| Pioneer Cables Limited |
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| Annual
Report 2000 |
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| CONTENTS |
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| Company
Profile |
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| Notice
of Meeting |
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| Chairman's
Review |
|
| Directors'
Report |
|
| Pattern
of Shareholdings |
|
| 10
Years at a Glance |
|
| Auditors'
Report |
|
| Balance Sheet |
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|
| Profit
and Loss Account |
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| Cash
Flow Statement |
|
| Notes
to the Accounts |
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|
|
| COMPANY
PROFILE |
|
|
| Board
of Directors |
Mr. Said Ahmed (Chairman) |
|
|
Mr. Rashid Zakaria Bawany
(Chief Executive) |
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|
Mr. Zakaria A. Bawany |
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|
Mrs. Mobina A. Dada |
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|
Mr. Zahid Zaheer |
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|
Dr. Amjad Waheed (Nominee
of N.I.T.) |
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|
Ms. Aaliya K. Dossa
(Nominee of N.I.T.) |
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| Company
Secretary |
Mr. Asif A. Sattar |
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| Chief
Accountant |
Mr. Vali Muhammad A.
Rehman |
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| Legal Adviser |
|
Mr. Rao M. Shakir
Naqshbandi |
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|
Advocate |
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| Bankers |
|
Bank A1-Habib Ltd. |
|
|
Muslim Commercial Bank
Ltd. |
|
|
Bank A1-Falah Ltd. |
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|
Albaraka Islamic Bank
B.S.C. (E.C.) |
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|
| Auditors |
|
Rahim Iqbal Rafiq &
Co. |
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|
Chartered Accountants |
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| Registered
Office |
27//3/1, Mauza Bairut, |
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|
Main RCD Highway, Hub
Chowki, |
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|
Distt: Lasbela,
Balochistan. |
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|
Phones: 0202 - 32360,
0202 - 33679 |
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|
Fax: 0202 - 32369 |
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| Head
/ Sales Office |
1001-Uni Towers, |
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|
I.I.Chundrigar Road,
P.O.Box 6643, |
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|
Karachi - 74000,
Pakistan. |
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Phones: 2416511-14,
2410553, 2413528 |
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Fax: (92-21) 2415815,
(92-21) 2411804 |
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E-Mail:
pioneer@bawany.com |
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WEBSITE:
http://www.bawany. com |
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| Lahore Office |
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24/25 Associated
Chambers, Patiala Ground, |
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|
Link Mcleod Road, Lahore. |
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Phones: (042) 7235741 -43 |
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Fax: (042) 7235712 |
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| Islamabad
Office |
Abbas Centre, Room No.12, |
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|
3rd Floor, 87 West Blue
Area, Islamabad. |
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|
Tel/Fax: (92-51) 2822915 |
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Mobile: 0303-7775553,
0303-7356342 |
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| NOTICE
OF MEETING |
|
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| Notice
is hereby given that the Twentieth Annual General Meeting of the Shareholders
of Pioneer |
|
| Cables
Limited will be held on Thursday the 21st December, 2000 at 3.00 p.m at the
Liaison Office of |
|
| the
Company at Uni Towers, 10th Floor, Room No. 1001, I. I. Chundrigar Road,
Karachi to transact |
|
| the
following business: |
|
|
| 1.
To confirm the minutes of Nineteenth Annual General Meeting held on Monday
the 27th |
|
| December,
1999. |
|
|
| 2.
To receive, consider and adopt the Statement of Accounts for the year ended
June 30, 2000 |
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| together
with the Reports of the Directors and Auditors thereon. |
|
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| 3.
To approve cash dividend as recommended by the Directors. |
|
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| 4.
To appoint Auditors for the ensuing year and to fix their remuneration.
Messrs. Rahim Iqbal |
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| Rafiq
& Co, Chartered Accountants, retire and being eligible, have offered
themselves for |
|
| re-appointment. |
|
|
| 5.
To transact any other business which may legally be transacted at an Annual
General Meeting |
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| with
the permission of the Chair. |
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|
|
By Order of the Board |
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|
ASIF A. SATTAR |
|
| Karachi:
November 14, 2000 |
|
Company Secretary |
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|
| Notes: |
|
| 1.
The Share Transfer Books of the Company will be closed from 21st December,
2000 to 2nd |
|
| January,
2001 (both days inclusive).Transfers received in order at the Shares
Department of |
|
| the
Company at Uni Towers, 10th Floor, Room No. 1001, I.I. Chundrigar Road,
Karachi by |
|
| close
of business on 20th December, 2000 will be treated in time. |
|
|
| 2.
A member entitled to attend and vote at the General Meeting is entitled to
appoint another |
|
| member
as his/her proxy to attend and vote on his/her behalf. |
|
|
| 3.
The instrument appointing a proxy, together with the power of attorney under
which it is |
|
| signed
or a notarially certified copy thereof, should be deposited at the Liaison
Office/ |
|
| Shares
Department of the Company not less than 48 hours before the time of holding
of the |
|
| meeting. |
|
|
| 4.
The members are requested to advise the change in address, if any. |
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|
| CHAIRMAN'S
REVIEW |
|
|
| Dear
Shareholders |
|
| On
behalf of the Board, it gives me great pleasure to welcome you to the 20th
Annual General |
|
| Meeting
of the Company. |
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|
| Company's
Performance: |
|
| In
the six monthly statement in February this year, I had predicted that the
results of the second |
|
| half
of the year will be an improvement over the first half. This has indeed
happened and the |
|
| sales
for the second half of the year are 40% more than the first half. The
operating profit for |
|
| the
second half of the year is almost twice than that of the first half. |
|
|
| On
an annual basis, the sales for the whole year at Rs. 306 million are
considerably more than |
|
| the
Rs. 239 million achieved last year. The operating profit for the whole year
at Rs. 11.387 |
|
| million
is substantially greater than the Rs. 7.0 million achieved last year. The
administration |
|
| and
selling expenses have been contained at last year's level. The financial
charges are almost |
|
| half
of those incurred in the previous year. |
|
|
| But
for the need to provide Rs. 4.62 million for doubtful debts, the profit
before tax for the year |
|
| would
have been Rs. 7.83 million. Although the Company has been able to get a
decree from |
|
| the
Courts for this outstanding debt against a public quoted company, it could
not be recovered |
|
| as
none of the assets of this company were free from encumbrances. Your
Directors have |
|
| therefore
felt it prudent to provide for this doubtful debt and charge it against the
year's profit. |
|
|
| Provision
has not been made in the accounts for an overdue debt of another Rs. 6.378
million, |
|
| which
is also overdue since 1995 and relates to supplies made to yet another public
company. |
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| The
legal proceedings for the recovery of this amount have been instituted and
have resulted |
|
| in
arbitration. The Company expects to get a favourable arbitration award and
therefore no |
|
| provision
has been made for this amount in the accounts. |
|
|
| Had
this provision been made the entire profit for the year would have been wiped
out and |
|
| resulted
in a pretax loss of Rs. 3.173 million. |
|
|
| Despite
very low profitability of Rs. 3.205 million your Company has had to suffer a
minimum |
|
| turnover
tax of Rs. 1.543 million, leaving a surplus after taxation of Rs. 1.602
million only. |
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|
| Dividend: |
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| Your
Directors propose not to draw down the reserve any further but to pay out all
the earnings |
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| for
the year. Hence a dividend of 41/2 % is being proposed |
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| Meanwhile
we must await better times for the investment environment in the Country to |
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| improve
further. When this happens your Company will not be found lacking in its
effort to |
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| secure
the additional orders so badly needed. |
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|
| Staff
& Customers: |
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| Our
relationship with the employees at all level remains satisfactory. |
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| To
our valued customers, our message is that we appreciate their support and the
confidence |
|
| they
have reposed in us. |
|
|
|
SAID AHMED |
|
| Karachi:
November 14, 2000 |
|
Chairman |
|
|
|
| DIRECTORS'
REPORT |
|
|
| Your
Directors are pleased to submit 20th Annual Report and 17th since the Company
was listed on |
|
| Stock
Exchange of Pakistan, alongwith audited accounts for the year ended June 30,
2000 and the |
|
| Auditors
Report thereon: |
|
|
| The
operating results of your Company are summarised below: |
|
|
June 30, 2000 |
June 30, 1999 |
|
|
Rupees |
Rupees |
|
|
| Profit/(loss)
before taxation |
|
7,827,432 |
(87,860) |
|
| Provision
for doubtful debts |
|
(4,621,711) |
-- |
|
| Taxation |
|
|
|
| Current |
|
(1,543,619) |
(1,202,465) |
|
| Prior |
|
(59,780) |
-- |
|
|
------------- |
------------- |
|
|
(1,603,399) |
(1,202,465) |
|
| Profit
/ (loss) after taxation |
|
1,602,322 |
(1,290,325) |
|
| Balance
brought forward from last year |
|
(31,456,967) |
(30,167,892) |
|
| Transfer
from General reserve |
|
-- |
1,775,000 |
|
| Proposed
dividend @41/2% (1999: 5%) |
|
(1,596,375) |
(1,773,750) |
|
| Unappropriated
balance carried forward |
|
(31,451,020) |
(31,456,967) |
|
|
| The
present Auditors M/s. Rahim Iqbal Rafiq & Co., Chartered Accountants
retire and offer themselves |
|
| for
re-appointment. |
|
|
| The
Chairman's Review covering the significant activities of the Company is
provided with this Annual |
|
| Report. |
|
|
| The
pattern of shareholdings is annexed. |
|
|
|
On behalf of the Board |
|
|
|
RASHID ZAKARIA BAWANY |
|
| Karachi:
November 14, 2000 |
|
Chief Executive |
|
|
|
|
| PATTERN
OF SHAREHOLDING |
|
| AS
AT JUNE 30, 2000 |
|
|
| NO OF |
|
TOTAL SHARES |
|
| SHAREHOLDERS |
SHAREHOLDING |
|
HELD |
|
| 250 |
1 |
to |
100 |
7,163 |
|
| 258 |
101 |
to |
500 |
50,465 |
|
| 73 |
501 |
to |
1,000 |
48,323 |
|
| 121 |
1,001 |
to |
5,000 |
225,694 |
|
| 13 |
5,001 |
to |
10,000 |
84,799 |
|
| 4 |
10,001 |
to |
15,000 |
48,915 |
|
| 4 |
15,001 |
to |
20,000 |
68,469 |
|
| 2 |
20,001 |
to |
25000 |
48,650 |
|
| 2 |
25,001 |
to |
30000 |
53,362 |
|
| 1 |
35,001 |
to |
40000 |
35,561 |
|
| 2 |
55,001 |
to |
60000 |
117,642 |
|
| 2 |
60,001 |
to |
65000 |
125,345 |
|
| 2 |
90,001 |
to |
95000 |
184,243 |
|
| 1 |
105,001 |
to |
110000 |
106,048 |
|
| 1 |
110,001 |
to |
115,000 |
112,821 |
|
| 1 |
130,001 |
to |
135000 |
130,429 |
|
| 1 |
150,001 |
to |
155,000 |
153,186 |
|
| 1 |
155,001 |
to |
160,000 |
156,197 |
|
| 1 |
235,001 |
to |
240,000 |
237,988 |
|
| 1 |
460,001 |
to |
465,000 |
464,021 |
|
| 1 |
1,085,001 |
to |
1,090,000 |
1,088,179 |
|
| ---------- |
|
---------- |
|
| 742 |
|
3,547,500 |
|
| ========== |
|
========== |
|
|
|
|
|
| CATEGORIES
OF SHAREHOLDERS |
|
| Categories |
|
Number |
Shares held |
Percentage |
|
|
| Individuals |
|
726 |
1,486,846 |
41.91 |
|
| Investment
Companies |
3 |
58,753 |
1.66 |
|
| Insurance
Companies |
2 |
15,750 |
0.44 |
|
| Joint
Stock Companies |
4 |
25,136 |
0.71 |
|
| Financial
Institutions |
4 |
1,128,577 |
31.81 |
|
| Associated
Companies |
2 |
702,009 |
19.79 |
|
| Charitable
Institutions |
1 |
130,429 |
3.68 |
|
|
---------- |
---------- |
---------- |
|
|
742 |
3,547,500 |
100.00 |
|
|
========== |
========== |
========== |
|
|
|
|
| 10
YEARS AT A GLANCE |
|
|
Rs. in '000' |
|
|
1999-2000 |
1998-99 |
1997-98 |
1996-97 |
*1995-96 |
1994 |
1993 |
1992 |
1991 |
1990 |
|
|
|
| Sales |
|
306,027 |
238,952 |
189,532 |
330,166 |
772,297 |
358,729 |
300,157 |
247,878 |
312,480 |
316,850 |
|
| Profit/(loss)
after tax |
|
1,602 |
(1,290) |
(18,497) |
(12,332) |
15,269 |
10,709 |
6,026 |
2,737 |
11,027 |
12,089 |
|
|
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
|
| Tangible
fixed assets |
|
67,792 |
71,246 |
75,880 |
81,917 |
65,962 |
63,891 |
65,750 |
69,861 |
73,898 |
60,058 |
|
| Long
term investment/ |
|
|
| deposits |
|
444 |
444 |
11,324 |
11,324 |
11,314 |
11,304 |
11,233 |
11,219 |
11,251 |
2,553 |
|
| Working
capital |
|
18,817 |
15,358 |
2,925 |
17,199 |
47,132 |
42,824 |
35,886 |
35,791 |
32,606 |
50,596 |
|
|
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
|
| Net
assets employed |
|
87,053 |
87,048 |
90,129 |
110,440 |
124,408 |
118,019 |
112,869 |
116,871 |
117,755 |
113,207 |
|
|
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
|
| Issued capital |
|
35,475 |
35,475 |
35,475 |
35,475 |
35,475 |
33,000 |
33,000 |
33,000 |
33,000 |
33,000 |
|
| Reserve
and retained earnings |
|
42,774 |
42,768 |
45,832 |
64,329 |
76,661 |
71,849 |
64,440 |
64,189 |
61,452 |
53,483 |
|
|
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
|
| Shareholders'
equity |
|
78,249 |
78243 |
81,307 |
99,804 |
112,136 |
104,849 |
97,440 |
97,189 |
94,452 |
86,483 |
|
| Long
term loans |
|
-- |
-- |
-- |
1,768 |
3,310 |
8,174 |
10,910 |
15,102 |
18,679 |
23,576 |
|
| Deferred
liabilities |
|
8,804 |
8,805 |
8,822 |
8,868 |
8,962 |
4,996 |
4,519 |
4,580 |
4,624 |
3,148 |
|
|
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
----------- |
|
| Capital
employed |
|
87,053 |
87,048 |
90,12(3 |
110,440 |
124,408 |
118,019 |
112,869 |
116,871 |
117,755 |
113,207 |
|
|
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
========== |
|
| Financial
ratios: |
|
|
| Current
assets: |
|
|
| Current
liabilities |
|
1.09:1 |
1.09:1 |
1.02:1 |
1.07:1 |
1.19:1 |
1.37:l |
1.37:1 |
1.49:1 |
1.43:1 |
1.66:1 |
|
| Turnover:
Total assets |
|
1.05:1 |
0.96:1 |
0.75:1 |
0.96:1 |
2.08:1 |
1.53:1 |
1.42:1 |
1.31:1 |
1.61:1 |
1.67:1 |
|
| Long
term loans: Equity |
|
N.A |
N.A |
N.A |
0.02:1 |
0.03:1 |
0.08:1 |
0.11:1 |
0.16:1 |
0.20 1 |
0.27:1 |
|
| Earning/Share
after tax Rs. |
|
0.45 |
N.A |
N A |
NA |
4.30 |
3.25 |
l.83 |
0.83 |
3.34 |
3.66 |
|
| Net
earning/Rupee |
|
|
| of sales |
|
Rs. |
0.01 |
N.A |
N.A |
N.A |
0.02 |
0.03 |
0.02 |
0.01 |
0.04 |
0.04 |
|
| Break
up value/share |
Rs. |
22.06 |
22.06 |
22.,72 |
28.13 |
31.61 |
31.77 |
29.,53 |
29.4,5 |
28.62 |
26.21 |
|
| Net
return on equity |
% |
2.05 |
N.A |
N.A |
N.A |
13.62 |
10.21 |
6.18 |
2.82 |
11.67 |
13.98 |
|
| Net
return on capital employed |
% |
1.84 |
N.A |
N.A |
N.A |
12.27 |
9.07 |
5.34 |
2.34 |
9.36 |
10.68 |
|
| Net
return on total assets |
% |
0.55 |
N.A |
N.A |
N.A |
4.11 |
4.56 |
2.86 |
1.44 |
5.68 |
6.15 |
|
| Cash dividend |
|
% |
4.50 |
5.00 |
-- |
-- |
22.50 |
10.00 |
17.50 |
-- |
17.50 |
17.50 |
|
| Bonus issue |
|
% |
-- |
-- |
-- |
-- |
-- |
7.50 |
-- |
-- |
-- |
-- |
|
|
|
|
|
|
|
| *Figures
are for eighteen months ended June 30, 1996 |
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of PIONEER CABLES LIMITED as at June
30, 2000 and the |
|
| related
profit & loss account, cash flow statements of changes in equity together
with the notes forming part |
|
| thereof
for the year then ended and we state that we 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 standards |
|
| 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 amounts 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 overall |
|
| 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 |
|
| 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, investment 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 except |
|
| for
the financial effects of the matter referred to in note no. 12.1 to the
accounts which if charged the |
|
| profit
would be lesser for the year by Rs.6.378 million, the balance sheet, profit
& loss account, cash |
|
| flow
statements and statement of changes in equity together with the notes forming
part thereof |
|
| conform
with approved accounting standards as applicable in Pakistan and give the
information |
|
| required
by 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 30thJune 2000, and of the
profit, its cash flows and |
|
| changes
in equity for the year then ended; and |
|
|
| (d)
in our opinion, Zakat deductible 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. |
|
|
| Karachi: |
|
RAHIM IQBAL RAFIQ & COMPANY |
|
| Dated:
November 14, 2000 |
|
Chartered Accountants. |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 2000 |
|
|
|
Note |
2000 |
1999 |
|
|
|
Rupees |
Rupees |
|
| SHARE
CAPITAL AND RESERVES |
|
| Authorized
Capital |
|
| 4,000,000
ordinary shares of Rs. 10/- each |
|
40,000,000 |
40,000,000 |
|
|
========== |
========== |
|
| Issued,
subscribed and paid up capital |
|
3 |
35,475,000 |
35,475,000 |
|
| General
reserve |
|
4 |
74,225,000 |
74,225,000 |
|
| Unappropriated
loss |
|
(31,451,020) |
(31,4.56,967) |
|
|
------------ |
------------ |
|
|
78,248,980 |
78,243,033 |
|
| DEFERRED
LIABILITIES |
|
| Taxation |
|
8,500,000 |
8,500,000 |
|
| Staff gratuity |
|
303,886 |
304,574 |
|
|
------------ |
------------ |
|
|
8,803,886 |
8,804,574 |
|
| CURRENT
LIABILITIES |
|
| Short
term finances |
|
5 |
97,649,373 |
87,570,450 |
|
| Creditors,
accrued and other liabilities |
|
6 |
101,107,710 |
71,341,429 |
|
| Taxation |
|
2,746,083 |
2,156,547 |
|
| Proposed
dividend |
|
1,596,375 |
1,773,750 |
|
|
------------ |
------------ |
|
|
203,099,541 |
162,842,176 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
7 |
|
|
------------ |
------------ |
|
|
290,152,407 |
249,889,783 |
|
|
=========== |
=========== |
|
| FIXED
CAPITAL EXPENDITURE |
|
| Operating
fixed assets |
|
8 |
67,791,956 |
53,563,699 |
|
| Capital
work-in-progress |
|
9 |
-- |
17,682,246 |
|
|
| LONG
TERM SECURITY DEPOSITS |
|
444,355 |
444,355 |
|
|
| CURRENT
ASSETS |
|
| Stores
and spares |
|
10 |
376,932 |
265,603 |
|
| Stock-in-trade |
|
11 |
115,530,128 |
74,145,351 |
|
| Trade debts |
|
12 |
83,596,436 |
85,074,491 |
|
| Loans,
advances, deposits, |
|
|
|
| prepayments
and other receivables |
|
13 |
22,125,463 |
17,397,191 |
|
|
|
|
| Cash
and bank balances |
|
14 |
287,137 |
1,316,847 |
|
|
|
------------ |
------------ |
|
|
221,916,096 |
178,199,483 |
|
|
|
------------ |
------------ |
|
|
290,152,407 |
249,889,783 |
|
|
=========== |
=========== |
|
| The
annexed notes form an integral part of these financial statements. |
|
|
|
|
|
|
SAID AHMED |
|
RASHID ZAKARIA BAWANY |
|
|
Director and Chairman |
|
Director and Chief Executive |
|
|
|
|
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2000 |
|
|
|
Note |
2000 |
1999 |
|
|
|
Rupees |
Rupees |
|
| Sales-Net |
|
15 |
306,026,518 |
238,952,429 |
|
| Cost of sales |
|
16 |
274,973,875 |
212,433,688 |
|
|
|
------------- |
------------- |
|
| Gross profit |
|
|
31,052,643 |
26,518,741 |
|
| Administration
expenses |
|
17 |
14,440,498 |
12,717,622 |
|
| Selling
expenses |
|
18 |
5,224,910 |
6,780,657 |
|
|
|
|
|
|
19,665,408 |
19,498,279 |
|
|
------------- |
------------- |
|
| Operating
profit |
|
11,387,235 |
7,020,462 |
|
|
| Financial
charges |
|
19 |
(3,822,835) |
(7,736,401) |
|
| Other income</ |
