| Transpak Corporation Limited |
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|
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|
| Annual
Report 1998 |
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| CONTENTS |
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|
| Company
Information |
|
| Notice
of Meeting |
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| Directors'
Report |
|
| Auditors'
Report |
|
| Balance
Sheet |
|
| Profit
& Loss Account |
|
| Cash
Flow Statement |
|
| Notes
to the Cash Flow Statement |
|
| Notes
to the accounts |
|
| Form 'A' |
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|
|
|
| COMPANY
INFORMATION |
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|
|
| CHAIRMAN |
|
Suleman Dawood |
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|
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| CHIEF
EXECUTIVE |
Bashir Dawood |
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| DIRECTORS |
|
Razzak S. Dawood |
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|
Mohd. Younus Ali Muhammad |
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|
Mohd. Amin Ali Muhammad |
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|
Arif Dawood |
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|
Manzoor H. Chaudhry |
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| COMPANY
SECRETARY |
Muhammad Arif Dangra |
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| AUDITORS |
|
Gangat & Company |
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|
Chartered Accountants |
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| BANKERS |
|
Habib Bank AG Zurich |
|
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|
Metropolitan Bank Limited |
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|
American Express Bank
Limited |
|
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|
Muslim Commercial Bank
Limited |
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| REGISTERED
OFFICE |
Dawood Centre |
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|
M.T. Khan Road, Karachi. |
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| LEGAL
ADVISERS |
Messrs. Hussain &
Haider |
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|
Advocates &
Solicitors |
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| NOTICE
OF MEETING |
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| Notice
is hereby given that the 24th Annual General Meeting of the Share holders of
the Company |
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| will
be held on Saturday the December 19, 1998 at 2.00 p.m. at the Registered
Office of the Company |
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| at
Dawood Centre, Moulvi Tamizuddin Khan Road, Karachi to transact the followin9
business: |
|
|
| 1.
To confirm the minutes of the last annual general meeting held on December
29, 1997. |
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|
|
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| 2.
To receive, consider and adopt the Directors' and Auditors' Reports, the
Audited Balance |
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| Sheet
and Profit & Loss Account for the year ended June 30, 1998. |
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|
| 3.
To approve the payment of cash dividend as recommended by the Directors. |
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| 4.
To appoint Auditors and fix their remuneration. |
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| SPECIAL
BUSINESS: |
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| 5.
To approve the remuneration of the Chief Executive and working Director of
the Company. |
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| To
transact any other business with the permission of the Chair. |
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|
By order of the Board |
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|
|
MUHAMMAD ARIF DANGRA |
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| Karachi:
November 21, 1998 |
|
Company Secretary |
|
|
| NOTES: |
|
|
|
| 1.
The share transfer book of the Company shall remain closed from 16-12-98 to
23-12-98 |
|
| (both
days inclusive) and no transfer will be accepted for registration during this
period. The |
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| members
whose names appear in the register of members as at the close of business on |
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| December
15, 1998 will qualify for the payment of dividend. |
|
|
| 2.
A member entitled to attend and vote at the meeting may appoint another
member as his/ her |
|
| proxy
to attend and vote for him/her. Proxies in order to be effective must be
received at the |
|
| registered
office of the Company not less than 48 hours before the time of holding the
meeting. |
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| (Proxy
Form is enclosed). |
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|
|
|
|
|
| 3.
Members are requested to communicate to the Company any change of their
address. |
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|
| STATEMENT
IN REGARD TO SPECIAL BUSINESS |
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|
| Remuneration
to Chief Executive and full time working Director: |
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|
|
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| The
shareholders approval will be sought for the payment of remuneration and the
provision |
|
| of
certain facilities to the Chief Executive and full time working Director in
accordance with their |
|
| terms
and conditions of service with the Company. |
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|
|
|
| For
this purpose, the following Ordinary Resolution which sets out the terms of
appointment |
|
| of
the Chief Executive and full time working Director will be moved at the
Meeting. |
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|
|
|
| "RESOLVED
that consent be and is hereby given for the payment as remuneration to |
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| Mr.
Bashir Dawood, Chief Executive of the Company a sum not exceeding Rs.
1,200,000/- per |
|
| year
and Mr. Manzooor H. Chaudhry, full time working Director of the Company a sum
not |
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| exceding
Rs. 900,000/- per year effective from July 1, 1998. |
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|
|
| DIRECTORS'
REPORT |
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| The
Directors of your company have pleasure in |
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|
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| presenting
their Annual Report alongwith the |
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|
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| Accounts
of the Company for the year ended |
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| June
30, 1998. |
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| RESULTS |
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|
|
|
1998 |
1997 |
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|
|
(RUPEES) |
(RUPEES) |
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|
|
|
|
|
| APPROPRIATION |
|
|
|
|
|
|
|
|
|
|
| Profit
for the year |
|
7,744,394 |
11,268,098 |
|
| Unappropriated
profit |
|
|
| brought
forward |
|
3,739,465 |
1,471,367 |
|
|
|
---------- |
---------- |
|
| Profit
available for |
|
|
| appropriation |
|
11,483,859 |
12,739,465 |
|
| Proposed
dividend |
|
|
|
|
|
| 30%
(1997: 30%) |
|
9,000,000 |
9,000,000 |
|
|
|
|
|
|
| Unappropriated
profit |
|
|
---------- |
---------- |
|
| carried
forward |
|
2,483,859 |
3,739,465 |
|
|
|
========== |
========== |
|
|
|
|
| During
the period, your company's turnover was |
|
|
| Rs.
315,751 millions as compared to last years |
|
|
| turnover
of Rs. 319,209 millions. This slightly |
|
|
| decrease
in turnover was mainly due to the tough |
|
|
| market
competition, overall economic and financial |
|
|
| condition
of the country. However due to the tough |
|
|
| competition
in the market, it was necessary to |
|
|
|
| make
heavy expenses on advertisement & sales |
|
|
|
| promotion,
resulting into your company's overall |
|
|
|
| lower
profitability before tax which was reduced by |
|
|
| 16%
from Rs. 16,786 millions to Rs. 14.108 millions. |
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|
|
|
|
|
|
| I
am happy to report that your Company's brand of |
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|
| "SPARKLE"
tooth pastes, "SHIELD" tooth brushes, |
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|
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| and
"SHIELD" feeders, nipples and soothers |
|
|
|
| maintained
their leadership position in their |
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|
|
| respective
product categories. |
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|
|
|
|
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| During
the year, we have launched Household |
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|
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| products
under the brand name of "EXCEL" in the |
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|
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| market.
These products are quite new in Pakistan |
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|
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| market,
so the result was not upto our expectation. |
|
|
| However,
we are planning to put new strategy to |
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| achieve
our goal. |
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|
| FUTURE PLAN: |
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| During
1998-1999, we have planned to increase |
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| the
range of SHIELD tooth brushes so as to attract |
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| an
even greater segment of the market. INSHA |
|
| ALLAH
the product expansion strategy will further |
|
| strengthen
your company's market share. Plans |
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| are
also being finalised to increase the range of the |
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| products
in the BABYCARE segment of your |
|
| company's
activities. |
|
|
| Your
company's products are now well established |
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| in
the market and the Board of Directors believes |
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| that
the future prospects are bright. |
|
|
| The
Board is also looking forward to the better |
|
| results
in near future and sincerely thank all |
|
| company's
personnel and business associates |
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| whose
cooperation and efforts have materially |
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| contributed
to the success of your company. |
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|
| AUDITORS: |
|
|
| The
auditors M/s. Gangat & Company, Chartered |
|
| Accountants
retire and offer themselves for |
|
| reappointment. |
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|
|
|
On behalf of the Board of Directors |
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|
|
|
|
|
|
SULEMAN DAWOOD |
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| Karachi:
November 21, 1998 |
|
Chairman |
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of Transpak Corporation Ltd. as at
June 30, 1998 |
|
| and
the related profit and loss account and the cash flow statement together with
the notes forming |
|
| part
thereof, for the year then ended and we state that we have obtained all the
informations |
|
| 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
Company's Ordinance, 1984; |
|
|
| (b)
in our opinion: |
|
|
|
|
|
|
| (i)
the balance sheet and profit and loss account together with the notes thereon
have |
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| been
drawn up in conformity with the Companies Ordinance, 1984 and are in
agreement |
|
| with
the books of accounts 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 statements
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 changes in the
cash position |
|
| 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. |
|
|
|
|
|
|
GANGAT & COMPANY |
|
| Karachi:
November 21, 1998 |
|
Chartered Accountants |
|
|
|
|
| Balance
Sheet |
|
| AS
AT JUNE 30, 1998 |
|
|
|
| CAPITAL
& LIABILITIES |
|
|
|
|
|
|
|
|
NOTE |
1998 |
1997 |
|
| SHARE
CAPITAL & RESERVES |
|
|
| Authorised
capital |
|
|
|
| 10,000,000 ordinary
shares of Rs. 10/- each |
|
100,000,000 |
100,000,000 |
|
|
|
|
========== |
========== |
|
| Issued,
subscribed & paid-up capital |
|
| 3,000,000
ordinary shares |
|
|
| of Rs. 10/- each fully
paid-up in cash |
|
30,000,000 |
30,000,000 |
|
| Reserve
and surplus |
|
|
|
| Revenue reserve - General |
|
2 |
22,500,000 |
22,500,000 |
|
| Capital reserve - Share premium |
|
3 |
10,000,000 |
10,000,000 |
|
| Unappropriated
profit |
|
|
2,483,859 |
3,739,465 |
|
|
|
|
---------- |
---------- |
|
|
|
|
34,983,859 |
36,239,465 |
|
|
|
|
---------- |
---------- |
|
| Shareholders'
equity |
|
|
64,983,859 |
66,239,465 |
|
|
|
|
|
|
| LIABILITIES
AGAINST ASSETS SUBJECT TO |
|
|
| FINANCE LEASE |
|
4 |
488,430 |
1,226,763 |
|
| DEFERRED LIABILITIES |
|
5 |
12,847,640 |
10,940,081 |
|
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
| Bank finances |
|
6 |
74,192,392 |
41,486,949 |
|
| Shod term loan |
|
7 |
20,000,000 |
20,000,000 |
|
| Current
maturity of redeemable capital |
|
- |
1,017,583 |
|
| Current
portion of liabilities against assets |
|
|
|
| subject to
finance lease |
4 |
738,333 |
619,354 |
|
| Creditors & accrued
liabilities |
8 |
97,976,056 |
86,854,384 |
|
| Provision
for taxation |
|
|
4,200,000 |
6,318,120 |
|
| Unclaimed
dividend |
|
|
177,809 |
3,860,591 |
|
| Proposed
dividend |
|
9,000,000 |
9,000,000 |
|
|
|
---------- |
---------- |
|
|
|
206,284,590 |
169,156,981 |
|
| CONTINGENCIES &
COMMITMENTS |
9 |
- |
- |
|
|
|
---------- |
---------- |
|
| Total Rupees |
|
|
284,604,519 |
247,563,290 |
|
|
|
|
|
========== |
========== |
|
|
| PROPERTY
& ASSETS |
|
|
|
|
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating assets |
|
10 |
56,677,286 |
51,649,684 |
|
| Assets subject to finance
lease |
|
11 |
1,349,120 |
1,686,400 |
|
| Capital work in progress |
|
12 |
28,103,968 |
24,138,006 |
|
|
|
|
---------- |
---------- |
|
|
|
|
86,130,374 |
77,474,090 |
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
| Stock-in-trade |
|
13 |
90,926,757 |
70,224,726 |
|
| Stores & spares |
|
14 |
5,330,528 |
4,173,285 |
|
| Trade debtors -
unsecured, considered good |
15 |
80,893,544 |
76,866,892 |
|
| Advances & deposits |
|
16 |
18,570,143 |
15,482,489 |
|
| Cash & bank balances |
|
17 |
2,753,173 |
3,341,808 |
|
|
|
|
---------- |
---------- |
|
|
|
|
198,474,145 |
170,089,200 |
|
|
|
|
---------- |
---------- |
|
| Total Rupees |
|
|
|
284,604,519 |
247,563,290 |
|
|
|
|
========== |
========== |
|
| On
behalf of the Board |
|
| The
annexed notes form an integral |
|
This is the Balance Sheet
referred to |
|
| part
of the Balance Sheet |
|
in our report of even
date |
|
|
|
SULEMAN DAWOOD |
|
RAZZAK S. DAWOOD |
|
BASHIR DAWOOD |
|
GANGAT & COMPANY |
|
|
Chairman |
|
Director |
|
Chief Executive |
|
Chartered Accountants |
|
| KARACHI:
November 21, 1998 |
|
|
|
| Profit
& Loss Account |
|
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
| PARTICULARS |
|
|
1998 |
1997 |
|
|
|
NOTE |
(RUPEES) |
(RUPEES) |
|
|
|
|
|
| Sales and commission |
|
18 |
315,751,645 |
319,209,007 |
|
| Less: Cost of goods sold |
|
19 |
234,250,530 |
250,828,674 |
|
|
|
|
---------- |
---------- |
|
| Gross profit |
|
|
81,501,115 |
68,380,333 |
|
| Less:
Operating expenses |
|
|
|
| Administrative &
selling |
20 |
55,478,125 |
43,395,579 |
|
| Financial |
|
21 |
11,046,947 |
7,159,054 |
|
|
|
|
---------- |
---------- |
|
|
|
|
66,525,072 |
50,554,633 |
|
|
|
|
---------- |
---------- |
|
| Net
operating profit |
|
|
14,976,043 |
17,825,700 |
|
| Add: Non-operating income |
|
22 |
248,484 |
317,531 |
|
|
|
|
---------- |
---------- |
|
| Net
profit for the year |
|
|
15,224,527 |
18,143,231 |
|
| Less: Other charges |
|
23 |
1,116,712 |
1,357,013 |
|
|
|
|
---------- |
---------- |
|
| Profit
before taxation |
|
|
14,107,815 |
16,786,218 |
|
| Less: Taxation |
|
24 |
6,363,421 |
5,518,120 |
|
|
|
|
---------- |
---------- |
|
| Profit
after taxation |
|
|
7,744,394 |
11,268,098 |
|
| Add:
Unappropriated profit from the previous year |
3,739,465 |
1,471,367 |
|
|
|
|
---------- |
---------- |
|
| Profit
available for appropriation |
|
|
11,483,859 |
12,739,465 |
|
|
|
|
|
|
| APPROPRIATION: |
|
|
| Proposed
dividend |
|
|
9,000,000 |
9,000,000 |
|
|
|
|
---------- |
---------- |
|
| Unappropriated
profit carried forward |
|
2,483,859 |
3,739,465 |
|
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral pad of these accounts |
|
|
| This
is the profit and loss account |
|
| referred
to in our report of even date. |
|
|
| GANGAT & CO. |
|
SULEMAN DAWOOD |
RAZZAK S. DAWOOD |
BASHIR DAWOOD |
|
| Chartered
Accountants |
Chairman |
|
Director |
|
Chief Executive |
|
|
| Karachi:
November 21, 1998 |
|
|
|
| Cash
Flow Statement |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
|
|
|
|
1998 |
1997 |
|
|
NOTE |
(RUPEES) |
(RUPEES) |
|
|
|
|
| CASH
FLOW OPERATING ACTIVITIES: |
|
|
|
|
|
| Cash
generated from operations |
|
A |
20,267,635 |
18,332,973 |
|
| Financial
charges paid |
|
|
(11,046,947) |
(7,159,054) |
|
| Taxes paid |
|
|
(12,895,575) |
(13,617,931) |
|
|
|
|
---------- |
---------- |
|
| Net
cash (outflow)/from operating activities |
|
(3,674,887) |
(2,444,012) |
|
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
| Fixed
capital expenditure (including capital work in progress) |
(15,383,721) |
(19,792,921) |
|
| Liabilities
against assets subject to finance lease |
- |
2,108,000 |
|
| Sale
proceeds of fixed assets |
|
84,250 |
473,182 |
|
| Short
term loan from a financial institution |
|
- |
20,000,000 |
|
|
|
|
---------- |
---------- |
|
| Net
cash inflow/(out flow) from investing activities |
(15,299,471) |
2,788,261 |
|
|
|
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES: |
|
| Repayment
of redeemable capital |
|
(1,017,583) |
(1,827,156) |
|
| Repayment
of liabilities against assets subject to finance lease |
(619,354) |
(261,883) |
|
| Assets
subject to finance lease |
|
- |
(2,108,000) |
|
| Dividend
paid |
|
(12,682,783) |
(5,496,839) |
|
|
|
---------- |
---------- |
|
| Net
cash (outflow) from financing activities |
|
(14,319,720) |
(9,693,878) |
|
|
|
---------- |
---------- |
|
| Net
(decrease) in cash and equivalents |
|
33,294,078) |
(9,349,629) |
|
| Cash
and cash equivalents at the beginning of the year B |
(38,145,141) |
(28,795,512) |
|
|
|
|
---------- |
---------- |
|
| Cash
and cash equivalents at the end of the year |
B |
(71,439,219) |
(38,145 141) |
|
|
|
|
========== |
========== |
|
|
|
| Notes
to the |
|
| Cash
Flow Statement |
|
| FOR THE YEAR ENDED JUNE 30,
1998 |
|
|
|
|
|
|
|
|
1998 |
1997 |
|
|
|
|
(RUPEES) |
(RUPEES) |
|
|
|
|
| A.
CASH FLOW FROM OPERATING ACTIVITIES: |
|
|
|
|
|
| Profit
before taxation |
|
|
|
14,107,815 |
16,786,218 |
|
| Add/(less)
adjustment for non-cash charges and other items: |
|
|
|
| Depreciation
& amortization |
|
|
6,707,560 |
6,207,710 |
|
| Provision
for gratuity |
|
|
|
1,657,559 |
2,095,488 |
|
| Profit
on sale of fixed assets |
|
|
(64,373) |
(253,702) |
|
| Financial
charges |
|
|
|
11,046,947 |
7,159,054 |
|
|
|
|
|
---------- |
---------- |
|
| Profit
before working capital changes |
|
33,455,508 |
31,994,768 |
|
|
|
|
| Effect
on cash flow due to working capital changes |
|
| (Increase)
in stock in trade |
|
(20,702,031) |
(18,675,644) |
|
| (Increase/decrease
in store & spares |
|
(1,157,243) |
(920,864) |
|
| (Increase)
in trade debtors |
|
(4,026,652) |
(22,444,233) |
|
| (Increase)/decrease
in advance & deposit (excluding taxation) |
1,576,381 |
(1,537,272) |
|
| Increase
in Creditors & accrued liabilities |
|
11,121,672 |
29,916,218 |
|
|
|
---------- |
---------- |
|
|
|
(13,187,873) |
(13,661,795) |
|
|
|
---------- |
---------- |
|
|
|
20,267,635 |
18,332,973 |
|
|
|
========== |
========== |
|
|
|
|
| B.
CASH AND CASH EQUIVALENTS: |
|
|
|
| Cash
and bank balances |
|
2,753,173 |
3,341,808 |
|
| Short
term running finances |
|
(74,192,392) |
(41,486,949) |
|
|
|
---------- |
---------- |
|
|
|
(71,439,219) |
(38,145,141) |
|
|
|
========== |
========== |
|
|
|
|
|
| Notes
to the Accounts |
|
| FOR
THE YEAR ENDED JUNE 30, 1998 |
|
|
| 1.
PRINCIPAL ACCOUNTING POLICIES |
|
|
| As
in previous years these accounts have been prepared in accordance with the
historical cost |
|
| convention
without any adjustments for the effect of inflation or current values. The
following is a |
|
| summary
of the more important accounting policies employed by the company. |
|
|
| 1.1
TANGIBLE FIXED ASSETS |
|
| Operating
assets are stated at historical cost less accumulated depreciation, whereas
capital |
|
| work-in-progress
is stated at cost. |
|
|
| Except
for leasehold land which is amortised on straight line basis at the annual
rate of one |
|
| per
cent, depreciation on all the other operating assets is provided on the
diminishing balance |
|
| method
at the following rates: |
|
|
