| WorldCALL Multimedia Limited |
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| Annual
Report 2001 |
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| CONTENTS |
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| Company
Information |
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| Notice
of Annual General Meeting |
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| Chairman's
Review |
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| Directors'
Report to the Members |
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| Auditors
Report to the Members |
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| Balance Sheet |
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| Cash
Flow Statement |
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| Statement
of Changes in Equity |
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| Notes
to the Accounts |
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| Statement
under Section 237 of Companies Ordinance, 1984 |
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| Pattern
of Shareholding |
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| WorldCALL
Dot Cam (Pvt.) Limited |
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| Consolidated
Financial Statement |
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| Financial
Statements |
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| For
The Year Ended |
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| June
30, 2001 |
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| COMPANY
INFORMATION |
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| Board
of Directors |
Salmaan Taseer |
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Chairman |
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Humayun Khan Bangash |
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Chief Executive |
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Mumtaz H. Syed |
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Mian Ehsan ul Haq |
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Fazeel Asif Jah |
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Nasir Iqbal |
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Lane P. Pendleton |
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| Company
Secretary |
Sardar Ali Watoo |
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| Auditors |
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Ford, Rhodes, Robson,
Morrow |
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Chartered Accountants |
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| Legal Advisor |
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Imtiaz Siddiqui &
Associates |
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Advocates, Lahore |
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| Bankers |
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Prime Commercial Bank
Limited |
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Standard Chartered Bank |
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Faysal Bank Limited |
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Allied Bank Limited |
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United Bank Limited |
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| Share
Registrar Office |
THK Associates (Pvt.)
Limited |
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Ground Floor |
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Sheikh Sultan Trust
Building No.2 |
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Beaumont Road Karachi |
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Ph. 021-5689021 |
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| Registered
Office/Head Office |
103-C-/11, Gulberg-III |
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Lahore, Pakistan |
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Ph: 042-5757591-4 |
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Fax: 042-5757590 |
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| Project Office |
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50-Bridge Colony |
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Lahore, Cantt, Pakistan |
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Ph: 042-6686227-8 |
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Fax: 042-6669095 |
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| NOTICE
OF ANNUAL GENERAL MEETING |
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| Notice
is hereby given that the 2nd Annual General Meeting of the shareholders of |
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| WORLDCALL
MULTIMEDIA LIMITED will be held on December 26, 2001 at
10:30 a.m. at the |
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| registered
office of the company, 103-C/11, Gulberg-III, Lahore to transact the
following |
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| business: |
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| Ordinary
Business: |
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| 1.
To approve the minutes of last Extra Ordinary General Meeting; |
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| 2.
To receive, consider and adopt the Financial Statements of the Company for
the |
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| year
ended June 30, 2001 together with the Directors' and Auditors' Reports
thereon; |
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| 3.
To appoint Auditors for the year ending June 30, 2002 and fix their
remuneration; |
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| 4.
To transact any other business with the permission of the Chair. |
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By Order of the Board |
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| Lahore |
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Sardar Ali Wattoo |
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| December
05, 2001 |
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Company Secretary |
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| Notes: |
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| 1)
The Members Register will remain closed from December 20,2001 to December 26, |
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| 2001
(both days inclusive). Transfers received at THK Associates (Pvt.) Limited,
Ground |
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| Floor,
Sheikh Sultan Trust Building No. 2, Beaumont Road, Karachi, the Registrar and |
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| Share
Transfer Office of the Company, by the close of business on December 19. 2001 |
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| will
be treated in time. |
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| 2)
A member eligible to attend and vote at the meeting may appoint another
member |
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| as
proxy to attend and vote in the meeting. Proxies in order to be effective
must be |
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| received
by the company at the Registered Office not later than 48 hours before the |
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| time
for holding the meeting. |
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| 3)
In order to be valid, an instrument of proxy and the power of attorney or
other authority |
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| (if
any) under which it is singed, or a notarially certified copy of such power
of attorney, |
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| must
be deposited at the registered office of the company, 103-C/11, Gulberg-III, |
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| Lahore,
not less than 48 hours before the time of the meeting. |
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| 4
a) Individual beneficial owners of CDC entitled to attend and vote at the
meeting must |
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| bring
his/her participant ID and account/sub-account number along with original NIC |
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| or
passport to authenticate his/her identity. In case of Corporate entity,
resolution of |
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| the
Board of Directors/Power of attorney with specimen of nominees shall be
produced |
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| (unless
provided earlier) at the time of meeting. |
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| 4
b) For appointing of proxies, the individual beneficial owners of CDC shall
submit the |
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| proxy
form as per above requirement along with participant ID and account/sub- |
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| account
number together with attested copy of their NIC or Passport. The proxy form |
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| shall
be witnessed by two witnesses with their names, addresses and NIC numbers. |
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| The
proxy shall produce his/her original NIC or Passport at the time of meeting.
In case |
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| of
Corporate entity, resolution of the Board of Directors/Power of attorney
along with |
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| specimen
signatures shall be submitted (unless submitted earlier) along with the proxy |
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| form. |
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| 5.
Members are requested to notify any change in their registered address
immediately. |
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| It
gives me great pleasure to present the 2nd annual report of WorldCALL
Multimedia Ltd. |
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| (WML)
and the annual audited accounts for the period ending June 30, 2001. More so
for |
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| the
unparalleled feat WML has accomplished by setting up the first-ever Hybrid
Fibre Coaxial |
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| Network
in Pakistan. It is a moment of pride for us that WML has established a
broadband |
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| network
that stands at the cutting edge of technology. I am delighted to announce
that |
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| WML
held its IPO in November 2001, and will be listed on the Karachi and Lahore
Stock |
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| Exchange
shortly. |
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| WML
began exploring the opportunity of setting up a Cable TV service once the
Pakistan |
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| Telecommunication
Authority advertised for licenses. WML drew upon the technical expertise |
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| and
resources available within the WorldCALL Communications Group to develop a |
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| company
with a vision for the future. A company that employed state of the art
equipment |
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| and
would allow users to an unrivalled broadband interactive experience. With
this vision |
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| in
mind we began planning a network for Lahore. Our engineers and technical
staff worked |
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| endlessly
to roll out the network in record time. |
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| The
network in Lahore has been designed to initially cater to a market of 65,000
houses. |
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| The
houses are connected to the company's central facility via fibre optic and
coaxial |
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| cable.
The fibre optic route is 110 kms in length. The combination of fibre and
coaxial cables, |
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| known
as Hybrid Fibre Coaxial, gives the network tremendous data transferring
capacity. |
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| Last
year in August WML began test transmission of its Cable TV service to a small
group |
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| of
residents. Owing to the superior quality of Cable TV service, there has been
a tremendous |
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| response
from the public. |
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| In
the months to come, WML will launch a host of interactive services. The
foremost of these |
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| being
its Internet service that is due to begin by December 2001.
Internet-over-Cable is a |
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| truly
new phenomenon in Pakistan, and will give users broadband access to the World |
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| Wide
Web. The service promises to be many times faster the existing dial-up access
currently |
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| available.
WorldCALL Dot Corn (Pvt) Ltd. (WCDC), a wholly owned subsidiary of WML, will |
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| provide
this service in collaboration with WML. Attaching a set top box with your
cable line |
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| will
also allow Internet usage over TV. This provides an affordable solution for
users that do |
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| not
have computers. |
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| In
future a host of broadband interactive services such as video on demand,
security |
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| services,
video conferencing, pay-per-view, distance learning, data and community
services, |
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| and
even telephone will be rolled out, subject to regulatory approvals. This will
ensure |
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| multiple
revenue streams in the future. Competing coaxial cable networks do not allow
for |
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| such
services due to their non-interactive nature. This places WML at a
significant advantage |
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| to
other cable operators. |
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| WML
has made a laudable effort in securing international investment from high net
worth |
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| international
investors and fund management companies. Foreign investors have made |
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| sizable
investments both as sponsors and Pre-IPO investors. In a backdrop of drying |
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| international
investment, WML has made a significant contribution to the Government of |
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| Pakistan's
objective of attracting foreign direct investment. Pt also speaks of the
faith of |
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| international
investors in the management of WML. |
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| We
at WML have invested heavily in technology and in acquiring the necessary
expertise |
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| to
run such a project. We are confident that our human resource and
technological know |
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| how
is unmatched. Coupled with that is the stellar track record of our WorldCALL |
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| Communications
Group to which this company belongs. As WML unveils its interactive |
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| services
its superiority over rivals will become clearer. |
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| I
congratulate the Board of Directors, the management, and our employees whose
efforts |
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| have
made WML a success. I have faith that in the year to come, WML will attain
higher |
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| grounds. |
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|
Salmaan Taseer |
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|
Chairman |
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| DIRECTOR'
REPORT |
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| It
gives us pleasure to present the 2nd annual report of the Company and annual
audited |
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| accounts
for the period ending June 30, 2001. |
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| July
2000- June 2001: An Overview |
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| WorldCALL
Multimedia Ltd. (WML) is the first ever private sector company to set up a |
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| broadband
Hybrid Fibre Coaxial network in Pakistan. It is a landmark achievement not
only |
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| in
that there is no parallel set up in the country, but also that network
rollout has been in |
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| record
time. Even more encouraging is that WML relied solely in-house manpower and |
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| technical
expertise to accomplish the task. Later, the network was audited by an
international |
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| technical
consultant and found to be of world class standard. The project is based on
the |
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| state-of
the art equipment and technology and promises to make Lahore a hub of
Information |
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| Technology
in Asia. |
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| The
project will initially provide broadband access to 65,000 houses in Lahore.
The network |
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| combines
110 kms of fibre optic, which serves as the backbone transmission line, with
an |
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| extravagant
coaxial network that terminates at the subscribers' premises. During the
period |
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| under
review, WML began its test transmission in select localities of Lahore. The
response |
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| from
the subscribers has been favourable. |
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| WML
launched its service with an 80-channel cable TV service 'World of Magic'
featuring |
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| crisp
and high quality sound and picture. By the end of the year, we expect that
WML will |
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| begin
offering its Internet-over-Cable service another first by WML. The 'always
on' Internet |
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| service
will provide users with broadband access capability. This means faster
surfing and |
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| download
speeds than currently available through an ordinary dial-up connection and |
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| furthermore
it frees the users ordinary telephone line. The Cable Modem Termination
System |
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| (CMTS),
which is required for interactive services like Internet, has been purchased
from ADC |
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| Telecommunications,
USA and is being integrated with the network and other facilities. The |
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| Internet-over-Cable
will be provided by WorldCALL Dot Corn (Pvt) Ltd. which is a wholly |
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| owned
subsidiary of WML. |
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| The
project was slightly delayed due to the September 11 crisis that affected
worldwide air |
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| travel,
as the vendor was unable to send its staff to commission the CMTS equipment
required |
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| for
the Internet-over-Cable. However, work has resumed and the Internet service
will be |
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| launched
on December 15. We expect outside cable plant to be complete by June 2002. |
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| Future Outlook |
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| The
outlook for next year is positive. As the company unveils its complete range
of services, |
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| its
strength over rival cable operators will become clearer. The Company will
declare its |
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| commercial
operations on December 1, 2001. |
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|
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| Small
operators are unlikely to keep pace and match the service standards set by
WML. |
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| Already,
there is consolidation within the Cable -IV industry as small operators are
merging |
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| or
giving way to WML. No other company in Lahore offers a service that remotely
resembles |
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| that of WML. |
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|
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| WML
held its IPO on November 7, 2001, and was under-subscribed due to the
uncertain |
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| economic
situation in the country. The underwriters have subscribed to the
unsubscribed |
|
| portion
of the issue and, currently, formalities are being fulfilled so that the
Company may |
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| be
listed on the Karachi and Lahore Stock Exchange in the next month. Financing
required |
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| for
the project is complete and we expect to achieve our project completion
deadline. |
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|
|
|
| Board
of Directors |
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| Since
the last Annual General Meeting held on April 10, 2001, Mr. Muhammad Shuaib |
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| Yousuf,
Mr. Sadiq Yousuf Yalmaz and Mr. Muhammad Yaqoob resigned and Mr. Fazeel Asif |
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| Jah,
Mr. Nasir Iqbal and Mr. Lane P Pendleton were appointed on the Board of
Directors |
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| respectively.
Currently the Board consists of seven Directors. |
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| Auditors |
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| The
present auditors Messrs Ford, Rhodes, Robson, Morrow, Chartered Accountants
shall |
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| retire
and may be considered for re-appointment for the year 2001-2002 |
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| Pattern
of Shareholding |
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| The
pattern of shareholding is annexed to this report. |
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| Human
Resources |
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| The
directors acknowledge and appreciate the sincere and dedicated efforts put in
by |
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| each
member of your company without which the company could not have achieved |
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| such
results in such a short time. |
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| Lahore |
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|
Humayun Khan Bangash |
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| November
29, 2001 |
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|
Chief Executive |
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| AUDITORS'
REPORT |
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| We
have audited the annexed balance sheet of WorldCALL
Multimedia Limited as at June |
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| 30,
2001 and the related cash flow statement and statement of
changes in equity together |
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| with
the notes forming part thereof, for the year then ended (there being no
profit and loss |
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| account
for the reason stated in Note 1 to the accounts) and we state that we have |
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| obtained
all the information and explanations which, to the best of our knowledge and |
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| belief,
were necessary for the purposes of our audit. |
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| It
is the responsibility of the company's management to establish and maintain a
system |
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| of
internal control, and prepare and present the above said statements in
conformity with |
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| the
approved accounting standards and the requirements of the Companies
Ordinance, |
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| 1984.
Our responsibility is to express an opinion on these statements based on our
audit. |
|
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| We
conducted our audit in accordance with the auditing standards as applicable
in |
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| 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. |
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| An
audit includes examining on a test basis, evidence supporting the amounts and
disclosures |
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| 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 |
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| of
the above said statements. We believe that our audit provides a reasonable
basis for |
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| our
opinion and, after due verification, we report that:- |
|
|
| (a)
in our opinion, proper books of accounts have been kept by the company |
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| as
required by the Companies Ordinance, 1984; |
|
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| (b) in our opinion:- |
|
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| i)
the balance sheet together with the notes thereon have been drawn |
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| up
in conformity with the Companies Ordinance, 1984, and are in |
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| agreement
with the books of accounts and are further in accordance |
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| with
accounting policies consistently applied; |
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|
|
|
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| ii)
the expenditure incurred during the year was for the purpose of the |
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| company's
business; and |
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|
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|
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| iii)
the business conducted, investments made and the expenditure |
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| incurred
during the year were in accordance with the objects of the |
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| company; |
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|
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| (c)
in our opinion and to the best of our information and according to the |
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| explanations
given to us, the balance sheet and the cash flow statement, |
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| together
with the notes forming part thereof, conform with approved |
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| accounting
standards as applicable in Pakistan, and, give the information |
|
| required
by the Companies Ordinance, 1984, in the manner so required and |
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| respectively
give a true and fair view of the state of the company's affairs |
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| as
at June 30, 2001 and its cash flows and changes in equity for the year |
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| then ended; and |
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| (d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr |
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| Ordinance, 1980. |
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| LAHORE |
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|
Ford, Rhodes, Robson, Morrow |
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| November
29,2001 |
|
Chartered Accountants |
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|
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| BALANCE
SHEET AS AT JUNE 30, 2001 |
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|
|
Note |
2001 |
2000 |
|
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|
|
Rupees |
Rupees |
|
|
|
| TANGIBLE
FIXED ASSETS |
|
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|
| Operating
fixed assets |
|
3 |
34,689,316 |
-- |
|
| Capital work-in-progress |
|
4 |
286,138,455 |
61,510,000 |
|
|
|
------------------ |
------------------ |
|
|
|
320,827,771 |
16,510,000 |
|
|
|
|
|
| LONG TERM INVESTMENTS |
|
5 |
49,980,000 |
-- |
|
| DEFERRED COST |
|
6 |
3,056,943 |
35,000 |
|
| LONG TERM DEPOSITS |
|
7 |
7,499,829 |
750,000 |
|
|
|
|
|
| CURRENT
ASSETS |
|
| Stores
and spares |
|
|
22,552,697 |
-- |
|
| Advances, prepayments
and other receivables |
8 |
37,974,442 |
-- |
|
| Cash and bank balances |
|
9 |
38,580,787 |
-- |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
99,107,926 |
-- |
|
| CURRENT
LIABILITIES |
|
|
|
| Short term running finance-
Secured |
10 |
47,850,228 |
-- |
|
| Current
maturity of liabilities against assets |
|
|
| subject to finance lease |
|
12 |
15,307,073 |
3,616,930 |
|
| Creditors, accrued and
other liabilities |
11 |
27,758,958 |
2,760,955 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
90,916,259 |
6,377,885 |
|
|
------------------ |
------------------ |
|
|
|
|
8,191,667 |
(6,377,885) |
|
| WORKING CAPITAL |
|
|
|
|
|
| Liabilities
against assets subject to finance lease |
12 |
32,866,715 |
10,882,115 |
|
| Deferred liabilities-
Gratuity |
|
13 |
605,000 |
-- |
|
|
|
------------------ |
------------------ |
|
| NET
CAPITAL EMPLOYED |
|
|
356,084,495 |
35,000 |
|
|
|
========== |
========== |
|
|
|
| REPRESENTED
BY: |
|
| Share
capital |
|
14 |
185,035,000 |
35,000 |
|
| Advance against issue of
shares |
|
171,049,495 |
-- |
|
| Contingencies and
commitments |
15 |
-- |
-- |
|
|
|
------------------ |
------------------ |
|
|
|
356,084,495 |
35,000 |
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
| Lahore |
Chief Executive |
|
Director |
|
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
|
|
2001 |
2000 |
|
|
|
|
Rupees |
Rupees |
|
|
| Cash
flow from operating activities: |
|
| (Increase)
/ decrease in current assets |
|
| Stores
and spares |
|
|
(22,552,697) |
-- |
|
| Advances,
prepayments and other receivables |
|
(37,974,442) |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(60,527,139) |
-- |
|
|
| Increase / (decrease)
in current liabilities |
|
| Creditors
accrued and other liabilities |
|
24,998,003 |
2,760,955 |
|
|
|
------------------ |
------------------ |
|
| Net
cash flow from operating activities |
|
(35,529,136) |
2,760,955 |
|
|
|
|
|
| Cash
flow from investing activities: |
|
| Purchase
of fixed assets |
|
(40,067,293) |
-- |
|
| Capital
work in progress |
|
(264,250,478) |
16,510,000) |
|
| Long
term investments |
|
(49,980,000) |
-- |
|
| Deferred cost |
|
(3,021,943) |
(35,000) |
|
|
|
------------------ |
------------------ |
|
| Net
cash flow from investing activities |
|
(357,319,714) |
16,545,000) |
|
|
|
|
|
|
| Cash
flow from financing activities: |
|
| Share
capital issued |
|
185,000,000 |
35,000 |
|
| Advance
against issue of shares |
|
171,049,495 |
-- |
|
| Deferred
liability- Gratuity (Net) |
|
605,000 |
-- |
|
| Long
term deposits |
|
(6,749,829) |
(750,000) |
|
| Liabilities
against assets subject to finance lease |
|
33,674,743 |
14,499,045 |
|
| Short
term running finance |
|
47,850,228 |
-- |
|
|
|
------------------ |
------------------ |
|
| Net
cash flow from financing activities |
|
431,429,637 |
13,784,045 |
|
|
------------------ |
------------------ |
|
| Net
Increase In cash and cash equivalents |
|
38,580,787 |
-- |
|
|
|
|
|
| Cash
and cash equivalents at the beginning of the year |
-- |
-- |
|
|
|
|
------------------ |
------------------ |
|
| Cash
and cash equivalents at the end of the year |
|
38,580,787 |
-- |
|
|
========== |
========== |
|
|
| Lahore |
|
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN EQUITY |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
|
Share |
Advance against |
Total |
|
|
Capital |
issue of shares |
|
|
|
|
Rupees |
Rupees |
Rupees |
|
|
|
| Balance
as at June 09, 2000 |
|
-- |
-- |
-- |
|
| Issuance
of share capital |
|
35,000 |
-- |
35,000 |
|
|
|
------------------ |
------------------ |
------------------ |
|
| Balance
as at June 30, 2000 |
|
35,000 |
-- |
35,000 |
|
| Issuance
of share capital |
|
185,000,000 |
-- |
185,000,000 |
|
| Advance
against issue of shares |
|
-- |
171,049,495 |
171,049,495 |
|
|
|
------------------ |
------------------ |
------------------ |
|
| Balance
as at June 30, 2001 |
|
185,035,000 |
171,049,495 |
356,084,495 |
|
|
========== |
========== |
========== |
|
|
| Lahore |
|
Chief Executive |
|
Director |
|
|
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED JUNE 30, 2001 |
|
|
| 1.
THE COMPANY AND ITS OPERATIONS |
|
| WorldCALL
Multimedia Limited was incorporated on June 09, 2000 as a public limited
company |
|
| under
the Companies Ordinance, 1984.The principle activity of the Company is to
re-broadcast |
|
| international/national
satellite/terrestrial wireless and cable television and radio signals as well |
|
| as
interactive communication. The Company has been licensed by Pakistan |
|
| Telecommunication
Authority for this purpose. |
|
|
|
|
| The
Company has not started its commercial operations hence no profit and loss
account is |
|
| prepared
for the year ended June 30, 2001. |
|
|
