| Saleem Denim Industries Limited |
|
|
|
|
|
|
|
| Annual
Report 2000 |
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| CONTENTS |
|
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| Companys' Information |
|
|
| Notice
of Annual General Meeting |
|
| Directors' Report |
|
| Auditors'
Report to the members |
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| Balance Sheet |
|
| Profit
and Loss Account |
|
|
| Statement of Changes in Equity |
|
| Statement of Changes in
Financial Position |
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| Notes to the Accounts |
|
| Pattern of Shareholding |
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|
|
| COMPANYS'
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
|
| 1.
MR. TAHIR SALEEM CHAUDHRY |
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| 2.
MR. SHAHID SALEEM CHAUDHRY |
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| 3.
MRS. NASEEM SALEEM CHAUDHRY |
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| 4.
MRS. SOBIA SALEEM |
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| 5.
MR. ABDUL HAQ CHAUDHRY |
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| 6.
MRS. NOSHEEN SHAHID |
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| 7.
MR. ASIF JAMIL ( BEL NOMINEE ) |
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| 8.
MR. ABDUL AZIZ CHAUDHRY |
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| 9.
MR. GHULAM FARID |
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|
| COMPANY
SECRETARY |
|
| MR.
SYED MADAD ALI SHAH |
|
|
| AUDITORS |
|
| M.
ATHER & COMPANY |
|
| Chartered
Accountants |
|
|
| BANKERS |
|
| NATIONAL
BANK OF PAKISTAN |
|
| ASKARI
COMMERCIAL BANK LIMITED. |
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| ALLIED
BANK OF PAKISTAN LIMITED |
|
|
| REGISTERED
OFFICE |
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| 33-
K.M., SHEIKHUPURA ROAD, |
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| FAISALABAD. |
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|
| MILLS |
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| 33-K.M.,SHEIKHUPURA
ROAD, |
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| FAISALABAD. |
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|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the 14th Annual General Meeting of the Shareholders of
SALEEM |
|
| DENIM
INDUSTRIES LIMITED will be held at the Registered Office 33- K.M.,
Sheikhupura |
|
| Road
Faisalabad, on March 31st, 2001 at 10.00 a.m. to transact the following
business:- |
|
|
| 1.
To confirm the minutes of the 13th Annual General Meeting held on 31st March,
2000. |
|
|
| 2.
To receive, consider and adopt the Audited Balance Sheet and Profit and Loss
Account |
|
| of
the Company together with the Directors' and Auditors' Report for the year
ended |
|
| September.30,
2000. |
|
|
| 3.
To appoint Auditors and to fix their remuneration. The retiring Auditors M/S
M. Ather & |
|
| Co.,
Chartered Accountants being eligible offer themselves for reappointment. |
|
|
| 4.
To transact any other lawful business, with the permission of the chair. |
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|
|
On behalf of the Board |
|
|
|
|
| Faisalabad |
|
TAHIR SALEEM CHAUDHRY |
|
| Dated:
9th March 2001 |
|
Chief Executive |
|
|
| NOTES: |
|
| 1.
The share transfer books of the company will remain closed from March 24th to |
|
| March
31st 2001. ( both days inclusive ) |
|
|
| 2.
A member entitled to attend and vote at this meeting is entitled to appoint a |
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| proxy
to attend and vote instead of him / her. A proxy must be a member. |
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|
| 3.
The instrument appointing a proxy must be received at the Registered Office |
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| not
later than 48 hours before the time appointed for meeting. |
|
|
| 4.
Shareholders are requested to promptly notify the Company of any change in |
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| their
address. |
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|
|
| DIRECTOR'S
REPORT TO THE MEMBERS |
|
|
| Dear
Members, |
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| At
the occasion of 14th Annual General Meeting of the company the directors are
pleased to |
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| present
as under the Annual report for the year ended 30th September 2000. |
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|
| General |
|
| Inspite
of the best possible efforts of the management the declining trend in the
compare/ |
|
| business
continued during the year under review. The problems of shortage of working
capital |
|
| continued
because the short term financing limits of the company could not be renewed
by the |
|
| banks. |
|
|
| The
proposal for the rescheduling and restructuring of long term loans remained
undecided by |
|
| M/S
Bankers Equity Limited. In the circumstances the company could not process
its own |
|
| fabric
and continued with the processing for out side parties, which resulted in to
further |
|
| decrease
in turnover. |
|
|
| The
stock of yarn purchased by the company in 1998-99 could not be utilized
because of the |
|
| lack
of demand in the market. The quality of the same deteriorated due to moisture
and was |
|
| disposed
of during the year, there by incurring a loss of Rs. 4.827 million. |
|
| Because
of the above factors the loss for the year after taxation comes to Rs. 27.316
million. |
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|
| FINANCIAL
RESULTS |
|
|
Rs. In Million |
|
| Sales |
|
8.866 |
|
| Cost of Sales |
|
14.974 |
|
| Gross
Profit/(Loss) |
|
(6.108) |
|
| OPERATING
EXPENSES |
|
|
|
| Administrative |
|
2.048 |
|
| Selling |
|
0.040 |
|
|
------------ |
|
|
2.088 |
|
|
------------ |
|
| Operating
profit/(loss) |
|
(8.196) |
|
| Other
Income |
|
0.044 |
|
|
|
|
| Trading
Income / (Loss) |
|
(4.828) |
|
| OTHER
CHARGES |
|
|
|
| Financial |
|
14.28 |
|
|
------------ |
|
| Net
profit / (loss) for the year before taxation |
|
(27.263) |
|
| Provision
for taxation |
|
0.053 |
|
|
------------ |
|
| Net
profit / (loss) for the year after taxation |
|
(27.316) |
|
|
| FUTURE
PROSPECTS |
|
| The
management is striving hard to bring the project out of woods, but because of
the cold |
|
| response
given by the concerned banks / Financial Institutions their has been no
visible |
|
| improvements.
We are planning to resolve the problems of working capital from other |
|
| available
sources, and hope that our proposal with the Bankers Equity Limited will also
be |
|
| finalized
in the near future. This will improve the overall results in the coming year. |
|
|
| LABOUR
MANAGEMENT RELATIONS. |
|
| As
before, the management labour relations remained cordial. |
|
|
| AUDITORS |
|
| The
auditors M/S M. Ather & Co. Chartered Accountants retired and being
eligible offer |
|
| themselves
for reappointment. |
|
|
| PATTERN
OF SHARE HOLDINGS |
|
| Pattern
of share holdings is attached. |
|
|
| Faisalabad |
|
On behalf of the Board, |
|
| Date:
February 24, 2000 |
|
Tahir Saleem Chaudhry |
|
|
Chief Executive |
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|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of SALEEM DENIM INDUSTRIES |
|
| LIMITED
as at September 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 |
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| 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 |
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| 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 |
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| 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 accounts have been kept by the company |
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| 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 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, investment made and the expenditure. Incurred |
|
| during
the year were in accordance with the object of the company; |
|
|
| (c)
in our opinion and to the best of our information and according to the
explanation |
|
| 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 accounting standards as applicable in Pakistan, and give |
|
| the
information required by the Companies Ordinance, 1984, in the manner so |
|
| required
and respectively give a true and fair view of the state of the company's |
|
| affairs
as at September 30, 2000 and of the loss, changes in equity and its cash |
|
| flows
for the year then ended; and |
|
|
| (d)
in our opinion no Zakat was deductible at source under the Zakat and Ushr |
|
| Ordinance,
1980 ( XVIII of 1980 ). |
|
|
| Without
qualifying our opinion, we draw attention to the fact that the company has |
|
| incurred
accumulated losses of Rs. 205,769,039/- and its current liabilities have |
|
| exceeded
current assets by Rs. 109,866,750/-. The management is making efforts to |
|
| arrange
sufficient funds for the company on long term basis in order to enhance
working |
|
| capital
to overcome financial problems. Validity of the" Going Concern"
basis used by |
|
| the
company in preparation of its financial statements is dependent on the
prospect of |
|
| operating
profitability in the future and the availability of adequate working capital. |
|
|
| Date:
February 24,2001 |
|
M. ATHAR & CO. |
|
| Place:
FAISALABAD. |
|
Chartered Accountants |
|
|
|
|
| BALANCE
SHEET AS AT SEPTEMBER 30, 2000 |
|
|
|
|
2000 |
1999 |
|
| SHARE
CAPITAL |
|
Note |
Rupees |
Rupees |
|
| Authorised |
|
| 5,000,000
ordinary shares of |
|
| Rs. 10/- each |
|
50,000,000 |
50,000,000 |
|
|
| Issued,
Subscribed and Paid up |
|
|
| 3,901,800
ordinary shares of |
|
| Rs. 10/-each |
|
39,018,000 |
39,018,000 |
|
| Accumulated
Loss |
|
(205,769,039) |
'(178,452,544) |
|
|
----------- |
----------- |
|
|
(166,751,039) |
(139,434,544) |
|
|
| SURPLUS
ON REVALUATION OF |
|
| FIXED
ASSETS |
|
88,454,939 |
88,454,939 |
|
| LONG
TERM LOANS |
|
3 |
47,307,293 |
54,917,170 |
|
| DEFERRED
LIABILITIES |
|
|
|
|
| Deferred
mark-up |
|
4 |
42,322,158 |
52,902,698 |
|
| Staff
retirement gratuity |
|
|
908,800 |
792,120 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
| Current
portion of |
|
|
|
|
| long
term liabilities |
|
5 |
43,485,773 |
25,295,356 |
|
| Short
term loan |
|
6 |
6,188,553 |
7,007,509 |
|
| Creditors,
accrued and |
|
|
|
|
| other
liabilities |
|
7 |
75,247,699 |
61,681,174 |
|
| Taxation |
|
8 |
978,713 |
1,389,608 |
|
|
|
----------- |
----------- |
|
|
|
125,900,738 |
95,373,647 |
|
| CONTINGENCIES
AND |
|
|
|
|
| COMMITMENTS |
|
9 |
-- |
-- |
|
|
----------- |
----------- |
|
|
138,142,889 |
153,006,030 |
|
|
========== |
========== |
|
|
| FIXED
CAPITAL |
|
| EXPENDITURE |
|
| Operating
Fixed Assets |
|
10 |
121,464,411 |
128,145,385 |
|
| SECURITY
DEPOSITS |
|
|
644,490 |
644,490 |
|
| CURRENT
ASSETS |
|
|
|
| Stores
and Spares |
|
|
4,703,354 |
4,762,924 |
|
| Stock-in-Trade |
|
11 |
9,036,649 |
15,070,704 |
|
| Trade
debts considered good |
|
|
137,500 |
196,113 |
|
| Advances,
Deposits and |
|
|
|
| prepayments |
|
12 |
1,977,227 |
3,896,098 |
|
| Cash
and Bank balances |
|
13 |
179,258 |
290,316 |
|
|
----------- |
----------- |
|
|
16,033,988 |
24,216,155 |
|
|
----------- |
----------- |
|
|
138,142,889 |
153,006,030 |
|
|
========== |
========== |
|
| The
annexed notes from 1 to 26 form an integral part of these accounts |
|
|
| Place:
Faisalabad. |
|
| Dated:
Feb 24,2001 |
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED SEPTEMBER 30,2000 |
|
|
|
|
2000 |
1999 |
|
|
Note |
Rupees |
Rupees |
|
| SALES |
|
14 |
8,865,618 |
11,255,995 |
|
| COST
OF SALES |
|
15 |
14,974,453 |
20,322,701 |
|
| GROSS
PROFIT/(LOSS) |
|
|
(6.108,835) |
(9,066,706) |
|
|
| OPERATING
EXPENSES |
|
| Administrative |
|
2,047,673 |
2,130,273 |
|
| Selling
and Distribution |
|
40,331 |
41,726 |
|
|
----------- |
----------- |
|
|
2,088,004 |
2,171,999 |
|
|
----------- |
----------- |
|
| OPERATING
PROFIT/(LOSS) |
|
(8,196,839) |
(11,238,705) |
|
| OTHER
INCOME |
|
17 |
44,705 |
2,122 |
|
|
|
|
----------- |
----------- |
|
|
|
(8,152,134) |
(11,236,583) |
|
| TRADING
INCOME/(LOSS) |
|
18 |
(4,827,833) |
-- |
|
| OTHER
CHARGES |
|
| Financial |
|
19 |
14,283,168 |
14,319,576 |
|
|
|
----------- |
----------- |
|
| NET
PROFIT/(LOSS) FOR THE YEAR BEFORE TAXATION |
|
(27,263,135) |
(25,556,159) |
|
|
| TAXATION |
|
53,360 |
56,280 |
|
|
----------- |
----------- |
|
| NET
PROFIT/(LOSS) FOR THE YEAR AFTER TAXATION |
|
(27,316,495) |
(25,612,439) |
|
|
| PRIOR
YEAR ADJUSTMENT |
|
-- |
3,310,373 |
|
| LOSS
BROUGHT FORWARD |
|
(178,452,544) |
156,150,478) |
|
|
----------- |
----------- |
|
| ACCUMULATED
LOSS CARRIED TO BALANCE SHEET |
|
(205,769,039) |
(178,452,544) |
|
|
========== |
========== |
|
| LOSS
PER SHARE |
|
20 |
(7.00) |
(6.56) |
|
|
| The
annexed notes from 1 to 26 form an integral part of these accounts |
|
|
| Place:
Faisalabad. |
|
| Dated:
Feb 24,2001 |
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
|
| STATEMENT
OF CHANGES IN EQUITY |
|
| for
the year ended September 30,2000 |
|
|
|
Share |
Capital |
Revenue |
Total |
|
|
Capital |
Reserves |
Reserves |
|
|
|
|
Surplus on |
Accumulated |
|
|
|
revaluation |
Profit/(Loss) |
|
|
|
of Fixed assets |
|
|
|
Rupees |
Rupees |
Rupees |
Rupees |
|
| Balance
as at October 01, 1998 |
|
39,018,000 |
88,454,939 |
(156,150,478) |
(28,677,539) |
|
|
| Loss
for the year ended |
|
-- |
-- |
(22,302,066) |
(22,302,066) |
|
| September
30,1999 |
|
|
|
|
----------- |
----------- |
----------- |
----------- |
|
| Balance
as at October 01, 1999 |
|
39,018,000 |
88,454,939 |
(178,452,544)
(50,979,605) |
|
|
| Loss
for the year ended |
|
| September
30, 2000 |
|
-- |
-- |
(27,316,495) |
(27,316,495) |
|
|
----------- |
----------- |
----------- |
----------- |
|
| Balance as at September 30,
2000 |
39,018,000 |
88,454,939 |
(205,769,039) |
(78,296,100) |
|
|
========== |
========== |
========== |
========== |
|
|
|
|
| The
annexed notes from 1 to 26 form an integral part of these accounts. |
|
|
| Place:
Faisalabad. |
|
| Dated:
Feb 24,2001 |
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED SEPTEMBER 30, 2000 |
|
|
|
2000 |
1999 |
|
|
Rupees |
Rupees |
|
| a)
CASH FLOWS FROM OPERATING ACTIVITIES |
|
| Loss
for the year before taxation |
|
(27,263,135) |
(25,556,159) |
|
| Depreciation |
|
6,657,905 |
7,089,646 |
|
|
| Provision
for gratuity |
|
116,680 |
185,286 |
|
| Financial
charges |
|
14,283,168 |
14,319,576 |
|
| Profit
on sale of vehicle |
|
(26,931) |
-- |
|
|
----------- |
----------- |
|
| Operating
Loss before working |
|
| capital
changes |
|
(6,232,313) |
(3,961,651) |
|
|
| Changes
in working capital |
|
| (Increase)/decrease
in current assets |
|
|
| Stores
and spares |
|
59,570 |
(3,514,690) |
|
| Stock
in trade |
|
6,034,055 |
285,227 |
|
| Trade Debts |
|
58,613 |
(74,836) |
|
| Advances,
Deposits and Prepayments |
|
1,332,489 |
1,588,275 |
|
| Increase/(decrease)
in current liabilities |
|
| Creditors, accrued and
other liabilities |
|
20,631 |
5,528,624 |
|
|
----------- |
----------- |
|
|
7,505,358 |
3,812,600 |
|
|
| Cash
generated from/(used in) operations |
|
1,273,045 |
(149,051 ) |
|
|
| Financial
charges paid |
|
(150,892) |
(2,610,105) |
|
| Taxes paid |
|
(464,255) |
(720,000) |
|
| Prior
year adjustments |
|
-- |
3,310,373 |
|
|
----------- |
----------- |
|
| Net
cash generated from/ |
|
| (used
in) operating activities |
|
657,898 |
(168,783) |
|
|
========== |
========== |
|
|
| b)
CASH FLOWS FROM INVESTING ACTIVITIES |
|
| Sale
of fixed Assets |
|
50,000 |
-- |
|
|
----------- |
----------- |
|
| Net
cash generated from/(used in) |
|
|
|
| investing
activities |
|
50,000 |
-- |
|
|
----------- |
----------- |
|
| c)
CASH FLOWS FROM FINANCING ACTIVITIES |
|
| Deferred
Markup |
|
-- |
(199,174) |
|
| Short
term loans |
|
(818,956) |
(124,041 ) |
|
|
----------- |
----------- |
|
| Net
cash generated from/(used in) |
|
| financing
activities |
|
(818,956) |
(323,215) |
|
|
|
|
| Net
decrease in cash and |
|
|
|
| bank
balance (a+b+c) |
|
(111,058) |
(491,998) |
|
|
|
|
| Cash
and bank balances at the |
|
|
|
| beginning
of the year |
|
290,316 |
782,314 |
|
|
----------- |
----------- |
|
| Cash
and bank balances at the |
|
|
|
| end
of the year |
|
179,258 |
290,316 |
|
|
========== |
========== |
|
|
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
|
|
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED SEPTEMBER 30, 2000 |
|
|
| 1.
THE COMPANY AND ITS OPERATIONS: |
|
| Saleem
Denim Industries Limited is a Public Company limited by shares |
|
| incorporated
in Pakistan under Companies Ordinance 1984. The main |
|
| business
of the company is the manufacture of Grey and Denim Fabric. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES: |
|
| The
following accounting policies have been applied consistently in |
|
| dealing
with items which are considered material to the Company's |
|
| accounts. |
|
|
| 2.1
Basis of Accounting |
|
| The
accounts are drawn up under historical cost convention. |
|
|
| 2.2
Staff Retirement Gratuity |
|
| The
company operates an unfunded statutory gratuity scheme and |
|
| provision
is made annually to cover obligations under the scheme. |
|
|
| 2.3 Taxation |
|
|
| Current |
|
| Provision
for current taxation is based on taxable income at current |
|
| tax
rates after taking into account tax rebates and tax credits |
|
| available,
if any. |
|
|
| Deferred |
|
| The
company accounts for deferred taxation on all material timing |
|
| differences
using the liability method. However, deferred tax to |
|
| certain
extent is not provided if it can be established with |
|
| reasonable
probability that these timing differences will not reverse |
|
| in
the foreseeable future. |
|
|
| 2.4
Fixed Assets |
|
| These
are stated at cost less accumulated depreciation except |
|
| Free-hold
Land, Building and Plant & Machinery which are shown |
|
| at
revalued amount and Capital work in progress which are stated |
|
| at cost. |
|
|
