| Kohinoor Genertek Limited |
|
|
|
|
|
|
|
| Annual Report 1999 |
|
|
| CONTENTS |
|
|
| Company Information |
|
|
| Notice
of Annual General Meeting |
|
| Directors'
Report to the Shareholders |
|
| Pattern
of Shares Held by the Shareholders |
|
| Auditors'
Report to the Members |
|
| Balance Sheet |
|
|
| Profit and Loss Account |
|
|
| Cash Flow Statement |
|
|
| Notes to the Accounts |
|
|
|
|
| COMPANY
INFORMATION |
|
|
| BOARD OF DIRECTORS |
|
|
| MR.
TARIQ SAYEED SAIGOL |
Chairman |
|
| MR. SARMAD AMIN |
|
Chief Executive |
|
| MR.
TAUFIQUE SAYEED SAIGOL |
|
| MR.
SAYEED TARIQ SAIGOL |
|
| MR.
AAMIR FAYYAZ SHEIKH |
|
| MR.
ASAD FAYYAZ SHEIKH |
|
| MR. USMAN SAID |
|
| MR.
SHAMSUDDIN KHAN |
(Nominee of NIT) |
|
|
| COMPANY SECRETARY |
|
| MR.
MUHAMMAD ASHRAF |
|
|
| AUDITORS |
|
| M/S.
AVAIS HYDER ZAMAN RIZWANI, |
|
| CHARTERED
ACCOUNTANTS |
|
|
| BANKERS |
|
| PRIME
COMMERCIAL BANK LIMITED |
|
| GULF
COMMERCIAL BANK LIMITED |
|
| UNION BANK LIMITED |
|
|
| REGISTERED OFFICE & |
|
| SHARES DEPARTMENT |
|
| 42-LAWRENCE ROAD, |
|
| LAHORE. |
|
| TEL: (92-42) 6302261-62 |
|
| FAX: (92-42) 6368721 |
|
|
| PROJECT |
|
| 8TH
KILOMETER, MANGA RAIWIND ROAD, |
|
| DISTRICT KASUR. |
|
| TEL: (92-04951) 391941-45 |
|
| FAX: (92-04951) 391948 |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the 7th Annual General Meeting of the members of
Kohinoor Genertek |
|
| Limited
will be held on Wednesday, December 29, 1999 at 10.00 a.m. at its Registered
Office, 42- |
|
| Lawrence
Road, Lahore, to transact the following business:- |
|
|
| 1.
To confirm the minutes of the 6th Annual General Meeting held on December 24,
1998. |
|
|
| 2.
To receive, consider and adopt the audited accounts of the Company for the
year ended |
|
| June
30, 1999 together with the Directors' and Auditors' Reports thereof, |
|
|
| 3.
To approve the payment of final cash dividend @ Rs. 1.50 per share of Rs.
10/= each (15%), |
|
| for
the year ended June 30, 1999, as recommended by the Directors. |
|
|
| 4.
To appoint Auditors and fix their remuneration. M/s. Avais Hyder Zaman
Rizwani, Chartered |
|
| Accountants, the retiring auditors, being
eligible offer themselves for re-appointment. |
|
|
| 5.
To transact any other business with the permission of the Chair. |
|
|
|
BY ORDER OF THE BOARD |
|
|
(MUHAMMAD ASHRAF) |
|
| Lahore: December 1, 1999. |
|
Company Secretary |
|
|
| NOTES: |
|
|
|
| 1.
The share transfer books of the Company shall remain closed from December 23,
1999 to |
|
| December
29, 1999 (both days inclusive) and no transfer will be accepted during this
period. |
|
| The
members whose names appear in the register of members as at the close of
business on |
|
| December
22, 1999 will qualify for the payment of cash dividend. |
|
|
| 2.
A member entitled to vote at this meeting is entitled to appoint another
member as proxy. |
|
| Proxies in order to be effective must be
received at 42-Lawrence Road, Lahore, the |
|
| Registered Office of the Company not less
than 48 hours before the meeting and must be |
|
| duly stamped, signed and witnessed. |
|
|
| 3.
Shareholders are requested to promptly notify the Company of any change in
their |
|
| addresses. |
|
|
|
| DIRECTORS'
REPORT TO THE SHAREHOLDERS |
|
|
| The
Directors of your company welcome you to the 7th Annual General Meeting of
the Company, |
|
| and
take pleasure in placing before you their report alongwith audited accounts
and auditors' |
|
| report
thereon for the year ended 30th June, 1999. |
|
|
| OPERATING
AND FINANCIAL RESULTS |
|
|
| Operating |
|
| Power
generated during the year under review totalled at 117,152 MWh as compared to
120,387 |
|
| MWh
last year. However, the dedicated efforts by the management of the Company
have resulted |
|
| in
achieving increased operating profit per MWh generated i.e., Rs. 1,048 when
compared to last |
|
| year's
Rs. 839 showing an overall increase of 25%. |
|
|
| Financial |
|
|
| Your
Company earned a net profit of Rs. 50.177 million as compared to Rs. 75.086
million last year. |
|
| The
operating results of your company showed upward trend when compared with last
year as |
|
| operating
profit ratio improved from 25.92% to 30.64%. However, due to the continued
recession in |
|
| the
stock market coupled with the economic conditions of Pakistan, the market
value of long term |
|
| investments
reduced to Rs. 16.5 million from Rs. 60.9 million. The break-up value of the
invested |
|
| company
as per the audited accounts for the year ended 30 June 1998 was as. 24.04 and
as per |
|
| the
un-audited accounts for the half year ended 31 December 1998 was Rs. 21.23.
The |
|
| summarised
results for the year ended 30 June 1999 are as follows: |
|
|
(Rupees in thousand) |
|
|
1999 |
1998 |
|
|
|
|
| Net
profit of the Company for the year ended 30th June 1999 |
|
50,178 |
75,086 |
|
| Unappropriated
profit brought forward |
|
78,688 |
32,127 |
|
|
------------------- |
------------------- |
|
| Profit
available for appropriation |
|
128,866 |
107,213 |
|
|
|
|
| Appropriations: |
|
| Proposed
Final Cash Dividend @ Rs. 1.50 (1998: Rs. 1.75) |
|
| per share |
|
24,450 |
28,525 |
|
| Transfer
to General Reserve |
|
100,000 |
-- |
|
|
------------------- |
------------------- |
|
|
124,450 |
28,525 |
|
|
------------------- |
------------------- |
|
| Unappropriated
profit carried forward |
|
4,416 |
78,688 |
|
|
------------------- |
------------------- |
|
| Earning per share (Rupees) |
|
3.08 |
4.61 |
|
|
=========== |
=========== |
|
|
|
|
| FUTURE PROSPECTS |
|
| The
reduction in WAPDA's industrial tariff in April 1999 by about 10 to 12% and
increase in furnace |
|
| oil
prices from Rs. 5,500 per metric ton to Rs. 6,070.5 per metric ton in May
1999 will adversely |
|
| affect
your Company's profitability. However, the management of the Company is
exerting its best |
|
| efforts
to minimize the effect on profitability through improved maintenance cost
reductions and |
|
| improvement
in consumption ratio of the petroleum products. |
|
|
| MILLENNIUM BUG |
|
| The
hardware and software systems being used by the Company are Y2K compliant. |
|
|
| ENGINE
MAINTENANCE PROGRAMS |
|
| Overall
performance of Niigata engines remained satisfactory. During the current
financial year two |
|
| engines
are due for major 32,000 hours maintenance and the third engine for 24,000
hours |
|
| maintenance.
In addition, during the current year other periodic maintenance will be
undertaken as |
|
| per
specified schedule of the manufacturer. |
|
|
| STAFF COLONY |
|
| A
phased program for construction of a housing colony to accommodate key staff
members is |
|
| currently
in hand and is due for completion towards the end of the year. Under the
initial phase 2 |
|
| Nos.
two bed room residences 2 Nos. single bed residences, 4 single room quarters
and 10 Nos. |
|
| bachelor
quarters are being constructed. |
|
|
| DIVIDEND |
|
| Your
Directors have recommended a cash dividend @ Rs. 1.50 per share of Rs. 10
each (15%) for |
|
| the
year ended 30th June, 1999. |
|
|
| AUDITORS |
|
| The
auditors M/s. Avais Hyder Zaman Rizwani, Chartered Accountants retire and
being eligible |
|
| offer
themselves for re-appointment. |
|
|
| PATTERN
OF SHARE HOLDING |
|
| Th
pattern of share holding of the Company is included in the Annual Report. |
|
|
| ACKNOWLEDGEMENT |
|
| The
Directors place on record their appreciation for the dedicated efforts made
by the Staff and |
|
| Executives
of the Company and hope that the same spirit of devotion and dedication will
continue |
|
| in future. |
|
|
for and on behalf of the
Board |
|
| Lahore:
Monday, November 22, 1999. |
|
|
(SARMAD AMIN) |
|
|
Chief Executive |
|
|
|
| PATTERN OF SHARES HELD BY
THE SHAREHOLDERS |
|
| AS
AT 30 JUNE 1999 |
|
|
| NO. OF |
SHAREHOLDING |
TOTAL |
|
| SHAREHOLDERS |
FROM |
TO |
SHARES HELD |
|
|
| 16 |
1 |
100 |
1,280 |
|
| 2,651 |
101 |
500 |
1,319,000 |
|
| 114 |
501 |
1,000 |
113,500 |
|
| 184 |
1 001 |
5,000 |
528.60 |
|
| 54 |
5 001 |
10,000 |
438.52 |
|
| 22 |
10 001 |
15,000 |
274 300 |
|
| 8 |
15 001 |
20,000 |
148.50 |
|
| 8 |
20 001 |
25.00 |
192500 |
|
| 2 |
25 001 |
30 000 |
56.50 |
|
| 2 |
30 001 |
35 000 |
66.60 |
|
| 11 |
35 001 |
45 000 |
434 500 |
|
| 4 |
45 001 |
50 000 |
197 500 |
|
| 1 |
50 001 |
55 000 |
53 500 |
|
| 1 |
55.00 |
75 000 |
56 500 |
|
| 2 |
75.00 |
95 000 |
164 500 |
|
| 3 |
95001 |
140 000 |
300 000 |
|
| 1 |
140.00 |
155 000 |
142 200 |
|
| 1 |
155001 |
200 000 |
156 000 |
|
| 1 |
200.00 |
235 000 |
202 000 |
|
| 1 |
235,001 |
240000 |
240 000 |
|
| 1 |
240,001 |
295 000 |
290 000 |
|
| 1 |
295,001 |
995,000 |
909,000 |
|
| 1 |
995,001 |
1,090,000 |
1,000,000 |
|
| 1 |
1,090,001 |
2,155,000 |
1,095,000 |
|
| 1 |
2,155,001 |
2,840,000 |
2,156,000 |
|
| 1 |
2,840,001 |
2,920,000 |
2,843,300 |
|
| 1 |
2,920,001 |
2,985,000 |
2,920,700 |
|
| ------------------- |
------------------- |
------------------- |
------------------- |
|
| 3,094 |
|
GRAND TOTAL |
16,300,000 |
|
|
| Note:
The slabs not applicable have not been shown. |
|
|
| CATEGORIES OF |
NUMBER OF |
NUMBER OF |
PERCENTAGE OF |
|
| SHAREHOLDERS |
SHAREHOLDERS |
SHARES HELD |
ISSUED CAPITAL |
|
| Individuals |
3,070 |
4,988,800 |
30.61 |
|
| Investment Companies |
8 |
1,364,500 |
8.37 |
|
| Joint Stock Companies |
6 |
7,937,100 |
48.69 |
|
| Financial Institutions |
2 |
9,900 |
0.06 |
|
| Modaraba |
2 |
25,000 |
0.15 |
|
| Foreign Investors |
6 |
1,974,700 |
12.12 |
|
|
------------------- |
------------------- |
------------------- |
|
| GRAND TOTAL |
3,094 |
16,300,000 |
100.00 |
|
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of Kohinoor Genertek Limited as at 30
June 1999 |
|
| and
the related profit and loss account and 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 account 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 the 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 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 30 June 1999 and of the profit and cash flow for the year then
ended; |
|
| and |
|
|
| (d)
in our opinion Zakat deductible at source under the Zakat and Ushr Ordinance,
1980 was |
|
| deducted
by the Company and deposited in the Central Zakat Fund established under |
|
| section
7 of that Ordinance. |
|
|
| Date: November 22, 1999. |
|
AVAIS HYDER ZAMAN RIZWANI |
|
| Place: Lahore. |
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET AS AT 30 JUNE 1999 |
|
|
|
|
1999 |
1998 |
|
|
Note |
Rupees |
Rupees |
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
| Authorised Capital |
|
| 30,000,000
ordinary shares of Rs. 10 each |
|
300,000,000 |
300,000,000 |
|
|
=========== |
=========== |
|
| Issued,
subscribed and paid-up capital |
|
3 |
163,000,000 |
163,000,000 |
|
| Reserves |
|
4 |
198,000,000 |
98,000,000 |
|
| Unappropriated profit |
|
|
4,415,746 |
78,688,418 |
|
|
------------------- |
------------------- |
|
|
365,415,746 |
339,688,418 |
|
| LONG
TERM LOANS - Secured |
|
5 |
-- |
22,938,635 |
|
| DEFERRED
LIABILITY - Gratuity |
|
6 |
705,557 |
756,100 |
|
| CURRENT LIABILITIES - |
|
|
| Current
portion of long term loans |
|
28,784,176 |
119,671,662 |
|
| Short
term finance - Secured |
|
65,506,611 |
77,594,011 |
|
| Creditors,
accrued and other liabilities |
|
14,817,726 |
31,663,019 |
|
| Taxation |
|
825,938 |
0 |
|
| Proposed dividend |
|
24,450,000 |
28,525,000 |
|
|
------------------- |
------------------- |
|
|
|
109,384,451 |
257,453,692 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
9 |
-- |
-- |
|
|
|
------------------- |
------------------- |
|
|
500,505,754 |
620,836,845 |
|
|
=========== |
=========== |
|
|
| FIXED
CAPITAL EXPENDITURE |
|
|
| Operating fixed assets |
|
10 |
363,752,328 |
384,418,162 |
|
| Capital work-in-progress |
|
11 |
769,687 |
1,211,667 |
|
|
------------------- |
------------------- |
|
|
364,522,015 |
385,629,829 |
|
| LONG
TERM INVESTMENT |
|
12 |
16,500,000 |
60,900,000 |
|
| LONG
TERM DEPOSITS AND |
|
| DEFERRED COST |
|
13 |
1,874,557 |
5,784,906 |
|
|
| CURRENT ASSETS |
|
| Stores,
spares and loose tools |
|
14 |
31,932,755 |
37,846,588 |
|
| Stock of oil and lubricants |
|
15 |
15,085,293 |
12,264,826 |
|
| Trade debts |
|
16 |
39,216,146 |
37,627,824 |
|
| Advances,
deposits & prepayments |
|
17 |
27,284,630 |
76,514,478 |
|
| Other receivables |
|
18 |
377,890 |
2,031,151 |
|
| Cash and bank balances |
|
19 |
3,712,468 |
2,237,243 |
|
|
|
------------------- |
------------------- |
|
|
117,609,182 |
168,522,110 |
|
|
------------------- |
------------------- |
|
|
500,505,754 |
620,836,845 |
|
|
=========== |
=========== |
|
| The
annexed notes form an integral part of these accounts. |
|
|
| SARMAD AMIN |
|
USMAN SAID |
|
| Chief Executive |
|
Director |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED 30 JUNE 1999 |
|
|
|
|
1999 |
1998 |
|
|
Note |
Rupees |
Rupees |
|
|
| Sales |
|
20 |
400,760,331 |
389,407,553 |
|
| Cost of generation |
|
21 |
271,109,193 |
282,832,064 |
|
|
|
------------------- |
------------------- |
|
| Gross Profit |
|
|
129,651,138 |
106,575,489 |
|
|
|
|
| Administrative
and selling expenses |
|
22 |
6,839,590 |
5,633,473 |
|
|
|
------------------- |
------------------- |
|
| Operating profit |
|
|
122,811,548 |
100,942,016 |
|
| Other income |
|
23 |
3,959,729 |
3,905,245 |
|
|
|
------------------- |
------------------- |
|
|
|
126,771,277 |
104,847,261 |
|
| Financial
and other charges |
|
24 |
68,873,279 |
20,118,156 |
|
| Amortisation
of deferred cost |
|
4,210,349 |
1,928,300 |
|
| Workers'
profit participation fund |
|
2,684,383 |
4,140,040 |
|
|
------------------- |
------------------- |
|
|
75,768,011 |
26,186,496 |
|
|
------------------- |
------------------- |
|
| Profit before taxation |
|
51,003,266 |
78,660,765 |
|
| Taxation |
|
25 |
(825,938) |
(3,574,132) |
|
|
|
------------------- |
------------------- |
|
| Profit after taxation |
|
|
50,177,328 |
75,086,633 |
|
| Unappropriated
profit brought forward |
|
78,688,418 |
32,126,785 |
|
|
------------------- |
------------------- |
|
| Profit
available for appropriation |
|
128,865,746 |
107,213,418 |
|
|
| Appropriation: |
|
| Final
proposed dividend @ Rs. 1.50 (1998 · Rs. 1.75) per share |
|
24,450,000 |
28,525,000 |
|
| Transfer to general reserve |
|
100,000,000 |
-- |
|
|
------------------- |
------------------- |
|
|
124,450,000 |
28,525,000 |
|
|
------------------- |
------------------- |
|
| Unappropriated
profit carried forward |
|
4,415,746 |
78,688,418 |
|
|
=========== |
=========== |
|
| The
annexed notes form an integral part of these accounts. |
|
|
| SARMAD AMIN |
|
USMAN SAID |
|
| Chief Executive |
|
Director |
|
|
|
|
|
1999 |
1998 |
|
|
Note |
Rupees |
Rupees |
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED 30 JUNE 1999 |
|
|
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Cash
generated from operations |
|
26 |
191,042,076 |
32,582,657 |
|
| Financial charges paid |
|
|
(22,692,304) |
(18,197,359) |
|
| Gratuity paid |
|
|
(251,212) |
(27,800) |
|
| Tax paid |
|
|
-- |
(3,574,132) |
|
|
|
------------------- |
------------------- |
|
| Net
cash inflow from operating activities |
|
|
168,098,560 |
10,783,366 |
|
|
|
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Fixed capital expenditure |
|
(20,626,868) |
(8,966,606) |
|
| Long term deposits |
|
(300,000) |
-- |
|
| Proceeds
from sale of fixed assets |
|
1,479,500 |
-- |
|
|
------------------- |
------------------- |
|
| Net
cash outflow from investing activities |
|
(19,447,368) |
(8,966,606) |
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Long term loans |
|
(119,029,535) |
22,938,635 |
|
| Dividend paid |
|
(28,146,432) |
(27,236,995) |
|
|
------------------- |
------------------- |
|
| Net
cash outflow from financing activities |
|
(147,175,967) |
(4,298,360) |
|
|
| Net
increase/(decrease) in cash and cash equivalents |
|
1,475,225 |
(2,481,600) |
|
| Cash
and cash equivalents at the beginning of the year |
|
2,237,243 |
4,718,843 |
|
|
------------------- |
------------------- |
|
| Cash
and cash equivalents at the end of the year |
27 |
3,712,468 |
2,237,243 |
|
|
=========== |
=========== |
|
| The
annexed notes form an integral part of these accounts. |
|
|
| SARMAD AMIN |
|
USMAN SAID |
|
| Chief Executive |
|
Director |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED 30 JUNE 1999 |
|
|
| 1.
THE COMPANY AND ITS OPERATIONS |
|
| Kohinoor
Genertek Limited was incorporated on 28th February, 1993 as a public limited
company |
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| in
Pakistan under the Companies Ordinance, 1984, having the primary object to
undertake power |
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| generation,
distribution and supply of electricity. The shares of the company are quoted
on Karachi |
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| and
Lahore stock exchanges. |
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| 2.
SIGNIFICANT ACCOUNTING POLICIES |
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| The
principal accounting policies which have been adopted in the preparation of
these accounts |
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| are summarized below: |
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| 2.1 Accounting convention |
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| These
accounts have been prepared under the historical cost convention modified to
the |
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| extent
adjustment due to exchange rate fluctuation as stated in note 2.8. |
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| 2.2
Staff retirement benefits |
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| The
company instituted an approved Contributory Provident Fund Scheme for all its |
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| employees
with effect from 1st October 1998. Contributions in respect thereof are made
in |
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| accordance
with the terms of Scheme. The Company therefore disbanded the gratuity |
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| scheme
on 30 September, 1998. |
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| 2.3 Taxation |
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| By
virtue of clause 176 of part 1 of Second Schedule to the Income Tax
Ordinance, 1979, |
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| profits
and gains of the company are exempt from levy of income tax. |
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| The
company is also exempt from minimum tax on turnover under clause 20 of the
part IV of |
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| Second
Schedule of the Income Tax Ordinance, 1979. |
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| 2.4
Fixed capital expenditure |
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| All
fixed capital expenditure are stated at cost less accumulated depreciation
except freehold |
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| land
and capital work in progress which are stated at cost. Depreciation is
calculated on |
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| reducing
balance method at normal rates specified in note No. 10. Full year's
depreciation is |
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| charged
on additions whereas no depreciation is charged on deletions made during the
year. |
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| Maintenance
and normal repairs are charged to income as and when incurred. Major |
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| renewals
and improvements are capitalized. |
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| Gain/losses,
if any, on disposal of assets are taken to profit and loss account. |
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| 2.5 Deferred cost |
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| Expenses,
the benefit of which is expected to spread over several years, are deferred
and |
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| amortised
over a period of not more than five years. |
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| 2.6
Stocks, stores and spares |
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| These
are valued at moving average cost, except in transit which are stated at
actual cost. |
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| 2.7 Revenue recognition |
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| Revenue from supply of electricity is
recognized on issue of bills to customers. |
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| 2.8
Foreign currency translation |
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| Assets
and liabilities in foreign currencies are translated into Pak Rupees at rate
of exchange |
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| ruling
on balance sheet date. Foreign currency transactions, if any, are converted
at the rate |
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| prevailing
on the date of transaction. Resulting gain or loss, if any, relating to
acquisition of |
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| assets
is capitalised and for other transactions, charged to revenue. |
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| 2.9 Investment |
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| Long
term investments are stated at cost. Provision for diminution in value of an
investment is |
