| Leather Up Limited |
|
|
|
|
|
|
|
|
| Annual
Report 1999 |
|
|
|
| CONTENTS |
|
|
| Corporate
Profile |
|
|
| Directors'
Report |
|
| Statistical Data |
|
|
|
| Pattern
of Shareholding |
|
|
| Notice
of Meeting |
|
|
| Auditor's
Report to the Members |
|
|
| Balance Sheet |
|
| Profit
& Loss Account |
|
|
| Statement
of Changes in Financial Position |
|
| Notes
to the Accounts |
|
|
|
| Corporate
Profile |
|
|
| BOARD
OF DIRECTORS |
|
|
| S.
Khalid H. Shah |
Chief Executive /
Director |
|
| M. A. Shah |
|
Director |
|
| Shahjehan Shah |
|
Director |
|
| R. All Shah |
|
Director |
|
| G. K. Shah |
|
Director |
|
| R. A. Shah |
|
Director |
|
| Aasim Shah |
|
Director |
|
|
| COMPANY
SECRETARY |
|
| Shafqat
Mahmood Khokhar |
|
|
| AUDITORS |
|
| Punjwani
& Company |
|
Rahim Iqbal Rafiq &
Company |
|
| Chartered
Accountants |
|
Chartered Accountants |
|
|
| LEGAL
ADVISOR |
|
| Abdul
Halim Pirzada & Company |
|
| Advocates |
|
|
| BANKERS |
|
| Muslim
Commercial Bank Ltd. |
|
| United
Bank Limited |
|
| Habib
Bank Limited |
|
| Faysal
Bank Limited |
|
|
| REGISTERED
OFFICE/FACTORY |
|
| Plot
No. 23/C, 15th Commercial Street, |
|
| Phase
II Ext., Defence Housing Authority, Karachi. |
|
|
| Plot
No. 20/C, Sunset Lane 9, Phase-II Ext., |
|
| D.H.A.,
Karachi. |
|
|
|
| DIRECTORS'
REPORT |
|
|
| The
Directors of your Company are pleased to present you herewith 8th Annual
Report together with the |
|
| Audited
Accounts of the Company and the Auditor's Report thereon. |
|
|
| FINANCIAL
RESULTS: |
|
|
|
|
|
30.06.99 |
30-06-98 |
|
|
|
|
Rupees |
Rupees |
|
|
|
|
| Profit
from operations |
|
|
|
4,846,114 |
4,137,779 |
|
| Provision
for taxation |
|
|
|
822,567 |
736,867 |
|
|
|
|
|
------------------ |
------------------ |
|
| Profit after tax |
|
|
|
4,023,547 |
3,400,912 |
|
| Un-appropriated
profit |
|
|
|
|
|
| brought
forward from last year |
|
|
|
11,483,020 |
14,082,708 |
|
|
|
|
|
------------------ |
------------------ |
|
| Available
for appropriation |
|
|
|
15,507,167 |
17,483,620 |
|
|
|
|
|
|
|
| Proposed
cash dividend @ 10% (1998-10%) |
|
|
6,000,000 |
6,000,000 |
|
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
profit |
|
|
|
9,507,167 |
11,483,820 |
|
|
|
|
|
========== |
========== |
|
| Earning
per share after tax |
|
|
|
0.67 |
0.57 |
|
|
|
| Inspite
of the fierce local and global competition and cyclic recession in the demand
for leather garments, the |
|
| performance
of your company under the period under review has been satisfactory. The
company in these trying |
|
| times
achieved the target of Rs. 164.513 Million turnover as compared to Rs.
147.373 million of last year. The |
|
| overall
sales increased by 11.63% through extensive marketing efforts as well as
maintaining the quality of our |
|
| products. |
|
|
| The
management is confident that the cyclic recession in the demand for Leather
garments should bottom out |
|
| in
coming years resulting in improved performance as well as higher profits. |
|
|
| For
the present financial year the directors and management of your company once
again by the grace of almighty- |
|
| Allah
fourth consecutive year under review since public issue have proposed 10%
final cash dividend |
|
| (i.e.
Re. 1.00/- share) which is in line with the company policy of sharing of
profits with the shareholders at all times |
|
| and
under all circumstances. |
|
|
| YEARS
2000 COMPLIANCE: |
|
| The
management of your company has take care of the "Millennium Bug".
It is pleasure to announce that all the |
|
| application
software have been made Y2K compliant and we are geared to meet any
contingency that arise to |
|
| the year 2000. |
|
|
| WORKER
MANAGEMENT RELATION: |
|
| The
management will like to put on the record valued contribution of all members
of the staff and workers towards |
|
| achieving
results in general. The worker management relation remained excellent
throughout the year which |
|
| resulted
in the smooth operation of your company. This is a team work and we hope is
shall continue in the same |
|
| atmosphere
during the coming years. |
|
|
| APPOINTMENT
OF AUDITORS: |
|
| The
present auditors M/s. Punjwani & Company Chartered Accountants and Rahim
Iqbal Rafiq & Co, Chartered |
|
| Accountants
retiring at the Annual General Meeting and being eligible, have offered
themselves for re- |
|
| appointment
until conclusion of the next Annual General Meeting. |
|
|
| PATTERN
OF SHARE HOLDING: |
|
| The
pattern of share holding i8 annexed with this report. |
|
|
| THANKS
AND APPRECIATION: |
|
| To
our shareholders for their trust and support now as well as in difficult
times. |
|
|
|
|
By order of the Board |
|
|
|
|
|
|
|
|
S. KHALID H. SHAH |
|
| Dated:
4th November, 1999 |
|
Chief Executive |
|
|
|
| STATISTICAL
DATA |
|
|
|
|
01-07-98 |
01-01-97 |
|
|
|
30-06-99 |
30-06-98 |
|
|
|
Rupees |
Rupees |
|
| PERIOD
AT A GLANCE |
|
|
|
| Turnover |
|
|
164,513,300 |
147,373,303 |
|
| Profit before tax |
|
|
4,846,114 |
4,137,779 |
|
| Taxation |
|
|
822,567 |
786,867 |
|
| Profit after tax |
|
|
4,023,547 |
3,400,912 |
|
| Gross
assets employed |
|
29,624,371 |
28,848,173 |
|
| Paid-up capital |
|
|
60,000,000 |
60,000,000 |
|
| Shareholders
equity |
|
71,707,167 |
73,683,620 |
|
| Earning
per share before tax |
|
0.81 |
0.69 |
|
| Cash dividend |
|
|
@ 10% i.e. |
@ 10% i.e. |
|
|
|
|
Re. 1.00/Share |
Re. 1.00/Share |
|
|
|
| PATTERN
OF SHAREHOLDINGS (Form 34) |
|
| As
at June 30, 1999 |
|
|
|
Number of |
|
SHAREHOLDING |
|
TOTAL |
|
| S. No. |
Share Holder |
FROM |
|
TO |
SHARES HELD |
|
|
|
|
| 1 |
543 |
1 |
-- |
100 |
54,300 |
|
| 2 |
2,219 |
101 |
-- |
500 |
1,091,400 |
|
| 3 |
93 |
501 |
-- |
1,000 |
90,600 |
|
| 4 |
115 |
1,001 |
-- |
5,000 |
297,100 |
|
| 5 |
19 |
5,001 |
-- |
10,000 |
151,000 |
|
| 6 |
2 |
10,001 |
-- |
15,000 |
26,900 |
|
| 7 |
3 |
15,001 |
-- |
20,000 |
50,700 |
|
| 8 |
1 |
25,001 |
-- |
30,000 |
26,000 |
|
| 9 |
1 |
35,001 |
-- |
40,000 |
35,500 |
|
| 10 |
2 |
50,001 |
-- |
55,000 |
104,000 |
|
| 11 |
2 |
55,001 |
-- |
60,000 |
114,400 |
|
| 12 |
1 |
70,001 |
-- |
75,000 |
73,700 |
|
| 13 |
1 |
75,001 |
-- |
80,000 |
80,000 |
|
| 14 |
1 |
80,001 |
-- |
85,000 |
81,100 |
|
| 15 |
1 |
85,001 |
-- |
90,000 |
89,000 |
|
| 16 |
1 |
90,001 |
-- |
95,000 |
92,000 |
|
| 17 |
4 |
95,001 |
-- |
100,000 |
392,300 |
|
| 18 |
2 |
145,001 |
-- |
150,000 |
300,000 |
|
| 19 |
1 |
235,001 |
-- |
240,000 |
240,000 |
|
| 20 |
1 |
245,001 |
-- |
250,000 |
250,000 |
|
| 21 |
1 |
385,001 |
-- |
390,000 |
389,800 |
|
| 22 |
1 |
400,001 |
-- |
405,000 |
404,800 |
|
| 23 |
1 |
460,001 |
-- |
465,000 |
464,900 |
|
| 24 |
1 |
500,001 |
-- |
505,000 |
500,500 |
|
| 25 |
1 |
595,001 |
-- |
600,000 |
600,000 |
|
|
------------------ |
|
|
------------------ |
|
|
3,018 |
|
|
6,000,000 |
|
|
========== |
|
|
|
========== |
|
|
| NOTE:
The slabs not applicable have not been shown. |
|
|
| CATEGORIES
OF |
|
NO. OF |
NO. OF |
HOLDING |
|
| SHAREHOLDERS |
|
SHARE |
SHARES HELD |
PERCENTAGE |
|
|
HOLDERS |
|
|
| Individuals |
|
3,015 |
5,741,600 |
95.693 |
|
| Joint
Stock Companies (C.D.C) |
|
1 |
96,000 |
1.600 |
|
| Financial
Institutions |
|
2 |
162,400 |
2.707 |
|
|
|
------------------ |
------------------ |
------------------ |
|
|
|
3,018 |
6,000,000 |
100.000 |
|
|
|
|
========== |
========== |
========== |
|
|
|
| NOTICE
OF ANNUAL GENERAL MEETING |
|
| (For
the Year Ended June 30, 1999) |
|
|
| Notice
is hereby given that the 8th Annual General Meeting of Leather Up Limited
will be held on Friday, |
|
| 24th
December 1999, at 3.30 p.m. at Hotel Regent Plaza, Karachi to transact the
following business; |
|
|
| 1.
To confirm the minutes of the 7th Annual General Meeting held on 24th
December, 1998. |
|
|
|
|
| 2.
To receive, consider and adopt the audited accounts of the Company for the
Year ended June, 30 |
|
| 1999
together with the Reports of the Auditor and Directors. |
|
|
|
|
|
| 3.
To approve the payment of dividend @ Re. 1.00 per share i.e. 10% as
recommended by the Directors. |
|
|
|
|
| 4.
To appoint auditors for the year ending June 30, 2000 end to fix their
remuneration. The present |
|
| auditors
M/s. Rahim Iqbal Rafiq & Company, Chartered Accountants and M/s. Punjwani
& Company, |
|
| Chartered
Accountants being eligible, have offered themselves for re-appointment. |
|
|
| 5.
To transact any other business with the permission of the Chairman. |
|
|
|
|
By Order of the Board |
|
|
|
|
|
|
|
|
Shafqat Mahmood Khokhar |
|
| Dated:
4th November, 1999 |
|
Company Secretary |
|
|
| NOTES: |
|
|
| 1.
The share transfer books of the company will remain closed from 27th November
to 4th December, 1999 (both |
|
| days inclusive). |
|
|
| 2.
A member entitled to attend and vote at this meeting may appoint another
member as his/her proxy to attend and |
|
| vote
on his/her behalf. Proxies in order to be valid must be received by the
company not less than 48 hours before |
|
| the
time of the meeting. |
|
|
| 3.
According to the verdict of Supreme Court of Pakistan dated March 09, 1999 it
is now permissible for |
|
| Shareholders
who belong to any recognized fiqah to file declaration as required by the
Zakat and Ushr |
|
| Ordinance,
1980 and claim exemption from compulsory deduction of Zakat. This facility
was previously available |
|
| only
to members of Fiqah-e-Jafria. Those who wish to do so are requested to submit
the said declaration on Form |
|
| CZ-50
on non-judicial stamp paper of Rs. 20, duly attested by the Notary Public at
registered office of the |
|
| Company. |
|
|
|
|
| 4.
Shareholders are requested to promptly notify the company of any change in
their address. |
|
|
|
| AUDITOR'S
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed balance sheet of LEATHER UP LIMITED as at June 30,
1999 and the related |
|
| profit
& loss account and 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 |
|
| informations
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 accounts have been kept by the Company as
required by the |
|
| Companies
Ordinance, 1984; |
|
|
|
|
| (b)
in our opinion: |
|
|
| i)
the balance sheet and profit & 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
accounts and are further in accordance with the 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 & 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; and |
|
|
|
|
|
|
| (d)
in our opinion, Zakat deductible at source under the Zakat and Ushr
Ordinance, 1980 was deducted |
|
| by
the company and deposited in the Central Zakat Fund established under section
7 of that |
|
| Ordinance. |
|
|
|
|
| Without
qualifying our opinion, we draw attention to the note 1 of the financial
statements. Expansion |
|
| programme
has been deferred due to the reason stated in that note. |
|
|
|
Rahim Iqbal Rafiq & Co. |
|
Punjwani & Co. |
|
|
Chartered Accountants |
|
(Chartered Accountants) |
|
|
| KARACHI:
the 5th day of November, 1999. |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
|
Year |
Year |
|
|
|
Ended |
Ended |
|
|
|
June 30, |
June 30, |
|
|
|
1999 |
1998 |
|
|
Note |
Rupees |
Rupees |
|
|
|
|
| SHARE
CAPITAL AND RESERVES |
|
|
|
|
|
| Authorised
share capital |
|
|
|
| 6,000,000
Ordinary shares |
|
|
|
| of Rs. 10/- each |
|
|
60,000,000 |
60,000,000 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| Issued,
subscribed and paid up capital |
|
3 |
60,000,000 |
60,000,000 |
|
| General reserve |
|
|
2,200,000 |
2,200,000 |
|
| Unappropriated
profit |
|
|
9,507,167 |
11,483,620 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
71,707,167 |
73,683,620 |
|
| DEFERRED
LIABILITIES |
|
|
|
| Staff
retirement gratuity |
|
1,079,149 |
807,975 |
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
| Short
term finances |
|
|
4 |
102,500,000 |
89,000,000 |
|
| Creditors,
accrued and other liabilities |
|
5 |
24,501,840 |
10,084,774 |
|
| Provision
for taxation |
|
|
|
822,567 |
736,867 |
|
| Dividend
(Proposed 10%) |
|
|
|
6,000,000 |
6,000,000 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
133,824,407 |
105,821,641 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
6 |
-- |
-- |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
206,610,723 |
180,313,236 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| TANGIBLE
FIXED ASSETS |
|
|
|
|
| Operating
fixed assets |
|
7 |
22,209,485 |
22,519,022 |
|
| DEFERRED
COST |
|
8 |
281,151 |
865,617 |
|
| INVESTMENTS |
|
9 |
23,676,414 |
-- |
|
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Stock-in-trade |
|
10 |
93,514,707 |
66,834,880 |
|
| Trade debts |
|
11 |
18,803,251 |
29,346,974 |
|
| Advances,
deposits, prepayments & other receivable |
12 |
16,504,457 |
9,452,129 |
|
| Cash
and bank balances |
|
13 |
31,621,258 |
51,294,614 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
160,443,673 |
156,928,597 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
206,610,723 |
180,313,236 |
|
|
|
|
========== |
========== |
|
| The
annexed notes 1 to 27 form an integral part of these financial statements. |
|
|
|
|
|
|
S. KHALID H. SHAH |
|
SHAHJEHAN SHAH |
|
|
Chief Executive |
|
Director |
|
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
Year |
Year |
|
|
|
|
Ended |
Ended |
|
|
|
|
June 30, |
June |
|
|
|
|
1999 |
1998 |
|
|
|
Note |
Rupees |
Rupees |
|
|
|
|
|
| Sale |
|
|
14 |
179,010,013 |
160,678,678 |
|
| Cost
of goods sold |
|
|
15 |
(143,630,019) |
(131,922,662) |
|
|
|
|
------------------ |
------------------ |
|
| Gross Profit |
|
35,379,994 |
28,756,016 |
|
|
|
|
|
| Operating
Expenses |
|
|
| Administration |
|
16 |
10,209,301 |
9,598,976 |
|
| Selling
& distribution |
|
17 |
13,387,100 |
11,060,557 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(23,596,401) |
(20,659,533) |
|
|
|
|
------------------ |
------------------ |
|
| Operating Profit |
|
|
|
11,783,593 |
8,096,483 |
|
| Other Income |
|
|
18 |
3,019,975 |
3,973,831 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
14,803,568 |
12,070,314 |
|
|
|
|
|
|
| Financial
charges |
|
|
19 |
9,702,395 |
7,714,757 |
|
| Worker's
profit participation fund |
|
|
255,059 |
217,778 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
(9,957,454) |
(7,932,535) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
before taxation |
|
|
|
4,846,114 |
4,137,779 |
|
| Provision
for taxation |
|
|
|
(822,567) |
(736,867) |
|
|
|
|
------------------ |
------------------ |
|
| Profit
after taxation |
|
|
|
4,023,547 |
3,400,912 |
|
| Unappropriated
profit brought forward |
|
|
11,483,620 |
14,082,708 |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
15,507,167 |
17,483,620 |
|
| Appropriation |
|
|
|
| Proposed
dividend @ Re: 1.00 per share (1999: 10%) (1998: 10%) |
|
(6,000,000) |
(6,000,000) |
|
|
|
|
------------------ |
------------------ |
|
| Unappropriated
profit carried forward |
|
|
9,507,167 |
11,483,620 |
|
|
|
|
========== |
========== |
|
| Earning
per share |
|
|
20 |
0.67 |
0.57 |
|
|
|
| The
annexed notes 1 to 27 form an integral part of these financial statements |
|
|
|
S. KHALID H. SHAH |
|
SHAHJEHAN SHAH |
|
|
Chief Executive |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN FINANCIAL POSITION (CASH FLOW STATEMENT) |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
|
Year |
Year |
|
|
|
|
Ended |
Ended |
|
|
|
|
June 30, |
June 30, |
|
|
|
|
1999 |
1998 |
|
|
|
|
Rupees |
Rupees |
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
|
| Profit
before taxation |
|
|
4,846,114 |
4,137,779 |
|
|
|
|
|
| Adjustments
for: |
|
|
|
| Depreciation |
|
|
|
1,085,735 |
1,117,500 |
|
| Financial
charges |
|
|
|
9,702,395 |
7,714,757 |
|
| Gratuity net |
|
|
|
|
271,174 |
185,445 |
|
| Amortization
of deferred cost |
|
|
|
584,466 |
584,466 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
11,643,770 |
9,602,168 |
|
|
|
|
------------------ |
------------------ |
|
| Operating
profit before working capital changes |
|
|
16,489,884 |
13,739,947 |
|
|
|
|
| Changes
in working capital: |
|
|
|
| (Increase)
/ Decrease in current assets |
|
|
|
|
|
|
| Stock in trade |
|
|
|
|
(26,679,827) |
(32,211,741) |
|
| Trade debts |
|
|
|
|
10,543,723 |
(40,834) |
|
| Advances,
deposits prepayments & other receivables |
|
(7,052,328) |
5,021,903 |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
|
(23,188,432) |
(27,230,672) |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
(6,698,548) |
(13,490,725) |
|
| Increase
/ (Decrease) in current liabilities |
|
|
| Creditors |
|
|
|
13,718,203 |
557,984 |
|
| Accrued
& other liabilities |
|
|
|
(14,175) |
(1,213,887) |
|
| Dividend paid |
|
|
|
|
(5,865,373) |
(8,797,836) |
|
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
|
7,838,655 |
(9,453,739) |
|
| Cash
(used in) / generated from operation |
|
|
1,140,107 |
(22,944,464) |
|
|
|
|
------------------ |
------------------ |
|
| Financial
charges paid |
|
|
(9,123,984) |
(7,714,757) |
|
| Taxes paid |
|
|
(736,867) |
(812,759) |
|
|
|
|
