| Kohinoor Energy Limited |
|
|
|
|
|
|
|
| Annual
Report 2000 |
|
|
| CONTENTS |
|
|
| Company
Information |
|
| Notice
of Annual General Meeting |
|
| Directors'
Report |
|
| Auditors'
Report to the Members |
|
| Balance Sheet |
|
|
| Profit
and Loss Account |
|
| Statement
of Changes in Equity |
|
| Cash
Flow Statement |
|
| Notes
to the Accounts |
|
| Pattern
of Share Holding of Shares |
|
|
|
| COMPANY
INFORMATION |
|
|
| Board
of Directors |
|
| Mr.
M. Azam Saigol |
Chairman |
|
| Mr.
M. Naseem Saigol |
Chief Executive |
|
| Mr.
Sheikh Muhammad Shakeel |
|
| Mr.
Haruyoshi Murakami |
(Nominee of Tomen
Corporation, Japan) |
|
| Mr.
Akira Sasaki |
(Nominee of Tomen
Corporation, Japan) |
|
| Mr.
Hideyuki Ohashi |
(Nominee of Tomen Power
(Singapore) Pvt Ltd) |
|
| Mr.
Rolf Anderson |
(Nominee of Wartsila
Diesel Oy, Finland) |
|
|
| Corporate
Secretary |
|
| Mr.
Ahmed Zia Haider |
|
|
| Management |
|
| Mr.
M. Naseem Saigol |
Chief Executive |
|
| Mr.
Haruyoshi Murakami |
Chief Operating Officer |
|
| Mr.
Umer Masood Tariq |
General Manager Admin |
|
| Mr.
Mehboob A. Mirza |
General Manager Technical |
|
| Mr.
Archimedes B. Donato |
General Manager Plant |
|
| Mr.
Ahmed Zia Haider |
Finance Manager |
|
|
| Auditors |
|
| A.F.
Ferguson & Co. |
|
| Chartered
Accountants |
|
|
| Bankers |
|
| Off-Shore
Trustee |
|
| US
Bank Trust National Association, New York |
|
| On-Shore
Trustee |
|
| Union
Bank formerly Bank of America NT&SA, Lahore |
|
| Others |
|
| Al-Faysal
Investment Bank Limited |
|
| Emirates
Bank International |
|
| Bank
Alfalah Limited |
|
| Standard
Chartered Bank |
|
| ABN
AMRO Bank |
|
|
| Registered
Office |
|
| 2nd
Floor, Rashid Plaza |
|
| 24-D, Blue Area |
|
| Islamabad. |
|
| Tel:
92-51-824273 |
|
|
| Head
Office / Share Department |
|
| 06-Egerton
Road, Lahore |
|
| Tel:
92-42-6312936-37 |
|
| Fax:
92-42-6312938 |
|
|
| Project |
|
| 35
KM, Link Manga Raiwind Road, Lahore |
|
| Tel:
92-4951-391284-5 |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the seventh Annual General Meeting of Shareholders of
Kohinoor Energy |
|
| Limited
will be held on Friday December 22, 2000 at 11:00 A.M. at Registered Office,
Rashid Plaza, |
|
| 2nd
Floor, 24-D, Blue Area, Islamabad to transact the following business: |
|
|
| 1.
To confirm the minutes of the Annual General Meeting held on December 31,
1999. |
|
|
| 2.
To receive and adopt the Annual Audited Accounts for the year ended June 30,
2000 alongwith |
|
| Directors'
and Auditors' Reports thereon. |
|
|
| 3.
To approve issue of Bonus Shares at the rate of 30 shares of Rs. 10/- each
for every 100 shares |
|
| held
(30%) as recommended by the Board. |
|
|
|
| 4.
To appoint Auditors to hold office till the conclusion of the next Annual
General Meeting and |
|
| to
fix their remuneration. |
|
|
| 5.
Any other business with the permission of the Chair. |
|
|
| SPECIAL
BUSINESS |
|
|
| 1.
To approve the terms and conditions of appointment of Chief Executive of the
company as |
|
| recommended
by the Board. |
|
|
| 2.
To consider and pass the following Resolution as Special Resolution: |
|
| Resolved
that the Authorised capital of the Company be increased from Rs.
1,400,000,000 to |
|
| Rs.
1,700,000,000 divided into 170,000,000 Ordinary Shares of Rs. 10/- each. That
the Capital |
|
| clause
V of the Memorandum of Association of the Company be amended to the extent of |
|
| increased
Capital and division thereof and to give affect accordingly. |
|
|
| STATEMENT
UNDER SECTION 160 (1) (b) OF THE COMPANIES ORDINANCE, 1984. |
|
|
| 1.
Mr. M. Naseem Saigon was appointed as Chief Executive of the company on
20-04-2000 by the |
|
| Board
of Directors for a term of three years. The terms and conditions of his
appointment were |
|
| circulated
to the shareholders of the Company in terms of Section 218(2) of the
companies |
|
| Ordinance 1984. |
|
|
| 2.
It has been decided by the Board to increase the Authorised Capital of the
Company for future |
|
| capitalisation
of Profit/Issue of Shares |
|
|
|
|
|
|
|
By order of the Board |
|
|
|
|
|
|
| Lahore: |
|
|
(Ahmed Zia Haider) |
|
| November
22, 2000 |
|
|
Company Secretary |
|
|
| Notes: |
|
|
| 1.
The Share Transfer Books of the Company will remain closed from December 22,
2000 to |
|
| December
29, 2000 (both days inclusive). Transfers received at 06-Egerton Road, Lahore
the |
|
| Head
Office of the Company upto the close of business on December 21, 2000 will be
treated |
|
| in
time for the issue of Bonus Shares to the transferees. |
|
|
| 2.
A member entitled to attend and vote at this meeting may appoint a proxy.
Proxies in order |
|
| to
be effective, must be received at 06-Egerton Road, Lahore the Head Office of
the Company |
|
| not
less than forty-eight hours before the time of the meeting and must be duly
stamped, |
|
| signed
and witnessed. |
|
|
| 3.
Members are requested to notify the Company for change in their addresses, if
any. |
|
|
|
| DIRECTORS'
REPORT |
|
|
| The
Directors of your Company are pleased to present their annual report together
with the |
|
| Company's
audited annual accounts for the year ended June 30, 2000. |
|
|
| PRINCIPAL
ACTIVITIES |
|
| The
principal activities of the Company are to own, operate, and maintain a
furnace oil power |
|
| station
with a net capacity of 120 MW (Gross Capacity 131.44 MW). |
|
|
| OPERATIONS |
|
| The
plan was operated to a very high standard of thermal efficiency and
availability. The high |
|
| efficiency
rates were achieved through regular maintenance, which was carried out on all
8 units |
|
| and
on steam turbine during the year. Routine and preventive maintenance programs
have been |
|
| completed
within budget as scheduled to ensure the long term integrity of plant. |
|
|
| Kohinoor
Energy Limited has an operation and maintenance contract with Wartsila NSD
Pakistan |
|
| (Pvt.) Ltd. |
|
|
| During
the year of operations, the plant achieved a thermal efficiency rate of
43.38% and generated |
|
| 256,817,890
KWH of electricity on demand of WAPDA. |
|
|
| FINANCE |
|
| Turn
over for the year was 1.693 billion and operating cost were Rs. 807 million
resulting in a net |
|
| profit
of Rs. 394 million for the period with an EPS of Rs. 3.02. |
|
|
| Under
Power Purchase Agreement, WAPDA has provided a Standby Letter of Credit to
the Company |
|
| as
security for payments. |
|
|
| Company
has proved to have good relations with WAPDA, all the dispatch requirements
received |
|
| from
WAPDA were duly fulfilled by the Company in time. Company is also upto date
in receiving |
|
| all
its payments from WAPDA on the basis of original tariff signed between the
two parties. |
|
|
| The
Company has throughout the year fulfilled all of its statutory and
contractual obligations. The |
|
| Company
is upto date in making its debt service payments to lenders and there stands
no default |
|
| in this regard. |
|
|
| ENVIRONMENT,
HEALTH AND SAFETY |
|
| The
safety performance of your Company maintained its very high standards. The
overall health and |
|
| safety
performance of the Plant was excellent throughout the year. Kohinoor Energy
Limited has an |
|
| ongoing
proactive approach to safety management. |
|
|
| The
plant continues to operate within the strict environmental guidelines and
limits established by |
|
| the
World Bank for emission and waste. |
|
|
| APPROPRIATIONS |
|
| The
Board of Directors recommends bonus shares @ 30% on the paid up capital of
the Company. |
|
|
| AUDITORS |
|
| The
present auditors Messers A.F. Ferguson & Co. Chartered Accountants retire
at the conclusion |
|
| of
the Annual General Meeting, being eligible offer themselves for
reappointment. |
|
|
| DIRECTORS |
|
| Since
the last Annual General Meeting Mrs. Amber Saigol, Director and Mr. Pervez
Malik, Director/ |
|
| Chief
Executive has resigned and Mr. Hideyuki Ohashi (Nominee of Tomen Power
Singapore (Pvt) |
|
| Ltd)
and Mr. Sheikh Mohammad Shakeel have co-opted as Directors. Mr. M. Naseem
Saigol, Director, |
|
| holds
the office of Chief Executive and Mr. Haruyoshi Murakami, Director, is
holding the office of |
|
| Chief
Operating Officer. |
|
|
| The
Board of Directors wishes to record its appreciation for the valuable
services rendered by the |
|
| retiring
Directors and extends its warm welcome to the incoming Directors and Chief
Executive. |
|
|
| ACKNOWLEDGEMENT |
|
| Relationship
with the staff, especially with the workers, remains cordial. All
achievements made |
|
| during
the period under report were only possible due to great deal of dedicated
efforts and |
|
| teamwork
by the company's staff. The Directors take this opportunity to thank all of
them for their |
|
| hard
work and commitment. Development of management and staff has a high priority
in the |
|
| Company. |
|
|
| The
Directors wish to thank the banks and shareholders for their continued
support and confidence |
|
| on
the Company. |
|
|
| PATTERN
OF SHAREHOLDING |
|
| A
statement reflecting the pattern of shareholding as at June 30, 2000 is
attached to the Annual |
|
| Report. |
|
|
|
|
For and on behalf of the Board |
|
|
|
|
|
|
| Lahore |
|
|
M. Naseem Saigol |
|
| November
22, 2000 |
|
Chief Executive |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of Kohinoor Energy Limited as at June
30, 2000 and |
|
| the
related profit and loss account, statement of changes in equity and cash flow
statement together |
|
| with
the notes forming part thereof, for the year then ended and we state that we
have obtained |
|
| all
the information and explanations which, to the best of our knowledge and
belief, were necessary |
|
| for
the purposes of our audit. |
|
|
| 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 the 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
account- |
|
| ing
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, statement of changes in
equity and cash |
|
| flow
statement together with the notes forming part thereof conform with approved
ac- |
|
| counting
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 June 30, 2000 and of the profit,
changes in |
|
| equity
and its cash flow for the year then ended; and |
|
|
| (d)
in our opinion no zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980. |
|
|
| Lahore |
|
|
A.F. Ferguson & Co. |
|
| November
22, 2000. |
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 2000 |
|
|
|
Note |
2000 |
1999 |
|
|
|
(Rupees in
thousand) |
|
|
| CAPITAL |
|
|
|
| Authorised |
|
| 140,000,000
ordinary shares of Rs 10 each |
|
1,400,000 |
1,400,000 |
|
|
|
|
========== |
========== |
|
| Issued,
subscribed and paid up capital |
|
| 130,352,780
(1999: 130,352,780) ordinary shares |
|
| of
Rs 10 each issued for cash |
|
|
1,303,528 |
1,303,528 |
|
|
| RESERVES |
|
| Bonus shares |
|
|
391,058 |
-- |
|
| Share premium |
|
|
-- |
140,348 |
|
|
------------------ |
------------------ |
|
|
|
|
391,058 |
140,348 |
|
| Unappropriated
profit |
|
3 |
820,140 |
677,211 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
2,514,726 |
2,121,087 |
|
| LONG
TERM LOANS - SECURED |
4 |
3,248,702 |
3,746,315 |
|
|
|
|
|
| LONG
TERM LOANS - UNSECURED |
5 |
262,807 |
295,571 |
|
| DEFERRED
LIABILITIES |
|
6 |
5,029 |
5,899 |
|
|
|
| CURRENT
LIABILITIES |
|
| Current
maturity of long term loans |
|
| Secured |
|
4 |
526,487 |
522,460 |
|
| Unsecured |
|
5 |
87,603 |
52,160 |
|
| Creditors,
accrued and other liabilities |
7 |
324,359 |
293,250 |
|
| Provision
for taxation |
|
|
32,522 |
22,314 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
970,971 |
890,184 |
|
| CONTINGENCIES
AND COMMITMENTS |
8 |
|
|
------------------ |
------------------ |
|
|
|
7,002,235 |
7,059,056 |
|
|
========== |
========== |
|
| FIXED
CAPITAL EXPENDITURE |
|
|
| Operating
fixed assets |
|
9 |
5,486,520 |
5,732,977 |
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Stores,
spares and loose tools |
|
10 |
162,708 |
152,499 |
|
| Stock in trade |
|
11 |
29,623 |
129,859 |
|
| Trade debts |
|
12 |
315,915 |
248,637 |
|
| Advances,
deposits, prepayments and other receivables |
13 |
229,305 |
153,176 |
|
| Cash
and bank balances |
|
14 |
778,164 |
641,908 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
1,515,715 |
1,326,079 |
|
|
------------------ |
------------------ |
|
|
|
|
7,002,235 |
7,059,056 |
|
|
|
|
|
========== |
========== |
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
Chief Executive |
|
Director |
|
|
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
|
|
Note |
2000 |
1999 |
|
|
|
(Rupees in
thousand) |
|
|
| Sales |
|
15 |
1,693,258 |
1,834,192 |
|
| Cost of sales |
|
16 |
806,796 |
1,076,213 |
|
|
|
|
------------------ |
------------------ |
|
| Gross profit |
|
|
886,462 |
757,979 |
|
| Administration
and general expenses |
17 |
121,123 |
26,160 |
|
|
|
|
------------------ |
------------------ |
|
| Operating profit |
|
|
765,339 |
731,819 |
|
| Other income |
|
18 |
53,226 |
52,020 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
818,565 |
783,839 |
|
| Financial
charge |
|
19 |
408,805 |
458,559 |
|
|
|
|
------------------ |
------------------ |
|
| Profit before tax |
|
|
409,760 |
325,280 |
|
| Provision
for taxation |
|
20 |
16,121 |
17,831 |
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
|
393,639 |
307,449 |
|
|
|
|
========== |
========== |
|
| Earnings
per share |
|
25 |
3.02 |
2.36 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
|
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN EQUITY |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
|
|
Rupees in thousand |
|
|
|
|
Reserve |
|
|
|
|
for issue |
|
Un-appro- |
|
|
|
|
Share |
of bonus |
Share |
priated |
|
|
|
|
capital |
shares |
premium |
profit |
Total |
|
|
|
|
| Balance
as on June 30, 1998 |
1,303,528 |
-- |
140,348 |
369,762 |
1,813,638 |
|
| Net
profit for the year |
-- |
-- |
-- |
307,449 |
307,449 |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
| Balance
as on June 30, 1999 |
1,303,528 |
-- |
140,348 |
677,211 |
2,121,087 |
|
|
|
|
|
| Net
profit for the year |
-- |
-- |
-- |
393,639 |
393,639 |
|
|
|
|
|
| Appropriation |
|
|
|
| Reserve
for issue of bonus shares |
-- |
391,058 |
(140,348) |
250,710) |
-- |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
| Balance
as on June 30, 2000 |
1,303,528 |
391,058 |
-- |
820,140 |
2,514,726 |
|
|
|
========== |
========== |
========== |
========== |
========== |
|
|
|
Chief Executive |
|
Director |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
|
Note |
2000 |
1999 |
|
|
(Rupees in
thousand) |
|
|
| Cash
flow from operating activities |
|
| Cash
generated from operations |
|
21 |
992,105 |
920,423 |
|
| Staff
gratuity paid |
|
|
(3,036) |
-- |
|
| Financial
charges paid |
|
|
(381,440) |
(414,845) |
|
| Taxes paid |
|
|
(5,913) |
(4,639) |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash inflow from operating activities |
|
601,716 |
500,939 |
|
|
|
|
|
| Cash
flow from investing activities |
|
| Fixed
capital expenditure |
|
(44,612) |
(480,283) |
|
| Interest/mark-up
income received |
|
68,202 |
46,818 |
|
| Sale
proceeds of fixed assets |
|
1,857 |
3,434 |
|
|
|
------------------ |
------------------ |
|
| Net
cash inflow/(outflow) from investing activities |
|
25,447 |
(430,031) |
|
|
|
|
|
| Cash
flow from financing activities |
|
| Long
term loans (net) |
|
|
(490,907) |
78,177 |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash (outflow)/inflow from financing activities |
(490,907) |
78,177 |
|
|
|
|
------------------ |
------------------ |
|
| Net
increase in cash and cash equivalents |
|
136,256 |
149,085 |
|
| Cash
and cash equivalents at beginning of the year |
641,908 |
492,823 |
|
|
|
|
------------------ |
------------------ |
|
| Cash
and cash equivalents at the end of the year |
14 |
778,164 |
641,908 |
|
|
========== |
========== |
|
|
|
Chief Executive |
|
Director |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
| 1.
THE COMPANY AND ITS OPERATIONS |
|
| The
company was incorporated on April 26, 1994 and received Certificate for
Commencement |
|
| of
Business on September 14, 1994. The company is listed on all Stock Exchanges
in Pakistan |
|
| and
its principal activity is power generation and supply to WAPDA. The company
commenced |
|
| its
commercial operations from June 20, 1997. |
|
|
|
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
|
| 2.1
Accounting convention |
|
|
|
| The
accounts have been prepared under the historical cost convention, modified by |
|
| capitalisation
of exchange differences referred to in note 2.7. |
|
|
| 2.2 Taxation |
|
|
|
| Profit
and gains derived by the company from electric power generation project are |
|
| exempt
from tax under clause 176 of Part I of the Second Schedule to the Income Tax |
|
| Ordinance,
1979. |
|
|
|
| The
company is also exempt from minimum tax on turn over under clause 20 of the
Part |
|
| IV
of Second Schedule to the Income Tax Ordinance, 1979. |
|
|
| 2.3
Retirement benefits |
|
| The
company operates an unapproved, unfunded gratuity scheme for all employees, |
|
| payable
on cessation of employment, subject to a minimum qualifying period of
service. |
|
| Provision
is made annually to cover obligations under the scheme for all employees |
|
| eligible
to gratuity benefits. |
|
|
| 2.4 Fixed assets |
|
| Operating
fixed assets except land are stated at cost less accumulated depreciation.
Land |
|
| and
capital work in progress are stated at cost. Cost of certain fixed assets
comprise of |
|
| historical
cost, exchange differences referred to in note 2.7 and interest etc. in note
2.8. |
|
|
| Depreciation
on operating fixed assets is charged to profit on the straight line method |
|
| so
as to write off the historical cost of an asset over its estimated useful
life at the annual |
|
| rates
mentioned in note 9. The net exchange differences relating to an asset, at
the end |
|
| of
each year is amortised in equal installments over its remaining useful life.
Depreciation |
|
| on
additions is charged from the month in which the asset is put to use and no
depreciation |
|
| is
charged on assets deleted during the year. |
|
|
| Maintenance
and normal repairs are charged to income as and when incurred. Major |
|
| renewals
and improvements are capitalised. Gains and losses on disposal of assets are |
|
| taken
to profit and loss account. |
|
|
| 2.5
Stores, spares and loose tools |
|
| Stores,
spares and loose tools are valued principally at moving average cost. Items
in |
|
| transit
are valued at cost comprising invoice values plus other charges incurred
thereon. |
|
