| Indus Polyester Company Limited |
|
|
|
|
|
|
|
|
| Annual
Report 1999 |
|
|
|
| CONTENTS |
|
|
| Company
Information |
|
| Notice
of Meeting |
|
| Directors' Report |
|
|
| Pattern
of Holding of the Shares |
|
| Auditors' Report |
|
|
| Balance Sheet |
|
|
| Profit
& Loss Account |
|
| Cash
Flow Statement |
|
| Notes
to the Accounts |
|
|
|
| COMPANY
INFORMATION |
|
|
| CHAIRMAN: |
|
| Mr.
Shaikh Mohammed Yousuf |
|
|
| CHIEF
EXECUTIVE: |
|
| Mr.
Naeem Akhtar Yousuf |
|
|
| DIRECTORS: |
|
| Mr.
Tariq Yousuf |
|
| Mr.
Atif Anis Barry |
|
| Mrs.
Zuhra Yousuf |
|
| Mrs.
Kausar Naeem |
|
| Mrs.
Nabila Tariq |
|
|
| AUDITORS: |
|
| M/s.
Hyder Bhimji & Company. |
|
| Chartered
Accountants |
|
|
| BANKERS: |
|
| Muslim
Commercial Bank Ltd. |
|
| Metropolitan
Bank Limited. |
|
| Bank
Al-Habib Limited. |
|
| National
Bank of Pakistan. |
|
|
| REGISTERED
OFFICE: |
|
| D
194, S.I.T.E, Karachi. |
|
| Phone: 6653371 |
|
|
| FACTORY: |
|
| 157-161
A, Phase V, |
|
| Hattar
Industrial Area, |
|
| District Haripur. |
|
| Phone:
0995-617038 |
|
|
|
| NOTICE
OF THE MEETING |
|
|
| Notice
is hereby given that the Seventh Annual General Meeting of Share Holders of
Indus Polyester |
|
| Company
Limited will be held on Tuesday 14th December, 1999 at 12.00 noon at
Registered .Office |
|
| D-194,
S.I.T.E., Karachi to consider the following Business. |
|
|
| 1.
To confirm minutes of Sixth Annual General Meeting. |
|
|
|
|
| 2.
To receive and approve audited Statement of Accounts & Balance Sheet of
the company for |
|
| the
year ended 30.06.1999 together with reports of Directors and Auditors
thereon. |
|
|
| 3.
To appoint Auditors of the Company and fix their remuneration for the year
ending 30th June |
|
| 2000 M/s. Hyder Bhimji & Co. who retire
offer themselves for re-appointment. |
|
|
| 4.
To transact any other business with the permission of Chair. |
|
|
|
|
By order of the Board |
|
|
|
|
|
|
|
|
|
MOHAMMAD HUSSAIN |
|
| Karachi,
Dated: 22nd November 1999. |
|
Company Secretary |
|
|
| NOTE |
|
|
| 1.
Share Transfer books of the Company will be closed from 7th December to 16th
December |
|
| 1999
both days inclusive. No transfers will be accepted for registration in the
names of the |
|
| transferees
during this period. |
|
|
| 2.
A member entitled to attend and vote at the Annual General Meeting is
entitled to appoint a |
|
| Proxy
to attend instead of him and such proxy will have the right to attend instead
of him/her, |
|
| speak
and vote in place of the member. A proxy must be a member of the company.
Forms of |
|
| proxy
in order to be valid,. must be deposited at the Company's Registered office
D-194, |
|
| S.I.T.E,
Karachi- 75700, not less than 48 hours before the time appointed for the
meeting. |
|
|
|
| DIRECTORS'
REPORT TO THE MEMBERS |
|
|
| We
are pleased to submit to you the 7th Annual Report along with the Audited
Accounts of the Company |
|
| for
the year ended 30th June, 1999. |
|
|
| REVIEW |
|
|
| During
the year plant production remained excellent and efficiency level of 112% was
achieved. |
|
|
| Despite
excellent production level sales turnover decreased due to adverse market
conditions. During |
|
| the
second half of the year market price of yarn came under pressure due to
Dumping of cheap yarn |
|
| from
the Far Eastern Markets. This eroded the profit margins of the company.
However company was |
|
| able
to meet all its financial obligations. |
|
|
| OPERATIONAL
AND FINANCIAL RESULTS |
|
|
| The
financial results of the company for the year under review are given
hereunder: |
|
|
|
|
|
1999 |
1998 |
|
|
|
|
Rs. '000 |
Rs. '000 |
|
|
|
|
| Operating Profit |
|
|
|
43,435 |
49,163 |
|
| Financial
Charges |
|
|
|
40,547 |
45,968 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
2,888 |
3,195 |
|
| Profit
on Sale of Fixed Assets |
|
|
|
7 |
-- |
|
| Workers
Profit Participation Fund |
|
|
|
(145) |
(160) |
|
|
|
------------------ |
------------------ |
|
| Profit
before Taxation |
|
|
|
2,750 |
3,035 |
|
|
|
|
|
------------------ |
------------------ |
|
| Profit
after Taxation |
|
|
|
2,750 |
3,035 |
|
|
|
|
|
========== |
========== |
|
|
| FUTURE
PROSPECTS |
|
| There
exists a great deal of uncertainty as the prices of Petro Chemical Products
are on the rise worldwide. |
|
| Polyester
Chip, primary raw material of the company being a Petrochemical product is
also under pressure |
|
| and
its prices have increased by more than 20 percent during the last 3 months. |
|
|
| Cheap
imports and dumping of Polyester Filament Yarn is still continuing which is
resulting in lower yarn |
|
| prices
in the local market. |
|
|
| INDUS
POLYESTER COMPANY LIMITED |
|
| Company
is trying to change the product mix in order to improve the average selling
price of its products |
|
| and
hope to improve the performance. |
|
|
| YEAR
2000 COMPLIANCE OF COMPUTER SYSTEM |
|
| The
Company has successfully tested all its computer software for year 2000
compliance. |
|
|
| APPOINTMENT
OF AUDITORS |
|
| The
retiring auditors M/s Hyder Bhimji & Co, Chartered Accountants being
eligible, offer themselves for |
|
| re-appointment. |
|
|
| PATTERN
OF SHARE HOLDING |
|
| Statement
showing pattern of holding as on 30th June 1999 is annexed to the report. |
|
|
| EMPLOYEE
RELATIONS: |
|
| Company's
relation with Labour & Staff continued to remain cordial. We wish to
record our appreciation |
|
| for
the devotion and hard work of the executives, staff members and workers of
the company. |
|
|
|
|
On Behalf of the Board |
|
|
|
|
|
|
|
NAEEM AKHTAR YOUSUF |
|
| Karachi:
18th November, 1999 |
|
Chief Executive |
|
|
|
|
| PATTERN
OF SHAREHOLDING OF SHARES |
|
| AS
AT JUNE 30, 1999 |
|
|
| NO. OF |
SHARE
HOLDING |
TOTAL |
|
|
| SHARE |
|
|
SHARES |
|
|
| HOLDERS |
FROM |
TO |
HELD |
|
|
|
| 442 |
1 |
100 |
44,190 |
|
| 8663 |
101 |
500 |
4,220,400 |
|
| 61 |
501 |
1000 |
60,200 |
|
| 55 |
1001 |
5000 |
149,800 |
|
| 10 |
5001 |
10000 |
79,700 |
|
| 4 |
10001 |
15000 |
54,300 |
|
| 1 |
15001 |
20000 |
18,000 |
|
| 2 |
20001 |
25000 |
44,500 |
|
| 1 |
35001 |
40000 |
40,000 |
|
| 2 |
45001 |
50000 |
99,000 |
|
| 1 |
55001 |
60000 |
56,400 |
|
| 1 |
65001 |
70000 |
70,000 |
|
| 1 |
85001 |
90000 |
85,600 |
|
| 1 |
105001 |
110000 |
107,500 |
|
| 1 |
155001 |
160000 |
157,600 |
|
| 1 |
270001 |
275000 |
275,000 |
|
| 1 |
345001 |
350000 |
349,900 |
|
| 1 |
615001 |
620000 |
618,010 |
|
| 2 |
910001 |
915000 |
1,826,600 |
|
| 1 |
4000001 |
4005000 |
4,003,500 |
|
| ------------------ |
|
------------------ |
|
| 9252 |
|
12,360,200 |
|
| ========== |
|
========== |
|
|
|
|
Categories |
|
No. of |
Total Shares |
Percentage |
|
| S. No. |
Of Share Holders |
Share Holders |
Held |
|
|
|
|
| 1. |
Individuals |
|
9234 |
10,808,390 |
87.45 |
|
| 2. |
Investment Companies |
6 |
506,400 |
4.10 |
|
| 3. |
Joint Stock Companies |
4 |
16,500 |
0.13 |
|
| 4. |
Financial Institutions |
4 |
619,610 |
5.01 |
|
| 5. |
Modaraba Companies |
4 |
409,300 |
3.31 |
|
|
------------------ |
------------------ |
------------------ |
|
|
|
9252 |
12,360,200 |
100.00 |
|
|
========== |
========== |
========== |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed Balance Sheet of INDUS POLYESTER COMPANY LIMITED as
at June |
|
| 30,
1999 and the related Profit & Loss Account and Statement of Changes in
Financial Position (Cash |
|
| Flow
Statement) together with the Notes forming part thereof, for the year then
ended and we state that |
|
| we
have obtained all the information and explanations which to the best of our
knowledge and belief |
|
| were
necessary for the purposes of our audit 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, 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 and Statement of Changes in Financial
Position |
|
| (Cash
Flow Statement) 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, 1 999
and of the Profit |
|
| and
the Statement of Changes in Financial Position (Cash Flow Statement) for the
year then |
|
| ended; and |
|
|
|
| (d)
in our opinion, "no Zakat was deductible at source under the Zakat and
Ushr Ordinance, |
|
| 1980". |
|
|
|
|
|
HYDER BHIMJI & CO. |
|
| Karachi:
18th November, 1999. |
|
Chartered Accountants. |
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
|
|
| AUTHORISED
CAPITAL |
|
|
|
| 12,500,000
Ordinary Shares |
|
|
|
| of Rs. 10/- each |
|
125,000,000 |
125,000,000 |
|
|
|
|
========== |
========== |
|
|
|
|
| ISSUED,
SUBSCRIBED AND PAID UP CAPITAL |
|
|
| 12,360,200
Ordinary Shares |
|
|
|
| of
Rs. 10/- each fully paid issued for cash |
|
|
123,602,000 |
123,602,000 |
|
| issued for cash |
|
|
|
|
|
|
|
|
|
| Accumulated
(Loss) |
|
|
(31,263,407) |
(34,012,970) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
92,338,593 |
89,589,030 |
|
| REDEEMABLE
CAPITAL (Secured) |
|
3 |
166,454,177 |
203,727,737 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Current
Maturity of Redeemable Capital |
|
|
36,598,244 |
30,755,440 |
|
| Short
Term Running Finance |
|
4 |
15,666,532 |
15,708,792 |
|
| Creditors,
Accrued and Other Liabilities |
|
5 |
8,156,876 |
8,153,132 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
60,421,652 |
54,617,364 |
|
|
|
|
------------------ |
------------------ |
|
|
319,214,422 |
347,934,131 |
|
|
|
|
|
========== |
========== |
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating
Fixed Assets |
|
6 |
246,916,369 |
272,862,207 |
|
| Capital
Work-in-Progress |
|
7 |
400,000 |
-- |
|
|
|
|
|
|
| DEFERRED COST |
|
8 |
-- |
1,098,785 |
|
|
|
|
|
| LONG
TERM DEPOSIT |
|
|
|
| Security
Deposits |
|
|
1,568,400 |
1,303,400 |
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
| Stores & Spares |
|
9 |
11,615,172 |
7,348,494 |
|
| Stock in Trade |
|
10 |
42,121,907 |
44,978,467 |
|
| Trade Debts |
|
11 |
11,645,706 |
10,640,850 |
|
| Advance
Income Tax- Refundable |
|
|
600,379 |
3,194,677 |
|
| Advances,
Deposits, Prepayments & Other Receivables |
12 |
1,539,075 |
1,112,629 |
|
| Cash
& Bank Balances |
|
13 |
2,807,414 |
5,394,622 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
70,329,653 |
72,669,739 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
319,214,422 |
347,934,131 |
|
|
|
|
========== |
========== |
|
| NOTE:
The annexed notes form an integral part of these accounts |
|
|
| Karachi:
the 18th November, 1999. |
|
|
|
NAEEM AKHTAR YOUSUF |
|
|
SHAIKH MUHAMMAD YOUSUF |
|
|
Chief Executive |
|
|
Director |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
|
|
| Sales |
|
14 |
289,167,382 |
315,641,545 |
|
| Less:
Cost of Goods Sold |
|
15 |
236,422,982 |
256,825,331 |
|
|
|
|
------------------ |
------------------ |
|
| Gross Profit |
|
|
52,744,400 |
58,816,214 |
|
|
|
|
| OPERATING
EXPENSES: |
|
|
|
| Administrative
Expenses |
|
16 |
8,581,638 |
8,912,991 |
|
| Selling Expenses |
|
17 |
727,874 |
740,368 |
|
|
|
|
------------------ |
------------------ |
|
|
9,309,512 |
9,653,359 |
|
|
|
|
------------------ |
------------------ |
|
| Operating Profit |
|
|
43,434,888 |
49,162,855 |
|
| Financial
Expenses |
|
18 |
40,547,202 |
45,967,680 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
2,887,686 |
3,195,175 |
|
| Profit
on sale of fixed Assets |
|
|
6,591 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
2,894,277 |
3,195,175 |
|
| Workers
Profit Participation Fund |
|
(144,714) |
(159,759) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
before Taxation |
|
|
2,749,563 |
3,035,416 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
after Taxation |
|
2,749,563 |
3,035,416 |
|
| Accumulated
(Loss) Brought forward |
|
(34,012,970) |
(37,048,386) |
|
|
|
|
------------------ |
------------------ |
|
| Accumulated
(Loss) Carried forward |
|
|
(31,263,407) |
(34,012,970) |
|
|
|
|
|
|
========== |
========== |
|
|
| NOTE:
The annexed notes form an integral part of these accounts. |
|
|
| Karachi:
the 18th November, 1999. |
|
|
|
NAEEM AKHTAR YOUSUF |
|
SHAIKH MUHAMMAD YOUSUF |
|
|
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
|
| Cash
generated from operations |
|
20 |
71,600,781 |
76,618,189 |
|
| Financial
charges paid |
|
|
(40,834,469) |
(43,857,004) |
|
| Gratuity paid |
|
|
-- |
(1,193,150) |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash flow from operating activities |
|
|
30,766,312 |
31,568,035 |
|
|
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
|
| Fixed
capital expenditure |
|
|
(1,245,504) |
(2,410,182) |
|
| Capital
Work in Progress |
|
(400,000) |
-- |
|
| Sale
proceeds of Fixed Asset |
|
300,001 |
-- |
|
| (Increase)
/ Decrease in Long Term Deposits |
|
(265,000) |
(9,000) |
|
|
|
------------------ |
------------------ |
|
|
|
|
(1,880,504) |
(2,419,182) |
|
|
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
|
| Repayment
of Redeemable capital |
|
|
(31,430,756) |
(28,618,785) |
|
|
|
|
------------------ |
------------------ |
|
| Net
increase/(decrease) in cash and cash equivalents |
|
(2,544,948) |
530,068 |
|
| Cash
and cash equivalents at beginning of the year |
|
|
(10,314,170) |
(10,844,238) |
|
|
|
|
------------------ |
------------------ |
|
| Cash
and cash equivalents at end of the year |
|
21 |
(12,859,118) |
(10,314,170) |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
| Karachi:
the 18th November, 1999. |
|
|
|
NAEEM AKHTAR YOUSUF |
|
SHAIKH MUHAMMAD YOUSUF |
|
|
Chief Executive |
|
Director |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30,1999. |
|
|
| 1.
STATUS OF THE COMPANY |
|
| The
Company was incorporated in Pakistan on December 2, 1992 as a Public Limited
Company |
|
| and
is listed at Stock Exchanges of Karachi, Lahore & Islamabad. The
principal activity of the |
|
| Company
is to manufacture and sale of Polyester Filament Yarn. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
| 2.1
Accounting Convention: |
|
| These
accounts have been prepared under historical cost convention. |
|
|
| 2.2
Staff Retirement Benefit: |
|
| The
Company operates provident fund scheme for all its employees eligible for the
benefit. |
|
|
| 2.3 Taxation: |
|
| Provision
for current taxation is based on taxable income at the current rates of
taxation after |
|
| considering
tax credits, rebates and exemptions, if any. |
|
|
| 2.4
Deferred Cost: |
|
| The
deferred cost will be written off over a period of 5 years from the
commencement of |
|
| commercial
production. |
|
|
| 2.5
Tangible Fixed Assets: |
|
| Fixed.
Assets are stated at cost less accumulated depreciation except lease hold
land and |
|
| Capital
Work-in-Progress which are stated at cost. |
|
|
| Depreciation
is charged on reducing balance method at the normal rates, addition in a year |
|
| are
depreciated for a full year irrespective of the date of purchase. No
depreciation is charged |
|
| on
assets in the year of their disposal. |
|
|
| 2.6
Stores, spares and Loose Tools: |
|
| Stores and Spares |
· Valued at average cost |
|
|
| 2.7
Stock in Trade: |
|
| Raw
and Packing Material |
Valued at cost- FIFO |
|
|
|
|
| Raw
Material in transit |
Valued at actual |
|
|
| Work in process |
|
Valued at cost of Raw
Material and a proportion |
|
|
of manufacturing
expenses. |
|
|
| Finished goods |
|
Valued at lower of
average cost and net realisable value. |
|
|
| 2.8 Trade Debts: |
|
| Debts
considered irrecoverable, if any, are written offered provision is made for
Debts |
|
| considered
doubtful. |
|
|
|
|
|
|
| 2.9
Revenue Recognition |
|
|
|
| Sales
are recorded on despatch of goods. |
|
|
|
|
|
|
|
|
|
1999 |
1998 |
|
|
|
|
|
RUPEES |
RUPEES |
|
|
|
|
| 3.
REDEEMABLE CAPITAL (Secured) |
|
|
| Long
Term Demand Finance |
|
203,052,421 |
234,483,177 |
|
| (Under
Mark-up arrangements) |
|
|
| Less:
Current Maturity |
|
36,598,244 |
30,755,440 |
|
|
|
------------------ |
------------------ |
|
|
166,454,177 |
203,727,737 |
|
|
|
|
========== |
========== |
|
|
|
|
| a. Security: |
|
|
|
|
| The
above finance is secured by: |
|
|
|
|
|
|
|
|
| i.
1st Charge by way of equitable mortgage of the Project and hypothecation of
Plant/ |
|
| Machinery
and Equipment. |
|
|
|
|
|
|
| ii.
Personal guarantee of the main sponsors. |
|
|
|
|
|
| b.
Rate of Mark - up: |
|
|
|
| The
rate of Mark- up is 48 paisas per 1,000 per day upto 31st March, 1999 and
from 1st |
|
| April,
1999 rate of Mark-up has been reduced to 43 paisas per 1,000 per day. |
|
|
|
|
| c. Repayment: |
|
|
|
|
| The
demand finance are repayable in monthly installments of Rs. 5.800 Million
including |
|
| mark-up
commencing from May' 1997 upto September' 2003. |
|
|
|
|
|
|
|
|
1999 |
1998 |
|
|
|
|
|
RUPEES |
RUPEES |
|
|
|
|
