| Shezan International Limited |
|
|
|
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|
|
|
| Annual
Report 2000 |
|
|
| Contents |
|
|
| Company's
Profile |
|
|
| Notice
of Meeting |
|
|
| Directors'
Report to the Members |
|
|
| Five
Years Review at a Glance |
|
|
| Pattern
of Shareholdings |
|
|
| Auditors'
Report to the Members |
|
|
| Balance Sheet |
|
|
|
| Profit
and Loss Account |
|
|
| Cash
Flow Statement |
|
| Statement
of Changes in Equity |
|
|
| Notes
to the Accounts |
|
|
| Statement
u/s 237 of the Companies Ordinance, 1984 |
|
| Subsidiary
Company's Accounts |
|
|
| Consolidated
Accounts |
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|
| Company's
Profile |
|
|
| Board
of Directors: |
|
| Mr.
Muneer Nawaz |
Chairman |
|
| Mr.
Saifi Chaudhary |
Chief Executive |
|
| Mrs.
Majeeda Begum |
|
|
| Mr.
Mahmood Nawaz |
|
|
| Mr.
C. M. Khalid |
|
|
| Mr. M. Naeem |
|
|
|
| Mr.
Muhammad Khalid |
|
|
| Mr.
Fiyaz Ahmed Longi |
(Nominee N.I.T.) |
|
| Mr.
Adnan Meraj |
(Nominee N.I.T.) |
|
|
| Executive
Director & Company Secretary: |
|
| Mr.
Muhammad Khalid. |
|
|
| Registered
Office / Head Office: |
|
| 56-Bund
Road, Lahore - 54500. |
|
|
| Factories: |
|
| Bund
Road, Lahore. |
|
| Phone:
(042) 7466900-04, |
|
| Fax:
(042) 7466899-95, |
|
| E-mail:
shezan@brain.net.pk |
|
|
| Federal
"B", Industrial Area, Karachi. |
|
| Phone:
(021) 6344722-23, |
|
|
| Fax:
(021) 6313790, |
|
|
| E-mail:
shezan@cyber.net.pk |
|
|
|
|
|
| Auditors: |
|
|
|
| Messrs.
Ford, Rhodes, Robson, Morrow, |
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| Chartered
Accountants, |
|
|
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| 1st
Floor, The Syed, 11-Givie Centre, |
|
|
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| New
Garden Town, Lahore. |
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|
|
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| Legal Advisors: |
|
|
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| Messrs.
Cornelius, Lane & Mufti, |
|
|
|
| Nawa-e-Waqt
Building, |
|
|
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| Shahrah-e-Fatima
Jinnah, Lahore. |
|
|
| Bankers: |
|
|
|
| United
Bank Limited. |
|
|
| Citibank N.A. |
|
|
|
| The
Hong Kong and Shanghai |
|
|
| Banking
Corporation Limited. |
|
|
| The
Bank of Khyber. |
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|
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| Notice
of Meeting |
|
|
| Notice
is hereby given that the 37th Annual General Meeting of the Company will be
held at 10:30 hours |
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| on
Saturday the 23rd December 2000 at the Company's Registered Office: 56-Bund
Road, Lahore, to transact |
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| the
following business: |
|
|
| 1.
To confirm the minutes of Annual General Meeting of the Company held on |
|
| December
31, 1999. |
|
|
|
|
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| 2.
To receive and adopt the Directors' and Auditors' Report and Audited Accounts
for the |
|
| year
ended June 30, 2000. |
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|
|
|
|
| 3.
To approve dividend @ Rs. 6.00 per share (60%) as recommended by the Board of |
|
| Directors. |
|
|
|
|
|
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| 4.
To appoint Auditors for the year 2000-2001 and fix their remuneration. The
present |
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| Auditors
Messrs. Ford, Rhodes, Robson, Morrow, Chartered Accountants being eligible, |
|
| offer
themselves for re-appointment. |
|
|
|
|
| 5.
To transact any other business with the permission of the Chair. |
|
|
| Shares
transfer books of the company will be closed from December 25, 2000 to
January 10, 2001 (both |
|
| days
inclusive) for determining the entitlement of the dividend. |
|
|
|
|
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|
By order of the Board |
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| Lahore: |
|
|
|
|
| November
18, 2000. |
|
Executive Director |
|
|
|
|
|
|
| Notes: |
|
|
| 1.
A member entitled to attend and vote at the General Meeting is entitled to
appoint a proxy to |
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| attend
and vote on his/her behalf. Form of proxies, in order to be valid, must be
received at the |
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| Registered
Office of the Company not less than 48 hours before the Meeting. |
|
|
|
|
| 2.
Shareholders are requested to notify the change of address, if any,
immediately. |
|
|
|
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| 3.
Members whose shares are deposited with Central Depository System are
requested to bring |
|
| their
original National Identity Cards alongwith the Account Number in Central
Depository |
|
| System
for attending the meeting. |
|
|
|
|
|
| Director's
Report to the Members |
|
|
| It
gives us great pleasure to welcome you to the 37th Annual General Meeting of
the Company. |
|
|
| There
was a significant increase in sales during the year from Rs. 657,118,992 to
Rs. 695,178,610 and a |
|
| healthy
increase in profit of about 20%. In our six monthly accounts we had told our
shareholders that the |
|
| company
is making efforts to increase sales and margins and by the Grace of Allah we
have been successful |
|
| in
this regard during the current year. This is demonstrated by the fact that
inspite of inflationary pressure |
|
| and
slow down in the economy, we had an increase in sales and resultant increase
in profit after taxation |
|
| which
increased from Rs. 26,248,651 to Rs. 31,436,553. |
|
|
| We
are sure that our shareholders would be pleased with these results of the
company keeping in view |
|
| the
adverse economic environment of the country. No doubt this has been made
possible by proper |
|
| marketing
efforts and control on expenses by the management of the company. |
|
|
| During
the period under review there has been a decrease in exports. The main reason
being that a |
|
| significant
part of exports were to Bangladesh but now since the domestic industry has
started establishing |
|
| itself
in Bangladesh, our exports have shown a downward trend. We are trying to find
new export markets |
|
| and
are confident that we will be able to improve upon our export performance but
everybody is aware |
|
| that
to develop export market takes more time; your management is aware of this
situation and is making |
|
| efforts
to increase exports in other markets particularly the USA. |
|
|
| The
inflationary cycle in the country is continuing especially in the case of
utilities and POL products and |
|
| in
the year under reference there has been a tremendous increase in the price of
sugar which is a main |
|
| raw
material for our products. This inflationary cycle is expected to continue in
the current year and your |
|
| Directors
are aware of this challenge and are trying to maintain the margins so that
the profitability of the |
|
| company
does not suffer. |
|
|
| The
results of our wholly owned subsidiary Hattar Fruit Products Limited continue
to be satisfactory as |
|
| can
be seen from their accounts. |
|
|
| Financial
Results: |
|
| As
you will observe from Balance Sheet and Profit |
|
| and
Loss Account, our financial results are as under:- |
|
|
|
|
(Rupees in thousands) |
|
|
| Profit
before taxation |
|
50,936 |
|
| Taxation |
|
|
19,500 |
|
|
|
|
------------------ |
|
| Profit
after taxation |
|
31,436 |
|
| Unappropriated
profit |
|
| brought forward |
|
|
4,119 |
|
|
|
|
------------------ |
|
| Available
for appropriation |
|
35,555 |
|
|
|
| Appropriations: |
|
| Transfer
to General reserve |
|
-- |
|
| Proposed
dividend @ 60% (1999: 50%) |
|
30,000 |
|
|
|
|
------------------ |
|
| Unappropriated
profit carried forward |
|
5,555 |
|
|
========== |
|
|
| Dividend: |
|
| The
Company has always followed a policy of sharing profit |
|
| with
the Shareholders and the same policy is being repeated. |
|
|
| Future
Prospects: |
|
| Keeping
in view the improvement in the current year, we |
|
| are
confident that with correct emphasis on the marketing |
|
| efforts,
we would be able to improve our sales and profitability |
|
| as
the Shezan brand is well known in the country. By the |
|
| Grace
of Allah we are hopeful that we would maintain our |
|
| position
as leading processors of fruits & vegetables in Pakistan. |
|
|
| We
continue to make our humble contribution to the national |
|
| exchequer,
by contributing Rs. 50,311,652 in the shape of |
|
| Excise
Duty and Rs. 121,350,522 as Sales Tax for the year |
|
| ended
June 30, 2000. |
|
|
| Auditors: |
|
| The
present Auditors Messrs. Ford, Rhodes, Robson, Morrow, Chartered Accountants
have conveyed their |
|
| willingness
to be appointed in the ensuing year. |
|
|
| Labour
Management Relations: |
|
| During
the year under review the labour and management relations remained cordial.
Your Directors place |
|
| on
record their appreciation for the loyalty and devotion to duty of the
officers and workers of all categories. |
|
|
|
|
On behalf of the Board |
|
| Lahore: |
|
|
|
|
| November
18, 2000. |
|
Chief Executive |
|
|
|
| Five
Years Review at a Glance |
|
|
|
|
|
(Rupees in thousands) |
|
|
Year |
Year |
Year |
Year |
Year |
|
|
1996 |
1997 |
1998 |
1999 |
2000 |
|
|
(Six months) |
|
|
|
|
|
| Income |
|
|
| Sales |
|
682,248 |
536,428 |
591,166 |
657,119 |
695,178 |
|
| Others |
|
3,911 |
2,154 |
14,144 |
5,847 |
3,643 |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
|
686,159 |
538,582 |
605,310 |
662,966 |
698,821 |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
| Expenditure |
|
|
| Cost of sales |
|
524,704 |
415,481 |
468,348 |
517,477 |
528,989 |
|
|
| Administrative, |
|
|
|
|
| selling
and general |
99,956 |
82,819 |
92,362 |
93,552 |
100,569 |
|
|
| Financial |
|
3,452 |
1,986 |
953 |
898 |
1,995 |
|
|
| Others |
|
17,500 |
15,606 |
15,003 |
14,290 |
16,332 |
|
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
|
|
645,612 |
515,892 |
576,666 |
626,217 |
647,885 |
|
|
|
|
========== |
========== |
========== |
========== |
========== |
|
|
|
|
| Profit
before taxation |
40,547 |
22,690 |
28,644 |
36,749 |
50,936 |
|
|
| Taxation |
|
14,450 |
4,000 |
6,500 |
10,500 |
19,500 |
|
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
| Profit
after taxation |
26,097 |
18,690 |
22,144 |
26,249 |
31,436 |
|
|
|
|
========== |
========== |
========== |
========== |
========== |
|
|
|
|
| Paid-up capital |
|
50,000 |
50,000 |
50,000 |
50,000 |
50,000 |
|
|
| Reserves
& unappropriated profits |
98,536 |
102,226 |
106,870 |
108,119 |
109,555 |
|
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
| Shareholders
equity |
148,536 |
152,226 |
156,870 |
158,119 |
159,555 |
|
|
|
|
========== |
========== |
========== |
========== |
========== |
|
|
|
|
|
| Break
up value per share in Rupees |
29.71 |
30.44 |
31.38 |
31.62 |
31.91 |
|
|
| Earnings
per share in Rupees |
5.22 |
3.74 |
4.43 |
5.25 |
6.29 |
|
|
| Cash
distribution per share in Rupees |
4.25 |
3.00 |
3.50 |
5.00 |
6.00 |
|
|
|
|
========== |
========== |
========== |
========== |
========== |
|
|
|
|
|
|
|
| Pattern
of Shareholdings as at June 30, 2000 |
|
|
| Number of |
Shareholdings |
|
Total Shares |
|
| Shareholders |
From |
To |
Held |
|
|
| 64 |
1 |
100 |
6,400 |
|
| 148 |
101 |
500 |
60,700 |
|
| 44 |
501 |
1,000 |
39,700 |
|
| 47 |
1,001 |
5,000 |
120,700 |
|
| 4 |
5,001 |
10,000 |
26,349 |
|
| 2 |
10,001 |
15,000 |
25,150 |
|
| 2 |
20,001 |
25,000 |
43,025 |
|
| 3 |
25,001 |
30,000 |
84,500 |
|
| 2 |
35,001 |
40,000 |
76,000 |
|
| 1 |
40,001 |
45,000 |
43,200 |
|
| 2 |
50,001 |
55,000 |
105,030 |
|
| 1 |
55,001 |
60,000 |
55,530 |
|
| 2 |
65,001 |
70,000 |
132,480 |
|
| 1 |
70,001 |
75,000 |
72,300 |
|
| 2 |
75,001 |
80,000 |
153,400 |
|
| 2 |
95,001 |
100,000 |
199,900 |
|
| 1 |
100,001 |
105,000 |
102,200 |
|
| 1 |
105,001 |
110,000 |
109,625 |
|
| 1 |
165,001 |
170,000 |
165,811 |
|
| 3 |
210,001 |
215,000 |
636,906 |
|
| 1 |
355,001 |
360,000 |
356,117 |
|
| 1 |
465,001 |
470,000 |
467,107 |
|
| 1 |
1,915,001 |
1,920,000 |
1,917,870 |
|
| ------------------ |
|
------------------ |
|
| 336 |
|
|
5,000,000 |
|
| ========== |
|
|
========== |
|
|
| The
slabs representing Nil holding have been omitted. |
|
|
|
| Categories
of Shareholders |
|
|
|
|
Number of |
Shares |
|
|
| Particulars |
|
Shareholders |
Held |
Percentage |
|
|
| Individuals |
|
325 |
2,842,405 |
56.85% |
|
| Joint
Stock Companies |
|
4 |
23,125 |
0.46% |
|
| Investment
Companies |
|
3 |
71,400 |
1.43% |
|
| Insurance
Companies |
|
2 |
45,200 |
0.90% |
|
| Financial
Institutions |
|
2 |
2,017,870 |
40.36% |
|
|
|
------------------ |
------------------ |
------------------ |
|
|
336 |
5,000,000 |
100.00% |
|
|
|
|
========== |
========== |
========== |
|
|
| Auditors'
Report to the Members |
|
|
| We
have audited the annexed balance sheet of Shezan International Limited as at
June 30, 2000 and the |
|
| related
profit and loss account, cash flow statement and statement 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 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
include 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 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, cash flow statement 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 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, 2000 and of the profit its cash flow and changes in equity for
the year then |
|
| ended; and |
|
|
|
|
|
|
| (d)
in our opinion, Zakat deductible at source under the Zakat and Ushr
Ordinance, 1980, (XVIII of |
|
| 1980)
was deducted by the Company and deposited in the Central Zakat Fund
established under |
|
| Section
7 of that Ordinance. |
|
|
|
| Lahore: |
|
| November
18, 2000. |
|
Chartered Accountants |
|
|
|
| Balance
Sheet as at June 30, 2000 |
|
|
|
Notes |
2000 |
1999 |
|
|
|
(Rupees in
thousands) |
|
|
| Tangible
fixed assets |
|
|
|
| Operating
fixed assets |
|
3 |
39,452 |
34,763 |
|
|
|
|
| Long
term investments |
|
4 |
21,250 |
21,250 |
|
| Long
term deposits |
|
5 |
2,104 |
1,685 |
|
|
|
|
------------------ |
------------------ |
|
|
|
62,806 |
57,698 |
|
| Current assets |
|
|
|
| Stores
and spares |
|
6 |
1,405 |
870 |
|
| Stock in trade |
|
|
7 |
188,638 |
167,694 |
|
| Trade debts |
|
|
8 |
24,984 |
46,308 |
|
| Advances,
deposits, prepayments |
|
|
| and
other receivables |
|
9 |
8,825 |
10,055 |
|
| Cash
and bank balances |
|
10 |
24,337 |
19,299 |
|
|
|
|
------------------ |
------------------ |
|
|
248,189 |
244,226 |
|
| Less:
Current liabilities |
|
| Short-term
running finances |
|
11 |
3,111 |
18,665 |
|
| Current
maturity of obligations |
|
|
|
| under
finance lease |
|
15 |
3,424 |
734 |
|
| Creditors,
accrued and other liabilities |
12 |
99,109 |
94,796 |
|
| Taxation |
|
|
|
5,472 |
-- |
|
| Dividends |
|
|
13 |
30,164 |
25,143 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
141,280 |
139,338 |
|
|
|
------------------ |
------------------ |
|
| Working
capital |
|
106,909 |
104,888 |
|
|
|
|
|
|
| Total
capital employed |
|
169,715 |
162,586 |
|
|
|
| Long
term and deferred liabilities |
|
| Deferred
taxation |
|
3,000 |
2,500 |
|
| Obligations
under finance lease |
|
15 |
7,160 |
1,967 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
10,160 |
4,467 |
|
|
|
------------------ |
------------------ |
|
| Net
capital employed |
|
|
139,553 |
158,119 |
|
|
|
|
========== |
========== |
|
|
|
|
|
| Represented by |
|
|
|
| Share capital |
|
|
14 |
50,000 |
50,000 |
|
| General reserve |
|
|
|
104,000 |
104,000 |
|
| Unappropriated
profit |
|
|
5,555 |
4,119 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
159,555 |
158,119 |
|
| Contingencies
and commitments |
|
16 |
-- |
-- |
|
|
------------------ |
------------------ |
|
|
|
|
159,555 |
158,119 |
|
|
|
|
========== |
========== |
|
|
|
|
| The
attached notes form an integral part of these accounts. |
|
|
|
Chief Executive |
|
Director |
|
|
|
|
| Profit
and Loss Account |
|
| for
the year ended June 30, 2000 |
|
|
|
Notes |
2000 |
1999 |
|
|
|
(Rupees in
thousands) |
|
|
| Sales |
|
17 |
695,178 |
657,119 |
|
| Cost of sales |
|
18 |
528,989 |
517,477 |
|
|
|
|
------------------ |
------------------ |
|
| Gross profit |
|
|
166,189 |
139,642 |
|
|
|
|
| Less: |
Administrative and
general expenses |
19 |
26,216 |
23,995 |
|
|
Selling and distribution
expenses |
20 |
74,353 |
69,557 |
|
|
Financial charges |
21 |
1,995 |
898 |
|
|
Other expenses and
provisions |
22 |
16,332 |
14,290 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
118,896 |
108,740 |
|
|
------------------ |
------------------ |
|
| Operating profit |
|
|
|
47,293 |
30,902 |
|
| Other income |
|
|
23 |
3,643 |
5,847 |
|
|
------------------ |
------------------ |
|
| Profit
before taxation |
|
|
50,936 |
36,749 |
|
| Taxation |
|
|
24 |
19,500 |
10,500 |
|
