Welcome to PakSearch.com Pakistan's Premier Business Information
Service


For business information, annual reports, laws, ordinances, regulations and articles.




Google
 
Web Paksearch.com
Al-Abid Silk Mills Limited
Annual Report 2000
BOARD OF DIRECTORS
Mr. Naseem A. Sattar Chairman & Chief Executive
Mr. Azim Ahmed Director
Mr. Amir Naseem Director
Mrs. Zarina Naseem Director
Mrs. Sadaf Nadeem Director
Mrs. Reena Azim Director
Mrs. Asra Amir Director
Mr. Nasim Beg Nominee Director (N.I.T.)
Mr. Muhammad Shafi Nominee Director (N.I.T.)
Mr. Muhammad Ashraf Nominee Director (N.I.T.)
SECRETARY
Mr. S. M. Jawed Azam
AUDITORS
Muniff Ziauddin & Company
Chartered Accountants
REGISTRARS
(a) Adam Patel & Co. (Pvt.) Ltd.
34 / 2 - F, Block - 5, Clifton, Karachi.
(b) Gangjees Associates (For C.D.C. Purpose)
516, Clifton Centre, Khayaban-e-Roomi,
Kehkashan, Block- 5, Clifton, Karachi.
BANKERS
Habib Bank Limited
Habib Bank A. G. Zurich
Citibank, N.A.
National Bank of Pakistan
Deutsche Bank
Metropolitan Bank Limited
REGISTERED OFFICE
A - 39, S.I.T.E.,
Manghopir Road, Karachi.
MILLS
A - 39,
A-51 /B,
A- 34/A,
D-14/C-1
S.I.T.E., Karachi.
CONTENTS
Notice of Annual General Meeting
Report of Directors
Auditor's Report to the Members
Balance Sheet
Profit & Loss Account
Cash Flow Statement
Notes to the Accounts
Pattern of Shareholdings
NOTICE OF MEETING
Notice is hereby given that the 32nd Annual General Meeting of the shareholders of the Company will be held at the
Hotel Regent Plaza, Karachi on Saturday, December 23, 2000 at 3.30 p.m. to transact the following business:
1. To confirm the minutes of the 31st Annual General Meeting of the Company held on December 28, 1999.
2. To receive, consider and adopt the audited accounts of the Company together with the Directors' and Auditors' reports
thereon for the year ended on June 30, 2000.
3. To approve payment of Final Cash Dividend at Rs. 3.00 per share to the shareholders for the year ended on June
30, 2000.
4. To appoint Auditors and fix their remuneration.
5. To approve remuneration of the Directors.
6. To elect eight Directors as fixed by the Board for a term of 3 years in accordance with Section 178 of the Companies
Ordinance 1984.
The names of retiring Directors are Messrs Naseem A. Sattar, Azim Ahmed, Amir Naseem, Mrs. Zarina Naseem,
Mrs. Sadaf Nadeem, Mrs. Reena Azim and Mrs. Asra Amir.
The following persons being eligible offer themselves for election of Directors U/S 178 of the Companies Ordinance
1984.
i. Mr. Naseem A. Sattar
ii. Mr. Azim Ahmed
iii. Mr. Amir Naseem
iv. Mrs. Zarina Naseem
v. Mst. Adia Naseem
vi. Mrs. Sadaf Nadeem
vii. Mrs. Reena Azim
viii. Mrs. Asra Amir
The nominee Directors of NIT appointed U/S 183 are not subject to retirement and they continue to be the nominee
Directors of NIT on the Board of the Company under Section 183 of the Companies Ordinance 1984.
7. To consider any other business with the permission of the Chair.
BY ORDER OF THE BOARD
(S. M. JAWED AZAM)
Karachi: 27th November, 2000. Company Secretary
NOTES:
1. The Share Transfer Books of the Company will remain closed from December 19, 2000 to December 31, 2000 (both days
inclusive).
2. A member entitled to attend and vote at this meeting may appoint another member as his/her proxy to attend and vote
instead of him/her. Proxies, in order to be effective, must be received at the Registered Office of the Company not less
than 48 hours before the time of meeting.
3. Members are requested to promptly notify the Company of any change in their addresses.
CDC Account Holders will further have to follow the under mentioned guidelines as laid down in Circular I 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 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 signature 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 requirements.
(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 signature shall be
submitted (unless it has been provided earlier) alongwith proxy form to the Company.
THIRTY-SECOND ANNUAL REPORT OF THE DIRECTORS
Dear Shareholders,
WELCOME: I welcome you to the 32nd Annual General Meeting of the Company.
PREAMBLE: The accounts for the year are before you indicating the performance of the Company
which will be discussed further in the following.
PERFORMANCE: You will note that the total sales of the Company compared to the preceding
year have reduced by approximately 3.81%. In spite of growing competition in the international
market, we have been able to maintain the export sales. The decrease is attributed mainly to local
processing for outside parties which was reported to you already earlier. The profit for the year
compared to the preceding year indicates a drop which is largely attributed to the exchange rate
between European Currency and Pakistani Rupee. The European Currency has been depleting
against the Dollar, accordingly against Rupee continuously after October 1999. The Deutsche Mark
was giving Rupee yield in October 1999 of around Rs. 28.74 and in the subsequent half year, it
touched the bottom to around Rs. 23.40. This position of exchange rate had two effects on the
business activities of the Company. On one side the profit was reduced as yield in Rupee vis-a-vis
European currency kept on reducing continuously. On the other hand new inflow of orders
which would have helped in increasing the sales also retarded as due to the exchange rate for new
orders, prices appeared to be higher for the European buyers. However, things are now gradually
settling and we hope that the setback due to the rate of exchange in the preceding year shall be
absorbed to a sizeable extent in the months to come. As reported to you also earlier, there is
hardly any demand of fabric in the international market, practically everything is exported in
the form of made-ups, i.e. stitched articles. To be able to stay in the international market, full
attention was given and reported to you on providing stitching facilities to the Company on modern
lines. In the present scenario, this has enabled us to stay with our turnover in the international
market but at the same time it has increased our stitching expenses as fabric export practically has
been replaced by made-ups. In pursuit of expanding export all efforts are being made to open new
markets. The Company has made entry in some new markets and it is hoped that with the entry in
new markets in the years to come, the export sales would increase substantially provided nothing
of extraordinary nature occurs internally or externally, having negative effect.
As mentioned above, the Company will continue to pursue its export expanding policy and in
keeping with this policy also in the year under discussion wherever it was required the stitching
facilities have been expanded.
DIVIDEND: Profit after tax for the year as you will note is Rs. 42.293 million. We therefore propose
Cash Dividend of Rs. 3.00 per share which works out to 42.13% cash distribution of the profit after
tax for the year.
REMUNERATION: The remuneration of Directors is proposed to be increased by 35%.
PATTERN OF SHAREHOLDING: The pattern of shareholding as on June 30, 2000 is included in this
Annual Report.
EARNING PER SHARE: The earning per share has been given in note 32 to the accounts.
ACKNOWLEDGEMENT: In the end your Directors express recognition for the efforts put in by the
workers, staff and executives of the Company. We also acknowledge the cooperation extended by
our banks and financial institutions. At the same time, we also thank for the well wishes of our
valued shareholders.
Thanks to all of you. For and on behalf of the Board of Directors
NASEEM A. SATTER
Karachi: 27th November, 2000. Chairman & Managing Director
AUDITORS' REPORT TO THE MEMBERS
We have audited the annexed balance sheet of AL-ABID SILK MILLS LIMITED as at 30 June 2000
and the related profit and loss account, cash flow statement and statement of changes in equity 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.
It is the responsibility of the company's management to establish and maintain a system of internal
control, and prepare and present the above said statements in conformity with the approved accounting
standards and the requirements of the Companies Ordinance, 1984. Our responsibility is to express an
opinion on these statements based on our audit.
We conducted our audit in accordance with the auditing standards as applicable in Pakistan. These
standards require that we plan and perform the audit to obtain reasonable assurance about whether the
above said statements are free of any material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the above said statements. An audit also
includes assessing the accounting policies and significant estimates made by management, as well as,
evaluating the overall presentation of the above said statements. We believe that our audit provides a
reasonable basis for our opinion and, after due verification, 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 and profit and loss account and cash flow statement together
with the notes forming part thereof conform with approved accounting standards as
applicable in Pakistan, and, 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 June 2000 and of the profit, its cash flows and changes in equity for the year
then ended; and
(d) in our opinion Zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of
1980), was deducted by the company and deposited in the Central Zakat Fund established
under section 7 of that Ordinance.
MUNIFF ZIAUDDIN & CO.
KARACHI: 27th November, 2000. Chartered Accountants
BALANCE SHEET AS AT JUNE 30, 2000
Note 2000 1999
Rupees Rupees
SHARE 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 3 59,400,000 59,400,000
Reserves
Capital reserve 4 39,600,000 39,600,000
Unappropriated profit 202,156,974 177,683,401
------------------ ------------------
241,756,974 217,283,401
------------------ ------------------
5 301,156,974 276,683,401
LONG TERM LOANS 6 64,543,639 67,990,889
LIABILITIES AGAINST ASSETS SUBJECT
TO FINANCE LEASE 7 46,453,458 56,872,100
DEFERRED LIABILITIES 8 15,536,013 14,426,470
CURRENT LIABILITIES AND PROVISIONS
Short term finances 9 692,901,199 644,434,723
Current maturity of long-term loans and finances 10 19,151,063 24,692,859
Creditors, accrued charges and other liabilities 11 374,065,360 357,698,018
Dividends 12 17,882,750 23,838,546
------------------ ------------------
1,104,000,372 1,050,664,146
CONTINGENCIES AND COMMITMENTS 13 -- --
------------------ ------------------
1,531,690,456 1,466,637,006
========== ==========
The annexed notes form an integral part of these accounts.
Karachi: 27th November, 2000.
FIXED CAPITAL EXPENDITURE
Operating fixed assets 14 459,192,215 451,281,212
Capital work-in-progress 15 -- 5,030,190
------------------ ------------------
459,192,215 456,311,402
ADVANCE FOR SHARES 16 1,028,745 1,027,545
LONG TERM DEPOSITS, PREPAYMENTS
AND DEFERRED COST 17 2,070,454 2,356,905
CURRENT ASSETS
Stores and spares 18 70,342,442 65,717,491
Stock-in-trade 19 804,514,728 760,089,635
Trade debtors 20 30,617,386 27,804,589
Advances, deposits and prepayments 21 49,957,656 68,455,904
Other receivables 22 76,732,648 59,968,156
Cash and bank balances 23 37,234,182 24,905,379
------------------ ------------------
1,069,399,042 1,006,941,154
------------------ ------------------
1,531,690,456 1,466,637,006
========== ==========
NASEEM A. SATTAR AZIM AHMED
Chairman & Chief Executive Director
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED JUNE 30, 2000
Note 2000 1999
Rupees Rupees
Sales and services 24 1,601,685,525 1,665,150,607
Cost of sales 25 1,348,117,347 1,410,141,328
------------------ ------------------
GROSS PROFIT 253,568,178 255,009,279
OPERATING EXPENSES
Administrative 26 63,909,066 60,042,482
Selling and distribution 27 35,928,972 34,446,387
------------------ ------------------
99,838,038 94,488,869
------------------ ------------------
OPERATING PROFIT 153,730,140 160,520,410
Other income 28 3,435,269 3,205,680
------------------ ------------------
157,165,409 163,726,090
------------------ ------------------
Financial charges 29 102,746,205 94,786,242
Other Charges 30 2,720,960 3,446,992
------------------ ------------------
105,467,165 98,233,234
------------------ ------------------
Profit before taxation 51,698,244 65,492,856
Taxation 31 (9,404,671) (10,020,931)
------------------ ------------------
Profit after taxation 42,293,573 55,471,925
Unappropriated profit brought forward 177,683,401 145,971,476
------------------ ------------------
219,976,974 201,443,401
APPROPRIATION
Proposed dividend Rs. 3.00 per share 17,820,000 23,760,000
(1999: Rs. 4.00 per share)
------------------ ------------------
Unappropriated profit carried forward 202,156,974 177,683,401
========== ==========
Basic Earning Per Share 32 7.12 9.34
========== ==========
The annexed notes form an integral part of these accounts.
NASEEM A. SATTAR AZIM AHMED
Chairman & Chief Executive Director
CASH FLOW STATEMENT FOR THE YEAR ENDED JUNE 30, 2000
2000 1999
Rupees Rupees
CASH FLOW FROM OPERATING ACTIVITIES
FUNDS PROVIDED FROM OPERATION
Profit after taxation 42,293,573 55,471,925
Adjustment of items not involving movement of funds
Depreciation 50,756,030 49,879,635
Provision for gratuity - net 172,416 2,310,083
Provision for deferred tax 937,127 --
Profit on disposal of fixed assets (1,896,872) (896,193)
------------------ ------------------
92,262,274 106,765,450
(INCREASE) / DECREASE IN CURRENT ASSETS
Stores and spares (4,624,951) (16,866,809)
Stock-in-trade (44,425,093) (158,543,345)
Trade debtors (2,812,797) 15,617,519
Advances, deposits and prepayments 18,498,248 (16,852,303)
Other receivables (16,764,492) 39,665,944
------------------ ------------------
(50,129,085) (136,978,994)
INCREASE / (DECREASE) IN CURRENT LIABILITIES
Short term finances 48,466,476 168,998,148
Creditors, accrued charges and other liabilities 16,367,342 (18,549,963)
------------------ ------------------
64,833,818 150,448,185
------------------ ------------------
NET CASH INFLOW FROM OPERATING ACTIVITIES 106,967,007 120,234,641
CASH FLOW FROM INVESTING ACTIVITIES
Advance for shares (1,200) (3,000)
Capital expenditure (54,911,956) (151,291,901)
Proceeds from disposal of fixed assets 3,171,985 2,136,254
Long term deposits and deferred cost 286,451 (721,450)
------------------ ------------------
NET CASH (OUTFLOW) FROM INVESTING ACTIVITIES (51,454,720) (149,880,097)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from obligation under finance lease 11,451,176 72,845,450
Payments of obligation under finance lease (27,411,614) (27,148,482)
Long term loans acquired (3,447,250) (652,018)
Dividends paid (23,775,796) (4,628,867)
------------------ ------------------
NET CASH (OUTFLOW)/INFLOW FROM FINANCING ACTIVITIES (43,183,484) 40,416,083
------------------ ------------------
NET INCREASE IN CASH AND CASH EQUIVALENTS 12,328,803 10,770,627
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 24,905,379 14,134,752
------------------ ------------------
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 37,234,182 24,905,379
========== ==========
NASEEM A. SATTAR AZIM AHMED
Chairman & Chief Executive Director
NOTES TO THE ACCOUNTS FOR THE YEAR ENDED JUNE 30, 2000
1. COMPANY AND ITS BUSINESS
The company was incorporated in the year 1968 as a Private Limited Company and was converted
into Public Limited Company on 24th December, 1987 under the Companies Ordinance, 1984. The
Company is listed on the Karachi and Lahore Stock Exchanges. The principal activity of the
Company is manufacturing and processing of various kinds of fabrics and export of printed and dyed
cloth, bed sets and garments made-up.
2. ACCOUNTING POLICIES
2.1 ACCOUNTING CONVENTION
These accounts have been prepared on the basis of "historical cost" convention.
2.2 STAFF GRATUITY
The Company operates an unfunded gratuity scheme covering all employees (excluding
managerial staff). Full provision is made in these accounts for gratuity payable to employees
as per law.
2.3 TAXATION
Current
Provision for the year is based on taxable income at the current rates of taxation after taking
into account tax credit and rebates, if any.
Deferred
The Company accounts for deferred taxation on all major timing differences using the liability
method. However, deferred tax is not provided if it can be established with reasonable
probability that the timing differences will not reverse in the foreseeable future.
2.4 FIXED CAPITAL EXPENDITURE AND DEPRECIATION
a. Operating fixed assets are stated at cost less accumulated depreciation except land
and capital work-in-progress which are stated at cost.
b. Depreciation is charged to income applying the reducing balance method without
considering extra shifts worked.
c. No depreciation is charged on assets disposed off during the year while charge for the
full year is made on additions during the year.
d. Minor renewals, replacements, maintenance and repairs are charged to expense.
Major renewals and betterments are capitalized. Gains and losses on deleted assets
are reflected in the accounts.
2.5 ACCOUNTING FOR LEASES
The Company records assets acquired under finance lease and related liabilities at lower of
present value of minimum lease payments under the lease agreement and the fair value of
assets. Finance charges are allocated to accounting period in a manner so as to produce
a constant periodic rate of charge on the outstanding liability. Depreciation is provided at the
rates applicable to operating fixed assets.
2.6 CAPITALIZATION OF BORROWING COST
Borrowing cost on loans obtained for acquisition of plant and machinery for the period till
commissioning of production is capitalized.
2.7 STORES AND SPARES
These are valued at cost using the moving average method.
2.8 STOCK-IN-TRADE
Stock of raw materials, work-in-process and finished goods are valued at lower of moving
average cost and net realizable value. Cost in relation to work-in-process and finished goods
represents direct cost of materials, direct wages and an appropriate portion of production
overheads.
Items in transit are valued at cost comprising invoice values plus other charges paid thereon.
2.9 INVESTMENTS
These are valued at cost.
2.10 FOREIGN CURRENCY TRANSACTIONS
Transactions in foreign currencies are converted into rupees at the rates of exchange
prevailing on the date of transaction. Exchange gains and losses are included in income
currently.
2.11 REVENUE RECOGNITION
Sale of goods and services are recognized on despatch of goods to customers or on the
performance of services.
2000 1999
Rupees Rupees
3. ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
Ordinary Shares of Rs. 10/- each
3,160,000 Issued for cash 31,600,000 31,600,000
2,780,000 Issued as bonus shares 27,800,000 27,800,000
------------------ ------------------ ------------------
5,940,000 59,400,000 59,400,000
========== ========== ==========
4. CAPITAL RESERVE
Premium on Right Shares 39,600,000 39,600,000
========== ==========
5. STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED JUNE 30, 2000
Share Share Unappropriated Total
Capital Premium Profit
Balance as at June 30, 1998 59,400,000 39,600,000 145,971,476 244,971,476
Profit after tax for the year
ended June 30, 1999 -- -- 55,471,925 55,471,925
Dividend -- -- (23,760,000) (23,760,000)
------------------ ------------------ ------------------ ------------------
Balance as at June 30, 1999 59,400,000 39,600,000 177,683,401 276,683,401
Profit after tax for the year
ended June 30, 2000 -- -- 42,293,573 42,293,573
Dividend -- -- (17,820,000) (17,820,000)
------------------ ------------------ ------------------ ------------------
Balance as at June 30, 2000 59,400,000 39,600,000 202,156,974 301,156,974
========== ========== ========== ==========
2000 1999
Rupees Rupees
6. LONG TERM LOANS
Director's Loan
Mr. Naseem A. Sattar 64,543,639 67,990,889
========== ==========
No mark-up has been charged on the above loan.
7. LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE
Balance as at 30-06-2000 (1999: 30-06-1999) 65,604,521 81,564,959
Payable within the following twelve months (19,151,063) (24,692,859)
------------------ ------------------
46,453,458 56,872,100
========== ==========
7.1 The amounts of future payments and the periods during which they will fall due are:
Year ending 30th June
2000-2001 (1999: 1999-2000) 30,826,215 39,358,157
2001 - 2004 (1999: 1999 - 2004) 59,537,501 79,056,676
------------------ ------------------
90,363,716 118,414,833
Less: Finance charges not yet due 24,759,195 36,849,874
------------------ ------------------
65,604,521 81,564,959
========== ==========
Classified as under:
Long term obligation 46,453,458 56,872,100
Current obligation 19,151,063 24,692,859
------------------ ------------------
65,604,521 81,564,959
========== ==========
7.2 Payments under leases includes financial charges at the rates ranging between 19.50% and
21.50% per annum.
Leases carry renewal option at the end of the lease period. There are no financial restrictions in
the lease agreements.
8. DEFERRED LIABILITIES
Staff and workers gratuity 14,598,886 14,426,470
Deferred Taxation 937,127 --
------------------ ------------------
15,536,013 14,426,470
========== ==========
9. SHORT TERM FINANCES
Finance utilized under mark-up arrangement (9.1) 23,176,978 --
Export Refinance I- H.B.L. (9.2) -- 129,792,052
Export Refinance II - H.B.L. (9.2) 485,000,000 305,000,000
Export Refinance I - Citi Bank (9.3) 39,978,900 39,542,000
Export Refinance II - Citi Bank (9.3) 50,000,000 50,000,000
Export Refinance I - H.B. AG Zurich (9.4) -- 9,895,000
Export Refinance II- H.B. AG Zurich (9.4) 60,000,000 50,000,000
FIM account (9.5) 22,744,685 30,505,974
Cash Finance Account (9.5) 12,000,636 29,699,697
------------------ ------------------
692,901,199 644,434,723
========== ==========
9.1 The finance has been obtained from Habib Bank Limited on mark-up basis at the rate of 48 paisas
(1999: at the rate of 48 Paisas) per thousand per day.
The arrangement is secured against equitable mortgage of Plot No. A - 51 / B with building and
machinery thereon and hypothecation of stocks.
9.2 The loan is secured against different contracts / LCs of Export and hypothecation of Stocks.
9.3 These loans are provided by banks on the basis of past Export performance determined by State
Bank of Pakistan and is secured against charge on Trade Debtors.
9.4 These loans are provided by banks on the basis of past Export performance determined by State
Bank of Pakistan and is secured against legal and equitable mortgage of plot No. A - 34/A with
building and machinery installed thereon.
9.5 These are secured against pledge of stocks and stores.
10. CURRENT MATURITY OF LONG-TERM LOANS AND FINANCES
Liabilities against assets subject to finance lease 19,151,063 24,692,859
========== ==========
11. CREDITORS, ACCRUED CHARGES AND OTHER LIABILITIES
Trade creditors 124,175,773 73,299,653
Other creditors 47,072,264 40,282,568
Accrued liabilities 16,823,680 17,720,248
Workers' profit participation fund (11.1) 6,267,251 6,840,185
Workers' welfare fund -- 13,890
Deposits from contractors (11.2) 1,799,335 882,485
Due to associated undertakings -- 2,663,549
Bills payable under D/A 162,306,953 210,385,536
Mark-up accrued on export refinance loan 13,199,201 3,278,823
Mark-up accrued on Cash credit, FIM & Running Finance 895,115 1,077,789
Mark-up accrued on Lease finance 718,034 901,072
Advance from customers 452,669 --
Other liabilities 355,085 352,220
------------------ ------------------
374,065,360 357,698,018
========== ==========
11.1 Workers' profit participation fund
Opening balance 6,840,185 6,870,910
Interest on W.P.P.F. 153,098 358,983
------------------ ------------------
6,993,283 7,229,893
Paid during the year 3,446,992 3,836,700
------------------ ------------------
3,546,291 3,393,193
Provision for the year 2,720,960 3,446,992
------------------ ------------------
6,267,251 6,840,185
========== ==========
Interest is charged @ 10.50% (1999: 10.50%) per annum on outstanding balance.
1i.2 This represents 7% security deposits retained from contractors bills.
12. DIVIDENDS
Unclaimed 62,750 78,546
Proposed 17,820,000 23,760,000
------------------ ------------------
17,882,750 23,838,546
========== ==========
13. CONTINGENCIES AND COMMITMENTS
13.1 Outstanding liabilities under documentary credit 9,876,100 23,646,700
========== ==========
13.2 Income tax demands relating to the assessment year 1997- 1998 to 1999- 2000 not accepted
by the company, currently under appeal amounted to Rs. 6.37 million. The management of the
company is confident that on merits of the case the final outcome will be in favour of the Company,
therefore no provision has been made in these accounts.
14. STATEMENT OF OPERATING FIXED ASSETS
COST AS AT ADDITIONS/ COST AS AT ACCUMULATED CHARGE ACCUMULATED WRITTEN RATE
01-07-1999 (DELETIONS) 30-06-2000 DEPRECIATION FOR THE DEPRECIATION DOWN VALUE %
*ADJUSTMENTS AS AT YEAR/ AS AT AS AT
01-07-1999 (DELETIONS)/ 30-06-2000 30-06-2000
*ADJUSTMENTS
Rs.  Rs.  Rs.  Rs.  Rs.  Rs.  Rs. 
Land - Leasehold 16,408,214 -- 16,408,214 -- -- -- 16,408,214 --
Buildings on leasehold land 135,455,559 18,132,411 153,587,970 51,763,031 10,182,494 61,945,525 91,642,445 10
Plant, machinery and
equipments 401,620,116 13,964,367 444,199,989 221,672,116 21,426,161 251,364,544 192,835,445 10
(4,784,494) (3,952,638)
*33,400,000 *12,218,905
Furniture, fixtures and
ancillary equipments 36,229,625 8,792,388 45,022,013 13,186,389 3,183,562 16,369,951 28,652,062 10
Office equipments 14,370,226 2,077,723 16,407,949 5,359,734 1,106,696 6,447,688 9,960,261 10
(40,000) (18,742)
Electric, gas and other
installations 37,358,439 4,544,790 41,903,229 16,246,786 2,565,644 18,812,430 23,090,799 10
Vehicles 21,855,541 979,291 21,464,012 13,211,487 1,840,269 14,102,935 7,361,077 20
(1,370,820) (948,821)
------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Sub Total 663,297,720 48,490,970 738,993,376 321,439,543 40,304,826 369,043,073 369,950,303
(6,195,314) (4,920,201)
*33,400,000 *12,218,905
------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------
ASSETS UNDER FINANCE LEASE
Machinery 137,050,000 9,223,176 112,873,176 30,217,885 9,487,420 27,486,400 85,386,776 10
*(33,400,000) *(12,218,905)
Vehicles 3,404,450 2,228,000 5,632,450 813,530 963,784 1,777,314 3,855,136 20
------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Sub Total 140,454,450 11,451,176 118,505,626 31,031,415 10,451,204 29,263,714 89,241,912
*(33,400,000) *(12,218,905)
------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------
TOTAL 2000 803,752,170 59,942,146 857,499,002 352,470,958 50,756,030 398,306,787 459,192,215
(6,195,314) (4,920,201)
========== ========== ========== ========== ========== ========== ========== ==========
TOTAL 1999 639,311,095 166,556,589 803,752,170 303,468,776 49,879,635 352,470,958 451,261,212
(2,117,514) (877,453)
========== ========== ========== ========== ========== ========== ========== ==========
2000 1999
Rupees Rupees
14.1 The depreciation charge for the year has been allocated as follows:
Factory over head (25.2) 44,924,805 44,697,663
Administrative (26) 5,831,225 5,181,972
------------------ ------------------
50,756,030 49,879,635
========== ==========
14.2 DISPOSAL OF FIXED ASSETS
Cost Accumulated Written Sale Profit/ Mode of Particulars of
Depreciation Down Value Proceeds (Loss) Disposal Purchaser
Rs. Rs. Rs. Rs. Rs.
VEHICLES
Suzuki Mehran 170,000 147,183 22,817 125,000 102,183 Insurance EFU General insurance Ltd.
(REGD. NO. F - 8648) claim
Suzuki Mehran 331,790 66,358 265,432 331,790 66,358 Insurance EFU General Insurance Ltd.
(REGD. NO. ACE - 582) claim
Toyota Corolla 585,000 522,186 62,814 127,119 64,305 Negotiation Mr. Bilal A. Shaikh
(REGD. NO. L - 3301) C-19, Nazir Bungalows, Gulisten-e-Jauhar,
Karachi.
Mazda 92,500 90,834 1,666 112,288 110,622 Negotiation Mr. M. Aslam & Bros.
(REGD. NO. JX - 0814) SC-3, Chandni Chowk,
Main University Road, Karachi.
Toyota Coaster 72,330 71,796 534 112,288 111,754 Negotiation Mr. M. Aslam & Bros.
(REGD. NO. JX - 0612) SC-3, Chandni Chowk,
Main University Road, Karachi.
Honda CD- 70 60,200 21,672 38,528 58,000 19,472 Insurance EFU General Insurance Ltd.
(REGD. NO. KAR - 3613) claim
Honda CD- 70 59,000 28,792 30,208 501000 19,792 Insurance EFU General Insurance Ltd.
(REGD. NO. KCC - 1656) claim
MACHINERY
Rotary Printing Machine 4,163,726 3,572,427 591,299 2,000,000 1,408,701 Negotiation M/s. Magna Textile Industries (Pvt) Ltd.
P-15, Rail Bazar, Jaranwala,
Faisalabad.
Steam Ager 542,768 309,124 233,644 240,000 6,356 Negotiation Mr. Mohd Babar Khan
AF 84 Al-Fateh Colony, Bara Board,
Karachi.
Steam Ager 78,000 71,087 6,913 10,000 3,087 Negotiation Mr. Mohd Babar Khan
AF 84 Al-Fateh Colony, Bara Board,
Karachi.
OFFICE EQUIPMENT
Fax Machine WE 150 40,000 18,742 21,258 5,500 (15,758) Negotiation M/s. Jaffer Brothers (Pvt) Ltd.
Jaffer Chambers, 27 Abdullah Road,
Karachi.
------------------ ------------------ ------------------ ------------------ ------------------
TOTAL 6,195,314 4,920,201 1,275,113 3,171,985 1,896,872
========== ========== ========== ========== ==========
2000 1999
Rupees Rupees
15. CAPITAL WORK-IN-PROGRESS
Building and civil works -- 5,030,190
========== ==========
16. ADVANCE FOR SHARES 1,028,745 1,027,545
========== ==========
This represents advance for shares paid to Sattar Spinning Limited, an associated company. However
no shares were issued to the Company till the date of reporting the balance sheet.
17. LONG TERM DEPOSITS, PREPAYMENTS AND DEFERRED COST
Deposits
Security deposits 2,070,454 1,676,905
Deposits against lease -- 680,000
------------------ ------------------
2,070,454 2,356,905
========== ==========
18. STORES AND SPARES
Stores 20,346,690 18,492,647
Spares 49,995,752 47,224,844
------------------ ------------------
70,342,442 65,717,491
========== ==========
19. STOCK-IN-TRADE
Raw materials 379,012,515 285,767,272
Work-in-process 295,036,346 402,534,915
Finished goods 130,465,867 71,787,448
------------------ ------------------
804,514,728 760,089,635
========== ==========
20. TRADE DEBTORS
Secured 8,957,278 20,400,532
Unsecured- considered good 21,660,108 7,404,057
------------------ ------------------
30,617,386 27,804,589
========== ==========
Trade debts includes due from associated undertakings amounting to Rs. 13.14 million (1999: Nil)
21. ADVANCES, DEPOSITS AND PREPAYMENTS
Advances
To staff and workers 1,777,756 1,781,713
Income tax 18,669,627 36,236,786
Against import expenses 5,532,367 9,144,452
For supplies and expenses 8,465,062 8,613,212
Deposits 5,657,685 4,893,995
Prepayments 9,855,159 7,785,746
------------------ ------------------
49,957,656 68,455,904
========== ==========
22. OTHER RECEIVABLES
Duty drawback 46,140,093 28,673,856
Sales tax 28,724,640 28,845,571
Export Development Surcharge 577,908 1,009,408
Others 1,290,007 1,439,321
------------------ ------------------
76,732,648 59,968,156
========== ==========
23. CASH AND BANK BALANCES
Cash in hand 334,632 1,480,197
Cash with banks - saving account 16,483,051 8,413,347
- current account 19,411,851 14,007,187
P.L.S. TDRs 1,004,648 1,004,648
------------------ ------------------
37,234,182 24,905,379
========== ==========
24. SALES AND SERVICES
Sales
Export sales 1,496,485,491 1,497,166,174
Local sales 53,256,037 48,238,645
------------------ ------------------
1,549,741,528 1,545,404,819
Services
Cloth processing - Printing and dyeing 63,301,659 137,292,074
Stitching - Bedsets, Curtains and Garments 6,000,720 5,619,129
------------------ ------------------
69,302,379 142,911,203
------------------ ------------------
1,619,043,907 1,688,316,022
Less: Commission and brokerage 17,358,382 23,165,415
------------------ ------------------
1,601,685,525 1,665,150,607
========== ==========
25. COST OF SALES
Cost of materials consumed (25.1) 1,054,983,331 1,240,787,514
Salaries and wages 90,561,991 93,557,329
Factory overheads (25.2) 258,876,582 270,299,820
------------------ ------------------
1,404,421,904 1,604,644,663
Work-in-process
Opening stock 402,534,915 287,207,775
Closing stock (295,036,346) (402,534,915)
------------------ ------------------
107,498,569 (115,327,140)
------------------ ------------------
Cost of goods manufactured 1,511,920,473 1,489,317,523
Finished goods
Opening stock 71,787,448 69,756,125
Closing stock (130,465,867) (71,787,448)
------------------ ------------------
(58,678,419) (2,031,323)
------------------ ------------------
1,453,242,054 1,487,286,200
Less: Duty Drawback 105,124,707 77,144,872
------------------ ------------------
1,348,117,347 1,410,141,328
========== ==========
25.1 Cost of Materials Consumed
Dyes and chemicals 186,545,265 260,337,567
Production stores and Packing material 102,624,505 92,742,719
Grey cloth 765,157,112 884,320,020
Finished cloth 656,449 3,387,208
------------------ ------------------
1,054,983,331 1,240,787,514
========== ==========
25.2 Factory Overheads
Insurance premium 5,947,748 5,071,313
Repairs and maintenance 17,482,521 21,455,469
Rent, rates and taxes 2,666,919 3,425,508
Heat, light and power 88,916,991 99,629,027
Water consumption charges 8,991,882 9,177,819
Boiler expenses 908,523 941,513
Service charges 2,318,673 6,820,779
Checking, mending, stitching and packing charges 5,406,710 5,597,208
Coolie, cartage and freight 39,993,733 40,676,062
Cloth cutting and stitching charges 41,318,077 32,807,459
Depreciation 44,924,805 44,697,663
------------------ ------------------
258,876,582 270,299,820
========== ==========
26. ADMINISTRATIVE EXPENSES
Directors' remuneration 4,903,956 3,692,010
Salaries and benefits 18,449,105 18,068,921
Staff welfare 1,245,804 1,518,881
Electric charges 4,634,913 4,955,333
Travelling 9,683,592 7,366,317
Car maintenance 5,913,237 5,441,692
Conveyance 170,071 191,343
Entertainment 1,083,976 1,064,750
Printing and stationery 2,421,249 2,720,762
Postage, telegram, telephone and telex 3,687,009 3,373,752
Legal and professional 1,604,424 1,971,915
Auditors' remuneration (26.1) 85,000 85,000
Advertisement 451,290 555,495
Subscription and fees 1,214,776 1,219,953
Charity and donation (26.2) 18,000 280,868
Insurance premium 1,936,771 1,899,901
Service contracts 385,656 204,352
Miscellaneous 189,012 249,265
Depreciation 5,831,225 5,181,972
------------------ ------------------
63,909,066 60,042,482
========== ==========
26.1 Auditors' remuneration
Audit fee 85,000 85,000
========== ==========
26.2 Charity and donation
None of the Directors or their spouses had any interest in donee's fund.
27. SELLING AND DISTRIBUTION EXPENSES
Packing and forwarding 14,354,805 16,618,057
Publicity 7,888,634 7,957,766
Samples lab testing and other charges 1,893,317 1,013,458
Postage, courier and stamps 6,624,571 3,868,106
Entertainment 925,369 864,295
Export development tax 4,242,276 4,124,705
------------------ ------------------
35,928,972 34,446,387
========== ==========
28. OTHER INCOME
Sales of scrap 1,071,903 1,384,759
Profit / (Loss) on Sale of Stocks (58,343) --
Profit on TDRs 524,837 924,728
Profit on disposal of fixed assets 1,896,872 896,193
------------------ ------------------
3,435,269 3,205,680
========== ==========
29. FINANCIAL CHARGES
Bank charges, mark-up and commission 25,279,573 28,781,166
Mark-up on cash credit account 4,563,795 4,807,460
Mark-up on F IM account 4,072,281 6,372,510
Mark-up on short term running finance 2,574,568 3,758,894
Mark-up on export refinance loans 50,874,416 40,017,141
Lease finance charges 15,228,474 10,690,088
Interest on W.P.P.F. 153,098 358,983
------------------ ------------------
102,746,205 94,786,242
========== ==========
30. OTHER CHARGES
Workers' profit participation fund 2,720,960 3,446,992
========== ==========
31. TAXATION
Current 8,418,828 8,619,001
Prior 48,716 1,401,930
------------------ ------------------
8,467,544 10,020,931
Deferred 937,127 --
------------------ ------------------
9,404,671 10,020,931
========== ==========
32. BASIC EARNING PER SHARE
Profit after tax      42,293,573 55,471,925
========== ==========
Number of Shares  5,940,000 5,940,000
========== ==========
Basic Earning Per Share  7.12 9.34
========== ==========
33. REMUNERATION OF DIRECTORS AND EXECUTIVES
CHIEF EXECUTIVE DIRECTORS EXECUTIVES
2000 1999 2000 1999 2000 1999
Remuneration  2,126,184 1,600,722 1,255,860 945,492 12,163,336 8,373,322
House rent 956,784 720,330 565,128 425,466 4,607,069 3,474,646
Utilities -- -- -- -- 854,119 368,764
------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Number of persons 1 1 2 2 68 57
========== ========== ========== ========== ========== ==========
33 (i) The Chief Executive and Directors are provided with free use of the company maintained
cars and residential telephones for business and personal use, certain executives are also
provided with free use of Company maintained cars.
33 (ii) REMUNERATION TO OTHER DIRECTORS
Aggregate amount charged in the accounts for Board Meeting fee to non - executive
Directors was Rs. 38,000/- (1999: Rs. 36,500).
33 (iii) Number of Employees as at June 30, 2000 were 1,159 (1999: No. 1,186)
34. TRANSACTIONS WITH ASSOCIATED UNDERTAKINGS
The maximum aggregate amount due from associated undertakings at the end of any month during the
year was Rs. 21,577,176/- (1999: Rs. 10,578,188).
2000 1999
Rupees Rupees
Sales, processing charges, services and charges recovered 64,408,893 60,329,764
Purchases, services and charges 656,449 3,387,208
35. FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES
Interest/mark-up rate risk exposure
The company's exposure to interest / mark-up rate risk and the effective rates on its financial assets and liabilities as at June 30, 2000 are
summarized as follows:
(i) Financial assets and liabilities
Interest/Mark-up bearing Non-Interest/Mark-up bearing Total
Maturity Maturity Sub-total Maturity Maturity Sub-total
upto after upto after
one year one year one year one year
Financial assets
Advance for Shares -- -- -- -- 1,028,745 1,028,745 1,028,745
Long term deposits -- -- -- -- 2,070,454 2,070,454 2,070,454
Trade Debtors -- -- -- 30,617,386 -- 30,617,386 30,617,386
Advance and Deposits
(excluding income tax) -- -- -- 21,432,870 -- 21,432,870 21,432,870
Other receivable
(excluding duties & taxes) -- -- -- 1,867,915 -- 1,867,915 1,867,915
Cash and bank balances 16,483,051 1,004,648 17,487,699 19,746,483 -- 19,746,483 37,234,182
------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------
16,483,051 1,004,648 17,487,699 73,664,654 3,099,199 76,763,853 94,251,552
------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------
Financial liabilities
Long term loans -- -- -- -- 64,543,639 64,543,639 64,543,639
Liabilities against assets
subject to finance lease 19,151,063 46,453,458 65,604,521 -- -- -- 65,604,521
Short-term Finances 692,901,199 -- 692,901,199 -- -- -- 692,901,199
Creditors accrued and
other Liabilities -- -- -- 374,065,360 -- 374,065,360 374,065,360
Dividends -- -- -- 17,882,750 -- 17,882,750 17,882,750
------------------ ------------------ ------------------ ------------------ ------------------ ------------------ ------------------
712,052,262 46,453,458 758,505,720 391,948,110 64,543,639 456,491,749 1,214,997,469
========== ========== ========== ========== ========== ========== ==========
Interest / mark-up Rates Risk
The effective Interest Rates as at June 30, 2000 for the financial instruments are as follows
Assets
Bank Balances 8.00 - 13.00 per cent
Liabilities
Running finance 17.50 per cent
Export refinance 8.00 per cent
Liability against assets subject to finance lease 19.50 - 21.50 per cent
(ii) Concentration of Credit risk
Credit Risk represents the Accounting loss that would be recognized at the reporting date if counterparts failed to perform as contracted.
The company believes that it is not exposed to major concentration of credit risk.
(iii) Foreign exchange risk management
Foreign currency arises mainly when receivables and payables exists due to sales and purchase transaction with foreign undertakings.
As at June 30, 2000 the total foreign currency risk exposure was Rs. 18.84 million of which Rs. 9.88 million relates to liabilities under
documentary credit and Rs. 8.96 million relates to trade debtors.
(iv) Fair value of the financial instruments
The carrying value of all the financial instruments in the financial statements approximates their fair value.
36. PLANT CAPACITY AND PRODUCTION
The production capacity of the plant cannot be determined as it depends upon the process, the quality
of cloth used for printing and dyeing, which may compose of different kinds of fabrics and texture
having different construction and weights.
37. GENERAL
Previous year's figures have been re-arranged wherever necessary for the purpose of comparison.
NASEEM A. SATTAR AZIM AHMED
Chairman & Chief Executive Director
PATTERN OF SHARE HOLDINGS
AS AT JUNE 30, 2000
NUMBER OF SHARE HOLDERS TOTAL
SHARE HOLDERS SHARES
From To
92 1 -- 100 4,005
67 101 -- 500 13,470
51 501 -- 1,000 32,330
2 1,001 -- 5,000 4,725
4 5,001 -- 10,000 31,850
4 10,001 -- 15,000 53,000
4 15,001 -- 20,000 70,000
1 20,001 -- 25,000 22,120
2 45,001 -- 50,000 100,000
1 90,001 -- 95,000 90,450
1 185,001 -- 190,000 187,110
1 195,001 -- 200,000 197,495
1 340,001 -- 345,000 341,550
1 480,001 -- 485,000 482,627
1 1,100,001 -- 1,105,000 1,100,675
1 1,270,001 -- 1,275,000 1,271,173
1 1,935,001 -- 1,940,000 1,937,420
------------------ ------------------
235 TOTAL 5,940,000
========== ==========
Number of Shares Held Percentage
Categories of Shareholders Shareholders
1. Individuals 229 3,781,690 63.67
2. Joint Stock Companies 3 1,275 0.02
3. Financial Institutions 3 2,157,035 36.31
------------------ ------------------ ------------------
Total 235 5,940,000 100.00
========== ========== ==========
Google
 
Web Paksearch.com




Home | About Us | Contact | Information Resources