| National Tanneries of Pakistan Limited |
|
|
|
|
|
|
| Annual
Report 2001 |
|
|
| CONTENTS |
|
|
| BOARD
OF DIRECTORS |
|
| NOTICE
OF MEETING |
|
| DIRECTORS'
REPORT |
|
| AUDITORS'
REPORT |
|
| BALANCE
SHEET |
|
| PROFIT
AND LOSS ACCOUNT |
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| STATEMENT
OF CHANGES IN EQUITY |
|
| NOTES
TO THE ACCOUNTS |
|
| PATTERN
OF SHARES HELD BY THE SHAREHOLDERS |
|
|
|
|
|
|
|
| BOARD
OF DIRECTORS: |
|
|
| SH.
ANWER IQBAL - Chief Executive |
|
| SH,
ARSHAD IQBAL |
|
| SH.
GHALIB JAVED |
|
| MRS.
RAFIA KHANAM |
|
| MRS.
TAHERA ARSHAD |
|
| MRS.
NOOR US SABA |
|
| MRS,
SAIMA ASIM |
|
|
| AUDITORS: |
|
| M/S.
FAZAL MAHMOOD & COMPANY |
|
| Chartered
Accountants |
|
| 147-Shadman
Colony-I, Lahore. |
|
|
| BANKERS: |
|
| ALBARAKA
ISLAMIC BANK LIMITED B.S.C. (E.C.) |
|
| HABIB
BANK A. G. ZURICH |
|
| MUSLIM
COMMERCIAL BANK LIMITED |
|
| UNITED
BANK LIMITED |
|
| PICIC
COMMERCIAL BANK LIMITED |
|
| BANK
ALFALAH LIMITED |
|
|
| REGISTERED
OFFICE: |
|
| 17-J, Gulberg-III, |
|
| Lahore. |
|
|
| FACTORIES: |
|
| G.
T. Road, Muridke/Khori |
|
| (District
Sheikhupura) |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
|
| Notice
is hereby given that the 41st Annual General Meeting of the Shareholders of |
|
| NATIONAL
TANNERIES OF PAKISTAN LIMITED will be held at the Registered Office of the
Company |
|
| 17-J,
Gulberg-III, Lahore on Monday 31st December, 2001 at 09.00 a.m. to transact
the following |
|
| business: |
|
|
| 1.
To confirm the minutes of the last Annual General Meeting held on 30-12-2000
and Extra |
|
| Ordinary
General Meeting held on 23-05-2001. |
|
|
| 2.
To receive, consider and adopt the Directors' and Auditors' reports and
audited accounts for the |
|
| year
ended 30th June, 2001. |
|
|
| 3.
To approve payment of cash dividend @ Re. 1.00 per share i.e. 10% as
recommended by the |
|
| Directors. |
|
|
| 4
To appoint auditors for the financial year 2001-2002 and fix their
remuneration. |
|
|
| 5.
To elect seven directors for the next term of three years. The Board of
Directors has fixed number |
|
| of
elected directors including Chief Executive as seven in terms of Companies
Ordinance, 1984. |
|
| The
following retiring directors being eligible have filed with the Company,
their intention to offer |
|
| themselves
for re-election. Mr. M. Rahim Arshad has also filed his intention to offer
himself for |
|
| election
as Director of the Company in place of Mrs. Saima Asim. |
|
|
| 1.
Mr. Sh. Anwer Iqbal |
2. Mr. Sh. Arshad Iqbal |
|
|
| 3.
Mr. Sh. Ghalib Javed |
4. Mrs. Raffia Khanam |
|
|
| 5.
Mrs. Tahera Arshad |
6. Mrs. Noor us Saba |
|
|
|
|
|
| In
case number of persons contesting the election does not exceed seven the
above noted |
|
| persons
shall be deemed as elected directors in the AGM. |
|
|
| 6.
To transact any other business with the prior permission of the Chairman. |
|
|
| The
share transfer books of the Company will remain closed from 25th December,
2001 to 31st |
|
| December,
2001 (both days inclusive). |
|
|
|
|
|
|
|
|
By Order of the Board |
|
|
|
|
|
|
| Lahore: |
|
|
(ANWAR-UL-HAQ) |
|
| 24th
November, 2001. |
|
Company Secretary |
|
|
| NOTES: |
|
|
| 1.
A member entitled to attend and vote at this meeting may appoint another
member as a proxy to |
|
| attend
and vote instead of him. Proxies in order to be valid must be received at
Registered Office |
|
| of
the Company not less than 48 hours before the meeting. |
|
|
| 2.
Shareholders are requested to notify the Company of any change in their
addresses immediately. |
|
|
| 3.
A member intending to contest the election shall file with the Company, not
later than 14 days |
|
| before
the date of the meeting, his intention to offer himself for election as
director. |
|
|
|
| DIRECTORS'
REPORT TO THE SHAREHOLDERS |
|
|
| The
Directors of the Company are pleased to present the 41st Annual Report
alongwith audited |
|
| accounts
for the year ended 30th June, 2001. |
|
|
| The
Directors of your Company are pleased to report that your Company has made
extra efforts to |
|
| increase
export sales. This year export sales increased to Rs. 296,283,664 as compared
with last year |
|
| export
sales of Rs. 269,288,148 and profit after taxation for the year increased to
Rs. 3,546,045 as |
|
| compared
with the previous year profit after taxation Rs. 2,655,495. Earning per share
is Rs. 2.03 for |
|
| the
year under report as compared with previous year Rs. 1.52. The Directors of
the Company are |
|
| doubtful
to maintain export sales in next year due present conditions. |
|
|
| Auditors
M/s. Fazal Mahmood & Co., Chartered Accountants have retired and being
eligible have |
|
| offered
themselves for re-appointment. |
|
|
| The
current profit has been appropriated as under: |
|
|
|
|
|
Rupees |
|
|
| Profit
before taxation |
|
6,036,187 |
|
| Taxation |
|
|
2,490,142 |
|
|
|
|
------------------ |
|
| Profit/(Loss)
after taxation |
|
3,546,045 |
|
| Unappropriated
profit brought forward |
|
7,860,360 |
|
|
|
|
------------------ |
|
| Total
profit available for appropriation |
|
11,406,405 |
|
|
| Appropriated
to: |
|
|
| Proposed
dividend |
|
|
1,749,600 |
|
|
|
|
------------------ |
|
| Balance
carried forward |
|
|
9,656,805 |
|
|
========== |
|
|
| The
management continued cordial and co-operative relations with the employees of
the Company. |
|
| Pattern
of shareholding is annexed. |
|
|
|
|
On behalf of the Board |
|
|
|
|
|
|
| Lahore: |
|
|
(SH. ANWER IQBAL) |
|
| 24th
November, 2001. |
|
Chief Executive |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of NATIONAL
TANNERIES OF PAKISTAN 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 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 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 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 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 profit, its cash flows 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. |
|
|
|
|
|
|
FAZAL MAHMOOD & COMPANY |
|
| Lahore
· 24th November, 2001. |
|
Chartered Accountants |
|
|
|
| BALANCE
SHEETAS AT JUNE 30, 2001 |
|
|
|
|
|
2001 |
2000 |
|
| CAPITAL
AND LIABILITIES |
|
Not |
Rupees |
Rupees |
|
|
|
| SHARE
CAPITAL |
|
|
| Authorised: |
|
| 2,000,000
Ordinary shares of |
|
| Rs. 10/- each |
|
|
20,000,000 |
20,000,000 |
|
|
========== |
========== |
|
| Issued,
Subscribed and paid Up: |
|
2 |
17,496,000 |
17,496,000 |
|
|
|
|
|
|
|
| RESERVES |
|
|
|
| Share
premium account |
|
3 |
8,748,000 |
8,748,000 |
|
| Revenue
reserve |
|
4 |
24,000,000 |
24,000,000 |
|
| Assets
replacement reserve |
|
|
5,000,000 |
5,000,000 |
|
| Unappropriated
profit |
|
|
9,656,805 |
7,860,360 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
47,404,805 |
45,608,360 |
|
|
|
|
|
| DEFERRED
LIABILITIES |
|
|
|
| Deferred
Taxation |
|
5 |
1,045,500 |
1,045,500 |
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Short
term finances |
|
6 |
185,862,028 |
143,325,650 |
|
| Loan
from directors and their relatives |
7 |
31,820,271 |
25,120,703 |
|
| Creditors,
accruals and other liabilities |
8 |
62,908,983 |
21,064,784 |
|
| Provision
for taxation |
|
9 |
2,485,000 |
1,500,000 |
|
| Proposed
dividend |
|
10 |
1,749,600 |
1,749,600 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
284,825,882 |
192,760,737 |
|
|
------------------ |
------------------ |
|
| CONTINGENCIES
AND COMMITMENTS |
11 |
-- |
-- |
|
|
|
|
|
350,772,187 |
256,910,597 |
|
|
|
|
========== |
========== |
|
|
| These
financial statements should be read in conjunction with the annexed notes. |
|
|
| Lahore: |
|
|
SH. ANWER IQBAL |
|
| 24th
November, 2001. |
|
Chief Executive |
|
|
| PROPERTY
AND ASSETS |
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating
assets |
|
12 |
26,208,587 |
31,030,579 |
|
| LONG
TERM DEPOSITS |
|
|
64,980 |
64,980 |
|
|
|
|
| CURRENT
ASSETS |
|
| Stores
and spares |
|
13 |
26,973,873 |
27,013,016 |
|
| Stocks |
|
14 |
218,993,387 |
133,657,884 |
|
| Trade debtors |
|
15 |
45,571,382 |
29,127,056 |
|
| Advances,
Deposits and |
|
|
|
| Other
receivables |
|
16 |
32,057,977 |
20,383,247 |
|
| Cash
and bank balances |
|
17 |
902,001 |
15,633,835 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
324,498,620 |
225,815,038 |
|
|
------------------ |
------------------ |
|
|
|
350,772,187 |
256,910,597 |
|
|
========== |
========== |
|
|
|
|
|
|
SH. ARSHAD IQBAL |
|
|
|
DIRECTOR |
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
2001 |
2000 |
|
|
Not |
Rupees |
Rupees |
|
|
| Sales - Net |
|
18 |
301,263,478 |
274,440,960 |
|
| Cost of Sales |
|
19 |
256,080,102 |
233,298,485 |
|
|
|
|
------------------ |
------------------ |
|
| GROSS PROFIT |
|
|
45,183,376 |
41,142,475 |
|
| Other income |
|
20 |
675,256 |
117,558 |
|
|
|
|
------------------ |
------------------ |
|
|
45,858,632 |
41,260,033 |
|
|
|
|
| Operating
expenses |
|
|
|
| Administrative |
|
21 |
13,433,303 |
10,687,468 |
|
| Auditors'
remuneration |
|
22 |
92,000 |
92,000 |
|
| Selling
and distribution |
|
23 |
11,587,495 |
9,847,164 |
|
| Financial |
|
24 |
14,264,875 |
13,232,966 |
|
|
------------------ |
------------------ |
|
|
|
39,377,673 |
33,859,598 |
|
|
|
------------------ |
------------------ |
|
| OPERATING
PROFIT |
|
|
6,480,959 |
7,400,435 |
|
|
|
|
| Deductions
for other charges: |
|
| Workers'
profit participation fund |
|
|
324,048 |
370,022 |
|
| Workers'
welfare fund |
|
|
120,724 |
137,851 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
444,772 |
507,873 |
|
|
|
------------------ |
------------------ |
|
| PROFIT
FOR THE YEAR |
|
|
6,036,187 |
6,892,562 |
|
|
|
|
|
|
| TAXATION |
|
|
|
| Current |
|
9 |
2,485,000 |
1,500,000 |
|
| Prior |
|
|
5,142 |
2,737,067 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
2,490,142 |
4,237,067 |
|
|
|
|
------------------ |
------------------ |
|
| PROFIT
AFTER TAXATION |
|
|
3,546,045 |
2,655,495 |
|
| Previous
year balance brought forward |
|
7,860,360 |
6,954,465 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
available for appropriation |
|
|
11,406,405 |
9,609,960 |
|
|
|
|
|
|
| Appropriated
to: |
|
|
|
| Proposed
dividend |
|
10 |
1,749,600 |
1,749,600 |
|
|
|
|
------------------ |
------------------ |
|
| Balance
Carried to Balance Sheet |
|
|
9,656,805 |
7,860,360 |
|
|
|
|
========== |
========== |
|
| Basic
and Diluted Earning per share |
25 |
2.03 |
1.52 |
|
|
|
|
========== |
========== |
|
|
| These
financial statements should be read in conjunction with the annexed notes. |
|
|
|
|
| Lahore: |
|
SH. ANWER IQBAL |
|
SH. ARSHAD IQBAL |
|
| 24th
November, 2001. |
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
2001 |
2000 |
|
|
|
Rupees |
Rupees |
|
| CASH
FLOWS FROM OPERATING ACTIVITIES |
|
| Profit
before taxation |
|
6,036,187 |
6,892,562 |
|
| Adjustments
for: |
|
|
|
| Depreciation |
|
2,761,963 |
3,364,093 |
|
| Financial
Charges |
|
13,578,589 |
12,632,835 |
|
| (Gain)/Loss
on disposal of fixed assets |
|
(675,256) |
2,809 |
|
|
|
------------------ |
------------------ |
|
| Cash
flow from operating activities |
|
|
|
| before
working capital changes |
|
21,701,483 |
22,892,299 |
|
| Adjustments
for working capital changes: |
|
| (Increase)/Decrease
in Current Assets |
|
| Stores
and spares |
|
39,143 |
3,681,363 |
|
| Stocks |
|
(85,335,503) |
24,538,306 |
|
| Trade debtors |
|
(16,444,326) |
(28,198,957) |
|
| Advances,
Deposits and Other receivables |
|
(11,707,730) |
(2,723,786) |
|
|
|
------------------ |
------------------ |
|
|
|
(113,448,416) |
(2,703,074) |
|
|
| (Decrease)/Increase
in Current Liabilities |
|
| Short
Term Finances |
|
42,536,378 |
24,277,835 |
|
| Loan
from directors and their relatives |
|
6,699,568 |
(7,310,953) |
|
| Creditors,
Accrued and other liabilities |
|
42,318,866 |
(1,930,293) |
|
|
|
------------------ |
------------------ |
|
|
|
91,554,812 |
15,036,589 |
|
|
|
------------------ |
------------------ |
|
| Cash
utilized/generated from Operations |
|
(192,121) |
35,225,814 |
|
| Financial
charges paid |
|
(14,003,246) |
(12,602,087) |
|
| Income Tax Paid |
|
(1,555,845) |
(3,892,067) |
|
|
|
------------------ |
------------------ |
|
|
|
(15,559,091) |
(16,494,154) |
|
|
|
------------------ |
------------------ |
|
| Net
Cash (outflow)/inflow from Operating Activities |
(15,751,212) |
18,731,660 |
|
|
========== |
========== |
|
|
| CASH
FLOWS FROM INVESTING ACTIVITIES |
|
| Sale
proceeds of fixed assets |
|
3,076,586 |
215,000 |
|
| Fixed
capital expenditure |
|
(308,301) |
(2,164,414) |
|
|
|
------------------ |
------------------ |
|
| Net
Cash inflow/(outflow) from Investing Activities |
|
2,768,285 |
(1,949,414) |
|
|
|
|
========== |
========== |
|
|
|
|
| CASH
FLOWS FROM FINANCING ACTIVITIES |
|
| Dividend paid |
|
|
(1,748,907) |
(1,739,627) |
|
| Net
Cash (out flow) from Financing Activities |
|
(1,748,907) |
(1,739,627) |
|
|
|
|
------------------ |
------------------ |
|
| NET
(OUT FLOW)/INFLOW OF CASH |
|
(14,731,834) |
15,042,619 |
|
| CASH
AT BEGINNING OF THE YEAR |
|
15,633,835 |
591,216 |
|
|
|
|
------------------ |
------------------ |
|
| CASH
AT END OF THE YEAR |
|
|
902,001 |
15,633,835 |
|
|
|
|
========== |
========== |
|
|
| Lahore: |
|
SH. ANWER IQBAL |
|
SH. ARSHAD IQBAL |
|
| 24th
November, 2001. |
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN EQUITY |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
Paid up |
|
Assets |
Un-appro- |
|
|
|
ordinary |
Share |
Revenue |
replace- |
priated |
|
|
|
share |
Premium |
Reserve |
ment |
profit |
Total |
|
|
capital |
|
reserve |
|
|
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
Rupees |
|
|
|
|
| Balance
at July 01, 1999 |
17,496,000 |
8,748,000 |
24,000,000 |
5,000,000 |
6,954,465 |
62,198,465 |
|
|
|
|
|
| After
tax profit for the |
|
|
| year
ended June 30, 2000 |
-- |
-- |
-- |
-- |
2,655,495 |
2,655,495 |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
|
17,496,000 |
8,748,000 |
24,000,000 |
5,000,000 |
9,609,960 |
64,853,960 |
|
|
|
|
|
| Dividends |
|
-- |
-- |
-- |
-- |
(1,749,600) |
(1,749,600) |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
| Balance
at June 30, 2000 |
17,496,000 |
8,748,000 |
24,000,000 |
5,000,000 |
7,860,360 |
63,104,360 |
|
|
|
|
| After
tax profit for the |
|
| year
ended June 30, 2001 |
-- |
-- |
-- |
-- |
3,546,045 |
3,546,045 |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
|
|
17,496,000 |
8,748,000 |
24,000,000 |
5,000,000 |
11,406,405 |
66,650,405 |
|
|
|
|
| Dividend
- Proposed |
-- |
-- |
-- |
-- |
(1,749,600) |
(1,749,600) |
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
------------------ |
|
| Balance
at June 30, 2001 |
17,496,000 |
8,748,000 |
24,000,000 |
5,000,000 |
9,656,805 |
64,900,805 |
|
|
|
========== |
========== |
========== |
========== |
========== |
========== |
|
|
| Lahore: |
|
SH. ANWER IQBAL |
|
SH. ARSHAD IQBAL |
|
| 24th
November, 2001. |
Chief Executive |
|
Director |
|
|
|
|
|
| NOTES
TO THEACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
| 1.
THE COMPANY AND ITS OPERATIONS |
|
| The
Company is incorporated as a public limited company in Pakistan and is quoted
on Lahore |
|
| and
Karachi Stock Exchanges in Pakistan and principally engaged in the business
of |
|
| manufacture
of leather and leather garments. |
|
|
|
|
| NOTE |
|
|
| 1.
ACCOUNTING POLICIES |
|
|
|
| The
principal accounting policies adopted in the preparation of the Company's
accounts are |
|
| consistent
with those of the previous year, except where otherwise stated, and are as
follows |
|
|
|
| 1.1
Provision for staff gratuity: |
|
|
|
| Provision
for staff gratuity is not made as provident fund trust has been established
since |
|
| January,
1966. The provident fund scheme covers all the employees of the Company. |
|
|
|
|
| 1.2
Staff retirement benefits: |
|
|
|
| The
Company has a recognized provident fund scheme which covers all the employees
of the |
|
| Company. |
|
|
|
|
| 1.3 Taxation: |
|
|
| Provision
for current taxation for the year is based on taxable income at the current
rates of |
|
