| Natover Lease & Refinance Limited |
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| Annual
Report 1999 |
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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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| Pattern
of Shareholding |
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| Auditors'
Report |
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| Balance Sheet |
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| Profit
and Loss Account |
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| Statement
of Changes in Financial Position |
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| Notes
to the Accounts |
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| COMPANY
INFORMATION |
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| BOARD
OF DIRECTORS |
Syed Zahid Hasan |
Chairman |
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Mr. Nadeem H. Shaikh |
Chief Executive |
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|
Mr. Khalid Latif |
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|
Syed Dilawar Abbas |
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|
Brig. (Retd.) M. Zareef
Malik |
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Mr. S. A. Nizami |
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|
Mr. Hasan Ali Fadoo |
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| COMPANY
SECRETARY |
Syed Kabiruddin |
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| AUDITORS |
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M/s. Hyder Bhimji &
Co. |
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Chartered Accountants |
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| LEGAL
ADVISOR |
M/s. Continental Law
Consultant |
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| REGISTRARS
AND SHARE |
M/s. Uni Corporate &
Financial Services |
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| TRANSFER
OFFICE |
Westland Trade Centre, |
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Opp: Flyover,
Shaheed-e-Millat Road, |
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Karachi. |
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Tel: 4313205-6 |
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Fax: 4313207 |
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| REGISTERED
OFFICE |
140, 17th East Street, |
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Off Main Korangi Road, |
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Phase I, D.H.A. Karachi. |
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Tel: 5893881-3 |
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Fax: 5884082 |
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| ISLAMABAD
OFFICE |
4 & 5 Tahir Plaza, |
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Block No. 37, Blue Area, |
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Islamabad. |
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Tel: 276467-8 |
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Fax: 276469 |
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| NOTICE
OF ANNUAL GENERAL MEETING |
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| NOTICE
is hereby given that the 14th Annual General Meeting of NATOVER LEASE &
REFINANCE LIMITED |
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| (Formerly
Natover Motor Lease Limited) will be held on Friday, December 24, 1999 at
8:00 a.m. at the Regis- |
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| tered
Office of the Company at 140, 17th East Street, Off Main Korangi Road, Phase
I, Defence Housing |
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| Authority,
Karachi to transact the following business: |
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|
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| *
To confirm the minutes of the Annual General Meeting held on 24th December
1998. |
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|
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| *
To receive, consider and adopt the audited accounts of the Company for the
period ended June 30, |
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| 1999. |
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| *
To appoint Auditors for the year 1999-2000 and to fix their remuneration. The
present Auditors, M/s. |
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| Hyder
Bhimji & Company, Chartered Accountants, retire and, being eligible,
offer themselves for re- |
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| appointment. |
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| *
To transact any other business with the permission of the Chair. |
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By Order of the Board |
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| Karachi. |
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(SYED KABIRUDDIN) |
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| Dated:
2nd December 1999 |
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Company Secretary |
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| NOTES: |
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| 1.
The Share Transfer Books of the Company will be closed from 15th December
1999 to 21st December |
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| 1999
(both days inclusive). |
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| 2.
A member entitled to attend and vote at this Meeting may appoint another
member as his or her proxy |
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| to
attend and vote. Proxies in order to be effective must be received at the
Registered Office of the |
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| Company
not less than 48 hours before the time of holding the meeting. |
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| 3.
Shareholders are advised to lodge shares for transfer at the Registrar Office
M/s. Uni Corporate & |
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| Financial
Services, Westland Trade Centre, Opp. Fly over, Shaheed-e-Millat Road,
Karachi. |
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| 4.
Members are requested to notify any change in their address immediately. |
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| DIRECTORS'
REPORT |
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| On
behalf of the Board, the 14th Annual Report together with the Audited
Accounts of the Company for the |
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| period
ending 30th June 1999 is presented as follows: |
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| FINANCIAL
RESULTS |
|
RUPEES |
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| REVENUE |
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| Income
from Leases Operations |
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18,941,566 |
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| Ancillary
Financial Services Income |
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4,272,050 |
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| Other Income |
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|
1,199,982 |
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------------------ |
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24,413,598 |
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| EXPENDITURES |
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| Operating |
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|
9,046,855 |
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| Administrative |
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|
9,065,225 |
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| Financial |
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|
11,267,672 |
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|
------------------ |
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|
29,379,752 |
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| Allowance
for Potential Lease Losses: |
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9,500,000 |
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|
------------------ |
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| Loss
before Taxation |
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|
(14,466,154) |
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| Provision
for Taxation |
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|
14,533,420 |
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| Profit
after Taxation |
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|
67,266 |
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| OPERATIONAL
REVIEW |
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| From
the above, it can be observed that during the period under review, total
revenue has increased from 21.8 |
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| (m)
to 24.41 (m) due to the addition of ancillary Financial services. Expenses
have also been reduced from |
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| 31.98
(m) to 29.38 (m) and as a result the Operating loss has reduced from 10.9 (m)
to 6.2 (m). However, due |
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| to
provision for doubtful leases, before tax loss has increased from 10.16 (m)to
14.47 (m). |
|
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| Although
at the time of writing this Report, the chances look very remote that a major
portion of this provision |
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| will
actually convert to loss, nevertheless it was thought prudent to provide for
it. One of the fruits of labor in |
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| leasing
business after 15 years of operation also appears in the accounts in the form
of tax credit. |
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| Lending
of movable assets is the principal business of your Company and sadly it
continues to face tough |
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| competition
and difficulties in obtaining finance from Banks, but there appear to be
positive signs of change in |
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| this
regard at the time of writing this report. |
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| The
Company hopes that in the current year it will be adequately adding to its
lease portfolio. |
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| Your
management, having realized last year that a financial services company such
as yours can not survive |
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| by
its principal business alone, has successfully launched its Ancillary
Services Division. Like all other institu- |
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| tions
engaged in the business of supply of money, it also has a non-fund based
portfolio of services to augment |
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| its
income now. The need to develop a debt market in the country is undesirable
and the skill required to |
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| become
an active participant in the fixed income securities market is present in
your Company. The amend- |
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| ment
in the name of your Company as approved by you to convey this addition in the
nature of its business has |
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| been
implemented. All of which strongly support the expectations of your
management for the future. |
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| The
Company has taken adequate steps regarding Y2K problem and shall be compliant
before end of the year. |
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| AUDITORS |
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| The
present Auditors Hyder Bhimji & Co. Chartered Accountants are retiring
and being eligible, offer them- |
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| selves
for reappointment. |
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| PATTERN
OF SHARE HOLDING |
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| The
pattern of Shareholding as at 30th June 1999 is shown at page 6. |
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| ACKNOWLEDGMENT |
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| I,
on behalf of the Board, would like to express my gratitude to all those who
assisted the Company in its |
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| operations
and would like to place on record our deep appreciation to the staff members
for their dedication and |
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| hard work. |
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|
On behalf of the Board |
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|
SYED ZAHID HASSAN |
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| Karachi:
24th November 1999 |
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Chairman |
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| PATTERN
OF SHAREHOLDING |
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| AS
AT 30TH JUNE 1999 |
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| NUMBER OF |
|
SHAREHOLDING |
|
TOTAL |
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| SHARE |
FROM |
|
TO |
SHARES HELD |
|
|
| HOLDERS |
|
|
| 1002 |
1 |
-- |
100 |
29,922 |
|
| 354 |
101 |
-- |
500 |
127,260 |
|
| 1188 |
501 |
-- |
1000 |
661,108 |
|
| 194 |
1001 |
-- |
5000 |
358,823 |
|
| 19 |
5001 |
-- |
10000 |
122,300 |
|
| 9 |
10001 |
-- |
15000 |
112,701 |
|
| 1 |
15001 |
-- |
20000 |
19,000 |
|
| 3 |
20001 |
-- |
25000 |
70,669 |
|
| 7 |
25001 |
-- |
30000 |
186,714 |
|
| 1 |
45001 |
-- |
50000 |
47,956 |
|
| 1 |
95001 |
-- |
100000 |
95,065 |
|
| 2 |
125001 |
-- |
130000 |
256,720 |
|
| 1 |
220001 |
-- |
225000 |
220,745 |
|
| 1 |
470001 |
-- |
475000 |
473,370 |
|
| 1 |
885001 |
-- |
890000 |
886,930 |
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| 1 |
1580001 |
-- |
1585000 |
1,580,717 |
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| ------------------ |
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------------------ |
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| 2785 |
|
5,250,000 |
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| ========== |
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========== |
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| CATEGORIES |
|
NUMBER OF |
TOTAL |
|
|
| OF
SHARE HOLDERS |
|
SHARE |
SHARE |
PERCENTAGE |
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|
HOLDERS |
HOLDING |
|
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| INDIVIDUALS |
|
2774 |
3,775,474 |
71.91 |
|
| INVESTMENTS
COMPANIES |
|
2 |
137,540 |
2.62 |
|
| JOINT
STOCK COMPANIES |
|
4 |
269,601 |
5.13 |
|
| FINANCIAL
INSTITUTIONS |
|
4 |
1,052,385 |
20.05 |
|
| MODARABA
COMPANY |
|
1 |
15,000 |
0.29 |
|
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|
------------------ |
------------------ |
------------------ |
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|
|
2785 |
5,250,000 |
100.00 |
|
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|
========== |
========== |
========== |
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| AUDITORS'
REPORT TO THE MEMBERS |
|
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| We
have audited the annexed Balanced Sheet of NATOVER LEASE & REFINANCE
LIMITED (Formerly Natover |
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| Motor
Lease Limited) as at June 30, 1999 and the related Profit and Loss Account
for the year then ended and |
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| the
Statement of Changes in Financial Position (Cash Flow Statement) together
with the Notes forming part |
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| thereof,
for the year then ended and we state that we have obtained all the
information and explanations which |
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| to
the best of our knowledge and belief were necessary for the purposes of our
audit and, after due verification |
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| 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; |
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|
|
|
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| (b)
in our opinion; |
|
|
|
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| (i)
the Balance Sheet and Profit and Loss Account together with the notes thereon
have been |
|
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| drawn-up
in conformity with the Companies Ordinance, 1984 and are in agreement with
the |
|
|
| books
of a accounts and are further in accordance with accounting policies
consistently |
|
|
| applied. |
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|
|
|
|
| (ii)
the expenditure incurred during the year were for the purpose of Company's
business; and |
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|
|
|
|
| (iii)
the business conducted, investments made and the expenditure incurred during
the year |
|
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| were
in accordance with the objects of the Company; |
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|
|
|
|
|
| (c)
in our opinion and to the best of our information and according to the
explanations given to us, the |
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| 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 Compa- |
|
| nies
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, 1999 and of the Profit and the Changes
in Financial Position |
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| (Cash
Flows) 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 Ordi- |
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| nance. |
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|
|
|
|
|
|
Hyder Bhimji & Co. |
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| Karachi:
the 24th November 1999 |
|
Chartered Accountants |
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|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
Note |
1999 |
1998 |
|
|
|
Rupees |
Rupees |
|
|
|
|
| SHARE
CAPITAL & REVERSES |
|
|
|
|
|
|
|
|
| AUTHORISED |
|
3 |
100,000,000 |
100,000,000 |
|
|
|
|
========== |
========== |
|
| Issued,
Subscribed & Paid-up |
|
4 |
52,500,000 |
52,500,000 |
|
| Statutory
Reserves |
|
|
1,694,715 |
1,694,715 |
|
| Capital
Reverse-Share Premium A/C |
|
|
6,250,000 |
6,250,000 |
|
| General
Reserve |
|
|
4,750,000 |
4,750,000 |
|
| Accumulated
(Loss) |
|
|
(20,543,126) |
(20,610,392) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(7,848,411) |
(7,915,677) |
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|
|
|
------------------ |
------------------ |
|
| Shareholders
Equity |
|
|
44,651,589 |
44,584,323 |
|
| Long
Term Certificates of Investments |
|
5 |
14,420,000 |
10,705,000 |
|
| Redeemable
Capital - Secured |
|
6 |
-- |
6,371,000 |
|
| Security
Deposits / Adj. Rentals |
|
7 |
2,214,007 |
4,487,766 |
|
| Liabilities
against assets subject |
|
|
|
|
| to
Finance Lease |
|
8 |
-- |
716,407 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
| Current
Portion of Redeemable Capital |
|
6 |
14,999,957 |
12,750,000 |
|
| Current
Portion of Security Deposits/ |
|
|
|
|
| Adjustment
Rentals |
|
7 |
1,981,770 |
3,058,420 |
|
| Current
Portion of Liabilities against |
|
|
|
|
| assets
subject to Finance Lease |
|
8 |
-- |
1,361,578 |
|
| Short
Term Certificates of Investments |
|
5 |
19,442,275 |
5,125,000 |
|
| Shod
Term Running Finance Utilized |
|
|
|
|
| Under
Mark-up Arrangement |
|
9 |
19,124,834 |
22,700,037 |
|
| Creditors.
Accrued & Other Liabilities |
|
10 |
9,539,382 |
10,528,436 |
|
| Dividend
Payable |
|
|
380,858 |
380,858 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
65,469,076 |
55,904,329 |
|
|
|
|
------------------ |
------------------ |
|
|
|
126,754,672 |
122,768,825 |
|
|
|
|
========== |
========== |
|
|
| FIXED
ASSETS |
|
|
|
|
|
|
|
| OPERATING
ASSETS TANGIBLE |
|
11 |
|
|
|
|
| Fleet
of Vehicles Plying for Hire |
|
24,251,998 |
24,970,674 |
|
|
|
------------------ |
------------------ |
|
| Others |
|
|
4,026,941 |
3,377,268 |
|
|
|
28,278,939 |
28,347,942 |
|
|
|
|
|
|
| INVESTMENT
IN LEASES / HIRE PURCHASE |
|
|
| Receivables
under Lease / HP contracts |
|
|
34,230,120 |
57,434,158 |
|
| Less:
Un-earned Income |
|
|
1,343,170 |
3,514,004 |
|
|
|
|
------------------ |
------------------ |
|
| Net
Investment in Leases / HP |
|
|
32,886,950 |
53,920,154 |
|
| Less:
Allowance for potential leases losses |
|
|
9,500,000 |
-- |
|
| Current
Portion of Lease/HP Receivables |
|
|
8,763,345 |
9,145,767 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
14,623,605 |
44,774,387 |
|
| Deferred
Taxation |
|
|
15,000,000 |
-- |
|
| Long
Term Investments |
|
12 |
8,856,176 |
1,284,240 |
|
| Long
Term Deposits, Prepayments |
|
|
| and
Deferred Revenue Expenditures |
|
13 |
2,418,423 |
3,876,296 |
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Current
Portion of Lease / HP Receivables |
|
|
8,763,345 |
9,145,767 |
|
| Vehicles
Stock/Idle Lease Stock |
|
|
8,721,716 |
7,232,732 |
|
| Fixed
Income Securities -Trading Stock |
|
|
3,502,841 |
-- |
|
| Stores
& Spares |
|
|
10,456 |
25,456 |
|
| Rentals
Receivables |
|
14 |
12,302,761 |
6,447,308 |
|
| Loans
and Advances |
|
15 |
5,521,893 |
5,629,455 |
|
| Pre-Payments
and Other Receivables |
|
16 |
17,807,744 |
14,820,431 |
|
| Cash
& Bank Balance |
|
17 |
877,770 |
1,253,814 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
57,508,526 |
44,554,963 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
126,754,672 |
122,768,825 |
|
|
|
|
|
========== |
========== |
|
| NOTE:
The annexed Notes form an integral pad of these accounts. |
|
|
|
(NADEEM H. SHAIKH) |
|
(SYED ZAHID HASAN) |
|
|
CHIEF EXECUTIVE |
|
CHAIRMAN |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
Note |
1999 |
1998 |
|
|
|
Rupees |
Rupees |
|
|
|
|
| Rental Income |
|
|
14,837,996 |
18,177,855 |
|
| Lease
Settlement at Disposals |
|
18 |
3,664,326 |
2,214,963 |
|
| Hire
Purchase Income |
|
|
439,244 |
679,741 |
|
| Ancillary
Financial Services Income |
|
|
4,272,050 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
23,213,616 |
21,072,559 |
|
| Less: Expenses |
|
|
|
| -
Operating |
|
19 |
9,046,855 |
8,746,725 |
|
| - Administrative |
|
20 |
9,065,225 |
9,887,402 |
|
| -
Financial |
|
21 |
11,267,672 |
13,349,763 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
29,379,752 |
31,983,890 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(6,166,136) |
(10,911,331) |
|
| Less:
Allowance for potential lease losses |
|
|
9,500,000 |
-- |
|
| Add:
Other Income |
|
22 |
1,199,982 |
753,555 |
|
|
|
|
------------------ |
------------------ |
|
| (Loss)
before Taxation |
|
|
(14,466,154) |
(10,157,776) |
|
|
|
|
|
|
| Provision
for taxation |
|
|
|
| -Current year |
|
122,000 |
110,000 |
|
| -Previous years |
|
344,580 |
-- |
|
| -Deferred |
|
(15,000,000) |
(750,000) |
|
|
|
|
------------------ |
------------------ |
|
|
|
(14,533,420) |
(640,000) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
/ (Loss) after Taxation |
|
|
67,266 |
(9,517,776) |
|
| Accumulated
(Loss) B/F |
|
|
(20,610,392) |
(11,092,616) |
|
|
|
|
------------------ |
------------------ |
|
| Accumulated
(Loss) C/F to Balance Sheet |
|
|
(20,543,126) |
(20,610,392) |
|
|
|
|
========== |
========== |
|
|
| NOTE:
The annexed notes form an integral part of these accounts. |
|
|
|
(NADEEM H. SHAIKH) |
|
|
(SYED ZAHID HASAN) |
|
|
CHIEF EXECUTIVE |
|
|
CHAIRMAN |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
|
1999 |
1998 |
|
|
|
|
Rupees |
Rupees |
|
|
|
|
|
| Cash
flow from operating activities |
|
|
| Net
(loss) / profit before taxation |
|
(14,466,154) |
(10,157,774) |
|
|
|
|
|
| Adjustments
for: |
|
|
|
| Depreciation |
|
7,522,155 |
6,385,845 |
|
| Amortization
of deferred cost |
|
836,153 |
1,102,302 |
|
| Allowance
for Potential lease losses |
|
9,500,000 |
-- |
|
| Provision
for diminution in value of Investments |
|
22,090 |
132,820 |
|
| Gain
on disposal of assets |
|
(4,394,315) |
(2,831,317) |
|
|
|
|
------------------ |
------------------ |
|
| Operating
(loss) before working capital changes |
|
(980,071) |
(5,368,124) |
|
|
|
|
| (Increase)/Decrease
in loans, advances, prepayments and other |
|
| receivables
/ rent receivables |
|
(8,735,204) |
8,284,015 |
|
| Decrease
in net investment in leases |
|
21,033,204 |
12,639,769 |
|
| (Increase)
in Stores, Idle stock & Inventory Stock |
|
(4,976,825) |
(482,650) |
|
| (Decrease)
in deposits from customers |
|
(3,350,409) |
(4,948,419) |
|
| (Decrease)/Increase
in creditors, accrued and other liabilities |
|
(989,054) |
3,918,865 |
|
|
|
------------------ |
------------------ |
|
| Cash
generated from operations |
|
2,981,712 |
19,411,580 |
|
| Income
taxes (paid)/reverse |
|
(466,580) |
640,000 |
|
|
|
------------------ |
------------------ |
|
| Net
cash from operating activities |
|
1,535,061 |
14,683,456 |
|
| Cash
flows from investing activities |
|
|
| Addition
of fixed assets |
|
(8,123,469) |
(7,245,553) |
|
| Proceeds
from sales of own / leases assets |
|
4,886,226 |
3,699,230 |
|
| Long
term deposits & repayments |
|
1,118,335 |
824,873 |
|
| Addition
in deferred cost |
|
(496,615) |
(181,121) |
|
|
|
------------------ |
------------------ |
|
| Net
cash use investing activities |
|
(2,615,523) |
(2,902,571) |
|
|
|
|
| Cash
flows from financing activities |
|
|
| Proceeds
from COl's |
|
18,032,275 |
2,440,000 |
|
| Repayments
of long term finance |
|
(6,199,028) |
(11,221,585) |
|
| Repayments
of short term finance |
|
(3,575,203) |
(3,357,551) |
|
| Dividend paid |
|
|
-- |
(1,155) |
|
|
|
------------------ |
------------------ |
|
| Net
cash used in financing activities |
|
8,258,044 |
(12,140,291) |
|
|
|
------------------ |
------------------ |
|
| Net
Increase/(decrease) in cash and cash equivalents |
|
7,177,582 |
(359,406) |
|
| Cash
and cash equivalents at July 01,1998 |
|
2,670,874 |
3,030,280 |
|
