| The Premier Sugar Mills & Distillery Company Limited |
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| Annual
Report 1998 |
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| CONTENTS |
|
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| BOARD
OF DIRECTORS |
|
|
| TEN
YEARS' REVIEW |
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
| DIRECTORS'
REPORT |
|
|
| AUDITORS'
REPORT |
|
|
| BALANCE
SHEET |
|
|
| PROFIT
AND LOSS ACCOUNT |
|
|
| CASH
FLOW STATEMENT |
|
|
| NOTES
TO THE ACCOUNTS |
|
|
| PATTERNS
OF HOLDINGS OF THE SHARES |
|
|
|
|
|
| BOARD
OF DIRECTORS |
|
|
| CHAIRPERSON |
|
|
BEGUM ZARI SARFARAZ |
|
| CHIEF
EXECUTIVE |
|
KHAN ABBAS SARFARAZ |
|
| DIRECTORS |
|
|
KHAN AZlZ SARFARAZ |
|
|
|
|
BEGUM LAILA SARFARAZ |
|
|
|
|
MS. ZARMINE SARFARAZ |
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|
BEGUM MEHMOODA SALIM KHAN |
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|
ABDUL QADAR KHATTAK |
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|
|
|
MUHAMMAD RAFIQ KHAN |
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|
|
|
ISKANDER M. KHAN |
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|
|
|
| SECRETARY/CONTROLLER
FINANCE |
MALIK MOHAMMAD ASLAM,
FCMA |
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|
| AUDITORS |
|
|
MESSRS HAMEED CHAUDHRI
& CO., |
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|
CHARTERED ACCOUNTANTS |
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|
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| REGISTERED
OFFICE |
|
MARDAN (N.W.F.P) |
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|
PHONES: 62051 - 62052 |
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GRAMS: "SUGAR"
MARDAN. |
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|
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| FACTORY |
|
MARDAN. |
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|
|
| TEN
YEARS' REVIEW |
|
|
|
CANE |
|
BEET |
|
| --------------------------------------------------------------------------------------- |
|
| YEAR |
CANE |
|
SUGAR |
BEET |
|
SUGAR |
|
|
CRUSHED |
RECOVERY |
PRODUCED |
SLICED |
RECOVERY |
PRODUCED |
|
| --------------------------------------------------------------------------------------- |
|
|
M. Tons |
|
M. Tons |
M. Tons |
|
M. Tons |
|
| --------------------------------------------------------------------------------------- |
|
| 1989 |
522,214.79 |
9.22 |
48,169.00 |
145,130.99 |
9.00 |
13,057.50 |
|
| 1990 |
263,578.98 |
9.11 |
24,011.00 |
140,908.00 |
7.50 |
10,571.00 |
|
| 1991 |
244,577.45 |
8.20 |
20,052.30 |
125,087.64 |
8.05 |
10,070.40 |
|
| 1992 |
284,432.43 |
8.62 |
24,510.00 |
149,498.69 |
8.96 |
13,400.00 |
|
| 1993 |
228,906.00 |
8.42 |
19,280.50 |
119,016.00 |
8.61 |
10,248.00 |
|
| 1994 |
107,783.00 |
9.02 |
9,720.00 |
103,708.00 |
8.44 |
8,751.50 |
|
| 1995 |
107,489.44 |
9.32 |
10,019.00 |
80,452.95 |
9.14 |
7,354.00 |
|
| 1996 |
76,269.70 |
8.30 |
6,330.50 |
106,549.00 |
9.35 |
9,961.00 |
|
| 1997 |
157,117.04 |
8.01 |
12,584.50 |
96,508.81 |
8.60 |
8303.00 |
|
| 1998 |
204,543.70 |
8.35 |
17078.30 |
55772.68 |
7.60 |
4238.50 |
|
|
|
| NOTICE
OF MEETING |
|
|
| NOTICE
IS HEREBY GIVEN that 53rd Annual General Meeting of the Shareholders of |
|
| The
Premier Sugar Mills & Distillery Company Ltd. Mardan will be held on 27th
March, |
|
| 1999
at 3:00 P.M at the Registered Office of the Company at Mardan for transacting
the |
|
| following
business. |
|
|
| 1.
To confirm the minutes of the last meeting held on 31st March, 1998. |
|
|
| 2.
To receive, and consider the audited Balance Sheet and Profit and Loss
Account of |
|
| the
Company together with the Directors' and Auditors' Reports for the year ended |
|
| 30th
September, 1998. |
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|
|
|
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| 3.
To declare a dividend. |
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|
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| 4.
To appoint auditors for the year 1998- 99 and to fix their remuneration. The |
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| outgoing
auditors, Messrs.. Hameed Chaudhri & Co., Chartered Accountants offer |
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| themselves
for re-appointment. |
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|
| 5.
Election of Directors: |
|
|
| To
hold election of Directors in place of retiring Directors (I) Begum Zari
Sarfaraz |
|
| (ii)
Khan Aziz Sarfaraz (ii) Begum Laila Sarfaraz (iv) Khan Abbas Sarfaraz (v) Ms. |
|
| Zarmine
Sarfaraz (vi) Begum Mehmooda Salim Khan (vii) Mr. Abdul Qadar Khattak |
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| (viii)
Mr. Muhammad Rafiq Khan (ix) Mr. Iskandar M. Khan, in accordance with the |
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| provision
of Section 178 of the Companies Ordinance, 1984. The Board of Directors |
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| has
fixed the total number of directors to be Nine for the next three years. |
|
|
| Any
person who seeks to contest election of the office of a director may file his |
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| nomination
papers with the Secretary of Company not later than 12th March, 1999. |
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| The
retiring directors shall be eligible for re-election. |
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|
|
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| 6.
To transact any other ordinary business of the Company as may be permitted by |
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| the Chair. |
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|
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| The
share transfer books of the Company will remain closed for entitlement of
dividend |
|
| from
20th March, 1999 to 26th March, 1999. (Both days inclusive) |
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|
|
|
By order of the Board |
|
|
|
|
|
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| Mardan: |
|
|
(MALIK MUHAMMAD ASLAM) FCMA |
|
| February
16, 1999 |
|
SECRETARY |
|
|
| N.B. |
Member unable to attend
in person may kindly sent proxy form attached with the balance sheet signed |
|
|
and witnessed to the
Company at least 48 hours before the time of the meeting. No person shall act |
|
|
as proxy unless he is
entitled to be present and vote in his own right. |
|
|
|
| DIRECTORS'
REPORT |
|
|
| The
Directors have pleasure in submitting their annual report alongwith audited
accounts of the |
|
| Company
for the year ended 30th September, 1998. |
|
|
| PRODUCTION
DATA |
|
|
|
| SUGARCANE |
|
|
1997-98 |
1996-97 |
|
| a)
Sugarcane crushed |
(tons) |
204,543.70 |
157,117.00 |
|
| b)
Sugar produced |
(tons) |
17,078.30 |
12,584.50 |
|
| c) Recovery |
|
(%) |
8.35 |
8.01 |
|
| d)
Working days |
|
97 |
80 |
|
|
| SUGARBEET |
|
|
| a)
Sugarbeet sliced |
(tons) |
55,772.68 |
96,509.00 |
|
| b)
Sugar produced |
(tons) |
4,238.50 |
8,303.00 |
|
| c) Recovery |
|
(%) |
7.60 |
8.60 |
|
| d)
Working days |
|
20 |
33 |
|
|
| GENERAL |
|
|
|
| 1.
SUGARCANE |
|
|
| The
sugarcane crushing season started on 5th November, 1997 and ended on 10th
Feb. 1998 after |
|
| crushing
only 204,544 tons of sugarcane and producing 17,078.30 tons of sugar at a
recovery of 8.35%. |
|
| The
sugarcane growers were paid Rs. 44.00 per 40 Kgs as against the support price
of Rs. 35.00 per 40 |
|
| Kgs.
While the sugarcane supply was more than last year but still much below our
requirement. The |
|
| reason
was huge diversion of sugarcane to gur making and that also of good quality. |
|
|
| The
price of sugar during the year was very low because of unchecked imports of
approximately 700,000 |
|
| tons
of sugar and record production of 3.5 million tons of sugar during the year
against total requirement |
|
| of
2.8/2.9 million tons. The Government allowed export of 400,000 tons of sugar.
However, this decision |
|
| was
taken very late and sugar prices did not recover and we sold our sugar much
below the cost of |
|
| production
and subtained huge losses. |
|
|
| 2.
SUGARBEET |
|
|
| Sugarbeet
slicing season started on the 25th May, 1998 and ended on 13th June, 1998.
The recovery for |
|
| the
year was low due to rains and very cold condition during growth period. |
|
|
| 3.
A sum of Rs. 12.00 million has been transferred to general reserve. |
|
|
| 4.
DISTILLERY |
|
|
| The
Distillery plant worked for 189 days as against 108 days of last year. Total
production of industrial |
|
| alcohol
was 827,042 gallons as against 665,081 gallons of last years. |
|
|
| 5. STAFF |
|
|
| Labour
and Management relations remained cordial during the year. All employees were
paid bonus |
|
| equivalent
to 2 months salary in addition to other amenities and statutory benefits. |
|
|
| 6.
SALES TAX ON SUGAR |
|
|
| The
Government imposed sales tax on sugar with effect from 1st April, 1998 and
reduced excise duty |
|
| from
Rs. 2100/- per ton to Rs. 400/- per ton. The present amount of sales tax and
excise duty works out |
|
| Rs.
2,480.00 per ton. |
|
|
| 7. DIVIDEND |
|
|
| The
company has suffered operational loss due to very high price of sugarcane,
low production and prices |
|
| of
sugar in the market. The net profit is from other income i.e. return on
investment and |
|
| interest
income etc. The Directors have however still recommended a 25% dividend for
the Year ended |
|
| 30th
September, 1998. |
|
|
| 8.
CURRENT CRUSHING SEASON 1998-99 |
|
|
| The
current crushing season started on 10th November 1998 and we have crushed
293,027 tons of |
|
| sugarcane
and produced 22,830 tons of sugar at an average recovery of 7.97% upto 12th
February, 1999. |
|
| The
supply of sugarcane is better and we expect to crush 350,000 tons of
sugarcane this year, which is |
|
| still
less than our requirement of 600,000 tons. The Government has allowed
mandatory export of 25% |
|
| production
to every sugar factory and there is a penalty if export is not made. We make
white plantation |
|
| sugar
and cannot compete with refined sugar in the international market and have
requested the |
|
| Government
to exempt the factories who make white plantation sugar from this penalty.
The growers are |
|
| paid
@ Rs. 35/- per 40 Kgs the price fixed by the Government. |
|
|
| 9.
SUGARBEET CROP 1999 |
|
|
| The
area under sugarbeet crop this year is almost the same as last year as the
growers diverted to wheat/ |
|
| potato
crops. |
|
|
| 10.
AUDITORS |
|
|
| The
present auditors Messrs Hameed Chaudhri & Co., Chartered Accountants,
Lahore retire and |
|
| being
eligible offer themselves for reappointment. |
|
|
| 11.
ELECTION OF DIRECTORS |
|
|
| All
directors retire in accordance with Section 178 of the Companies Ordinance
1984 and fresh election |
|
| will
be held in the Annual General Meeting. |
|
|
| The
Directors appreciate the spirit of good work done by the Company's staff at
all level. |
|
|
|
|
ON BEHALF OF THE BOARD |
|
|
|
|
|
|
|
|
|
(KHAN ABBAS SARFARAZ) |
|
| MARDAN:
February 16, 1999. |
|
CHIEF EXECUTIVE |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS OF |
|
| THE
PREMIER SUGAR MILLS & DISTILLERY COMPANY LIMITED |
|
|
| We
have audited the annexed Balance Sheet of THE PREMIER SUGAR MILLS &
DISTILLERY |
|
| COMPANY
LIMITED as at 30 September, 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: |
|
|
| (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 the 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 30 September, 1998 and of
the |
|
| profit
and cash flows for the year then ended; and |
|
|
| (d)
in our opinion, Zakat deductible at source under the Zakat and Ushr
Ordinance, 1980 |
|
| was
deducted by the Company and deposited in the Central Zakat Fund established |
|
| under
section 7 of that Ordinance. |
|
|
|
|
|
|
HAMEED CHAUDHRI & CO., |
|
| LAHORE:
February 17, 1999. |
|
CHARTERED ACCOUNTANTS |
|
|
|
|
|
|
|
| BALANCE
SHEET AS AT 30 SEPTEMBER, 1998 |
|
|
|
|
|
1998 |
1997 |
|
|
|
Note |
Rupees |
Rupees |
|
| SHARE
CAPITAL AND RESERVES |
|
|
| Authorised
capital |
|
|
|
| 5,750,000
ordinary shares of |
|
|
| Rs10 each |
|
|
|
57,500,000 |
57,500,000 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| Issued,
subscribed and paid-up |
|
|
|
| capital |
|
3 |
37,500,000 |
37,500,000 |
|
|
|
|
|
| Reserves |
|
4 |
587,000,600 |
575,000,600 |
|
|
|
|
|
| Unappropriated
profit |
|
|
519,427 |
227,997 |
|
|
|
|
---------- |
---------- |
|
|
|
625,020,027 |
612,728,597 |
|
|
|
|
|
|
|
|
|
|
|
| LONG
TERM LOAN |
|
5 |
10,539,535 |
13,151,535 |
|
|
|
|
|
|
| DEFERRED
LIABILITIES |
|
|
|
|
| Deferred
taxation |
|
6 |
7,118,000 |
7,081,000 |
|
| Provision
for staff gratuity |
|
|
15,113,855 |
14,973,219 |
|
|
|
|
---------- |
---------- |
|
|
|
|
22,231,855 |
22,054,219 |
|
| CURRENT
LIABILITIES |
|
|
| Current
portion of long term loan |
|
5 |
2,612,000 |
2,260,000 |
|
|
|
|
|
| Short
term finances |
|
7 |
39,999,410 |
55,780,032 |
|
|
|
|
|
| Creditors,
accruals and other |
|
|
|
| liabilities |
|
8 |
23,235,137 |
25,437,967 |
|
|
|
|
| Workers'
welfare fund |
|
|
866,164 |
1,026,578 |
|
|
|
|
| Provision
for taxation |
|
9 |
3,641,260 |
2,771,021 |
|
|
|
|
|
| Dividends |
|
10 |
10,960,497 |
10,842,383 |
|
|
|
|
---------- |
---------- |
|
|
|
|
81,314,468 |
98,117,981 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
11 |
---------- |
---------- |
|
|
|
|
739,105,885 |
746,052,332 |
|
|
|
|
========== |
========== |
|
|
| FIXED
CAPITAL EXPENDITURE |
|
|
| Operating
fixed assets |
|
12 |
91,115,809 |
95,700,671 |
|
|
|
|
|
| Non-operating
fixed assets |
|
12 |
14,544,000 |
14,544,000 |
|
| Capital
work-in-progress |
|
|
0 |
52,650 |
|
|
|
|
|
| Stores
held for capital |
|
|
|
| expenditure |
|
|
4,431,733 |
0 |
|
|
|
|
---------- |
---------- |
|
|
|
|
110,091,542 |
110,297,321 |
|
|
|
|
|
| INVESTMENTS |
|
13 |
55,711,771 |
72,457,521 |
|
|
|
|
|
|
| LONG
TERM LOANS TO |
|
|
|
|
| SUBSIDIARY
COMPANIES |
|
14 |
8,000,000 |
10,000,000 |
|
|
|
|
|
| LONG
TERM LOANS |
|
15 |
6,107 |
13,819 |
|
| SECURITY
DEPOSITS |
|
|
482,929 |
469,929 |
|
| CURRENT
ASSETS |
|
|
| Stores
and spares |
|
16 |
65,208,241 |
60,926,141 |
|
|
|
|
|
| Stock-in-trade |
|
17 |
64,986,000 |
92,418,000 |
|
| Trade
debtors |
|
18 |
40,109,914 |
18,108,320 |
|
| Advances,
deposits, prepayments |
|
|
|
| and
other receivables |
|
19 |
41,340,586 |
38,660,167 |
|
|
|
|
|
| Cash
and bank balances |
|
20 |
353,168,795 |
342,701,114 |
|
|
|
|
---------- |
---------- |
|
|
|
|
564,813,536 |
552,813,742 |
|
|
|
|
---------- |
---------- |
|
|
|
|
|
739,105,885 |
746,052,332 |
|
|
|
|
========== |
========== |
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
ABDUL QADAR KHATTAK |
|
|
MUHAMMAD RAFIQ KHAN |
|
KHAN ABBAS SARFARAZ |
|
|
DIRECTOR |
|
|
DIRECTOR |
|
CHIEF EXECUTIVE |
|
|
|
|
|
|
|
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED 30 SEPTEMBER, 1998 |
|
|
|
|
|
|
|
1998 |
1997 |
|
|
|
Note |
Rupees |
Rupees |
|
|
|
|
|
| SALES- Net |
|
21 |
433,224,096 |
313,508,821 |
|
| COST
OF SALES |
|
22 |
412,861,022 |
271,642,751 |
|
|
|
|
---------- |
---------- |
|
| GROSS
PROFIT |
|
|
20,363,074 |
41,866,070 |
|
|
|
|
|
|
| OPERATING
EXPENSES |
|
|
|
| Selling
and distribution |
|
23 |
613,990 |
460,768 |
|
| Administrative
and general |
|
24 |
22,590,764 |
21,209,832 |
|
|
|
|
---------- |
---------- |
|
|
|
|
23,204,754 |
21,670,600 |
|
|
|
|
|
|
| OPERATING
PROFIT |
|
|
(2,841,680) |
20,195,470 |
|
| OTHER
INCOME - Net |
|
25 |
50,045,366 |
63,668,848 |
|
|
|
|
---------- |
---------- |
|
|
|
|
47,203,686 |
83,864,318 |
|
|
|
|
---------- |
---------- |
|
| OTHER
CHARGES |
|
|
|
|
|
| Financial |
|
26 |
19,102,906 |
21,035,428 |
|
| Workers'
welfare fund |
|
|
154,966 |
424,064 |
|
| Workers'
(profit) participation fund |
|
1,405,000 |
3,141,445 |
|
|
|
|
---------- |
---------- |
|
|
|
|
20,662,872 |
24,600,937 |
|
|
|
|
---------- |
---------- |
|
| PROFIT
BEFORE TAXATION |
|
|
26,540,814 |
59,263,381 |
|
|
|
|
|
| PROVISION
FOR TAXATION |
|
|
|
| Current |
|
|
2,400,000 |
5,250,000 |
|
| Prior years |
|
|
2,437,384 |
(1,753,655) |
|
| Deferred |
|
|
37,000 |
(1,286,000) |
|
|
|
|
---------- |
---------- |
|
|
|
|
4,874,384 |
2,210,345 |
|
|
|
|
---------- |
---------- |
|
| PROFIT
AFTER TAXATION |
|
|
21,666,430 |
57,053,036 |
|
| UNAPPRORIATED
PROFIT |
|
|
|
| -
Brought forward |
|
227,997 |
549,961 |
|
|
|
---------- |
---------- |
|
| PROFIT
AVAILABLE FOR APPROPRIATION |
|
21,894,427 |
57,602,997 |
|
| APPROPRIATIONS: |
|
|
| Transfer
to general reserve |
|
12,000,000 |
480,000,001 |
|
| Proposed
dividend 25% (1997:@ 25%) |
|
9,375,000 |
9,375,000 |
|
|
|
---------- |
---------- |
|
|
|
21,375,000 |
57,375,000 |
|
|
|
|
|
| UNAPPROPRIATED
PROFIT |
|
|
|
---------- |
---------- |
|
| -
Carried to Balance Sheet |
|
519,427 |
227,997 |
|
|
|
|
========== |
========== |
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
| ABDUL
QADAR KHATTAK |
MUHAMMAD RAFIQ KHAN |
KHAN ABBAS SARFARAZ |
|
| DIRECTOR |
|
DIRECTOR |
|
CHIEF EXECUTIVE |
|
|
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED 30 SEPTEMBER, 1998 |
|
|
|
|
|
|
|
1998 |
1997 |
|
|
|
|
Rupees |
Rupees |
|
| NET
CASH INFLOW/(OUTFLOW) FROM OPERATING |
|
| ACTIVITIES
(note 'A') |
|
60,392,852 |
(58,829,016) |
|
|
|
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
|
|
| Fixed
capital expenditure |
|
(8,218,131) |
(364,250) |
|
| Sale
proceeds of fixed assets |
|
81 |
82,005 |
|
| Investments
made |
|
0 |
(500,000) |
|
| Long
term loan advanced to a Subsidiary |
|
|
|
| Company |
|
0 |
(10,000,000) |
|
| Interest
on loan to Subsidiary Companies |
|
| and
long term foreign currency fixed deposits |
|
4,187,114 |
17,729,558 |
|
| Dividend
Income |
|
2,090,524 |
4,991,017 |
|
| Long
term foreign currency fixed deposits |
|
|
| realised |
|
0 |
55,269,283 |
|
|
|
|
|
|
| NET
CASH (OUTFLOW)/INFLOW FROM |
|
|
|
| INVESTING
ACTIVITIES |
|
(1,940,412) |
67,207,613 |
|
|
|
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
|
|
| Repayment
of long term loan |
|
(2,260,000) |
(1,956,000) |
|
| Short
term finances - net |
|
(15,780,622) |
55,780,032 |
|
| Financial
charges paid |
|
(20,983,095) |
(13,522,507) |
|
| Dividend
paid |
|
(8,961,042) |
(7,171,579) |
|
|
|
|
| NET
CASH (OUTFLOW)/INFLOW FROM FINANCING |
|
| ACTIVITIES |
|
(47,984,759) |
33,129,946 |
|
|
|
---------- |
---------- |
|
| NET
INCREASE IN CASH AND CASH EQUIVALENTS |
|
10,467,681 |
41,508,543 |
|
|
|
|
| CASH
AND CASH EQUIVALENTS |
|
|
| -
At the beginning of the year |
|
|
342,701,114 |
301,192,571 |
|
|
|
|
| CASH
AND CASH EQUIVALENTS |
|
|
---------- |
-- |
