| Data Agro 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 Meeting |
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| Directors'
Report |
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| Auditors'
Report |
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| Balance Sheet |
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| Profit
& Loss Account |
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| Cash
Flow Statement |
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| Notes
to the Accounts |
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| Pattern
of Share Holding |
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| COMPANY
INFORMATION |
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| Chief
Executive: |
Mr. Faaiz Rahim Khan |
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| Directors: |
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Mr. Muhammad Farooq
Naseem |
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Mr. Umar Sadik |
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Mr. Furqan Ellahi |
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|
M. Ayub Khan |
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Mr. Asif Rahim Khan |
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Mrs. Badar Hussain |
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| Company
Secretary: |
Mr. Muhammad Azam |
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| Auditors: |
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M/s Mansha Mohsin Dossani
Khan & Co. |
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|
Chartered Accountants |
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3rd. Floor Sharjah
Centre, |
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62-Shadman Market Lahore. |
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| Bankers: |
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AI-Baraka Islamic |
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|
Bank B.S.C. (E.C.) |
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|
Habib Bank Limited |
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|
Allied Bank of Pakistan
Limited |
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The Bank of Punjab |
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|
Muslim Commercial Bank
Ltd. |
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|
Gulf Commercial Bank Ltd. |
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| Legal Advisor: |
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Muhammad Naseem & Co. |
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|
Ashtar Ausaf Ali |
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| Registered
Office: |
3 - A, Race View, Jail
Road, |
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Lahore. |
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| Factory: |
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Khanewal-Kabirwala Road, |
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District Khanewal. |
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| NOTICE
OF ANNUAL GENERAL MEETING |
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| Notice
is hereby given that the 7th Annual General Meeting of Shareholders of Data
Agro Limited will |
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| be
held on Thursday December 30, 1999 at 2.00 P.M. at the Registered Office of
the Company, 3-A, |
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| Race
View, Jail Road, Lahore to transact the following business: |
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| 1.
To confirm the minutes of 6th Annual General Meeting held on December 31,
1998. |
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|
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| 2.
To receive and adopt the Audited Accounts of the Company alongwith Directors
and |
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| Auditors
reports thereon, for the year ended June 30, 1999. |
|
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| 3.
To elect Directors in accordance with the provisions of Section 178 of the
Companies |
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| Ordinance,
1984. The Directors have fixed the number of elected Directors at SEVEN. The |
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| Names
of the retiring Directors are as under: |
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|
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| a)
Mr. Faaiz Rahim Khan |
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| b)
Mr. Muhammad Farooq Naseem |
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| c)
Mr. Asif Rahim Khan |
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| d)
Mr. Umar Sadik |
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| e)
Mr. Furqan Ellahi |
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| f)
Mrs. Badar Hussain |
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| g)
Mr. M. Ayub Khan |
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| 4.
To appoint Auditors of the company for the year ended June 30, 2000 and to
fix their |
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| remuneration.
The retiring Auditors M/s Mansha Mohsin Dossani Khan & Company |
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| (Chartered
Accountants), being eligible have offered themselves for reappointment. |
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| 5.
Any other business with the permission of the chair. |
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| The
Share Transfer Books of the Company will remain close from December 30, 1999
to January 5, |
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| 2000
(both days inclusive). |
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|
BY ORDER OF THE BOARD |
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| Lahore |
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(MUHAMMAD AZAM) |
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| December
07, 1999. |
|
Company Secretary |
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| NOTES: |
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| (a)
A member entitled to attend and vote at the above meeting may appoint another
as proxy. |
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| Proxies
in order to be effective must be received at the Registered Office of the
Company not |
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| later
than forty eight hours before the time of meeting must be duly stamped,
signed and |
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| witnessed. |
|
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| (b)
Members are requested to notify the Company of any change in their address. |
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| (c)
Nomination from the member for the office of Director must be received at
least 14 clear days |
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| before
the time of the meeting at the registered office of the Company during
working hours. |
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|
| DIRECTOR'S
REPORT |
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| The
Directors of your company are pleased to present the 7th annual report
alongwith the audited |
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| accounts
for the year ended June 30th, 1999. |
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| Performance
Review: |
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| The
year under review did not augur well for the company. Your Company has
suffered a Loss of Rs. |
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| 24.531
million (1998: Net Profit of Rs. 6.576 million). Due to the efforts of the
management total sales |
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| increased
considerably but were offset by two major problems: |
|
|
| i)
The basic purchase price remained high beyound expectations and sale price
did not rise as was |
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| earlier
predicated. This made the cost of goods sold figure increase significantly. |
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|
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| (ii)
Our biggest problem in the year was the writing off the stock held from the
previous year. It was valued |
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| at
Rs. 11.1 million. Our germination testing showed that the stocks' percentage
of seed germination |
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| had
fallen below acceptable levels. We could not compromise on the quality of our
product and |
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| therefore
wrote this stock off. |
|
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| Although
the company registered a huge loss we did make progress in our
diversification policy. We |
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| continued
to change our focus from only cotton to other crops like wheat and canola.
Another positive |
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| aspect
has been controlling the total debt and ensuring that the debt did not get to
unmanageable |
|
| proportions. |
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| Auditor's
Report: |
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| The
auditors in their report have drawn attention to the factors that raises
doubt regarding company's |
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| ability
to continue as a going concern. The board of directors would like to point
out very strongly the |
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| commitment
it has to keep our company not only a going concern but to make it very
profitable in the near |
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| future
with low debt and prudent increase in sales. |
|
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| Keeping
this in view the management has raised additional capital of Rs. 26 million.
This capital has |
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| been
inducted into the company, post balance sheet date. This money has been
utilized in retirement of |
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| debt
which is already having a positive impact. |
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| We
are confident that the future for Data Agro Limited is bright as we have
brought debt to controllable |
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| levels
and diversification in sales will be the continuing focus of our operations. |
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|
| Millennium
Bug: |
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| Computer
problem relating to year 2000 called as "Millennium Bug" is a major
issue being faced by most |
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| organizations
all over the world. In order to get this problem resolved, your company have
hired services |
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| of
Software Engineers & Software Consultants and are pleased to inform you
that all work in this regard |
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| has
already been completed. |
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| Auditors: |
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| The
present auditors Messrs. Mansha Mohsin Dossani Khan & Company, Chartered
Accountants, retire |
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| and
being eligible, offer themselves for reappointment. |
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| Pattern
of Shareholding: |
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| A
statement showing pattern of shareholdings in the company is attached. |
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| Acknowledgement: |
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| We
would like to thank our customers and our bankers for their valued support.
The employees of Data |
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| Agro
deserve a special mention for their devoted, diligent and persistent
conviction to their company. I |
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| feel
proud to be leader of a team which has shown uncompromising resilience in
such difficult times of our |
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| company's
history. |
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| Lahore |
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|
(FAAIZ RAHIM KHAN) |
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| November
30, 1999. |
|
Chief Executive |
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|
|
| AUDITORS'
REPORT TO THE MEMBERS |
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| We
have audited the annexed balance sheet of Data Agro Limited as at June 30, |
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| 1999
and the related profit and loss account and cash flow statement, together
with |
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| the
notes forming part thereof, for the year then ended and we state that we have |
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| obtained
all the information and explanations which to the best of our knowledge |
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| and
belief were necessary for the purpose of our audit and, after due
verification |
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| thereof,
We report that; |
|
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| a)
in our opinion, proper books of account have been kept by the company as |
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| required
by the Companies Ordinance, 1984. |
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|
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| b)
in our opinion: |
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|
|
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| (i)
The balance sheet and profit and loss account together with notes |
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| thereon
have been drawn up in conformity with the Companies |
|
|
| Ordinance,
1984, and are in agreement with the books of account and |
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| are
further in accordance with accounting policies consistently applied; |
|
|
| (ii)
The expenditure incurred during the year was for the purpose of |
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| Company's
business; and |
|
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| (iii)
The business conducted, investment 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: |
|
|
| 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 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 |
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| company's
affairs as at June 30, 1999 and of the loss and the cash flows for |
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| the
year then ended; and |
|
|
| 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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|
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| With
out qualifying our opinion we draw attention to note 2.1 to the accounts
which |
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| states
factors that raise doubt. regarding the Company's ability to continue as a |
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| "Going
Concern". |
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|
| Place: Lahore |
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|
(MANSHA MOHSSIN DOSANI KHAN & CO.) |
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| Dated
November 29, 1999. |
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|
Chartered Accountants |
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| BALANCE
SHEET AS AT JUNE 30, 1999 |
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| CAPITAL
& LIABILITIES |
|
Note |
1999 |
1998 |
|
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|
|
(Rs.) |
(Rs.) |
|
| SHARE
CAPITAL & RESERVES |
|
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| Authorised
capital |
|
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| 5,000,000
ordinary shares of Rs. 10 each |
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|
50,000,000 |
50,000,000 |
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|
========== |
========== |
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| Issued,
subscribed and paid up capital |
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| 4,000,000
ordinary shares of Rs. 10 each fully |
|
|
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| paid
in cash |
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|
40,000,000 |
40,000,000 |
|
|
|
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|
| Accumulated
profit/(loss) |
|
|
(59,472,615) |
(34,941,541) |
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|
------------------ |
------------------ |
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|
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|
(19,472,615) |
5,058,459 |
|
|
|
|
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|
| SURPLUS
ON REVALUATION |
|
4 |
32,959,224 |
32,959,224 |
|
| OF
FIXED ASSETS |
|
|
|
|
|
|
|
|
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| REDEEMABLE
CAPITAL |
|
5 |
30,167,254 |
49,310,738 |
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|
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| LIABILITIES
AGAINST ASSETS |
|
|
|
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| SUBJECT
TO FINANCE LEASE |
|
6 |
3,420,356 |
-- |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Short
term running finance |
|
|
4,382,042 |
3,452,330 |
|
| Current
portion of redeemable capital |
|
7 |
27,030,906 |
5,342,661 |
|
| Current
portion of liability against asset |
|
|
|
|
| Subject
to finance lease |
|
|
1,899,644 |
-- |
|
| Advances
and deposits |
|
8 |
3,403,319 |
211,653 |
|
| Creditors,
accrued and other liabilities |
|
|
4,865,639 |
4,883,875 |
|
| Provision
for Taxation |
|
9 |
50,089 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
41,631,639 |
13,890,519 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
10 |
-- |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
88,705,858 |
101,218,940 |
|
|
|
|
|
========== |
========== |
|
|
| FIXED
CAPITAL EXPENDITURES |
|
|
|
|
|
| Operating
fixed assets - tangible |
|
11 |
72,879,173 |
79,456,725 |
|
|
| Assets
subject to finance lease |
|
12 |
6,135,200 |
337,264 |
|
|
|
|
|
|
|
|
| DEFERRED
COSTS |
|
13 |
-- |
291,832 |
|
|
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
|
|
| Stores,
spares and loose tools |
|
14 |
1,600,500 |
1,207,447 |
|
|
| Stock in trade |
|
15 |
2,084,418 |
11,772,483 |
|
|
| Trade debtors |
|
16 |
4,150,953 |
5,770,210 |
|
|
| Advances,
deposits, prepayments |
|
|
-- |
2,162,529 |
|
|
| and
other receivables |
|
17 |
1,544,081 |
-- |
|
|
| Cash
and bank balances |
|
18 |
311,533 |
220,450 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
9,691,485 |
21,133,119 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
|
88,705,858 |
101,218,940 |
|
|
|
|
|
========== |
========== |
|
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| The
annexed notes form an integral part of these accounts. |
|
|
|
|
(FAAIZ RAHIM KHAN) |
|
(M. FAROOQ NASEEM) |
|
|
|
Chief Executive |
|
Director |
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|
|
|
| PROFIT
& LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
Note |
1999 |
1998 |
|
|
|
(Rs.) |
(Rs.) |
|
|
|
|
| SALES |
|
19 |
30,053,426 |
25,635,194 |
|
| COST
OF SALES |
|
20 |
40,392,134 |
18,493,782 |
|
|
|
|
------------------ |
------------------ |
|
| Gross
profit / (loss) |
|
|
(10,338,708) |
7,141,412 |
|
|
|
|
| OPERATING
EXPENSES |
|
|
|
| Administrative |
|
21 |
3,553,567 |
2,102,475 |
|
| Selling
& distribution |
|
22 |
2,547,069 |
2,056,325 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
6,100,636 |
4,158,800 |
|
|
|
|
------------------ |
------------------ |
|
| Operating
Profit / (loss) |
|
|
(16,439,344) |
2,982,612 |
|
| Financial
and other charges |
|
23 |
9,089,283 |
8,372,389 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(25,528,627) |
(5,389,777) |
|
| Other income |
|
24 |
1,047,642 |
331,070 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
/ (Loss) before unusual Items |
|
|
(24,480,985) |
(5,058,707) |
|
|
|
|
|
|
| Unusual items |
|
25 |
-- |
11,634,334 |
|
|
|
|
------------------ |
------------------ |
|
| Profit
/ (loss) for the year before Taxation |
|
(24,480,985) |
6,575,627 |
|
|
|
|
|
|
|
| Taxation |
|
|
|
|
(50,089) |
-- |
|
|
|
|
|
|
------------------ |
------------------ |
|
| Profit
/ (loss) after Taxation |
|
|
|
(24,531,074) |
6,575,627 |
|
|
|
|
| Unappropriated
Profit / (loss) brought forward |
|
|
(34,941,541) |
(41,517,168) |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
Profit / (loss) carried forward |
|
|
(59,472,615) |
(34,941,541) |
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
(FAAIZ RAHIM KHAN) |
|
|
(M. FAROOQ NASEEM) |
|
|
Chief Executive |
|
|
Director |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
1999 |
1998 |
|
|
|
(Rs.) |
(Rs.) |
|
|
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Profit/(loss)
before tax |
|
(24,480,985) |
6,575,627 |
|
| Adjustment
for |
|
|
|
| Depreciation |
|
8,462,484 |
7,757,981 |
|
| Amortization
of deferred costs |
|
291,832 |
344,837 |
|
| Profit
on disposal of fixed assets |
|
(57,628) |
(114,000) |
|
| Profit
on foreign exchange |
|
(977) |
(950) |
|
| Financial
charges |
|
9,089,283 |
8,019,972 |
|
| Unusual
items (waived off of long term loan) |
|
-- |
(11,634,334) |
|
| Workers'
profit participation fund |
|
-- |
347,417 |
|
| Operating
Profit before working capital changes |
|
(6,695,991) |
11,296,550 |
|
|
|
|
|
|
|
| (Increase)
/ decrease in current assets |
|
|
| Stores,
spares and loose tools |
|
(393,053) |
117,867 |
|
| Stock in trade |
|
9,688,065 |
856,100 |
|
| Trade debtors |
|
1,619,257 |
20,753,258 |
|
|
|
------------------ |
------------------ |
|
| Advances,
deposits, prepayments and other receivables |
|
630,738 |
(567,454) |
|
|
|
|
|
------------------ |
------------------ |
|
| Increase/(decrease)
in current liabilities |
|
11,545,007 |
21,159,771 |
|
|
|
------------------ |
------------------ |
|
| Advances
from customers |
|
3,191,666 |
182,134 |
|
| Creditors,
accured and other liabilities |
|
1,327,589 |
(324,450) |
|
|
|
------------------ |
------------------ |
|
|
|
4,519,255 |
(142,316) |
|
|
|
------------------ |
------------------ |
|
| Cash
generated from / (utilized in) operation |
|
9,368,271 |
32,314,005 |
|
| Financial
charges paid |
|
(4,668,382) |
(8,441,450) |
|
| Profit
on foreign exchange |
|
977 |
950 |
|
| Income
Tax paid |
|
(12,290) |
(8,640) |
|
|
|
------------------ |
------------------ |
|
| Net
cash used in operating activities |
|
4,688,576 |
23,864,865 |
|
|
|
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Purchase
of fixed assets |
|
(162,740) |
(44,360) |
|
| Capital
work in progress |
|
-- |
(10,155,125) |
|
| Sale
proceed of fixed assets |
|
137,500 |
240,000 |
|
|
|
------------------ |
------------------ |
|
| Net
cash from / (used in) investing activities |
|
(25,240) |
(9,959,485) |
|
|
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Repayment
of redeemable capital |
|
(3,221,965) |
(2,292,830) |
|
| Repayment
of finance lease liability |
|
(2,280,000) |
(347,850) |
|
| Repayment
of shod-term running finance |
|
(780,000) |
(12,033,450) |
|
|
|
------------------ |
------------------ |
|
| Net
cash from / (used in) financing activities |
|
(6,281,965) |
(14,674,130) |
|
|
|
------------------ |
------------------ |
|
| Net
Increase / (Decrease) In Cash And Cash Equivalent |
|
(1,618,629) |
(768,750) |
|
|
|
------------------ |
------------------ |
|
| Cash
and Cash Equivalent at the Beginning of the Period |
|
(751,880) |
16,870 |
|
|
|
|
========== |
========== |
|
|
|
|
|
| Cash
and Cash Equivalent at the end of the Period # |
|
(2,370,509) |
(751,880) |
|
| # Cash in hand |
|
36,771 |
84,507 |
|
| Cash at Bank:- |
|
|
|
|
|
|
| Current
/ Foreign Accounts: |
|
|
|
| Debit |
|
274,762 |
135,943 |
|
| Credit |
|
(2,682,042) |
(972,330) |
|
|
|
------------------ |
------------------ |
|
|
|
(2,407,280) |
(836,387) |
|
|
|
------------------ |
------------------ |
|
|
|
(2,370,509) |
(751,880) |
|
|
|
|
========== |
========== |
|
|
|
(FAAIZ RAHIM KHAN) |
|
(M. FAROOQ NASEEM) |
|
|
Chief Executive |
|
Director |
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| NOTES
TO THE ACCOUNTS |
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| FOR
THE YEAR ENDED JUNE 30, 1999 |
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| 1.
STATUS AND OPERATION |
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| DATA
AGRO LIMITED was initially incorporated as a private limited company on
November |
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| 10,
1992 and converted into a public limited company on March 06, 1994. The
company is |
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| listed
on Lahore and Karachi stock exchanges. The main activity of the company is |
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| production
and processing of agro seeds. |
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| 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
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| 2.1
The company has recorded a loss of Rs. 24.531 million after taxation,
accumulated losses of |
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| Rs.
59.473 million and reported negative working capital of Rs. 31.940 million
i.e. excess of |
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| current
liabilities over current assets. These factors creates substantial doubts as
to ability of |
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| the
company to continue as a going concern. However, these accounts have been
prepared |
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| on
going concern basis and without any adjustments relating to realization of
company's |
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| assets
and liquidation of its liabilities. The validity of these accounts largely
depends on |
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| management's
future plans, favourable market conditions and continue support from |
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| sponsors
and company bankers in the form of fresh equity injection or short and long
term |
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| financial
assistance at competitive terms, and rescheduling of existing finances. |
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| 2.2
Accounting convention |
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| The
accounts have been prepared under the historical cost convention except to
the extent |
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| that
certain fixed assets have been included at revalued amount. |
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| 2.3
Staff retirement benefits |
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| The
company operates an unfunded gratuity scheme. No provision for gratuity has
been |
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| made
in these accounts as it is accounted for on payment basis. |
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| 2.4
Tangible fixed assets and depreciation |
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| a)
Owned assets |
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| These
are stated at cost or revaluation less accumulated depreciation except land
and |
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| capital
work in progress which are stated at cost or revaluation. |
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| Depreciation
is charged using diminishing balance method whereby the cost or revaluation
of |
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| an
asset is written off over its estimated useful life. |
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| Full
years depreciation is charged in the year of addition while no depreciation
is charged in |
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| the
year of sale. |
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| Minor
renewals or replacements are charged to the income of the year and major
renewals |
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| and
improvements are capitalised. |
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| Gain
or loss on disposal of assets are included in current income. |
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| b)
Assets subject to finance lease |
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| Assets
subject to finance lease are stated at the lower of present value of minimum
lease |
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| payments
at the inception of the lease and their fair value at that date. The
outstanding |
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| obligations
under the lease less financial charges allocated to future periods are
accounted |
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| for
as liabilities. Related financial expenses are charged to the profit and loss
account. |
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| Assets
subject to finance lease are depreciated over the useful life of the assets
on a |
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| reducing
balance method at the rates given in Note 11. Depreciation of leased asset is |
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