20000208

Brief recordings

BY SCANNER

Food & Allied Sector

Goodluck Industries Limited

Year Ended June 30, 1999

Overview

The share in the company was listed at the stock exchange in 1970. Last year the market value of the share was recorded between Rs 18.50 and Rs 7 per share. This year the company's status changed for the good. Recently the share price shot-up to Rs 22.80. The strategic decision to generate sales instead of rental income from the factory has paid. During the year under review, after de-leasing the factory, the company produced 19,445,552 kgs of wheat products, sales was recorded in the sum of Rs 151.13 million and gross profit of amounting to Rs 5.04 million was higher as compared to rental income of Rs 1.20 million. The company's turnaround was visible from the relatively improved pre-tax profit of Rs 2.01 million as compared preceding year's Rs 0.70 million. Last year's after tax profit was booked at Rs 2.35 million due to prior year's adjustment and operating profit. This year the company posted net profit at Rs 1.03 million and the company announced at 12%.

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Goodluck Industries Limited is a grain milling unit located on Mauripur Road, SITE Karachi. The share in the company was listed at Karachi Stock Exchange nearly thirty years ago.

The directors reported that during the year under review the status of the company was changed. Its factory was on lease with Zam Zam Wheat Milling (Private) Ltd. since 1982 from July 1, 1998, with mutual consent with the lessee, lease agreement was not renewed and the company started its own operation.

After de-leasing, the factory produced 19,445 thousand metric tonnes of wheat products, although the company could not reach the full capacity of the plant due to short supply of wheat.

It was reported by the directors that the Department of Sindh, Government of Sindh, fixed quota of wheat supply on the basis of the availability of wheat available with them which is far less than the production capacity of the mills. Non-availability of sufficient wheat supply from the open market was also a factor of short-fall in the production. The company also purchased imported wheat from the associated under-taking which helped the factory to improve its actual processing of the wheat products.

For the company the tentative capacity of production, recognised by the Food Department of Government of Sindh is 257,500 kgs per day after working 24, hours a day.

During the year under review, the company's actual production, was 2,415,662 kgs of Maida I; 825,629 kgs of Maida II; 11,755,279 kgs of atta; 793,880 kgs of katta- 10 kgs; 24,332 kgs of suji; 3,355,460 kgs of bran and 275,310 kgs of refraction (by product).

Last year the company's revenue was generated through the rental income which had amounted to Rs 1.20 million and "other" income was in the sum of Rs 0.20 million.

After financial charges and other charges, last year's pre-tax profit was in the sum of Rs 0.70 million profit after tax, last year increased to Rs 2.35 million due to prior year's adjustment.

During the year under review the company's revenue started coming from sales. Sales was in the sum of Rs 151.13 million and cost of sales in the sum of Rs 146.09 million. The company posted gross profit at Rs 5.04 million and pre-tax profit at Rs 2.01 million which was much higher than preceding year's Rs 0.70 million. Profit after tax amounted to Rs 1.03 million and the company's attempt to turnaround the enterprise into profitable venture succeeded.

This year the cash dividend was higher at 12% both in terms of payout rate and amount of Rs 0.36 million. Larger net profit also helped in the reduction of carried forward losses. Accumulated losses declined to Rs 1.20 million from preceding year's Rs 1.87 million.

Break-up value of the share improved to Rs 6 per share from preceding year's Rs 3.76. Total size of the asset shot-up to Rs 15.05 million from previous year's Rs 2.42 million.

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Performance Statistics (Million Rupees)

June 30 1999 1998

Capital & LiabilitiesÉÉÉ

Paid-up Capital: 3.00 3.00

Accumulated (Loss); (1.20) 1.87

Equity: 1.80 1.87

Deferred Liabilities: 3.04 0.04

Current Liabilities: 10.21 1.25

AssetsÉÉÉ

Tangible Fixed Operating Assets: 2.32 0.98

L.T. Deposits: 0.17 0.40

Current Assets: 12.56 1.04

Total Assets: 15.05 2.42

Sales, Profit & PayoutÉÉÉ

Rental Income: Ñ 1.20

Sales: 151.13 Ñ

Gross Profit/Rental Income: 5.04 1.20

Operating Profit: 2.01 0.50

Other Income: Ñ 0.20

Depreciation: 0.34 0.06

Financial Charges: Ñ 0.30

Profit Before Taxation: 2.01 0.70

Profit After Taxation: 1.03 2.35

Dividend Cash 12% (1998: 9%): 0.36 0.27

Financial RatiosÉÉÉ

Share Price (Rs) 20/1/2000: 22.80 Ñ

Book Value Per Share (Rs): 6.00 3.76

Price/Book Value Ratio: 3.80 Ñ

Debt/Equity Ratio: 0:100 0:100

Current Ratio: 1.23 1.30

Asset Turnover Ratio: 10.04 0.49

Days Receivables: Ñ Ñ

Days Inventory: 22 Ñ

Gross Profit Margin (%): 3.33 100.00

Operating Margin (%): 1.33 41.67

Net Profit Margin (%): 0.68 195.83

EPS (Rs): 3.42 7.85

Price/Earning Ratio: 6.67 Ñ

R.O.E. (%): 57.22 207.96

R.O.A. (%): 6.84 97.11

R.O.C.E. (%): 21.28 200.85

Plant Capacity & ProductionÉÉÉ

A) Capacity: "The tentative capacity recognised by the Food Department, Government of Sindh is 257.5 thousand kgs."

B) Actual Production (Thousand Kgs)ÉÉÉ

Maida I: 2,415.66 Ñ

Maida II: 0.83 Ñ

Atta: 11,755.28 Ñ

Katta: 0.79 Ñ

Suji: 3,355.46 Ñ

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Company information: Chief Executive: Haji Hasham Haji Kassam. Director: Mohammad Bachal Memon. Company Secretary: Sadruddin Shariff. Registered Office: S-49/A, SITE, Mauripur Road, Karachi.