Jubilee Spinning & Weaving Mills Ltd - Annual Reports 2003

Jubilee Spinning & Weaving Mills Limited

Annual Report 2003

Contents

Company Information

Ahmed Shafi

Rizwan Shafi

Salman Rafi

Shams Rafi (Chief Executive)

Shaukat Shafi

Umer Shafi

Usman Shafi

Audit Committee

Rizwan Shafi (Chairman)

Umer Shafi (Member)

Usman Shafi (Member)

Company Secretary

Masood A. Sheikh

Auditors

Anjum Asim Shahid Rahman

Chartered Accountants

Legal Advisers

A. K. Brohi & Co.

Ghani Law Associates

Bankers

Faysal Bank Limited

Habib Bank Limited

National Bank of Pakistan

Bank AI-Habib Limited

Union Bank Limited

Registered Office

40-A, Zafar Ali Road, Gulberg-V,

Lahore-Pakistan.

Mills

B-28, Manghopir Road, S.I.T.E.,

Karachi-Pakistan.

Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the 30th Annual General Meeting of the shareholders of

Jubilee Spinning & Weaving Mills Limited will be held on Saturday the January 31, 2004 at 10:00

a.m. at Registered Office of the Company, 40-A, Off Zafar Ali Road, Gulberg-V, Lahore to transact the

following business:-

1. To receive, consider and adopt the Audited Accounts of the Company for the year ended September

30, 2003 together with the Directors' and Auditors' Reports thereon.

2. To appoint Auditors and fix their remuneration.

By Order Of The Board

Masood A. Sheikh

Corporate Secretary

Registered Office:

40-A, Off: Zafar Ali Road, Gulberg-V, Lahore

T: +92-42-111-245-245

F: +92-42-111-222-245

E: mailho@crescentbahunian.com

Dated: December 29, 2003

NOTE:

1. The Members' Register will remain closed from January 16, 2004 to January 31, 2004 (both days

inclusive). Transfers received at the Registered Office of the Company by the close of business

on January 15, 2004 will be treated in time.

2. A member eligible to attend and vote at this meeting may appoint another member as proxy to

attend and vote in the meeting. 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.

3. Shareholders are requested to immediately notify the change in address, if any.

4. CDC account holders will further have to follow the guidelines as laid down in circular No.l dated

January 26, 2000 issued by the Securities and Exchange Commission of Pakistan:

a. For Attending the Meeting

i). In case of individuals, the account holder or sub-account holder and/or the person whose

securities are in group account and their registration details are uploaded as per the

Regulations, shall authenticate his/her identity by showing his original National Identity Card

(NIC) or original passport at the time of attending the meeting.

ii). In case of corporate entity, the Board of Directors' resolution/power of attorney with specimen

signatures of the nominee shall be produced (unless it has been provided earlier) at the time

of the Meeting

b. For Appointing Proxies

i). In case of individuals, the account holder or sub-account holder and/or the person whose

securities are in group account and their registration details are uploaded as per the

Regulations, shall submit the proxy form as per the above requirement.

ii). The proxy form shall be witnessed by two persons whose names, addresses and NIC numbers

shall be mentioned on the form.

iii). Attested copies of NIC or the passport of the beneficial owners and the proxy shall be

furnished with the proxy form.

iv).The proxy shall produce his original NIC or original passport at the time of the Meeting.

v). In case of corporate entity, the Board of Directors' resolution/power of attorney with specimen

signatures shall be submitted (unless it has been provided earlier) along with proxy form

to the company.

Director's Report To The Shareholders

The Directors of your Company feel pleasure in presenting the annual report and audited financial

statements for the year ended September 30, 2003.

1. Financial Results

Your Company's operations for the year resulted in a post tax Loss of Rupees (31.644). loss per

share is Rupees (4.82).

2. Auditors

The present auditors M/s. Anjum Asim Shahid Rahman Chartered Accountants retire and being

eligible, offer themselves for re-appointment.

3. Review of financial Affairs and Future Prospects

The Chief Executive's Review provides details of the financial affairs and the future prospects of

the Company.

4. Pattern of Shareholding

The pattern of shareholding as required by Section 236 of the Companies Ordinance, 1984 is

attached to this report.

5. Statement pursuant to clause XIX of Corporate Governance

a) The financial statements of the Company present fairly its state of affairs, the results of its

operations, cash flows and changes in equity.

b) Proper books of account of the Company have been maintained.

c) Appropriate accounting policies have been consistently applied in preparation of financial

statements and accounting estimates are based on reasonable and prudent judgment.

d) In preparation of financial statements, International Accounting Standards, as applicable in

Pakistan, have been followed and non-applicability, if any, has been adequately disclosed.

e) The system of internal control is sound in design and is being consistently reviewed by the

internal audit and other procedures and will continue to be reviewed and any weakness in the

system will be eliminated.

f) There are no significant doubts upon the Company's ability to continue as a going concern.

g) There has been no material departure from the best practices of Corporate Governance as

detailed in listing regulations.

h) Key operating and financial data of last six years in a summarized is annexed,

i) Attendance at 4 meetings of the Board of Directors held during the year under review were

as under:

Name of Director

Meetings Attended

Mr. Ahmed Shafi

Mr. Rizwan Shafi

Mr. Salman Rafi

Mr. Shams Rafi

Mr. Shaukat Shafi

Mr. Umer Shafi

Mr. Usman Shafi

j) The Directors, CEO, CFO and Company Secretary, their spouses and minor children carried

out no trading in the shares of the Company.

k) Due to Losses no dividend has been declared.

For and on behalf of the Board of Directors

FINANCIAL RATIOS AT 30TH SEPTEMBER, 2003

2003

2002

2001

2000

1999

1998

Gross Profit / (Loss) Sales

-1.55

-13.41

3.37

-12.87

-19.07

2.75

Operating Profit / (Loss) to Sales

-6.89

-16.67

-16.13

-23.03

-1.99

Pre-tax Profit / (Loss) to Sales

-7.3

-26.66

-11.14

-27.56

-35.28

-14.2

Pre-tax Profit / (Loss) to Capital

-13.26

-20.93

-11.24

-21.64

-28.1

-13.42

Earning / (Loss) per share

Rs.

-4.82

-19.49

-11.75

-22.04

-28.52

-13.96

Bonus issue to capital

Break up value per share

Rs.

-34.01

-63.18

-45.8

-54.58

-24.11

4.41

Debt/Equity Ratio

59/41

Current ratio

0.66:1

0.63:1

0.83:1

Chief Executive Review

It is my pleasure to welcome you to the 30th Annual General Meeting of Jubilee Spinning & Weaving

Mills Limited and present to you the audited financial statement for the year ended September 30, 2003.

This year has seen many changes at the Company, most of which are fully reflected in the financial

statements. Extensive financial restructuring with our major lenders has been completed and ongoing

operational changes have shown their beneficial effects. Underutilized and loss-making assets have been

liquidated and proceeds from this sale have been used to reduce debt and other outstanding liabilities.

Although these positive developments have impacted the bottom line, the Management feels that much

more change is necessary and is continuing to implement its aggressive cost-cutting and quality

improvement strategies. Furthermore, more avenues are being explore to further improve efficiencies,

develop new products and enter new markets.

During the year under review the Company's sales decreased by 21% to Rs. 433.45 million. This was

predominantly due to the sale of our weaving and processing assets which have been major contributors

to our loss in the last few years. Resultantly, gross loss has been reduced by a very substantial 91%

to Rs. 6.709 million. It is important to note that this has been achieved in an environment of increasing

raw material prices and continuing downward pressure on profit margins due to a depressed yarn market.

National Bank of Pakistan (NBP) and Habib Bank Limited (HBL), the Company's main lenders, have

extensively restructured their facilities. In the case of NBP, reconciliation of accounts resulted in a

rectification that has reduced the total liability from Rs. 189.258 million to Rs. 105.430 million. This

remaining liability is payable over the next twelve years, including a grace period of two years. HBL has

given the Company a two year grace, allowing the Management enough time to further improve its

operations without the burden of high financial charges. Both these facilities now carry very competitive