value of Investments |
-do- |
268.86 |
672.62 |
615.64 |
410.68 |
480.96 |
|
| Current
Assets |
|
-do- |
1039.16 |
1041.57 |
1152.51 |
1647.78 |
1674.13 |
|
| Total
Assets |
|
-do- |
2177.15 |
2308.54 |
2502.23 |
2919.69 |
2998.77 |
|
| Turnover |
|
-do- |
2655.66 |
3265.48 |
3524.06 |
3941.40 |
3679.32 |
|
| Cost
of Sales |
|
-do- |
2260.07 |
2792.25 |
3098.82 |
3394.93 |
3106.82 |
|
| Gross
Profit |
|
-do- |
395.59 |
473.23 |
425.24 |
546.47 |
572.50 |
|
| Profit/(Loss)
Before Taxation |
-do- |
25.28 |
46.75 |
(10.29) |
90.85 |
218.72 |
|
| Profit
After Taxation |
-do- |
8.55 |
102.60 |
1.22 |
64.84 |
187.93 |
|
| Break
up Value of Rupees 10 Share |
Rupees |
57.78 |
35.10 |
28.80 |
29.11 |
31.56 |
|
| Earning
Per Share (Pretax) |
-do- |
2.30 |
1.94 |
(0.32) |
2.71 |
5.93 |
|
| Earning
Per Share (Aftertax) |
-do- |
0.78 |
4.25 |
0.04 |
1.93 |
5.09 |
|
| Gross
Profit to Sales |
Percent |
14.90 |
14.49 |
12.07 |
13.86 |
15.56 |
|
| Profit/(Loss)
Before Tax to Sales |
-do- |
0.95 |
1.43 |
(0.29) |
2.30 |
5.94 |
|
| Dividend
per share |
|
-do- |
- |
- |
- |
- |
1.25 |
|
| Bonus
Shares |
|
-do- |
10 |
15 |
5 |
10 |
5 |
|
| Debt
Equity Ratio |
|
Tims |
0.46 |
0.36 |
0.31 |
0.32 |
0.27 |
|
| Current
Ratio |
|
-do- |
1.16 |
1.08 |
0.97 |
1.11 |
1.18 |
|
| Financial
Charges Coverage |
-do- |
1.15 |
1.25 |
0.96 |
1.42 |
2.68 |
|
| Stock
Turnover |
|
-do- |
7.74 |
8.06 |
7.06 |
9.85 |
6.78 |
|
| Short
Term Borrowings to Sales |
-do- |
0.23 |
0.17 |
0.25 |
0.29 |
0.24 |
|
|
|
|
|
|
|
| PATTERN
OF SHAREHOLDING AS AT 30 SEPTEMBER, 1997. |
|
|
|
|
(FORM "34") |
|
|
| No. of |
Shareholding |
Total |
No. of |
Shareholding |
Total |
|
|
|
| Share- |
|
shares- |
Share- |
|
|
shares- |
|
|
|
| holders |
From |
To |
helds |
holders |
From |
To |
helds |
|
|
|
| 285 |
1 |
100 |
10,531 |
2 |
155001 |
160000 |
332,328 |
|
|
| 449 |
101 |
500 |
117,052 |
2 |
160001 |
165000 |
347,279 |
|
|
| 286 |
501 |
1000 |
199,014 |
1 |
165001 |
180000 |
179,879 |
|
|
| 548 |
1001 |
5000 |
1,259,236 |
1 |
180001 |
205000 |
180,849 |
|
|
| 148 |
5001 |
10000 |
1,248,280 |
1 |
205001 |
225000 |
194,084 |
|
|
| 76 |
10001 |
15000 |
896,811 |
1 |
225001 |
230000 |
196,694 |
|
|
| 43 |
15001 |
20000 |
739,620 |
1 |
230001 |
235000 |
216,700 |
|
|
| 25 |
20001 |
25000 |
569,806 |
3 |
235001 |
240000 |
668,780 |
|
|
| 19 |
25001 |
30000 |
524,660 |
2 |
240001 |
255000 |
496,285 |
|
|
| 16 |
30001 |
35000 |
513,576 |
3 |
255001 |
260000 |
759,243 |
|
|
| 12 |
35001 |
40000 |
522,560 |
1 |
260001 |
265000 |
277,288 |
|
|
| 10 |
40001 |
45000 |
423,485 |
1 |
265001 |
270000 |
287,061 |
|
|
| 4 |
45001 |
50000 |
187,265 |
4 |
270001 |
280000 |
1,190,270 |
|
|
| 8 |
50001 |
55000 |
428,986 |
2 |
280001 |
285000 |
604,159 |
|
|
| 9 |
55001 |
60000 |
514,640 |
2 |
285001 |
310000 |
616,283 |
|
|
| 6 |
60001 |
65000 |
374,706 |
1 |
310001 |
315000 |
338,507 |
|
|
| 3 |
65001 |
70000 |
204,964 |
1 |
315001 |
325000 |
343,659 |
|
|
| 1 |
70001 |
75000 |
74,483 |
1 |
325001 |
345000 |
345,655 |
|
|
| 2 |
75001 |
80000 |
152,643 |
1 |
345001 |
365000 |
366,573 |
|
|
| 6 |
80001 |
85000 |
493,834 |
3 |
365001 |
370000 |
1,205,369 |
|
|
| 3 |
85001 |
90000 |
258,106 |
1 |
370001 |
375000 |
413,970 |
|
|
| 3 |
90001 |
95000 |
277,143 |
1 |
375001 |
380000 |
419,510 |
|
|
| 3 |
95001 |
100000 |
292,359 |
1 |
380001 |
385000 |
446,217 |
|
|
| 4 |
100001 |
105000 |
418,136 |
1 |
415001 |
420000 |
503,056 |
|
|
| 1 |
105001 |
110000 |
106,354 |
1 |
455001 |
460000 |
506,352 |
|
|
| 2 |
110001 |
115000 |
227,074 |
1 |
460001 |
465000 |
598,632 |
|
|
| 3 |
115001 |
120000 |
235,851 |
1 |
470001 |
475000 |
772,746 |
|
|
| 3 |
120001 |
125000 |
366,010 |
1 |
530001 |
535000 |
861,848 |
|
|
| 1 |
125001 |
130000 |
129,254 |
1 |
700001 |
705000 |
88,762 |
|
|
| 4 |
130001 |
135000 |
530,729 |
1 |
795001 |
800000 |
953,232 |
|
|
| 3 |
135001 |
140000 |
411,736 |
1 |
805001 |
810000 |
984,258 |
|
|
| 4 |
140001 |
145000 |
609,294 |
1 |
865001 |
870000 |
1,262,145 |
|
|
| 2 |
145001 |
150000 |
319,394 |
1 |
890001 |
895000 |
2,010,592 |
|
|
| 2 |
150001 |
155000 |
327,594 |
1 |
1155001 |
1160000 |
3,226,008 |
|
|
|
---------- |
|
|
---------- |
|
|
|
2077 |
|
|
36,888,307 |
|
|
|
========== |
|
|
========== |
|
|
|
| Categories
of Shareholders |
Number |
Shares Held |
Percentage |
|
|
|
|
|
| Individuals |
|
1977 |
21477905 |
58.23 |
|
| Investment
Companies |
|
6 |
775911 |
2.10 |
|
| Insurance
Companies |
|
6 |
1357643 |
3.68 |
|
| Joint
Stock Companies |
42 |
5316573 |
14.41 |
|
| Financial
Institutions |
14 |
4587211 |
12.44 |
|
| Others |
|
32 |
3373064 |
9.14 |
|
|
|
---------- |
---------- |
---------- |
|
| TOTAL |
|
2077 |
36888307 |
100.00 |
|
|
|
========== |
========== |
========== |
|
| Others |
|
|
|
| Abandoned
Property |
|
2 |
524 |
- |
|
| Modarabas |
|
5 |
387632 |
1..05 |
|
| Non-residents |
|
25 |
2984908 |
8.09 |
|
|
|
---------- |
---------- |
---------- |
|
| TOTAL |
|
32 |
3373064 |
9.14 |
|
|
========== |
========== |
========== |
|
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of THE CRESCENT TEXTILE MILLS LIMITED
as at 30 |
|
| September
1997 and the related profit and loss account and statement of sources and
application of funds, |
|
| 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 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 sources and application
of funds, 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 30 September 1997 and of the profit and the changes in sources and
application of funds |
|
| for
the year than ended; and |
|
|
|
|
| (d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980. |
|
|
|
|
(RIAZ AHMAD &
COMPANY) |
|
| Faisalabad:
Feb 20, 1998 |
|
Chartered Accountants |
|
|
|
|
|
| BALANCE
SHEET AS AT 30 SEPTEMBER 1997 |
|
|
|
|
|
|
(RUPEES IN THOUSAND) |
|
|
|
|
NOTE |
1997 |
1996 |
|
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
|
|
|
|
|
| Authorised
share capital |
|
|
|
|
|
|
|
| 100
000 000 (1996:50 000 000) ordinary shares |
|
| of
Rupees 10 each |
|
|
1 000 000 |
500 000 |
|
|
|
|
========== |
========== |
|
| Issued,
subscribed and paid up share capital |
3 |
368 883 |
335 348 |
|
| Reserves |
|
|
4 |
748 444 |
636 394 |
|
| Unappropriated
profit |
|
625 |
4 393 |
|
|
|
|
|
---------- |
---------- |
|
|
|
1 117 952 |
976 135 |
|
|
|
|
| REDEEMABLE
CAPITAL |
|
5 |
13 000 |
26 000 |
|
| LONG
TERM LOANS |
|
6 |
124 649 |
152 127 |
|
| LIABILITIES
AGAINST ASSETS |
|
|
|
| SUBJECT
TO FINANCE LEASE |
|
7 |
159 386 |
158 630 |
|
| DEFERRED
INCOME ON SALE |
|
|
|
| AND
LEASE BACK OF ASSETS |
|
8 |
221 |
364 |
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
|
|
|
|
| Current
portion of long term liabilities |
9 |
124 040 |
121 038 |
|
| Short
term running finances |
|
10 |
879 406 |
1 141 937 |
|
| Creditors,
accrued and other liabilities |
11 |
467 729 |
261 675 |
|
| Workers'
participation fund |
|
12 |
12 899 |
5 818 |
|
| Provision
for taxation |
|
|
52 101 |
74 683 |
|
| Proposed
dividend |
|
|
46 110 |
|
|
| Unclaimed
dividend |
|
|
1 280 |
1 282 |
|
|
|
|
---------- |
---------- |
|
|
|
|
1 583 565 |
1 606 433 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
13 |
---------- |
---------- |
|
|
|
|
2 998 773 |
2 919 689 |
|
|
|
|
========== |
========== |
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
| Operating
fixed assets |
|
14 |
559 723 |
562 877 |
|
| Assets
subject to finance lease |
|
15 |
255 667 |
263 730 |
|
| Capital
work-in-progress |
|
16 |
12 822 |
4 217 |
|
|
|
|
---------- |
---------- |
