| Agriauto Industries Limited |
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| Annual
Report 1999 |
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| CONTENTS |
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| Company
Information |
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| Notice
of Annual General Meeting |
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| Directors' Report |
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| Chairman's
Review |
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| Auditors'
Report to the members |
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| Balance Sheet |
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| Profit
and Loss Account |
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| Statement
of Changes in Financial Position |
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| Notes
to the Accounts |
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| Pattern
of Shareholdings |
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| COMPANY
INFORMATION |
|
|
| BOARD
OF DIRECTORS |
|
|
| R.D. Minwalla |
|
Chairman |
|
| Syed
Ikram Haider |
Chief Executive |
|
| Rais Ahmed |
|
(Nominee ICP) |
|
| Mansoor
G. Habib |
|
| Tayyeb Afzal |
|
| Sohail P. Ahmed |
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| Asfandiyar
R. Minwalla |
|
| Owaisul
Mustafa |
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| COMPANY
SECRETARY |
Fahim Kapadia |
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| AUDITORS |
|
Ford, Rhodes, Robson,
Morrow |
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|
Chartered Accountants |
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| SHARE
REGISTRAR |
Noble Computer Services
(Pvt) Ltd., |
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|
2nd Floor, AI-Manzoor
Building, |
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|
Dr. Ziauddin Ahmed Road, |
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|
Karachi. |
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| REGISTERED
OFFICE |
Agriauto Industries Ltd. |
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|
5th Floor Siddiquesons
Tower, |
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|
Main Shahrah-e-Faisal, |
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Karachi-75350 |
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Pakistan. |
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| FACTORY |
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Mouza Baroot, |
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Hub Chowki, Distt.
Lasbella, |
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Balochistan. |
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| NOTICE
OF MEETING |
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| NOTICE
is hereby given that the eighteenth Annual General Meeting of the Company
will be held |
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| at
Raffia Choudri Memorial Centre, Sidco Avenue Centre, 264 R.A. Lines, Karachi
on Thursday, |
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| December
2, 1999 at 11:00 a.m. |
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| ORDINARY
BUSINESS |
|
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| 1.
To approve the Audited Accounts for the year ended June 30, 1999 alongwith
the Directors' |
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| and
Auditors' Report thereon. |
|
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| 2.
To appoint Auditors for the year 1999 - 2000 and to fix their remuneration.
The retiring |
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| Auditors
M/s Ford, Rhodes, Robson, Morrow (Chartered Accountants) being eligible offer |
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| themselves
for re-appointment. |
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|
| 3.
To elect seven Directors of the Company for a period of three years under
section 178(1) of |
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| the
Companies Ordinance 1984, in place of the retiring Directors namely:- |
|
|
| (i)
Mr. R. D. Minwalla |
|
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| (ii)
Mr. Asfandiyar R. Minwalla |
|
|
| (iii)
Mr. Tayyeb Afzal |
|
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| (iv)
Mr. Mansoor G. Habib |
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| (v)
Mr. Sohail P. Ahmed |
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| (vi)
Mr. Owaisul Mustafa |
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| (vii)
Syed Ikram Haider |
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| (viii)
Mr. Rais Ahmed (Nominee ICP) |
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| SPECIAL
BUSINESS |
|
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| 4.
By way of special business to pass the amendments in the existing Articles of
Agriauto |
|
| Industries
Ltd. and delete redundant and inconsistent provisions. |
|
|
| "RESOLVED
AS PER SPECIAL RESOLUTION that the existing Articles of Agriauto Industries
Ltd. |
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| be
and are hereby amended, in view of certain Articles thereof need to be
deleted as they have |
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| either
become redundant or inconsistent with the provisions of the Companies
Ordinance 1984. For |
|
| that
purpose the attached amendments to set of Articles of Association initialed
by the Director of |
|
| the
Company be and is hereby approved and adopted as the Articles of Association
of the Company, |
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| in
substitution for and to the exclusion of all existing provisions of the
Articles of Association." |
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| RESOLVED
that the Chief Executive and or the Company Secretary be and is hereby
authorized to |
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| take
all such steps as may be necessary or incidental for the purpose. |
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| Statement
under section 160(1)(b) of the Companies Ordinance 1984 pertaining to the
special |
|
| business
is being sent to the members with this notice. |
|
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| 5.
To consider any other business with the permission of the chair. |
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|
By order of the Board. |
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|
FAHIM KAPADIA |
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| Karachi:
November 8, 1999 |
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Company Secretary |
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| NOTES: |
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| 1.
The Share transfer books of the company will remain closed from November 25,
1999 to |
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| December
2, 1999. (Both days inclusive) |
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| 2.
A member entitled to attend and vote at this meeting may appoint another
member as |
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| his/her
proxy to attend the meeting and vote for him/her. Proxies in order to be
effective |
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| must
be received at the registered office of the company duly stamped and signed
not less |
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| than
48 hours before the time of holding the meeting. |
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|
| 3.
Members are requested to promptly communicate any change in their addresses
to |
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| Company's
Share Registrar, M/s. Noble Computer Services (Pvt.) Ltd. 1st Floor,
Al-Manzoor |
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| Building,
Dr. Ziauddin Ahmed Road, Karachi. Phone: 2635511 (4 Lines) |
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| 4.
The proposed amendments to the Articles of Association of the Company is
being sent to |
|
| the
members along with the notice. |
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| ATTACHMENT
TO THE SPECIAL RESOLUTION |
|
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| SPECIAL
RESOLUTION: |
|
| The
following Articles of Association are being proposed to be deleted,
amended/modified or substituted. |
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| Article - 3 |
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| "Existing
Article - 3 be and is hereby substituted with the following Article." |
|
|
| "COMPANY
TO PURCHASE ITS OWN SHARES - Subject to the provisions of Section 95-A of the |
|
| Ordinance,
company may purchase its own shares". |
|
|
| Article - 39 |
|
| "Existing
Article - 39 be and is hereby substituted with the following Article." |
|
|
| "POWER
TO SUBDIVIDE AND CONSOLIDATE SHARE CAPITAL - The Company, may alter its share |
|
| capital,
in accordance with the provisions of Section 92 of the Companies Ordinance,
1984. |
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|
| Article - 85 |
|
| "Existing
Article - 85 be and is hereby modified." |
|
|
| "NUMBER
OF DIRECTORS - The number of Directors shall not be less than seven nor more
than twelve, |
|
| excluding
Technical Directors (if any) and Directors representing special interest as
mentioned in Section |
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| 195
of the Ordinance". |
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| Article - 88 |
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| "Article
- 88 be and is hereby deleted and other Articles be and are hereby renumbered
accordingly". |
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| Article - 89 |
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| "Article
- 89 be and is hereby deleted and other Articles be and are hereby renumbered
accordingly". |
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| Article - 94 |
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| "Article
- 94(j) & (k) and are hereby deleted." |
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| Article - 102 |
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| "Existing
Article - 102 be and is hereby substituted with the following Article and
hereby renumbered as Article 100." |
|
|
| "POWER
OF DIRECTORS TO FIX THE NUMBER OF DIRECTORS - Subject to the provisions of
Section |
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| 178(1)
of the Companies Ordinance and Article 85, the Company in Board of Directors
Meeting shall fix the |
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| number
of Directors ought to be elected and the number so fixed shall not be changed
except with the prior |
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| approval
in the General Meeting." |
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| Article - 112 |
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| "Article
- 112 be and is hereby deleted and other Articles be and are hereby
renumbered accordingly". |
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| Article - 122 |
|
| "Existing
Article - 122 be and is modified as follows and is hereby renumbered as
Article 119." |
|
| "Directors
shall appoint any person, including an elected Director to be the Chief
Executive of the Company |
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| in
the manner provided in Section 198 and 199 of the Ordinance for a term not
exceeding three years from |
|
| the
date of appointment and may remove a Chief Executive so appointed in the
manner provided in Section |
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| 202
of the Ordinance. The terms and conditions of appointment of the Chief
Executive shall be determined |
|
| by
the Board of Directors. |
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|
| Article - 125 |
|
| "Existing
Article - 125 be and is modified as follows and is hereby renumbered as
Article 122" |
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|
| "REMUNERATION
OF EXECUTIVE DIRECTORS, etc - The remuneration of an Executive Director or |
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| Director
holding any office as is mentioned in Article 120 may from time to time
determined by the Company |
|
| in
board of directors meeting and may be by way of fixed salary, or commission
or dividend, profits or |
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| turnover
of the Company or of any other company in which the Company is interested in
or by participation |
|
| in
any such profits or by any or all of those modes. The remuneration of any
such Director may include such |
|
| provision
(if any) for himself or any dependents (whether by pension, superannuation or
otherwise) after the |
|
| termination
of his office as the Directors shall think proper. A Director holding any
such office as is men- |
|
| tioned
in Article 120 shall not be precluded merely by reason of his office of
Director from membership of |
|
| any
Superannuation or Pension Fund for the time being established or supported by
the Company." |
|
|
| EXPLANATORY
STATEMENT UNDER SECTION 160 (1) (b) OF COMPANIES ORDINANCE, 1984 |
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| This
explanatory statement under section 160 (1) (b) of the Companies Ordinance,
1984 is annexed to the notice of |
|
| the
Annual General Meeting to be held on December 2, 1999 and sets out the
material facts concerning the Special |
|
| Business
to be transacted at the Meeting. |
|
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| By
way of Special Business at the Annual General meeting of the shareholders
approval is required to amend, delete |
|
| or
modify Articles of the existing Articles of Association of the Company as
they have either become irrelevant, |
|
| redundant,
inconsistent with the provisions of the Companies Ordinance, 1984, overlap or
need not to be translated |
|
| with
more structured set of Articles of Associations. |
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|
|
| DIRECTORS
REPORT |
|
|
| 1.
The directors of the Company take pleasure in submitting their report
alongwith the |
|
| audited
accounts of the Company, and Auditors Report thereon, for the year ended June
30, |
|
| 1999 as follows: |
|
|
| Profit
before Taxation |
|
7,741 |
|
| Provision
for Taxation |
|
1,511 |
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|
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|
------------------ |
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| Profit
after Taxation |
|
6,230 |
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| Add:
Accumulated losses brought forward |
|
(29,476) |
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|
|
|
------------------ |
|
| Accumulated
losses carried forward |
|
(23,246) |
|
|
========== |
|
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| 2.
CHAIRMAN'S REVIEW |
|
| The
Chairman's Review is given on Page 6 and 7 deals with the year's activities
and |
|
| Directors
of the Company endorse contents of the same. |
|
|
| 3.
PATTERN OF SHAREHOLDINGS |
|
| The
Pattern of shareholdings is given on page 25 |
|
|
| 4. AUDITORS |
|
| Messers
Ford, Rhodes, Robson, Morrow (Chartered Accountants) retire and being |
|
| eligible,
offer themselves for re-appointment as the auditors of the Company for the
year |
|
| 1999-2000. |
|
|
| 5.
EARNING PER SHARE |
|
| Earning
per share for the year ended June 30, 1999 is Re 0.26. |
|
|
|
|
By order of the Board. |
|
|
|
|
|
|
|
SYED IKRAM HAlDER |
|
| Karachi:
October 26, 1999 |
|
Chief Executive |
|
|
|
|
| CHAIRMAN'S
REVIEW |
|
|
| It
is my great pleasure to welcome you to the 18th Annual General Meeting of
Agriauto |
|
| Industries
Limited and present the report on the performance of the Company for the year |
|
| ended
June 30, 1999 alongwith the Auditors' Report. |
|
|
| 1.
THE ECONOMY AND AUTOMOTIVE ENGINEERING SECTOR |
|
|
| The
industry faced several environmental challenges during the year under review,
which |
|
| included
devaluation of Pak rupees, slowing of macro economic activities, thus
hindering the |
|
| progress
of Engineering Sector. The management is nevertheless optimistic of improved |
|
| results
by further market development, tight control on its overheads, increasing
market share |
|
| through
continuous quality improvement and human resource training and technological |
|
| updating. |
|
|
| Despite
difficult business conditions and adverse economic indicators, the automotive
sector |
|
| showed
slight improvement. The introduction of "Green Tractor Scheme"
boosted agricultural |
|
| Tractor
sales, whilst maintaining the restriction on the import of used cars resulted
in increase |
|
| production
of components for locally assembled passenger cars. |
|
|
| 2.
REVIEW FOR THE YEAR 1998-99 |
|
|
| Through
careful control on expenses coupled with operating efficiency, your company |
|
| achieved
an impressive growth in turnover and profitability. Sales during the year
1998-99 |
|
| were
Rs. 301 million compared to Rs 238 million last year reflecting an increase
of 26%, |
|
| resulting
in a Profit Before Tax of Rs. 7.7 million against Rs 4 million last year,
registering an |
|
| increase of 89%. |
|
|
| 3.
FUTURE OUTLOOK |
|
|
|
| The
company is developing products for assemblers of new cars viz. Suzuki Balano,
Hyundai, |
|
| OKA
and Diahatsu Coure. After getting quality approval of our products we shall
able to utilize |
|
| our
production facilities more efficiently. |
|
|
| The
company is looking to the opportunities for Export in Asian and European
markets with a |
|
| view
of expanding its range and ensuring diversion from the local OEM (Original
Equipment |
|
| Manufacturers). |
|
|
| 4.
ISO CERTIFICATION |
|
|
| The
Company is at its final stages of ISO-9002 certification We are hopeful that
the final audit |
|
| would
be completed by the end of 1999 followed by Certification. The Certification
will |
|
| strengthen
the company in promoting sales of our products within and outside the
country. |
|
|
| 5.
INDUSTRIAL RELATION |
|
|
| The
labor management relations remained cordial. The unionised Staff and
Executives |
|
| extended
full co-operation to the management in its drive for contimions improvement |
|
| programme
of cutting costs and increasing productivity. |
|
|
| 6.
YEAR 2000 COMPLAINT |
|
|
| All
hardware and software of the company are now Year 2000 compliant, Initial
testing has |
|
| been
done and we are confident that there will be no problems in our computer
systems. |
|
|
| 7.
ACKNOWLEDGMENT |
|
|
| On
behalf of the Board of Directors, I would like to place on record our
appreciation to all our |
|
| Patrons,
customers, dealers and suppliers for their valuable help, support and
contribution |
|
| given
to our company. I am also grateful to all our Bankers for their continued
support during |
|
| these
difficult times. We also wish to record our thanks to our overseas Technical |
|
| Collaborators
Messers Maremont Corporation, USA (for Shock Absorbers & Struts) and |
|
| Kayaba
Industry Limited, Japan (for Gas Charged Shock Absorbers and Struts) for
their |
|
| technical
help and advice. |
|
|
| The
Board of Directors also acknowledges the contribution of all the Executives,
staff and |
|
| Workers
who worked together as a team in achieving our Company objective. |
|
|
| Karachi |
|
R. D. MINWALLA |
|
| Dated
October 26th, 1999 |
|
Chairman |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of AGRIAUTO INDUSTRIES LIMITED, as at
June |
|
| 30,
1999 and the related profit and loss account and the statement of changes in
financial |
|
| position
(cash flow statement), 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 and,
after due |
|
| verification
thereof, 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: |
|
|
|
|
| the
balance sheet and profit and loss account together with the notes thereon
have |
|
| been
drawn up in conformity with the Companies Ordinance, 1984 and are in |
|
| agreement
with the books of account and are further in accordance with accounting |
|
| policies
consistently applied; |
|
|
| (ii)
the expenditure incurred during the year was for the purpose of the company's |
|
| business; and |
|
|
| (iii)
the business conducted, investments made and the expenditure incurred during |
|
| the
year were in accordance with the objects of the company; |
|
|
| (c)
in our opinion and to the best of our information and according to the
explanations |
|
| given
to us, the balance sheet, profit and loss account and the statement of
changes in |
|
| financial
position (cash flow statement), together with the notes forming part thereof, |
|
| 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, 1999 and of the profit and the changes in financial position for
the year |
|
| then ended; |
|
|
|
| (d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr
Ordinance, |
|
| 1980; and |
|
|
| (e)
comparative figures in the accounts of the current year were audited by
another firm of |
|
| Chartered
Accountants. |
|
|
| Karachi. |
|
|
Chartered Accountants. |
|
| Dated
October 28, 1999 |
|
Ford. Rhodes, Robson, Morrow |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
Note |
1999 |
1998 |
|
|
|
|
|
(Rs. in
'000') |
|
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
|
|
|
| Authorised
Capital |
|
|
|
| 40,000,000
(1998: 40,000,000) |
|
|
|
|
| Ordinary
shares of Rs. 5 each |
|
|
|
200,000 |
200,000 |
|
|
|
|
========== |
========== |
|
| Issued,
subscribed and paid-up capital |
|
3 |
120,000 |
120,000 |
|
| Capital reserve |
|
4 |
12 598 |
12,598 |
|
| Accumulated
losses |
|
|
(23,246) |
(29,476) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
109,352 |
103,122 |
|
|
|
|
| LONG
TERM LOANS |
|
5 |
32,716 |
20,077 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Current
Portion of Long term loans |
|
5 |
9,391 |
14,522 |
|
| Short
term finances |
|
6 |
35,604 |
35,517 |
|
| Advances
from Others |
|
7 |
35,936 |
21,700 |
|
| Creditors,
Accrued and Other liabilities |
|
8 |
57,702 |
74,937 |
|
| Provision
for taxation |
|
|
2,701 |
1,191 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
141,334 |
147,867 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
9 |
------------------ |
------------------ |
|
|
|
|
283,402 |
271,066 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating assets |
|
10 |
106,479 |
110,025 |
|
| Capital
work-in-progress |
|
11 |
18,716 |
3,642 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
125,195 |
113,667 |
|
|
|
|
|
| LONG
TERM DEPOSITS |
|
|
12 |
1,558 |
2,623 |
|
|
|
|
|
|
| DEFERRED
COST |
|
|
13 |
3,891 |
|
|
|
|
|
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
| Stores
and spares |
|
14 |
9,155 |
8,525 |
|
| Stock-in-trade |
|
|
15 |
67,918 |
82,871 |
|
| Trade debts |
|
|
16 |
40,809 |
30,760 |
|
| Advances,
Deposits Prepayments and Other |
|
|
| receivables |
|
17 |
34,061 |
28,664 |
|
| Cash
and Bank balances |
|
18 |
1,788 |
65 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
153,731 |
150,885 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
283,402 |
271,066 |
|
|
|
|
|
========== |
========== |
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
R.D. MINWALLA |
|
|
SYED IKRAM HAlDER |
|
|
Chairman |
|
Chief Executive |
|
|
| Karachi:
October 26, 1999 |
|
|
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
|
Note |
1999 |
1998 |
|
|
|
|
|
(Rs. in
'000') |
|
|
|
|
| Sales |
|
19 |
300,998 |
237,756 |
|
| Cost
of goods sold |
|
20 |
238,255 |
186,082 |
|
|
|
|
------------------ |
------------------ |
|
| Gross Profit |
|
|
62,743 |
51,674 |
|
|
|
|
| Less: |
Administrative Expenses |
|
21 |
14,830 |
13,744 |
|
|
Selling and Distribution
Expenses |
|
22 |
13,986 |
12,950 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
28,816 |
26,694 |
|
|
|
|
|
------------------ |
------------------ |
|
| Operating
Profit |
|
|
33,927 |
24,980 |
|
|
|
|
|
|
|
| Less: |
Financial charges |
|
23 |
25,962 |
19,744 |
|
|
Other charges |
|
24 |
505 |
285 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
26,467 |
20,029 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
7,460 |
4,951 |
|
| Other income |
|
25 |
281 |
(1,236) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
7,741 |
3,715 |
|
| Write-off
of Mobike Stock |
|
26 |
-- |
(12,318) |
|
| Prior-Period
Adjustment |
|
27 |
-- |
12,705 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
before taxation |
|
7,741 |
4,102 |
|
|
|
|
| Provision
for taxation-current |
|
28 |
15,111 |
1,191 |
|
|
- prior |
|
|
|
-- |
19 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
1,511 |
1,210 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
|
6,230 |
2,892 |
|
| Accumulated
Losses brought forward |
|
|
(29,476) |
(32,368) |
|
|
|
|
------------------ |
------------------ |
|
| Accumulated
Losses carried forward |
|
|
(23,246) |
(29,476) |
|
|
|
|
========== |
========== |
|
| Basic
earnings per share |
|
29 |
0.26 |
0.12 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
R.D. MINWALLA |
|
|
|
SYED IKRAM HAIDER |
|
|
Chairman |
|
|
|
Chief Executive |
|
|
| Karachi:
October 26, 1999 |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
Note |
1999 |
1998 |
|
|
|
|
|
(Rs. in
'000') |
|
