| Ghandhara Industries Limited |
|
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|
| Annual
Report 2000 |
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|
| CONTENTS |
|
|
| BOARD
OF DIRECTORS |
|
|
| NOTICE
OF MEETING |
|
|
| ABOUT
THE COMPANY |
|
|
| REPORT
OF THE DIRECTORS |
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
| BALANCE
SHEET |
|
|
| PROFIT
AND LOSS ACCOUNT |
|
|
| CASH
FLOW STATEMENT |
|
|
| NOTES
TO THE ACCOUNTS |
|
|
| PATTERN
OF SHAREHOLDINGS |
|
| SUBSIDIARY
COMPANY: |
|
| MARGHZAR
INDUSTRIES (PRIVATE) LIMITED |
|
|
|
|
| CONSOLIDATED
FINANCIAL STATEMENTS |
|
| -- AUDITORS' REPORT TO THE
MEMBERS |
|
| -- BALANCE SHEET |
|
|
| -- PROFIT AND LOSS ACCOUNT |
|
| -- CASH FLOW STATEMENT |
|
|
| -- NOTES TO THE ACCOUNTS |
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| BOARD
OF DIRECTORS |
|
|
| Mr.
Raza Kuli Khan Khattak |
Chairman |
|
| Mr.
Ahmad Kuli Khan Khattak |
Chief Executive |
|
| Mr. M. R. Banka |
|
Managing Director |
|
| Dr.
Parvez Hassan |
|
| Mr.
Mushtaq Ahmad Khan |
|
| Col.
(R) S. Tayyab Ahmad |
|
| Col.
(R) Abdul Majid Tareen |
|
| Mr.
Muhammad Javed Parwaz |
|
| Mr.
Minhajuddin Sheikh |
|
|
| SECRETARY |
|
| Mr. M.R. Banka |
|
|
| AUDITORS |
|
| Hameed
Chaudhri & Co. |
|
| Chartered
Accountants |
|
|
| LEGAL
ADVISORS |
|
| Syed
Iqbal Ahmed Barrister at law |
|
| Jawaid
Law Associates (Tax) |
|
| Syed
Qamruddin Hassan |
|
|
| BANKERS |
|
| National
Bank of Pakistan |
|
| Habib
Bank Limited |
|
| United
Bank Ltd. |
|
| Allied
Bank of Pakistan Ltd. |
|
| Muslim
Commercial Bank Ltd. |
|
| Indus Bank Ltd. |
|
| Mashraq Bank |
|
|
| REGISTERED
OFFICE |
|
| Hub
Chowki Road |
|
| S.I.T.E, |
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| Post
Box No. 2706 |
|
| Karachi-75730 |
|
|
|
| NOTICE
OF MEETING |
|
|
| Notice
is hereby given that the 37th Annual General Meeting of the Company will be
held on Saturday, the |
|
| 30th
December, 2000 at 09.00 A.M. at Ghandhara Industries Limited Hub Chauki Road,
S.I.T.E., Karachi to |
|
| transact
the following business:- |
|
|
| To
confirm the minutes of the Extra Ordinary General Meeting held on 10th April
2000. |
|
|
| To
receive and adopt the audited accounts of the Company for the year ended June
30, 2000 |
|
| together
with Directors and Auditors reports thereon. |
|
|
| To
appoint auditors for the next financial year and fix their remuneration. |
|
|
| To
Fix the remunerations of three working Directors. |
|
|
| To
transact any other ordinary business of the Company with the permission of
the Chair. |
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|
By Order of the Board |
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|
M. R. BANKA |
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| KARACHI:
December 07, 2000 |
|
SECRETARY |
|
|
| Note: |
|
| 1.
The Share Transfer Books of the Company will remain closed from December 21,
2000 to December |
|
| 31,
2000 both days inclusive. |
|
|
| 2.
A member entitled to attend and vote at this meeting may appoint another
member as his/her |
|
| proxy
to attend the meeting and vote for him/her. Proxies in order to be effective
must be received |
|
| by
the Company not less than 48 hours before the meeting. |
|
|
| 3.
Members are requested to promptly notify the Company of any change in their
addresses. |
|
|
| THE
COMPANY |
|
| The
Ghandhara Industries Limited is a public limited company quoted on the Stock
Exchanges and regis- |
|
| tered
under the Companies Act, 1913 (now Companies Ordinance, 1984). It was
established in Karachi by |
|
| General
Motors Overseas Distribution Corporation of U.S.A. In 1963 Lt. Gen. (Rtd.) M.
Habibullah Khan |
|
| Khattak
acquired these facilities from General Motors and renamed it Ghandhara
Industries Limited. The |
|
| Government
of Pakistan nationalized Ghandhara Industries Limited in 1972 and renamed it
National |
|
| Motors
Limited. In 1992 M/s. Bibojee Services (Pvt) Ltd. acquired it under the
Privatization Policy of the |
|
| Government,
and adopted its original name Ghandhara Industries Limited w.e.f. 27.11.1999. |
|
|
| The
major business activities of the company comprise of progressive manufacture,
assembly and marketing |
|
| of
Isuzu truck and bus chassis and fabrication of Bus and Load bodies. In order
to utilize idle plant |
|
| capacity
the company has plans for the assembly of Cars, Vans, Pick-ups and Light
commercial vehicles in |
|
| addition
to standard Isuzu trucks and buses. To accomplish its mission the company has
a country-wise |
|
| dealers
net work for marketing its products. In addition the company represents its
principals in Pakistan |
|
| for
other built up products. |
|
|
| The
company has provided impetus to the local manufacture of engineering goods.
With the introduction |
|
| of
new models that compliments the Isuzu products, additional opportunities are
being availed to provide |
|
| work
for the company's in house manufacturing facilities as well as for the
vendors producing Isuzu parts |
|
| locally. |
|
|
| In-house
facilities also include two assembly lines, a machine shop and a press shop.
Equipped with these |
|
| facilities
the plant is capable of producing about 2400 truck & bus chassis and 2400
LCVs per annum on a |
|
| single
shift basis, depending on the business requirements. Other avenues are also
being explored to utilise |
|
| the
idle capacity of the plant as far as possible. |
|
|
| LONG
-- TERM OBJECTIVES |
|
| -
Maximize the value of shareholders equity. |
|
| -
Create an environment that assures national self-sufficiency in automobile
industry. |
|
| -
Create an environment that furthers healthy competition in the Automobile
sector. |
|
|
| MAJOR
PRODUCTS |
|
| -
Isuzu Truck Model FTR |
|
| - Isuzu Truck Model FVR/FVM |
|
| - Isuzu Truck Model NPR |
|
| - Isuzu
Bus Model MT |
|
| -
Isuzu Light Commercial Vehicles - KB Series |
|
| - Isuzu Bus / Load Body
Fabrication |
|
|
| MAJOR
CUSTOMERS |
|
| -
Owner Operators |
|
| - Fleet Owners |
|
| -
Pakistan Armed Forces |
|
| -
Civilian and Paramilitary Law Enforcement Agencies |
|
| -
Government & Semi-Government Organizations |
|
| - Transport Authorities |
|
| - Educational Institutions |
|
| - Health Organizations |
|
| - Public Sector Companies |
|
| -
General Public |
|
|
|
| REPORT
OF THE DIRECTORS |
|
|
| The
Directors of your Company present their 37th Annual Report with audited
accounts of the Company |
|
| together
with auditors' report thereon for the year ended June 30, 2000 |
|
|
| FINANCIAL
RESULTS |
|
| The
financial results for the year ended June 30, 2000 are summarized below: |
|
|
|
|
(Rs. in 000) |
|
|
| Loss
for the year |
|
|
(88,437) |
|
| Taxation |
|
|
|
(848) |
|
|
|
|
|
------------------ |
|
| Loss
for the year after taxation |
|
|
(89,285) |
|
| Accumulated
loss brought forward |
|
(946,667) |
|
|
|
|
|
------------------ |
|
| Accumulated
loss carried forward |
|
|
(1,035,952) |
|
|
========== |
|
|
| BASIS
OF ACCOUNTS |
|
| The
company has incurred a loss of Rs. 89.285 million during the year and its
current liabilities at the date |
|
| exceed
its current assets by Rs. 895.644 million. The losses are mainly due to
financial expenses and |
|
| under
utilisation of plant capacity. |
|
|
| The
Bankers Committee for revival of sick units considered the case of the
company on 3rd July, 1999 and |
|
| decided
as under |
|
|
|
|
Rupees |
|
|
|
|
in millions |
|
|
|
| Relief
against outstanding liabilities (approx) |
|
228 |
|
|
|
|
========== |
|
| Adjustment
of amount already paid |
|
30 |
|
| To
be paid through sale of properties |
|
390 |
|
| To
be paid in 20 quarterly installments with effect from 1 July. |
|
| 2000
with mark up @ paisa 39 per 1000 per day |
|
100 |
|
|
------------------ |
|
|
|
520 |
|
|
========== |
|
|
| Under
the terms of the package the company was required to submit personal
guarantees of all the directors |
|
| and
original property documents of four properties owned. On the request of the
company the requirement |
|
| of
submission of personal guarantees was waived and the company deposited
property documents |
|
| in
respect of two properties. The documents of other two properties could not be
submitted as these were |
|
| held
by another bank against credit facilities extended to the company. Meanwhile
all banks who were |
|
| otherwise
required to implement the above package through court decrees, have filed
cases against the |
|
| company
for recovery of loans amounts plus markup and damages. The details of suits
filed by the banks and |
|
| status
of cases are as under: |
|
|
|
| Name of bank |
|
Amount of |
Status of the case |
|
|
|
suit filed |
|
|
|
|
Rs. In millions |
|
|
|
| United
Bank Limited |
100.04 |
Amount decreed for Rs.
60.822 million plus mark |
|
|
|
|
up @ Paisa 60 per 1000
per day. |
|
|
|
|
| Allied
Bank of Pakistan |
240.36 |
Amount decreed for Rs.
98.668 million plus mark |
|
|
|
|
up @ 17.5 per cent per
annum. |
|
|
|
|
| Habib
Bank Limited |
414.26 |
At concluding stage. |
|
|
|
|
|
| National
Bank of Pakistan |
322.52 |
At concluding stage. |
|
|
|
|
| Based
on the decision in the case of United Bank Limited the company expects there
would be substantial |
|
| savings
in interest/markup when all decrees are finalized and implemented. |
|
|
| FUTURE
OUTLOOK |
|
| The
Management of the company is constantly striving to turn around the Company.
In order to utilize idle |
|
| capacity
of the plant the Company has entered into agreements with two companies
holding foreign fran- |
|
| chises
for the assembly of their vehicles and tractors at its plant. |
|
|
| One
agreement is for the assembly of light commercial vehicles and another is for
assembly of tractors. The |
|
| assembly
work will hopefully be in place in first quarter of 2001. Assembly of these
vehicles ,will result in |
|
| utilization
of additional capacity. The increased volumes will generate additional
revenues. |
|
|
| Keeping
in, view the above facts, it is hoped that the company will continue as a
going concern. |
|
|
|
| AUDITORS |
|
| The
present auditors M/s. Hameed Choudhri & Co. retire and being eligible
have offered themselves for |
|
| appointment
as auditors for the year 2000-2001. |
|
|
| PATTERN
OF SHARE HOLDING |
|
| The
pattern of Shareholding as at June 30, 2000 is annexed. |
|
|
|
|
On behalf of the Board |
|
|
|
|
|
|
|
|
AHMAD KULI KHAN KHATTAK |
|
| December
07, 2000 |
|
|
Chief Executive |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed Balance Sheet of GHANDHARA INDUSTRIES LIMITED
formerly National |
|
| Motors
Limited as at 30 June, 2000, and the related Profit and Loss Account, Cash
Flow Statement and state- |
|
| ment
of changes in equity, 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. |
|
|
| It
is the responsibility of the company's management to establish and maintain a
system of internal control |
|
| and
prepare and present the above said statements in conformity with the approved
accounting standards |
|
| and
the requirements of the Companies Ordinance, 1984. Our responsibility is to
express an opinion on |
|
| these
statements based on our audit. |
|
|
| We
Conducted our audit in accordance with the auditing standards as applicable
in Pakistan. These stan- |
|
| dards
require that we plan and perform the audit to obtain reasonable assurance
about whether the above |
|
| said
statements are free of any material misstatement. An audit includes
examining, on a test basis, evidence |
|
| supporting
the amount and disclosures in the above said statements. An audit also
includes assessing |
|
| the
accounting policies and significant estimates made by management, as well as,
evaluating the over- |
|
| all
presentation of the above said statements. We believe that our audit provides
a reasonable basis for our |
|
| opinion
and., after due verification, 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 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, cash flow statement and statement of changes
in equity, 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 June, 2000 and of the Loss, its cash flows and
changes in equity for |
|
| the
year then ended; and |
|
|
|
|
|
|
| (d)
in our opinion, no Zakat was deductible at source under Zakat and Ushr
Ordinance, 1980 |
|
|
|
|
| (e)
without qualifying our opinion we draw attention to note 1 to the financial
statements. The company |
|
| has
incurred a net loss of Rs. 89.285 million during the year ended 30 June 2000
and, as of that |
|
| date,
the Company's current liabilities exceeded its current assets by Rs. 895.644
million and its and |
|
| liabilities
exceeded its total assets by Rs. 204.648 million. However, the financial
statements have |
|
| been
prepared under going concern assumption in view of the matters. |
|
|
| December
07, 2000 |
|
|
HAMEED CHAUDHRI & CO., |
|
| KARACHI |
|
|
|
CHARTERED ACCOUNTANTS |
|
|
|
|
|
| BALANCE
SHEET AS AT 30 JUNE 2000 |
|
|
|
|
Note |
2000 |
1999 |
|
|
|
(Rupees
'000) |
|
|
| SHARE
CAPITAL & RESERVES |
|
|
| Authorised
Capital |
|
|
| 10,000,000
ordinary shares of Rs. 10/- each |
|
100,000 |
100,000 |
|
|
|
|
========== |
========== |
|
|
|
|
|
| Issued,
subscribed & paid up capital |
3 |
65,553 |
65,553 |
|
| Reserves |
|
|
|
| Capital reserves |
|
4 |
40,800 |
40,800 |
|
| Revenue
reserve |
|
|
2,400 |
2,400 |
|
| Accumulated
loss |
|
|
(1,035,952) |
(946,667) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(992,752) |
(903,467) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(927,199) |
(837,914) |
|
|
| SURPLUS
ON REVALUATION OF FIXED ASSETS |
722,552 |
723,364 |
|
|
|
| LONG
TERM LOANS & DEFERRED LIABILITY |
|
|
| Long
term loans - unsecured |
|
5 |
-- |
9,197 |
|
|
|
|
|
|
|
| DEFERRED
LIABILITY |
|
|
|
|
| Provision
for staff retirement gratuity |
|
8,868 |
8,755 |
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Current
portion of long term loans |
|
21,197 |
22,081 |
|
| Short
term loan/running finances and borrowings |
6 |
472,797 |
558,910 |
|
| Creditors,
accrued & other liabilities |
7 |
610,532 |
447,206 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
1,104,526 |
1,028,197 |
|
| CONTINGENT
LIABILITIES |
|
8 |
------------------ |
------------------ |
|
|
|
|
908,747 |
931,599 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| The
annexed notes form an integral part of these accounts |
|
|
| TANGIBLE
FIXED ASSETS |
|
| Operating
fixed assets |
|
9 |
307,290 |
315,989 |
|
| Capital
work in progress |
|
|
320 |
320 |
|
|
|
|
| LONG
TERM INVESTMENTS |
|
|
|
| Investments
in subsidiary & other companies |
10 |
1,401 |
1,401 |
|
| Investment
in immovable properties |
11 |
388,331 |
389,567 |
|
|
------------------ |
------------------ |
|
|
|
|
389,732 |
390,968 |
|
| LONG
TERM LOANS AND ADVANCES |
12 |
13 |
13 |
|
|
|
| LONG
TERM DEPOSITS & DEFERRED COSTS |
|
| Deposits |
|
|
488 |
490 |
|
| Deferred costs |
|
13 |
2,022 |
4,045 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
2,510 |
4,535 |
|
| CURRENT
ASSETS |
|
|
|
| Stores,
spares & tools |
|
14 |
1,396 |
1,586 |
|
| Stock in trade |
|
15 |
172,166 |
116,331 |
|
| Trade debts |
|
16 |
12,242 |
17,677 |
|
| Loans,
advances, deposits & prepayments |
17 |
8,651 |
21,378 |
|
| Other
receivables |
|
18 |
8,624 |
10,046 |
|
| Cash
and bank balances |
|
19 |
5,803 |
52,756 |
|
|
------------------ |
------------------ |
|
|
|
208,882 |
219,774 |
|
|
|
------------------ |
------------------ |
|
|
|
908,747 |
931,599 |
|
|
|
========== |
========== |
|
|
|
M. Javed Parwaz |
|
AHMAD KULI KHAN KHATTAK |
|
|
Director |
|
Chief Executive |
|
|
|
| PROFIT
& LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED 30 JUNE 2000 |
|
|
|
|
Note |
2000 |
1999 |
|
|
|
|
(Rupees
'000) |
|
|
|
| Net sales |
|
20 |
169,178 |
223,362 |
|
| Cost of sales |
|
21 |
176,669 |
217,888 |
|
|
|
------------------ |
------------------ |
|
| Gross
profit/(Loss) |
|
|
(7,491) |
5,474 |
|
| Administration
and selling expenses |
22 |
(19,247) |
(17,853) |
|
|
|
|
------------------ |
------------------ |
|
| Operating loss |
|
|
(26,738) |
(12,379) |
|
| Other income |
|
23 |
3,024 |
1,946 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(23,714) |
(10,433) |
|
|
|
|
------------------ |
------------------ |
|
| Other expenses |
|
24 |
-- |
(8,090) |
|
| Financial
and other charges |
|
25 |
(64,723) |
(33,850) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(64,723) |
(41,940) |
|
|
|
------------------ |
------------------ |
|
| Loss
before taxation |
|
|
(88,437) |
(52,373) |
|
| Taxation |
|
26 |
(848) |
(1,114) |
|
|
|
|
------------------ |
------------------ |
|
| Loss
after taxation |
|
|
(89,285) |
(53,487) |
|
| Accumulated
loss brought forward |
|
(946,667) |
(893,180) |
|
|
|
|
------------------ |
------------------ |
|
| Accumulated
loss carried forward |
|
|
(1,035,952) |
(946,667) |
|
|
|
|
------------------ |
------------------ |
|
| Loss per share |
|
32 |
(13.62) |
(8.16) |
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
M. Javed Parwaz |
|
AHMAD KULI KHAN KHATTAK |
|
|
Director |
|
Chief Executive |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED 30 JUNE 2000 |
|
|
|
Note |
2000 |
1999 |
|
|
|
(Rupees
'000) |
|
|
| Cash
flow from operating activities |
|
|
| Cash
generated from/used in operations |
27 |
49,893 |
16,369 |
|
| Staff gratuity |
|
|
(532) |
(591) |
|
| Interest paid |
|
|
(12,517) |
(24,655) |
|
| Taxes paid |
|
|
(222) |
(229) |
|
| Long-term
loans and advances |
|
|
-- |
2 |
|
|
|
|
------------------ |
------------------ |
|
| Net
Cash inflow/(out-flow) from operating activities |
(36,622) |
(9,104) |
|
|
| Cash
flow from investing activities |
|
| Fixed
capital expenditure |
|
|
(87) |
(905) |
|
| Capital
work in progress |
|
|
-- |
(266) |
|
| Sale
proceeds of fixed assets |
|
|
796 |
1,627 |
|
| Interest
received |
|
|
38 |
577 |
|
| Deposits |
|
|
2 |
3 |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash inflow from investing activities |
|
749 |
1,036 |
|
|
|
|
------------------ |
------------------ |
|
| Cash
inflow/(out-flow) before financing activities |
|
37,371 |
(8,068) |
|
| Financing
Activities |
|
|
-- |
-- |
|
|
|
|
------------------ |
------------------ |
|
| Net
increase/(decrease) in cash and cash equivalents |
37,371 |
(8,068) |
|
|
|
|
| Cash
and cash equivalents at beginning of the year |
(506,154) |
(489,996) |
|
| Exchange
difference |
|
|
1,789 |
(8,090) |
|
|
|
|
------------------ |
------------------ |
|
| Cash
and cash equivalents at end of the year |
28 |
(466,994) |
(506,154) |
|
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
M. Javed Parwaz |
|
AHMAD KULI KHAN KHATTAK |
|
|
Director |
|
Chief Executive |
|
|
|
| NOTES
TO THE ACCO |
