| Elite Textile Mills Limited |
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|
|
|
|
|
|
| Annual
Report 1999 |
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|
IN THE NAME OF ALLAH, THE BENEFICENT, THE MERCIFUL |
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|
|
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| CONTENTS |
|
|
| Board
of Directors |
|
| Notice
of Meeting |
|
|
| Directors'
Report to the Shareholders |
|
| Auditors'
Report to the Members |
|
| Balance Sheet |
|
|
| Profit
and Loss Accounts |
|
| Statement
of Changes in Financial Position |
|
| Notes
to the Accounts |
|
| Shareholding
Statistics |
|
|
|
| BOARD
OF DIRECTORS |
|
| Ahsan
M. Saleem |
|
| Amjad
Mahmood |
|
| Khalid Bashir |
|
| Shams Rafi |
|
| Shaukat Shafi |
|
| Tariq
Shafi (Chief Executive) |
|
| Zahid Bashir |
|
|
| Auditors |
|
| M.
Yousuf Adil Saleem & Co. |
|
| Chartered
Accountants |
|
|
| Bankers |
|
| Muslims
Commercial Bank Ltd. |
|
|
| National
Bank of Pakistan |
|
|
|
| Legal Advisers |
|
| A.
K. Brohi & Co. |
|
| Ghani
Law Associates |
|
|
| Registered
Office |
|
| A-40,
S.I.T.E., Manghopir Road, Karachi. |
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|
| Mills |
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| A-40,
S.I.T.E., Manghopir Road, Karachi. |
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|
| Head Office |
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| 3rd
Floor, Finlay House, |
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| I.
I. Chundrigar Road, Karachi. |
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|
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| NOTICE
OF ANNUAL GENERAL MEETING |
|
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| Notice
is hereby given that the 48th Annual General Meeting of ELITE TEXTILE MILLS
LIMITED |
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| will
be held on Friday the March 31,2000 at 4.30 p.m. at the Registered Office
A/40, S.I.T.E. |
|
| Karachi,
to transact the following Ordinary Business. |
|
|
| Agenda: |
|
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| 1.
To confirm the Minutes of the 47th Annual General Meeting held on March 31,
1999. |
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|
|
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| 2.
To receive and adopt the Directors' and Auditors' Report & Accounts for
the year |
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| ended
September 30, 1999. |
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|
|
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| 3.
To appoint Auditors for the year ended 1999-2000 and fix their remuneration. |
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| The
present auditors M/s. Yousuf Adil Saleem & Co., Chartered Accountants,
being |
|
| eligible,
offer themselves for reappointment. |
|
|
| 4.
To consider any other business which may be placed before the Meeting with
the |
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| permission
of the Chair. |
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|
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| Book Closure |
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| The
Share Transfer Books of the Company will remain closed from March 25, 2000 to
March |
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| 31,
2000 (both days inclusive). |
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| Participation
in the Annual General Meeting: |
|
|
| 1.
A member eligible to attend and vote at this Meeting may appoint another as |
|
| his/her
proxy to attend and vote instead of him/her. Proxies in order to be effective |
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| must
be received by the Company at the Registered Office not later than 48 hours |
|
| before
the time for holding the Meeting. |
|
|
| 2.
Share holders are requested to immediately notify the changes in address if
any. |
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|
| Registered
Office |
|
On behalf of the Board |
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| A/40,
S.I.T.E., Manghopir Road, |
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|
| Karachi. |
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|
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| March 09, 2000 |
|
Company Secretary |
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|
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| DIRECTOR'S
REPORT TO THE SHAREHOLDERS |
|
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| The
Director's of your Company are pleased to present the 48th Annual Report and |
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| audited
financial statement of the Company for the year ended September 30, 1999. |
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| Your
Company's trading for the year ended September 30, 1999 resulted in a pre-tax
loss |
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| of
Rs. 16,964,077 after meeting all operational, administrative, financial and
other |
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| expenses. |
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|
| Break
up of it can be read under profit & loss account 1999. |
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|
|
1999 |
|
|
|
Rupees |
|
|
| Loss
before taxation |
|
(16,964,077) |
|
| Provision
for taxation |
|
(127,500) |
|
|
|
|
------------------ |
|
|
|
|
(17,091,577) |
|
| Accumulated
loss brought forward |
|
(129,731,627) |
|
|
|
|
------------------ |
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| Accumulated
loss carried forward |
|
(146,823,204) |
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|
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|
========== |
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| The
Company has ceased all production activities since September 1997 and has |
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| disposed
of all plant and machinery and portion of land and building and intends to |
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| dispose
off remaining land with building thereon, Considering the above facts the |
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| Auditors
observe that the Company is no more a going concern and the same they |
|
| mentioned
in their report. |
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|
| During
the year under review some idle assets has disposed off and also some portion
of |
|
| investment
were sold resulting in net gain of Rs. 3,454,186. |
|
|
| The
pattern of shareholding is provided on page 23. |
|
|
| The
present auditors M. Yousuf Adil Saleem & Co. retired and being eligible,
offer |
|
| themselves
for reappointment. |
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|
|
| Date:
March 09, 2000 |
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|
TARIQ SHAFI |
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| Karachi. |
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|
Chief Executive |
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|
|
| AUDITORS'
REPORT TO THE MEMBERS |
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| We
have audited the annexed balance sheet of ELITE TEXTILE MILLS LIMITED as at |
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| September
30, 1999 and the related profit and loss account and statement of changes in |
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| financial
position (cash flow statement), together with the notes forming part thereof,
for |
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| the
year ended on that date 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)
The Company has ceased all production activities since September 1997 and |
|
| has
disposed of all plant and machinery and portion of land and building and |
|
| intend
to dispose off remaining land with buildings thereon. Therefore, the |
|
| company
is no more a going concern. Consequently the adjustments required |
|
| to
record assets at realizable value and classification of its liabilities has
not |
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| been made. |
|
|
|
|
| (b)
in our opinion, proper books of accounts have been kept by the Company as |
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| required
by the Companies Ordinance, 1984; |
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|
|
| (c)
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 |
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| Company's
business; and |
|
|
| (iii)
the business conducted, investments made and the expenditure incurred |
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| during
the year were in accordance with the objects of the company; |
|
|
| (d)
in our opinion and to the best of our information and according to the |
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| explanations
given to us, except for the effect of any adjustment had the assets |
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| been
taken at realize value and classification of liabilities in view of the
matter |
|
| referred
to in para (a) above, the balance sheet and profit and loss account and |
|
| the
statement of changes in financial position (cash flow statement), together |
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| with
the notes forming part thereof, give the information required by the |
|
| Companies
Ordinance, 1984 in the manner so required and respectively give a |
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| true
and fair view of the state of the Company's affairs as at September 30, |
|
| 1999
and of the loss and the changes in financial position for the year then |
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| ended; and |
|
|
| (e)
in our opinion, no zakat was deductible at source under the Zakat and Ushr |
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| Ordinance,
1980. |
|
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| Date:
March 08, 2000 |
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|
M. Yousuf Adil Saleem & Co. |
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| Karachi. |
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|
Chartered Accountants |
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|
|
| BALANCE
SHEET AS AT SEPTEMBER 30, 1999 |
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|
1999 |
1998 |
|
|
|
|
Note |
Rupees |
Rupees |
|
|
|
|
| SHARE
CAPITAL |
|
|
|
|
|
|
| Authorised |
|
|
|
| 2,000,000
Ordinary shares |
|
|
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| of Rs. 10/- each |
|
20,000,000 |
20,000,000 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| Issued,
subscribed and paid up |
|
3 |
19,320,000 |
19,320,000 |
|
| Accumulated
loss |
|
|
|
(146,823,204) |
(129,731,627) |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
|
(127,503,204) |
(110,411,627) |
|
| SURPLUS
ON REVALUATION |
|
|
| OF
FIXED ASSETS |
|
4 |
49,800,000 |
49,800,000 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Short
term bank borrowings |
|
5 |
24,778,819 |
42,539,380 |
|
| Short
term loans |
|
6 |
87,725,160 |
92,093,745 |
|
| Creditors,
accrued and other |
|
|
|
| liabilities |
|
7 |
30,818,485 |
41,319,493 |
|
| Taxation |
|
|
940,732 |
813,232 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
144,263,196 |
176,765,850 |
|
| CONTINGENCIES |
|
|
8 |
-- |
-- |
|
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|
|
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|
------------------ |
------------------ |
|
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|
66,559,992 |
116,154,223 |
|
|
|
|
========== |
========== |
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|
| OPERATING
ASSETS |
|
9 |
409,036 |
511,295 |
|
| IDLE ASSETS |
|
|
10 |
55,116,209 |
57,693,101 |
|
| LONG
TERM INVESTMENTS |
|
11 |
-- |
6,200,000 |
|
| LONG
TERM DEPOSITS |
|
|
968,900 |
968,900 |
|
|
|
|
|
| CURRENT
ASSETS |
|
|
| Trade debts |
|
12 |
415,564 |
6,768,672 |
|
| Advance
income tax |
|
|
2,279,618 |
1,930,999 |
|
| Deposits
and prepayments |
|
13 |
147,282 |
11,630,625 |
|
| Other
receivables |
|
14 |
6,968,491 |
29,306,242 |
|
| Cash
and bank balances |
|
15 |
254,892 |
1,144,389 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
10,065,847 |
50,780,927 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
66,559,992 |
116,154,223 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes from 1 to 30 form an integral part of these accounts. |
|
|
|
|
|
|
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
|
|
|
| PROFIT
& LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED SEPTEMBER 30, 1999 |
|
|
|
|
1999 |
1998 |
|
|
Note |
Rupees |
Rupees |
|
|
|
|
|
| Sales |
|
|
16 |
-- |
19,521,649 |
|
| Cost
of goods sold |
|
|
17 |
-- |
18,009,991 |
|
|
|
|
------------------ |
------------------ |
|
| Gross profit |
|
|
|
-- |
15,111,658 |
|
|
|
|
|
|
|
| Trading profit |
|
18 |
205,602 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
205,602 |
1,511,658 |
|
| Operating
expenses |
|
|
|
|
| Administration |
|
19 |
663,147 |
2,403,089 |
|
| Selling |
|
20 |
-- |
1,197,810 |
|
|
|
|
------------------ |
------------------ |
|
|
|
(663,147) |
(3,600,899) |
|
|
|
------------------ |
------------------ |
|
| Operating loss |
|
(457,545) |
(2,089,241) |
|
| Other income |
|
|
-- |
29,356 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(457,545) |
(2,059,885) |
|
| Financial
charges |
|
21 |
(19,960,718) |
(25,671,334) |
|
|
|
|
------------------ |
------------------ |
|
| Loss
before taxation and gain on disposal |
|
|
| of
assets rind investments |
|
(20,418,263) |
(27,731,219) |
|
|
|
|
------------------ |
------------------ |
|
| Gain
on disposal of idle assets |
|
|
22 |
1,694,186 |
69,716,460 |
|
| Gain on sale of investment |
|
|
23 |
1,760,000 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
3,454,186 |
69,716,460 |
|
|
|
------------------ |
------------------ |
|
| (Loss)/Profit
before taxation |
|
(16,964,077) |
41,985,241 |
|
|
|
|
|
|
| Provision
for taxation |
|
|
|
| Minimum
tax/presumptive tax |
|
|
| Current |
|
127,500 |
187,443 |
|
| Prior year's |
|
-- |
(32,619) |
|
|
|
------------------ |
------------------ |
|
|
|
(127,500) |
(154,824) |
|
|
|
------------------ |
------------------ |
|
| (Loss)
/ Profit after taxation |
|
|
(17,091,577) |
41,830,417 |
|
| Accumulated
Loss brought forward |
|
(129,731,627) |
(171,562,044) |
|
|
|
------------------ |
------------------ |
|
| Accumulated
loss carried forward |
|
(146,823,204) |
(129,731,627) |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes from 1 to 30 form an integral part of these accounts. |
|
|
|
CHIEF EXECUTIVE |
|
|
DIRECTOR |
|
|
|
|
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED SEPTEMBER 30, 1999 |
|
|
|
|
1999 |
1998 |
|
|
|
|
|
Rupees |
Rupees |
|
|
|
|
| A.
CASH FROM OPERATING ACTIVITIES |
|
|
| (Loss)
/ Profit before taxation |
|
|
(16,964,077) |
41,985,241 |
|
| Adjustment
for: |
|
|
|
|
|
| Depreciation |
|
|
|
102,259 |
127,824 |
|
| Gain
on disposal of assets |
|
|
(1,694,186) |
(70,443,238) |
|
| Gain
on sale of investments |
|
|
(1,760,000) |
-- |
|
|
| Provision
for gratuity |
|
|
|
-- |
82,376 |
|
|
| Payment
of gratuity |
|
|
|
-- |
(860,113) |
|
| Financial
charges |
|
|
19,960,718 |
25,671,334 |
|
|
|
|
------------------ |
------------------ |
|
| Operating
loss before working capital charges |
|
(335,286) |
(3,436,576) |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
|
| Changes
in working capital |
|
|
|
| (Increase)/decrease
in current assets |
|
|
| Stores,
spares and loose tools |
|
|
-- |
6,949,714 |
|
|
| Stock in trade |
|
|
|
-- |
985,800 |
|
|
| Trade debts |
|
|
|
6,353,108 |
341,564 |
|
|
| Loans
and advances |
|
|
-- |
240,184 |
|
|
| Deposits
and prepayments |
|
|
11,483,343 |
(170,712) |
|
|
| Other
receivables |
|
22,337,751 |
(5,280,246) |
|
|
| Increase/(decrease)
in current liabilities |
|
|
|
|
|
| Creditors,
accrued and other liabilities |
|
|
(7,692,646) |
(54,218,753) |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
32,481,556 |
(51,152,449) |
|
|
|
|
------------------ |
------------------ |
|
| Cash
generated / (used in) from operations |
|
32,126,270 |
(54,589,025) |
|
| Financial
charges paid |
|
(22,769080) |
(22,925,863) |
|
| Tax paid |
|
(348,619) |
(923,018) |
|
|
|
------------------ |
------------------ |
|
| NET
CASH FROM / (USED IN) OPERATING ACTIVITIES |
|
9,008,571 |
(78,437,906) |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
| B.
CASH FROM INVESTING ACTIVITIES |
|
|
| Proceeds
from disposal of assets |
|
4,271,078 |
83,846,250 |
|
| Proceeds
from sale of long term investments |
|
7,960,000 |
-- |
|
|
|
------------------ |
------------------ |
|
| NET
CASH FROM INVESTING ACTIVITIES |
|
12,231,078 |
83,846,250 |
|
|
|
|
|
|
========== |
========== |
|
|
| C.
CASH FROM FINANCING ACTIVITIES |
|
|
| Repayment
of long term loan |
|
-- |
(1,796,894) |
|
| Decrease
in short term borrowings |
|
(17,760,561) |
(15,402,779) |
|
| (Decrease)
/ Increase in short term loans |
|
(4,368,585) |
11,676,377 |
|
|
|
|
|
------------------ |
------------------ |
|
| NET
CASH USED IN FINANCING ACTIVITIES |
|
(22,129,146) |
(5,523,296) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
| Net
decrease in cash and bank balances (A+B+C) |
|
(889,497) |
(114,952) |
|
| Cash
and bank balances at the |
|
|
|
| beginning
of the year |
|
|
1,144,389 |
1,259,341 |
|
| cash
and bank balances |
|
|
------------------ |
------------------ |
|
| at
the end of the year |
|
|
254,892 |
1,144,389 |
|
|
|
|
========== |
========== |
|
|
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED SEPTEMBER 30, 1999 |
|
|
| 1.
STATUS AND ACTIVITIES |
|
|
| 1.1
The Company is limited by shares incorporated in Pakistan on August 21, 1951 |
|
| and
quoted on the Karachi and Islamabad stock exchanges. The principal |
|
| business
of the Company was manufacture and sale of yarn. The Mills is |
|
| located
at Sindh Industrial Trading Estate, Karachi. |
|
|
| 1.2
A special resolution has been passed in the general meeting of the members |
|
| on
July 10, 1997 authorizing the Board of Directors to dispose of the whole of |
|
| the
undertaking comprising of land, building, plant & machinery and other |
|
| fixed
and current assets of the Company. |
|
|
|
|
| The
Company has ceased all production activities since September 01, 1997 |
|
| and
has disposed of major portion of plant & machinery and part of land and |
|
| building
and relieved the workers of the Company. The company intend to |
|
| dispose
off remaining land with buildings thereon and other assets. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
|
| 2.1
Accounting convention |
|
|
|
| These
accounts have been prepared under 'historical cost convention', except |
|
| leasehold
land that has been included at revaluation. |
|
|
| 2.2 Taxation |
|
|
|
| Provision
for taxation is based on taxable income at current-tax rates after |
|
| taking
into account tax rebates and tax credits available, if any. |
|
|
|
|
| 2.3
Operating fixed assets |
|
|
|
| Operating
assets are stated at cost less accumulated depreciation. |
|
| Depreciation
is charged to income applying the reducing balance method at |
|
| the
rates specified in fixed assets note. Depreciation on additions for the year |
|
| is
charged on the basis of whole year while no depreciation is charged on |
|
| deletions
during the year. Maintenance and normal repairs are charged to |
|
| income
as and when incurred. Major renewals and improvements are |
|
| capitalized.
Gains and losses on disposal of fixed assets are included in current |
|
| income. |
|
|
| 2.4 Idle assets |
|
|
|
| These
are stated at lower of book value and net realizable value. |
|
|
| 2.5
Investments |
|
|
|
| Long
term investment in shares of joint stock companies are stated at cost. |
|
| Permanent
diminution in value is charged to current income. |
|
|
| 2.6
Trade debtors |
|
|
|
| Known
bad debts are written off and provision is made for debts considered |
|
| doubtful. |
|
|
|
|
| 2.7
Rates of exchange |
|
|
|
| Assets
and liabilities in foreign currencies are converted into Rupees at the |
|
| rates
of exchange ruling on the balance sheet date. Exchange differences |
|
| are
included in current income. |
|
|
|
|
| 2.8
Revenue recognition |
|
|
|
| Sales
are recorded on despatch of goods. |
|
|
|
| 3.
Issued, subscribed and paid up capital |
|
|
| 1998 |
1999 |
|
1999 |
1998 |
|
| No. of Shares |
|
Rupees |
Rupees |
|
|
|
|
|
Ordinary shares of Rs.
10/- |
|
| 920,000 |
920,000 |
each fully paid in cash |
|
9,200,000 |
9,200,000 |
|
|
|
|
|
|
Ordinary shares of Rs.
10/- |
|
|
|
issued as fully paid |
|
|
| 1,012,000 |
1,012,000 |
bonus shares |
|
10,120,000 |
10,120,000 |
|
| ------------------ |
------------------ |
|
|
------------------ |
------------------ |
|
| 1,932,000 |
1,932,000 |
|
|
19,320,000 |
19,320,000 |
|
| ========== |
========== |
|
|
|
========== |
========== |
|
|
|
|
| 4.
SURPLUS ON REVALUATION OF FIXED ASSETS |
|
| Opening
balance |
|
49,800,000 |
138,500,000 |
|
| Realizable
gain on disposal transferred |
|
|
|
| to
profit and loss account |
|
-- |
(88,700,000) |
|
|
|
------------------ |
------------------ |
|
|
|
49,800,000 |
49,800,000 |
|
|
|
|
========== |
========== |
|
|
|
|
| Revaluation
of land has been carried out as on September 30, 1995 by M/s. Iqbal A. |
|
| Nanjee
& Co. Surveyors and Valuation Consultants on the basis of replacement |
|
| value.
Revaluation surplus has been credited to surplus on revaluation of fixed
assets |
|
| accounts. |
|
|
|
|
|
|
| 5.
SHORT TERM BANK BORROWINGS |
|
Limit Rs. |
|
| Secured
- under markup arrangements |
|
in million |
|
|
|
|
| Cash finance |
|
25 |
24,778,819 |
