| Indus Jute Mills limited |
|
|
|
|
|
|
|
|
|
|
| Annual
report 1999 |
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|
|
| BOARD
OF DIRECTORS |
|
|
|
| Chief Executive: |
|
MOHAMMED A. JAMAL |
|
|
|
|
| Directors: |
|
SAFDARALI VIRJI WALJI |
|
|
|
ALI RAZA GHULAM ALI |
|
|
|
RAZA HUSSAIN VIRJI WALJI |
|
|
|
MOHAMMED ALI VIRJI WALJI |
|
|
|
FARZANA MUNAF -
Representing NIT |
|
|
|
SARA JAWAID -
Representing NIT |
|
|
| Auditors: |
|
HYDER BHIMJI & CO. |
|
|
|
Chartered Accountants |
|
|
|
| Bankers: |
|
UNITED BANK LIMITED |
|
|
|
NATIONAL BANK OF PAKISTAN
LTD. |
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|
|
BANK AL-HABIB LIMITED |
|
|
|
|
| Registered
Office: |
2nd Floor, Noor Chambers, |
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|
M.A. Jinnah Road, |
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|
Karachi. |
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|
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| Mills: |
|
Dhabeji Industrial Area, |
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|
District Thatta, Sindh. |
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|
|
| NOTICE
OF MEETING |
|
|
| NOTICE
is hereby given that 33rd Annual General Meeting of the Shareholders of the |
|
| Company
will be held at the Registered Office of the Company at 2nd Floor, 53-Noor
Chambers, |
|
| M.A.
Jinnah Road, Karachi on Wednesday, the 29th December, 1999 at 3.00 P.M. to
transact the |
|
| following
business:- |
|
|
| 1.
To confirm minutes of the Extra Ordinary General Meeting held on 26th April,
1999. |
|
|
| 2.
To receive and adopt the Directors' Report and Audited Accounts for the year
ended |
|
| 30th June, 1999. |
|
|
|
| 3.
To approve Dividend as recommended by the Board of Directors. |
|
|
| 4.
To appoint Auditors for the year 1999-2000. |
|
|
| 4.
To transact such other business as may be placed before the meeting with
permission |
|
| of the Chair. |
|
|
|
|
|
By Order of the Board |
|
|
|
ARIF AHMED |
|
| KARACHI:
the 29th November, 1999 |
|
Company Secretary |
|
|
| NOTE: |
|
|
|
| 1.
The Share Transfer Book of the Company will remain closed from 23rd December,
1999 |
|
| to
29th December, 1999 (both days inclusive). |
|
|
| 2.
A member entitled to attend and vote at this Meeting may appoint another
member as |
|
| his
proxy to attend the Meeting. Proxy must be deposited at the Registered Office
of |
|
| the
Company not less than 48 hours before the Meeting. A Proxy must be a member. |
|
|
| 3.
The Shareholders are advised to notify the Company immediately of any change
in their |
|
| addresses
to ensure prompt delivery of mail. |
|
|
|
| DIRECTORS'
REPORT TO THE SHAREHOLDERS |
|
|
| Your
directors are pleased to place before you their 33rd annual report together
with |
|
| audited
accounts of your company for the year ended 30th June, 1999. |
|
|
| The
financial results for the year under report are as under:- |
|
|
| NET
PROFIT BEFORE THE FOLLOWING: |
|
Rs. 48,182,090 |
|
|
| Deduct: |
Depreciation |
|
|
Rs. 12,550,106 |
|
|
Workers' participation
fund |
|
Rs. 1,728,804 |
|
|
Worker's welfare fund |
|
Rs. 490,765 |
|
|
Provision for taxation |
|
Rs. 24,000,000 |
|
|
Prior period items |
|
Rs. 140,613 |
Rs. (38,910,288) |
|
|
|
|
------------------ |
------------------ |
|
|
NET PROFIT FOR THE YEAR |
|
|
Rs. 8,271,802 |
|
| Add: |
Unappropriated profit
brought forward |
|
Rs. 1,255,014 |
|
|
|
------------------ |
|
|
BALANCE AVAILABLE FOR
APPROPRIATION |
|
Rs. 10,526,816 |
|
|
|
|
|
========== |
|
|
|
|
|
|
|
| Your
directors propose to appropriate above balance as under:- |
|
|
|
|
|
|
| Transfer
to general reserve |
|
|
Rs. 2,000,000 |
|
| Proposed
dividend @ 271/2% |
|
|
Rs. 7,728,058 |
|
| Unappropriated
profit to be carried forward |
|
Rs. 798,758 |
|
|
|
|
------------------ |
|
|
|
Total:- |
Rs. 10,526,816 |
|
|
|
|
========== |
|
|
| The
earning per share after tax works out to Rs.3.30 as against Rs.6.99 for the
last year. |
|
|
| WORKING
RESULTS |
|
|
| Working
results of your company for the financial year under review suffered major
set- |
|
| back
on account of lower demand for the Jute bags as wheat imports were slashed
down by |
|
| approximately
one million tons and although the procurement agencies were able to fulfill
their |
|
| respective
targets but this was done by t-hem at the cost of new jute bags as more
recycled |
|
| bags
were used by these agencies in view of the financial crunch faced by them. As
a result |
|
| of
this, sales of your company declined by over 20% and resultant higher
inventory level escalated |
|
| financial
cost by well over 100%. |
|
|
| Due to combined effect of the above factors
and marginal increase in the manufacturing |
|
| cost,
pre-tax profit plunged to Rs. 33.013 million from Rs. 61.376 million for the
preceding year. |
|
|
| SALES
TURNOVER |
|
|
| Sales
turnover for the year under review stood at Rs. 414.324 million as against
Rs.5 21.721 |
|
| million
for the last year. Shrinkage of over 20% in sales revenue was attributable to
lower demand |
|
| of
jute bags by all major procurement agencies. The gap in sales revenue would
have been |
|
| wider,
had adverse impact of fall in demand from the government sector was not
partially offset |
|
| through
(a) sales to the wheat importers in the private sector and (b) enhancing
company's |
|
| share
in the local hessian market by boosting hessian production by over 50%. |
|
|
| FUTURE
PROSPECTS |
|
|
| On
account of lack of orders for jute bags during the period July-October 1999,
liquidity |
|
| position
of the company has deteriorated. The lack of demand is attributable to (a)
delay in |
|
| finalizing
wheat import contracts by the Ministry of Food and (b) continued ban on
import of |
|
| wheat
by the private sector imposed by the Government. However, since end of
October, 1999 |
|
| Director
General Food have commenced taking deliveries of the bags which has brought
some |
|
| relief. |
|
|
| It
may, however, be noted that the country needs to import around 3 million tons
of wheat |
|
| which
would generate demand for 90,000 bales of jute bags but due to delayed wheat
imports, |
|
| procurements
are likely to be staggered until March/April, 2000. The slow pace of off-take
will |
|
| unnecessarily
lock-up funds in stocks and increase financial cost. |
|
|
| In
view of the above scenario and expected lower demand for remaining period of
the |
|
| year,
prospects for the current financial year do not seem promising and further
set back of |
|
| the
operational and financial results can not be ruled out. |
|
|
| DIRECTORS |
|
|
|
| On
26-04-1999 Ms. Farzana Munaf and Ms. Sara Jawaid were elected on the
Company's |
|
| Board
as nominee Directors of NIT in place of outgoing nominee Directors M/s.
Mohammed |
|
| Afzal-Ullah
Siddiqui (NIT) and Mirza Khurshid Baig (ICP). The Board, while placing on
record |
|
| it's
appreciation for the valuable contributions made by M/s. Mohammed Afzal-Ullah
Siddiqui |
|
| and
Mirza Khurshid Baig during their tenure on the Board, welcomes Ms. Farzana
Munaf and |
|
| Ms.
Sara Jawaid on the Board. |
|
|
| Y2K
COMPLIANCE |
|
|
|
| Financial
accounts and other computerised control systems of the company are Y2K |
|
| Compliant. |
|
|
| PATTERN
OF SHAREHOLDINGS |
|
|
|
| The
pattern of shareholdings as at June, 1999 is attached to this report. |
|
|
| AUDITORS |
|
|
|
| The
present auditors of the Company M/s. Hyder Bhimji & Company, Chartered
Accountants, |
|
| retire
and being eligible, offer themselves for re-appointment for the financial
year 1999-2000. |
|
|
| The
Directors wish to place on record their appreciation for the enthusiasm,
loyalty and |
|
| devotion
to duty displayed by the workers, staff and executives of the company. |
|
|
|
|
On behalf of the Board |
|
|
|
|
|
|
|
|
|
MOHAMMED A. JAMAL |
|
| KARACHI:
the 29th November, 1999 |
|
Chief Executive |
|
|
|
| PATTERN
OF HOLDING OF SHARES HELD BY SHAREHOLDERS |
|
| AS
AT 30TH JUNE, 1999 |
|
|
| FORM- A |
|
|
| No. of |
|
Shareholdings |
|
Total |
|
| Shareholders |
|
Shares Held |
|
|
| 35 |
1 |
TO |
100 |
1,281 |
|
| 76 |
101 |
TO |
500 |
15,762 |
|
| 24 |
501 |
TO |
1,000 |
17,048 |
|
| 76 |
1,001 |
TO |
5,000 |
218,229 |
|
| 69 |
5,001 |
TO |
10,000 |
531,750 |
|
| 24 |
10,001 |
TO |
15,000 |
283,018 |
|
| 14 |
15,001 |
TO |
20,000 |
245,922 |
|
| 6 |
20,001 |
TO |
25,000 |
129,427 |
|
| 3 |
25,001 |
TO |
30,000 |
83,774 |
|
| 1 |
30,001 |
TO |
35,000 |
30,743 |
|
| 1 |
35,001 |
TO |
40,000 |
39,193 |
|
| 2 |
50,001 |
TO |
55,000 |
106,276 |
|
| 1 |
54,001 |
TO |
545,000 |
541,466 |
|
| 1 |
565,001 |
TO |
570,000 |
566,314 |
|
| ------------------ |
|
------------------ |
|
| 333 |
|
2,810,203 |
|
| ========== |
|
========== |
|
|
| Categories
of Shareholders |
|
Number |
Shares Held |
Percentage |
|
|
| Individuals |
|
327 |
2,174,263 |
77.37 |
|
| Investment
Companies |
|
2 |
567,436 |
20.19 |
|
| Insurance
Companies |
|
3 |
52,334 |
1.86 |
|
| Financial
Institution |
|
1 |
16,170 |
0.58 |
|
|
|
------------------ |
------------------ |
------------------ |
|
| TOTAL |
|
333 |
2,810,203 |
100.00 |
|
|
========== |
========== |
========== |
|
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed Balance Sheet of INDUS JUTE MILLS LIMITED, as at
June |
|
| 30,
1999 and the related Profit and Loss Account and Statement of Changes in
Financial Position |
|
| (Cash
Flow Statement) together with the notes forming part thereof, and we state
that we have |
|
| obtained
all the information and explanations which to the best of our knowledge and
belief were |
|
| necessary
for the purpose of our audit 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; |
|
|
| i)
the Balance Sheet and Profit and Loss Account together with the notes thereon |
|
| have
been drawn up in conformity with the Companies Ordinance, 1984 and |
|
| are
in agreement with the books of account and are further in accordance with |
|
| accounting
policies consistently applied; |
|
|
|
| ii)
the expenditure incurred during the year were for the purpose of 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 for the year then ended; and |
|
|
| (d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr |
|
| Ordinance, 1980. |
|
|
|
|
|
HYDER BHIMJI AND CO. |
|
| KARACHI:
the 29th November, 1999 |
|
Chartered Accountants |
|
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
|
Note |
1999 |
1998 |
|
|
|
No. |
Rupees |
Rupees |
|
|
|
|
|
| CAPITAL
& RESERVES: |
|
|
|
| Authorised
Capital: |
|
|
|
| 5,000,000
Ordinary Shares |
|
|
| of Rs. 10/- each. |
|
|
50,000,000 |
50,000,000 |
|
|
|
|
========== |
========== |
|
| Issued,
Subscribed & Paid-up Capital |
|
3 |
28,102,030 |
25,547,300 |
|
|
|
|
|
|
|
|
|
| RESERVES: |
|
|
|
|
| Capital |
|
|
4 |
19,500,000 |
19,500,000 |
|
| Revenue |
|
|
4 |
38,000,000 |
36,000,000 |
|
| Reserve
for Issue of Bonus Shares |
|
|
-- |
2,554,730 |
|
| Unappropriated
Profit |
|
|
798,758 |
1,255,014 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
58,298,758 |
59,309,744 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
86,400,788 |
84,857,044 |
|
| SURPLUS
ON REVALUATION OF |
|
|
| FIXED ASSETS |
|
|
5 |
67,763,005 |
67,763,005 |
|
| LIABILITIES
AGAINST ASSETS SUBJECT |
|
|
|
| TO
FINANCE LEASE |
|
6 |
1,482,507 |
2,197,842 |
|
| DEFERRED
LIABILITIES |
|
7 |
75,893,683 |
63,083,889 |
|
|
|
|
|
|
|
| CURRENT
LIABILITIES: |
|
|
| Short
Term Loans -- unsecured |
|
8 |
24,296,484 |
17,308,962 |
|
| Short
Term Running Finance utilized |
|
|
|
|
| under
mark-up arrangements (Secured) |
|
9 |
69,316,559 |
53,295,427 |
|
| Current
Portion of Liabilities against |
|
|
|
|
| Assets
Subject to Finance Lease |
|
|
1,234,666 |
1,242,961 |
|
| Creditors,
Accrued and Other Liabilities |
|
10 |
30,133,188 |
87,246,151 |
|
| Proposed
Dividend |
|
|
7,728,058 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
132,708,955 |
159,093,501 |
|
| Contingencies
and Commitments |
|
|
11 |
-- |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
Total Rupees |
364,248,938 |
376,995,281 |
|
|
|
|
========== |
========== |
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
| Operating
Fixed Assets |
|
12 |
149,530,783 |
157,770,318 |
|
| Stores
and Spares held for |
|
|
|
| Capital
Expenditure |
|
|
5,151,659 |
5,577,187 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
154,682,442 |
163,347,505 |
|
| LONG
TERM LOANS AND ADVANCES |
|
13 |
3,227,864 |
3,838,623 |
|
| LONG
TERM DEPOSITS |
|
14 |
1,538,864 |
1,120,220 |
|
|
|
|
|
|
|
| CURRENT
ASSETS: |
|
|
|
| Stores,
Spares & Loose Tools |
|
15 |
21,606,661 |
21,405,932 |
|
| Stock-in-Trade |
|
16 |
123,494,042 |
114,589,603 |
|
| Trade
Debts (Unsecured) |
|
|
|
| Considered
Good |
|
17 |
12,995,404 |
26,875,125 |
|
|
|
|
|
| Loan
and Advances |
|
18 |
6,068,046 |
6,405,115 |
|
| Trade
Deposits & Prepayments |
|
19 |
3,344,070 |
8,250,999 |
|
| Other
Receivables |
|
20 |
6,273,596 |
9,067,179 |
|
| Income
Tax Refundable |
|
|
15,894,252 |
20,843,804 |
|
| Cash
& Bank Balances |
|
21 |
15,123,697 |
1,251,176 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
204,799,768 |
208,688,933 |
|
|
|
|
------------------ |
------------------ |
|
|
Total Rupees |
364,248,938 |
376,995,281 |
|
|
|
|
========== |
========== |
|
| NOTE:
The annexed notes form an integral part of these accounts. |
|
|
| KARACHI:
the 29th November, 1999 |
|
|
|
MOHAMMED A. JAMAL |
|
|
Chief Executive |
|
|
ALl RAZA GHULAMALI |
|
Directors |
|
|
|
|
RAZA HUSSAIN VIRJI WALJI |
|
| KARACHI:
the 29th November, 1999 |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
Note |
1999 |
1998 |
|
|
|
No. |
Rupees |
Rupees |
|
|
|
|
| Sales |
|
22 |
414,324,385 |
521,721,302 |
|
| Cost
of Goods Sold |
|
23 |
(342,267,574) |
(417,675,347) |
|
|
|
|
------------------ |
------------------ |
|
| Gross Profit |
|
|
72,056,811 |
104,045,955 |
|
| Trading Loss |
|
|
(59,218) |
( 1,754,623) |
|
|
|
------------------ |
------------------ |
|
|
|
102,291,332 |
71,997,593 |
|
|
|
|
| OPERATING
EXPENSES: |
|
|
|
| Administrative |
|
|
25 |
(16,547,881) |
(15,878,984) |
|
| Selling
and Distribution |
|
26 |
(12,965,225) |
(14,314,739) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(29,513,106) |
(30,193,723) |
|
|
|
|
------------------ |
------------------ |
|
| Operating Profit: |
|
|
|
|
42,484,487 |
72,097,609 |
|
| Net
Income from Rice Division |
|
|
27 |
11,748,221 |
6,363,522 |
|
| Other Income |
|
|
|
28 |
1,394,958 |
1,662,751 |
|
|
|
|
------------------ |
------------------ |
|
| Financial
Charges |
|
29 |
(19,855,710) |
(11,067,472) |
|
| Other Charges |
|
30 |
(2,640,767) |
(7,680,223) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(22,496,477) |
(18,747,695) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
for the year before taxation |
|
|
33,131,189 |
61,376,187 |
|
| Provision
for Taxation |
|
31 |
(24,000,000) |
(15,600,000) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
|
9,131,189 |
45,776,187 |
|
| Prior
period Items |
|
32 |
140,613 |
(27,927,211) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
for the year |
|
|
9,271,802 |
17,848,976 |
|
| Profit
brought forward |
|
|
1,255,014 |
960,768 |
|
|
|
|
------------------ |
------------------ |
|
| Balance
available for appropriation |
|
|
10,526,816 |
18,809,744 |
|
|
|
|
|
|
| Appropriations: |
|
|
|
| Transfer
to General Reserve |
|
|
(2,000,000) |
(15,000,000) |
|
| Proposed
Dividend @ 27 (1/2) % |
|
|
(7,728,058) |
-- |
|
| Transfer
to Reserve for Issue of Bonus Shares (10%) |
|
-- |
(2,554,730) |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
Profit Carried Forward |
|
|
798,758 |
1,255,014 |
|
|
|
|
========== |
========== |
|
|
| NOTE:
The annexed notes form an integral part of these accounts. |
|
|
|
MOHAMMED A. JAMAL |
|
|
Chief Executive |
|
|
ALl RAZA GHULAMALI |
|
Directors |
|
|
|
|
RAZA HUSSAIN VIRJI WALJI |
|
| KARACHI:
the 29th November, 1999 |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION |
|
| (CASH
FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
|
|
1999 |
1998 |
|
|
|
|
|
Rupees |
Rupees |
|
|
|
|
| A.
CASH FROM OPERATING ACTIVITIES |
|
|
| Profit
before taxation |
|
33,131,189 |
61,376,187 |
|
| Adjustment
for non cash charges & other items: |
|
|
| Profit
on sale of fixed assets |
|
|
(171,688) |
(331,785) |
|
| Depreciation |
|
|
12,550,106 |
13,440,463 |
|
| Provision
for gratuity |
|
|
6,257,715 |
33,888,624 |
|
| Financial
charges |
|
|
19,855,710 |
11,067,472 |
|
| Payment
of gratuity |
|
|
(3,447,921) |
( 1,522,198) |
|
| Provision
for Doubtful Debts |
|
|
-- |
3,925,610 |
|
|
|
|
------------------ |
------------------ |
|
| OPERATING
PROFIT BEFORE PRIOR |
|
68,175,111 |
121,844,373 |
|
| PERIOD
ITEMS AND CHANGES IN |
|
|
| WORKING
CAPITAL |
|
|
|
|
|
|
| Prior
period items |
|
|
140,613 |
(27,927,211) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
68,315,724 |
93,917,162 |
|
|
|
|
|
|
| CHANGES
IN WORKING CAPITAL |
|
|
| (Increase)
/ decrease in current assets |
|
|
| Stores,
Spares & Loose Tools |
|
|
(200,729) |
(1,483,321) |
|
| Stock-in-Trade |
|
|
(8,904,439) |
(21,565,863) |
|
| Trade Debts |
|
|
13,879,721 |
(14,160,233) |
|
| Loan
& Advances |
|
|
2,444,966 |
(1,227,552) |
|
| Deposits
and Prepayments |
|
|
4,906,929 |
8,435,992 |
|
| Other
Receivables |
|
|
2,793,583 |
(2,739,579) |
|
|
|
|
| Increase
/ (decrease) in current liabilities |
|
|
| Short Term Loan |
|
|
6,987,522 |
(7,234,601) |
|
| Creditors,
accrued and other liabilities |
|
(60,552,757) |
(33,935,373) |
|
|
|
------------------ |
------------------ |
|
|
|
|
(38,645,204) |
(73,910,530) |
|
|
|
|
------------------ |
------------------ |
|
| Cash
generated from operations |
|
|
29,670,520 |
20,006,632 |
|
| Financial
charges paid |
|
|
(17,322,607) |
(17,005,487) |
|
| Income Tax paid |
|
|
(14,050,116) |
(28,092,203) |
|
| Income
Tax Refund received |
|
|
4,999,668 |
-- |
|
|
|
|
------------------ |
------------------ |
|
| NET
CASH FROM OPERATING ACTIVITIES |
