| Kohinoor Power Company Limited |
|
|
|
|
|
|
| Annual
Report 1998 |
|
|
| CONTENTS |
|
|
| Company
Information |
|
| Notice
of Annual General Meeting |
|
| Directors'
Report |
|
| Auditors'
Report to the Member |
|
| Pattern
of Holding of Shares |
|
| Balance
Sheet |
|
| Profit
and Loss Account |
|
| Cash
Flow Statement |
|
| Notes
to the Accounts |
|
|
|
| COMPANY
INFORMATION |
|
|
| 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 |
|
| Syed
Arshad A'la |
|
(ICP Nominee) |
|
|
| COMPANY
SECRETARY |
|
| Sheikh
Muhammad Shakeel, ACA |
|
|
| AUDITORS |
|
| M/s
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 |
|
| 06
- Egerton Road, Lahore. |
|
| Tel:
6306131 (5 Lines) |
|
|
| WORKS |
|
| Kohinoor
Nagar, Faisalabad. |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the Seventh Annual General Meeting of the Shareholders
of |
|
| KOHINOOR
POWER COMPANY LIMITED will be held on Thursday December 31, 1998 at |
|
| 09:30
a.m. at. Associated House, Mezzanine Floor, 07- Egerton Road, Lahore to
transact the |
|
| following
business:- |
|
|
| 1.
To confirm the minutes of Extraordinary General Meeting held on September 30,
1998. |
|
|
| 2.
To receive and adopt the Annual Audited Accounts for the year ended June 30,
1998 |
|
| along
with Directors' and Auditors' Reports thereon. |
|
|
| 3.
To approve payment of Cash Dividend @ 7.5% (Re. 0.75 per share) as
recommended by |
|
| the Board. |
|
|
|
| 4.
To appoint Auditors to hold office till the conclusion of the next Annual
General Meeting |
|
| and
to fix their remuneration. |
|
|
|
|
| 5.
Any other business with the permission of the Chair. |
|
|
|
|
By order of the Board |
|
|
|
|
|
|
| Lahore |
|
|
SHEIKH MUHAMMAD SHAKEEL |
|
| December
07, 1998 |
|
Company Secretary |
|
|
| Notes: |
|
|
| 1.
The Share Transfer Books of the Company will remain closed from December 31,
1998 |
|
| to
January 06, 1999 (both days inclusive). Transfers received in order at
Registered |
|
| Office
of the Company upto the close of business on December 30, 1998 will be
treated |
|
| in
time for the payment of dividend to the Transferees |
|
|
|
|
| 2.
A member entitled to attend and vote at this Meeting may appoint 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 be
duly |
|
| stamped,
singed and witnessed. |
|
|
| 3.
Members are requested to notify the company change in their addresses, if any
and to file |
|
| with
the Company their declaration (if any) for non-deduction of Zakat. |
|
|
|
| DIRECTORS'
REPORT |
|
|
| Your
Directors are pleased to present the Seventh Annual Report along with audited
accounts for |
|
| the
year ended June 30, 1998. |
|
|
| Financial
Results |
|
| Your
Company operates a 15 MW power generating plant. During the year under review
87.931 |
|
| million
units (kWh) were produced for sale to our customer viz. Kohinoor Industries
Limited. |
|
| The
operating and financial results of the Company for the year under review are
summarised |
|
| below: |
|
|
|
|
|
1997 |
1998 |
|
|
|
|
|
(Rupees in thousand) |
|
|
|
|
|
|
|
| Gross
Profit |
|
89,402 |
75,343 |
|
| Administrative
& General Expenses |
|
1,377 |
2,092 |
|
|
|
|
---------- |
---------- |
|
| Operating
Profit |
|
88,025 |
73,251 |
|
| Financial
Charges |
|
54,709 |
46,233 |
|
|
|
|
---------- |
---------- |
|
|
|
|
33,316 |
27,018 |
|
| Other
Income |
|
840 |
581 |
|
|
|
|
---------- |
---------- |
|
|
|
|
34,156 |
27,599 |
|
| Workers
profit participation fund |
|
1,707 |
1,380 |
|
|
|
|
---------- |
---------- |
|
| Profit
for the year |
|
32,449 |
26,219 |
|
| Unappropriated
profit brought forward |
|
474 |
255 |
|
|
|
|
---------- |
---------- |
|
| Profit
available for appropriation |
|
32,923 |
26,474 |
|
|
|
|
|
|
| Appropriations |
|
|
|
| Cash
dividend @ 7.5% |
|
|
|
| (Re
0.75 per share) |
|
9,000 |
- |
|
| Transferred
to General Reserves |
|
23,000 |
26,000 |
|
|
|
---------- |
---------- |
|
|
|
32,000 |
26,000 |
|
|
|
---------- |
---------- |
|
| Unappropriated
profit |
|
923 |
474 |
|
|
|
========== |
========== |
|
|
| Your
Company has launched a cost reduction programme. As a result administration
and general |
|
| expenses
and certain expenses charged to cost of sales have reduced inspite of
inflationary trend |
|
| in
the country. |
|
|
| Earning
Per Share: |
|
| In
the light of financial results for the year under review the earning per
share comes to Rs 2.70 |
|
| (1997:
Rs. 2.18). |
|
|
| Future
Prospects |
|
| Your
directors are studying a proposal to utilise the surplus production capacity
presently |
|
| available.
This proposal envisages shifting of one generating set of 5 MW from
Faisalabad to |
|
| Chunian
for supplying power to two associated companies namely Azam Textiles Mills
Limited |
|
| and
Saritow Spinning Mills Limited. This will enable us to operate at full
capacity. Thus our |
|
| profit
will be increased through this exercise. |
|
|
| Dividend |
|
| Your
directors recommend a cash dividend ~ 7.5% (Re 0.75 per share) for the year
under review. |
|
|
| Auditors
and their Report |
|
| The
present auditors Messrs Manzoor Hussain Mir & Company, Chartered
Accountants, retire |
|
| and
being eligible, offer themselves for re-appointment. |
|
|
| No
provision has been made for diminution in the value of investments in view of
their long term |
|
| nature
and the fact that prices quoted on stock exchanges these days are abnormally
depressed. |
|
| The
investee company is earning profits and the break-up value of its shares as
on June 30, 1998 |
|
| is
Rs. 18.24 which is greater than the cost of this investment. |
|
|
| No
provision has been made for income tax charged by taxation authority on the
interest accrued |
|
| to
the Company during the years ended 1994-95 and 1996-97. All profits and gains
derived by the |
|
| Company
are exempt under clause 176 of second schedule to the Income Tax Ordinance,
1979. |
|
| We
have filed appeals before CIT (Appeals) and a constitutional writ before
Lahore High Court |
|
| against
taxability of interest. Therefore, provision has not been taken into account.
Similarly, the |
|
| Company
has filed appeal against penalty imposed under Corporate Assets Tax Law where
the |
|
| matter
is subjudice. |
|
|
| Directors |
|
| During
the period since last Annual General Meeting, Syed Arshad A'la has been
elected as |
|
| Director
in the extra-ordinary general meeting of the company held on September 30,
1998. We |
|
| welcome
Syed Arshad A'la on the Board of Directors of your Company and wish to record
deep |
|
| appreciation
of the valuable services rendered by the outgoing Director, Mr. Saeed Mian
Ansari. |
|
|
| Pattern
of Shareholding |
|
| A
statement showing the pattern of shareholding as on June 30, 1998 is appended
herewith. |
|
|
| 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. |
|
|
|
|
FOR AND ON BEHALF OF THE BOARD |
|
|
|
|
|
|
| Lahore |
|
|
|
|
| December
07, 1998 |
|
CHIEF EXECUTIVE |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of KOHINOOR POWER COMPANY LIMITED as |
|
| at
June 30, 1998 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: |
|
|
| (i)
No provision is made in the accounts for persisting loss of Rs. 26.866
million in value of |
|
| shares
of Union Bank Limited indicated at note - 13. |
|
|
| (ii)
No provision is made for taxes amounting to Rs. 15.59 million appearing at |
|
| notes-
10.3 & 22. |
|
|
| Subject
to above we report that: |
|
|
| (a)
in our opinion, proper books of accounts 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 the company's affairs as at |
|
| June
30, 1998 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. |
|
|
| Lahore |
|
|
(MANZOOR HUSSAIN MIR & co.) |
|
| December
07, 1998. |
|
Chartered Accountants |
|
|
|
| PATTERN
OF HOLDING OF SHARES |
|
| HELD
BY THE SHAREHOLDERS AS AT JUNE 30, 1998 |
|
|
|
|
Shareholding |
|
| No. of |
|
|
|
Total |
|
| Shareholders |
From |
|
To |
|
Shares Held |
|
|
| 99 |
1 |
- |
100 |
Shares |
4,890 |
|
| 218 |
101 |
- |
500 |
" |
57,505 |
|
| 555 |
501 |
- |
1000 |
" |
407,470 |
|
| 408 |
1001 |
- |
5000 |
" |
842,520 |
|
| 73 |
5001 |
- |
10000 |
" |
520,900 |
|
| 24 |
10001 |
- |
15000 |
" |
307,920 |
|
| 4 |
15001 |
- |
20000 |
" |
67,590 |
|
| 5 |
20001 |
- |
25000 |
" |
105,435 |
|
| 6 |
25001 |
- |
30000 |
" |
165,850 |
|
| 5 |
30001 |
- |
35000 |
" |
160,470 |
|
| 4 |
35001 |
- |
40000 |
" |
149,050 |
|
| 1 |
40001 |
- |
45000 |
" |
42,000 |
|
| 2 |
45001 |
- |
50000 |
" |
95,500 |
|
| 1 |
55001 |
- |
60000 |
" |
59,500 |
|
| 2 |
60001 |
- |
65000 |
" |
121,400 |
|
| 1 |
90001 |
- |
95000 |
" |
90,840 |
|
| 2 |
100001 |
- |
105000 |
" |
206,800 |
|
| 1 |
145001 |
- |
150000 |
" |
150,000 |
|
| 1 |
170001 |
- |
175000 |
" |
173,225 |
|
| 1 |
220001 |
- |
225000 |
" |
222,060 |
|
| 1 |
240001 |
- |
245000 |
" |
244,950 |
|
| 1 |
255001 |
- |
260000 |
" |
259,980 |
|
| 1 |
450001 |
- |
455000 |
" |
454,145 |
|
| 1 |
495001 |
- |
500000 |
" |
498,000 |
|
| 1 |
555001 |
- |
560000 |
" |
556,000 |
|
| 1 |
560001 |
- |
565000 |
" |
563,820 |
|
| 1 |
2695001 |
- |
2700000 |
" |
2,700,000 |
|
| 1 |
2770001 |
- |
2775000 |
" |
2,772,180 |
|
| ---------- |
|
|
|
|
---------- |
|
| 1,421 |
|
12,000,000 |
|
| ========== |
|
========== |
|
|
| Note:
The slabs applicable have not been shown. |
|
|
| Categories
Of Shareholders |
Number |
Shares Held |
Percentage |
|
|
|
|
|
| Individuals |
|
1375 |
2860745 |
23.84 |
|
| Investment
Companies |
|
6 |
730340 |
6.09 |
|
| Insurance
Companies |
|
1 |
563820 |
4.70 |
|
| Joint
Stock Companies |
|
15 |
5794905 |
48.29 |
|
| Financial
Institutions |
|
4 |
650510 |
5.42 |
|
| Foreign
Companies |
|
6 |
1127980 |
9.40 |
|
| Leasing
& Modaraba Companies |
14 |
271700 |
2.26 |
|
|
|
---------- |
---------- |
---------- |
|
|
|
1421 |
12000000 |
100.00 |
|
|
|
========== |
========== |
========== |
|
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1998 |
|
|
|
|
Note |
1998 |
1997 |
|
|
|
|
Rupees |
Rupees |
|
| SHARE
CAPITAL AND RESERVES |
|
|
| SHARE
CAPITAL |
|
|
(3) |
120,000,000 |
120,000,000 |
|
| RESERVES |
|
|
|
(4) |
226,000,000 |
203,000,000 |
|
| UN-APPROPRIATED
PROFIT |
|
|
|
923,416 |
474,426 |
|
|
|
|
---------- |
---------- |
|
|
|
|
346,923,416 |
323,474,426 |
|
|
|
|
|
|
| LONG
TERM LOANS |
|
|
(5) |
67,420,197 |
124,447,772 |
|
| LIABILITIES
AGAINST ASSETS SUBJECT |
|
|
|
|
| TO
FINANCE LEASE |
|
|
(6) |
23,805,479 |
28,876,274 |
|
| CURRENT
LIABILITIES |
|
|
|
|
|
| SHORT
TERM LOANS |
|
|
(7) |
77,665,024 |
27,755,424 |
|
| CURRENT
PORTION OF LONG TERM |
|
|
|
| LIABILITIES |
|
|
(8) |
115,192,461 |
96,200,008 |
|
| CREDITORS,
PROVISIONS AND ACCRUED |
|
|
|
|
| LIABILITIES |
|
|
(9) |
24,810,891 |
21,531,833 |
|
| PROPOSED
DIVIDEND |
|
|
|
9,000,000 |
- |
|
|
|
|
|
|
---------- |
---------- |
|
|
|
|
226,668,376 |
145,487,265 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
(10) |
- |
- |
|
|
|
|
---------- |
---------- |
|
|
|
|
664,817,468 |
622,285,737 |
|
|
|
|
|
========== |
========== |
|
|
|
|
| OPERATING
ASSETS-TANGIBLE |
|
|
|
|
|
| OWN |
|
(11) |
206,968,135 |
229,116,435 |
|
| ASSETS
SUBJECT TO FINANCE LEASE |
|
(12) |
50,490,000 |
56,100,000 |
|
|
|
|
|
|
| INVESTMENT |
|
|
(13) |
46,800,000 |
46,800,000 |
|
| LONG
TERM DEPOSITS |
|
|
|
6,800,000 |
6,800,000 |
|
| CURRENT
ASSETS |
|
|
|
|
|
| STORES
AND SPARES |
|
|
(14) |
36,365,706 |
30,991,677 |
|
| TRADE DEBTS |
|
|
|
(15) |
294,312,142 |
229,723,329 |
|
| ADVANCES,
DEPOSITS AND |
|
|
|
|
|
| PREPAYMENTS |
|
|
(16) |
22,392,062 |
22,448,573 |
|
| CASH
AND BANK BALANCES |
|
|
(17) |
689,423 |
305,723 |
|
|
|
|
|
|
---------- |
---------- |
|
|
|
|
353,759,333 |
283,469,302 |
|
|
|
|
---------- |
---------- |
|
|
|
|
|
664,817,468 |
622,285,737 |
|
|
|
|
|
========== |
========== |
|
| The
annexed notes (1)to (25) form an integral part of these financial statements. |
|
|
|
GENERAL MANAGER FINANCE |
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
|
|
|
(MANZOOR HUSSAIN MIR & co.) |
|
|
|
|
CHARTERED ACCOUNTANTS |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
|
|
Note |
1998 |
1997 |
|
|
|
|
Rupees |
Rupees |
|
|
|
|
| SALES |
|
|
(18) |
275,582,298 |
273,911,843 |
|
| COST
OF SALES |
|
(19) |
186,179,972 |
198,569,282 |
|
|
|
|
|
---------- |
---------- |
|
| GROSS
PROFIT |
|
|
89,402,326 |
75,342,561 |
|
| OPERATING
EXPENSES |
|
|
|
|
| Administrative
& General |
|
(20) |
1,376,637 |
2,091,715 |
|
| Financial |
|
(21) |
54,709,012 |
46,232,907 |
|
|
|
|
---------- |
---------- |
|
|
|
|
56,085,649 |
48,324,622 |
|
|
|
|
---------- |
---------- |
|
| OPERATING
PROFIT |
|
|
33,316,677 |
27,017,939 |
|
| OTHER
INCOME |
|
|
840,155 |
581,420 |
|
|
|
|
|
---------- |
---------- |
|
|
|
|
|
34,156,832 |
27,599,359 |
|
| WORKERS
PROFIT PARTICIPATION FUND |
|
|
1,707,842 |
1,379,968 |
|
|
|
|
|
---------- |
---------- |
|
| PROFIT
BEFORE TAXATION |
|
|
32,448,990 |
26,219,391 |
|
| UN-APPROPRIATED
PROFIT BROUGHT FORWARD |
|
474,426 |
255,035 |
|
|
|
|
---------- |
---------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATION |
|
|
32,923,416 |
26,474,426 |
|
|
|
|
|
|
|
| APPROPRIATIONS: |
|
|
|
| Proposed
Dividend @ 7.5% |
|
9,000,000 |
- |
|
| Transferred
to general reserve |
|
23,000,000 |
26,000,000 |
|
|
|
---------- |
---------- |
|
|
|
32,000,000 |
26,000,000 |
|
|
|
---------- |
---------- |
|
| UN-APPROPRIATED
PROFIT CARRIED TO BALANCE SHEET |
923,416 |
474,426 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes (1) to (25) form an integral part of these financial
statements. |
|
|
|
GENERAL MANAGER FINANCE |
|
CHIEF EXECUTIVE |
|
DIRECTOR |
|
|
| Auditors'
Report Annexed |
|
(MANZOOR HUSSAIN MIR & co.) |
|
| Lahore |
|
|
CHARTERED ACCOUNTANTS |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
|
|
|
|
|
|
|
1998 |
1997 |
|
|
|
|
|
Rupees |
Rupees |
|
| CASH
FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
| Net
profit before taxation |
|
32,448,990 |
26,219,391 |
|
| Adjustments
for: |
|
|
|
| Depreciation |
|
28,565,178 |
29,758,301 |
|
| Amortisation
of deferred cost |
|
- |
534,179 |
|
| Financial
charges |
|
54,709,012 |
46,232,907 |
|
|
|
---------- |
---------- |
|
| Operating
profit before working capital changes |
115,723,180 |
102,744,778 |
|
|
|
---------- |
---------- |
|
| (Increase)/Decrease
in stores and spares |
|
(5,374,029) |
(2,160,384) |
|
| (Increase)/Decrease
in trade debt |
|
(64,588,815) |
(85,271,083) |
|
| (Increase)/Decrease
in advances, prepayments and receivables |
56,512 |
(19,976,809) |
|
| (Increase)/Decrease
in creditors, accrued and other liabilities |
(1,594,164 |
(1,866,158) |
|
|
|
---------- |
---------- |
|
|
|
71,500,497 |
(109,274,434) |
|
|
|
---------- |
---------- |
|
| Cash
generated from operations |
|
44,222,682 |
(6,529,656) |
|
| Financial
charges paid |
|
(49,835,788) |
(39,664,551) |
|
|
|
---------- |
---------- |
|
| NET
CASH FROM OPERATING ACTIVITIES |
|
(5,613,104) |
(46,194,207) |
|
|
|
|
|
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
| Fixed
capital expenditure |
|
(806,878) |
(42,317,257) |
|
| Long
term advances and deposits |
|
- |
16,507,144 |
|
|
|
---------- |
---------- |
|
| Net
cash used in investing activities |
|
(806,878) |
(25,810,113) |
|
|
|
|
| CASH
FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
| Short
term loans |
|
49,909,600 |
(29,280,747) |
|
| LPO |
|
- |
108,727,000 |
|
| Repayment
of supplier's credit |
|
(41,573,322) |
(41,573,322) |
|
| Repayment
of lease finance |
|
(1,532,595) |
(11,812,734) |
|
|
|
---------- |
---------- |
|
| Net
cash generated/(used) in financing activities |
6,803,683 |
26,060,197 |
|
|
|
---------- |
---------- |
|
| Net
increase/(decrease) in cash |
|
383,701 |
(45,944,123) |
|
| Cash
and bank balance as at July 1, |
|
305,722 |
46,249,845 |
|
|
|
---------- |
---------- |
|
| Cash
and bank balance as at June 30, |
|
689,423 |
305,722 |
|
|
|
========== |
========== |
|
|
|
|
