| Shabbir Tiles and Ceramics Limited |
|
|
|
|
|
| Annual
Report 1999 |
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|
|
| CONTENTS |
|
|
|
| Company
Information |
|
|
| Notice
of Meeting |
|
|
| Directors'
Report |
|
|
| Auditors'
Report |
|
|
| Balance Sheet |
|
|
|
| Profit
and Loss Account |
|
|
| Statement
of Changes in Financial Position |
|
| Notes
to the Accounts |
|
|
| Pattern
of Shareholdings |
|
|
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|
|
|
| COMPANY
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
RAFIQ M. HABIB |
Chairman |
|
|
|
ALIREZA M. ALLADIN |
Chief Executive |
|
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|
ALl S. HABIB |
|
|
|
|
ABDUL HAl M. BHAIMIA |
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|
KERSI D. KAPADIA |
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|
|
NAZIM F. HAJI |
|
|
|
|
FARZANA MUNAF |
NIT Nominee |
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| COMPANY
SECRETARY |
SHABBIR ABBAS |
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|
|
|
| AUDITORS |
|
Ford, Rhodes, Robson,
Morrow |
|
|
|
Chartered Accountants |
|
|
| BANKERS |
|
Allied Bank of Pakistan
Limited |
|
|
Habib Bank Limited |
|
|
Habib Bank A. G. Zurich |
|
|
Metropolitan Bank Limited |
|
|
Muslim Commercial Bank
Limited |
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|
National Bank of Pakistan |
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|
Standard Chartered Bank |
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| REGISTERED
OFFICE |
15th Mile Stone, |
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| AND
FACTORY |
National Highway, |
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|
Landhi, Karachi-75120 |
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|
Phones: (021) 5015024 -
25 & 5014044 - 45 |
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|
E-mail:
stilehok@cyber.net.pk |
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| KARACHI
SALES OFFICE |
Room No. 206 & 207,
Clifton Centre, |
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|
Kehkashan, Clifton,
Karachi. |
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|
Phones: (021) 5866001-2
& 5835566 |
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| LAHORE
SALES OFFICE |
FB-2, Second Floor, Awami
Complex, Usman Block, |
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|
New Garden Town, Lahore. |
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|
Phones: (042) 5839982,
5864430 & 5864211 |
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| ISLAMABAD
SALES OFFICE |
Plot No. H-226, Street
No. 7, |
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|
Industrial Area, Sector
1-9, Islamabad. |
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|
|
Phones: (051) 432019
& 432976 |
|
|
| REGISTRARS
AND SHARE |
Noble Computer Services
(Pvt.) Ltd., |
|
| TRANSFER
OFFICE |
2nd Floor, AI-Manzoor
Building, |
|
|
|
Dr. Ziauddin Ahmed Road,
Karachi. |
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|
|
Phones: (021) 2635511 (4
Lines) |
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|
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| NOTICE
OF MEETING |
|
|
| NOTICE
is hereby given that the Twenty-First Annual General Meeting of the Company
will be held |
|
| at
Raffia Choudri Memorial Centre, Sidco Avenue Centre, R. A. Lines, Karachi on
Thursday, the 23rd |
|
| December,
1999 at 9.30 a.m. to transact the following business: |
|
|
| 1.
To confirm the minutes of the 20th Annual General Meeting held on 17th
December, 1998. |
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|
|
|
| 2.
To receive, consider and adopt the audited accounts of the Company for the
year ended 30th |
|
| June,
1999 alongwith the reports of the Directors and Auditors thereon. |
|
|
| 3.
To approve the payment of dividend to the shareholders @ 25% as recommended
by the |
|
| Directors. |
|
|
| 4.
To appoint auditors for the year to end 30th June, 2000 and fix their
remuneration. |
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|
|
|
By Order of the Board |
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|
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|
SHABBIR ABBAS |
|
| Karachi:
24th November, 1999. |
|
Company Secretary |
|
|
| NOTES: |
|
|
| 1.
The share transfer books of the Company will be closed from 9th December,
1999 to 23rd |
|
| December,
1999 (both days inclusive). Dividend will be paid to the members of the
Company |
|
| who
are registered in the books of the Company at the close of business on 8th
December, |
|
| 1999. |
|
|
|
|
|
| Transfers
received in order at the office of the Company's Share Registrars, M/s. Noble |
|
| Computer
Services (Pvt.) Ltd., 2nd Floor, AI-Manzoor Building, Dr. Ziauddin Ahmed
Road, |
|
| Karachi,
at the close of business on 8th December, 1999 will be treated in time for
the purpose |
|
| of
payment of dividend to transferees. |
|
|
|
|
| A
member eligible to attend and vote at the meeting may appoint another member
as his/her |
|
| proxy
to attend and vote on his/her behalf. Proxies to be effective must be
received by the |
|
| Company
not less than 48 hours before the time for holding of the meeting. |
|
|
| 3.
Any individual Beneficial Owner of the Central Depository Company, entitled
to attend and |
|
| vote
at this Meeting must bring his/her National Identity Card with him/her to
prove his/her |
|
| identity,
and in case of proxy must enclose an attested copy of his/her National
Identity Card. |
|
| Representatives
of corporate members should bring the usual documents required for such |
|
| purpose. |
|
|
|
| 4.
Members are requested to communicate to the Company or the Share Registrars
to the |
|
| Company
of any change in their address. |
|
|
| TWENTY-FIRST
REPORT OF THE DIRECTORS FOR |
|
| THE
YEAR ENDED 30TH JUNE, 1999 |
|
|
| The
Directors have pleasure in presenting their report alongwith the audited
accounts for the year |
|
| ended
30th June, 1999. |
|
|
| By
the grace of Almighty Allah, despite adverse economic conditions prevailing
in the Country, your |
|
| Company
generated net sales amounting to Rs. 392 million as against Rs. 346 million
in the previous |
|
| year,
thus registering a growth of 13.29%. Nevertheless, this improvement is not
discernible in the |
|
| gross
and net profit figures as the average selling price has declined because of
market competition |
|
| and
substantially lower selling prices quoted by our competitors and heavy influx
of imported tiles |
|
| at
nominal prices. |
|
|
| FINANCIAL
RESULTS |
|
|
| Profit
after tax for the year under review amounted to Rs. 35 million as against Rs.
49 million for the |
|
| previous
year. Details of the appropriations recommended by the Directors are as
under: |
|
|
|
|
|
1999 |
1998 |
|
|
|
|
|
(Rs. '000s) |
|
|
|
|
| Profit
before taxation |
|
62,344 |
70,107 |
|
|
|
|
|
| Less:
Taxation - Current |
|
18,600 |
19,400 |
|
|
- Prior |
|
1,093 |
-- |
|
|
- Deferred |
|
7,415 |
1,500 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
27,108 |
20,900 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
|
35,236 |
49,207 |
|
| Unappropriated
profit brought forward |
|
|
105 |
350 |
|
|
|
|
------------------ |
------------------ |
|
| Available
for appropriation |
|
|
35,341 |
49,557 |
|
|
|
|
|
|
| APPROPRIATIONS |
|
|
|
|
|
|
|
| PROPOSED: |
|
|
|
| Cash
dividend @ 25% (1998: 20%) |
|
|
18,748 |
13,635 |
|
| Issue
of bonus shares in the ratio of nil (1998: 1: 10) |
|
|
-- |
6,817 |
|
| Transferred
to general reserve |
|
|
16,000 |
29,000 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
34,748 |
49,452 |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
profit carried forward |
|
|
593 |
105 |
|
|
|
|
========== |
========== |
|
|
|
| FUTURE
PROSPECTS |
|
| We
are presently confronted with many production and marketing challenges but,
all the same we |
|
| are
confident of overcoming them. It is our constant endeavour to improve upon
our performance |
|
| and
market share in future with our Professional Management and strong
distribution network. |
|
|
| BOARD
OF DIRECTORS |
|
| During
the period under review Mr. Wusooq Khaleeli, nominee of National Investment
Trust Limited |
|
| resigned
and Mrs. Farzana Munaf was appointed in his place. The Directors wish to
place on record |
|
| their
appreciation of the valuable services rendered by Mr. Wusooq Khaleeli to the
Company and |
|
| welcome
Mrs. Farzana Munaf. |
|
|
| EMPLOYEE
RELATIONS |
|
| Labour
Management relations continued to remain cordial. The Company has started a
voluntary |
|
| programme
for imparting basic education to illiterate workers to fulfill its social
obligations and |
|
| improve
their quality of life. |
|
|
| YEAR
2000 COMPLIANCE OF COMPUTER SYSTEM |
|
| All
devices which are reliant on computer technology as well as operating and
application systems |
|
| used
have been reviewed to determine the impact, if any, that the Year 2000 may
have on their |
|
| ability
to perform properly and plans have been developed accordingly to ensure that
these are in |
|
| place
in good time. |
|
|
| CENTRAL
DEPOSITORY SYSTEM |
|
| Effective
from April 15, 1999, the shares of the Company has become part of the Central
Depository |
|
| System.
This system changes ownership of securities without any physical movement of
certificates |
|
| or
necessity for execution of transfer deeds. The Central Depository System is
operated by the |
|
| Central
Depository Company of Pakistan Limited which records transfer the beneficial
ownership |
|
| of Securities. |
|
|
| PATTERN
OF SHAREHOLDINGS |
|
| The
pattern of Shareholdings is given on page No. 23. |
|
|
| AUDITORS |
|
| Our
present auditors M/s. Ford, Rhodes, Robson, Morrow, Chartered Accountants
retire and offer |
|
| themselves
for reappointment. |
|
|
| ACKNOWLEDGMENT |
|
| In
the end we wish to express our thanks to all our customers for their
patronage and goodwill. We |
|
| thank
our team of dedicated executives, managers, supervisors and workers for their
hard work in |
|
| achieving
optimum results. |
|
|
|
|
On behalf of the Board |
|
|
|
|
|
|
|
ALIREZA M. ALLADIN |
|
| Karachi:
25th October, 1999. |
|
Chief Executive |
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of SHABBIR TILES AND CERAMICS LIMITED
as at |
|
| June
30, 1999 and the related profit and 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 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 the 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, 1999
and of the profit |
|
| and
the changes in financial position (cash flow statement) 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. |
|
|
|
|
FORD, RHODES, ROBSON, MORROW |
|
| Karachi:
25th October, 1999. |
|
Chartered Accountants |
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, |
|
|
|
Note |
1999 |
1998 |
|
|
|
|
|
(Rs. '000s) |
|
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
3 |
140,905 |
131,847 |
|
| CAPITAL
WORK-IN-PROGRESS |
|
4 |
446 |
-- |
|
| LONG-TERM LOANS |
|
|
5 |
95 |
134 |
|
| LONG-TERM
DEPOSITS |
|
|
6 |
5,085 |
3,387 |
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
| Stores and spares |
|
|
7 |
26,882 |
23,940 |
|
| Stock-in-trade |
|
|
|
8 |
66,300 |
61,537 |
|
| Trade
debtors |
|
|
|
9 |
72,752 |
65,773 |
|
| Loans, advances and other
receivables |
|
10 |
23,914 |
16,347 |
|
| Deposits
and prepayments |
|
|
11 |
1,745 |
2,105 |
|
| Cash
and bank balances |
|
|
12 |
34,399 |
24,699 |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
225,992 |
194,401 |
|
| LESS:
CURRENT LIABILITIES |
|
|
|
| Short-term
running finance |
|
|
13 |
24,517 |
24,682 |
|
| Current
maturity of liabilities against assets |
|
|
|
| subject to
finance lease - note 17 |
|
|
12,570 |
9,486 |
|
| Creditors,
accrued and other liabilities |
|
14 |
62,018 |
47,958 |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
99,105 |
82,126 |
|
|
|
|
------------------ |
------------------ |
|
| NET CURRENT ASSETS |
|
|
126,887 |
112,275 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
273,418 |
247,643 |
|
|
|
|
========== |
========== |
|
|
|
|
| FINANCED BY: |
|
|
|
|
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
| Authorised
capital |
|
|
|
| 20,000,000
(1998: 20,000,000) ordinary |
|
|
| shares of Rs. 5 each |
|
|
|
100,000 |
100,000 |
|
|
|
|
========== |
========== |
|
| Issued, subscribed and
paid-up capital |
|
15 |
74,991 |
68,174 |
|
| Reserves |
|
|
16 |
166,593 |
156,922 |
|
|
|
|
------------------ |
------------------ |
|
| SHAREHOLDERS EQUITY |
|
|
|
241,584 |
225,096 |
|
| LIABILITIES
AGAINST ASSETS SUBJECT |
|
|
|
| TO FINANCE LEASE |
|
|
17 |
10,169 |
8,297 |
|
| DEFERRED
LIABILITY |
|
|
|
|
| Taxation |
|
|
|
21,665 |
14,250 |
|
| COMMITMENTS AND CONTINGENCIES |
|
18 |
------------------ |
------------------ |
|
|
|
|
|
273,418 |
247,643 |
|
|
|
|
========== |
========== |
|
|
| These
accounts should be read in conjunction with the annexed notes. |
|
|
|
ALIREZA M. ALLADIN |
|
NAZlM F. HAJI |
|
|
Chief Executive |
|
Director |
|
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, |
|
|
|
Note |
1999 |
1998 |
|
|
|
|
|
(Rs. '000s) |
|
|
|
|
|
| Sales |
|
19 |
392,075 |
346,183 |
|
| Less:
Cost of sales |
|
20 |
268,299 |
219,602 |
|
|
|
|
------------------ |
------------------ |
|
| Gross profit |
|
|
123,776 |
126,581 |
|
| Other
operating income |
|
21 |
1,307 |
1,783 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
125,083 |
128,364 |
|
|
|
|
------------------ |
------------------ |
|
| Selling
and distribution expenses |
|
22 |
36,109 |
32,447 |
|
| Administrative
expenses |
|
23 |
14,630 |
13,411 |
|
| Other
operating charges |
|
24 |
4,525 |
5,026 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
55,264 |
50,884 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
from operations |
|
|
69,819 |
77,480 |
|
| Financial
charges |
|
25 |
7,475 |
7,373 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
before taxation |
|
|
62,344 |
70,107 |
|
|
|
|
|
| Taxation |
|
26 |
|
| Current |
|
|
18,600 |
19,400 |
|
| Prior |
|
|
1,093 |
-- |
|
| Deferred |
|
|
7,415 |
1,500 |
|
|
|
|
------------------ |
------------------ |
|
|
|
27,108 |
20,900 |
|
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
35,236 |
49,207 |
|
| Unappropriated
profit brought forward |
|
105 |
350 |
|
|
|
------------------ |
------------------ |
|
|
|
35,341 |
49,557 |
|
| Appropriations |
|
|
|
| Proposed: |
|
|
|
|
| Dividend
@ 25% (1998: 20%) |
|
|
18,748 |
13,635 |
|
| Issue
of bonus shares in the ratio of nil (1998: 1: 10) |
|
|
-- |
6,817 |
|
| Transferred
to general reserve |
|
|
16,000 |
29,000 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
34,748 |
49,452 |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
profit carried forward to reserve |
|
|
593 |
105 |
|
|
|
|
========== |
========== |
|
| Basic
earning per share |
|
27 |
2.35 |
3.28 |
|
|
|
|
|
|
|
|
|
|
|
| These
accounts should be read in conjunction with the' annexed notes. |
|
|
|
ALIREZA M. ALLADIN |
|
NAZIM F. HAJI |
|
|
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED JUNE 30, |
|
|
|
|
|
|
|
1999 |
1998 |
|
|
|
|
|
(Rs. '000s) |
|
|
|
|
| Cash
flow from operating activities |
|
|
| Net
Profit before taxation |
|
62,344 |
70,107 |
|
| Adjustments |
|
|
|
| Depreciation |
|
15,540 |
13,912 |
|
| Return
on deposit |
|
(1,179) |
(1,139) |
|
| Financial
charges |
|
7,475 |
7,373 |
|
| (Profit)
on sale of fixed assets-net |
|
(116) |
(293) |
|
|
|
------------------ |
------------------ |
|
|
|
21,720 |
19,853 |
|
|
|
|
------------------ |
------------------ |
|
| Operating
profit before working capital changes |
|
84,064 |
89,960 |
|
| (Increase)
/ decrease in stores and spares |
|
(2,942) |
4,761 |
|
| (Increase)
in stock-in-trade |
|
(4,763) |
(13,384) |
|
| (Increase)
in trade debtors |
|
(6,979) |
(11,668) |
|
| (Increase)
/ decrease in loans, advances and other |
|
|
|
| receivables
excluding taxation and return on deposit |
|
(1,553) |
96 |
|
| Decrease
/ (increase) in deposits and prepayments |
|
360 |
(105) |
|
| Increase
in creditors, accrued and other liabilities |
|
|
|
| excluding
mark-up and dividend |
|
8,155 |
1,533 |
|
| (Decrease)
/increase in short-term running finance |
|
(165) |
5,792 |
|
|
|
|
------------------ |
------------------ |
|
| Cash
generated from operations |
|
76,177 |
76,985 |
|
| Financial
charges paid |
|
(7,481) |
(6,910) |
|
| Income
taxes paid |
|
(25,739) |
(34,414) |
|
|
|
------------------ |
------------------ |
|
| Net
cash inflow from operating activities |
|
42,957 |
35,661 |
|
|
|
|
| Cash
flow from investing activities |
|
|
| Purchase
of fixed assets including capital work-in-progress |
|
(25,359) |
(9,715) |
|
| Proceeds
from sale of fixed assets |
|
431 |
1,327 |
|
| Return
on deposit |
|
1,211 |
1,297 |
|
|
|
------------------ |
------------------ |
|
| Net
cash (outflow)in investing activities |
|
(23,717) |
(7,091) |
|
|
|
|
| Cash
flow from financing activities |
|
|
| Liabilities
against assets subject to finance lease |
|
17,092 |
1,529 |
|
| Payment
of liabilities against assets subject to finance lease |
|
(12,136) |
(10,409) |
|
| Dividend paid |
|
|
(12,837) |
(13,744) |
|
| Long-term
loans and deposits-net |
|
(1,659) |
1,074 |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash (outflow) in financing activities |
|
(9,540) |
(21,550) |
|
|
|
------------------ |
------------------ |
|
| Net
increase in cash and cash equivalents |
|
9,700 |
7,020 |
|
| Cash
and cash equivalents at the beginning of the year |
|
24,699 |
17,679 |
|
|
|
------------------ |
------------------ |
|
| Cash
and cash equivalents at the end of the year |
|
34,399 |
24,699 |
|
|
|
|
|
========== |
========== |
|
|
|
|
| These
accounts should be read in conjunction with the annexed notes. |
|
|
|
|
ALIREZA M. ALLADIN |
|
NAZIM F. HAJI |
|
|
Chief Executive |
|
Director |
|
|
|
| NOTES
TO THE ACCOUNTS FOR THE YEAR ENDED JUNE 30, 1999 |
|
|
| 1.
THE COMPANY AND ITS OPERATIONS |
|
| The
Company was incorporated on November 07, 1978 as a public limited company and
is |
|
| listed
on the Karachi, Lahore and Islamabad Stock Exchanges. The main activity of
the |
|
| Company
is manufacture and sale of tiles. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
| 2.1 TAXATION |
|
|
| Provision
for current taxation is based on taxable income on current rates of taxation |
|
| after
taking into account tax rebate and tax credits available under the Income-tax |
|
| Ordinance,
1979, if any. |
|
