| Security Papers Limited |
|
|
|
|
|
|
|
|
|
|
| Annual
Report 1999 |
|
|
|
| BOARD
OF DIRECTORS |
|
| Mr.
Nur Ahmad Shah |
|
Chairman & Managing
Director |
|
| Sheikh
M. Rafiq Akhtar |
|
| Mr.
Shahid Yousuf Baghpatee |
|
| Mr.
Ahmad Hatami Yazd (IDRO) |
|
| Mr.
Kurtcebe Gurkan (SEKA) |
|
| Mr.
Mustapha A. Chinoy |
|
| Mr.
Muhammad Latif |
|
| Mr.
Abdul Rauf Khan |
|
| Dr.
Amjad Waheed |
|
|
| BANKERS |
|
| National
Bank of Pakistan |
|
| Main
Branch, Karachi |
|
|
| AUDITORS |
|
| Rahman
Sarfaraz & Co. |
|
| Chartered
Accountants, |
|
| 115,
SIDCO Avenue Centre, |
|
| 264,
Stratchen Road, |
|
| R.
A. Line, Karachi. |
|
|
| REGISTERED
OFFICE |
|
| 108 (1st Floor), |
|
| Sidco
Avenue Centre, |
|
| Moulana
Din Muhammad Wafai Road, |
|
| Karachi- 74200 |
|
|
| PAPER MILL |
|
| Jinnah
Avenue, Malir Halt, |
|
| Karachi- 75100 |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the Thirty-Fourth Annual General Meeting of Security
Papers |
|
| Limited
will be held on Wednesday the 22nd December, 1999 at 3:30 PM at Raffia
Chaudhri |
|
| Memorial
Centre, SIDCO Avenue Centre (Ground Floor), Opp: Y.M.C.A., Moulana Din |
|
| Muhammad
Wafai Road, Karachi to transact the following business: |
|
|
| 1.
To receive, consider and adopt the Audited Accounts of the Company for the
year |
|
| ended
30th June, 1999 together with the Reports of the Auditors and the Directors. |
|
|
| 2.
To consider and approve payment of 25% Final Cash Dividend making a total of |
|
| 37.50%
for the year ended 30th June, 1999 as recommended by the Board of |
|
| Directors. |
|
|
| 3.
To appoint Auditors for the year 1999-2000 and to fix their remuneration. |
|
|
| 4.
To elect four Directors as fixed by the Board for a term of three years
(other than |
|
| those
nominated by Pakistan Security Printing Corporation (Pvt) Ltd., Turkiye
Seluloz |
|
| Ve
Kagit Fabrikalari and Industrial Development and Renovation Organisation of |
|
| Iran)
in place of the following retiring Directors who are eligible for
re-election:- |
|
|
| Sheikh
M. Rafiq Akhtar |
|
| Mr.
Mustapha A. Chinoy |
|
| Mr.
Muhammad Latif |
|
| Dr.
Amjad Waheed |
|
|
|
By Order of the Board |
|
|
|
|
|
(Muhammad Abdul Aleem) |
|
| Karachi,
22nd November 1999 |
|
Company Secretary |
|
|
|
| NOTES |
|
|
| 1.
The Share Transfer Books of the Company will remain closed from 13th to 22nd |
|
| December,
1999 (both days inclusive). |
|
|
| 2.
Any person who seeks to contest an election to the office of Director shall,
whether |
|
| he
is a retiring Director or otherwise, file with the Company at its Registered
Office |
|
| not
later than fourteen days before the date of the meeting, a notice of his
intention to |
|
| offer
himself for election as a Director. |
|
|
|
| 3.
A member entitled to attend and vote at this meeting may appoint any other
mem- |
|
| ber
as his/her proxy to attend and vote on his/her behalf. The instrument
appointing |
|
| proxy
must be received at the Registered Office of the Company duly stamped and |
|
| signed
not later than 48 hours before the meeting. |
|
|
| 4.
Members whose shares are deposited with Central Depository Company of
Pakistan |
|
| Limited
(CDC) are requested to please bring their original National Identity Cards |
|
| alongwith
the participant's identity number and their account numbers in CDC to |
|
| facilitate
identification at Annual General Meeting. |
|
|
| 5.
Members who desire to stop deduction of Zakat from their dividends may submit
a |
|
| declaration
on non-judicial stamp paper duly signed as required under the law. |
|
|
| 6.
Members are requested to notify any change in address immediately. |
|
|
|
| DIRECTORS'
REPORT |
|
|
| Your
Directors take pleasure in presenting 34th Annual Report and Audited Accounts
for the |
|
| year
ended 30th June, 1999. |
|
|
| PRODUCTION
AND SALE |
|
|
| The
Plant produced 1502 (1998: 1443) tonnes of finished paper - an Increase of 59
tonnes |
|
| (i.e.
4.09%), as compared to the previous year. |
|
|
| Sales
revenue registered an amount of Rs.392.05m (1998: Rs.347.22m) showing
increase |
|
| of
Rs.44.83m (i.e. 12.91%) mainly due to increase in price. |
|
|
| PROFIT
AND APPROPRIATION |
|
|
| Operating
profit increased by 25.54 % as compared to the previous year, i.e. from |
|
| Rs.134.99m
to Rs.169.46m. Pre-tax profit also increased by 48.28% i.e. from Rs.139.85m
in the |
|
| previous
year to Rs.207.37m in the year under review. |
|
|
| After
adding the unappropriated profit of previous year to the profit after
taxation during the |
|
| year,
a sum of Rs.154,056,091 is available for appropriation as against
Rs.122,606,997 in the |
|
| previous
year. During the year Rs.21,981,833 were appropriated towards payment of
Interim |
|
| Cash
Dividend @ 12.5% (i.e. Rs.1.25 per share). |
|
|
| Your
Directors recommend transfer of (a) Rs. 78,409,290 to Plant Replacement
Reserve (b) |
|
| Rs.9,650,000
to General Revenue Reserve and (c) Rs.43,963,665 to Proposed Final Cash
Dividend |
|
| @ 25% (i.e. Rs.2.50 per share). |
|
|
|
1999 |
1998 |
|
|
RUPEES |
RUPEES |
|
|
| Profit
after taxation |
|
154,031,183 |
122,575,296 |
|
| Unappropriated
Profit Brought Forward |
|
24,908 |
31,701 |
|
|
-------------------- |
-------------------- |
|
| Profit
available for appropriations |
|
154,056,091 |
122,606,997 |
|
|
| Appropriations |
|
|
| Transferred to: |
|
|
| Plant
Replacement Reserve |
|
78,409,290 |
62,499,550 |
|
| Employees'
Training Reserve |
|
-- |
3,472,197 |
|
| General
Revenue Reserve |
|
9,650,000 |
1,900,000 |
|
| -
Proposed Cash Dividend |
|
|
|
|
|
|
| Interim
@ 12.5% (1998: NIL) |
|
21,981,833 |
-- |
|
| Final
@ 25% (1998: 20%) |
|
43,963,665 |
35,170,932 |
|
|
-------------------- |
-------------------- |
|
|
65,945,498 |
35,170,932 |
|
| - Reserve for Bonus Shares |
|
| Interim
@ NIL (1998: 12.5%) |
|
-- |
19,539,410 |
|
|
-------------------- |
-------------------- |
|
|
154,004,788 |
122,582,089 |
|
|
-------------------- |
-------------------- |
|
| Unappropriated
Profit Carried Forward |
|
51,303 |
24,908 |
|
|
========== |
========== |
|
|
| EARNING
PER SHARE |
|
| Earning
per share is Rs. 8.76 (1998: Rs. 6.97) as explained at Note 36 of the annexed |
|
| Audited
Accounts. |
|
|
| FUTURE
PROSPECTS |
|
| The
management is in the process of negotiating with the customer, further
increase |
|
| in
the paper price for the year 1998-99. The Directors are hopeful for a
reasonable |
|
| price increase. |
|
|
| Your
Company is endeavouring to increase its plant capacity by about 200-250 |
|
| tonnes
per annum through BMRE, including addition of some locally manufactured |
|
| components.
This is being pursued not only to save foreign exchange but also to |
|
| encourage
locally available technical know how. This would require a sequential |
|
| fabrication
of the plant components according to a well-conceived plan ensuring minimum |
|
| plan
shut down period with optimum results. Some of the components are at advanced |
|
| stage
of fabrication. Our desire is to improve the quality of paper as well. To
achieve |
|
| this,
a fresh financial plan is under consideration. |
|
|
| Your
Directors are optimistic that these steps would bring in more prosperity to |
|
| your
Company in the near future. |
|
|
| DIRECTORS |
|
|
| Dr.
Amjad Waheed has joined the Board in place of Mr. Raziur Rahman Khan while |
|
| Mr.
Khursheed K. Marker (a nominee of Pakistan Security Printing Corporation
(Pvt) |
|
| Limited)
has resigned from the Board. |
|
|
| As
fixed by the Board, four (4) Directors are to be elected for a term of three
years |
|
| (other
than those nominated by Pakistan Security Printing Corporation (Pvt) Limited, |
|
| Turkiye
Seluloz Ve Kagit Fabrikalari and Industrial Development and Renovation |
|
| Organisation
of Iran) in place of the following retiring Directors who are eligible for
re- |
|
| election:- |
|
|
| Sheikh
M. Rafiq Akhtar |
|
| Mr.
Mustapha A. Chinoy |
|
| Mr.
Muhammad Latif |
|
| Dr.
Amjad Waheed |
|
|
|
| AUDITORS |
|
| The
Auditors, M/s. Rahman, Sarfaraz & Co., Chartered Accountants have offered |
|
| themselves
for reappointment. |
|
|
| SHAREHOLDING
PATTERN |
|
| The
pattern of shareholding is at page No. 29. |
|
|
| YEAR
2000 COMPLIANCE |
|
| The
Company has successfully complied with the year 2000 issue, in respect of |
|
| millennium bug. |
|
|
| ACKNOWLEDGEMENT |
|
| Once again, it is our privilege to bring on
record the dedicated efforts put in by the |
|
| Company
employees. |
|
|
|
On behalf of the Board of Directors |
|
|
|
|
|
NUR AHMAD SHAH |
|
| Karachi:
22nd November, 1999 |
|
Managing Director |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of Security Papers Limited as at |
|
| 30th
June, 1999 and the related profit and loss account and statement of changes
in financial |
|
| position,
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 knowl- |
|
| edge
and belief were necessary for the purpose 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 |
|
| 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, 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 30th June,
1999 and |
|
| of
the profit and changes in financial position 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. |
|
|
| Karachi |
|
RAHMAN SARFARAZ & CO. |
|
| Dated:
25 November, 1999 |
|
Chartered Accountants |
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
| SHARE
CAPITAL AND RESERVES |
|
| Authorised
Capital |
|
| 70,000,000
Ordinary Shares of Rs.10/= each |
|
700,000,000 |
700,000,000 |
|
|
========== |
========== |
|
| Issued,
Subscribed and Paid up Capital |
|
3 |
175,854,660 |
175,854,660 |
|
| Plant
Replacement Reserve |
|
4 |
140,908,840 |
62,499,550 |
|
| Employees'
Training Reserve |
|
5 |
-- |
14,195,924 |
|
| General
Revenue Reserve |
|
6 |
192,015,924 |
168,170,000 |
|
| Reserve
for Bonus Shares |
|
7 |
0 |
0 |
|
| Unappropriated
Profit. |
|
51,303 |
24,908 |
|
|
------------------ |
------------------ |
|
|
508,830,727 |
420,745,042 |
|
|
|
|
| DEFERRED
LIABILITIES |
|
| Deferred
Taxation |
|
1,275,000 |
-- |
|
|
| CURRENT
LIABILITIES |
|
| Deposits
Repayable on Demand |
|
9 |
2,979,107 |
1,695,160 |
|
| Creditors |
|
|
2,229,822 |
2,094,773 |
|
| Accrued
Liabilities |
|
10 |
45,029,321 |
55,056,023 |
|
| Other Liabilities |
|
11 |
840,187 |
578,133 |
|
| Workers'
Profit Participation Fund |
|
12 |
11,173,447 |
7,430,290 |
|
| Workers'
Welfare Fund |
|
|
3,128,892 |
448,854 |
|
| Provision
for Taxation |
|
24 |
23,315,612 |
-- |
|
| Unclaimed
Dividend |
|
795,031 |
225,508 |
|
| Proposed
Final (Cash) Dividend |
|
43,963,665 |
35,170,932 |
|
|
------------------ |
------------------ |
|
|
133,455,084 |
102,699,673 |
|
|
------------------ |
------------------ |
|
| CONTINGENCIES
AND CAPITAL COMMITMENTS |
13 |
|
|
|
|
643,560,811 |
523,444,715 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| FIXED
ASSETS - TANGIBLE |
|
|
|
| At Cost |
|
14 |
67,156,451 |
59,068,383 |
|
| Less:
Accumulated Depreciation |
|
49,142,566 |
47,619,057 |
|
|
------------------ |
------------------ |
|
|
18,013,885 |
11,449,326 |
|
|
|
|
| LONG
TERM INVESTMENTS |
|
15 |
336,871,624 |
193,866,245 |
|
| LONG
TERM LOANS AND ADVANCES |
|
16 |
84,562 |
76,723 |
|
| LONG
TERM DEPOSITS AND DEFERRED COSTS |
17 |
22,227,549 |
31,727,953 |
|
|
|
|
|
|
|
|
|
| CURRENT
ASSETS |
|
| Stores
and Spare Parts |
|
18 |
17,921,499 |
17,205,207 |
|
| Loose Tools |
|
|
92,814 |
91,994 |
|
| Stock in Trade |
|
19 |
45,218,139 |
43,316,551 |
|
| Trade
Debts - Unsecured (Considered good) |
|
20 |
90,821,000 |
148,654,111 |
|
| Loans
and Advances (Considered good) |
|
21 |
294,894 |
1,083,996 |
|
| Deposits
and Prepayments |
|
|
841,379 |
892,102 |
|
| Markup
and Dividend Receivables |
|
22 |
3,387,071 |
4,574,274 |
|
| Other
Receivables |
|
23 |
1,021,354 |
1,546,679 |
|
| Income
Tax Refund Due from Government |
|
24 |
-- |
5,298,579 |
|
| Short
Term Investments and Deposits |
|
25 |
100,316,026 |
59,295,000 |
|
| Cash
and Bank Balances |
|
26 |
6,449,015 |
4,365,975 |
|
|
|
------------------ |
------------------ |
|
|
266,363,191 |
286,324,468 |
|
|
------------------ |
------------------ |
|
|
643,560,811 |
523,444,715 |
|
|
|
========== |
========== |
|
|
|
|
|
|
| The
annexed notes form an integral part of these accounts |
|
|
|
NUR AHMAD SHAH |
|
SHEIKH M. RAFIQ AKHTAR |
|
|
Managing Director |
|
Director |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30,1999 |
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
| SALES - NET |
|
27 |
392,046,448 |
347,219,723 |
|
| Less:
Cost of Goods Sold |
|
28 |
192,546,558 |
180,734,883 |
|
|
------------------ |
------------------ |
|
| GROSS
PROFIT |
|
199,499,890 |
166,484,840 |
|
| OPERATING
EXPENSES |
|
|
|
| Administrative
and General Expenses |
|
29 |
129,387,805 |
310,730,111 |
|
| Financial
Charges |
|
30 |
647,281 |
424,622 |
|
|
|
------------------ |
------------------ |
|
|
30,035,086 |
31,497,633 |
|
|
------------------ |
------------------ |
|
| OPERATING
PROFIT |
|
169,464,804 |
134,987,207 |
|
| Add:
Other Income |
|
31 |
49,108,083 |
26,918,038 |
|
|
------------------ |
------------------ |
|
|
218,572,887 |
161,905,245 |
|
| Add/(Less): |
|
| Provision
for Diminution in NIT Units |
|
3,005,379 |
(9,546,498) |
|
| Loss
on Redemption of NIT Units |
|
-- |
(4,674,755) |
|
|
------------------ |
------------------ |
|
|
3,005,379 |
( 14,221,253) |
|
|
------------------ |
------------------ |
|
|
221,578,266 |
147,683,992 |
|
|
| Less:
Workers' Profit Participation Fund |
|
12 |
11,078,913 |
7,384,200 |
|
| Workers'
Welfare Fund |
|
3,128,892 |
448,854 |
|
|
------------------ |
------------------ |
|
|
14,207,805 |
7,833,054 |
|
|
------------------ |
------------------ |
|
| PROFIT
BEFORE TAXATION |
|
207,370,461 |
139,850,938 |
|
| TAXATION |
|
| Current |
|
52,064,278 |
17,275,642 |
|
| Deferred |
|
1,275,000 |
-- |
|
|
------------------ |
------------------ |
|
|
53,339,278 |
17,275,642 |
|
|
------------------ |
------------------ |
|
| PROFIT
AFTER TAXATION |
|
154,031,183 |
122,575,296 |
|
| UNAPPROPRIATED
PROFIT BROUGHT FORWARD |
|
24,908 |
31,701 |
|
|
|
------------------ |
------------------ |
|
| PROFIT
AVAILABLE FOR APPROPRIATIONS |
|
154,056,091 |
122,606,997 |
|
|
|
========== |
========== |
|
|
|
| APPROPRIATIONS |
|
| Transferred to: |
|
| -
Plant Replacement Reserve |
|
78,409,290 |
62,499,550 |
|
| - Employees' Training Reserve |
|
-- |
3,472,197 |
|
| -
General Revenue Reserve |
|
9,650,000 |
1,900,000 |
|
| -
Proposed Cash Dividend |
|
|
|
| Interim
@ 12.5% (1998: NIL) |
|
21,981,833 |
-- |
|
| Final
@ 25% (1998: 20%) |
|
43,963,665 |
35,170,932 |
|
|
------------------ |
------------------ |
|
|
65,945,498 |
35,170,932 |
|
| Reserve
for Bonus Shares |
|
|
|
| Interim
@ NIL (1998: 12.5%) |
|
-- |
19,539,410 |
|
|
------------------ |
------------------ |
|
|
154,004,788 |
122,582,089 |
|
|
------------------ |
------------------ |
|
| UNAPPROPRIATED
PROFIT CARRIED FORWARD |
|
51,303 |
24,908 |
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts |
|
|
|
NUR AHMAD SHAH |
|
SHEIKH M. RAFIQ AKHTAR |
|
|
Managing Director |
|
Director |
|
|
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
1999 |
1998 |
|
|
RUPEES |
RUPEES |
|
|
| A.
CASH FLOW FROM OPERATING ACTIVITIES |
|
| Profit
before taxation |
|
207,370,461 |
139,850,938 |
|
| Adjustment for: |
|
|
|
| Depreciation |
|
2,435,511 |
1,451,535 |
|
| Amortization
of Deferred Cost |
|
10,080,704 |
10,080,704 |
|
|
------------------ |
------------------ |
|
| Profit
on Disposal of Fixed Assets |
|
(616,371) |
(726,229) |
|
| Other Income |
|
(48,491,712) |
(26,191,809) |
|
|
------------------ |
------------------ |
|
|
(49,108,083) |
(26,918,038) |
|
|
------------------ |
------------------ |
|
| Provision
for Diminution in NIT Units |
|
(3,005,379) |
9,546,498 |
|
| Loss
on Redemption of NIT Units |
|
-- |
4,674,755 |
|
|
------------------ |
------------------ |
|
|
(3,005,379) |
14,221,253 |
|
| Financial
Charges |
|
647,281 |
424,622 |
|
| Taxes Paid |
|
(23,450,087) |
(15,399,923) |
|
| Dividend Paid |
|
(56,583,242) |
(246) |
|
|
------------------ |
------------------ |
|
|
(118,983,295) |
(16,140,093) |
|
|
------------------ |
------------------ |
|
| Operating
Profit Before Working Capital Changes |
|
88,387,166 |
123,710,845 |
|
|
|
|
| Changes
in Working Capital |
|
| (Increase)/Decrease
in Current Assets |
|
| Stores
and Spare Parts |
|
(716,292) |
1,603,306 |
|
| Loose Tools |
|
(820) |
(5,198) |
|
| Stock in Trade |
|
(1,901,588) |
(10,145,012) |
|
| Trade Debts |
|
57,833,111 |
(59,364,449) |
|
| Loans
and Advances |
|
789,102 |
96,411 |
|
| Deposits
and Prepayments |
|
50,723 |
(89,556) |
|
| Mark-up
and Dividend Receivables |
|
1,187,203 |
5,823,814 |
|
| Other
Receivables |
|
525,325 |
(816,912) |
|
|
------------------ |
------------------ |
|
|
57,766,764 |
(62,897,596) |
|
| Increase/(Decrease)
in Current Liabilities |
|
|
| Deposits
Repayable on Demand |
|
1,283,947 |
281,293 |
|
| Creditors |
|
135,049 |
(7,344) |
|
| Accrued
Liabilities |
|
(10,026,702) |
11,512,146 |
|
| Other Liabilities |
|
262,054 |
(896,850) |
|
| Workers'
Profit Participation Fund |
|
3,743,157 |
3,534,834 |
|
| Workers'
Welfare Fund |
|
2,680,038 |
182,261 |
|
|
------------------ |
------------------ |
|
|
(1,922,457) |
14,606,340 |
|
|
------------------ |
