| Azam Textile Mills Limited |
|
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| Annual
Report 2000 |
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| Contents |
|
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| Company Information |
|
| Notice
of Annual General Meeting |
|
| Directors Report to the
Shareholders |
|
| Pattern
For shareholding |
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| Auditors Report to the Members |
|
| Balance Sheet |
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| Profit
& Loss Accounts |
|
| Cash
Flow Statement |
|
| Statement
of Changes in Equity |
|
| Notes to the Accounts |
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|
|
| COMPANY
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
|
| Mr.
Naseem Saigol |
|
(Chief Executive) |
|
| Mr.
Shahid Sethi |
|
| Mr.
Muhammad Ilyas Bajwa |
|
| Mr.
Muhammad Asif Bajwa |
|
| Mr.
Saeed Mian Ansari |
|
| Mr.
Muhammad Omer Farooq |
|
| Mr.
Muhammad Ayub (NIT Nominee) |
|
|
| COMPANY
SECRETARY |
|
| Mr.
Sultan Ali |
|
|
| AUDITORS |
|
| M/s
Hameed Chaudhri & Co. |
|
| Chartered
Accountants |
|
|
|
| BANKERS |
|
| Allied
Bank of Pakistan Limited |
|
| AI-Faysal
Investment Bank Limited |
|
| Askari
Commercial Bank Limited |
|
| Faysal
Bank Limited |
|
| National
Bank of Pakistan |
|
| National
Development Finance Corporation |
|
| Standard
Chartered Bank |
|
| Union
Bank Limited |
|
|
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| REGISTERED
OFFICE |
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| 06-Egerton
Road, Lahore |
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| Tel:
6306131 (5 Linies) |
|
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| MILLS |
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| 51,
K.M. Multan Road, |
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| Bhai Pheru, |
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| District
Kasur |
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|
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| NOTICE
OF ANNUAL GENERAL MEETING |
|
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| Notice
is hereby given that the Fourteenth Annual General Meeting of Shareholders of
Azam textile |
|
| Mills
Limited will be held on 31 st March, 2001 (Saturday) at 10' 00 a.m. at
6-Egerton Road, Lahore the |
|
| Registered
Office of the Company to transact the following business: |
|
|
| 1.
To confirm the minutes of the Thirteenth Annual General Meeting of the
Company held on |
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| 31
March, 2000. |
|
|
| 2.
To receive and adopt the Annual Audited Accounts for the year ended 30
September, 2000 |
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| alongwith
Directors' and Auditors' reports thereon. |
|
|
| 3.
To approve payment of cash dividend @ 7.5% (Re. 0.75 per share) to the
entitled shareholders |
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| excluding
the sponsoring shareholders of the company as recommended by the Board. |
|
|
| 4.
To appoint Auditors to hold office till the conclusion of the next Annual
General Meeting and |
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| to
fix their remuneration. |
|
|
| 5.
Any other business with the permission of the Chair. |
|
|
|
By Order of the Board |
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|
|
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|
(Sultan Ali) |
|
| Lahore:
March 09, 2001 |
|
Company Secretary |
|
|
| Notes: |
|
| 1.
The Share Transfer Books of the Company will remain closed from 31 March 2001
to 06 April |
|
| 2001
(both days inclusive). Transfers received in order at 06-Egerton Road, Lahore
the Registered |
|
| Office
of the Company upto the close of Business on 30 March 2001 will be treated in
time for |
|
| the
payment of Dividend to the Transferees.. |
|
|
| 2.
The sponsoring shareholders have waived off their right to receive the cash
dividend for the |
|
| year
ended 30 September, 2000. |
|
|
| 3.
A Member entitled to attend and vote at this meeting may appoint another
member as proxy. |
|
| proxies
in order to be effective, must be received at the Registered Office of the
Company not |
|
| later
than forty-eight hours before the time of the meeting and must be duly
stamped, signed |
|
| and
witnessed. |
|
|
| 4.
Members of all recognized fiqahs may file with the Company their declaration
(if any) for Non- |
|
| Deduction
of Zakat. |
|
|
| 5.
Members are requested to notify the Company change in their addresses, if
any. |
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|
|
| DIRECTORS'
REPORT TO THE SHAREHOLDERS |
|
|
| It
is a matter of great pleasure to present the 14th Annual Report and audited
accounts for the |
|
| financial
year closed on September 30, 2000. |
|
|
| The
directors recommended appropriation of profit as under: |
|
|
|
Rs, '000' |
|
| Profit
before taxation |
|
35,991 |
|
| Provision
for taxation |
|
(2,855) |
|
|
------------ |
|
| Profit
after taxation |
|
33,136 |
|
| Appropriations: |
|
|
|
| Proposed
dividend @ 7.5% |
|
|
|
| (excluding
sponsoring shareholders) |
|
(3,228) |
|
|
------------ |
|
|
29,907 |
|
| Accumulated
Loss - Brought forward |
|
(204,512) |
|
|
------------ |
|
| Accumulated
Loss - Carried to Balance Sheet |
(174,604) |
|
|
========== |
|
| The
year under review witnessed on overall turnaround in the textile sector
mainly due to the fall in |
|
| cotton
prices. |
|
|
| The
Company earned an operating profit of Rs. 93.215 million and net profit of
Rs. 35.991 million |
|
| which
are 16.6% & 6.41% of the sales respectively. |
|
|
| Though
the overall revenue from sales is lower by 12% as compared to last year but
due to decrease |
|
| in
cotton prices and by controlling the production and operating cost the gross
profit at Rs. 115.772 |
|
| million
& net profit at Rs. 35.991 million showed an increase of 157% & 233%
over last year respectively. |
|
| Financial
charges at Rs. 65.112 million are higher by Rs. 10.420 million over last
year, mainly because |
|
| of
buying cotton through associated undertaking at cost plus mark-up basis. |
|
|
| The
results for the year could' have been even better if we were allowed to
utilize the cash finance |
|
| limits.
However, during the year we have managed to reduce the debt burden to a great
extent |
|
| and
are pleased to inform you that the bankers' have agreed to release the limits
for the current |
|
| year. |
|
|
| Nevertheless,
your management has thrived hard to sustain the profit tempo of last year to
some |
|
| extent
and is hopeful of achieving favorable results for the current fiscal. |
|
|
| Keeping
in view the cash flows, the sponsoring shareholders voluntarily forego the
right to receive |
|
| dividends
from the Company. |
|
|
| Since
the last Annual General Meting Mr. M. Azam Saigol resigned from the Board of
Directors of the |
|
| Company
and in his place Mr. Muhammad Omer Farooq appointed as director of the
Company. |
|
| We
wish to place on record our appreciation for the valuable contribution made
by him during his |
|
| tenure
as director. |
|
|
| The
auditors M/s. Hameed chaudhri & Co., Chartered Accountants retire and
being eligible, offer |
|
| themselves
for reappointment. |
|
|
| Statement
showing the pattern of holding of shares held by the shareholders of Azam
Textile Mills |
|
| Limited
as on September 30, 2000 is attached. |
|
|
| Your
Directors are pleased to record their appreciation of the services rendered
by the officers and |
|
| workers
of the company and hope that the same spirit will continue in the future. We
are grateful to |
|
| the
bankers of the company who have always extended good co-operation towards the
running of |
|
| the
company. |
|
|
| LAHORE: |
|
M. NASEEM SAIGOL |
|
| 09
MARCH, 2001 |
|
CHIEF EXECUTIVE |
|
|
|
| PATTERN
OF HOLDING OF SHARES |
|
| HELD
BY THE SHAREHOLDERS AS AT 30 SEPTEMBER, 2000 |
|
|
| NO. OF |
|
SHAREHOLDING |
|
TOTAL |
|
| SHAREHOLDERS |
FROM |
|
TO |
|
SHARES HELD |
|
| 93 |
1 |
-- |
100 |
|
Shares |
7,927 |
|
| 294 |
101 |
-- |
500 |
|
Shares |
101,125 |
|
| 180 |
501 |
-- |
1000 |
|
Shares |
121,175 |
|
| 151 |
1001 |
-- |
5000 |
|
Shares |
360,887 |
|
| 31 |
5001 |
-- |
10000 |
|
Shares |
223,150 |
|
| 6 |
10001 |
-- |
15000 |
|
Shares |
69,100 |
|
| 2 |
15001 |
-- |
20000 |
|
Shares |
35,075 |
|
| 4 |
20001 |
-- |
25000 |
|
Shares |
92,350 |
|
| 2 |
30001 |
-- |
35000 |
|
Shares |
63,891 |
|
| 2 |
35001 |
-- |
40000 |
|
Shares |
72,075 |
|
| 2 |
40001 |
-- |
45000 |
|
Shares |
82,750 |
|
| 1 |
45001 |
-- |
50000 |
|
Shares |
45,811 |
|
| 1 |
60001 |
-- |
65000 |
|
Shares |
63,600 |
|
| 1 |
80001 |
-- |
85000 |
|
Shares |
81,875 |
|
| 1 |
100001 |
-- |
105000 |
|
Shares |
103,500 |
|
| 1 |
130001 |
-- |
135000 |
|
Shares |
130,620 |
|
| 1 |
140001 |
-- |
145000 |
|
Shares |
141,700 |
|
| 1 |
145001 |
-- |
150000 |
|
Shares |
149,300 |
|
| 2 |
290001 |
-- |
295000 |
|
Shares |
585,702 |
|
| 1 |
345001 |
-- |
350000 |
|
Shares |
346,275 |
|
| 1 |
1165001 |
-- |
1170000 |
|
Shares |
1,167,519 |
|
| 1 |
1415001 |
-- |
1420000 |
|
Shares |
1,417,981 |
|
| 1 |
1430001 |
-- |
1435000 |
|
Shares |
1,433,000 |
|
| 1 |
2050001 |
-- |
2055000 |
|
Shares |
2,050,445 |
|
| 1 |
4325001 |
-- |
4330000 |
|
Shares |
4,328,167 |
|
| ----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
|
| 782 |
|
13,275,000 |
|
| ========== |
========== |
========== |
========== |
========== |
========== |
========== |
|
| Note:
The slabs not applicable, have not been shown, |
|
|
| CATEGORIES
OF SHAREHOLDERS |
Number |
Shares Held |
Percentage |
|
| Individuals |
|
753 |
9,989,770 |
75.25 |
|
| Investment
Companies |
|
3 |
484,645 |
3.65 |
|
| Insurance
Companies |
|
5 |
235,450 |
1.77 |
|
| Joint
Stock Companies |
|
5 |
185,475 |
1.40 |
|
| Financial
Institutions |
|
8 |
2,136,610 |
16.10 |
|
| Foreign
Companies |
|
3 |
170,500 |
1.28 |
|
| Modaraba
Companies |
|
5 |
72,550 |
0.55 |
|
|
----------- |
----------- |
----------- |
|
|
782 |
13,275,000 |
100.00 |
|
|
========== |
========== |
========== |
|
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
|
| We
have audited the annexed Balance Sheet of AZAM TEXTILE MILLS LIMITED as at 30
September, |
|
| 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, |
|
| except
for the contents of note 25.1, 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, except for the contents of note 13.4, 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, Cash Flow Statement and Statement
of Changes |
|
| in
Equity 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, except for the contents of notes 10.2,
13.2, |
|
| 18.2
and 19.1 (d) and the extent to which these may affect the annexed accounts,
respectively |
|
| give
a true and fair view of the state of the Company's affairs as at 30
September, 2000 and of |
|
| the
profit, its cash flows and changes in equity for the year then ended; and |
|
|
| (d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980. |
|
|
|
HAMEED CHAUDHRI & CO. |
|
| LAHORE:
09 March, 2000 |
|
CHARTERED ACCOUNTANTS |
|
|
|
|
| BALANCE
SHEET AS AT 30 SEPTEMBER, 2000 |
|
|
|
|
2000 |
1999 |
|
|
Note |
Rupees |
Rupees |
|
| SHARE
CAPITAL |
|
| Authorised: |
|
| 15,000,000
ordinary shares of |
|
| Rs, 10 each |
|
150,000,000 |
150,000,000 |
|
|
========== |
========== |
|
| Issued,
subscribed and paid-up |
|
3 |
132,750,000 |
132, 750,000 |
|
|
|
|
| ACCUMULATED
LOSS |
|
(174,603,892) |
(204,511,763) |
|
|
|
|
|
(41,853,892) |
(71,761,763) |
|
|
|
|
| SURPLUS
ON REVALUATION OF |
|
|
|
| FIXED
ASSETS |
|
4 |
314,080,342 |
319,232,821 |
|
|
|
|
|
| LONG
TERM FINANCES |
|
5 |
112,303,125 |
127,290,000 |
|
|
|
|
|
| LONG
TERM LOANS |
|
6 |
41,329,697 |
38,329,697 |
|
|
|
|
|
| CUSTOMS
DUTIES PAYABLE |
|
7 |
0 |
339,765 |
|
|
|
|
|
| DEFERRED
LIABILITY FOR GRATUITY |
|
2,464,475 |
2,264,265 |
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Current
portion of long term liabilities |
|
8 |
18,986,875 |
22,839,765 |
|
|
| Short
term finances |
|
9 |
79,337,777 |
164,950,920 |
|
| Creditors,
accruals and other liabilities |
|
10 |
168,650,044 |
169,313,325 |
|
| Provision
for taxation |
|
11 |
4,269,253 |
8,637,345 |
|
| Proposed
dividend |
|
3,227,977 |
0 |
|
|
----------- |
----------- |
|
|
274,471,926 |
365,741,355 |
|
|
| CONTINGENCIES
AND COMMITMENTS |
12 |
|
|
----------- |
----------- |
|
|
702,795,673 |
781,436,140 |
|
|
========== |
========== |
|
| FIXED
CAPITAL EXPENDITURE |
|
|
|
| Operating
fixed assets |
|
13 |
486,813,537 |
519,066,707 |
|
| Capital
work-in-progress |
|
14 |
0 |
1,190,507 |
|
|
|
----------- |
----------- |
|
|
|
486,813,537 |
520,257,214 |
|
| LONG
TERM DEPOSITS AND DEFERRED COSTS |
15 |
408,253 |
528,849 |
|
| CURRENT
ASSETS |
|
|
|
|
| Stores,
spares and loose tools |
|
16 |
6,328,260 |
7,435,023 |
|
| Stock-in-trade |
|
17 |
76,820,000 |
91,742,300 |
|
| Trade
debtors |
|
18 |
31,427,139 |
25,060,822 |
|
| Advances,
deposits, prepayments |
|
|
|
|
| and
other receivables |
|
19 |
99,508,866 |
134,377,252 |
|
|
| Cash and bank balances |
|
20 |
1,489,618 |
2,034,680 |
|
|
----------- |
----------- |
|
|
215,573,883 |
260,650,077 |
|
|
|
----------- |
----------- |
|
|
|
702,795,673 |
781,436,140 |
|
|
|
========== |
========== |
|
|
|
| The
annexed notes form an integral part of these accounts |
|
|
|
DIRECTOR |
|
CHIEF EXECUTIVE |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED 30 SEPTEMBER, 2000 |
|
|
|
|
2000 |
1999 |
|
|
|
Note |
Rupees |
Rupees |
|
| SALES - Net |
|
21 |
561,914,589 |
636,579,470 |
|
| COST
OF SALES |
|
23 |
446,142,312 |
591,481,704 |
|
|
|
|
----------- |
----------- |
|
| GROSS
PROFIT |
|
115,772,277 |
45,097,766 |
|
|
|
| ADMINISTRATIVE
AND SELLING EXPENSES |
23 |
22,556,628 |
20,784,484 |
|
|
----------- |
----------- |
|
| OPERATING
PROFIT |
|
93,215,649 |
24,313,282 |
|
| OTHER
INCOME |
|
24 |
12,565,643 |
3,684,872 |
|
|
----------- |
----------- |
|
|
105,781,292 |
27,998,154 |
|
| OTHER
CHARGES |
|
| Financial
- Net |
|
25 |
65,112,318 |
54,692,097 |
|
| Miscellaneous |
|
26 |
2,783,478 |
328,921 |
|
| Workers'
(profit) participation fund |
|
1,894,275 |
0 |
|
|
----------- |
----------- |
|
|
69,790,071 |
55,021,018 |
|
|
----------- |
----------- |
|
| PROFIT/(LOSS)
FOR THE YEAR - Before taxation |
|
35,991,221 |
(27,022,864) |
|
|
| PROVISION
FOR TAXATION |
|
11 |
|
| -
Current year |
|
2,900,000 |
3,201,600 |
|
| - Prior years |
|
(44,627) |
(67,529) |
|
|
----------- |
----------- |
|
|
2,855,373 |
3,134,071 |
|
|
----------- |
----------- |
|
| PROFIT/(LOSS)
FOR THE YEAR - After taxation |
|
33,135,848 |
(30,156,935) |
|
| APPROPRIATION: |
|
| Proposed
dividend to shareholders excluding |
|
| sponsoring
shareholders @ 7.5% (1999: Nil) |
|
3,227,977 |
0 |
|
|
----------- |
----------- |
|
|
29,907,871 |
(30,156,935) |
|
| ACCUMULATED
LOSS - Brought forward |
|
204,511,763 |
(174,354,828) |
|
|
|
----------- |
----------- |
|
| ACCUMULATED
LOSS - Carried to Balance Sheet |
|
(174,603,892) |
(204,511,763) |
|
|
|
========== |
========== |
|
| EARNINGS
PER SHARE |
|
27 |
2.50 |
(2.27) |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
DIRECTOR |
|
CHIEF EXECUTIVE |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED 30 SEPTEMBER, 2000 |
|
|
|
|
|
2000 |
1999 |
|
|
|
|
Rupees |
Rupees |
|
| NET
CASH INFLOW FROM OPERATING |
|
| ACTIVITIES
(NOTE 'A') |
|
138,763,512 |
5,312,316 |
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Associated
Undertaking's loans repaid |
|
| including
exchange fluctuation loss - Nil |
|
| (1999:
Rs. 753,680) |
|
0 |
(3,964,777) |
|
| Long
term loans |
|
3,000,000 |
0 |
|
| Suppliers'
credits repaid |
|
| including
exchange fluctuation loss - Nil |
|
| (1999:
Rs. 1,093,551) |
|
0 |
(10,937,610) |
|
| Customs
duties paid |
|
(679,530) |
(339,765) |
|
| Short
term finances - net |
|
(84,442,887) |
63,017,042 |
|
| Financial
charges paid |
|
(48,099,885) |
(45,566,522) |
|
| Long
term finances repaid |
|
(18,500,000) |
0 |
|
|
----------- |
----------- |
|
|
| NET
CASH INFLOW / (OUTFLOW) FROM FINANCING ACTIVITIES |
(148,722,302) |
2,208,368 |
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Tangible
fixed assets acquired |
|
| excluding
exchange fluctuation loss - Nil |
|
| (1999:
Rs. 1,847,231) |
|
(1,764,589) |
(2,240,083) |
|
| Sale
proceeds of fixed assets |
|
12,217,363 |
225,567 |
|
| Return
on bank deposits |
|
10,614 |
669,205 |
|
| Long
term deposits and deferred costs |
|
120,596 |
1,671,096 |
|
|
----------- |
----------- |
|
| NET
CASH INFLOW FROM INVESTING ACTIVITIES |
10,583,984 |
325,785 |
|
| NET
INCREASE IN CASH AND CASH EQUIVALENTS |
625,194 |
7,846,469 |
|
| CASH
AND CASH EQUIVALENTS |
|
|
|
| -
At the beginning of the year |
|
864,424 |
(6,982,045) |
|
| CASH
AND CASH EQUIVALENTS |
|
|
|
|
|
----------- |
----------- |
|
| -
At the end of the year (note 'B') |
|
1,489,618 |
864,424 |
|
|
========== |
========== |
|
|
|
1999 |
2000 |
|
| NOTE |
|
Rupees |
Rupees |
|
| FOR
THE YEAR ENDED 30 SEPTEMBER, 2000 |
|
35,991,221 |
(27,022,864) |
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Profit/(Loss)
for the year - Before taxation |
|
| Adjustments
for: |
|
|
|
| Depreciation |
|
28,268,730 |
12,222,847 |
|
| Provision
for gratuity - net |
|
200,210 |
(35,888) |
|
| Los |
