| Buxly Paints Limited Karachi |
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| Annual
Report 2000 |
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| CONTENTS |
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| BOARD
OF DIRECTORS |
|
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| NOTICE
OF MEETING |
|
| REPORT
OF THE DIRECTORS |
|
| AUDITORS
REPORT TO THE MEMBERS |
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| BALANCE
SHEET |
|
| P
& L ACCOUNT |
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION (CASH FLOW STATEMENT) |
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| NOTES
TO THE ACCOUNTS |
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|
| PATTERN
OF SHAREHOLDINGS |
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|
|
| BOARD
OF DIRECTORS |
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| CHAIRMAN |
|
Wassim Alam Khan |
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| DIRECTORS |
|
Mrs. Kaiser Sultana Khan |
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|
Mrs. Amtul Rauf Khan |
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|
Miss Ayla F. Khan |
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|
Muhammad Saeed |
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|
Sheikh Ajaz Majid |
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|
Shahid Anwar |
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|
Jamal Khurshid (Alternate
to Sheikh Ajaz Majid) |
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| MANAGING
DIRECTOR & |
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| CHIEF
EXECUTIVE |
Yusuf Babar Khan |
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| COMPANY
SECRETARY |
Muhammad Khan |
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| AUDITORS |
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Ford, Rhodes, Robson,
Morrow |
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|
Chartered Accountants |
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| LEGAL
ADVISOR |
Abdus Samad |
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| BANKERS |
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The Muslim Commercial
Bank Ltd. |
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Habib Bank Ltd. |
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National Bank of Pakistan |
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Bank Al-Habib Ltd. |
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| REGISTERED
OFFICE |
E/20, S.I.T.E., |
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Polytechnic Road,
Karachi-75700 |
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| FACTORIES |
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X-3, S. I.T.E., |
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|
Manghopir Road,
Karachi-75700 (Works 1) |
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E/20, S.I.T.E., |
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Polytechnic Road,
Karachi-75700 (Works 2) |
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| NOTICE
OF MEETING |
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| Notice
is hereby given that the Forty-Sixth Annual General Meeting of the
shareholders of Messrs Buxly Paints Limited, |
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| Karachi
will be held at the Registered Office of the Company at E/20, S.I.T.E.,
Polytechnic Road, Karachi-75700 on Wednesday, |
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| the
20th December, 2000 at 9:00 a.m. to transact the following business:- |
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| 1.
To confirm the Minutes of the 45th Annual General Meeting held on Wednesday,
the 29th December, 1999. |
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| 2.
To receive, consider and adopt the audited Balance Sheet and Profit &
Loss Account together with the Directors' and |
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| Auditors'
Report thereon for the year ended 30th June, 2000. |
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| 3.
To appoint Auditors for the ensuing year and approve their remuneration. The
retiring Auditors M/s. Ford, Rhodes, |
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| Robson,
Morrow have offered themselves for re-appointment at existing remuneration. |
|
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| Special
Business |
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| 4.
To approve (as Ordinary Resolution), the remuneration and allowances of the
Chief Executive of the Company as |
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| fixed/recommended
by Directors (see statement annexed). |
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| 5.
To transact any other business which may legally be transacted at Annual
General Meeting. |
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By Order of the Board |
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| Karachi: |
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|
Muhammad Khan |
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| 27th
November, 2000 |
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Company Secretary |
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| AGENDA
ITEM 4, Statement under Section 160(B) of Companies Ordinance, 1984: |
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| The
Board of Directors of the Company at its meeting held on June 12, 2000 has
appointed Mr. Yusuf Babar Khan as Chief |
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| Executive
of the Company from June 12, 2000 and has approved and recommended his
remuneration at its meeting held on |
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| September
6, 2000 and as advised to the members through Company's letter dated
September 23, 2000 the following |
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| resolution
is now passed:- |
|
|
| "Resolved
that the remuneration and allowances of Chief Executive as fixed by the Board
of Directors under clause 78 of the |
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| Company's
Articles of association, in its meeting held on September 6, 2000 to take
effect from September 01, 2000:- |
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|
| 1
Basic Salary Rs. 288,000/- per annum. |
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| 2.
House Rent 45% of Basic Salary. |
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| 3.
Perquisites and allowances Rs. 408,000/= per annum. |
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| He
will also be entitled to medical expenses at actual. |
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| Company
maintained 1300 CC car and 10% of Company's profit after tax for the year
ending 30-06-2001. |
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| The
company will also pay income tax liability of his monthly salary. |
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| be
and are hereby approved." |
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| Notes: |
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| 1.
The Share Transfer Books of the company will remain closed from Thursday the
14th December, 2000 to Thursday the |
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| 28th
December, 2000 both days inclusive. No Transfers will be admitted/registered
after 1.00 p.m. on Wednesday the |
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| 13th
December, 2000. |
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|
| 2.
Any member of the company entitled to attend and vote may appoint a Proxy to
attend and vote instead of him/her. |
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| Proxies
must be received at the registered office of the company not later than 48
hours before the meeting. |
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| 3.
Shareholders are requested to notify the company of any change in their
addresses immediately. |
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| REPORT
OF THE DIRECTORS |
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| Dear
Shareholders |
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|
| The
company for the last two years has been suffering operational losses. The
loss for the current year has surpassed |
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| all
expectations. The management is making continuous efforts to reduce expenses
as per Directors' report 1998-99 and |
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| working
on ways and means to make good the heavy losses. |
|
|
| Management
has decided to apply all possible legal ways and means to cut down further
losses. Company has |
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| already
retrenched quite sizable staff to achieve the above objective and will take
all such steps to save the Company from |
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| further losses. |
|
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| The
Company has tried its utmost to persuade the government to finish off double
taxation but has failed so far. Paint |
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| Industry
attract Excise Duty as well as Sales Tax. All organized Public Companies are
under pressure and one of the listed |
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| Company
has stopped its Production altogether. |
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|
2000 |
1999 |
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|
|
|
Rupees |
Rupees |
|
| TRADING
RESULTS: |
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| The
net loss for the year after deducting all |
|
| Charges
and administration & Selling expenses. |
|
(12,325,831) |
(4,752,249) |
|
|
|
|
|
|
| Add:
Provision for taxation |
|
1,206,546 |
930,942 |
|
|
|
------------------ |
------------------ |
|
| Loss
after taxation |
|
(13,532,377) |
(5,683,191) |
|
| Add:
Unappropriated (Loss)/Profit |
|
|
|
| brought forward |
|
(5,614,400) |
68,791 |
|
|
|
------------------ |
------------------ |
|
|
|
(19,146,777) |
(5,614,400) |
|
|
| Appropriation: |
|
| Proposed
divided |
|
-- |
-- |
|
|
------------------ |
------------------ |
|
| Unappropriated
Loss carried forward |
|
(19,146,777) |
(5,614,400) |
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|
========== |
========== |
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| PATTERN
OF SHARE HOLDING: |
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| The
Pattern of shareholding is annexed to the accounts and represents the total
paid up capital of Rs. 14.400 Million. |
|
|
| BOARD
OF DIRECTORS: |
|
| Mr.
Wasim Alam Khan, resigned from the post of Chief Executive and Mr. Yusuf
Babar Khan was appointed as new Chief |
|
| Executive
of the Company in June 2000. Mr. Nasim Alam Khan, Chairman and founder
Director, resigned and Mr. Wassim |
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| Alam
Khan, Director was appointed as Chairman, on September 06, 2000. Mr. Sheikh
Ajaz Majid was appointed Director in |
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| place
of Mr. Nasim Alam Khan, Mr. Abdul Qadir H. Moochhala, resigned and Mr.
Muhammad Saeed was appointed as |
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| Director
in his place on September 06, 2000. |
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|
| AUDITORS: |
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| The
retiring Auditors Messrs Ford, Rhodes, Robson, Morrow, Chartered accountants
being eligible, offer themselves for re- |
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| appointment
at existing remuneration. |
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|
| NO
OF EMPLOYEES: |
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| The
company employed 137 (1999: 249) employees at the end of the year. |
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| LABOUR
RELATIONS: |
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| As usual. |
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|
Yusuf Babar Khan |
|
Wassim Alam Khan |
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|
Managing Director/Chief Executive |
|
Chairman |
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| Karachi |
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| Dated:
September 06, 2000 |
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| AUDITORS'
REPORT TO THE MEMBERS |
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| We
have audited the annexed balance sheet of BUXLY PAINTS
LIMITED as at June 30, 2000 |
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| and
the related profit and loss account and 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 |
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| 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; |
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|
|
|
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| (b)
in our opinion: |
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|
|
| (i)
the balance sheet and profit and loss account together with the notes |
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| thereon
have been drawn up in conformity with the Companies |
|
| Ordinance,
1984 and are in agreement with the books of account and are |
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| further
in accordance with accounting policies consistently applied; |
|
|
| (ii)
the expenditure incurred during the year was for the purpose of the |
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| company's
business; and |
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|
|
| (iii)
the business conducted, investments made and the expenditure incurred |
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| 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 statement of changes
in financial |
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| 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, |
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| 2000
and of the loss and the changes in financial position (cash flows) for the
year then |
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| ended, and |
|
|
| (a)
in our opinion no Zakat was deductible at source under the Zakat and Ushr
Ordinance, |
|
| 1980. |
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|
|
|
| Karachi - |
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|
|
Ford, Rhodes, Robson, Morrow |
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| September
06, 2000 |
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 2000 |
|
|
|
|
|
2000 |
1999 |
|
|
|
Note |
Rupees |
Rupees |
|
| ASSETS |
|
|
|
| TANGIBLE
FIXED ASSETS |
|
| Operating
assets at cost less |
|
| accumulated
depreciation |
|
3 |
23,589,729 |
24,423,587 |
|
| Capital
Work-in-progress |
|
4 |
-- |
579,049 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
23,589,729 |
25,002,636 |
|
|
|
|
| LONG
TERM DEPOSITS |
|
5 |
1,070,625 |
1,486,894 |
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Stock-in-trade |
|
|
6 |
25,327,419 |
30,510,918 |
|
| Trade debtors |
|
|
7 |
31,098,886 |
46,805,529 |
|
| Advances,
deposits, prepayments and |
|
|
| other
receivables |
|
8 |
13,240,494 |
11,686,444 |
|
| Cash
and bank balances |
|
9 |
2,834,293 |
2,776,933 |
|
|
|
|
------------------ |
------------------ |
|
|
|
72,501,092 |
91,779,824 |
|
|
|
------------------ |
------------------ |
|
| TOTAL
ASSETS |
|
97,161,446 |
118,269,354 |
|
|
|
========== |
========== |
|
|
|
|
| EQUITY
AND LIABILITIES |
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
| Authorised |
|
|
| 5,000,000
ordinary shares of Rs 10 each |
|
50,000,000 |
50,000,000 |
|
|
|
|
========== |
========== |
|
| Issued.
subscribed and paid-up |
|
10 |
14,400,000 |
14,400,000 |
|
| Revenue
reserve |
|
11 |
(14,859,908) |
(2,048,775) |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(459,908) |
12,351,225 |
|
| SURPLUS
ON REVALUATION OF FIXED ASSETS |
12 |
24,339,024 |
25,060,268 |
|
| LONG
TERM DEPOSITS |
|
13 |
525,000 |
528,000 |
|
|
|
|
|
|
|
| DEFERRED
LIABILITIES |
|
| Staff gratuity |
|
|
3,913,203 |
5,643,485 |
|
| Directors
retirement benefits |
|
300,000 |
300,000 |
|
|
------------------ |
------------------ |
|
|
|
4,213,203 |
5,943,485 |
|
| LIABILITIES
AGAINST ASSETS SUBJECT TO FINANCE LEASE |
14 |
464,912 |
855,608 |
|
|
|
| CURRENT
LIABILITIES |
|
| Current
maturity shown under current liabilities |
14 |
413,522 |
787,763 |
|
| Short
term running finances - secured |
15 |
22,033,275 |
24,930,625 |
|
| Short
term loan - secured |
|
16 |
4,452,404 |
3,837,055 |
|
| Creditors
accrued and other liabilities |
17 |
41,077,580 |
43,869,635 |
|
| Unclaimed
dividend |
|
102,434 |
105,690 |
|
|
------------------ |
------------------ |
|
|
|
68,079,215 |
73,530,768 |
|
| CONTINGENCIES
AND COMMITMENTS |
18 |
|
|
|
|
------------------ |
------------------ |
|
| TOTAL
EQUITY AND LIABILITIES |
|
97,161,446 |
118,269,354 |
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts |
|
| The
auditors report is annexed hereto. |
|
|
|
Chief Executive |
|
Director |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
|
|
|
2000 |
1999 |
|
|
Note |
Rupees |
Rupees |
|
|
| Sales |
|
19 |
141,309,229 |
186,188,376 |
|
| Cost of sales |
|
20 |
122,098,219 |
153,294,307 |
|
|
------------------ |
------------------ |
|
| Gross profit |
|
|
19,211,010 |
32,894,069 |
|
|
| Administrative
expenses |
|
21 |
20,053,925 |
21,871,214 |
|
| Selling
expenses |
|
22 |
8,777,257 |
13,107,352 |
|
|
------------------ |
------------------ |
|
|
|
28,831,182 |
34,978,566 |
|
|
|
|
------------------ |
------------------ |
|
|
| Operating Loss |
|
|
(9,620,172) |
(2,084,497) |
|
|
| Other income |
|
23 |
2,685,953 |
544,394 |
|
| Claim
for refund of excise duty |
|
24 |
-- |
3,428,095 |
|
|
------------------ |
------------------ |
|
|
|
|
(6,934,219) |
1,887,992 |
|
| Financial
charges |
|
25 |
5,391,612 |
6,640,241 |
|
|
|
|
------------------ |
------------------ |
|
| Loss
before Taxation |
|
|
(12,325,831) |
(4,752,249) |
|
| Taxation |
|
|
|
|
| Current |
|
|
706,546 |
930,942 |
|
| Prior years |
|
|
500,000 |
-- |
|
|
------------------ |
------------------ |
|
|
|
|
1,206,546 |
930,942 |
|
|
|
|
------------------ |
------------------ |
|
| Loss
after taxation |
|
|
(13,532,377) |
(5,683,191) |
|
| Unappropriated
(Loss)/Profit brought forward |
|
(5,614,400) |
68,791 |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
Loss carried forward |
|
(19,146,777) |
(5,614,400) |
|
|
|
|
========== |
========== |
|
| BASIC
EARNINGS PER SHARE |
|
30 |
(9.40) |
(3.95) |
|
|
========== |
========== |
|
|
|
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 2000 |
|
|
|
|
2000 |
1999 |
|
|
|
Rupees |
Rupees |
|
|
| CASH
FLOWS FROM OPERATING ACTIVITIES |
|
| Loss
before taxation |
|
(12,325,831) |
(4,752,249) |
|
|
| Adjustments
for |
|
| Depreciation |
|
1,714,223 |
1,873,460 |
|
| Profit
on sale of fixed assets |
|
(1,693,959) |
-- |
|
| Provision
for retirement gratuity-net of payments |
|
(1,730,282) |
295,979 |
|
| Financial
charges on borrowings |
|
4,935,985 |
6,185,063 |
|
|
|
------------------ |
------------------ |
|
|
|
3,225,967 |
8,354,502 |
|
|
| Operating
profit before working capital changes |
|
(9,099,864) |
3,602,253 |
|
|
| Changes
in working capital |
|
| (Increase)/decrease
in current assets |
|
| Stock-in-trade |
|
|
5,183,499 |
4,602,112 |
|
| Trade debtors |
|
|
|
15,706,643 |
(7,852,932) |
|
| Advances,
deposits, prepayments and other receivables |
(197,007) |
696,100 |
|
|
| Increase
in current liabilities |
|
| Creditors,
accrued and other liabilities |
|
(3,196,626) |
10,331,278 |
|
|
------------------ |
------------------ |
|
|
|
17,496,509 |
7,776,558 |
|
|
|
------------------ |
------------------ |
|
| Cash
generated from operations |
|
8,396,645 |
11,378,811 |
|
| Taxes paid |
|
(2,563,589) |
(399,083) |
|
| Financial
charges paid |
|
(4,531,414) |
(6,274,278) |
|
|
|
------------------ |
------------------ |
|
| Net
cash from operating activities (A) |
|
1,301,642 |
4,705,450 |
|
|
|
========== |
========== |
|
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
| Sale
of fixed assets |
|
2,587,225 |
-- |
|
| Acquisition
of fixed assets |
|
(1,194,582) |
(1,171,814) |
|
| Long
term deposits |
|
416,269 |
(251,827) |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash from/(used) in investing activities (B) |
|
1,808,912 |
(1,423,641) |
|
|
========== |
========== |
|
|
| CASH
FLOWS FROM FINANCING ACTIVITIES |
|
| Long
term deposits |
|
|
(3,000) |
-- |
|
| Short
term finances |
|
|
(2,282,001) |
(1,492,722) |
|
| Finance
lease - net |
|
|
(764,937) |
(632,140) |
|
| Dividend paid |
|
|
(3,256) |
(16,894) |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash used in financing activities (c) |
|
(3,053,194) |
(2,141,756) |
|
|
========== |
========== |
|
|
|
|
| NET
INCREASE IN CASH AND CASH |
|
57,360 |
1,140,053 |
|
| EQUIVALENTS
(A+B+C) |
|
|
|
| CASH
AND CASH EQUIVALENTS AT THE BEGINNING |
|
| OF THE YEAR |
|
|
2,776,933 |
1,636,880 |
|
|
|
|
------------------ |
------------------ |
|
| CASH
AND CASH EQUIVALENTS AT THE END OF THE YEAR |
2,834,293 |
2,776,933 |
|
|
|
|
========== |
========== |
|
|
|
|
|
Chief Executive |
|
Director |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
| 1.
THE COMPANY AND ITS OPERATIONS |
|
| Buxly
Paints Limited was incorporated on April 08,1954 in Pakistan and is quoted on
the Stock Exchanges in |
|
| Pakistan.
The company is a manufacturer of paints, pigments, protective surface
coatings, varnishes and other |
|
| related
products. |
|
|
| 2.
SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
| (a)
Accounting convention |
|
|
| These
accounts have been prepared under the historical cost convention modified by
the revaluation of certain |
|
| fixed assets. |
|
|
|
|
| (b) Fixed assets |
|
|
|
|
|
|
|
| Owned |
|
|
|
| These
are stated at cost or applicable valuation less accumulated depreciation.
Depreciation is charged to |
|
| income
applying the reducing balance method and the rates used are stated in note 3
to the accounts. |
|
| Leasehold
land is amortized over the remaining period of the lease. In respect of
additions during the year, |
|
| depreciation
is charged for full year, however, no depreciation is charged in the year of
disposal. |
|
|
|
|
| Maintenance
and normal repairs are charged to income as and when incurred. Major renewals
and improve- |
|
| ments
are capitalised. Profit or loss on disposal of assets is included in income
currently. |
|
|
| Leased |
|
| Assets
subject to finance leases are included as tangible fixed assets at cost less
accumulated depreciation. |
|
|
| The
outstanding obligations under the leases less financial charges allocated to
future periods are shown as |
|
| liability. |
|
|
| Depreciation
is charged at the same rates as company owned assets. |
|
|
| (c)
Stock-in-trade |
|
| These
are valued at the lower of cost, determined on first-in-first- out method or
net realizable value, except for |
|
| those
in transit which are valued at cost. |
|
|
| (d)
Bad and doubtful debts |
|
|
|
| Known
bad debts are written off and provision is made for debts considered
doubtful. |
|
|
| (e)
Retirement benefits |
|
|
|
| i) Staff gratuity |
|
| The
company operates an approved gratuity fund scheme and provision in respect
thereto are made in accor- |
|
| dance
with the recommendations of the actuary. |
|
|
|
| ii)
Provident fund |
|
|
| The
company also operates an approved provident fund scheme and contributions
thereto are made in accor- |
|
| dance
with the terms of the scheme. |
|
|
| (f) Taxation |
|
|
|
| Provision
for current taxation is based on taxable income at the current rates of
taxation after taking into |
|
| account
tax credits available or 0.5% of turnover u/s 80(d) of Income tax Ordinance
1979, whichever is higher. |
|
| The
company accounts for deferred taxation on all significant timing differences
using the liability method. As |
|
| a
measure of prudence deferred tax debits are not accounted for. |
|
|
| (g)
Foreign currency |
|
| Assets
and liabilities in foreign currency are stated in rupees at the rates of
exchange ruling on the balance |
|
| sheet
date or rates of exchange fixed under contractual arrangements. All exchange
differences are included |
|
| in
the profit and loss account. |
|
|
|
|
| (h)
Revenue recognition |
|
|
| Sales
are recorded on despatch of goods to customers. |
|
|
| 3.
TANGIBLE FIXED ASSETS |
|
|
|
|
|
|
|
COST/REVALUATION |
|
|
DEPRECIATION |
|
|
|
|
|
|
Disposals/ |
|
|
|
Written |
|
|
As at |
Additions |
Adjustments |
As at |
|
As at |
|
As at |
down value |
