| BOC Pakistan Limited |
|
|
|
|
|
|
|
|
|
|
|
| Annual
Report 1998 |
|
|
| CONTENTS |
|
|
|
| BOARD
OF DIRECTORS |
|
|
| NOTICE OF ANNUAL GENERAL |
MEETING |
|
|
| THE
YEAR AT A GLANCE |
|
|
| CHAIRMAN'S
STATEMENT |
|
|
| TEN-YEAR
FINANCIAL REVIEW |
|
|
| BUSINESS
LOCATIONS |
|
|
| STATEMENT
OF VALUE ADDED |
|
|
| BUSINESS
DIVISIONS, PRODUCTS AND SERVICES |
|
| DIRECTORS' REPORT |
|
| PATTERN
OF SHAREHOLDINGS |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
|
|
| BALANCE SHEET |
|
|
|
| CASH
FLOW STATEMENT |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
|
|
|
|
| BOARD OF |
|
|
|
| DIRECTORS |
|
|
|
|
|
|
|
| Chairman |
|
| J R RAHIM |
|
|
| Managing
Director |
|
|
| J ANWAR |
|
|
| Directors |
|
|
|
| R S GRANT |
|
|
|
| C G LEON |
|
|
|
| R AHMAD |
|
|
|
| I HUSAIN |
|
|
|
| A U KHAWAJA |
|
|
|
| S QURESHI |
|
|
|
|
|
|
| Secretary |
|
|
|
| M ASLAM |
|
|
|
|
| Bankers |
|
|
|
| BANK
OF AMERICA NT & SA |
|
|
| STANDARD
CHARTERED BANK |
|
|
| ANZ
GRINDLAYS BANK PLC |
|
|
| EMIRATES
BANK INTERNATIONAL PJSC |
|
| CITIBANK NA |
|
|
|
| SOCIETE
GENERALE |
|
|
| DEUTSCHE
BANK AG |
|
|
| FAYSAL
BANK LTD |
|
|
| MASHREQ
BANK PSC |
|
|
| NATIONAL
BANK OF PAKISTAN |
|
|
| MUSLIM
COMMERCIAL BANK LTD |
|
|
| Auditors |
|
|
|
| A
F FERGUSON & CO. |
|
|
| Solicitors |
|
|
|
| SURRIDGE
& BEECHENO |
|
|
| Registered
Office |
|
|
| WEST
WHARF, KARACHI-74000 |
|
|
| A
member of The BOC Group plc, U.K. |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the Fiftieth Annual General Meeting of BOC PAKISTAN |
|
| LIMITED
will be held at Karachi Sheraton Hotel & Towers, Club Road, Karachi on
Tuesday, |
|
| the
26th day of January 1999 at 10.30 a.m. to transact the following business: |
|
|
| 1.
To confirm the Minutes of the 49th Annual General Meeting held on 24 January
1998. |
|
|
| 2.
To receive and consider the Statement of Accounts for the year ended 30
September |
|
| 1998
and Reports of the Directors and Auditors thereon. |
|
|
| 3.
To declare a final dividend of Rs 4.50 per ordinary share, as recommended by
Directors. |
|
|
| 4.
To appoint Auditors and fix their remuneration. |
|
|
| 5.
To elect Directors of the Company for a period of three years from 30 January
1999 |
|
| under
Section 178(1) of the Companies Ordinance, 1984. The number of elected |
|
| Directors
of the Company fixed by the Board of Directors in their meeting held on |
|
| 30
November 1998 is Eight (8). Mr J R Rahim, Mr R S Grant, Mr C G Leon, Dr |
|
| R
Ahmad, Mr I Husain, Mr A U Khawaja, Mr S Qureshi and Mr J Anwar being all |
|
| the
Directors of the Company for the time being, retire in accordance with the
provisions |
|
| of
the said Ordinance. |
|
|
| 6.
Any other business which may legally be transacted at an Annual General
Meeting. |
|
|
| The
Share Transfer Books of the Company will be closed from 13 January to 26
January 1999, |
|
| both
days inclusive. |
|
|
| By
Order of the Board |
|
|
| West Wharf |
|
MUHAMMAD ASLAM |
|
| Karachi-74000 |
|
Secretary |
|
| 30
November 1998 |
|
|
| NOTES: |
|
|
| i)
A member entitled to attend the Annual General Meeting is entitled to appoint
a Proxy to |
|
| attend,
speak and vote in his place at the Meeting. No person shall act as a Proxy
(except |
|
| for
a Corporation) unless he is entitled to be present and vote in his own right.
Instrument |
|
| appointing
Proxy must be deposited at the Registered Office of the Company at least 48 |
|
| hours
before the time of the Meeting. |
|
|
| ii)
Shareholders are requested to notify any change in address immediately. |
|
|
|
| THE
YEAR AT A GLANCE |
|
|
1998 |
1997 |
|
|
(Rupees in thousand) |
|
|
| Sales |
|
1,020,786 |
838,584 |
|
| Profit
before mark-up, interest & tax |
|
340,387 |
245,115 |
|
| Profit
after tax |
|
282,964 |
260,904 |
|
| Paid-up
Capital |
|
181,440 |
181,440 |
|
| Dividend
- payout |
|
108,864 |
108,864 |
|
| - per share |
|
Rs 6.00 |
Rs 6.01 |
|
| - cover |
|
2.60x |
2.40x |
|
|
--------- |
--------- |
|
|
221,798 |
1,125,428 |
|
| Capital
Expenditure |
|
| Capital
Employed at Year End |
|
1,360,742 |
1,218,937 |
|
| Return
on Average Capital Employed |
|
26.40% |
34.50% |
|
| (based
on Profit before mark-up, interest and tax) |
|
|
--------- |
--------- |
|
| Net
Asset Backing at Year End |
|
Rs 42.52 |
Rs 32.93 |
|
| Number
of Permanent Employees at Year End |
|
536 |
551 |
|
|
|
|
|
| CHAIRMAN'S
STATEMENT |
|
|
| The
company faced unprecedented challenges during the period under review. The |
|
| economic
environment in the country which was difficult initially, deteriorated
further |
|
| after
the imposition of economic sanctions after Pakistan's nuclear tests in May
this |
|
| year.
The company's Air Separation Unit (ASU plant) at Lahore had an unfortunate |
|
| accident
in December 1997. This resulted in suspension of production for about |
|
| seven months. |
|
|
| I
am, however, pleased to report that through innovative marketing strategy and |
|
| mobilization
of distribution resources both local and international, the management |
|
| of
your company dealt with these challenges most effectively. Your company's
largest |
|
| investment
in ASU facility to date at Pod Qasim came on stream at the most opportune |
|
| time
and commenced supplies to major customers and to ICl's PTA plant from March |
|
| 1998.
This also enabled your company to meet ASU gases requirement of North |
|
| Region.
The production facility at Lahore was expeditiously restored in July 1998 |
|
| through
movement of Aspen Plant from Hub to Lahore. Your company thus closed |
|
| the
financial year with record sales and profit. I would like to congratulate the
management |
|
| and
all staff and workers for achieving excellent results under such challenging |
|
| circumstances. |
|
|
| The
Government is engaged in negotiating financial assistance with IMF and other |
|
| lending
agencies to revive the economy of the country. Economic sanctions imposed |
|
| on
Pakistan are now being softened. It is hoped that successful conclusion of
these |
|
| measures
will have positive impact on investment in the country. With expected |
|
| improvement
in the economy, your company is well placed to take full advantage |
|
| of
growth opportunities and continue to maintain its market leadership position. |
|
|
| Karachi |
|
J R RAHIM |
|
| 30
November 1998 |
|
Chairman |
|
|
|
| TEN-YEAR
FINANCIAL REVIEW |
|
|
| Operating
Results |
|
1989 |
1990 |
1991 |
1992 |
1993 |
1994 |
1995 |
1996 |
1997 |
1998 |
|
|
Rs 000 |
Rs 000 |
Rs 000 |
Rs 000 |
Rs 000 |
Rs 000 |
Rs 000 |
Rs 000 |
Rs 000 |
Rs 000 |
|
|
| Sales |
|
218,199 |
267,256 |
331,130 |
418,670 |
510,842 |
550,643 |
694,115 |
828,811 |
838,584 |
1,020,786 |
|
| Operating
Profit |
|
39,381 |
52,309 |
70,635 |
104,986 |
135,329 |
148,734 |
208,132 |
258,206 |
251,843 |
300,637 |
|
| Interest
and Mark-up, Net |
|
(1,831) |
(5,819) |
(5,982) |
(2,606) |
2,451 |
13,554 |
21,871 |
20,697 |
19,604 |
(73,407) |
|
|
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
|
| Profit
before Taxation |
|
34,737 |
43,459 |
60,530 |
96,926 |
131,441 |
156,956 |
226,990 |
268,535 |
264,719 |
266,980 |
|
| Taxation |
|
(19,332) |
(21,729) |
(29,293) |
(41,298) |
(51,493) |
(56,636) |
(66,376) |
(62,039) |
(3,815) |
15,984 |
|
|
--------- |
--------- |
--------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
|
| Profit
after Taxation |
|
15,405 |
21,730 |
31,237 |
55,628 |
79,948 |
100,320 |
160,614 |
206,496 |
260,904 |
282,964 |
|
| Dividends |
|
(8,316) |
(9,979) |
(12,701 ) |
(26,611) |
(38,707) |
(48,384) |
(72,576) |
(96,163) |
(108,864) |
(108,864) |
|
| Tax
on Bonus Shares |
|
-- |
-- |
-- |
-- |
-- |
-- |
-- |
(12,096) |
-- |
-- |
|
|
--------- |
--------- |
--------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
|
| Retained
Surplus |
|
7,089 |
11,751 |
18,536 |
29,017 |
41,241 |
51,936 |
88,038 |
98,237 |
152,040 |
174,100 |
|
|
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
|
| Capital
Employed |
|
|
|
|
| Paid-up
Capital |
|
30,240 |
36,288 |
36,288 |
48,384 |
48,384 |
60,480 |
60,480 |
181,440 |
181,440 |
181,440 |
|
| Reserves |
|
76,395 |
82,098 |
100,634 |
117,555 |
158,796 |
198,636 |
286,674 |
263,951 |
415,991 |
590,091 |
|
|
--------- |
--------- |
--------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
|
| Shareholders'
Fund |
|
106,635 |
118,386 |
136,922 |
165,939 |
207,180 |
259,116 |
347,154 |
445,391 |
597,431 |
771,531 |
|
| Deferred
Taxation |
|
-- |
9,900 |
10,000 |
10,200 |
9,700 |
9,600 .... |
|
|
| Long-term
Liabilities & Borrowings |
34,903 |
59,754 |
21,301 |
4,911 |
(64,825) |
(119,085) |
(199,654) |
(245,332) |
621,506 |
589,211 |
|
| (net of cash) |
|
--------- |
--------- |
--------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
|
|
141,538 |
188,040 |
168,223 |
181,050 |
152,055 |
149,631 |
147,500 |
200,059 |
1,218,937 |
1,360,742 |
|
| Represented
by: |
|
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
|
|
|
|
|
| Fixed Assets |
|
99,235 |
140,714 |
142,202 |
162,732 |
162,369 |
168,497 |
171,318 |
337,548 |
1,419,210 |
1,553,683 |
|
| Working
Capital |
|
42,303 |
47,326 |
26,021 |
18,318 |
(10,314) |
(18,866) |
(23,818) |
(137,489) |
(200,273) |
(192,941) |
|
|
--------- |
--------- |
--------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
---------- |
|
|
141,538 |
188,040 |
168,223 |
181,050 |
152,055 |
149,631 |
147,500 |
200,059 |
1,218,937 |
1,360,742 |
|
|
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
|
| Statistics |
|
|
|
|
|
|
| Expenditure
on Fixed Assets |
36,622 |
53,397 |
20,023 |
40,820 |
23,020 |
30,830 |
29,974 |
199,197 |
1,125,428 |
221,798 |
|
| Annual
Depreciation |
|
11,874 |
11,350 |
18,502 |
20,289 |
23,178 |
24,328 |
27,027 |
32,860 |
43,690 |
84,027 |
|
|
|
|
|
| Adjusted
Earnings per share-Rupees |
0.85 |
1.20 |
1.72 |
3.07 |
4.41 |
5.53 |
8.85 |
11.38 |
14.38 |
15.60 |
|
| (Note) |
|
|
|
| Adjusted
Dividend per share--Rupees |
0.46 |
0.55 |
0.70 |
1.47 |
2.13 |
2.67 |
4.00 |
5.30 |
6.00 |
6.00 |
|
| (Note) |
|
|
|
|
| Dividend
Cover--Times |
|
1.85x |
2.18x |
2.46x |
2.09x |
2.07x |
2.07x |
2.21 x |
2.15x |
2.40x |
2.6x |
|
|
|
|
| Adjusted
Net Asset Backing |
|
|
|
| per
share--Rupees (Note) |
|
5.88 |
6.52 |
7.55 |
9.15 |
11.42 |
14.28 |
19.13 |
24.55 |
32.93 |
42.52 |
|
| Return
on average Shareholders' Fund |
|
|
|
| (based
on profit after tax) |
14.90% |
19.30% |
24.50% |
36.7% |
42.9% |
43.0% |
53.0% |
52.1% |
50.0% |
41.3% |
|
| Dividend
paid on average |
|
|
|
| Shareholders'
Fund |
|
8.10% |
8.90% |
9.90% |
17.6% |
20.7% |
20.8% |
23.9% |
24.3% |
20.9% |
15.9% |
|
| Return
on average Capital Employed |
|
|
|
| (based
on profit before mark-up, |
|
|
|
| interest
& tax) |
|
28.10% |
29.90% |
37.30% |
57.0% |
77.4% |
95.1% |
138.1% |
142.6% |
34.5% |
26.4% |
|
|
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
|
| Note:
Figures restated based on bonus issues. |
|
|
|
|
|
| BUSINESS
LOCATIONS |
|
|
|
|
| REGISTERED |
|
| AND
HEAD OFFICE |
Karachi |
P.O. Box 4845, West Wharf |
|
|
Phones: (021) 2313361 (9
lines) |
|
|
Fax: 2312968 |
|
|
| NORTH |
|
| WESTERN REGION |
|
Lahore |
P.O. Box 205, |
|
Oxygen/Nitrogen &
Argon Factory |
|
|
|
Shalamar Link Road, |
|
Acetylene Factory |
|
|
|
Moghalpura |
|
Nitrous Oxide Factory |
|
|
|
Phones: (042) 6824091 (4
lines) |
|
|
|
Fax: 6817573 |
|
|
|
|
| Rawalpindi |
|
Rawalpindi |
267, Saddar Road |
|
Sales Depot |
|
|
|
Phones: (051) 566441,
585670 |
|
|
|
Fax: 585670 |
|
|
|
|
|
Multan |
Opp. Khakwani House, |
|
Sales Depot & |
|
|
Vehari Chowk, Vehari Road |
Oxygen Compressing
Station |
|
|
Phones: (061) 526141,
529820, 529568 |
|
|
|
Faisalabad |
Altaf Ganj Chowk, |
|
Sales Depot & |
|
|
Near Usman Flour Mills, |
|
Oxygen Compressing
Station |
|
|
Jhang Road |
|
|
Phones: (041) 653463,
650564 |
|
|
|
Gujranwala |
Pindi By-Pass, G.T. Road |
|
Sales Depot & |
|
|
Phones: (0431) 254720,
259115 |
Oxygen Compressing
Station |
|
|
|
Wah |
Kabul Road |
|
Acetylene Factory |
|
|
Cantonment |
Phone: (0596) 2477 |
|
|
|
Taxila |
Adjacent to Heavy |
|
Oxygen/Nitrogen Factory |
|
|
Mechanical Complex No. 2 |
|
|
Phones: (051) 9270563 (5
lines) |
|
|
Ext: 383 |
|
|
(0596) 2408 |
|
|
Fax: (0596) 4608 |
|
|
|
Nowshera |
C/o Associated Industries
Ltd. |
Sales Depot |
|
|
Amangarh |
|
|
Phone: (0923) 610559 |
|
|
|
Peshawar |
Jhagra Chowk, G.T. Road |
|
Sales Depot & |
|
|
Phones: (091) 261573 (2
lines) |
Oxygen Compressing
Station |
|
|
| SOUTHERN
REGION |
Karachi |
West Wharf |
|
Oxygen/Nitrogen &
Argon Factory |
|
|
Phones: (021) 2313361 (9
lines) |
Acetylene Factory |
|
|
Fax: 2312968 |
|
Nitrous Oxide Factory |
|
|
Speciality Gases |
|
|
|
Eastern Zone, Port Qasim |
|
Oxygen/Nitrogen &
Argon Factory |
|
|
Phone: (0321) 244485 |
|
Hydrogen Factory |
|
|
Fax: (0321) 4320038 |
|
|
|
Hyderabad |
Kh. Gharib Nawaz Road |
|
Sales Depot |
|
|
C/o Wazir All Industries
Ltd., Hall Road |
Oxygen Compressing
Station |
|
|
Phone: (0221) 880930 |
|
|
|
Sukkur |
Bandani Colony No. 1, |
|
Sales Depot |
|
|
Main Shikarpur Road |
|
|
Phone: (071) 614791 |
|
|
|
Quetta |
C-8, Kabir Bldg., M.A.
Jinnah Road |
Sales Depot |
|
|
Phone: (081) 824637 |
|
|
|
Eissa Khan Street, |
|
Oxygen Compressing
Station |
|
|
Off Sirki Road |
|
|
|
|
|
Hub |
65/67, Mauza Pathara, |
|
Oxygen/Nitrogen &
Argon Factory |
|
|
RCD Highway, Hub Chowki |
|
Hydrogen Factory |
|
|
Phones: (0202) 32294
& 32295 |
|
|
| MANUFACTURING |
|
Karachi |
West Wharf |
|
Electrode Factory |
|
|
Phones: (021) 2313361 (9
lines) |
|
|
|
| STATEMENT
OF VALUE ADDED |
|
| BY
BOC PAKISTAN DURING 1998 |
|
|
| The
statement below shows the amount of wealth generated by the company employees |
|
| and
its assets during the year and the way this wealth has been distributed: |
|
|
|
1998 |
|
1997 |
|
|
|
Rs 000 |
% |
Rs 000 |
% |
|
| Wealth
Generated |
|
|
| Total
revenue, net of sales tax |
1,078,269 |
|
873,124 |
|
| Bought-in-materials
& services |
(471,889) |
|
(390,692) |
|
|
---------- |
---------- |
---------- |
|
|
606,380 |
100 |
482,432 |
100 |
|
|
========== |
========== |
========== |
|
| Wealth
Distributed |
|
| To Employees |
|
| Salaries,
benefits & related costs |
144,807 |
24 |
125 271 |
26 |
|
| To Government |
|
|
| Income
Tax on Profit, Workers' |
|
| Funds,
Import Duties (exclusive of capital |
|
| items)
and un-adjustable Sales Tax |
19,206 |
3 |
50,571 |
10 |
|
|
|
|
|
|
| To
Providers of Capital |
|
|
|
|
|
| Dividends
to shareholders |
|
108,864 |
18 |
108,864 |
23 |
|
|
| Mark-up/Interest
Expense on |
|
| borrowed funds |
|
75,376 |
12 |
1,996 |
- |
|
|
| Retained
in the Business |
|
|
| For
replacement of fixed assets: |
|
| depreciation |
|
84,027 |
14 |
43,690 |
9 |
|
|
| To
provide for growth: |
|
| retained
profit |
|
174,100 |
29 |
152,040 |
32 |
|
|
---------- |
---------- |
---------- |
---------- |
|
|
606,380 |
100 |
482,432 |
100 |
|
|
========== |
========== |
========== |
========== |
|
|
|
| BUSINESS
DIVISIONS, PRODUCTS AND SERVICES |
|
|
|
|
GASES |
|
| GASES |
|
HEALTH CARE |
|
WELDING |
|
| Industrial
Gases |
Medical Gases |
|
Gas Welding & Cutting |
|
|
|
Compressed Medical Oxygen |
|
Regulators |
|
| Compressed
Oxygen |
Liquid Medical Oxygen |
|
Cutting Torches |
|
| Liquid Oxygen |
|
Nitrous Oxide &
Entonox |
|
| Aviation
Oxygen |
|
Welding Torches |
|
| Compressed
Nitrogen |
|
Cutting Machines |
|
| Liquid
Nitrogen |
Medical Equipment |
|
Gas Control Equipment |
|
| Pure Argon |
|
Safety Equipment |
|
| Compressed Air |
|
Anaesthesia Equipment |
|
Flame Cleaning |
|
| Dissolved
Acetylene |
Vaporisers |
|
Thermic Lancing |
|
| Hydrogen |
|
Ventilators |
|
Gas Welding Rods |
|
| Industrial
Pipelines |
Anaesthesia Systems |
|
Fluxes |
|
|
Patient Monitoring
Equipment |
|
|
Invasive &
Non-Invasive Blood Pressure |
|
| Speciality
Gases |
ECG - 2,5, or 10 leads |
|
Electric Welding |
|
|
CO2 (Endtidal) |
|
| High
Purity Gases |
Temperature |
|
Welding Machines |
|
| Research
Grade Gases |
Pulse Oximetry |
|
Automatic |
|
| Gaseous
Chemicals |
Agent Monitoring |
|
Semi-automatic |
|
| Calibration
Mixtures |
Paediatric Equipment |
|
Manual |
|
| Argon Mixtures |
|
Incubators & Infant
Warmers |
|
Welding Consumables |
|
| Welding
Gas Mixtures |
Photo Therapy |
|
Welding Electrodes |
|
| Sterilization
Gases |
CTG/Fetal Monitors |
|
MIG Welding Wires |
|
| Helium |
|
Resuscitation |
|
TIG Welding Wires |
|
| FREONŽ
Refrigerants |
ICU Equipment |
|
Accessories |
|
| FREONŽ
Solvents |
Ventilators &
Humidifiers |
|
| SUVAŽ
Refrigerants |
Defibrillators |
|
| FORMACEL
Blowing Agents |
Syringe & Infusion
Pumps |
|
| DYMEL
Propellants |
Suction Machines |
|
|
Diagnostic Equipment |
|
|
ETT & ECG Machines |
|
|
Cardiac & GP
Ultrasound Systems |
|
|
Stress Echo |
|
|
Medical Gases Pipeline |
|
|
Design, Installation
& Service |
|
|
Vaporizer Service and
Calibration Centre |
|
|
| NATURE OF |
|
| BUSINESS |
|
The main business areas
of the Company are: |
|
|
--Industrial Gases |
|
|
-- Speciality Gases |
|
|
-- Health Care--Medical
Gases and Equipment |
|
|
-- Welding Products |
|
| < |
