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Noon Pakistan Limited
Annual Report 1999
CONTENTS
CORPORATE INFORMATION
NOTICE OF MEETING
DIRECTORS' REPORT
PATTERN OF SHARE HOLDING
AUDITORS' REPORT
BALANCE SHEET
PROFIT AND LOSS ACCOUNT
CASH FLOW STATEMENT
NOTES TO THE ACCOUNTS
FIVE YEARS' REVIEW AT A GLANCE
Corporate Information
BOARD OF DIRECTORS		Malik Manzoor Hayat Noon		Chairman
				and Chief Executive
		M. Anwar Mir
		K. Iqbal Talib
		Javed Ali Khan
		Ahmad Ali
		Raja Asghar Mehmood
		Shahid Nasim		(Nominee IcP)
MANAGEMENT		M. Anwar Mir		Managing Director
		Lt. Col. (Rtd.) M. Bashir Ahmad		General Manager
SECRETARY		Syed Anwar Ali
AUDITORS		Hameed Chaudhri & Company
		Chartered Accountants
LEGAL ADVISERS		Hamid Law Associates
BANKERS		International Finance Investment
		& Commerce Bank Limited  (IFIC)
		United Bank Limited
		National Bank of Pakistan
REGISTERED OFFICE		1st. Floor, Alfalah Building,
		Shahrah-e-Quaid-e-Azam,
		Lahore.
SHARES DEPARTMENT		66 - Garden Block,
		New Garden Town,
		Lahore.
		Tele · 5831462 - 5831463
MILLS		Bhalwal, District Sargodha.
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the 32nd Annual General Meeting of Noon Pakistan Ltd. will be
held at 66-Garden Block, New Garden Town, Lahore on Friday, 31 December, 1999 at
9.00 a.m. to transact the following business:-
1. To confirm the minutes of the Extraordinary General Meeting held on 30 June, 1999.
2. To receive, consider and adopt the audited accounts for the year ended 30 June, 1999
and the reports of the directors and auditors thereon.
3. To approve payment of dividend.
4. To appoint auditors for the ensuing period and fix their remuneration.
5. To transact any other business as may be placed before the meeting with the
permission of the Chairman.
The share transfer books of the Company shall remain closed from 23 December, 1999 to 31
December, 1999. Shares transfers received upto close of business on 22 December, 1999
shall entitle the transferees to the above dividend.
A member entitled to attend and vote at this meeting may appoint another member as
his/her proxy to attend, speak and vote on his/her behalf. Proxies in order to be effective
must be received by the Company at the registered office not less than 48 hours before the
meeting.
		By Order of the Board
Lahore: 7 December, 1999.		SYED ANWAR ALI
		Secretary
DIRECTORS' REPORT TO THE SHAREHOLDERS
Your Directors are pleased to welcome members to the 32rid Annual General Meeting of the
Company.
The year 1998/99 has seen an increase of 17% in Net Sales Income to Rs. 209 million, but has
also registered an increase in production costs of 22% to Rs. 184 million. The gross profit of
your Company has thus been reduced by 14% to Rs. 25.4 million.
The decline in gross profits by Rs. 4.3 million was primarily caused by unusually high (19%)
increase in costs of raw milk for which the market forces did not permit timely compensation
through increase in sales prices. At the same time the gross profit earnings suffered from an
increase in the proportional sales volumes of lower margin products.
The Company's expenses for marketing, selling and administration show an increase of Rs. 4.2
million over the previous year. About two third of the additional cost is due to increasing
competition in the market for consumer products.
The Net Profit for the year 1998/99 shows a financial loss after taxation of Rs. 1,062,555 which
your Directors recommend to be absorbed in full by the reserve for Unappropriated Profits as
follows:
		Rupees
Profit for the year before taxation		1,249,244
Provision for taxation,
- Current and prior years		2,311,799
		--------------------
		(1,062,555)
Unappropriated profit, brought forward		34,131,467
		--------------------
		33,068,912
Proposed Appropriation:
Proposed Dividend @ 20%		1,200,000
		--------------------
Unappropriated profit - carried to balance sheet		31,868,912
		===========
Your Directors have taken steps to a correction of the development of your Company's
activities. The operations of your Company appear already to have benefited from definition of
stringent short term objectives and the ensuing internal co-operation for their achievement. A
strengthening of your Company's working capital is under consideration.
It is pleasing to note that your Company over the past few months of the year 1999/2000 has
been working at an unprecedented high level of throughput. Even under current adverse
market conditions your Company appears to be able to improve upon its operational results
for the year. Your Directors are of the opinion that in the new millennium the consumers'
uncertainty in respect to the recent market developments will be dispelled, helping the demand
for your Company's products to return to a normal level. At the same time raw materials are
expected to be more easily available, facilitating your Company's efforts for improving the
quality of its products.
Your Directors confidence in your Company's immediate future is reflected in the proposal to
pay a dividend of 20% in spite of your Company's inability for the year under review to return a
suitable profit.
After closure of the accounts for the year 1998/99 completion of an exercise in re-evaluating
the land, buildings, plant and machinery owned by your Company on its premises in Bhalwal
resulted in a Revaluation Surplus of Rs. 35.128 million over and above the value shown in the
Balance Sheet.
The retiring auditors, Messrs Hameed Chaudhri & Co., Chartered Accountants, being eligible
offer themselves for re-appointment for the year 1999/2000.
The pattern of shareholding in your Company is annexed.
The Board of Directors wish to express their appreciation of the dedicated and hard work
shown by its employees during the year under review.
		for and on behalf of the Board
		MALIK MANZOOR HAYAT NOON
Lahore' 7 December, 1999.		Chairman & Chief Executive
FORM 34
PATTERN OF SHAREHOLDING
AS AT 30 JUNE, 1999
Number of	Shareholding
Shareholders	From	To	Total Shares
510	1	100	29,340
111	101	500	22,485
16	501	1,000	10,861
15	1,001	5,000	27,090
1	5,001	10,000	5,280
2	10,001	15,000	24,790
1	30,001	35,000	34,955
1	35,001	40,000	39,300
1	145,001	150,000	150,000
1	255,001	260,000	255,899
---------------------	---------------------	---------------------	---------------------
659			600,000
---------------------	---------------------	---------------------	---------------------
CATEGORIES OF SHAREHOLDERS
AS AT 30 JUNE, 1999
Categories		Number	Shares Held	Percentage
Individuals		649	394, 080	65.68
Investment Companies		2	210	0.04
Insurance Companies		2	40,560	6.76
Financial Institutions/Banks		3	161,790	26.97
Others:
Co-operative Societies		2	870	0.14
Admn. Abandoned Properties		1	2,490	0.41
		---------------------	---------------------	---------------------
TOTAL		659	600,000	100.00
		---------------------	---------------------	---------------------
AUDITORS' REPORT TO THE MEMBERS
We have audited the annexed Balance Sheet of NOON PAKISTAN LIMITED as at 30 June,
1999 and the related Profit and Loss Account and 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:
(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 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 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 30 June, 1999 and of the
loss and Cash Flows 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.
Lahore: 7 December, 1999.			HAMEED CHAUDHRI & CO.,
			CHARTERED ACCOUNTANTS
BALANCE SHEET AS AT 30 JUNE 1999
			1999	1998
		Note	Rupees	Rupees
SHARE CAPITAL AND RESERVES
Authorised capital
1,000,000 ordinary shares
of Rs. 10 each			10,000,000	10,000,000
			============	============
Issued, subscribed and
paid-up capital		3	6,000,000	6,000,000
Unappropriated profit			31,868,91 2	34,131,467
			-------------------	-------------------
			37,868,912	40,131,467
LIABILITIES AGAINST ASSETS
SUBJECT TO FINANCE LEASE		4	11,511,874	10,394,713
CURRENT LIABILITIES
Current portion of liabilities against
assets subject to finance lease		4	4,464,709	3,626,113
Short term finances		5	9,048,189	9,505,561
Creditors, accruals and other
liabilities		6	17,590,060	10,372,367
Workers' welfare fund			103,400	161,095
Provision for taxation		7	3,555,000	2,963,093
Dividends		8	1,998,966	1,871,892
			-------------------	-------------------
			36,760,324	28,500,121
CONTINGENCIES AND COMMITMENTS		9	--	--
			-------------------	-------------------
			86,141,110	79,026,301
			============	============
TANGIBLE FIXED ASSETS
Operating fixed assets		10	37,098,085	32,449,486
Capital work-in-progress		11	902,819	3,835,000
Stores held for capital expenditure			518,497	0
			-------------------	-------------------
			38,519,401	36,284,486
DEFERRED COST		12	2,625,082	1,883,157
LONG TERM LOANS		13	63,100	70,550
SECURITY DEPOSITS			532,333	118,833
CURRENT ASSETS
Stores and spares		14	10,082,039	10,911,766
Stock in trade		15	15,326,000	18,955,000
Trade debtors		16	8,051,592	1,921,446
Advances, prepayments and
other receivables		17	9,112,658	7,612,838
Cash and bank balances		18	1,828,905	1,268,225
			-------------------	-------------------
			44,401,194	40,669,275
			-------------------	-------------------
			86,141,110	79,026,301
			============	============
The annexed notes form an integral part of these accounts.
The Company's Freehold Land, Buildings on Freehold Land and Plant & Machinery have been
revalued during September, 1999. This Revaluation resulted into a Revaluation Surplus of
Rs. 35.128 million, which has not been accounted for in the above Balance Sheet.
	M. ANWAR MIR		MALIK MANZOOR HAYAT NOON
	Managing Director		Chairman & Chief Executive
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE, 1999
			1999	1998
		Note	Rupees	Rupees
SALES - Net			209,510,525	178,902,301
COST OF SALES			184,056,139	149,139,008
			-------------------	-------------------
GROSS PROFIT			25,454,386	29,763,293
ADMINISTRATIVE AND SELLING
EXPENSES		21	19,108,925	14,991,208
			-------------------	-------------------
OPERATING PROFIT			6,345,461	14,772,085
OTHER INCOME		22	119,044	571,464
			-------------------	-------------------
			6,464,505	15,343,549
OTHER CHARGES
Financial		23	4,803,011	4,560,008
Miscellaneous		24	346,500	446,467
Workers' (profit)
Participation fund			65,750	516,854
Workers' welfare fund			0	53,681
			-------------------	-------------------
			5,215,261	5,577,010
PROFIT BEFORE TAXATION			1,249,244	9,766,539
PROVISION FOR TAXATION
-- Current and prior years		7	2,311,799	3,031,777
			-------------------	-------------------
(LOSS)/PROFIT AFTER TAXATION			(1,062,555)	6,734,762
UNAPPROPRIATED PROFIT
-- Brought forward			34,134, ,467	28,896,705
			-------------------	-------------------
PROFIT AVAILABLE FOR APPROPRIATION			33,068,912	35,631,467
APPROPRIATION:
--Proposed dividend @ 20% (1998: @25%)			1,200,000	1,500,000
UNAPPROPRIATED PROFIT
-- Carried to Balance Sheet			31,868,912	34,131,467
			============	============
EARNINGS PER SHARE		25	(1.77)	11.22
			============	============
The annexed notes form an integral part of these accounts.
M. ANWAR MIR		MALIK MANZOOR HAYAT NOON
Managing Director		Chairman & Chief Executive
CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE, 1999
			1999	1998
			Rupees	Rupees
CASH INFLOW FROM OPERATING
ACTIVITIES (Note 'A')			13,888,003	8,757,017
CASH FLOW FROM INVESTING ACTIVITIES
Fixed capital expenditure			(1,071,409)	(3,746,608)
Sale proceed of vehicles			215,000	378,000
Deferred cost incurred			(1,849,292)	(2,108,700)
Long term loans to employees-Net			(3,750)	11,658
Security deposits			(413,500)	(165)
			---------------------	---------------------
CASH OUTFLOW FROM INVESTING ACTIVITIES			(3,122,951)	(5,465,815)
CASH FLOW FROM FINANCING ACTIVITIES
Finances obtained under sale and
lease back arrangements			0	2,185,000
Lease rentals paid			(6,885,865)	(7,462,352)
Security deposits against assets
acquired on finance lease			(174,613)	(454,900)
Short term finances - Net			(457,372)	2,227,794
Finance charges paid on short term finances			(1,613,596)	(1,272,503)
Dividend paid			(1,072,926)	(2,774)
			---------------------	---------------------
CASH OUTFLOW FROM FINANCING ACTIVITIES			(10,204,372)	(4,779,735)
NET INCREASE/(DECREASE) IN CASH
AND CASH EQUIVALENTS			560,680	(1,488,533)
CASH AND CASH EQUIVALENTS
- At the beginning of the year			1,268,225	2,756,758
			---------------------	---------------------
CASH AND CASH EQUIVALENTS
- At the end of the year			1,828,905	1,268,225
			============	============
NOTE 'A'
CASH FLOW FROM OPERATING ACTIVITIES
Profit for the year - Before taxation			1,249,244	9,766,539
Adjustments for'
Depreciation			4,934,511	4,351,669
Gain on sale of vehicles			(67,904)	(115,223)
Gain on sale and lease-back arrangements			0	(9,250)
Finance charges on lease finances
and short term finances			4,40.1,135	4,332,755
Deferred cost amortised			1,107,367	496,640
			---------------------	---------------------
CASH INFLOW FROM OPERATING ACTIVITIES
- Before working capital changes			11,624,353	18,823,130
(Increase)/Decrease in current assets
Stores and spares			829,727	(449,844)
Stock-in-trade			3,629,000	(5,738,000)
Trade debtors			(6,130,146)	19,383
Advances, prepayments
and other receivables			(1,010,354)	(91,177)
Increase/(Decrease) in current liabilities
Creditors, accruals and other
liabilities			7,201,276	2,477,388
Workers' welfare fund			(57,695)	76,124
			---------------------	---------------------
			4,461,808	(3,706,126)
			---------------------	---------------------
CASH INFLOW FROM OPERATING ACTIVITIES
- Before taxation			16,086,161	15,117,004
Taxes paid			(2,198,158)	(6,359,987)
			---------------------	---------------------
CASH INFLOW FROM OPERATING ACTIVITIES
- After taxation			13,888,003	8,757,017
			============	============
M. ANWAR MIR		MALIK MANZOOR HAYAT NOON
Managing Director		Chairman & Chief Executive
The annexed note 'A' forms an integral part of this Statement.
M. ANWAR MIR			MALIK MANZOOR HAYAT NOON
Managing Director			Chairman & Chief Executive
NOTES TO THE ACCOUNTS
FOR THE YEAR ENDED 30 JUNE, 1999
1. STATUS AND NATURE OF BUSINESS
The Company was incorporated in Pakistan on 26 September, 1966 as a Public
Company and its shares are quoted on Karachi and Lahore Stock Exchanges. It is
principally engaged in manufacture and sale of dairy and its allied products.
1.1 Compliance with International Accounting Standards (IASs)
These accounts comply with lASs, where applicable, in all material respects.
2. SIGNIFICANT ACCOUNTING POLICIES
2.1 Accounting convention
These accounts have been prepared under the historical cost convention modified
by capitalisation of exchange rate fluctuations in prior years as referred to in note
2.4.<