| Maple Leaf Cement |
|
|
|
|
|
|
|
|
| Factory Limited |
|
|
| Company
Information |
|
| Notice of Meeting |
|
| Directors' Report |
|
|
| Five
Years Summary |
|
| Pattern
of Shareholding |
|
| Auditors' Report |
|
|
| Balance Sheet |
|
|
| Profit
and Loss Account |
|
| Cash
Flow Statement |
|
| Notes
To The Accounts |
|
|
|
|
| COMPANY
INFORMATION |
|
|
| Board
of Directors |
|
Auditors |
|
| Mr.
Tariq Sayeed Saigol |
|
Ford, Rhodes, Robson,
Morrow |
|
| Chairman/Chief
Executive |
|
Chartered Accountants |
|
|
| Mr.
Taufique Sayeed Saigol |
|
Legal Advisors |
|
| Mr. Usman Said |
|
1.Cornelius Lane and
Mufti |
|
| Mr.
Aamir Fayyaz Sheikh |
|
Advocates &
Solicitors, |
|
| Mr. Sarmad Amin |
|
Lahore. |
|
| Mr.
Mansur Aly Malik |
|
| Mr. Henrik Starup |
|
2. Mr. Nomaan Akram Raja |
|
| (Representing
FLS & IFU) |
|
Barrister-At-Law |
|
|
| Mr.
Mahmood Ahmad |
|
Raja Mohammad Akram &
Co. |
|
| (Rep.
Crescent Investment Bank Ltd.) |
|
Advocates and Legal
Consultants, |
|
|
Lahore. |
|
|
|
| Company
Secretary |
|
Registered Office |
|
| Mr.
Mohammed Sharif |
|
42-Lawrence Road, Lahore. |
|
|
Phone: 6278904-5 |
|
| Bankers
of the Company |
|
Fax: (042) 6363184 |
|
| Allied
Bank of Pakistan Limited |
|
E-mail:
cement@maple.lcci.org.pk |
|
| American
Express Bank Limited |
|
| The
Bank of Punjab |
|
Factory |
|
| Habib
Bank Limited |
|
Iskanderabad Distt.
Mienwall. |
|
| Muslim
Commercial Bank Limited |
|
Phones: (0459) 392237-8 |
|
| Soneri
Bank Limited |
|
| United
Bank Limited |
|
|
| NOTICE
OF THE ANNUAL GENERAL MEETING |
|
| Notice
is hereby given that the 39th Annual General Meeting of the members of |
|
| Maple
Leaf Cement Factory Limited will be held at its registered office,
42-Lawrence |
|
| Road,
Lahore on Saturday, 29th January, 2000 at 10.30 A.M. to transact the
following |
|
| business: |
|
|
| 1)
To confirm the minutes of the last Annual General Meeting. |
|
|
| 2)
To receive and adopt Audited Accounts of the company for the year ended |
|
| June
30, 1999 together with Auditors' and Directors' Reports thereon. |
|
|
| 3)
To appoint Auditors and fix their remuneration. |
|
|
| The
present auditors, M/s Ford, Rhodes, Robson, Morrow, Chartered Accountants, |
|
| retire
and being eligible, offer themselves for re-appointment for the year |
|
| 1999-2000. |
|
|
| 4)
To transact any other business with the permission of Chair. |
|
|
| Share
Transfer Books |
|
| Share
Transfer Books of the company will remain closed from 25th January, 2000 to |
|
| 31st
January, 2000 (both days inclusive). Transfers received in order at company's |
|
| Shares
Department, 42-Lawrence Road, Lahore upto the close of business on 24th |
|
| January,
2000 will be treated in time. |
|
|
|
By order of the Board |
|
|
Mohammad Sharif |
|
| Lahore:
January 04, 2000. |
|
Company Secretary |
|
|
| Notes: |
|
| 1.
A member eligible to attend and vote at this meeting may appoint another |
|
| member as his/her proxy to attend and vote
instead of him/her. Proxies in order |
|
| to be effective must reach the company's
registered office not less than 48 |
|
| hours before the time for holding the
meeting. |
|
|
| 2.
Shareholders are requested to immediately notify the change in address, if
any. |
|
|
|
| DIRECTORS'
REPORT TO THE SHAREHOLDERS |
|
| Your
Directors present their annual report together with audited accounts of the |
|
| company
for the year ended June 30,1999. |
|
|
| Performance |
|
| The
net sales revenue for the year under report amounted to Rs. 2,133.391 million |
|
| /1998:
Rs. 925.646 million) and pro-tax loss Rs. 578.976 million after charging
depreciation |
|
| Rs.
732.0 million and financial charges Rs. 5©2.7 million (1998: Rs. 368.517
million after |
|
| depreciation
Rs. 279.7 million and financial charges Rs. 133 million). |
|
|
| The
loss for the year is attributable to depressed selling price in first quarter
of the |
|
| year,
which touched the lowest level in last five years. Low capacity utilization,
high |
|
| financial
& depreciation charge and continued levy of unbearable government |
|
| taxes
are mainly responsible for the loss. |
|
|
| The
Company commenced work on its expansion project in 1994-95 when the |
|
| historical
annual growth in cement demand was 7% with per capita consumption |
|
| of
only 71 kg being the lowest in the developing countries. It was, therefore, |
|
| expected
that the growth rate of cement consumption would accelerate due to |
|
| the
urbanization and revival of the economy. The expansion project started |
|
| commercial
production in April, 98 when national capacity of cement had doubled |
|
| while
the demand remained depressed. Demand for cement failed to grow at the |
|
| pace
of increased supply due to low down in the economy, decline in construction |
|
| activity
and cutting down of government development expenditure. The prices |
|
| remained
low in over supply market despite rise in costs. The global recession also |
|
| aggravated
the problem. The low selling price, under capacity operations and rising |
|
| costs
resulted in huge losses and liquidity crunch rendering the company, unable |
|
| to
make debt servicing on schedule. |
|
|
| Rescheduling
of Long Term Debts |
|
| The
company took up with International Finance Corporation (IFC), USA and other |
|
| long
term lenders for rescheduling of long term loans and has negotiated a frame |
|
| work:
for restructuring including rescheduling of the term of loan with IFC. The
Bank: |
|
| of
Punjab has finalised the rescheduling of its long term loan. The respective
Board |
|
| of
Directors' approvals are expected shortly. Muslim Commercial Bank Ltd has |
|
| already
rescheduled its long term loan. |
|
|
| Production
& Sales |
|
| The
production and sales for the year under review compare favourably with last |
|
| year
and are given as under: |
|
|
|
Grey |
White |
|
|
Clinker |
Cement |
Clinker |
Cement |
|
| PRODUCTION
(M. Tonnes) |
|
|
1999 |
849,777 |
893,975 |
34,470 |
35,883 |
|
|
1998 |
538,528 |
551,473 |
31,905 |
32,700 |
|
|
|
|
|
|
Grey Cement |
White Cement |
|
| SALES
(M. Tonnes) |
|
|
1999 |
900,243 |
|
36,752 |
|
|
1998 |
545,319 |
|
32,758 |
|
|
| The
overall capacity utilization during the year was only 58% owing to the
reasons |
|
| enumerated
earlier. |
|
|
| Financial
Results |
|
|
| The
financial results are as under |
|
|
(Rs. in thousand) |
|
|
| Net Revenue |
|
2,133,391 |
|
| Expenditure |
|
2,748,604 |
|
| Other income |
|
36,237 |
|
| Loss
before taxation |
|
(578,976) |
|
| Provision
for taxation |
|
11,157 |
|
| Loss
after taxation carried over |
|
(590,133) |
|
|
| There
being net loss for the year and negative Earning Per Share (EPS), no dividend |
|
| is recommended. |
|
|
| ISO
9002 Certification |
|
| To
have global recognition and standardization of the product, the management |
|
| has
successfully completed ISO 9002 certification from M/s Lloyd Register Quality |
|
| Assurance
U.K., a world renowned company. This is a milestone achievement and |
|
| the
certification stands for consistent quality of our product and provides basis
for |
|
| export
opportunity in future. |
|
|
| Future
Prospects |
|
| Cement
Industry is continuously under pressure due to inconsistent economic and |
|
| financial
policies of the Government. The cement units started in 1994-95 have been |
|
| adversely
affected by changing policies of tax structure. At the time of opening of |
|
| Letters
of Credit in 1994, plant and machinery were exempt from payment of whole |
|
| of
custom duty and sales tax vide SRO 484(1 )/92 dated 14th May, 1992. On its
expiry, |
|
| SRO
No. 978(1)/95 dated 4th October, 1995 was issued requiring payment of one |
|
| fourth
of custom duty and sales tax on plant & machinery provided letter of
credit |
|
| was
established before 30th June, 1995. In addition, regulatory duty equivalent
to |
|
| 10%
was also imposed. The company has approached the honourable Lahore High |
|
| Court
for relief and the matter is pending adjudication. Payment has been started |
|
| since
April, 99 in installments owing to the department's recovery drive after
vacation |
|
| of
the stay order granted by the Lahore High Court as a consequence of the
decision |
|
| of
the Supreme Court limiting injunctions in financial matters to a period of
six months. |
|
|
| As
a part of its plan for efficient operations, the management has paid off 135 |
|
| workers
and 29 supervisors under the golden handshake scheme which were |
|
| declared
surplus. With the improvement in the market conditions the cement sale |
|
| has
witnessed increase subsequently. The capacity utilization has increased from |
|
| 58%
in 1999 to around 65% in the first quarter of current year 1999-2000. With
the |
|
| arrangement
for rescheduling of long term debt and satisfactory level of operations, |
|
| the
company we hope will be out of crisis soon. |
|
|
| Presently,
the taxation on cement industry is the highest in the world. Sales tax paid |
|
| on
furnace oil, power and other inputs cannot be adjusted against output tax as |
|
| cement
is exempt from sales tax. It is suggested that sales tax paid on inputs
should |
|
| be
adjusted against the excise duty by introducing Modified Excise Duty System, |
|
| as
was done in India. We are of the view that cement prices are too high due to |
|
| excessive
taxation and propose that on agreed basis, excise duty on cement should |
|
| be
reduced with simultaneous reduction in the ex-factory selling price of
cement. |
|
| This
will increase off-take and will also be a revenue neutral action as increased |
|
| consumption
will lead to recovering targeted duties at a lower per ton rate. |
|
|
| Millennium
Compliance |
|
| The
Directors are pleased to report that all necessary measures have been taken |
|
| regarding
the Millennium Bug. All systems have been up graded and are Y2K |
|
| compliant. |
|
|
| Auditors |
|
| M/s
Ford, Rhodes, Robson, Morrow, Chartered Accountants the present auditors |
|
| retire
and being eligible offer themselves for reappointment for next year. |
|
|
| Pattern
of Shareholding |
|
| The
Shareholding Pattern of the company as on June 30,1999 is included in the |
|
| Annual Report. |
|
|
| Labour
Management Relationship |
|
| The
labour management relations remained cordial throughout the year and Board |
|
| wishes
to place on record its appreciation for the dedicated efforts and services |
|
| rendered
by the officers and workers with the expectation that the same zeal would |
|
| be
coming forth in the years to come. |
|
|
|
For and on behalf of the
board |
|
|
(Tariq Sayeed Saigol) |
|
|
| Lahore
: December 27,1999 |
|
Chief Executive/Chairman |
|
|
| FIVE
YEARS SUMMARY |
|
|
1998-99 |
1997-98 |
1996-97 |
1995-96 |
1994-95 |
|
| Quantitative
Data (M.Tonnes) |
|
|
| Grey Cement: |
|
|
Production |
893,975 |
551,473 |
471,070 |
488,961 |
487,785 |
|
|
Sales |
900,243 |
545,318 |
474,415 |
481,881 |
492,611 |
|
|
| White Cement: |
|
|
Production |
35,883 |
32,700 |
33,412 |
34,720 |
38,299 |
|
|
Sales |
36,752 |
32,758 |
33,405 |
34,450 |
38,375 |
|
|
| Sales (Rs.000) |
|
| Gross sales |
|
3,675,155 |
1,630,218 |
1,911,471 |
1,675,074 |
1,803,122 |
|
| Less:
Excise duty |
1,455,355 |
676,269 |
604,718 |
397,782 |
433,530 |
|
|
Sales tax |
-- |
-- |
277,944 |
235,457 |
260,118 |
|
|
Rebate |
86,409 |
28,303 |
15,090 |
11,001 |
13,542 |
|
|
--------------------- |
--------------------- |
--------------------- |
--------------------- |
--------------------- |
|
| Net sales |
|
2,133,391 |
925,646 |
1,013,719 |
1,030,834 |
1,095,932 |
|
|
=========== |
=========== |
=========== |
=========== |
=========== |
|
|
| Profitability
(Rs.000) |
|
| Gross
Profit/(Loss) |
39,778 |
(67,312) |
52,081 |
201,972 |
352,405 |
|
| Profit/(Loss)
before tax |
(578,976) |
(368,517) |
40,041 |
238,554 |
342,817 |
|
| Provision
for income tax |
11,157 |
4,770 |
12,200 |
98,000 |
126,000 |
|
|
--------------------- |
--------------------- |
--------------------- |
--------------------- |
--------------------- |
|
| Profit/(Loss)
after tax |
(590,133) |
(373,287) |
27,841 |
140,554 |
216,817 |
|
|
=========== |
=========== |
=========== |
=========== |
=========== |
|
|
| Financial
Position (Rs.000) |
|
| Tangible
fixed assets-net |
6,099,791 |
6,349,668 |
5,966,034 |
3,780,420 |
1,481,822 |
|
| Investment
& other assets |
20,066 |
21,248 |
364,466 |
380163 |
376,870 |
|
|
6,119,857 |
6,370,916 |
6,330,500 |
4,160,583 |
1,858,692 |
|
| Current assets |
|
798,888 |
852,693 |
844,219 |
1,880,883 |
2,102,296 |
|
| Current liabilities |
|
(1,702,401) |
(1,216,183) |
(554,900) |
(380,854) |
(324,102) |
|
| Net
working capital |
(903,513) |
(363,490) |
289,319 |
1,500,029 |
1,778,194 |
|
| Capital employed |
|
5,216,344 |
6,007,426 |
6,619,819 |
5,660,612 |
3,636,886 |
|
| Less
Long term loan & other liab. |
(2,676,399) |
(2,877,348) |
(3,116,454) |
(2,557,172) |
(673,999) |
|
|
--------------------- |
--------------------- |
--------------------- |
--------------------- |
--------------------- |
|
| Share
holders Equity |
2,539,945 |
3,130,078 |
3,503,365 |
3,103,440 |
2,962,887 |
|
|
=========== |
=========== |
=========== |
=========== |
=========== |
|
|
| Represented
By: |
|
| Share capital |
|
1,302,293 |
1,302,293 |
1,302,293 |
930,209 |
826,853 |
|
| Reserves
& un-app. profit |
1,237,652 |
1,827,785 |
2,201,072 |
2,173,231 |
2,136,034 |
|
|
--------------------- |
--------------------- |
--------------------- |
--------------------- |
--------------------- |
|
|
2,539,945 |
3,130,078 |
3,503,365 |
3,103,440 |
2,962,887 |
|
|
=========== |
=========== |
=========== |
=========== |
=========== |
|
| Ratios: |
|
| Gross
Profit/(Loss) to sales (%age) |
1.86 |
(7.27) |
5.14 |
19.59 |
32.16 |
|
| Net
Profit/(Loss) to sales (%age) |
(57.66) |
(40.33) |
2.75 |
13.63 |
19.78 |
|
| Debt equity ratio |
|
49:51 |
47:53 |
45:55 |
44:56 |
15:85 |
|
| Current ratio |
|
0.47 |
0.69 |
1.52 |
4.94 |
6.49 |
|
| Break
up value per share of Rs. 10 each |
19.50 |
24.04 |
26.90 |
33.36 |
35.83 |
|
|
| PATTERN
OF SHAREHOLDING |
|
| AS
ON JUNE 30, 1999 |
|
|
Size |
of |
Holding |
|
|
|
No. of |
|
No. of |
|
|
Shareholders |
From |
To |
Shares Held |
|
|
|
781 |
1 |
100 |
35,290 |
|
|
2309 |
101 |
500 |
705,073 |
|
|
2082 |
501 |
1000 |
1,594,821 |
|
|
4263 |
1001 |
5000 |
8,426,691 |
|
|
589 |
5001 |
10000 |
4,046,180 |
|
|
156 |
10001 |
15000 |
1,875,236 |
|
|
86 |
15001 |
20000 |
1,512,315 |
|
|
36 |
20001 |
25000 |
813,206 |
|
|
30 |
25001 |
30000 |
835,635 |
|
|
22 |
30001 |
35000 |
716,835 |
|
|
25 |
35001 |
40000 |
945,707 |
|
|
5 |
40001 |
45000 |
210,774 |
|
|
6 |
45001 |
50000 |
288,649 |
|
|
10 |
50001 |
55000 |
528,447 |
|
|
17 |
55001 |
60000 |
976,774 |
|
|
7 |
60001 |
65000 |
437,136 |
|
|
7 |
65001 |
70000 |
475,045 |
|
|
9 |
70001 |
75000 |
658,569 |
|
|
6 |
75001 |
80000 |
467,217 |
|
|
4 |
80001 |
85000 |
329,645 |
|
|
4 |
85001 |
90000 |
348,672 |
|
|
1 |
90001 |
95000 |
93,500 |
|
|
5 |
95001 |
100000 |
493,750 |
|
|
1 |
100001 |
105000 |
104,500 |
|
|
2 |
110001 |
115000 |
225,331 |
|
|
I |
115001 |
120000 |
115,500 |
|
|
2 |
120001 |
125000 |
248,108 |
|
|
1 |
130001 |
135000 |
130,697 |
|
|
5 |
135001 |
140000 |
690,359 |
|
|
1 |
140001 |
145000 |
142,712 |
|
|
2 |
150001 |
155000 |
304,562 |
|
|
1 |
155001 |
160000 |
156,600 |
|
|
1 |
180001 |
185000 |
181,850 |
|
|
1 |
190001 |
195000 |
190,500 |
|
|
2 |
195001 |
200000 |
400,000 |
|
|
I |
200001 |
205000 |
201,012 |
|
|
2 |
215001 |
220000 |
438,800 |
|
|
3 |
245001 |
250000 |
744,332 |
|
|
1 |
260001 |
265000 |
261,500 |
|
|
1 |
265001 |
270000 |
270,000 |
|
|
2 |
285001 |
290000 |
574,500 |
|
|
1 |
295001 |
300000 |
297,500 |
|
|
1 |
345001 |
350000 |
345,500 |
|
|
1 |
360001 |
365000 |
364,500 |
|
|
1 |
395001 |
400000 |
395,225 |
|
|
I |
435001 |
440000 |
435,645 |
|
|
1 |
445001 |
450000 |
447,778 |
|
|
1 |
600001 |
605000 |
604,700 |
|
|
1 |
610001 |
615000 |
610,860 |
|
|
1 |
675001 |
680000 |
677,462 |
|
|
1 |
805001 |
810000 |
808,348 |
|
|
1 |
870001 |
875000 |
871,170 |
|
|
1 |
885001 |
890000 |
885,168 |
|
|
1 |
985001 |
990000 |
989,500 |
|
|
1 |
995001 |
1000000 |
1,000,000 |
|
|
1 |
1200001 |
1205000 |
1,202,000 |
|
|
1 |
2310001 |
2315000 |
2,313,800 |
|
|
1 |
2560001 |
2565000 |
2,562,137 |
|
|
1 |
4700001 |
4705000 |
4,702,625 |
|
|
1 |
5995001 |
6000000 |
6,000,000 |
|
|
1 |
6845001 |
6850000 |
6,848,010 |
|
|
2 |
6935001 |
6940000 |
13,873,091 |
|
|
1 |
7235001 |
7240000 |
7,239,724 |
|
|
1 |
11180001 |
11185000 |
11,180,374 |
|
|
1 |
13955001 |
13960000 |
13,959,036 |
|
|
1 |
19415001 |
19420000 |
19,419,141 |
|
|
-------------------------------------- |
|
---------------------- |
|
| Grand Total: |
10,516 |
|
130,229,324 |
|
|
=================== |
|
=========== |
|
|
| Categories of |
|
No. of |
Shares |
Percentage |
|
| Shareholders |
|
Shareholders |
Held |
Of Capital |
|
|
| Individuals |
|
10,351 |
32,802,090 |
25.19 |
|
| Investment
Companies |
39 |
10,743,334 |
8.25 |
|
| Insurance
Companies |
6 |
992,112 |
0.76 |
|
| Joint
Stock Companies |
61 |
33,351,288 |
25,610 |
|
| Financial
Institutions |
6 |
6,072,253 |
4.66 |
|
| Foreign
Companies |
32 |
45,701,126 |
35.09 |
|
| Modaraba
Companies |
16 |
486,621 |
374 |
|
| Others |
|
5 |
80,500 |
62 |
|
|
------------------- |
------------------- |
------------------- |
|
|
Grand Total: |
10,516 |
130,229,324 |
100.000 |
|
|
=========== |
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| AUDITORS'
REPORT TO THE MEMBERS |
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| We
have audited the annexed balance sheet of Maple Leaf Cement Factory |
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| Limited
as at June 30, 1999 and the related profit and loss account and the statement |
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| of
changes in financial position, together with the notes forming part thereof,
for |
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| the
year then ended and we state that we have obtained all the information and |
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| explanations
which to the best of our knowledge and belief were necessary for the |
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| purposes
of our audit and, after due verification 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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| b) in our opinion: |
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| i)
the balance sheet and profit and loss account together with the notes |
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| thereon
have been drawn up in conformity with the Companies |
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| 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; |
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| ii)
the expenditure incurred during the year was for the purpose of the |
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| company's business; and |
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| iii)
the business conducted, investments made and the expenditure incurred |
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| during
the year were !n accordance with the objects of the company; |
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| c)
in our opinion and to the best of our information and according to the |
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| explanations given to us, the balance
sheet, profit and loss account and the |
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| statement of changes in financial position,
together with the notes forming |
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| part thereof, give the information required
by the Companies Ordinance, |
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| ] 984 in the manner so required and
respectively give a true and fair view of |
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| the state of the company's affairs as at
June 30, 1999 and of the loss and the |
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| changes in financial position for the year
then ended; and |
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| d)
in our opinion, no Zakat was deductible at source under the Zakat and Ushr |
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| Ordinance, 1980. |
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| Without
qualifying our opinion, we draw attention to note 1.1 to the accounts, which |
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| states
that these accounts have been prepared on a going concern basis for the |
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| reasons
as explained in the note. Consequently, these accounts do not include any |
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| adjustments
that might result from the outcome of the matters narrated in the note. |
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Ford, Rhodes, Robson, Morrow |
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| Lahore:
December 27, 1999 |
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Chartered Accountants |
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| BALANCE
SHEET AS AT JUNE 30, 1999 |
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1999 |
1998 |
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Note |
