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Indus Motor Company Limited
Annual Report 2000
CONTENTS
Toyota's Guiding Principles
Company Information
Five Years at a Glance
Directors' Report
Chairman's Review
Auditors' Report
Balance Sheet
Profit and Loss Account
Statement of Changes in Financial Position
Notes to the Accounts
Pattern of Shareholding
Notice of Annual General Meeting
TOYOTA'S GUIDING PRINCIPLES
Honour the language and spirit of the law of every nation and undertake open and fair
corporate activities to be a good corporate citizen of the world.
Respect the culture and customs of every nation and contribute to economic and social
development through corporate activities in the communities.
Dedicate ourselves to providing clean and safe products and to enhancing the quality of
life everywhere through all our activities.
Create and develop advanced technologies and provide outstanding products and services
that fulfill the needs of customers worldwide.
Foster a corporate culture that enhances individual creativity and teamwork value, while
honouring mutual trust and respect between labour and management.
Pursue growth in harmony with the global community through innovative management.
Work with business partners in research and creation to achieve stable, long-term growth
and mutual benefits, while keeping ourselves open to new partnerships.
COMPANY INFORMATION
BOARD OF DIRECTORS
Mr. Ali S. Habib Chairman
Mr. Yutaka Arae Vice Chairman
Mr. Farhad Zulficar Chief Executive Officer
Mr. Mohamedali R. Habib Director
Mr. Tokuichi Uranishi Director
Mr. Masaru Kato Director
Mr. Kersi Kapadia Director
COMPANY SECRETARY
Mr. Shahid Mahmood Khan
Bankers
ABN Amro Bank
American Express
ANZ Grindlays Bank plc
Askari Commercial Bank
Bank of Tokyo-Mitsubishi, Ltd.
Credit Agricole Indosuez
Emirates Bank International Ltd.
Faysal Bank Ltd.
Habib Bank AG Zurich
Habib Bank Limited
Hong Kong & Shanghai Banking Corporation
Metropolitan Bank Limited
Muslim Commercial Bank Ltd.
National Bank of Pakistan
Societe Generale
Standard Chartered Bank
Union Bank Ltd.
Auditors
M/s. Ford, Rhodes, Robson, Morrow
Chartered Accountants
1st Floor, Finlay House,
I. I. Chundrigar Road, Karachi
Legal Advisors
M/s. A. K. Brohi & Co.
M/s. Mansoor Ahmed Khan & Co.
M/s. Mahmud & Co.
Registered Office
14, Bangalore Town Housing Society,
Main Shahrah-e-Faisal, Karachi.
Registrar
M/s. Noble Computer Services (Pvt) Ltd.
14, Bangalore Town Housing Society,
Main Shahrah-e-Faisal, Karachi.
Factory
Plot No. NWZ/1/P-1,
Port Qasim Industrial Estate,
Bin Qasim, Karachi.
FIVE YEARS AT A GLANCE
2000 1999 1997 1996 1998
(Rupees in '000)
Vehicles sales (units) 11,944 11,249 9,295 8,100 8,125
Turnover-net 8,246,268 6,957,876 4,973,991 4,538,220 4,136,100
Profit before taxation 280,230 501,310 271,702 226,286 221,024
Taxation 107,976 250,021 124,538 76,082 33,789
Profit after taxation 172,254 251,289 147,164 150,204 187,235
Number of employees 643 625 611 598 546
Earnings per share
(in Rupees) 2.19 3.20 1.87 1.91 2.38
Contribution to National Exchequer 2,867,667 2,508,616 1,784,135 1,759,323 1,257,578
DIRECTORS' REPORT
The Directors of Indus Motor Company Limited take pleasure in presenting this Report, together with the
Accounts of the Company for the year ended June 30, 2000 and recommend the following
appropriations:
Note 2000 1999
(Rs. in '000)
OPERATING RESULTS
Profit before taxation 280,230 501,310
Taxation - Current 53,476 177,972
- Prior (4,500) 11,138
- Deferred 59,000 60,911
------------ ------------
107,976 250,021
------------ ------------
PROFIT AFTER TAXATION 172,254 251,289
Unappropriated profit brought forward 60 971
------------ ------------
172,314 252,260
APPROPRIATIONS
Dividend-proposed @ 15% (1999:20%) 117,900 157,200
Transfer to revenue reserve 54,000 95,000
------------ ------------
171,900 252,200
------------ ------------
Unappropriated profit carried forward 414 60
========== ==========
Auditors
The auditors, Messrs, Ford, Rhodes, Robson, Morrow, retire at the conclusion of the 11th Annual
General Meeting and being eligible, offer themselves for re-appointment.
Chairman's Review
The Directors of the Company endorse the contents of the chairman's Review dealing with the
Company activities which is included in the Annual Report and forms an integral part of the Directors'
Report.
Year 2000 Compliance
The Company is Y2K compliant.
Earnings Per Share (EPS)
The Earnings Per Share is Rs. 2.19.
Pattern of Shareholding
The Pattern of Shareholding of the Company as at June 30, 2000 is given on page 40.
Karachi
September 22, 2000
Farhad Zulficar Yutaka Arae
Chief Executive Officer & Director Vice Chairman & Director
CHAIRMAN'S REVIEW
BISMILLAH HIR REHMAN NIR RAHIM
To this, the 11th Annual General Meeting of Indus Motor Company, the first to fall in the new
millennium, I welcome you all and am happy to present to you the report on your Company's
performance for the year ended 30 June, 2000. The Directors are pleased to recommend a cash
dividend of 15% for the year, after allocating a part of the profits to the Company's reserves.
The Company's operations resulted in gross profit of Rs. 544 million and net profit after tax of Rs. 172
million, after providing for current and deferred taxation of Rs. 112 million. There was a cost
increase brought on by the appreciation of the Yen and gross profit margin decreased by 4%
compared to previous year. This was inevitable, as the highly competitive nature of the automobile
market did not allow all cost increases to be fully absorbed in the price.
OPERATIONS and MARKETING
Meeting the challenges of the new millennium, your company entered the small car segment of
the market and began commercial production of the Daihatsu cuore in March, 2000. To celebrate
the occasion, a colorful ceremony was held at the plant at Port Qasim, which was attended by
distinguished dignitaries including Mr. I. Shingu, President of Daihatsu, and other representatives
of Toyota Motor Corporation, Toyota Tsusho Corporation and Daihatsu Motor Company Ltd.
The guests included bankers, government officials, potential customers and others.
Subsequently, sales launches were held at Karachi and Lahore. This launch proved to be
another significant step in the history of your company. We are pleased to say that the initial
market response to the Daihatsu cuore has been extremely positive and customers feedback
regarding the quality and overall performance of the car has been excellent.
In anticipation of the launch of the Daihatsu Cuore,  training schools were
established in Karachi, Lahore and Islamabad. These schools
were set up to provide technical training for skilled workers and
to create a support system catering to after sales service
for the Cuore at dealerships.
Modern training equipment and material was donated by your
Company to the Government College of Technology and
Education - Lahore, under the T-TEP Education Program of
Toyota Motor Corporation.
Instructors at the school received intensive training for both Daihatsu and Toyota vehicles.
The long-term goal for this school is to modernize and improve education in auto technology. 
This ultimately will ensure the availability of properly trained technicians for the industry.
Significantly, your Company has achieved the highest sales
volume to date during the year 1999-2000, marking a
propitious beginning to the new millennium. This was the result
of several factors including the introduction of the new-look
Corolla in July last year, the new model of Hilux in
September, and the sales launch of Cuore in April.
Your Company has maintained a healthy market share which was 53% in the Toyota range of 
vehicles and 47% in the  Hilux commercial category. Market share remained 
high inspire of increased competition and the introduction of new products. Enduring 
customer loyalty has led to the sale of over 50,000 vehicles from the beginning of
production till May 2000. These successes were directly the result of an innovative marketing
strategy with respect to new product variants and aggressive leasing campaigns, which helped your
company achieve its volume goals.
DEALERSHIP NETWORK
With the introduction of Daihatsu, the company's existing seventeen 3-S dealerships were
expanded and modified so as to cater to both Daihatsu as well as Toyota vehicles. To meet the
growing need, ten more 3-S outlets of the same high standard were added. Overall now, with
twenty-seven dealership outlets, your company is able to offer prompt maintenance facilities for both
Toyota and Daihatsu vehicles. This has also had the benefit of increasing sales volumes and
revenues, while also ensuring that the vehicles have a longer life and higher resale value.
SPARE PARTS
Warehouse modification was also attended to as pad of the ground-work preparation for the
Daihatsu Cuore. The new product necessitated adjustments in respect of spare parts, and the
company warehouse was therefore expanded and delivery systems improved and updated to meet
added requirements. Stocking systems were re-worked to ensure that dealerships maintained
enough stocks to meet demand. In addition, procedures were streamlined to ensure
nationwide accessibility and delivery of spare pads from the central pads warehouse at Karachi
within 24 to 36 hours.
Recently the government has taken bold steps to document the economy and discourage
smuggling. This positive stance has lead to a reduction in the availability of smuggled parts and
an increase in the sale of genuine parts which are duty paid. Government action in this area will
boost sales of genuine parts and further increase government revenue. The steps taken by the
government in this field have been welcomed, as this will restrict sales of non-revenue earning
smuggled parts, and encourage revenue-generating sales.
HUMAN RESOURCE DEVELOPMENT
A cornerstone of human resources development, our annual Kaizen convention is a morale boosting
exercise that acknowledges and honours staff members and vendors who make significant
contributions by boosting efficiency, improving productivity and quality and adding to cost saving.
This event is based on the Japanese system of  continuous improvement. The convention was held          
in July this year, and Dr. Ata-ur-Rehman, Minister for Science & Technology was our special guest.
The convention was widely attended by vendors, members from educational institutions and
corporations. The winning teams received awards, and as customary, the first prize winners will be
sent to attend the Toyota Kaizen Convention in Japan.
Human resource development is an on-going process, but this was intensified and diversified to
meet the demands of Daihatsu Cuore. Special training aimed at improving selling skills were
directed at dealers focusing on the features of Cuore. Vendor training was also expanded to
include production skills for Daihatsu parts. Engineers and technicians involved in production
were sent for on-the-job training to Daihatsu Motors in Japan in order to be able to meet quality
standards of Cuore vehicles.
PRODUCT DEVELOPMENT & QUALITY ASSURANCE
Your company was faced with the immediate challenge of increasing production capacity and
reducing operation costs while operating in a single shift. Also, production of Cuore was to begin
with over 40 per cent local content. Your company proved itself equal to this challenge and on a
single shift basis, plant capacity increased from 10,000 to 15,000 units. Simultaneously, deletion
targets set by the Engineering Development Board for Toyota vehicles has also been met. Toyota,
Daihatsu and Indus engineers pooled resources and worked together single-mindedly to meet
these goals without any compromise on quality.
GOVERNMENT POLICY
Inspite of political and economic uncertainty that faced the country, the policies of the government
with regard to this industry remained consistent and the guidance of the Engineering Development
Board led to a growth in investments in the industry.
The WTO Agreement is being reviewed by the Engineering Development Board and new policies
are being formulated to sustain government support and maintain the current local program
which has already proved to be successful. The first goal of the government is to continue the
current localization policy for a period of 5 years or alternatively to continue to support the industry
through a tariff based system. We are confident that the government will take measures to ensure
the long-term development of the industry which will contribute to the economic well-being of the
nation.
FUTURE OUTLOOK
It is estimated that the total revenue paid by automobile manufacturers during 1999-2000 was
over Rs. 7 billion. Inspite of the depressed economic scenario, the Auto Industry has
continued to expand, creating new jobs and contributing to government revenues. Countries
like Thailand whose population size is just half of ours, boast of volumes of over 500,000 vehicles
per annum, whereas we list only 50,000 units in Pakistan. This industry has the potential to
generate jobs and be a huge employer. If encouraged with incentives, the benefits will fall to
the government by way of revenue generation.
With several constraints and such uncertain economic conditions, new entrants in the market and
increased competition, your company has continued to grow by way of capacity utilization and sales
volumes. The Corolla is firmly entrenched in the market and together with the Hilux model change,
launch of the Daihatsu Cuore and expansion of the dealer network, your Company is well prepared to
meet the challenges of the new millennium.
We thank the customers of Toyota and Daihatsu, our dealers, vendors, staff members and team
members for their trust, support and commitment. We extend special thanks to the government, in
particular the Ministry of Industries and Ministry of Commerce, and the Engineering Development Board
as well as our bankers for their sustained support.
We thank Allah for his blessings and pray for greater success.
Ali S. Habib
Chairman
AUDITORS' REPORT TO THE MEMBERS
W e have audited the annexed balance sheet of  INDUS MOTOR COMPANY LIMITED as at June
30, 2000 and the related profit and loss account and the statement of changes in financial
position, together with the notes forming part thereof, for the year then ended and we state that we have
obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit and, after due verification thereof, we report that:
(a) in our opinion, proper books of accounts 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 accounts and are further in accordance with accounting policies consistently
applied;
(ii) the expenditure incurred during the year was for the purpose of the company's business; and
(iii) the business conducted, investments made and the expenditure incurred during the year
were in accordance with the objects of the company;
(c) in our opinion and to the best of our information and according to the explanations given to us, the
balance sheet, profit and loss account and the statement of changes in financial position, together
with the notes forming part thereof, give the information required by the Companies Ordinance,
1984, in the manner so required and respectively give a true and fair view of the state of the
company's affairs as at June 30, 2000 and of the profit and the changes in financial position for the
year then ended; and
(d) in our opinion Zakat deductible at source under the Zakat and Ushr Ordinance, 1980wasdeducted
by the Company and deposited in the Central Zakat Fund established under section 7 of that
Ordinance.
Karachi Ford, Rhodes, Robson, Morrow
Dated: September 22, 2000 Chartered Accountants
BALANCE SHEET
AS AT JUNE 30, 2000
Note 2000 1999
(Rs. in '000)
ASSETS
NON-CURRENT ASSETS
Fixed assets - Tangible
Operating fixed assets at cost
less accumulated depreciation 3 1,254,360 958,644
Capital work-in-progress 4 1,607 108,477
------------ ------------
1,255,967 1,067,121
Long-term investment 5 1,200 1,875
Long-term loans 6 687 85
Long-term deposits 3,304 5,925
CURRENT ASSETS
Stores and spares 7 60,334 86,033
Stock-in-trade 8 1,022,652 856,419
Trade debts 9 582,738 443,899
Loans, advances and prepayments 10 211,803 129,952
Other receivables 11 28,542 24,768
Cash and bank balances 12 322,499 488,294
------------ ------------
2,228,568 2,029,365
------------ ------------
TOTAL ASSETS 3,489,726 3,104,371
========== ==========
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Share Capital
Authorised
100,000,000 (1999:100,000,000) 1,000,000 1,000,000
Ordinary shares of Rs. 10 each ========== ==========
Issued, subscribed and paid-up
78,600,000 Ordinary shares of
Rs. 10 each fully paid in cash 786,000 786,000
Reserves 13 764,414 710,060
------------ ------------
NON-CURRENT LIABILITIES 1,550,414 1,496,060
Long-term loans 14 238,301 324,683
Deferred taxation 15 169,911 110,911
CURRENT LIABILITIES
Current maturities of long term loans 16 86,382 14,268
Short term running finances 17 141,314 406,343
Creditors, accrued and other liabilities 18 1,185,504 594,906
Proposed dividend 117,900 157,200
------------ ------------
1,531,100 1,172,717
CONTINGENCIES AND COMMITMENTS 19 ------------ ------------
TOTAL EQUITY AND LIABILITIES 3,489,726 3,104,371
========== ==========
The annexed notes form an integral part of these accounts.
Farhad Zulficar Yutaka Arae
Chief Executive Officer & Director Vice Chairman & Director
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED JUNE 30, 2000
2000 1999
Note (Rs. in '000)
SALES - net 20 8,246,268 6,957,876
Cost of sales 20 7,701,927 6,222,077
------------ ------------
GROSS PROFIT 544,341 735,799
Administration and selling expenses 20 251,349 227,522
------------ ------------
OPERATING PROFIT 292,992 508,277
Financial charges 34,409 47,006
Other charges 22,618 41,320
------------ ------------
57,027 88,326
235,965 419,951
Other income 23 44,265 81,359
------------ ------------
PROFIT BEFORE TAXATION 280,230 501,310
PROVISION FOR TAXATION
Current 24 53,476 177,972
Prior (4,500) 11,138
Deferred 59,000 60,911
------------ ------------
107,976 250,021
------------ ------------
NET PROFIT FOR THE YEAR 172,254 251,289
UNAPPROPRIATED PROFIT BROUGHT FORWARD 60 971
------------ ------------
PROFIT AVAILABLE FOR APPROPRIATION 172,314 252,260
APPROPRIATIONS
Transfer to general reserves 54,000 95,000
Proposed dividend @ 15% (1999: 20%) 117,900 157,200
------------ ------------
171,900 252,200
UNAPPROPRIATED PROFIT CARRIED FORWARD
TO REVENUE RESERVES 414 60
========== ==========
BASIC EARNINGS PER SHARE 25 2.19 3.20
========== ==========
The annexed notes form an integral part of these accounts.
Farhad Zulficar Yutaka Arae
Chief Executive Officer & Director Vice Chairman & Director
STATEMENT OF CHANGES IN FINANCIAL POSITION (CASH FLOW STATEMENT)
FOR THE YEAR ENDED JUNE 30, 2000
Note 2000 1999
(Rs. in '000)
CASH FLOW FROM OPERATING ACTIVITIES
Cash generated from operations 26 756,655 (400,605)
Financial charges paid (41,358) (26,085)
Income tax paid (118,825) (233,865)
Long term deposits 2,621 837
Long term loans - net (602) 449
----------- -----------
NET CASH INFLOW / (OUTFLOW)
FROM OPERATING ACTIVITIES 598,491 (659,269)
CASH FLOW FROM INVESTING ACTIVITIES
Fixed capital expenditure (340,407) (213,592)
Sale proceeds of fixed assets 17,305 12,995
Long term investment -- (750)
----------- -----------
NET CASH OUTFLOW FROM INVESTING ACTIVITIES (323,102) (201,347)
----------- -----------
275,389 (860,616)
CASH FLOW FROM FINANCING ACTIVITIES
Long term loan borrowed -- 283,799
Repayment of Locally Manufactured Machinery Loan (14,268) (6,725)
Repayment of suppliers credit loan -- (54,806)
Dividend paid (161,887) (113,737)
----------- -----------
NET CASH (OUTFLOW) / INFLOW
FROM FINANCING ACTIVITIES (176,155) 108,531
----------- -----------
NET INCREASE/(DECREASE) IN CASH
AND CASH EQUIVALENTS 99,234 (752,085)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF THE YEAR 27 81,951 834,036
CASH AND CASH EQUIVALENTS AT END ------------ ------------
OF THE YEAR 27 181,185 81,951
========== ==========
Farhad Zulficar Yutaka Arae
Chief Executive Officer & Director Vice Chairman & Director
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED JUNE 30, 2000
1. COMPANY BACKGROUND, OPERATION AND LEGAL STATUS
The company was formed in accordance with the terms of a joint venture agreement concluded
amongst House of Habib, Toyota Motor Corporation and Toyota Tsusho Corporation for the
purpose of assembling, progressive manufacturing and marketing of Toyota vehicles. The
company is also the sole distributor of Toyota Vehicles in Pakistan. The company acquired the sole
distributorship of Daihatsu vehicles in Pakistan and concluded an agreement for the progressive
assembling/manufacturing of Daihatsu vehicles in Pakistan.
The company was incorporated in Pakistan as a public limited company in December, 1989 and
started commercial production in May, 1993. The shares of the company are quoted on the stock
exchanges in Pakistan.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2.1 Accounting convention
These accounts have been prepared under the historical cost convention.
2.2 Tangible fixed assets and depreciation
These are stated at cost less accumulated depreciation except for capital work-in-progress
which is stated at cost. The rates of depreciation are stated in note 3 to the accounts.
Depreciation on all fixed assets except on leasehold land is charged to income from the
month of acquisition applying the reducing balance method whereby the cost of an asset is
written off over its estimated useful life and on disposal upto the month preceding the month
of disposal.
Lease hold land is amortized over the period of lease.
Maintenance and normal repairs are charged to income as and when incurred.
Gains or loss on sale or retirement of fixed assets is included in income currently.
2.3 Capitalization of borrowing cost
The company capitalizes borrowing cost exclusively obtained for capital projects.
2.4 Stores and spares
Stores and spares are valued at cost on moving average basis.
2.5 Stock-in-trade
Raw materials are valued at cost on moving average basis except for those in transit which
are stated at invoice price plus other charges paid thereon to the balance sheet date.
CBU/Own manufactured vehicles/spare pads in hand are valued at the lower of cost and net
realisable value. Costs is determined on moving average basis.
Work-in-process is valued at material cost consisting of CKD kits and local vendor parts.
Net realisable value signifies the estimated selling price in the ordinary course of business
less costs necessary to be incurred to make the sale.
2.6 Staff retirement benefits
The Company operates an approved provident fund scheme for all of its employees.
Contributions in respect thereof are made in accordance with the terms of the scheme.
The company also operates an approved funded pension scheme for its employees. The
scheme provides life pension to employees and thereafter to their spouse. Contributions are
made annually to this fund on the basis of actuarial recommendations. Actuarial valuation of
the scheme is carried out annually and the latest valuation was carried out at June 30, 2000.
The fair value of the Scheme's assets and liabilities for past services of the employees at the
latest valuation date carried out using the projected unit credit method are as follows:
2000
(Rs. in '000)
Actuarial liability 14,435
Fair value of plan assets (Fund balance) 8,639
------------
Unfunded actuarial liability 5,796
Unrecognised:
Transitional obligation (6,184)
Actuarial gain 1,545
------------
Accrued cost 1,157
==========
The following amounts have been charged in the profit and loss account
during the current year in respect of these schemes:
Service cost 2,672
Interest cost - net 729
Amortisation of transitional obligation 1,546
------------
Total pension cost 4,947
==========
The future contribution rate of 10.33% of the basic salary includes allowances for deficits that
will be contributed over the period upto four years. Projected Unit Credit method, using
following significant assumptions, is used for valuation of the scheme:
Expected rate of increase in salaries at 11% per annum.
Expected rate of interest on investment at 12% per annum.
2.7 Foreign currency translation
Transactions in foreign currencies are translated into rupees at the rates of exchange ruling
on the date of the transactions. Assets and liabilities expressed in foreign currencies are
translated into Pak Rupees at the rate of exchange prevailing at the balance sheet date
except where forward exchange contracts have been entered into in which case the contract
rates are applied.
Exchange differences are included in income currently.
2.8 Investments
Investments are stated at cost less provision for permanent diminution in the value of
investment.
2.9 Revenue recognition
(i) Sales are recognised as revenue when goods are delivered and invoiced.
(ii) Return on deposits is recognised as revenue on accrual basis.
(iii) Agency commission is recognised when shipments are made by the principal.
(iv) Mark-up on advances to suppliers and contractors is accounted for on an accrual basis.
2.10 Taxation
Current
Provision for current taxation is based on taxable income at the current rates of taxation after
taking into account tax rebates and credits available, if any, or one half percent of turnover,
whichever is higher.
Deferred
The company accounts for deferred taxation arising on major timing differences using the
liability method.
2.11 Warranty obligations
These are accounted for on accrual basis on estimates of such obligations.
2.12 Financial instruments
This includes long term investment, cash, trade receivables, trade creditors and certain other
assets and liabilities. The fair value of financial assets and liabilities are not different from
their carrying values at the balance sheet date.
3. OPERATING FIXED ASSETS
Accumulated Written Depreciation
Cost as at Additions/ Cost as at depreciation down
Assets July 1, 1999 (Deletions) June 30, 2000 as at value as at Charge Rate (%) /
June 30, 2000 June 30, 2000 for the year period
---------------------------------------(Rs. in '000)--------------------------------------
Leasehold land 38,662 -- 38,662 2,762 35,900 921 42 years
Buildings on leasehold land
- factory 215,698 -- 215,698 104,455 111,243 12,360 10
- others 47,520 348 47,868 13,279 34,589 1,810 5
Plant and machinery 1,107,536 137,915 1,245,451 556,089 689,362 66,108 10
Furniture and fixtures 17,113 1,294 18,086 7,952 10,134 1,505 10 - 20
(321 )
Office equipment 18,522 936 19,145 8,446 10,699 1,562 10 - 20
(313)
EDP equipment 43,154 2,584 45,587 21,737 23,850 6,983 10 - 33
(151)
Jigs and fixtures 63,082 167,021 230,103 72,482 157,621 22,782 20 - 50
Tools and equipment 44,749 118,526 163,275 21,607 141,668 11,057 10 - 20
Vehicles 75,437 18,652 69,650 30,356 39,294 10,418 20
(24,439)
------------ ------------ ------------ ------------ ------------ ------------
2000 1,671,473 447,276 2,093,525 839,165 1,254,360 135,506
(25,224)
========== ========== ========== ========== ========== ==========
1999 1,585,039 105,941 1,671,473 712,829 958,644 110,788
(19,507)
========== ========== ========== ========== ========== ==========
3.1 Additions to fixed asset includes an amount of Rs. 27.862 million in respect of borrowing cost.
3.2 Depreciation charge for the year has been allocated as follows:
Note 2000 1999
(Rs. in '000)
Cost of goods manufactured 20.1 115,934 91,009
Administration and selling expenses 20.2 19,572 19,779
----------- -----------
135,506 110,788
========== ==========
3.3 Assets disposed off during the year:
Accumulated   Sales Mode of
Assets Cost Depreciation  Book Value Proceeds Disposal Particulars of Buyers
------------------(Rs. in '000)----------------------
Furniture & fixture
Written down value not
exceeding Rs. 5,000 each 321 133 188 141 By negotiation Various Employees & Customers
Office equipment 34 16 18 16 By negotiation Mr. Waheed Niazi, Karachi
- do - 42 20 22 21 By negotiation Col. Masood, Karachi
- do - 20 9 11 12 By negotiation Mr. Hanif, Karachi
- do - 20 9 11 11 By negotiation Mrs. Sato, Karachi
- do - 20 9 11 11 By negotiation Mrs. Sato, Karachi
- do - 19 9 10 11 By negotiation Mrs. Sato, Karachi
- do - 19 9 10 11 By negotiation Mr. Nadeem, Karachi
- do - 19 9 10 12 By negotiation Mr. Nadeem, Karachi
- do - 11 5 6 6 By negotiation Mrs. Sato, Karachi
- do - 11 5 6 7 By negotiation Mr. Zaheer, Karachi
- do - 22 10 12 12 By negotiation Mrs. Sato, Karachi
- do - 14 9 5 6 By negotiation Mr. Khalid, Darayus & All Raza (Employees)
- do - 21 10 11 9 By negotiation Mr. Darayus (Employee)
- do - 21 10 11 9 By negotiation Mr. Darayus (Employee)
- do - 141 47 94 131 insurance claim Adamjee Insurance Company Ltd., Karachi
Written down value not
exceeding Rs. 5,000 each 30 14 16 18 By negotiation Various Employees & Customers
Vehicles 1,451 794 657 506 By negotiation Mr. Aslam Ahmed Malik
- do - 841 339 502 615 By negotiation M/s. S.S. Transport
- do - 741 86 655 741 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 741 108 633 741 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 741 108 633 741 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 789 90 699 789 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 340 200 140 390 By negotiation Mr. Musarat Laiq (Employee)
- do - 349 238 111 115 By negotiation Mr. Asad All Shah (Employee)
- do - 264 179 85 86 By negotiation Mr. Quresh Tambawala (Employee)
- do - 272 186 86 89 By negotiation Mr. Faroukh Nazir (Employee)
- do - 357 242 115 117 By negotiation Mr. Habibuddin Sharif (Employee)
- do - 348 238 110 114 By negotiation Mr. Azam Akhtar (Employee)
- do - 389 265 124 127 By negotiation Mr. Tariq Ahmed Khan (Employee)
- do - 934 106 828 869 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 741 119 622 741 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 741 97 644 741 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 741 141 600 741 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 857 397 460 826 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 784 104 680 799 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 869 87 782 869 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 436 350 86 200 By negotiation Mr. Abdul Waris (Employee)
- do - 672 438 234 250 By negotiation Mr. SM Nafees, S.S. Transport
- do - 39 29 10 20 By negotiation Mr. Darayus (Employee)
- do - 784 118 666 700 By negotiation Mr. Muhammad Umer (Employee)
- do - 784 118 666 700 By negotiation Mr. Abdul Majeed Karachi
- do - 934 195 739 760 By negotiation Mr. Gul Sher, Karachi
- do - 672 438 234 325 By negotiation Mr. Musarat Liaq (Employee)
- do - 491 49 442 491 Insurance claim Adamjee Insurance Company Ltd., Karachi
- do - 2,050 1,221 829 901 By negotiation Mr. Fahad All Azhar, Karachi
- do - 380 250 130 130 By negotiation Mr. Darayus (Employee)
- do - 669 232 437 602 By negotiation Mr. Ahmed Nadeem (Employee)
- do - 923 207 716 745 By negotiation Mr. M. Nawab, Karachi
- do - 784 131 653 710 By negotiation Mr. Zarbad Shah Afridi, Karachi
- do - 690 505 185 460 By negotiation Mr. Farukh Islam, Karachi
- do - 841 431 410 500 By negotiation M/s. Engineering Development Board
========== ========== ========== ==========
25,224 9,169 16,055 18,695
========== ========== ========== ==========
ADDITIONS/
2000 (TRANSFERS)/ 1999
ADJUSTMENT*
Rs. in '000
4. CAPITAL WORK-IN-PROGRESS
Civil works 225 573 --
(348)
Plant and Machinery 817 63,979 74,713
(137,875)
Tools and Equipment 565 103,008 27,301
(118,112)
(11,632) *
Furniture and fixtures -- -- 1,667
(1,164)
(503) *
Office equipment -- 217 482
(699)
Jigs and fixtures -- 12,510 4,314
(16,824)
------------ ------------ ------------
1,607 (106,870) 108,477
========== ========== ==========
Note 2000 1999
(Rs. in '000)
5. LONG TERM INVESTMENT
Automotive Testing & Training Centre
(Private) Limited (AT&TC)
187,500 (1999: 37,500) Ordinary shares of Rs. 10 each 1,875 375
Advance against shares -- 1,500
------------ ------------
1,875 1,875
Less: Provision for diminution in
the value of investment 22 675 --
Value of the company's investment on
net assets basis as per unaudited
accounts of AT&TC for the year ended ------------ ------------
June 20, 2000 is Rs. 1.2 million 1,200 1,875
========== ==========
5.1 The equity based on the issued capital of AT&TC works out to 12.82% (1999: 14.29%) and
the Chief Executive is Mr. Ramzan Ali Khawaja.
6. LONG TERM LOANS - considered good
Executives 654 27
Staff 33 58
------------ ------------
687 85
========== ==========
6.1 The maximum aggregate amount due from executives at the end of any month during the
year was Rs. 1.869 (1999: Rs. 1.589) million.
The loans have been provided to executives and staff of the company as per the terms of
their employment and are repayable over a period of twenty to twenty four months.
Note 2000 1999
(Rs. in '000)
7. STORES AND SPARES
Stores 37,297 63,021
Spares 23,037 23,012
------------ ------------
60,334 86,033
========== ==========
8. STOCK-IN-TRADE
Manufacturing Stock
Raw materials and components 344,451 279,906
Work-in-process 127,633 100,398
Finished goods (vehicles - own manufactured) 61,487 113,939
Trading Stock
Vehicles - in hand 61,684 70,290
- bond 1,017 1,017
Spare parts 39,323 53,924
Special service tools and publications 1,113 1,289
------------ ------------
103,137 126,520
In Transit 385,944 235,656
------------ ------------
1,022,652 856,419
========== ==========
9. TRADE DEBTS
Considered good - unsecured
Government agencies 26,912 96,414
Others 555,826 347,485
------------ ------------
582,738 443,899
========== ==========
9.1 The maximum aggregate amount due from associated undertakings at the end of any month
during the year was Rs. Nil (1999: Rs. 0.979) million.
10. LOANS, ADVANCES AND PREPAYMENTS
Loans and advances - considered good
Executives 1,876 2,016
Staff 1,012 1,612
------------ ------------
2,888 3,628
Advances to suppliers and contractors 74,396 64,229
Advance income-tax - net 129,756 59,908
------------ ------------
207,040 127,765
Prepayments
Rent 255 2,180
Insurance 4,508 7
------------ ------------
4,763 2,187
------------ ------------
211,803 129,952
========== ==========
10.1 The maximum aggregate amount due from executives at the end of any month during the
year was Rs. 2.154 (1999: Rs. 1.279) million.
11. OTHER RECEIVABLES - considered good
Octroi refundable 3,664 11,567
Sales tax -- 2,572
Earnest money 867 763
Warranty claim, agency commission
and other receivables from an
associated undertaking 11.1 9,415 1,891
Return on bank deposits 9,528 4,167
Receivable against sale of fixed assets 1,915 525
Warranty claims receivable from local vendors 2,945 2,776
Insurance claims 208 507
------------ ------------
28,542 24,768
========== ==========
11.1 The maximum aggregate amount due from an associated undertaking at the end of any
month during the year was Rs. 11.822 (1999: Rs. 16.831) million.
11.2 Other receivables include an amount of Rs. 9.415 (1999: Rs. 3.708) million due in foreign
currency mainly in Japanese Yen.
Note 2000 1999
(Rs. in '000)
12. CASH AND BANK BALANCES
In hand
Cash 1,532 1,054
Cheques -- 46,261
------------ ------------
1,532 47,315
At banks in
Current accounts 39,970 302,172
Deposit accounts 12.1 280,997 138,807
------------ ------------
320,967 440,979
------------ ------------
322,499 488,294
========== ==========
12.1 Bank deposits represent U.S. Dollar deposit equivalent Rs. 108.986 (1999: Rs. 102.800)
million and Rupee deposits amounting to Rs. 172.011 (1999: Rs. 35.757) million with banks
with an effective rate of interest of 3.5% and 10% (1999: 4.5% and 13.5%) respectively.
13. RESERVES
Capital reserve
Premium on issue of Ordinary shares 196,500 196,500
Revenue reserves
General reserve
Balance brought forward 513,500 418,500
Transferred from Profit and Loss account 54,000 95,000
----------- -----------
567,500 513,500
Unappropriated profit 414 60
----------- -----------
764,414 710,060
========== ==========
14. LONG TERM LOANS- secured
Locally Manufactured Machinery loan 14.1 40,884 55,152
Less: Current maturity shown under current liabilities 16 15,432 14,268
----------- -----------
25,452 40,884
Term loan 14.2 283,799 283,799
Less: Current maturity shown under current liabilities 16 70,950 --
----------- -----------
212,849 283,799
----------- -----------
238,301 324,683
========== ==========
14.1 This represents local currency financing obtained from Muslim Commercial Bank Limited by
selling the plant and machinery for Rs. 100 million and repurchasing it back for Rs. 147.205
million, calculated at a mark-up of 8% per annum under locally manufactured machinery
(LMM) scheme of the State Bank of Pakistan. The principal and mark-up is payable semi-
annually in sixteen equal installments, commencing from January 1995. The above finance is
secured against a bank guarantee provided by Emirates Bank International, Karachi and a
demand promissory note. The Emirates Bank guarantee has been secured by a first
equitable mortgage charge on fixed assets ranking pari passu with other major creditors.
14.2 This represents local currency loan obtained from Habib Bank Limited for a period of five
years including a grace period of one year. The principal is payable semi-annually in eight
equal installments and mark-up is payable semi annually from the draw down date. The loan
carries mark-up ranging from 14% to 16% (1999: 16%) per annum. The loan is secured by
way of equitable mortgage on present as well as future assets of the company ranking pari-
passu with the loan referred to in note 14.1.
Note 2000 1999
(Rs. in '000)
15. DEFERRED TAXATION
Deferred liability arising due to accelerated
tax depreciation allowances 110,911 169,911
========== ==========
16. CURRENT MATURITIES OF LONG TERM LOANS
Locally Manufactured Machinery loan 14 15,432 14,268
Term loan 14 70,950 --
------------ ------------
86,382 14,268
========== ==========
17. SHORT TERM RUNNING FINANCES
Under mark-up arrangements - secured 141,314 406,343
========== ==========
The facilities for running finance available from various commercial banks amount to Rs. 1,155
(1999: Rs. 1,050) million. The rates of mark-up range from Re. 0.29 to Re. 0.34 (1999: Re. 0.38 to
Re. 0.41) per Rs. 1,000 per day or part thereof on the outstanding balance. The purchase prices
are payable on various dates by April 30, 2001 and are renewable. These arrangements are
secured by way of pari-passu charge against hypothecation of stock and trade debts.
18. CREDITORS, ACCRUED AND OTHER LIABILITIES
Creditors
Associated undertakings 229,891 1,313,551
Other trade creditors 204,469 94,622
----------- -----------
434,360 225,977
Accrued liabilities
Accrued expenses 117,722 62,636
Mark-up on secured long term loans 1,635 2,330
Mark-up on secured short term running finances 664 11,209
----------- -----------
120,021 76,175
Other liabilities
Advances from customers and dealers 433,503 185,864
Commission payable 24,890 198
Royalty payable to:
- associated undertaking 61,032 30,145
- other 26,272 --
Technical fee -- 3,112
Warranty obligations 22,501 20,097
Retention money 2,002 1,050
Workers' profit participation fund 18.1 14,833 26,925
Workers' welfare fund 2,062 10,546
Sales tax payable 33,334 --
Tax deducted at source 5,707 4,552
Payable to employees 2,788 3,379
Unclaimed dividend 2,199 6,886
----------- -----------
631,123 292,754
----------- -----------
1,185,504 594,906
========== ==========
Creditors and other liabilities includes Rs. 304.113 (1999: 144.231) million due in foreign
currency mainly in Japanese Yen.
18.1 Workers' Profit Participation Fund
Opening balance 26,925 14,590
Add: Allocation for the year 14,833 26,925
Interest on funds utilised in the company's business 1,947 944
------------ ------------
16,780 27,869
------------ ------------
43,705 42,459
Less: Paid during the year 28,872 15,534
------------ ------------
14,833 26,925
========== ==========
19. CONTINGENCIES AND COMMITMENTS
Contingencies
19.1 The outstanding bank guarantees have been issued under certain supply contracts and to a
bank as security of loan referred to in note 14.1 and to shipping companies for release of
consignment documents. The post dated cheques have been issued to the Collector of
Customs against the concessional rate of duty. The aggregate of these amounts to Rs. 1,830
(1999: Rs. 2,352) million.
19.2 The tax assessment for the assessment years upto 1999/2000 (accounting year ended June
30, 1999) have been finalised. However, the Income Tax department has issued a notice to
reopen the assessment for the year 1991/92 under section 80C (5), which is being contested
by the Company in the High Court of Sindh. Pending outcome of the matter, no provision has
been made in the accounts for additional tax claimed amounting to Rs. 7.899 million as the
management is confident that the outcome will be decided in favour of the Company.
Commitments
19.3 Commitments in respect of capital expenditure as at June 30, 2000 amounts to Rs. 5.5 (1999:
Rs. 51.507) million.
19.4 Commitments in respect of letters of credit, other than for capital expenditure, amounts to
Rs. 402.260 (1999: Rs. 153.680) million.
20. OPERATING RESULTS
Manufacturing Trading Total
Note 2000 1999 2000 1999 2000 1999
--------------------------------------------------(Rs. in '000)-----------------------------------------------------
Sales 8,057,721 6,735,195 404,104 413,166 8,461,825 7,148,361
Commission and discounts 207,188 178,000 8,369 12,485 215,557 190,485
----------- ----------- ----------- ----------- ----------- -----------
Net sales 7,850,533 6,557,195 395,735 400,681 8,246,268 6,957,876
Cost of sales
Opening stock 113,939 27,476 126,520 95,986 240,459 123,462
Cost of goods manufactured 20.1 7,315,755 5,969,311 -- -- 7,315,755 5,969,311
Purchases -- -- 312,316 369,763 312,316 369,763
Closing stock (61,487) (113,939) (103,137) (126,520) (164,624) (240,459)
Vehicles sent to DMC (1,979) -- -- -- (1,979) --
----------- ----------- ----------- ----------- ----------- -----------
7,366,228 5,882,848 335,699 339,229 7,701,927 6,222,077
----------- ----------- ----------- ----------- ----------- -----------
Gross profit 484,305 674,347 60,036 61,452 544,341 735,799
Administration and
selling expenses 20.2 238,793 214,293 12,556 13,229 251,349 227,522
----------- ----------- ----------- ----------- ----------- -----------
Operating profit 245,512 460,054 47,480 48,223 292,992 508,277
Other charges 22 22,354 38,941 264 2,379 22,618 41,320
----------- ----------- ----------- ----------- ----------- -----------
55,790 83,938 1,237 4,388 57,027 88,326
----------- ----------- ----------- ----------- ----------- -----------
189,722 376,116 46,243 43,835 235,965 419,951
Other income 23 35,976 59,394 8,289 21,965 44,265 81,359
----------- ----------- ----------- ----------- ----------- -----------
Profit before taxation 225,698 435,510 54,532 65,800 280,230 501,310
========== ========== ========== ========== ========== ==========
Note 2000 1999
(Rs. in '000)
20.1 Cost of Goods Manufactured
Raw material and vendor parts consumed
Opening stock 279,906 272,132
Purchases 6,967,256 5,698,450
Closing stock (344,451) (279,906)
----------- -----------
6,902,711 5,690,676
Stores and spares consumed 136,932 123,512
Salaries, wages and other benefits 63,875 56,977
Rent, rates and taxes 2,126 1,581
Repairs and maintenance 9,261 4,859
Depreciation 3.2 115,934 91,009
Legal and professional 3 3
Travelling and entertainment 9,040 3,440
Transportation 250 108
Insurance 6,218 6,334
Vehicle running 4,679 3,503
Communication 3,588 2,396
Printing, stationery and office supplies 1,348 1,211
Subscription 49 100
Utilities 41,401 40,204
Running royalty 35,557 33,179
Technical fee 8,741 961
Parts development 378 908
Miscellaneous 899 178
Opening stock of work-in-process 100,398 8,570
Closing stock of work-in-process (127,633) (100,398)
----------- -----------
413,044 278,635
----------- -----------
7,315,755 5,969,311
========== ==========
Salaries, wages and other benefits includes Rs. 2.979 (1999: Rs. 2.703) million in respect of staff
retirement benefits.
20.2 Administration and Selling Expenses
Salaries, allowances and other benefits 76,746 58,712
Rent, rates and taxes 2,312 2,059
Insurance 2,194 2,234
Repairs and maintenance 9,352 6,635
Depreciation 3.20 19,572 19,779
Advertising and sales promotion 48,413 41,796
Travelling and entertainment 14,740 14,207
Legal and professional 7,957 12,979
Vehicle running 8,912 8,201
Communication 8,491 8,904
Printing, stationery and office supplies 2,756 3,055
Staff training 8,072 6,268
Staff transport and canteen 23,266 21,970
Security 2,598 2,764
Subscription 604 1,268
Warranty claims and pre-delivery inspection 5,681 5,456
Research & development 1,471 1,556
Utilities 865 1,260
Share registrar and related expenses 3,205 3,248
Transportation 3,337 4,703
Running royalty 805 468
------------ ------------
251,349 227,522
========== ==========
Salaries, allowances and other benefits includes Rs. 4.402 (1999: Rs. 3.426) million in respect of
staff retirement benefits.
The administration and selling expenses have been allocated between manufacturing and trading
activities on the basis of turnover.
21. FINANCIAL CHARGES
Long Term Loans
Guarantee commission 658 1,225
Mark-up on Locally Manufactured Machinery 13,495 4,681
Mark-up on Suppliers Credit -- 3,106
Exchange risk cover fee and project monitoring fee -- 3,113
------------ ------------
14,153 12,125
Working Capital
Guarantee commission 488 179
Mark-up on shod term borrowings 15,477 30,010
Bank charges 2,344 3,748
Interest on Workers' Profit Participation Fund 1,947 944
------------ ------------
20,256 34,881
------------ ------------
34,409 47,006
========== ==========
22. OTHER CHARGES
Auditors' remuneration 22.1 1,652 809
Workers' profit participation fund 14,833 26,925
Workers' welfare fund 1,604 10,231
Provision against diminution in the value of investment 5 675 --
Donations 22.2 3,854 3,355
------------ ------------
22,618 41,320
========== ==========
22.1 Auditors' remuneration
Audit fee 225 175
Tax services 75 75
Other advisory and consultancy services
and certification fee 1,327 486
Out of pocket expenses 25 73
------------ ------------
1,652 809
========== ==========
22.2 Donations were not made to any donee in whom a director or his spouse had any interest at
any time during the year except for donations of Rs. 0.060 (1999: Rs. 0.060) million to
Mohammedali Habib Welfare Trust, Karachi and Rs. 0.700 (1999: Rs. 0.700) million to Habib
Education Trust, Karachi in which one of the directors is a trustee.
23. OTHER INCOME        
Agency commission 23.10 6,476 18,349
Gain on sale of fixed assets 2,640 2,599
Return on bank deposits 16,461 45,514
Mark-up on advances to suppliers and contractors 15,389 13,808
Exchange gain (net) 823 990
Liabilities written back 2,413 --
Miscellaneous 63 99
------------ ------------
44,265 81,359
========== ==========
23.1 Agency commission
Gross 11,545 20,047
Less: Commission 5,069 1,698
------------ ------------
6,476 18,349
========== ==========
24. PROVISION FOR TAXATION
Current year - presumptive 19,474 24,972
- normal 34,002 153,000
------------ ------------
53,476 177,972
========== ==========
25. BASIC EARNINGS PER SHARE
Basic earnings per share have been computed by dividing the net profit for the year after taxation
with the number of Ordinary shares issued by the company.
26. CASH GENERATED FROM OPERATIONS
Profit before taxation 280,230 501,310
Adjustment for non-cash charges and other items
Depreciation 135,506 110,788
Gain on sale of fixed assets (2,640) (2,599)
Financial charges 30,118 42,314
Provision for diminution in value of investment 675 --
Working capital changes 26.1 312,766 (1,052,418)
------------ ------------
756,655 (400,605)
========== ==========
26.1 Working capital changes
Decrease / (Increase) in current assets
Stores and spares 25,699 (13,920)
Stock-in-trade (166,233) (233,667)
Trade debts (138,839) (251,844)
Loans, advances and prepayments (12,002) (8,506)
Other receivables (2,384) 19,333
Increase / (Decrease) in current liabilities
Creditors, accrued and other liabilities 606,525 (563,814)
------------ ------------
312,766 (1,052,418)
========== ==========
27. CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise of the following items as
included in the balance sheet
Cash and bank balances 322,499 488,294
Short term running finances (141,314) (406,343)
------------ ------------
181,185 81,951
========== ==========
28. REMUNERATION OF CHIEF EXECUTIVE, DIRECTOR AND EXECUTIVES
2000 1999
Executive Director Executives Executive Director Executives
-----------------------------------------------(Rs. in '000)-----------------------------------------------
Managerial remuneration 2,400 2,400 377,061 1,950 1,950] 34,244
Retirement benefits 156 -- 1,991 126 -- 1,714
Utilities 50 169 -- 106 147 --
Leave passage/assistance 837 305 2,027 733 408 2,724
Medical Expenses 82 33 953 131 1 361
------------ ------------ ------------ ------------ ------------ ------------
3,524 2,907 42,677 3,046 2,506 39,043
========== ========== ========== ========== ========== ==========
1 1 86 1 1 83
========== ========== ========== ========== ========== ==========
The company also provides to the Chief Executive, Director and some of its Executives the free
use of cars and residential telephones.
2000 1999
(Rs. in '000)
29. TRANSACTIONS WITH ASSOCIATED UNDERTAKINGS
Aggregate amounts in respect of:
Purchases 4,460,428 3,528,902
Sales -- 7,124
Agency commission 11,545 20,047
Technical fee 8,741 961
Running royalty 36,362 33,179
Share registrar's fee and charges 1,333 1,443
Computer consultancy and softwares -- 991
Transactions with associated undertakings are made under normal commercial terms and
conditions.
30. PLANT CAPACITY AND PRODUCTION
Capacity based on two shift basis (Units) 26,000 20,000
Production (Units) 11,243 10,169
The company is operating on single shift basis,
based on market demand.
31. UNAVAILED CREDIT FACILITIES
Short term running finances 1,013,686 643,657
Morabaha financing 100,000 100,000
----------- -----------
1,113,686 743,657
========== ==========
32. FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES
32.1 Financial assets and liabilities
Interest / Mark-up bearing         Non-Interest / Mark-up bearing
Maturity Maturity Maturity Maturity
upto after Sub-total upto after Sub-total Total
one year one year one year one year
-------------------------------------------------------------Rs. in '000------------------------------------------------------------
FINANCIAL ASSETS
Long term investment -- -- -- -- 1,200 1,200 1,200
Loans and advances to employees 1,437 687 2,124 1,451 -- 1,451 3,575
Long term deposits -- -- -- -- 3,304 3,304 3,304
Trade debts -- -- -- 582,738 -- 582,738 582,738
Other receivables -- -- -- 24,878 -- 24,878 24,878
Cash and bank balances 280,997 280,997 41,502 -- 41,502 322,499
FINANCIAL LIABILITIES
Long term loans 86,382 238,301 324,683 -- -- -- 324,683
Short term running finances 141,314 -- 1,413,141 -- -- -- 141,314
Creditors, accrued and other liabilities -- -- -- 696,065 -- 696,065 696,065
Proposed dividend -- -- -- 117,900 -- 117,900 117,900
32.2 Credit risk exposure
Credit risk represents the accounting loss that would be recognised at the reporting date if
counter parties failed completely to perform as contracted. Out of the total financial assets
of Rs. 938.194 million, the financial assets which are subject to credit risk amounted to
Rs. 586.314 million. The company manages credit risk in trade receivables by limiting
significant exposure to any individual customer by obtaining advance against sales and
coverage under the agreements.
32.3 Interest / mark-up rate risk exposure
The company is exposed to interest / mark-up rate risk on some of the financial obligations.
Significant financial assets / liabilities which are exposed to various rates of interest are
mentioned in the respective notes to the accounts.
32.4 Foreign exchange risk management
Foreign currency risk arises mainly where payables exist due to the transactions with foreign
undertakings, especially group companies. Major payables exposed to foreign currency risks
are covered through forward foreign exchange contracts.
32.5 Fair value of financial asset and liabilities
The carrying values of all financial assets and liabilities reflected in the financial statements
approximate their fair value, except for investments which are valued at book value.
33. STATEMENT OF CHANGES IN EQUITY
Share Capital Capital Reserve Revenue Reserves
Premium on
Issued, issue of
subscribed ordinary General Unappropriated
and paid-up shares reserve profit Total
Rs. in '000
Balance as at June 30, 1998 786,000 196,500 418,500 971 1,401,971
Net profit for the year -- -- -- 251,289 251,289
Transfer to general reserves -- -- 95,000 (95,000) --
Proposed dividend @ 20% -- -- -- (157,200) (157,200)
----------- ----------- ----------- ----------- -----------
Balance as at June 30, 1999 786,000 196,500 513,500 60 1,496,060
Net profit for the year -- -- -- 172,254 172,254
Transfer to general reserves -- -- 54,000 (54,000) --
Proposed dividend @ 15% -- -- (117,900) (117,900)
----------- ----------- ----------- ----------- -----------
Balance as at June 30, 2000 786,000 196,500 567,500 414 1,550,414
========== ========== ========== ========== ==========
34. CORRESPONDING FIGURES
34.1 Previous year's figures have been re-arranged, wherever considered necessary, for the
purposes of comparison.
34.2 Figures have been rounded off to the nearest thousand rupees.
Farhad Zulficar Yutaka Arae
Chief Executive Officer & Director Vice Chairman & Director
PATTERN OF SHARE HOLDING
AS AT JUNE 30, 2000
NUMBER OF TOTAL
SHAREHOLDERS SHAREHOLDING SHARES HELD
575 1 -- 100 56,901
6,954 101 -- 500 3,314,300
979 501 -- 1000 946,750
946 1001 -- 5000 2,504,350
157 5001 -- 10000 1,228,800
48 10001 -- 15000 619,001
31 15001 -- 20000 549,201
16 20001 -- 25000 373,600
7 25001 -- 30000 197,300
9 30001 -- 35000 287,900
9 35001 -- 40000 349,100
2 40001 -- 45000 83,000
3 45001 -- 50000 149,000
2 50001 -- 55000 105,400
2 55001 -- 60000 117,000
3 60001 -- 65000 190,500
1 65001 -- 70000 70,000
1 75001 -- 80000 77,000
3 80001 -- 85000 247,600
1 90001 -- 95000 95,000
6 95001 -- 100000 593,500
1 105001 -- 110000 108,500
1 125001 -- 130000 126,000
1 130001 -- 135000 133,500
1 135001 -- 140000 140,000
1 145001 -- 150000 150,000
1 150001 -- 155000 151,000
1 190001 -- 195000 190,500
1 195001 -- 200000 200,000
1 215001 -- 220000 219,300
4 220001 -- 225000 884,667
1 230001 -- 235000 235,000
1 240001 -- 245000 244,000
1 265001 -- 270000 268,500
3 295001 -- 300000 899,000
1 510001 -- 515000 515,000
1 595001 -- 600000 600,000
1 675001 -- 680000 679,000
1 930001 -- 935000 931,000
1 1435001 -- 1440000 1,435,700
1 1625001 -- 1630000 1,630,000
1 2470001 -- 2475000 2,471,200
1 3255001 -- 3260000 3,260,000
1 4155001 -- 4160000 4,157,533
1 6995001 -- 7000000 7,000,000
2 9820001 -- 9825000 19,650,000
1 20165001 -- 20170000 20,165,397
----------- ----------- ----------- ----------- ----------- -----------
9,787 78,600,000
========== ========== ========== ========== ========== ==========
CATEGORIES OF NUMBER OF SHARES
SHAREHOLDERS SHAREHOLDERS HELD PERCENTAGE
Individuals 9,675 12,531,203 15.943
Investment Companies 17 2,201,200 2.800
Insurance Companies 8 521,100 0.663
Joint Stock Companies 52 6,661,400 8.475
Financial Institutions 8 4,007,600 5.099
Modarabas 7 701,800 0.893
Foreign Investors 17 51,943,297 66.086
Charitable Trusts 2 29,400 0.037
Others 1 3,000 0.004
----------- ----------- -----------
9,787 78,600,000 100.000
========== ========== ==========
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the Eleventh Annual General Meeting of Indus Motor Company Limited
will be held on Friday, December 15, 2000, at 10:00 a.m. at the Auditorium of Finance & Trade
Center, Main Shahra-e-Faisal, Karachi, to transact the following business:
ORDINARY BUSINESS
1. To receive, consider and adopt the audited accounts of the Company for the year ended June 30,
2000 and the report of the Directors and the Auditors thereon.
2. To declare a cash dividend @ 15% i.e. Rs. 1.50 per share.
3. To appoint Auditors and to fix their remuneration for the year ending 30th June, 2001. The present
auditors M/s. Ford, Rhodes, Robson, Morrow, Chartered Accountants, retire and being eligible,
offer themselves for re-appointment.
By order of the Board
Karachi. Shahid Mahmood Khan
November 21,2000 Company Secretary
NOTES:
1. A member entitled to attend and vote at the meeting may appoint a proxy to attend and vote instead of
him/her. Proxy forms must be deposited at the Company's Registered Office not less than 48 hours before the
time for holding the meeting.
2. Shareholders are requested to notify the change in their addresses, if any, immediately.
3. Share Transfer Books of the Company will be closed from December 4, 2000 to December 15, 2000 (both
days inclusive) for the purposes of the Annual General Meeting.
CDC Account Holders will further have to follow the undermentioned guidelines as laid down in Circular 1
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 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 signature shall
be submitted (unless it has been provided earlier) alongwith proxy form to the Company.
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