| KOHINOOR POWER COMPANY LIMITED |
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|
|
|
|
|
|
|
| ANNUAL
REPORT 1997 |
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|
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| CONTENTS |
|
| Company
Information |
|
| Notice
of Annual General Meeting |
|
| Directors'
Report |
|
| Auditors'
Report to the Members |
|
| Balance
Sheet |
|
| Profit
and Loss Account |
|
| Cash Flow Statement |
|
| Notes
to the Accounts |
|
| Pattern
of Holding of Shares |
|
|
|
|
| COMPANY
INFORMATION |
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|
|
|
| BOARD
OF DIRECTORS |
|
|
|
|
| Mr.
M. Naseem Saigol |
|
Chairman/Chief Executive |
|
| Mr.
M. Azam Saigol |
|
| Mr.
Shahid Sethi |
|
| Mr.
Imran Iqbal |
|
| Mr.
Muhammad Ilyas Bajwa |
|
| Mr.
Muhammad Asif Bajwa |
|
| Mr.
Saeed Mian Ansari |
|
|
|
|
| Company
Secretary |
|
| Sheikh
Muhammad Shakeel, ACA |
|
|
| Auditors |
|
|
| Manzoor
Hussain Mir & Co., |
|
| Chartered
Accountants |
|
|
|
|
| Bankers |
|
|
| Askari
Commercial Bank Limited |
|
| Faysal
Bank Limited |
|
| Habib
Bank Limited |
|
| Muslim
Commercial Bank Limited |
|
| National
Development Finance Corporation |
|
| National
Bank of Pakistan |
|
| Union
Bank Limited |
|
|
| Registered
Office |
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| 06-Egerton
Road, |
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| Lahore. |
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|
|
|
| Works |
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| Kohinoor
Nagar, |
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| Faisalabad. |
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| NOTICE
OF ANNUAL GENERAL MEETING |
|
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| Notice
is hereby given that the Sixth Annual General Meeting of Shareholders of
Kohinoor |
|
| Power
Company Limited will be held on Monday 29th December, 1997 at 10:00 A.M. |
|
| at
06-Egerton Road, Lahore the Registered Office of the Company to transact the
following |
|
| business:- |
|
|
| 1.
To confirm the minutes of Fifth Annual General Meeting held on 30 December
1996. |
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|
|
| 2.
To receive and adopt the Annual Audited Accounts for the year ended June 30,
1997 |
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| alongwith
Directors' and Auditors' Reports thereon. |
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|
|
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| 3.
To appoint Auditors to hold office till the conclusion of the next Annual
General |
|
| Meeting
and to fix their remuneration. |
|
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| 4.
Any other business with the permission of the Chair. |
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|
| Notes: |
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|
| 1.
The Share Transfer Books of the Company will remain closed from 30 December |
|
| 1997
to 05 January 1998 (both days inclusive). |
|
|
| 2.
A member entitled to attend and vote at this Meeting may appoint an another
member ~ |
|
| as
proxy. Proxies in order to be effective, must be received at the Registered
Office of ~ |
|
| the
Company not later than forty-eight hours before the time of the meeting and
must |
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| be
duly stamped, signed and witnessed. |
|
|
| 3.
Members are requested to notify the Company change in their addresses, if
any. |
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| DIRECTORS'
REPORT |
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| Your
Directors are pleased to present the Sixth Annual Report alongwith audited
accounts for the year ended ~ |
|
| June
30, 1997. |
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|
| Performance |
|
|
|
|
| Your
Company operates a 15MW power generating plant which has performed well
during the year under |
|
| review
86.217 million units (kWh) were produced for sale to the associated company
viz Kohinoor Industries |
|
| Limited.
The operating and financial results of the Company for the year under review
are summarised |
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| below: |
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|
|
|
1997 |
1996 |
|
|
|
|
(Rupees in thousand) |
|
|
|
|
| Profit
for the year |
|
26,219 |
44,340 |
|
| Prior
years adjustments |
|
- |
(11,859) |
|
|
|
---------- |
---------- |
|
|
|
26,219 |
32,481 |
|
| Unappropriated
profit brought forward |
|
255 |
774 |
|
|
|
---------- |
---------- |
|
| Profit
available for appropriations |
|
26,474 |
33,255 |
|
|
|
|
|
| Appropriation: |
|
|
|
| Transferred
to General Reserve |
|
26,000 |
33,000 |
|
|
|
---------- |
---------- |
|
| Unappropriated
profit |
|
474 |
255 |
|
|
|
========== |
========== |
|
|
|
|
| Major
reason for decrease in profit from Rs. 32,255 thousand to Rs. 26,219
thousands is abnormal increase in |
|
| price
of furnace oil, overhauling and replacement of certain parts of engines to
achieve greater efficiency. |
|
|
| Earning
Per Share |
|
|
|
|
| In
the light of financial results for the year under review the earning per
share comes to Rs. 2.18 (1996: Rs. 3.70). |
|
|
|
|
| Auditors |
|
|
|
|
|
| The
present auditors Messrs Manzoor Hussain Mir & Company, Chartered
Accountants, retire and being |
|
| eligible,
offer themselves for re-appointment. |
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|
|
|
| Pattern
of Shareholding |
|
|
|
|
| A
statement showing the pattern of shares holding as on June 30, 1997 is
appended herewith. |
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|
|
|
| Directors |
|
|
|
| During
the period since last Annual General Meeting Mr. Imran Iqbal has been
appointed as Director in |
|
| place
of Ch. Abdul Ghafoor. |
|
|
|
|
| We
wish to record deep appreciations of the valuable services rendered by the
outgoing Director. |
|
| Acknowledgment |
|
| Your
Directors are pleased to record their appreciation of the services rendered
by the employees of the |
|
| Company
and hope that the same spirit of devotion and co-operation will continue in
future. |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of Kohinoor Power Company Limited as
at June 30, 1997 |
|
| 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 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 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
company's affairs |
|
| as
at June 30, 1997 and of the profit and cash flow statement for the year then
ended; and |
|
|
| (d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980. |
|
|
|
(MANZOOR HUSSAIN MIR
& CO) |
|
| Lahore:
Dec 6, 1997 |
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET As at June 30, 1997 |
|
|
|
|
1997 |
1996 |
|
|
Note |
Rupees |
Rupees |
|
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
|
|
|
| SHARE
CAPITAL |
|
(3) |
120,000,000 |
120,000,000 |
|
|
|
|
|
| RESERVES |
|
(4) |
203,000,000 |
177,000,000 |
|
| UN-APPROPRIATED
PROFIT |
|
|
474,426 |
255,035 |
|
|
|
|
---------- |
---------- |
|
|
|
|
323,474,426 |
297,255,035 |
|
| LONG
TERM LOANS |
|
(5) |
124,447,772 |
93,536,427 |
|
|
|
|
|
| LIABILITIES
AGAINST ASSETS |
|
|
|
| SUBJECT
TO FINANCE LEASE |
|
(6) |
28,876,274 |
45,596,746 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
|
|
---------- |
---------- |
|
| SHORT
TERM LOANS |
|
(7) |
27,755,424 |
57,036,170 |
|
|
|
|
| CURRENT
PORTION OF LONG |
|
|
| TERM
LIABILITIES |
|
(8) |
96,200,008 |
55,049,937 |
|
|
|
|
|
| CREDITORS,
PROVISIONS AND |
|
|
|
| ACCRUED
LIABILITIES |
|
(9) |
21,531,833 |
16,829,634 |
|
|
|
|
---------- |
---------- |
|
|
|
|
145,487,265 |
128,915,741 |
|
|
|
|
|
| CONTINGENCIES
AND COMMITMENTS |
|
(10) |
- |
- |
|
|
|
|
---------- |
---------- |
|
|
|
|
622,285,737 |
565,303,949 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes (1) to (26) form an integral part of these financial
statements. |
|
|
|
|
|
| FIXED
ASSETS - TANGIBLE |
|
|
|
|
|
| OPERATING
FIXED ASSETS |
|
( 11 ) |
229,116,435 |
202,292,146 |
|
| CAPITAL
WORK IN PROGRESS |
|
|
- |
8,032,000 |
|
| ASSETS
SUBJECT TO FINANCE LEASE |
|
(12) |
56,100,000 |
62,333,333 |
|
|
|
|
|
| INVESTMENTS |
|
(13) |
46,800,000 |
46,800,000 |
|
|
|
|
|
| DEFERRED
COST |
|
(14) |
- |
534,179 |
|
|
|
|
|
| LONG
TERM DEPOSITS |
|
|
|
|
|
|
6,800,000 |
23,307,144 |
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
|
|
---------- |
---------- |
|
| STORES
AND SPARES |
|
(15) |
30,991,677 |
28,831,293 |
|
| TRADE
DEBT - Considered good |
|
(16) |
229,723,329 |
144,452,244 |
|
|
|
|
|
| ADVANCES,
PREPAYMENTS |
|
|
|
| AND
RECEIVABLES |
|
(17) |
22,448,573 |
2,471,765 |
|
| CASH
AND BANK BALANCES |
|
(18) |
305,723 |
46,249,845 |
|
|
|
|
---------- |
---------- |
|
|
|
|
283,469,302 |
222,005,147 |
|
|
|
|
---------- |
---------- |
|
|
|
|
|
622,285,737 |
565,303,949 |
|
|
|
|
========== |
========== |
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1997 |
|
|
|
|
|
1997 |
1996 |
|
|
|
Note |
Rupees |
Rupees |
|
| SALES |
|
19 |
273,911,843 |
243,750,407 |
|
| COST
OF SALES |
|
20 |
198,562,984 |
141,511,707 |
|
|
|
|
---------- |
---------- |
|
| GROSS
PROFIT |
|
|
75,348,859 |
102,238,700 |
|
|
|
|
| OPERATING
EXPENSES |
|
|
|
|
|
|
---------- |
---------- |
|
| Administrative
and General |
|
21 |
2,098,013 |
2,872,172 |
|
| Financial |
|
22 |
46,232,907 |
54,548,744 |
|
|
|
|
---------- |
---------- |
|
|
|
|
48,330,920 |
57,420,916 |
|
|
|
|
---------- |
---------- |
|
| OPERATING
PROFIT |
|
|
27,017,939 |
44,817,784 |
|
| OTHER
INCOME |
|
|
581,420 |
1,856,070 |
|
|
|
|
---------- |
---------- |
|
|
|
|
27,599,359 |
46,673,854 |
|
|
|
|
| WORKERS
PARTICIPATION FUND |
|
1,379,968 |
2,333,693 |
|
|
|
|
---------- |
---------- |
|
| PROFIT
BEFORE PRIOR YEARS' ADJUSTMENTS |
|
26,219,391 |
44,340,161 |
|
| PRIOR
YEARS' ADJUSTMENTS |
|
- |
11,858,752 |
|
| UN-APPROPRIATED
PROFIT BROUGHT FORWARD |
|
255,035 |
773,626 |
|
|
|
|
|
---------- |
---------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATION |
|
26,474,426 |
33,255,035 |
|
| APPROPRIATION: |
|
|
|
|
| Transferred
to General Reserve |
|
26,000,000 |
33,000,000 |
|
|
|
|
---------- |
---------- |
|
| UN-APPROPRIATED
PROFIT CARRIED TO BALANCE SHEET |
474,426 |
255,035 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes (1) to (26) form an integral part of these financial
statements. |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED JUNE 30, 1997 |
|
|
|
1997 |
1996 |
|
|
|
Rupees |
Rupees |
|
|
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
|
|
|
|
| Net
profit before taxation |
|
26,219,391 |
44,340,161 |
|
| Adjustments
for: |
|
|
|
| Depreciation |
|
29,758,301 |
27,588,019 |
|
| Amortization
of deferred cost |
|
534,179 |
560,568 |
|
| Financial
charges |
|
46,232,907 |
54,548,744 |
|
| Profit
on sale of assets |
|
- |
(1,514,742) |
|
|
|
---------- |
---------- |
|
| Operating
profit before working capital changes |
102,744,778 |
125,522,750 |
|
|
|
---------- |
---------- |
|
| (Increase)/Decrease
in stores and spares |
|
(2,160,384) |
(12,489,618) |
|
| (Increase)/Decrease
in trade debt |
|
(85,271,085) |
42,739,593 |
|
| (Increase)/Decrease
in Advances, prepayments and receivables |
(19,976,808) |
(2,172,126) |
|
| Increase/(Decrease)
in creditors, accrued and.9ther liabilities |
(1,866,157) |
3,816,261 |
|
|
|
---------- |
---------- |
|
|
|
(109,274,434) |
31,894,110 |
|
|
|
---------- |
---------- |
|
| Cash
generated from operations |
|
(6,529,656) |
157,416,860 |
|
|
|
---------- |
---------- |
|
| Financial
charges paid |
|
|
(39,664,551) |
(61,893,034) |
|
| Prior
years expenses |
|
|
- |
(11,858,752) |
|
|
|
---------- |
---------- |
|
|
|
(39,664,551) |
(73,751,786) |
|
|
|
---------- |
---------- |
|
| NET
CASH FROM OPERATING ACTIVITIES |
|
(46,194,207) |
83,665,074 |
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
---------- |
---------- |
|
| Fixed
capital expenditure |
|
(42,317,257) |
(28,225,375) |
|
| Proceeds
from sale of fixed assets |
|
- |
68,000,000 |
|
| Long
term deposits |
|
|
16,507,144 |
(5,400,000) |
|
|
|
|
|
---------- |
---------- |
|
| Net
cash used in investing activities |
|
(25,810,113) |
34,374,625 |
|
| CASH
FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
---------- |
---------- |
|
| Short
term loans |
|
|
(29,280,746) |
(7,963,830) |
|
| LPO |
|
|
|
108,727,000 |
- |
|
| Repayment
of suppliers' credit |
|
|
(41,573,322) |
(55,761,402)} |
|
| Repayment
of lease finance |
|
|
(11,812,734) |
(8,926,639) |
|
|
|
---------- |
---------- |
|
| Net
cash generated/(used) in financial activities |
26,060,198 |
(72,651,871) |
|
|
|
|
| Net
increase/(decrease) in cash |
|
(45,944,122) |
45,387,828 |
|
| Cash
and bank balance as at July 1, |
|
46,249,845 |
862,017 |
|
|
|
---------- |
---------- |
|
| Cash
and bank balance as at June 30, |
|
305,723 |
46,249,845 |
|
|
|
========== |
========== |
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 1997 |
|
|
|
| 1.
STATUS AND NATURE OF BUSINESS |
|
|
| Kohinoor
Power Company Limited was incorporated in Pakistan on December 08, |
|
| 1991
as a Private Limited Company and subsequently converted into Public Limited |
|
| Company
on May 10, 1992 and its shares are quoted on stock Exchanges. The principal |
|
| activity
of the company is to generate and sell Electric Power. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
| 2.1
Accounting convention |
|
|
|
|
| These
accounts have been prepared on the basis of historical cost convention. |
|
|
| 2.2
Staff Retirement Benefits |
|
|
| The
company Operates a contributory Provident Fund for all its permanent |
|
| employees
and contributions based on salaries & wages are made monthly to |
|
| cover
the obligations. |
|
|
| 2.3
Taxation |
|
|
| The
profits of the company being from electricity generation are exempt from |
|
| tax
under clause 176 of the 2nd Schedule to the Income Tax Ordinance, 1979. |
|
|
| 2.4
Foreign Currency Translation |
|
|
|
|
| Foreign
liabilities have been translated in Pak Rupees at the rate fixed with State |
|
| Bank
of Pakistan. |
|
|
|
|
|
| 2.5
Contingencies and Commitments |
|
|
|
|
| These
are accounted for as and when these become due. |
|
|
|
|
|
|
|
| 2.6
Fixed Assets |
|
|
|
|
|
|
| Operating
assets are stated at cost less depreciation. Capital work in progress is |
|
| stated
at cost. Depreciation is calculated so as to write off the cost of fixed |
|
| assets,
except lease hold land, on a reducing balance basis using normal rates |
|
| currently
applicable for tax purposes. A full year's depreciation is charged in the |
|
| year
of acquisition. However, depreciation on additions to Plant & Machinery
is |
|
| charged
only for working period. No depreciation is charged in the year of |
|
| disposal. |
|
|
|
|
| Normal
repair and maintenance expenses are charged to income as and when |
|
| incurred
while major renewals and improvements are capitalised. |
|
|
|
|
|
| 2.
7. Assets Subject to Finance Lease |
|
|
| Assets
under finance lease are stated at lower of present value of minimum lease |
|
| payments
under the agreement or the fair value of assets. The aggregate amount |
|
| of
obligations relating to these assets are accounted for at net present value
of ~ |
|
| liabilities.
Depreciation on these assets is charged in line with normal depreciation |
|
| policy
adopted for assets owned by the company. |
|
|
| 2.8
Stores and Spares |
|
|
|
|
|
| These
are valued at moving average cost, except stores in transit which are |
|
| stated
at actual cost. |
|
|
|
|
| 2.9
Revenue Recognition |
|
|
|
| Energy
sales are recognised on the basis of meter readings recorded on continuous |
|
| monthly
basis. |
|
|
|
|
|
|
1997 |
1996 |
|
| 3.
SHARE CAPITAL |
|
Rupees |
Rupees |
|
| Authorised |
|
|
|
|
| 12,000,000
ordinary shares of Rs. 10/- each |
|
120,000,000 |
120,000,000 |
|
| Issued,
subscribed and paid up |
|
|
========== |
========== |
|
| 12,000,000
ordinary shares of Rs. 10/- each |
|
|
| fully paid |
|
|
|
|
|
|
|
| 8,000,000
ordinary shares for cash |
|
80,000,000 |
80,000,000 |
|
| 4,000,000
shares as bonus shares |
|
40,000,000 |
40,000,000 |
|
|
|
---------- |
---------- |
|
|
|
120,000,000 |
120,000,000 |
|
|
|
|
========== |
========== |
|
| 4.
RESERVES |
|
|
|
|
|
|
|
|
| REVENUE
- GENERAL |
|
|
|
|
|
|
|
|
| Balance
from previous year |
|
137,000,000 |
104,000,000 |
|
| Transferred
from Profit & Loss Account |
|
26,000,000 |
33,000,000 |
|
|
|
---------- |
---------- |
|
|
|
163,000,000 |
137,000,000 |
|
|
|
|
|
|
| CAPITAL
RESERVE |
|
|
|
| Premium
on issue of shares |
|
40,000,000 |
40,000,000 |
|
| For
proposed bonus shares: |
|
---------- |
---------- |
|
| Balance
from previous year |
|
- |
20,000,000 |
|
| Less:
Bonus shares issued |
|
- |
(20,000,000) |
|
|
|
---------- |
---------- |
|
|
|
- |
- |
|
|
|
---------- |
---------- |
|
|
|
203,000,000 |
177,000,000 |
|
|
|
========== |
========== |
|
|
|
|
|
|
|
1997 |
1996 |
|
|
|
|
|
Rupees |
Rupees |
|
| 5.
LONG TERM LOANS |
|
|
|
|
|
|
| SUPPLIERS'
CREDITS |
|
|
|
| Tomen
Corporation |
|
|
|
| Loan - I |
(5.1) |
|
20,788,080 |
41,576,160 |
|
| Loan - II |
(5.2) |
|
72,748,347 |
93,533,589 |
|
| Faysal Bank Limited (LPO) |
(5.3) |
|
108,727,427 |
- |
|
|
|
---------- |
---------- |
|
|
|
202,263,427 |
135,109,749 |
|
|
