| Dilon Limited |
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| Annual
Report 2001 |
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| CONTENTS |
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| Company
Information |
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| Notice
of Meeting |
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| Directors'
Report |
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| Auditors'
Report to the Members |
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| Balance Sheet |
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| Profit
& Loss Account |
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| Cash
Flow Statement |
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| Statement
of Changes in Equity |
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| Notes
to the Accounts |
|
| Pattern
of Shareholding |
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| COMPANY
INFORMATION |
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| DIRECTORS |
|
Ahmed Dawood |
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|
M. Hussain Dawood |
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|
Shahzada Dawood |
Chief Executive |
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|
Khawaja Amanullah |
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|
A. Aziz Moon |
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|
Haroon Mehanti |
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|
Yousuf A. Deshi |
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| SECRETARY
& G.M. (FINANCE) |
Yousuf A. Deshi |
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| AUDITORS |
|
Gangat & Company |
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|
(Chartered Accountants) |
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| BANKERS |
|
Habib Bank Limited |
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Bank AL Habib Limited |
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National Bank of Pakistan |
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| REGISTERED
OFFICE |
Dawood Centre |
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|
Karachi-75530 |
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| MILLS |
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Landhi Industrial Area |
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Karachi-75120 |
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| NOTICE
OF MEETING |
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| Notice
is hereby given that the 28'h Annual General Meeting of the Shareholders of
the Company will Insha Allah be |
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| held
on Thursday the 15th November, 2001 at 12:00 hours at the Company's
Registered Office at Dawood Centre, |
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| Moulvi
Tamizuddin Khan Road, Karachi, for the purpose of transacting the following
business after recitation from the |
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| Holy Quran. |
|
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| Ordinary
Business: |
|
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| 1.
To confirm the Minutes of the Annual General Meeting held on 12th December,
2000. |
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|
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| 2.
To receive, consider and adopt the Audited Accounts of the Company for the
year ended 30th June, 2001 |
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| together
with the Directors and Auditors Report thereon. |
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| 3.
To consider and approve payment of Final cash dividend at the rate of Rs. 2/-
per share (20%) in |
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| addition
to 50% Interim cash dividend already paid as recommended by the Board of
Directors. |
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|
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| 4.
To elect seven Directors, as fixed by the Board under section 178(1) of the
Companies Ordinance, 1984 |
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| for
three years in place of the following retiring Directors. |
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|
AHMED DAWOOD |
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M. HUSSAIN DAWOOD |
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SHAHZADA DAWOOD |
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|
KHAWAJA AMANULLAH |
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|
A. AZIZ MOON |
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|
HAROON MEHANTI |
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|
YOUSUF A. DESHI |
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| The
Board has decided to link the date of election of the Directors with the date
of annual general |
|
| meeting
in order to facilitate the shareholders and minimize expenses related
therewith. |
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| 5.
To appoint auditors for the year 2001-2002 and to fix their remuneration. The
present auditors, M/s. |
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| Gangat
& Company, Chartered Accountants, retire and being eligible, offer
themselves for re-appointment. |
|
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| 6.
To transact any other ordinary business with the permission of the Chairman. |
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| Special
Business:- |
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| 7.
To consider and if thought fit to pass with or without modification the
amendments in the following |
|
| Articles
of Association of the Company:- |
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|
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| Amendments
in Articles of Association of the Company:- |
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| Article
101 shall stand deleted and substituted as under:- |
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|
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| Article
101. The Board may elect one of them as Chairman and another as Vice Chairman
and deter- |
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| mine
the period for which they hold office. In the absence of the Chairman, the
Vice Chairman shall act |
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| as
Chairman at all meetings of Directors. If at any meeting the Chairman and
Vice Chairman not |
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| present
at the time appointed, the Directors shall elect one of their members to be
the Chairman of the |
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| meeting. |
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|
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| Article
85 shall stand deleted and substituted as under:- |
|
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| Article
85. The terms and remuneration of the Chairman, the Vice Chairman, and/or the
Chief Executive |
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| shall
from time to time be fixed by the Directors and may be by way of salary or by
any other modes within |
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| such
limits as may be prescribed by any law or regulation for the time being in
force. Unless otherwise |
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| determined
by the Company in General Meeting, every Director shall be paid out of the
funds of the |
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| Company
by way of remuneration for attending meetings of Directors and sub-committees
of Directors, |
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| for
every meeting of the Board or Sub-Committee attended by him as may be decided
by the Directors |
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| from
time to time. The Directors may also be paid travelling and hotel and other
expenses incurred in |
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| consequence
of their attendance at Board meetings and otherwise in the execution of their
duties as |
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| Directors,
as the Board of Directors may determine from time to time. |
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|
| THE
STATEMENT OF MATERIAL FACT (IN RESPECT OF THE PROPOSED SPECIAL BUSINESS)
UNDER |
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| SECTION
160(1)B OF THE COMPANIES ORDINANCE 1984. |
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| The
Board is of the opinion that existing circumstances warrant for making
provision to remuner- |
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| ate
the Directors as and when called upon to perform extra services. |
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By Order of the Board |
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|
(Yousuf A. Deshi) |
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| Karachi:
September 20, 2001. |
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Director/Secretary |
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| NOTES: |
|
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| 1.
The Share transfer books of the company will remain closed from 01.11.2001 to
15.11.2001 (both days |
|
| inclusive). |
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|
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| 2.
Transfers received at the Registered Office of the Company at Dawood Centre,
Moulvi |
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| Tamizuddin
Khan Road, Karachi at the close of the business on 31st October, 2001 will
qualify for the |
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| payment
of Dividend to the transferees. |
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|
|
|
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| 3.
A member entitled to attend and vote at the meeting is entitled to appoint a
proxy to attend, speak and |
|
| vote
for him/her. A proxy must be a member of the Company. |
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|
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| 4.
An instrument of proxy or power of attorney or other authority (if any) under
which it has signed or |
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| notarially
certified copy of such power or authority must be valid be deposited at the
Registered Office |
|
| of
the Company not less than 48 hours before the time of the meeting. |
|
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| 5.
Any person, who seeks to contest as Director of the Company must file with
the Company at the |
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| Registered
Office a notice of his intention not later than fourteen days before the
Annual General |
|
| Meeting
in accordance with Article 93 of the Articles of Association of the Company. |
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| 6.
Members are requested to communicate to the Company of any change in their
addresses. |
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| DIRECTORS'
REPORT |
|
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| Dear
Shareholders, |
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|
| Assalam-o-Alaikum. |
|
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| Your
directors have pleasure in presenting the 28th Annual Report along with the
Audited Accounts and Audi- |
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| tors
Report for the year ended 30th June, 2001. |
|
|
| During
the year the company by the Grace of Allah has achieved net sales of Rs.
186,614,084/- compared to |
|
| Rs.
121,456,071/- in the preceding year, which translates to an improvement of
Rs. 65.158 million (53.65%). |
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| This
increase can be attributed to better market condition, quality of product,
and increased sales efforts. |
|
|
| Input
costs increased over last year because of inflation and associated factors.
Production remained the |
|
| same
as last year. |
|
|
| The
company after charging expenses including administrative expenses and
providing for depreciation of |
|
| Rs.
3,385,693/- and Rs. 10,988,000/- for taxation earned the net profit after tax
Rs. 18,532,923/-. Taking into |
|
| consideration
the un-appropriated profit of Rs. 7,625,859/- brought forward from previous
year, and after deduc- |
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| tion
of Interim dividend for Rs. 11,797,500/- declared @ 50% (Rs. 5.00 per share),
a sum of Rs. 14,361,282/- |
|
| is
available for appropriation. |
|
|
| The
earning per share this year works out to Rs. 7.85 per share. |
|
|
| Available
profit for appropriation:- |
|
|
|
Rupees |
|
|
| Profit
before taxation |
|
|
29,520,923 |
|
| Provision
for taxation: |
|
|
|
|
| Current |
|
|
(10,988,000) |
|
|
|
------------------ |
|
| Profit
after taxation |
|
|
18,532,923 |
|
| Un-appropriated
profit brought forward |
|
7,625,859 |
|
|
|
------------------ |
|
| Available
for appropriation |
|
|
26,158,782 |
|
| Appropriation: |
|
| Less: |
|
| Interim
dividend already declared and paid |
|
| @
Rs. 5/= per share |
|
(11,797,500) |
|
|
|
------------------ |
|
| Available
for appropriation |
|
|
14,361,282 |
|
| Less: |
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| Proposed
final dividend @ Rs. 2/= per share |
|
| on
2,359,500 shares of Rs. 10/= each. |
|
(4,719,000) |
|
|
------------------ |
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| Balance
carried over to next year |
|
9,642,282 |
|
|
========== |
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|
| During
the year Mr. Shahzada Dawood was appointed Chief Executive of the Company
w.e.f. 15-03-2001 in |
|
| place
of Mr. M. Hussain Dawood. The Directors greatly appreciate the services and
the contribution made by |
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| Mr.
M. Hussain Dawood as the Chief Executive of the Company during his tenure. |
|
|
| The
three years term of the Board is expiring on 24-03-2002. The Board has
decided to link the date of election |
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| of
the Directors with that date of the Annual General Meeting and as a
consequence will retire at the next |
|
| meeting.
The new Board will be elected in accordance with provision of section 178 of
the Companies Ordi- |
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| nance,
1984. The number of Directors has been fixed at seven for election at the
Annual General Meeting. |
|
|
| The
retiring auditors M/s. Gangat & Company, Chartered Accountants retire and
have offered their services for |
|
| the
ensuing year. |
|
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| The
Board wishes to place on record its appreciation for the devotion shown by
all employees of the company. |
|
|
| The
Board of Directors meeting was scheduled for 18-09-2001 which was postponed
because of one of the |
|
| founding
Directors of the Company Seth Suleman Dawood had died on Tuesday 18th
September, 2001. The |
|
| Board
offered Fateha for the illustrious personality of Seth Suleman Dawood and
prayed Almighty Allah may |
|
| bless
him with paradise. The contribution made by Seth Suleman Dawood cannot be
adequately described in |
|
| words.
His loss is most grievously felt and we pray Almighty Allah will bless him
with everlasting peace. |
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|
|
|
On behalf of the Board |
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|
|
|
|
|
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|
(M. Hussain Dawood) |
|
| September 20, 2001 |
|
Chairman of the meeting |
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|
|
| Auditors'
Report to the Members |
|
|
| We
have audited the annexed balance sheet of DILON LIMITED as at June 30, 2001 and the related profit and |
|
| loss
account, cash flow statement and statement of changes in equity together with
the notes forming part |
|
| thereof,
for the year then ended and we state that we have obtained all the
information and explanations which, |
|
| to
the best of our knowledge and belief, were necessary for the purposes of our
audit. |
|
|
| It
is the responsibility of the company's management to establish and maintain a
system of internal control, |
|
| and
prepare and present the above said statements in conformity with the approved
accounting standards |
|
| and
the requirements of the Companies Ordinance, 1984. Our responsibility is to
express an opinion on |
|
| these
statements based on our audit. |
|
|
| We
conducted our audit in accordance with the auditing standards as applicable
in Pakistan. These standards |
|
| require
that we plan and perform the audit to obtain reasonable assurance about
whether the above said |
|
| statements
are free of any material misstatement. An audit includes examining, on a test
basis, evidence |
|
| supporting
the amounts and disclosures in the above said statements. An audit also
includes assessing the |
|
| accounting
policies and significant estimates made by the 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 as
required by the Companies |
|
| Ordinance, 1984; |
|
|
|
|
|
|
| (b)
in our opinion -- |
|
|
|
|
| (i)
the balance sheet and profit and loss account together with the notes thereon
have been |
|
| drawn
up in conformity with the Companies Ordinance, 1984, and are in agreement
with the |
|
| books
of account and are further in accordance with accounting policies
consistently applied. |
|
|
|
|
| (ii)
the expenditure incurred during the year was for the purpose of the Company's
business; and |
|
|
|
|
| (iii)
the business conducted, investments made and the expenditure incurred during
the year |
|
| were
in accordance with the objects of the Company; |
|
|
|
| (c)
in our opinion and to the best of our information and according to the
explanations given to us, the |
|
| balance
sheet, profit and loss account, cash flow statement and statement of changes
in equity |
|
| together
with. the notes forming part thereof conform with approved accounting
standards as applicable |
|
| in
Pakistan, and, give the information required by the Companies Ordinance,
1984, in the manner so |
|
| required
and respectively give a true and fair view of the state of the Company's
affairs as at June 30, |
|
| 2001
and of the profit, its cash flows and changes in equity for the year then
ended; and |
|
|
|
|
| (d)
in our opinion Zakat deductible at source under the Zakat and Ushr Ordinance,
1980 (XVIII of 1980), |
|
| was
deducted by the Company and deposited in the Central Zakat Fund established
under Section 7 |
|
| of
that Ordinance. |
|
|
|
|
|
|
GANGAT & COMPANY |
|
| Karachi:
September 20, 2001 |
|
Chartered Accountants |
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 2001 |
|
|
|
|
Note |
2001 |
2000 |
|
|
|
|
Rupees |
Rupees |
|
| CAPITAL
AND LIABILITIES |
|
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
|
| SHARE
CAPITAL |
|
|
| Authorised |
|
| 5,000,000
ordinary shares of Rs. 10 each |
|
50,000,000 |
50,000,000 |
|
|
|
|
========== |
========== |
|
|
|
|
| Issued,
subscribed and paid up capital |
3 |
23,595,000 |
23,595,000 |
|
|
| RESERVES
& SURPLUS |
|
|
|
| Revenue
reserves |
|
4 |
67,500,000 |
67,500,000 |
|
| Unappropriated
profit |
|
|
9,642,282 |
7,625,859 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
77,142,282 |
75,125,859 |
|
|
|
|
------------------ |
------------------ |
|
| CAPITAL
& RESERVES |
|
|
100,737,282 |
98,720,859 |
|
| DEFERRED
LIABILITIES |
|
5 |
13,802,149 |
13,335,194 |
|
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Creditors,
accrued and other liabilities |
6 |
34,298,638 |
26,767,652 |
|
| Provision
for taxation |
|
|
150,180,751 |
7,042,367 |
|
| Proposed
dividend |
|
|
4,719,000 |
16,516,500 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
54,035,713 |
50,326,519 |
|
| CONTINGENCIES
AND COMMITMENTS |
7 |
-- |
-- |
|
|
------------------ |
------------------ |
|
|
|
168,575,144 |
162,382,572 |
|
|
|
========== |
========== |
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
| Karachi:
September 20, 2001 |
|
|
|
| PROPERTY
AND ASSETS |
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating
assets |
|
8 |
29,143,833 |
31,408,933 |
|
|
|
|
|
| LONG
TERM INVESTMENTS |
|
9 |
1,001 |
1,001 |
|
| LONG
TERM DEPOSITS |
|
|
432,580 |
431,550 |
|
|
|
| CURRENT
ASSETS |
|
| Stores
and spares |
|
10 |
14,569,702 |
11,080,948 |
|
| Stock-in-trade |
|
11 |
10,357,920 |
13,742,028 |
|
| Trade
debts-unsecured, considered good |
|
16,388,209 |
10,192,433 |
|
| Loans,
advances, deposits, prepayments |
|
|
| and
other receivables |
|
12 |
11,140,107 |
8,472,685 |
|
| Cash
and bank balances |
|
13 |
86,541,792 |
87,052,994 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
138,997,730 |
130,541,088 |
|
|
|
|
------------------ |
------------------ |
|
|
168,575,144 |
162,382,572 |
|
|
|
========== |
========== |
|
|
|
SHAHZADA DAWOOD |
|
|
M. HUSSAIN DAWOOD |
|
|
Chief Executive |
|
|
Director |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
Note |
2001 |
2000 |
|
|
|
Rupees |
Rupees |
|
| PARTICULARS |
|
| Sales - net |
|
14 |
186,614,084 |
121,456,071 |
|
| Cost
of goods sold |
|
15 |
(156,851,778) |
(112,176,221) |
|
|
|
|
------------------ |
------------------ |
|
| Gross profit |
|
|
29,762,306 |
9,279,850 |
|
|
|
|
|
|
| Administrative
& selling expenses |
|
16 |
8,125,456 |
6,223,344 |
|
| Financial
expenses |
|
17 |
77,662 |
49,579 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(8,203,118) |
(6,272,923) |
|
|
------------------ |
------------------ |
|
| Operating profit |
|
|
21,559,188 |
3,006,927 |
|
| Other income |
|
18 |
10,052,612 |
11,340,108 |
|
| Capital gain |
|
19 |
-- |
11,626,660 |
|
| Profit
on sales of fixed assets |
|
8.3 |
97,593 |
20,927 |
|
|
------------------ |
------------------ |
|
| Profit
for the year |
|
|
31,709,393 |
25,994,622 |
|
| Other charges |
|
20 |
(2,188,470) |
(1,793,731) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
before taxation |
|
|
29,520,923 |
24,200,891 |
|
| Taxation |
|
21 |
(10,988,000) |
(3,310,000) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
|
18,532,923 |
20,890,891 |
|
| Unappropriated
profit brought forward |
|
7,625,859 |
3,251,468 |
|
|
|
|
------------------ |
------------------ |
|
| Available
for appropriation |
|
|
26,158,782 |
24,142,359 |
|
|
|
|
|
|
| APPROPRIATION |
|
| Interim
dividend (Rs. 5.00 per share) |
|
| (2000:
Rs. Nil per share) |
|
|
(11,797,500) |
-- |
|
|
|
|
|
| Proposed
dividend (Rs. 2.00 per share) |
|
|
| (2000:
Rs. 7.00 per share) |
|
|
(4,719,000) |
(16,516,500) |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
profit carried forward |
|
9,642,282 |
7,625,859 |
|
|
|
|
========== |
========== |
|
| Earning
per share |
|
23 |
7.85 |
8.85 |
|
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
|
SHAHZADA DAWOOD |
|
M. HUSSAIN DAWOOD |
|
|
Chief Executive |
|
Director |
|
|
| Karachi:
September 20, 2001 |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
2001 |
2000 |
|
|
|
Rupees |
Rupees |
|
|
|
|
| Cash
Flow from Operating Activities |
|
| Profit
before taxation |
|
29,520,923 |
24,200,891 |
|
|
|
|
|
| Adjustments
for: |
|
|
|
| Depreciation |
|
3,385,693 |
3,501,938 |
|
| Profit
on sales of fixed assets |
|
(97,593) |
(20,927) |
|
| Provision
for gratuity |
|
477,249 |
485,747 |
|
| Income
from investments |
|
(10,052,612) |
(11,340,108) |
|
| Capital gain |
|
-- |
(11,626,660) |
|
| Financial
charges |
|
77,662 |
49,579 |
|
|
------------------ |
------------------ |
|
| Operating
profit before working capital changes |
|
23,311,322 |
5,250,460 |
|
| Net
(increase)/decrease in working capital |
|
762,414 |
5,469,060 |
|
|
|
------------------ |
------------------ |
|
| Cash
generated from operations |
|
24,073,736 |
10,719,520 |
|
|
|
|
|
| Payment for: |
|
| Gratuity |
|
(10,294) |
-- |
|
| Tax |
|
(5,751,142) |
(4,236,937) |
|
| Financial
charges |
|
(77,662) |
(49,579) |
|
|
|
------------------ |
------------------ |
|
| Net
cash from operating activities (A) |
|
18,234,638 |
6,433,004 |
|
|
========== |
========== |
|
|
| Cash
Flow from Investment Activities |
|
| Acquisition
of fixed assets |
|
(13,38,000) |
(65,000) |
|
| Sales
of fixed assets |
|
315,000 |
70,000 |
|
| Sales
of investments |
|
-- |
50,671,660 |
|
| Income
from investments |
|
10,052,612 |
11,340,108 |
|
|
|
------------------ |
------------------ |
|
| Net
cash from investing activities (B) |
|
9,029,612 |
62,016,768 |
|
|
|
========== |
========== |
|
| Cash
Flow from Financing Activities |
|
| Dividend paid |
|
(27,775,452) |
(6,948,578) |
|
|
|
------------------ |
------------------ |
|
| Net
cash used in financing activities (c) |
|
(27,775,452) |
(6,948,578) |
|
|
|
========== |
========== |
|
|
|
|
|
| Net
(decrease)/increase in cash and cash |
|
|
|
| equivalents
(A+B+C) |
|
(5,11,202) |
61,501,194 |
|
| Cash
and cash equivalents at the beginning of the year |
87,052,994 |
25,551,800 |
|
|
|
------------------ |
------------------ |
|
| Cash
and cash equivalents at the end of the year |
|
86,541,792 |
87,052,994 |
|
|
========== |
========== |
|
|
|
| Movement
in Working Capital |
|
|
|
| (Increase)/Decrease
in Current Assets: |
|
| Long
term deposits |
|
|
(1,030) |
25,000 |
|
| Stores
and spares |
|
|
(3,488,754) |
(4,504,100) |
|
| Stock-in-trade |
|
|
3,384,108 |
(2,351,470) |
|
| Trade debts |
|
|
(6,195,776) |
9,366,015 |
|
| Loans,
advances, deposits, prepayments and |
|
|
|
| other
receivables |
|
|
|
|
| (excluding
advance payment of income tax) |
|
71,428 |
2,300,749 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(6,230,024) |
4,836,194 |
|
|
|
|
| Increase/(Decrease)
in Current Liabilities: |
|
| Creditors,
accrued and other liabilities |
|
| (excluding
dividend) |
|
|
6,992,438 |
632,866 |
