| Indus Jute Mills Limited |
|
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|
|
|
|
|
|
| Annual
Report 2001 |
|
|
| BOARD
OF DIRECTORS |
|
|
| Chief Executive: |
|
MOHAMMED A. JAMAL |
|
|
|
|
| Directors: |
|
SAFDARALI VIRJI WALJI |
|
|
|
ALI RAZA GHULAM ALI |
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|
|
RAZA HUSSAIN VIRJI WALJI |
|
|
|
MOHAMMED ALI VIRJI WALJI |
|
|
|
MUHAMMAD YOUSUF -
Representing NIT |
|
|
|
SYED ZUBAIR AHMED SHAH -
Representing NIT |
|
|
| Auditors: |
|
HYDER BHIMJI & CO. |
|
|
|
Chartered Accountants |
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|
|
| Bankers: |
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UNITED BANK LIMITED |
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|
|
NATIONAL BANK OF PAKISTAN
LTD. |
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|
|
BANK AL-HABIB LIMITED |
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|
|
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| Registered
Office: |
2nd Floor, Noor Chambers, |
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|
M.A. Jinnah Road, |
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|
Karachi. |
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| Mills: |
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Dhabeji Industrial Area, |
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District Thatta, Sindh. |
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| NOTICE
OF MEETING |
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| NOTICE
is hereby given that 35th Annual General Meeting of the Shareholders of the |
|
| Company
will be held at the Registered Office of the Company at 2nd Floor, 53-Noor
Chambers, |
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| M.A.
Jinnah Road, Karachi on Saturday, the 29th December, 2001 at 11.00 a.m. to
transact the |
|
| following
business:- |
|
|
| 1.
To confirm Minutes of the Annual General Meeting held on 26th February, 2001. |
|
|
| 2.
To receive and adopt the Directors' Report and Audited Accounts for the year
ended 30th |
|
| June, 2001. |
|
|
|
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| 3.
To appoint Auditors for the year 2001-2002 and fix their remuneration. |
|
|
| 4.
To transact such other business as may be placed before the meeting with
permission |
|
| of the Chair. |
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|
By Order of the Board |
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|
ARIF AHMED |
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| KARACHI:
the 30th November, 2001 |
|
Company Secretary |
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|
| NOTE |
|
|
| 1.
The Share Transfer Book of the Company will remain closed from 23rd December,
2001 |
|
| to
29th December, 2001 (both days inclusive). |
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|
|
|
| 2.
A member entitled to attend and vote at this meeting may appoint another
member as |
|
| his
proxy to attend the Meeting. Proxy must be deposited at the Registered Office
of |
|
| the
Company not less than 48 hours before the Meeting. A Proxy must be a member. |
|
|
| 3.
The Shareholders are advised to notify the Company immediately of any change
in their |
|
| addresses
to ensure prompt delivery of mail. |
|
|
| 4.
CDC shareholders desiring to attend the meeting are requested to bring their
original |
|
| National
Identity Card and Account & Participant's ID numbers, for identification |
|
| purpose
and in case of proxy, to enclose an attested copy of his/her National
Identity |
|
| Card. |
|
|
|
|
|
| DIRECTORS'
REPORT TO THE SHAREHOLDERS |
|
|
| Your
directors are pleased to place before you their 35th Annual Report together
with |
|
| audited
accounts of your company for the year ended 30th June, 2001. |
|
|
| The
financial results for the year under report are as under:- |
|
|
| NET
LOSS BEFORE THE FOLLOWING: |
|
|
Rs. (32,893,851) |
|
|
|
|
|
|
|
| Add: Depreciation |
|
|
Rs. 11,075,328 |
|
|
|
|
|
|
|
| Provision
for taxation |
|
|
Rs. 4,967,173 |
Rs. (16,042,501) |
|
|
------------------ |
------------------ |
|
|
Net loss for the year |
|
|
Rs. (48,936,352) |
|
| Add: |
Net loss brought forward |
|
|
Rs. (19,181,741) |
|
|
|
------------------ |
|
| Net
Loss Carried Forward |
|
|
Rs. (68,118,093) |
|
|
|
========== |
|
|
| In
view of the adverse financial results, directors have decided to passover
dividend. |
|
|
| WORKING
RESULTS |
|
| During
the financial year under report, the company suffered net post-taxation loss
of |
|
| Rs.
48.936 million mainly due to (1) carrying huge stocks of major product jute
grain sacks till |
|
| March,
2001 due to surplus wheat at home being no demand in the period
August/December, 2000. |
|
| (2)
Loss of business of 3000 bales suffered by the company on account of
non-availability of required |
|
| qualities
of raw material which could not be imported due to L/c opening restrictions.
(3) Fire |
|
| at
port which affected 1,500 tons raw jute stock in March, 2001 resulting in
layoffs and increase |
|
| in
the fixed expenses. (4) Persisting liquidity crisis forcing bankers to stop
L/c opening for buying |
|
| raw
jute timely. (5) Non-payment of bill by Sind Government amounting to Rs.
17.50 million for |
|
| 45
days. (6) Withholding of security deposit of Rs. 7.5 million by the Punjab
Food for 90 days which |
|
| was
received in the subsequent financial year. (7) Food departments bargained and
negotiated |
|
| rock
bottom rates for grain sacks due to high stocks levels with the industry in
March 2001. (8) |
|
| Inability
of the company to retrench 49% labour force which is management's right
forcing it to |
|
| keep
the factory running on layoffs and thus increase fixed expenses and (9)
Increase in electricity |
|
| costs
to tariff increases and fixed charges. |
|
|
| SALES
TURNOVER |
|
| As
a result of lower demand, sales during the year under review declined by 28%.
Decline |
|
| in
sales would have been higher had exports to Iran not increased from Rs. 6.744
million to |
|
| Rs.
50.193 million. In view of uncertain procurement targets, buying agencies
resorted to remain |
|
| away
from the market till the month of March. However later on, with the revision
of their targets, |
|
| orders
for heavy quantities were floated by them for supply during the April-June
quarter but |
|
| due
to depleted stocks, your company could not avail benefit of this. |
|
|
| FUTURE
PROSPECTS |
|
| Since
the bulk of product is jute grain sacks and it's demand can only be firmed up
in |
|
| February/March,
2001 the real impact of operating position would crystallize in that period.
The |
|
| Central
government has, however, instructed provincial food departments to procure 4
million |
|
| tons
wheat, which would create industry demand of 120,000 bales of grain sacks.
But with the |
|
| industry's
current stock position, it appears that the industry would find it difficult
to meet the |
|
| target. |
|
|
| DIRECTORS |
|
| On
17-11-2001, Mr. Syed Zubair Ahmed Shah was co-opted on the Company's Board as |
|
| nominee
Director of N.I.T. in place of their outgoing nominee Director Ms. Farzana
Munaf. |
|
|
| The
Board place on record their appreciation for the contributions made by Ms.
Farzana |
|
| Munaf
during her tenure on the Board and welcome Mr. Syed Zubair Ahmed Shah. |
|
|
| PATTERN
OF SHAREHOLDINGS |
|
| The
pattern of shareholdings as at June, 2001 is attached to this report. |
|
|
| AUDITORS |
|
| The
present auditors of the Company M/s. Hyder Bhimji & Company, Chartered
Accountants, |
|
| retire
and being eligible, offer themselves for re-appointment for the financial
year 2001-2002. |
|
|
| The
Directors wish to place on record their appreciation for the enthusiasm,
loyalty and |
|
| devotion
to duty displayed by the workers, staff and executives of the company. |
|
|
|
|
On behalf of the Board |
|
|
|
|
|
|
|
|
|
MOHAMMED A. JAMAL |
|
| KARACHI:
the 30th November, 2001 |
|
Chief Executive |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of M/s INDUS JUTE
MILLS LIMITED as at June 30th, |
|
| 2001
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
have obtained |
|
| all
the information and explanations which, to the best of our knowledge and
belief, were necessary |
|
| for
the purpose 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 responsible
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 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 company's
business; and |
|
|
| iii)
the business conducted 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, except the deviation from IAS-19 as more |
|
| fully
explained in note 7.1 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 30th, 2001 and of the loss, it's cash flow and
changes in |
|
| equity
for the year then ended; and |
|
|
| (d)
in our opinion, Zakat deductible at source, under Zakat and Ushr Ordinance,
1980 (XVIII |
|
| of
1980), was deducted by the company and deposited into the Central Zakat Fund |
|
| established
under section 7 of that Ordinance. |
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|
|
|
|
|
|
|
HYDER BHIMJI AND CO. |
|
| KARACHI:
the 30th November, 2001 |
|
Chartered Accountants |
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 2001 |
|
|
|
|
Note |
2001 |
2000 |
|
|
|
No. |
Rupees |
Rupees |
|
| CAPITAL
& RESERVES |
|
|
|
| Authorised
Capital: |
|
| 5,000,000
Ordinary Shares |
|
| of Rs. 10/-each. |
|
50,000,000 |
50,000,000 |
|
|
|
|
========== |
========== |
|
| Issued,
Subscribed & Paid-up Capital |
3 |
28,102,030 |
28,102,030 |
|
|
|
|
| RESERVES |
|
|
|
| Capital |
|
4 |
19,500,000 |
19,500,000 |
|
| Revenue |
|
4 |
38,000,000 |
38,000,000 |
|
| Accumulated
(Loss) |
|
|
(68,118,093) |
(19,181,741) |
|
|
------------------ |
------------------ |
|
|
|
|
(10,618,093) |
38,318,259 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
17,483,937 |
66,420,289 |
|
| SURPLUS
ON REVALUATION OF |
|
|
|
| FIXED ASSETS |
|
|
5 |
67,763,005 |
67,763,005 |
|
| LIABILITIES
AGAINST ASSETS SUBJECT |
|
|
|
| TO
FINANCE LEASE |
|
6 |
1,100,966 |
987,355 |
|
| DEFERRED
LIABILITIES |
|
7 |
67,850,501 |
72,181,240 |
|
|
|
|
|
|
| CURRENT
LIABILITIES |
|
| Short
Term Loans -- unsecured |
|
8 |
28,921,484 |
28,921,484 |
|
| Short
Term Running Finance utilized |
|
|
|
| under
mark-up arrangements (Secured) |
9 |
42,444,306 |
15,214,359 |
|
| Current
Portion of Liabilities against |
|
|
|
| Assets
Subject to Finance Lease |
|
|
515,959 |
1,202,008 |
|
| Creditors,
Accrued and Other Liabilities |
10 |
95,797,535 |
82,045,142 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
167,679,284 |
127,382,993 |
|
| Contingencies
and Commitments |
|
11 |
-- |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
Total Rupees |
321,877,693 |
334,734,882 |
|
|
|
|
|
========== |
========== |
|
|
| NOTE:
The annexed notes form an integral part of these accounts. |
|
|
|
|
| KARACHI:
the 30th November, 2001 |
|
|
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating
Fixed Assets |
|
12 |
136,196,591 |
143,123,961 |
|
|
|
|
|
| Stores
and Spares held for |
|
|
|
| Capital
Expenditure |
|
|
5,956,980 |
5,058,052 |
|
|
|
------------------ |
------------------ |
|
|
|
142,153,571 |
148,182,013 |
|
| LONG
TERM LOANS AND ADVANCES |
13 |
1,296,658 |
2,129,463 |
|
| LONG
TERM DEPOSITS |
|
14 |
1,744,131 |
1,266,592 |
|
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Stores,
Spares & Loose Tools |
|
15 |
18,478,060 |
21,549,477 |
|
| Stock-in-Trade |
|
|
16 |
46,466,605 |
49,479,655 |
|
| Trade
Debts (Unsecured) |
|
|
|
| Considered
Good |
|
|
45,770,061 |
36,699,127 |
|
|
|
|
|
| Loan
and Advances |
|
17 |
2,446,666 |
3,625,860 |
|
| Trade
Deposits & Prepayments |
|
18 |
10,935,020 |
13,538,181 |
|
| Other
Receivables |
|
19 |
9,112,530 |
6,421,325 |
|
| Advance
Income Tax |
|
|
36,356,135 |
29,688,125 |
|
| Cash
& Bank Balances |
|
20 |
7,118,256 |
22,155,064 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
176,683,333 |
183,156,814 |
|
|
------------------ |
------------------ |
|
|
Total Rupees |
321,877,693 |
334,734,882 |
|
|
|
|
========== |
========== |
|
|
|
MOHAMMED A. JAMAL |
|
ALI RAZA GHULAMALI |
|
|
Chief Executive |
|
|
MOHAMMED ALI VIRJI WALJI |
|
|
|
|
Directors |
|
|
|
|
| KARACHI:
the 30th November, 2001 |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
Note |
2001 |
2000 |
|
|
No. |
Rupees |
Rupees |
|
|
| Sales |
|
|
354,942,214 |
494,319,025 |
|
| Cost
of Goods Sold |
|
|
(355,163,786) |
(462,320,233) |
|
|
|
|
------------------ |
------------------ |
|
| Gross
(Loss)/Profit |
|
|
(221,572) |
31,998,792 |
|
| Trading
Profit / (Loss) |
|
23 |
-- |
6,618 |
|
|
|
|
------------------ |
------------------ |
|
|
|
(221,572) |
32,005,410 |
|
|
| OPERATING
EXPENSES |
|
|
|
| Administrative |
|
24 |
(15,611,622) |
(16,406,855) |
|
| Selling
and Distribution |
|
25 |
(12,468,898) |
(10,748,762) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(28,080,520) |
(27,191,617) |
|
|
|
|
------------------ |
------------------ |
|
| Operating
(Loss) / Profit: |
|
|
(28,302,092) |
4,813,793 |
|
| Net
Income from Rice Division |
|
26 |
7,800,914 |
2,421,782 |
|
| Other Income |
|
|
27 |
218,276 |
161,223 |
|
|
|
------------------ |
------------------ |
|
| Financial
Charges |
|
28 |
(22,128,192) |
(24,334,696) |
|
| Other Charges |
|
|
29 |
(1,558,085) |
(442,601) |
|
|
|
------------------ |
------------------ |
|
|
|
(23,686,277) |
(24,777,297) |
|
|
|
------------------ |
------------------ |
|
| Net
(Loss) for the year before taxation |
|
(43,969,179) |
(17,380,499) |
|
| Provision
for Taxation |
|
30 |
(4,967,173) |
(2,600,000) |
|
|
|
------------------ |
------------------ |
|
| Net
(Loss) for the year after taxation |
|
(48,936,352) |
(19,980,499) |
|
| (Loss)/Profit
brought forward |
|
|
(19,181,741) |
798,758 |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
(Loss) Carried Forward |
|
(68,118,093) |
(19,181,741) |
|
|
|
========== |
========== |
|
| Earning
per Share |
|
31 |
(17.41) |
(7.11) |
|
|
|
|
|
|
========== |
========== |
|
|
|
| NOTE:
The annexed notes form an integral part of these accounts. |
|
|
|
MOHAMMED A. JAMAL |
|
ALI RAZA GHULAMALI |
|
|
Chief Executive |
|
|
MOHAMMED ALI VIRJI WALJI |
|
|
|
|
Directors |
|
|
|
|
| KARACHI:
the 30th November, 2001 |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
2001 |
2000 |
|
|
|
Rupees |
Rupees |
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Net
(Loss) before taxation |
|
(43,969,179) |
(17,380,499) |
|
|
| Adjustment
for non cash & other items: |
|
| Profit
on Sale of Fixed Assets |
|
(33,850) |
(16,608) |
|
| Depreciation |
|
11,075,328 |
11,743,780 |
|
| Provision
for Gratuity |
|
4,584,869 |
1,696,711 |
|
| Financial
Charges |
|
22,128,192 |
24,334,696 |
|
| Payment
of Gratuity |
|
(6,915,608) |
(5,409,154) |
|
|
|
------------------ |
------------------ |
|
|
|
(13,130,248) |
14,968,926 |
|
|
|
|
| CHANGES
IN WORKING CAPITAL |
|
| (Increase)
/ decrease in current assets |
|
| Stores,
Spares & Loose Tools |
|
3,071,417 |
57,184 |
|
| Stock-in-Trade |
|
|
3,013,050 |
74,014,387 |
|
| Trade Debts |
|
|
(9,070,934) |
(23,703,723) |
|
| Loan
& Advances |
|
|
638,344 |
1,185,781 |
|
| Deposits
and Prepayments |
|
|
2,603,161 |
(10,194,111) |
|
| Other
Receivables |
|
|
(2,691,205) |
(147,729) |
|
|
| Increase
/ (decrease) in current liabilities |
|
| Short
Term Loan |
|
-- |
4,625,000 |
|
| Creditors,
accrued and other liabilities |
|
9,214,379 |
47,941,494 |
|
|
|
------------------ |
------------------ |
|
|
|
6,778,212 |
93,778,283 |
|
|
|
------------------ |
------------------ |
|
|
|
(6,352,036) |
108,747,209 |
|
|
| Financial
charges paid |
|
(16,861,055) |
(25,178,041) |
|
| Income Tax paid |
|
(13,635,655) |
(27,095,238) |
|
| Income
Tax Refund Received |
|
-- |
10,701,365 |
|
| Long
Term Loans and Advances |
|
1,373,655 |
2,354,806 |
|
| Long
Term Deposits |
|
(477,539) |
272,272 |
|
|
|
------------------ |
------------------ |
|
| CASH
GENERATED FROM OPERATIONS |
|
(35,952,158) |
69,802,373 |
|
|
========== |
========== |
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Proceeds
from disposal of fixed assets |
|
385,272 |
107,900 |
|
| Fixed
capital expenditure |
|
(5,398,308) |
(5,334,643) |
|
|
|
------------------ |
------------------ |
|
| Net
cash used in investing activities |
|
(5,013,036) |
(5,226,743) |
|
|
|
========== |
========== |
|
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Assets
obtained under Finance Lease |
|
1,314,000 |
819,000 |
|
| Dividend Paid |
|
|
(729,123) |
(2,914,253) |
|
| Payments
of lease liability |
|
|
(1,886,438) |
(1,346,810) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(1,301,561) |
(3,442,063) |
|
|
|
|
------------------ |
------------------ |
|
| Net
Increase/(Decrease) in cash and cash equivalents |
(42,266,755) |
61,133,567 |
|
| Cash
and cash equivalents at the beginning of the year |
6,940,705 |
(54,192,862) |
|
|
|
|
------------------ |
------------------ |
|
| Cash
and cash equivalent at end of the year |
|
(35,326,050) |
6,940,705 |
|
|
|
|
========== |
========== |
|
|
|
MOHAMMED A. JAMAL |
|
ALI RAZA GHULAMALI |
|
|
Chief Executive |
|
|
MOHAMMED ALI VIRJI WALJI |
|
|
|
|
Directors |
|
|
|
|
| KARACHI:
the 30th November, 2001 |
|
|
|
| STATEMENT
OF CHANGES IN EQUITY |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
|
|
|
Share Capital |
Capital Reserve |
Revenue |
Unappropriated |
|
|
|
|
|
Plant & |
Reserve |
Profit/ |
Total |
|
|
|
|
Machinery |
General |
Accumulated |
|
|
|
|
|
(Loss) |
|
|
|
|
|
|
|
| Balance
as at June 30, 1999 |
28,102,030 |
19,500,000 |
38,000,000 |
798,758 |
86,400,788 |
|
| Net
Loss for the year ended |
|
|
| 30-Jun-00 |
|
-- |
-- |
-- |
(19,980,499) |
(19,980,4990) |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
28,102,030 |
19,500,000 |
38,000,000 |
(19,181,741) |
66,420,289 |
|
|
|
|
|
| Net
(loss) for the year |
|
|
| ended
June 30, 2001 |
-- |
-- |
-- |
(48,936,352) |
(48,936,352) |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
|
28,102,030 |
19,500,000 |
38,000,000 |
(68,118,093) |
17,483,937 |
|
|
|
========== |
========== |
========== |
========== |
========== |
|
|
|
MOHAMMED A. JAMAL |
|
ALI RAZA GHULAMALI |
|
|
Chief Executive |
|
|
MOHAMMED ALI VIRJI WALJI |
|
|
|
|
Directors |
|
| KARACHI:
the 30th November, 2001 |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
| 1.
STATUS AND NATURE OF BUSINESS |
|
|
| The
Company was incorporated in Pakistan on March 21, 1966 and is listed on the
Karachi |
|
| Stock
Exchange (guarantee) Limited. The Company is principally engaged in the
manufacture |
|
| and
sale of Jute Products and trading/export of Rice. |
|
|
|
|
| 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
|
| 2.1
Accounting Convention: |
|
| These
accounts have been prepared under historical cost convention. M |
