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PAKISTAN NATIONAL SHIPPING CORPORATION |
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|
(Report and Accounts for
the year ended 30th June, 1996) |
|
|
| CONTENTS |
|
|
| MANAGEMENT,
AUDITORS AND BANKERS |
2 |
|
| NOTICE
FOR MEETING |
|
3 |
|
| REPORT
OF THE BOARD OF DIRECTORS |
4 |
|
| AUDITORS'
REPORT |
|
9 |
|
| BALANCE
SHEET |
|
10 |
|
| PROFIT
AND LOSS ACCOUNT |
|
12 |
|
| CASH
FLOW STATEMENT |
|
13 |
|
| NOTES
TO THE ACCOUNTS |
|
14 |
|
| PATTERN
OF SHAREHOLDING |
|
39 |
|
| STATEMENT UNDER SECTION 237 OF |
|
| THE
COMPANIES ORDINANCE 1984 |
40 |
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|
|
| PAKISTAN
CO-OPERATIVE SHIP STORES (PRIVATE) LTD. |
|
| (SUBSIDIARY
COMPANY OF PAKISTAN NATIONAL SHIPPING |
|
| CORPORATION) |
|
|
| CHAIRMAN
& CHIEF EXECUTIVE REPORT |
42 |
|
| AUDITORS'
REPORT |
|
43 |
|
| BALANCE
SHEET |
|
44 |
|
| PROFIT
& LOSS ACCOUNT |
|
46 |
|
| NOTES
TO THE ACCOUNTS |
|
47 |
|
| SHAREHOLDERS
STATISTICS |
|
50 |
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|
|
| MANAGEMENT,
AUDITORS AND BANKERS |
|
|
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| Board: |
|
Rear Admiral (Retd.)
Javaid Ali |
|
|
H.I.(M) S.Bt. |
|
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|
Chairman. |
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|
Mr. Mohsin Manzoor |
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|
Vice Chairman &
Director (Administration) |
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|
Mr. Fazal-ur-Rehman |
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|
Director (Finance) |
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|
|
|
Cdre Mirza Ashfaque Beg |
|
|
|
Director (Ship
Management) |
|
|
|
|
|
Mr. Jahangir Siddiqui |
|
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|
Director |
|
|
|
|
Mr. Mohammad Khusrow
Khowaja |
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|
Director |
|
|
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| Secretary: |
|
Mr. K. Daud Shams |
|
|
|
| Registered
Office: |
PNSC Building, Moulvi
Tamizuddin Khan Road, |
|
|
Karachi-74000. |
|
|
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| Auditors: |
|
A.F. Ferguson & Co. |
|
|
Chartered Accountants |
|
|
|
|
|
Taseer Hadi Khalid &
Co. |
|
|
Chartered Accountants |
|
|
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| Bankers: |
|
National Bank of Pakistan |
|
|
|
Habib Bank Limited |
|
|
|
Muslim Commercial Bank
Limited |
|
|
United Bank Limited |
|
|
|
Industrial Development
Bank Of Pakistan |
|
|
|
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|
NOTICE FOR MEETING |
|
|
|
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| Notice
is hereby given that the 18th Annual General Meeting of the shareholder of
Pakistan National |
|
| Shipping
Corporation will be held at Pakistan Navy Fleet Club, near Lucky Star Hotel,
Saddar |
|
| Karachi,
on Thursday the 26 December, 1996 at 12:00 Noon to transact the following
business: |
|
|
| 1.
To confirm the Minutes of the 17th Annual General Meeting of the Shareholders
of PNSC held |
|
| on
31st December, 1995. |
|
|
| 2.
To consider and adopt the Balance Sheet, the Profit and Loss Account and the
Reports of |
|
| Auditors
and Directors for the year ended 30th June, 1996. |
|
|
| 3.
To appoint auditors for the year 1996-97 and to fix their remuneration. |
|
|
| 4.
To do any other business that may be placed before the meeting with
permission of the |
|
| Chairman. |
|
|
By Order of the Board |
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|
|
K. DAUD SHAMS |
|
| Dated:
11th November, 1996 |
Secretary |
|
|
|
|
|
| Note: |
|
|
|
| 1.
A Shareholder entitled to attend and vote at this meeting is also entitled to
appoint his/her proxy |
|
| to
attend the meeting. |
|
|
|
|
| 2.
Proxy must be received at the Registered Office of the Corporation not less
than 48 hours before |
|
| the time for holding the meeting. |
|
|
|
| 3.
Shareholders are requested to notify any change in their address immediately. |
|
|
| 4.
The share transfer books of the Corporation will remain closed from 19th
December to 26th |
|
| December,
1996 (both days inclusive). |
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|
| ANNUAL
REPORT |
|
| FOR
THE YEAR ENDED 30TH JUNE, 1996 |
|
|
| The Directors of Pakistan National
Shipping Corporation are pleased to present the |
|
| Eighteenth
Annual Report together with the Audited Accounts of the Corporation for the
year |
|
| ended
30th June, 1996. |
|
|
| The year 1995-96 has remained a difficult
year for the Shipping Industry in Pakistan. The |
|
| country's
exports have failed to achieve the desired target and the crisis in the
textile industry |
|
| persisted.
The fluctuations in the charter market remained unpredictable which impaired
the |
|
| Corporation's
profitability. |
|
|
| The ageing fleet of the Corporation has
resulted in increased repair and maintenance costs. The |
|
| continued
depreciation of Pakistan Rupee against major currencies of the World has
aggravated the |
|
| situation
and resulted in further increase in our operational costs. This has also
affected our debt |
|
| servicing. |
|
|
| Despite all these problems, we are
pleased to announce that the Corporation has earned an after |
|
| tax
profit of Rs. 39.152 millions during the year as compared to a loss of Rs.
443.208 million in |
|
| corresponding
period of the previous year. |
|
|
| AUDITORS
OBSERVATIONS |
|
| The Auditors have qualified their report
on the issue of turnover Tax under Section 80D of the |
|
| Income
Tax Ordinance, 1979. This tax has not been provided in the books by the
Corporation, as the |
|
| Corporation
contends that Section 80D of the Income Tax Ordinance is ultra vires to the
constitution |
|
| of
the country. Corporation has filed an appeal in the Sindh High Court for
declaring this Section of |
|
| the
Income Tax Ordinance, 1979 void and of no legal effect. |
|
|
|
| BORROWINGS |
|
| The Corporation obtained a loan of USS 50
million from National Bank of Pakistan, Bahrain, |
|
| guaranteed
by the State Bank of Pakistan, under a Facility Agreement signed between PNSC
and |
|
| NBP.
Through this loan facility, the Corporation acquired three second hand
container vessels during |
|
| the year. |
|
|
|
| FLEET |
|
| During the year 1995-96 PNSC inducted 3
Second hand Container vessels in the fleet. On 30th |
|
| June
1996, the PNSC fleet stood at 17 vessels. Average age of the fleet was 16
years. |
|
|
| Out of these 12 multipurpose general
cargo ships had an average age of about 15 years, whereas |
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| 2
conventional general cargo ships were 24 to 28 years old. Total deadweight of
the fleet was 290,353 |
|
| tons
with container capacity of 8,483 TEU's. |
|
|
| COMMERCIAL
OPERATIONS |
|
| During the year the Corporation performed
a total of 572 voyage (including foreign chartered |
|
| vessels)
and lifted 6.236 million freight tons as against 527 voyages and 5.059
million freight tons |
|
| during
1994-95. The total Revenue generated was Rs. 6,962 million as against Rs.
5,160 million in |
|
| the
year 1994-95. |
|
|
| PNSC gainfully utilized the Right of
First Refusal. The Corporation lifted 23% more cargo |
|
| during
1995-96 as compared to preceeding year. The sector-wise break-up of cargo
liftings and its |
|
| comparison
with the previous year is as follows: |
|
|
|
1995-96 |
1994-95 |
|
|
Freight Tons |
Freight Tons |
|
|
(Million) |
(Million) |
|
|
| Asia |
|
0.80 |
0.89 |
|
|
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| Europe |
|
0.43 |
0.36 |
|
|
|
|
| USA/Canada |
|
0.20 |
0.21 |
|
|
|
|
| Dry
Bulk Cargo |
4.81 |
3.61 |
|
|
| The
containers lifted during the year were 21,693 TEUS as compared to 22,315 in
the previous |
|
| year. |
|
|
| Over 33 percent increase in bulk cargo
liftings was mainly due to securing of entire coal |
|
| affreightment
contract without exercising Right of First Refusal compared to 0.026 million
tons in |
|
| 1994-95.
PNSC carried 0.901 million tons Coal during the period under review.
Similarly iron ore |
|
| liftings
during the year increased to 1.772 million tons from 1.451 million tons in
the preceeding year. |
|
| Wheat
liftings also increased to 1.724 million tons as against 1.478 million tons
during 1994-95. The |
|
| bulk
cargo was lifted on chartered vessels as at percent PNSC does not own any
bulk carrier. The 3 |
|
| second
hand container vessels acquired during the year were gainfully utilized on
time charter basis. |
|
|
| INSURANCE
& CLAIMS |
|
| The high standard of performance was
maintained by PNSC Fleet enabling us to negotiate our |
|
| Fleet
insurance on the reasonable record with the Underwriters for the year under
review. |
|
|
|
| The Insurance Market is gradually coming
out of the crisis which it was facing since last many |
|
| years
and we were able to negotiate the PNSC Fleet Hull & Machinery Insurance
Policy for the year |
|
| 1996
with Messrs National Insurance Corporation at a very competitive rate. |
|
|
| The Corporation also succeeded to obtain
a reasonable reduction in premium rate for PNSC |
|
| Fleet
P&I Cover for the year 1996-97 from Messrs Steamship Mutual Underwriting
Association Ltd., |
|
| London. |
|
|
| Effective loss control has been exercised
during the year using best of the professional skill |
|
| to
retain the confidence of Shippers/Consignees as per requirement of the trade. |
|
|
| STORES
& SUPPLY |
|
| Extreme economy was maintained in the
procurement and supply of stores to our vessels. |
|
| Major
and costly items of stores were imported direct from abroad, thus saving
considerable amount. |
|
| Self
catering scheme has continued to be of financial benefit to the Corporation.
Ship Laundry |
|
| expenses
in foreign exchange have been eliminated in avoidable circumstances and the
new system |
|
| is
working satisfactorily. |
|
|
| BUNKER
& SPARES |
|
| 1.
International Bunker Prices showed an average decrease of (1) one percent.
The prices |
|
| of
Lubricants have increased by 3 percent. |
|
|
|
| 2.
The volume of bunker procured during the year was 3 percent less than the
previous |
|
| year.
To curtail the expenditure, maximum bunkers were procured from the cheapest |
|
| ports
on operating routes of the vessels. |
|
|
|
| 3.
As the vessels were getting older larger quantities of spares had to be
procured for |
|
| efficient
operation of machinery of ships and this resulted in increased expenditure on |
|
| the
cost of spare parts. |
|
|
|
| MAINTENANCE
& REPAIRS |
|
| During the year ended the 30th June, 1996
the old and obsolete vessel M.V. Hunza was sold |
|
| for
scrapping and following three new vessels inducted in the PNSC Fleet: |
|
|
|
| 1.
M.V. LALAZAR |
|
| 2.
M.V. SHALAMAR |
|
| 3.
M.V. SWAT |
|
|
| Constraints of an aging fleet not
with-standing, efforts were continued during the year to |
|
| maximise
utilization of available tonnage and curtail expenditure on repairs inspire
of increasing cost |
|
| of
repairs and new rules and regulations of classification Societies. |
|
|
| Indigenous resources were put to maximum
use of the Maintenance and repairs of the |
|
| Corporation's
vessels. PNSC Workshop undertook maximum burden of this task. |
|
|
| Economy continued to be maintained in the
procurement of Spares and Stores for the vessels. |
|
|
| PLANNING
DEVELOPMENT |
|
| Subsequent to the approval granted by the
Government to restructure the fleet of the |
|
| Corporation,
ECC of the Cabinet in its meeting held on 28th August, 1994 approved
acquisition of |
|
| 8
secondhand ships in two phases. In the first phase the following ships were
to be acquired: |
|
|
| 3
Container ships of about 1,200 TEU capacity each. |
|
|
| 1
Bulk Carrier of 60,000/70,000 DWT. |
|
|
| 1
Bulk Carrier of 30,000/40,000 DWT. |
|
|
| In
the second phase these are to be followed by the following ships: |
|
|
| 2
Container ships of about 1,200 TEU capacity. |
|
|
| 1
Edible Oil tanker of about 30,000 DWT. |
|
|
| Out of the above, 3 Container ships have
already been acquired. Process for acquisition of two |
|
| bulk
carriers is being studied. |
|
|
| MANAGEMENT |
|
| Mr. Muhammad Kaleem relinquished charge
of the office of Director (Special Project & |
|
| Planning)
in this Corporation on his transfer as Chairman Port Qasim Authority. |
|
|
|
| ACKNOWLEDGEMENT |
|
| The Board wishes to place on record its
appreciation of the effort and services rendered by the |
|
| officers
and the staff of the Corporation, both ashore and afloat. |
|
|
|
| The Directors also thank the agents,
bankers and auditors for their co-operation and support. |
|
| Our
gratitude is also due to the Director General, Ports & Shipping, Ministry
of Communications and |
|
| the
Government for their guidance and support. |
|
|
|
|
REAR ADMIRAL (RETD.)
JAVAID ALI |
|
| Karachi:
November 11, 1996 |
|
H.I.(M). S.Bt. |
|
|
Chairman |
|
|
|
|
|
| FLEET
AS ON JUNE 30, 1996 |
|
|
|
| S. No. |
Vessel Name |
Type |
Year of |
Dead |
G.R.T. |
N.R.T. |
TEUs |
|
|
|
Built |
Weight |
|
|
|
|
|
in Tons |
|
|
|
| 1.
m.v. Lalazar |
Container |
1985 |
13,346 |
10,282 |
4,664 |
1,022 |
|
| 2.
m.v. Swat |
" |
1983 |
14,355 |
10,917 |
5,758 |
1,013 |
|
| 3.
m.v. Shalamar |
" |
1983 |
14,170 |
10,544 |
5,643 |
932 |
|
| 4.
m.v. Islamabad |
Multipurpose |
1983 |
18,204 |
12,518 |
6,913 |
428 |
|
| 5.
m.v. Khairpur |
" |
1981 |
16,430 |
12,010 |
6,884 |
381 |
|
| 6.
m.v. Sibi |
" |
1981 |
16,436 |
12,010 |
6,884 |
381 |
|
| 7.
m.v. Kaghan |
" |
1981 |
18,050 |
11,940 |
7,180 |
494 |
|
| 8.
m.v. Ayubia |
" |
1981 |
18,050 |
11,940 |
7,180 |
494 |
|
| 9.
m.v. Sargodha |
" |
1980 |
18,242 |
12,438 |
6,920 |
428 |
|
| 10.
m.v. Malakand |
" |
1980 |
18,224 |
12,478 |
6,926 |
428 |
|
| 11.
m.v. Multan |
" |
1980 |
18,257 |
12,436 |
6,917 |
428 |
|
| 12.
m.v. Bolan |
" |
1980 |
18,153 |
12,478 |
6,910 |
428 |
|
| 13.
m.v. Hyderabad |
" |
1980 |
18,257 |
12,436 |
6,917 |
428 |
|
| 14.
m.v. Chitral. |
" |
1980 |
18,144 |
12,478 |
6,910 |
428 |
|
| 15.
m.v. Makran |
" |
1979 |
23,490 |
16,240 |
8,647 |
770 |
|
| 16.
m.v. Ocean Envoy |
" |
1972 |
15,215 |
9,126 |
6,068 |
- |
|
| 17.
m.v. Kaptai |
" |
1968 |
13,330 |
10,216 |
5,576 |
- |
|
|
|
--------- |
--------- |
--------- |
--------- |
|
|
|
|
2,90,353 |
2,02,487 |
1,12,897 |
8,483 |
|
|
========= |
========= |
========= |
========= |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
| We have audited the annexed Balance Sheet
of Pakistan National Shipping Corporation as at |
|
| June
30, 1996 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 Corporation 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 except for the change as described in note 1.3 with
which |
|
| we concur; |
|
|
| (ii)
the expenditure incurred during the year was for the purpose of the
Corporation's |
|
| business; and |
|
|
| (iii)
the business conducted, investments made and the expenditure incurred during
the |
|
| year were in accordance with the objects of
the Corporation; |
|
|
| (c)
as more fully explained in note 29.1, no provision has been made in these
accounts for |
|
| minimum
tax of 0.5 percent of turnover under section 80D of the Income Tax Ordinance, |
|
| 1979
amounting to Rs 93.296 million including Rs 58.220 million for prior years; |
|
|
| (d)
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, except for the effect of the matter referred
to in |
|
| paragraph
(c) above, give a true and fair view of the state of the Corporation's
affairs as at |
|
| June
30, 1996 and of the profit and cash flows for the year then ended; and |
|
|
|
| (e)
in our opinion no zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980. |
|
|
|
|
BALANCE SHEET AS |
|
|
|
|
|
|
|
|
|
Note |
1996 |
1995 |
|
| SHARE
CAPITAL AND RESERVES |
|
(Rupees '000) |
|
|
|
|
| Authorised
Capital |
|
| 200,000,000
(1995: 200,000,000) |
|
|
|
| ordinary
shares of Rs 10 each |
|
|
2,000,000 |
2,000,000 |
|
|
|
========== |
========== |
|
| Issued,
subscribed and paid-up capital |
2 |
1,143,406 |
1,143,406 |
|
| Capital
reserve |
|
3 |
126,843 |
126,843 |
|
|
|
--------- |
--------- |
|
|
|
|
1,270,249 |
1,270,249 |
|
| ACCUMULATED
LOSS |
|
|
(526,487) |
(565,639) |
|
|
|
|
--------- |
--------- |
|
|
|
|
743,762 |
704,610 |
|
| LONG-TERM
LOANS |
|
4 |
1,235,871 |
-- |
|
| LONG-TERM
LIABILITIES |
|
|
1,713 |
2,755 |
|
|
|
|
|
|
| DEFERRED
LIABILITIES |
|
|
|
|
| Retirement
gratuity |
|
5 |
177,212 |
155,526 |
|
|
| CURRENT
LIABILITIES AND PROVISIONS |
|
|
|
|
| Current
portion of: |
|
|
|
| --
long-term loan |
|
4 |
353,106 |
-- |
|
| --
long-term liabilities |
|
1,405 |
2,473 |
|
|
|
| Short-term
running finance utilised under |
|
|
|
| mark-up
arrangement |
|
6 |
-- |
74,196 |
|
|
|
|
|
| Creditors,
provisions and accruals |
|
7 |
830,987 |
677,841 |
|
|
|
|
| Unclaimed
dividends |
|
9,883 |
9,889 |
|
|
--------- |
--------- |
|
|
|
1,195,381 |
764,399 |
|
| CONTINGENCIES |
|
8 |
--------- |
--------- |
|
|
|
3,353,939 |
1,627,290 |
|
|
========== |
========== |
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
|
| AT
JUNE 30, 1996 |
|
|
|
|
Note |
1996 |
1995 |
|
|
|
(Rupees '000) |
|
|
|
|
|
| FIXED
ASSETS - TANGIBLE |
|
9 |
2,163,551 |
598,534 |
|
|
|
10 |
4,682 |
4,682 |
|
| LONG-TERM
INVESTMENTS |
|
11 |
56,166 |
66,878 |
|
| LONG-TERM
LOANS AND ADVANCES |
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
| Stores
and spares |
|
12 |
138,706 |
140,756 |
|
| Freight
receivable |
|
13 |
331,316 |
302,234 |
|
| Agents'
and owners' balances. |
|
14 |
66,209 |
77,533 |
|
| Other
debtors |
|
15 |
82,195 |
95,095 |
|
| Loans
and advances |
|
16 |
35,205 |
29,848 |
|
| Deposits
and prepayments |
|
17 |
20,052 |
19,248 |
|
| Incomplete
voyages |
|
18 |
75,423 |
27,190 |
|
| Income
taxes refundable |
|
19 |
158,456 |
120,892 |
|
| Insurance
claims |
|
20 |
33,480 |
39,276 |
|
| Certificates
of deposit with banks and financial institutions |
3,000 |
3,000 |
|
| Cash
and bank balances |
|
21 |
185,498 |
102,124 |
|
|
--------- |
--------- |
|
|
|
1,129,540 |
957,196 |
|
|
|
--------- |
--------- |
|
|
3,353,939 |
1,627,290 |
|
|
|
========== |
========== |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| For
the year ended June 30, 1996 |
|
|
|
|
|
Note |
1996 |
1995 |
|
|
|
(Rupees '000) |
|
|
|
|
|
| OPERATING
REVENUES |
|
|
|
| Freight
(Net) |
|
|
2,459,110 |
2,020,212 |
|
|
| Chartering
revenues |
|
22 |
4,502,894 |
3,139,348 |
|
|
|
|
|
--------- |
--------- |
|
|
|
|
6,962,004 |
5,159,560 |
|
|
| OPERATING
EXPENSES |
|
|
|
|
|
| Fleet
expenses - direct |
|
23 |
6,625,601 |
5,451,123 |
|
|
|
- indirect |
24 |
30,882 |
41,756 |
|
|
|
|
|
--------- |
--------- |
|
|
|
|
6,656,483 |
5,492,879 |
|
|
| Administration
and general expenses |
25 |
246,513 |
194,604 |
|
|
|
|
--------- |
--------- |
|
|
|
|
|
6,902,996 |
5,687,483 |
|
|
|
|
|
--------- |
--------- |
|
|
| OPERATING
PROFIT/(LOSS) |
|
59,008 |
(527,923) |
|
| INSURANCE
CLAIMS |
|
26 |
34,272 |
5,646 |
|
| OTHER
INCOME |
|
27 |
124,310 |
167,834 |
|
|
|
--------- |
--------- |
|
|
|
217,590 |
(354,443) |
|
| OTHER
EXPENSES |
|
28 |
173,514 |
79,931 |
|
|
|
--------- |
--------- |
|
| PROFIT/(LOSS)
BEFORE TAXATION |
|
44,076 |
(434,374) |
|
| TAXATION |
|
29 |
4,924 |
8,834 |
|
|
--------- |
--------- |
|
| PROFIT/(LOSS)
AFTER TAXATION |
|
39,152 |
(443,208) |
|
| ACCUMULATED
LOSS BROUGHT FORWARD |
|
(565,639) |
(122,431) |
|
|
|
--------- |
--------- |
|
| ACCUMULATED
LOSS CARRIED FORWARD |
|
(526,487) |
(565,639) |
|
|
|
========== |
========== |
|
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
