| Nimir Resins Limited |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Annual
Report 2001 |
|
|
|
| CONTENTS |
|
|
| Company
Information |
|
| Notice
of Annual General Meeting |
|
| Chairman's
Review |
|
| Directors'
Report |
|
| Auditors'
Report |
|
| Balance Sheet |
|
|
| Profit
& Loss Account |
|
| Cash
Flow Statement |
|
| Statement
of Changes in Equity |
|
| Notes
to the Accounts |
|
| Pattern
of Shareholding |
|
|
|
| COMPANY
IN FORMATION |
|
|
| BOARD
OF DIRECTORS: |
|
|
| Chairman |
|
Mr. Louis Tucker Link |
|
| Chief Executive |
|
Mr. Saeed-uz-Zaman |
|
| Directors |
|
Mr. Cherif Sedky |
|
|
|
Mr. Abdullah Al Amil |
|
|
|
Sh. Amar Hameed |
|
|
|
Sh. Farooq Jamil |
|
|
|
Mr. Abdul Jalil Jamil |
|
|
|
Mr. Hussain Aqa Naqvi |
|
|
|
(Nominee NIT) |
|
|
| COMPANY
SECRETARY: |
Mr. Shamshad A. Naushahi |
|
|
|
|
| AUDITORS: |
|
Ford, Rhodes, Robson,
Morrow |
|
|
|
Chartered Accountants |
|
|
|
|
| LEGAL
ADVISOR: |
Hassan & Hassan
(Advocates) |
|
|
|
|
| SHARES'
REGISTRAR: |
Softlink (Pvt.) Limited |
|
|
|
Wings Arcade l-K,
(Commercial) |
|
|
|
Model Town, Lahore. |
|
|
|
| MAIN
BANKERS: |
United Bank Limited |
|
|
|
Muslim Commercial Bank
Limited |
|
|
|
Habib Bank Limited |
|
|
|
Fidelity Investment Bank
Limited |
|
|
|
Faysal Bank Limited |
|
|
|
Credit Agricole Indosuez
Bank |
|
|
|
|
| FACTORY: |
|
14.8-Km, Sheikhupura -
Faisalabad Road, |
|
|
|
Mauza Bhikhi, Distt:
Sheikhupura. |
|
|
|
Ph: 04931-882189-90 |
|
|
|
| HEAD
OFFICE / REGISTERED OFFICE: |
51 -N, Industrial Area,
Gulberg II, Lahore. |
|
|
|
Tel: 90-42-571 8001-9
Fax: 92-42-571 8013 |
|
|
|
E-mail:
contact@nimir.com.pk |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the thirty seventh Annual General Meeting of the company
will be held on Friday, |
|
| the
28th December, 2001 at 11:00 a.m. at 51-N, Industrial Area, Gulberg-II,
Lahore, to transact the following |
|
| business:- |
|
|
| ORDINARY
BUSINESS |
|
|
| 1.
To confirm the minutes of the Extraordinary General Meeting of the Company
held on 19th September, |
|
| 2001. |
|
|
|
|
|
|
| 2.
To receive, consider and adopt the audited accounts of the Company for the
year ended 30th June, 2001 |
|
| together
with the Directors' and Auditors' reports thereon. |
|
|
|
|
|
| 3.
To appoint Auditors and to fix their remuneration for the year ending 30th
June, 2002. The retiring |
|
| auditors
M/s Ford, Rhodes, Robson, Morrow-Chartered Accountants being eligible offer
themselves for |
|
| re-appointment. |
|
|
|
|
|
|
| 4.
To elect seven Directors of the Company as fixed by the Board under section
178(1) of the Companies |
|
| Ordinance,
1984 for a period of three years commencing from 31st December, 2001. |
|
|
|
|
| The
retiring directors are: |
|
|
|
|
| i)
Mr. Louis Tucker Link |
v) Sh. Amar Hameed |
|
| ii)
Mr. Saeed-uz-Zaman |
vi) Sh. Farooq Jamil |
|
| iii)
Mr. Cherif Sedky |
vii) Mr. Abdul Jalil
Jamil |
|
| iv)
Mr. Abdullah Al Amil |
|
|
|
|
|
|
| All
the retiring directors are eligible to offer themselves for re-election. |
|
|
|
| ANYOTHER
BUSINESS |
|
|
| 5.
To transact any other business with the permission of the Chair. |
|
|
|
|
|
|
|
By Order of the Board. |
|
|
|
|
|
| Lahore |
|
(Shamshad A. Naushahi) |
|
| 4th
December, 2001 |
|
Company Secretary |
|
|
|
|
| NOTES: |
|
|
| 1.
The share transfer books of the company will remain closed from 21st
December, 2001 to 28th |
|
| December,
2001 (both days inclusive) |
|
|
|
|
|
|
| 2.
A member eligible to attend and vote at this meeting is entitled to appoint
another member as his / |
|
| her
proxy to attend and vote instead of him / her. A proxy must be a member of
the company. |
|
| Proxies
in order to be effective must be received at the registered office of the
company not later |
|
| than
48 hours before the meeting. |
|
|
|
|
| 3.
The corporate shareholders shall nominate someone to represent at the annual
general meeting. The |
|
| nominations,
in order to be effective must be received by the company not later than 48
hours before |
|
| the
time of holding the meeting. |
|
|
|
|
|
|
| 4.
Any individual Beneficial Owner of CDC, entitled to attend and vote at this
meeting, must bring |
|
| his/her
original NIC or passport, Account and participants' I.D. numbers to prove his
/ her identity, |
|
| and
in case of proxy must enclose an attested copy of his/her NIC or passport.
Representatives of |
|
| corporate
members should bring the usual documents required for such purpose. |
|
|
|
|
| 5.
Any person, who seeks to contest as Director of the company, whether he is
retiring or otherwise, must |
|
| file
with the company at the Registered office, a notice of his intention not
later than fourteen days before |
|
| the
Annual General Meeting in accordance with section 178(3) of the Companies
Ordinance, 1984. |
|
|
| 6.
Shareholders are requested to immediately notify change in address, if any,
to the company's share |
|
| registrar
M/s Softlink (Pvt.) Limited. |
|
|
|
|
| CHAIRMAN'S
REVIEW |
|
|
| During
the year under review, business situation remained difficult for our
products. Generally paint business was |
|
| in
difficulty which affected business of resin producers. NRL decided to
diversify in other specialty chemicals |
|
| manufacturing
in order to offset declining profitability in Alkyd resin business. |
|
|
| During
the year, there is a little increase in the sales over the previous year, but
the gross loss has been |
|
| reduced
by 57% during the period. Financial charges have been reduced by 31% as was
promised last year. Other |
|
| overheads
have gone up mainly due to general inflation whereas there is no increase in
salaries and |
|
| wages
bill of the company. Overall net loss before write-off of goodwill and
amortization of discount on shares is |
|
| 7%
less than the previous year. |
|
|
| As
indicated in half yearly accounts, we got the approval from Securities &
Exchange Commission of Pakistan |
|
| for
additional equity at discount and our parent company injected Rs.45 million
in the company out of which |
|
| Rs.32
million were injected prior to the balance sheet date. The equity is used
primarily for the repayment of |
|
| debts
and to augment working capital. This will further reduce the financial cost
in future. |
|
|
| During
the year RRP Limited merged with NRL. As per the scheme of arrangement, the
shareholders of RRP |
|
| Limited
had to receive one shares in Nimir Resins Limited for every share they were
holding in RRP Limited. The |
|
| shares
were subsequently issued in October 2001. |
|
|
| We
expect to divest our 25% shareholding in Nimir Chemicals (UAE) Limited,
Bermuda in near future at more |
|
| than
the par value. This will further improve the liquidity position of the
company and will further reduce debts |
|
| and
financial charges. |
|
|
| The
company has started production of chemicals for textile processing and paper
chemicals. Development |
|
| work
on some other specialty chemicals (plasticizers and saturates) is also in
progress and commercial production |
|
| is
expected in the second half of the coming year. These products are expected
to increase turnover inspire of the |
|
| fact
that the company competes with a large unorganized sector which is out of tax
net. We are trying to restrict |
|
| general
and selling expenses due to which we expect that the profitability of the
company will improve in year |
|
| 2002,
Insha Allah. |
|
|
| Lahore |
|
|
| 4th December, 2001 |
|
Chairman |
|
|
|
| DIRECTORS'
REPORT |
|
|
| Your
directors take this opportunity to present before you the 37th Annual Report
together with audited accounts of the |
|
| company
for the year ended 30th June 2001. |
|
|
|
|
| OPERATING
RESULTS |
|
2001 |
2000 |
|
|
|
|
Rupees |
Rupees |
|
| Loss
before tax, amortization of deferred cost |
|
|
|
| and
write-off of goodwill |
|
|
(48,420,744) |
(52,105,313) |
|
|
|
|
| Amortization
of deferred cost |
|
|
(16,500,000) |
- Nil - |
|
| Provision
for taxation |
|
|
(715,761) |
(709,940) |
|
| Write-off
of Goodwill |
|
|
(15,759,119) |
- Nil - |
|
|
|
|
------------------ |
------------------ |
|
| Net
Loss for the year |
|
|
(81,395,624) |
(52,815,253) |
|
| Accumulated
loss brought forward |
|
(280,573,381) |
(227,758,128) |
|
|
|
|
------------------ |
------------------ |
|
| Accumulated
loss carried forward |
|
|
(361,969,005) |
(280,573,381) |
|
|
------------------ |
------------------ |
|
|
| There
is a reduction of 7% in the net loss before amortization of deferred cost and
write-off of goodwill. However overall loss |
|
| increased
over the previous year due to the following two reasons: |
|
|
| *
Amortization of discount on shares issued during the current year at Rs.4/-
per share against the par value of Rs.10/- |
|
| per
share. The amount of discount is being amortized over five years being
non-cash expenditure. This expenditure |
|
| was
not reflected in the previous years. |
|
|
| *
Write-off of goodwill rose through the merger of RRP Limited. This represents
the difference between net assets of RRP Limited |
|
| at
book value and par value of shares issued to the shareholders of RRP Limited.
This is a non-recurring expenditure and will not |
|
| incur in future. |
|
|
| Due
to additional equity injected by the sponsors in the company and merger of
RRP Limited the balance sheet of the |
|
| company
improved substantially at the end of June 2001 as compared with the previous
year. |
|
|
| CHANGES
IN THE BOARD OF DIRECTORS |
|
| Since
the last review M/s Saeed-uz-Zaman, Louis Tucker Link and Cherif Sedky have
been appointed as directors of the company in |
|
| place
of resigning directors, M/s Mudassar Iqbal, Teck Soon Kong and Rashid Alkaff
respectively. |
|
|
| CHANGES
IN CHIEF EXECTIVESHIP |
|
| Since
the last review Mr. Saeed-uz-Zaman has been appointed as chief executive of
the company in place of Sh. Amar |
|
| Hameed. |
|
|
| AUDITORS |
|
| The
present retiring auditors M/s Ford, Rhodes, Robson, Morrow, Chartered
Accountants being eligible have offered |
|
| themselves
for reappointment. |
|
|
| PATTERN
OF SHAREHOLDING |
|
| A
pattern of shareholding of the Company is annexed. |
|
|
|
|
By Order of the Board |
|
| Lahore |
|
|
|
|
| 4th
December, 2001 |
|
Director |
|
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of Nimir Resins
Limited as at June 30, 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 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 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 accounts and are further in accordance with accounting policies
consistently |
|
| applied,
except for the changes mentioned in Note: 2.5 with which we concur: |
|
|
| 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, 2001 and of the loss, |
|
| its
cash flow and changes in equity for the year then ended; and |
|
|
|
|
| d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr
Ordinance, 1980 (XVIII of |
|
| 1980). |
|
|
|
|
|
|
Chartered Accountants |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 2001 |
|
|
|
|
Note |
2001 |
2000 |
|
|
|
|
Rupees |
Rupees |
|
| CAPITAL
AND LIABILITIES |
|
| Share
Capital & Reserves |
|
| Authorised
Capital |
|
| 55,000,000
(2000: 45,000,000) Ordinary Shares of |
|
| Rs. 10/- each |
|
|
|
550,000,000 |
450,000,000 |
|
|
|
========== |
========== |
|
|
|
|
| Issued,
Subscribed and Paid Up Capital |
3 |
419,322,430 |
269,322,430 |
|
| Shares
under issue |
|
4 |
26,512,470 |
-- |
|
| Share
Premium Reserves |
|
|
1,958,902 |
2,358,637 |
|
| Share
Deposit Money |
|
|
32,628,400 |
30,783,791 |
|
| Accumulated
Losses |
|
|
(361,969,005) |
(280,573,381) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
118,453,197 |
21,691,477 |
|
|
| LONG
TERM LOANS |
|
5 |
26,961,581 |
44,241,091 |
|
|
|
|
| LIABILITIES
AGAINST ASSETS SUBJECT |
|
|
| TO
FINANCE LEASE |
|
6 |
193,903 |
319,351 |
|
| DEFERRED
LIABILITIES |
|
7 |
1,256,695 |
1,256,695 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Current
maturity of long term loans |
5 |
36,368,591 |
27,672,342 |
|
| Current
maturity of liabilities against |
|
|
| assets
subject to finance lease |
|
6 |
108,712 |
171,442 |
|
| Short
term finances |
|
8 |
46,364,749 |
77,064,476 |
|
| Creditors,
accrued & other liabilities |
9 |
75,861,001 |
54,142,052 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
158,703,053 |
159,050,312 |
|
| CONTINGENCIES
AND COMMITMENTS |
10 |
-- |
-- |
|
|
------------------ |
------------------ |
|
|
305,568,429 |
226,758,926 |
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
| Lahore |
|
| 4th
December 2001 |
|
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
|
| At
cost-Less accumulated depreciation |
11 |
141,737,825 |
155,113,696 |
|
| Capital
work in progress |
|
|
5,310 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
141,743,135 |
155,113,696 |
|
|
| INTANGIBLE
ASSETS - GOODWILL |
12 |
-- |
-- |
|
| LONG
TERM DEPOSITS |
|
13 |
1,040,165 |
931,165 |
|
| LONG
TERM LOANS |
|
14 |
-- |
5,500 |
|
| LONG
TERM INYESTMENTS |
|
15 |
-- |
52,400 |
|
| DEFERRED
COST |
|
16 |
73,500,000 |
-- |
|
|
|
|
|
|
| CURRENT
ASSETS |
|
| Stores
and spares |
|
|
156,399 |
-- |
|
| Stock in trade |
|
17 |
19,228,872 |
20,466,230 |
|
| Trade debtors |
|
18 |
39,857,669 |
32,365,757 |
|
| Advances,
deposits, prepayments |
|
|
| &
other receivables |
|
19 |
15,087,832 |
16,962,921 |
|
| Short
term investments |
|
20 |
13,000,000 |
-- |
|
| Cash
& bank balances |
|
21 |
1,954,357 |
861,257 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
89,285,129 |
70,656,165 |
|
|
|
|
------------------ |
------------------ |
|
|
305,568,429 |
226,758,926 |
|
|
|
========== |
========== |
|
|
|
Chief Executive |
|
Director |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
Note |
2001 |
2000 |
|
|
|
|
Rupees |
Rupees |
|
|
|
|
| Sales |
|
22 |
142,774,771 |
136,678,745 |
|
| Cost of sales |
|
23 |
(144,472,123) |
(140,669,544) |
|
|
|
|
------------------ |
------------------ |
|
| Gross loss |
|
|
(1,697,352) |
(3,990,799) |
|
| Administrative,
selling and general expenses |
24 |
(22,217,117) |
(18,761,004) |
|
|
|
|
------------------ |
------------------ |
|
| Operating loss |
|
|
(23,914,469) |
(22,751,803) |
|
| Financial
charges |
|
25 |
(19,687,997) |
(28,426,118) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(43,602,466) |
(51,177,921) |
|
| Other income |
|
26 |
7,037 |
3,118,062 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(43,595,429) |
(48,059,859) |
|
| Other
charges and provision |
|
77 |
(4,825,315) |
(4,045,454) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(48,420,744) |
(52,105,313) |
|
|
| Amortization
of Deferred cost |
|
16 |
(16,500,000) |
-- |
|
|
|
|
------------------ |
------------------ |
|
| Loss
before taxation |
|
|
(64,920,744) |
(52,105,313) |
|
| Provision
for taxation |
|
28 |
(715,761) |
(709,940) |
|
|
|
|
------------------ |
------------------ |
|
| Loss
after taxation |
|
|
(65,636,505) |
(52,815,253) |
|
| Write
off - Goodwill |
|
12 |
(15,759,119) |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(81,395,624) |
(52,815,253) |
|
|
| Unappropriated
loss brought forward |
|
(280,573,381) |
(227,758,128) |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
loss carried forward |
|
(361,969,005) |
(280,573,381) |
|
|
|
========== |
========== |
|
| Earnings
per share (Rs.) |
|
29 |
(1.69) |
(1.96) |
|
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
Chief Executive |
|
Director |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
|
2001 |
2000 |
|
|
|
|
Rupees |
Rupees |
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Net
loss before taxation |
|
|
(64,920,744) |
(52,105,313) |
|
|
| Adjustment for: |
|
| Loss
on disposal of fixed assets |
|
101,672 |
-- |
|
| Depreciation |
|
13,741,487 |
15,162,755 |
|
| Financial
expenses |
|
19,687,997 |
28,426,118 |
|
| Investment
written off - Merger |
|
52,400 |
-- |
|
| Stocks
written off |
|
-- |
361,424 |
|
| Provision
for gratuity |
|
-- |
56,847 |
|
| Amortisation
of deferred cost |
|
16,500,000 |
-- |
|
| Provision
for doubtful debts |
|
3,000,000 |
2,000,000 |
|
| Fixed
assets scrapped |
|
-- |
1,684,030 |
|
|
|
------------------ |
------------------ |
|
|
|
53,083,556 |
47,691,174 |
|
|
|
------------------ |
------------------ |
|
| OPERATING
LOSS BEFORE CHANGES IN WORKING CAPITAL |
(11,837,188) |
(4,414,139) |
|
|
|
| WORKING
CAPITAL CHANGES |
|
| (Increase)/decrease
in current assets |
|
| Stores,
spares and loose tools |
|
(156,399) |
-- |
|
| Stock in trade |
|
1,237,358 |
9,087,716 |
|
| Trade debts |
|
(10,491,912) |
(1,272,753) |
|
| Advances,
deposits, prepayments and other receivables |
(140,607) |
1,710,633 |
|
|
|
------------------ |
------------------ |
|
|
|
(9,551,560) |
9,525,596 |
|
| Increase/(decrease)
in current liabilities |
|
| Short
term finances |
|
(30,699,727) |
(6,958,200) |
|
| Creditors,
accrued and other liabilities |
|
12,822,189 |
5,740,412 |
|
|
|
------------------ |
------------------ |
|
|
|
|
(17,877,538) |
(1,217,788) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(27,429,098) |
8,307,808 |
|
|
| CASH
GENERATED FROM OPERATIONS |
|
(39,266,286) |
3,893,669 |
|
|
| Financial
expenses paid |
|
(13,626,926) |
(28,487,087) |
|
| Tax Paid |
|
|
1,647,286 |
(107,884) |
|
|
|
------------------ |
------------------ |
|
|
|
(11,979,640) |
(28,594,971) |
|
|
|
------------------ |
------------------ |
|
| NET
CASH GENERATED FROM OPERATING ACTIVITIES |
(51,245,926) |
(24,701,302) |
|
|
| Balance
brought forward. |
|
|
(51,245,926) |
(24,701,302) |
|
|
|
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
|
|
| Addition
to fixed assets |
|
|
(979,999) |
(1,513,171) |
|
| Sale
proceeds of fixed assets |
|
|
507,400 |
-- |
|
| Long term loans |
|
|
51,750 |
28,800 |
|
| Long
term deposits |
|
|
(68,065) |
-- |
|
| Cash
acquired on merger |
|
|
154,505 |
-- |
|
|
------------------ |
------------------ |
|
| NET
CASH USED IN INVESTING ACTIVITIES |
|
(334,409) |
(1,484,371) |
|
|
------------------ |
------------------ |
|
|
|
|
(51,580,335) |
(26,185,673) |
|
|
|
