| Lucky Cement Limited |
|
|
|
|
|
|
|
|
| Annual
Report 1998 |
|
|
|
| CONTENTS |
|
|
| Company
Information |
|
| Notice
of Meeting |
|
| Directors'
Report |
|
| Pattern
of Shareholding |
|
| Auditors'
Report |
|
| Balance
Sheet |
|
| Profit
& Loss Account |
|
| Statement
of Changes in Financial Position (Cash Flow) |
|
| Notes
to the Accounts |
|
| Lucky
Powetech Limited |
|
| Statement
and Report under Section 237 of the Companies Ordinance, 1984 |
|
|
|
| COMPANY
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
|
Abdul Razzak Tabba
(Chairman/Chief Executive) |
|
|
|
Muhammad Yunus Tabba |
|
|
|
Razi-ur-Rahman Khan
(Nominee - NIT) |
|
|
|
Haji Abdul Razzak |
|
|
|
Martyn S. Wells |
|
|
|
Muhammad Sohail Tabba |
|
|
|
Muhammad Ali Tabba |
|
|
|
Imran Yunus Tabba |
|
|
| EXECUTIVE
DIRECTOR |
|
Abdur Razzaq Thaplawala |
|
|
| COMPANY
SECRETARY & |
|
Muhammad Abid Ganatra |
|
| SR.
MANAGER FINANCE |
|
ACA, ACMA, ACIS |
|
|
| AUDITORS |
|
M. Yousuf Adil Saleem
& Co., |
|
|
|
|
Chartered Accountants |
|
|
| BANKERS |
|
Citibank N.A. |
|
|
|
Metropolitan Bank Limited |
|
|
|
Muslim Commercial Bank
Limited |
|
|
|
Soneri Bank Limited |
|
|
| REGISTERED
OFFICE/FACTORY |
|
Pezu, District Lakki
Marwat |
|
|
|
N.W.F.P. |
|
|
| HEAD OFFICE |
|
|
6-A Muhammad Ali Housing
Society, |
|
|
|
A. Aziz Hashim Tabba
Street, |
|
|
|
Karachi -75350. |
|
|
|
UAN (021) 111-786-555 |
|
|
| SALES
OFFICES |
|
|
| 211
Latif Plaza, 2nd Floor, |
Aptma House, |
|
| Ferozpur
Road, Ichhra, Lahore. |
Jamrud Road, Peshawar. |
|
| UAN
(042) 111-786-555 |
|
UAN (091) 111-786-555 |
|
|
|
|
| 106,
Metro Plaza, |
|
Saddar Bazar, Bannu Road, |
|
| Qasim
Road, Multan. |
|
Near Main Flying Coach
Adda, |
|
| UAN
(061) 111-786-555 |
|
D.I. Khan, |
|
|
|
|
UAN (0961) 111-786-555 |
|
| 3rd
Floor, Kulsum Plaza, |
|
| 42
Blue Area, Islamabad. |
|
| UAN
(051) 111-786-555 |
|
|
| SHARES
DEPARTMENT |
|
404, 4th Floor, Trade
Tower |
|
|
|
Abdullah Haroon Road,
Karachi. |
|
|
|
Tel. No. 5685930-5687839 |
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|
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| NOTICE
OF 5TH ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the 5th Annual General Meeting of the members of Lucky
Cement |
|
| Limited
will be held on Wednesday, the 30th December, 1998 at 2:00 p.m. at the
registered |
|
| office
of the Company at factory premises Pezu, District Lakki Marwat, N.W.F.P. to
transact |
|
| the
following business: |
|
|
| 1.
To confirm the minutes of 4th Annual General Meeting held on 2nd February,
1998. |
|
|
| 2.
To receive, consider and adopt the audited accounts for the year ended June
30, 1998 |
|
| together
with the Directors' and Auditors' report thereon. |
|
|
| 3.
To appoint Auditors and fix their remuneration for the year 1998-99. The
present Auditors, |
|
| Messrs
M. Yousuf Adil & Co., Chartered Accountants, retire and being eligible,
offer |
|
| themselves
for reappointment. |
|
|
| 4.
To transact any other business with the permission of the Chair. |
|
|
|
|
By Order of the Board. |
|
|
|
|
|
|
|
|
|
Muhammad Abid Ganatra |
|
| Karachi:
7th December, 1998 |
|
Company Secretary |
|
|
| Notes: |
|
|
| 1.
The Share Transfer Books of the Company will be closed from 24th December,
1998 to |
|
| 30th
December, 1998 (both days inclusive) for the purpose of 5th Annual General
Meeting. |
|
|
| 2.
A member entitled to attend and vote may appoint another member as his/her
proxy to |
|
| attend
and vote instead of him/her. Proxies must be received at the Registered
Office of |
|
| the
Company not less than 48 hours before the time of holding the meeting. |
|
|
| 3.
The members are requested to notify change in their address, if any, to the
Company's |
|
| shares
department at 404, 4th Floor, Trade Tower, Abdullah Haroon Road, Karachi. |
|
|
|
| DIRECTORS'
REPORI |
|
|
| It
is a pleasure to present this Fifth Annual Report and the Annual Audited
Accounts for the year |
|
| ended
on 30th June, 1998 with auditors' report thereon. |
|
|
| DEMAND,
SUPPLY SITUATION |
|
| The
cement industry in Pakistan continues to pass through a critical period of
its history. During the |
|
| financial
year from July 1997 to June 1998, the demand remained stagnant and the
supplies increased |
|
| further
with commencement of production by some new plants and expansions during the
last |
|
| quarter
of the financial year. At present the country has a production capacity of
over 16 million tons |
|
| per
year against the demand of not more than 9 million tons. This works out to a
consumption of 75 |
|
| Kg.
per head of the population. This rate of consumption is one of the lowest
even among the |
|
| developing
and under developed countries of the world. There is, therefore, substantial
room for |
|
| increase
in the consumption if the economic conditions of the country improve and we
attain sizable |
|
| economic
grow[h in coming years. |
|
|
| TAX BURDEN |
|
| Apart
from the gap between demand and supply, the industry in the country is
burdened with one of |
|
| the
highest. rate of direct taxes even as compared to countries in south and
south east Asia. Presently, |
|
| tile
cement is chargeable to an excise duty of 40% on retail price which includes
the transportation |
|
| costs,
local taxes and distributor's margin. The actual incidence of the excise duty
is worked out to |
|
| be
more than 45% of the ex-factory price. During the year under report, the NWFP
Provincial |
|
| Government
increased the excise duty on lime stone and clay by 100% and 300%
respectively. The |
|
| increase
in exchange? rate and the recent increase in the rate of Sales Tax from 12.5%
to 15% has |
|
| further
increased the cost of inputs like spare parts, refractory bricks and paper
bags. It is time for |
|
| the
government to come to rescue the industry and reduce its tax burden. |
|
|
| EXPORTS |
|
| The
development of exports of cement from the country can reduce the gap between
demand and |
|
| supply
to some extent. The exports however, will be possible if the government
extends helping hand |
|
| to
the industry by increasing export rebate, allowing freight subsidiary to the
units located in the |
|
| north,
allowing export rebate & excise duty exemption on exports by !and route
and create an |
|
| infrastructure
at Karachi Port suitable for economical handling, storage and loading of
export |
|
| consignments. |
|
|
| PRICES |
|
| There
was wide fluctuations of prices of cement in the local market during the
year. Due to unhealthy |
|
| competition
among the manufacturers, the cement was selling at a retail price of less
than |
|
| Rs
140.00 per bag during some months of the year under review and in first
quarter of the current |
|
| year.
With excise duty of Rs. 56.00 per bag i.e. 40% of the retail price and
transportation and other |
|
| costs,
the retention price worked out to as low as Rs. 75.00 per bag. This did not
permit the |
|
| manufactures
to get even a cash break even Fortunately, the prices have stabilized
recently which |
|
| gives
a ray of hope for future. |
|
|
| PRODUCTION |
|
| As
reported last year, both the lines of your plant were in operation during the
year. The two lines |
|
| were
however operated intermittently due to lack of demand and following
production was achieved. |
|
|
| Clinker |
|
|
526,184 Tons |
|
| Cement |
|
|
555,781 Tons |
|
|
| OPERATING
RESULTS |
|
| Inspite
of lower capacity utilization and wide fluctuation in selling prices, the
company managed to |
|
| earn
an operating profit of Rs. 8.9 million before charging financial expenses of
Rs. 123.78 million. |
|
| The
year, therefore closed with a pre-tax loss of Rs. 114 million. With a
stability in selling prices, it |
|
| is
hoped that the current year will close with better results. |
|
|
| YEAR
2000 PROBLEMS IN COMPUTER SYSTEMS |
|
| Your
company has taken appropriate steps to take care of year 2000 problems in
computer systems |
|
| and
it is hoped that the systems will be ready to operate in year 2000
environment latest by |
|
| 30th
June, 1999. |
|
|
| The
auditors, M. Yusuf Adil Saleem & Co. Chartered Accountants retire and
being eligible offer |
|
| themselves
for reappointment. |
|
|
| PATTERN
OF SHAREHOLDING |
|
| The
pattern of shareholding as on 30th June 1998 is annexed to this report. |
|
|
| SUBSIDIARY |
|
| The
audited accounts of the Lucky Powertech Limited, the company's wholly owned
subsidiary, for |
|
| the
year ended 30th June, 1998 are annexed to this report. |
|
|
| ACKNOWLEDGEMENT |
|
| Your
directors acknowledge with appreciation, the efforts of company's managers,
technicians and |
|
| workers
and the support extended by the company's bankers, leasing companies, dealers
and stockists. |
|
|
|
|
By Order of the Board |
|
|
|
|
|
|
|
|
|
ABDUL RAZZAK TABBA |
|
| 7th
December, 1998 |
|
Chairman & Chief Executive |
|
|
|
| PATTERN
OF SHAREHOLDING AS AT JUNE 30, 1998 |
|
|
|
| NUMBER OF |
|
SHAREHOLDING |
|
TOTAL SHARES |
|
| SHAREHOLDERS |
FROM |
|
TO |
HELD |
|
|
|
|
| 460 |
1 |
- |
100 |
46,000 |
|
| 35178 |
101 |
- |
500 |
17,385,000 |
|
| 346 |
501 |
- |
1000 |
289,300 |
|
| 395 |
1001 |
- |
5000 |
1,211,000 |
|
| 191 |
5001 |
- |
10000 |
1,718,000 |
|
| 48 |
10001 |
- |
15000 |
621,300 |
|
| 42 |
15001 |
- |
20000 |
785,000 |
|
| 30 |
20001 |
- |
25000 |
730,250 |
|
| 19 |
25001 |
- |
30000 |
554,100 |
|
| 3 |
30001 |
- |
35000 |
99,000 |
|
| 8 |
35001 |
- |
40000 |
307,800 |
|
| 1 |
40001 |
- |
45000 |
45,000 |
|
| 7 |
45001 |
- |
50000 |
347,000 |
|
| 2 |
50001 |
- |
55000 |
102,300 |
|
| 3 |
55001 |
- |
60000 |
172,500 |
|
| 2 |
60001 |
- |
65000 |
129,900 |
|
| 7 |
65001 |
- |
70000 |
287,900 |
|
| 7 |
70001 |
- |
75000 |
525,000 |
|
| 3 |
75001 |
- |
80000 |
235,100 |
|
| 2 |
80001 |
- |
85000 |
163,700 |
|
| 2 |
90001 |
- |
95000 |
183,900 |
|
| 7 |
95001 |
- |
100000 |
696,700 |
|
| 1 |
115001 |
- |
120000 |
119,000 |
|
| 1 |
125001 |
- |
130000 |
127,000 |
|
| 2 |
145001 |
- |
150000 |
295,400 |
|
| 1 |
175001 |
- |
180000 |
177,100 |
|
| 3 |
195001 |
- |
200000 |
600,000 |
|
| 1 |
225001 |
- |
230000 |
228,900 |
|
| 2 |
245001 |
- |
250000 |
500,000 |
|
| 2 |
265001 |
- |
270000 |
837,000 |
|
| 1 |
310001 |
- |
315000 |
313,000 |
|
| 3 |
395001 |
- |
400000 |
1,200,000 |
|
| 1 |
460001 |
- |
465000 |
460,300 |
|
| 1 |
480001 |
- |
485000 |
482,800 |
|
| 3 |
495001 |
- |
500000 |
1,500,000 |
|
| 1 |
535001 |
- |
540000 |
536,700 |
|
| 1 |
580001 |
- |
585000 |
582,900 |
|
| 1 |
720001 |
- |
725000 |
720,500 |
|
|
| 1 |
745001 |
- |
750000 |
746,600 |
|
| 1 |
815001 |
- |
820000 |
815,500 |
|
| 1 |
895001 |
- |
900000 |
896,000 |
|
| 1 |
955001 |
- |
960000 |
958,300 |
|
| 1 |
995001 |
- |
1000000 |
1,000,000 |
|
| 1 |
1070001 |
- |
1075000 |
1,073,000 |
|
| 1 |
1300001 |
- |
1305000 |
1,302,500 |
|
| 1 |
1340001 |
- |
1345000 |
1,343,000 |
|
| 3 |
1345001 |
- |
1350000 |
4,045,200 |
|
| 1 |
1425001 |
- |
1430000 |
1,430,000 |
|
| 1 |
1960001 |
- |
1965000 |
1,961,800 |
|
| 1 |
2065001 |
- |
2070000 |
2,070,000 |
|
| 1 |
2270001 |
- |
2275000 |
2,272,720 |
|
|
| 2 |
2495001 |
- |
2500000 |
5,000,000 |
|
| 2 |
2545001 |
- |
2550000 |
5,100,000 |
|
| 2 |
3045001 |
- |
3050000 |
6,100,000 |
|
|
| 1 |
3295001 |
- |
3300000 |
3,299,200 |
|
| 1 |
3995001 |
- |
4000000 |
4,000,000 |
|
| 1 |
4495001 |
- |
4500000 |
4,500,000 |
|
|
| 1 |
4980001 |
- |
4985000 |
4,983,300 |
|
| 2 |
4995001 |
- |
5000000 |
10,000,000 |
|
| 1 |
6415001 |
- |
6420000 |
6,418,800 |
|
| 1 |
6645001 |
- |
6650000 |
6,649,000 |
|
| 1 |
6695001 |
- |
6700000 |
6,700,000 |
|
| 1 |
8330001 |
- |
8335000 |
8,333,350 |
|
| 1 |
14250001 |
- |
14255000 |
14,253,600 |
|
| 1 |
19680001 |
- |
19685000 |
19,682,500 |
|
| 2 |
21210001 |
- |
21215000 |
42,424,240 |
|
| 1 |
42420001 |
- |
42425000 |
42,424,240 |
|
|
| ---------- |
|
|
---------- |
|
|
| 36824 |
|
|
|
245,000,000 |
|
| ========== |
|
|
========== |
|
|
|
|
|
|
|
|
|
|
|
|
| S. NO. |
Categories |
|
Number of |
Total |
Percentage |
|
|
Shareholders |
|
Share Holders |
Shares Held |
|
|
|
|
|
|
|
| 1. |
Individuals |
|
36751 |
82,105,420 |
33.51 |
|
| 2. |
Investment Companies |
|
24 |
101,625,180 |
41.48 |
|
| 3. |
Insurance Companies |
|
5 |
1,471,900 |
0.60 |
|
| 4. |
Joint Stock Companies |
|
20 |
27,514,500 |
11.23 |
|
| 5. |
Financial Institutions |
|
9 |
24,848,900 |
10.14 |
|
| 6. |
Modaraba Companies |
|
9 |
822,800 |
0.34 |
|
| 7. |
Others |
|
5 |
192,500 |
0.08 |
|
| 8. |
Central Depository Co. |
|
1 |
6,418,800 |
2.62 |
|
|
---------- |
---------- |
---------- |
|
|
|
36824 |
245,000,000 |
100.00 |
|
|
========== |
========== |
========== |
|
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of Lucky Cement Limited as at June 30,
1998 and |
|
| related
profit and loss account and the statement of changes in financial position
(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 and profit and loss account and the statement of changes in
financial position |
|
| (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
loss and the |
|
| changes
in financial position for the year then ended; and |
|
|
| d.
in our opinion, no zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980. |
|
|
|
|
|
|
M.YOUSUF ADIL SALEEM & CO., |
|
| Karachi:
7th December, 1998 |
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1998 |
|
|
|
Note |
1998 |
1997 |
|
|
|
|
Amount in "000" |
|
|
| SHARE
CAPITAL AND RESERVE |
|
|
|
| Authorised
capital |
|
|
| 300,000,000
Ordinary shares |
|
| of
Rs. 10/= each |
|
|
3,000,000 |
3,000,000 |
|
|
========== |
========== |
|
| Issued,
subscribed and paid-up capital |
|
|
| 245,000,000
Ordinary shares of Rs. 10/= each |
|
| fully
paid in cash |
|
|
2,450,000 |
2,450,000 |
|
|
| Capital
reserve |
|
| Share
premium |
|
|
990,000 |
990,000 |
|
| Accumulated
loss |
|
|
(145,761) |
(26,580) |
|
|
|
|
---------- |
---------- |
|
|
|
|
3,294,239 |
3,413,420 |
|
| LONG
TERM LOANS |
|
3 |
517,901 |
603,000 |
|
| LIABILITIES
AGAINST ASSETS SUBJECT |
|
|
|
|
| TO
FINANCE LEASE |
|
4 |
106,709 |
101,139 |
|
|
|
|
|
| DEFERRED
LIABILITIES |
|
5 |
124,589 |
68,707 |
|
| LONG
TERM DEPOSITS |
|
6 |
19,234 |
24,767 |
|
| CURRENT
LIABILITIES |
|
|
|
|
| Short
term finance |
|
|
7 |
221,156 |
135,127 |
|
| Current
portion of long term liabilities |
8 |
114,529 |
12,946 |
|
| Creditors,
accrued and other liabilities |
9 |
178,603 |
260,468 |
|
| Provision
for taxation |
|
|
|
7,000 |
2,000 |
|
|
|
---------- |
---------- |
|
|
|
|
521,288 |
410,541 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
10 |
- |
- |
|
|
|
|
|
|
---------- |
---------- |
|
|
|
|
|
4,583,960 |
4,621,574 |
|
|
|
|
|
========== |
========== |
|
|
| FIXED
ASSETS - TANGIBLE |
|
|
| Operating
assets |
|
11 |
3,886,494 |
3,674,541 |
|
| Capital
work-in-progress |
|
12 |
17,805 |
317,766 |
|
|
|
---------- |
---------- |
|
|
|
|
3,904,299 |
3,992,307 |
|
|
|
|
| LONG
TERM INVESTMENT |
|
13 |
200,000 |
200,000 |
|
|
|
|
|
| LONG
TERM DEPOSITS AND |
|
|
|
| DEFERRED
COSTS |
|
14 |
53,663 |
63,427 |
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
|
|
| Stores
and spares |
|
15 |
114,451 |
131,815 |
|
| Stock
in trade |
|
16 |
63,125 |
34,278 |
|
| Trade
debtors |
|
|
- |
37 |
|
| Advances,
deposits, prepayments and |
|
|
|
| other
receivables |
|
17 |
233,283 |
154,720 |
|
| Cash
and bank balances |
|
18 |
15,139 |
44,990 |
|
|
---------- |
---------- |
|
|
|
|
425,998 |
365,840 |
|
|
---------- |
---------- |
|
|
|
4,583,960 |
4,621,574 |
|
|
========== |
========== |
|
| The
Annexed notes from 1 to 30 form an integral part of these accounts. |
|
|
|
|
|
|
Razi-ur-Rahman Khan |
|
Abdul Razzak Tabba |
|
|
Director |
|
Chief Executive |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
|
|
Note |
1998 |
January 01 to |
|
|
|
|
June 30,1997 |
|
|
|
Amount in "000" |
|
|
|
|
| Sales |
|
19 |
1,010,006 |
393,002 |
|
| Cost
of sales |
|
20 |
943,705 |
311,366 |
|
|
---------- |
---------- |
|
| Gross
profit |
66,301 |
81,636 |
|
|
| Operating
expenses |
|
|
| Administrative |
|
21 |
46,779 |
31,338 |
|
| Selling
and distribution |
|
22 |
10,551 |
4,607 |
|
|
|
---------- |
---------- |
|
|
|
|
57,330 |
35,945 |
|
|
|
---------- |
---------- |
|
| Operating
profit |
|
|
|
8,971 |
45,691 |
|
| Other income |
|
23 |
629 |
278 |
|
|
|
---------- |
---------- |
|
|
|
9,600 |
45,969 |
|
| Financial
charges |
|
24 |
123,781 |
70,549 |
|
|
---------- |
---------- |
|
| Loss
before taxation |
|
|
(114,181) |
(24,580) |
|
|
|
|
|
|
| Provision
for taxation |
|
|
(5,000) |
(2,000) |
|
|
|
|
---------- |
---------- |
|
| Net
loss after taxation |
|
|
(119,181) |
(26,580) |
|
|
| Accumulated
loss brought forward |
|
(26,580) |
- |
|
|
|
|
---------- |
---------- |
|
| Accumulated
loss carried forward |
|
(145,761) |
(26,580) |
|
|
========== |
========== |
|
|
| The
annexed notes from 1 to 30 form an integral part of these accounts. |
|
|
|
Razi-ur-Rahman Khan |
|
|
Abdul Razzak Tabba |
|
|
Director |
|
|
Chief Executive |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 1998 |
|
|
|
|
|
1998 |
1997 |
|
