| Plastobag 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 |
|
| Directors'
Report |
|
| Pattern
of Shareholding |
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| Auditors'
Report |
|
| Balance Sheet |
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|
| Profit
& Loss Account |
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| Statement
of Changes in Financial Position |
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| Notes
to the Accounts |
|
|
|
| COMPANY
INFORMATION |
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|
| BOARD
OF DIRECTORS: |
Mr. Hussain Jamil |
Chief Executive |
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|
Mr. Ahsan Jamil |
Deputy Managing Director |
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|
Mr. Ali Jamil |
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|
Mr. Shahid Jamil |
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|
Mrs. Deborah Jamil |
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|
Mrs. Ayesha Khan |
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|
Mr. Ashiq Hussain |
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| COMPANY
SECRETARY: |
Mr. Habib Ur Rehman
Siddiqui |
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|
ACMA |
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| BANKERS: |
|
Askari Commercial Bank
Ltd. |
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|
Prime Commercial Bank
Ltd. |
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|
Muslim Commercial Bank
Ltd. |
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|
The Bank of Khyber |
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|
Emirates Bank
International |
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| AUDITORS: |
|
Rahim Iqbal Rafiq &
Company, |
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|
Chartered Accountants |
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| LEGAL
ADVISORS: |
Muneer A. Malik &
Company. |
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|
Advocates |
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| FACTORY: |
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1. Plot No. 112, Phase 5,
Industrial Estate Hattar, District Haripur, |
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|
N.W.F.P. Te1:(0995)
617682-3 Fax: (0995) 617074 |
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E-mail:
pblhatar@tx.micro.net.pk |
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2. F- 248, SITE, Karachi |
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|
Tel: (021)
2564680-2569435 Fax: (021) 2569436 |
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E-mail:
plastobag@cyber.net.pk. |
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| REGISTERED
OFFICE: |
Riaz Arcade, 13-A, (111) |
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|
Suit No. 5 & 6, 2nd
Floor, F-7 Markaz, |
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Jinnah Super Market,
Islamabad. |
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Tel: (051) 2650847 |
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Fax: (051) 2650060 |
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E-mail:
jami163@isb.comsats.net.pk |
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| CORPORATE
OFFICE: |
603 Mohammadi House, |
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|
I.I. Chundrigar Road,
Karachi-74000. |
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Tel: (021) 2423041-
2425849 |
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Fax: (021) 2418270 |
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E-mail:
plast@paknet3.ptc.pk |
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| NOTICE
OF ANNUAL GENERAL MEETING |
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| Notice
is hereby given that the 8th Annual General Meeting of the shareholders of
PLASTOBAG LIMITED |
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| will
be held at Hotel Crown Plaza, 99-E Jinnah Avenue, Blue Area, Islamabad on
Thursday December |
|
| 30,1999
at 10:00 a.m. to transact the following business: |
|
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| Ordinary
Business: |
|
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| 1.
To confirm the minutes of 7th Annual General Meeting held on December 18,
1998. |
|
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| 2.
To receive and adopt the Audited Accounts for the year ended June 30, 1999
together with Directors' |
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| &
Auditors' report. |
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|
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| 3.
To appoint auditors & fix their remuneration. The present auditors M/s.
Rahim Iqbal Rafiq & Co. |
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| retire
and being eligible offer themselves for re-appointment. |
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| Special
Business |
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| 4.
To consider and if thought fit to pass the following resolution regarding
increase in remuneration |
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| of
Deputy Managing Director of the Company. |
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|
|
|
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| "Resolved
that the remuneration of the Deputy Managing Director be increased from |
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| Rs.
102,500/- to Rs. 117,875/- per month with effect from 1st November,
1999". |
|
|
| 5.
To consider and if thought fit to pass the following resolutions, as special
resolutions: |
|
|
| "Resolved: |
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|
|
|
|
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| (a)
That a sum of Rs. 4,098,690 out of the free reserves of the Company for the
year ended June |
|
| 30,
1999 be capitalised and applied for issue of 409,869 ordinary shares of Rs.
10/- each |
|
| allotted
as fully paid Bonus Shares to the members of the Company whose names appear
on |
|
| the
register of members as at close of business on December 21, 1999 in the
proportion of |
|
| 0.90
new share for every 10 shares held. |
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|
|
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| (b)
That the Bonus shares so allotted shall rank pari passu in all respects with
the existing shares |
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| except
that they shall not qualify for the dividend declared for the year ended June
30, 1999. |
|
|
| (c)
That the members entitled to a fraction of a share shall be given sale
proceeds of their fractional |
|
| entitlement
for which purpose the fractions shall be consolidated into whole shares and
sold |
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| in
the stock market. |
|
|
| (d)
That the Secretary of the Company be authorised and empowered to give effect
to this |
|
| resolution
and to do or cause to be done all acts, deeds and things that may be
necessary or |
|
| required
.for issue, allotment and distribution of Bonus shares. In the case of
non-resident |
|
| shareholders
the Secretary is further authorised to issue/export the Bonus shares after
fulfilling |
|
| the
statutory requirements." |
|
|
|
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| 6.
To pass the following special resolutions: |
|
| "Resolved
that subject to completion of the legal formalities, the registered office of
the |
|
| Company
be shifted from "Islamabad Capital Territory" to Province of
"Sindh". |
|
|
| "Further
resolved that Memorandum and Article of Association of the Company be amended |
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| and
the Company Secretary be authorised and empowered to give effect to this
resolution." |
|
|
| 7.
To consider and if thought fit to pass the following resolutions: |
|
| "Resolved
that the Authorised Capital of the Company be increased from Rs. 50 million
to Rs. |
|
| 100.00 million". |
|
|
| "Further
resolved that the Memorandum and Article of Association of the Company be
amended |
|
| and
the Company Secretary be authorised and empowered to give effect to this
resolution." |
|
|
| 8.
To consider any other business with the permission of the Chairman. |
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|
By order of the Board |
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|
H.R. Siddiqui |
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| Karachi:
8th December, 1999 |
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|
Company Secretary |
|
|
| NOTE: |
|
|
| 1.
The Share Transfer books of the Company will remain closed from December 21
to December |
|
| 30,
1999. (both days inclusive). |
|
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|
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| A
member of the Company entitled to attend and vote in the meeting may appoint
another member |
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| of
the Company as his/her proxy. Proxy/proxies in order to be effective must be
received by the |
|
| Company
less than 48 hours before the meeting. |
|
|
| 3.
Shareholders are requested to notify any change in their addresses
immediately. |
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| STATEMENT
UNDER SECTION 160(1)(b) OF THE COMPANIES ORDINANCE, 1984 |
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|
| 1.
Issue of Bonus Shares |
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| The
Directors are of the view that Company's financial position and its reserves
justify the |
|
| capitalisation
of free reserves amounting to Rs. 4,098,960/- for the issue of bonus shares
in the |
|
| ratio
of 0.90 bonus share for every ten ordinary shares held. The Directors of the
Company, |
|
| directly
or indirectly, are not personally interested in this issue except to the
extent of their |
|
| shareholding
in the Company. |
|
|
| 2.
Increase in Authorised Capital |
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| After
capitalisation of free reserves of Rs. 4.098 million, for issue of bonus
shares, the Company's |
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| Issued
Capital will be Rs. 49.639 million. This will leave a very small margin
between the Company's |
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| issued
and Authorised Capital which at present is Rs. 50 million. To enhance this
margin to a |
|
| comfortable
level it is proposed to increase the Authorised Capital to Rs. 100 million. |
|
|
| 3.
Increase in Remuneration of the Deputy Managing Director: |
|
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| The
shareholders approval will be sought for increase in the remuneration of the
Deputy Managing |
|
| Director
in accordance with the terms. and conditions of service with the company and
on account |
|
| of
his transfer to Karachi. The Board of Directors of the Company in their
meeting held on 2nd |
|
| December,
1999 have approved the monthly remuneration of Deputy Managing Director of
the |
|
| Company,
as under, effective 1st November, 1999. |
|
|
|
|
Rs. |
|
| (a) Salary |
|
|
| Basic Salary |
|
|
76,048 |
|
| House
Rent Allowance |
|
34,222 |
|
| Utilities
Allowance |
|
7,605 |
|
|
|
|
------------------ |
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| Total |
|
|
117,875 |
|
|
|
|
========== |
|
|
|
|
| (b)
Other benefits |
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| Domestic
Servants |
Company paid servants. |
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| Telephone |
|
Actual bills upto maximum
of Rs. 15,000/- per month. |
|
| Medical |
|
Reimbursement of self and
dependent family against |
|
|
|
actual medical bills upto
a maximum of one month's |
|
|
|
gross salary per annum. |
|
| Transport |
|
Use of Company maintained
car. |
|
|
| 4.
Shifting of Head Office: |
|
|
|
| As
the Company has set-up a new plant at Karachi, for effective control and cost
reduction, the |
|
| Board
plans to shift the Company's head office from Islamabad Capital Territory to
the Province of |
|
| Sindh. |
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|
|
|
|
| DIRECTORS'
REPORT |
|
|
| The
board of directors of Plastobag Limited is pleased to present the 8th Annual
Report and Audited |
|
| Accounts
for the year ended 30th June, 1999: |
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|
| SALES
AND PRODUCTION: |
|
|
| The
Company's performance improved and it's business grew on almost all fronts
compared to the |
|
| previous
year. A year on year comparison of key indicators for the 12 months ending
30th June, 1998 & |
|
| 1999
reflects the following results for 1999: |
|
|
| (a)
Production of bottles increased by 18 percent. |
|
| (b)
Sales of PET bottles increased by 9.52 percent. |
|
| (c)
Sales turnover increased from Rs. 131.09 million to Rs.143.99 million i.e. an
increase of 9.84 |
|
| percent. |
|
|
| Despite
great uncertainty and sharp devaluations in the value of the Pak. Rupee
against the U.S. Dollar |
|
| after
the freezing of the foreign currency accounts in May, 1998, which resulted in
considerable increases |
|
| in
costs, your Company managed it's affairs fairly well, and posted a profit. By
virtue of cost-efficient |
|
| purchases
of major raw-materials, effective inventory controls for both raw-materials
and finished goods |
|
| and
by diligent reduction of wastages and production down-time at the production
floor level, the Company |
|
| was
able to considerably off-set the negative impact of the inflationary cost
increases during the period |
|
| under
review. With regard to sales, the performance for the first half of the
fiscal year ending 31st |
|
| December,
1998 showed a dramatic improvement over the previous corresponding 6-months,
such that |
|
| the
Company was able to post an operating profit for the first time since its
inception for the off-season |
|
| first
6-months of the fiscal year. While our expectations were high to carry this
unusual sales momentum |
|
| during
the winter off-season into the peak summer season of high beverage sales, the
last quarter |
|
| ending
June, 1999 was disappointing. This was because beverage bottling plants found
themselves to |
|
| be
short of filling capacity and concentrated on the more profitable returnable
glass packages to the |
|
| detriment
of the PET package. Although the summer of 1999 was a good one for beverage
sales generally, |
|
| PET
bottle sales declined suddenly thus adversely affecting the Company's
profitability which could |
|
| have
ended on an even more robust note for the year. A redeeming feature of this
set-back is that many |
|
| of
our clients have undertaken significant capacity expansion which bodes well
for the PET package |
|
| future. |
|
|
| FINANCIAL
RESULTS: |
|
| Your
Company ended the financial year with a profit of Rs.17.005 million while the
net reserves and |
|
| accumulated
profit increased to Rs.28.190 million. |
|
|
| It
is on the strength' of the distinctly improved financial health of the
Company that the management has |
|
| been
able to set-up the new bottle manufacturing unit in Karachi in order to meet
the growing demand in |
|
| the
southern region cost effectively. |
|
|
| FUTURE
OUTLOOK: |
|
| In
view of the strong growth in demand for PET bottles arising from their
increased applications replacing |
|
| tin
containers and glass bottles alongwith enhanced consumption levels, your
Company's management |
|
| has
implemented a bottle blowing plant in Karachi. With the advent of the Karachi
Plant which is presently |
|
| under
trial-production, the Company is expected to substantially increase
production output and sales |
|
| especially
during the peak summer sales season when it is faced ,with acute
under-capacity in relation |
|
| to
demand. The target date for commercial production at the Karachi plant is 1st
January, 2000. |
|
|
| Although
new competitors producing PET bottles have entered the market during
mid-1999, your |
|
| Company's
cost effective expansion of production capacity in the face of substantial
growth in the |
|
| beverage
industry following the enhancement in their filling-plant capacities, augurs
extremely well for |
|
| the
Company. Being the most experienced, tried and tested suppliers of bottles to
the carbonated soft- |
|
| drink
industry, having manufacturing units strategically located in both the north
(Hattar) and south |
|
| (Karachi)
of Pakistan, we expect to take a major share of the increase in the
non-returnable PET bottles |
|
| segment
which is clearly becoming the engine of growth for beverages. |
|
|
| RISKS: |
|
| A
cause of concern other than the gradual increase in PET resin prices in the
last 4-6 months is the |
|
| apprehension
of the general slow-down in the economy due to recession and the looming
devaluation |
|
| of
the Pak. Rupee against hard currencies, which could easily impact the cost of
our products adversely. |
|
|
| MANAGEMENT
RELATIONS: |
|
| The
Company's finance and technical team of managers have picked up valuable
experience in the last |
|
| 7
years due to inter-facing with foreign .experts in this field and through
regular attendance of locally |
|
| offered
management courses in their respective areas. |
|
|
| The
Company has taken necessary steps to become Y2K compliant by engaging the
services and |
|
| expertise
of a reputed consultancy firm and is confident of adequately meeting the
challenges of the |
|
| new millennium. |
|
|
| AUDITORS: |
|
| The
present auditors of the Company M/s. Rahim Iqbal Rafiq & CO., have
retired and being eligible offer |
|
| themselves
for reappointment for the year 1999-2000. |
|
|
|
|
For and on behalf of board of |
|
|
|
directors |
|
|
|
|
|
|
|
|
|
HUSSAIN JAMIL |
|
| Karachi:
2nd December, 1999 |
|
Chief Executive |
|
|
|
| PATTERN
OF SHAREHOLDING |
|
| AS
AT JUNE 30, 1999 (FORM 34) |
|
|
| SERIAL |
NO. OF |
SHARE-HOLDING |
TOTAL |
|
|
| NUMBER |
SHARE |
|
SHARES |
|
|
|
HOLDERS |
FROM |
TO |
HELD |
|
|
|
| 1 |
38 |
1 |
100 |
3,800 |
|
| 2 |
2,096 |
101 |
500 |
1,032,500 |
|
| 3 |
40 |
501 |
1,000 |
39,800 |
|
| 4 |
47 |
1,001 |
5,000 |
142,000 |
|
| 5 |
9 |
5,001 |
10,000 |
59,500 |
|
| 6 |
5 |
10,001 |
15,000 |
65,200 |
|
| 7 |
2 |
15,001 |
20,000 |
40,000 |
|
| 8 |
7 |
20,001 |
25,000 |
149,100 |
|
| 9 |
1 |
30,001 |
35,000 |
33,500 |
|
| 10 |
1 |
45,000 |
50,000 |
45,600 |
|
| 11 |
1 |
60,001 |
65,000 |
63,000 |
|
| 12 |
1 |
75,001 |
80,000 |
80,000 |
|
| 13 |
1 |
80,001 |
85,000 |
84,000 |
|
| 14 |
2 |
95,001 |
100,000 |
200,000 |
|
| 15 |
1 |
110,001 |
115,000 |
114,340 |
|
| 16 |
1 |
120,001 |
125,000 |
121,100 |
|
| 17 |
1 |
150,001 |
155,000 |
151,000 |
|
| 18 |
1 |
155,001 |
160,000 |
157,000 |
|
| 19 |
1 |
160,001 |
165,000 |
160,700 |
|
| 20 |
1 |
175,001 |
180,000 |
178,680 |
|
| 21 |
1 |
215,001 |
220,000 |
215,500 |
|
| 22 |
1 |
225,001 |
230,000 |
228,680 |
|
| 23 |
1 |
495,001 |
500,000 |
498,060 |
|
| 24 |
1 |
690,001 |
695,000 |
691,040 |
|
|
------------------ |
|
------------------ |
|
|
2,261 |
|
4,554,100 |
|
|
========== |
|
========== |
|
|
|
|
|
|
| NOTE:
The slabs not applicable have not been shown. |
|
|
| Categories
of Shareholders |
|
No. of |
Shares Held |
Percentage |
|
|
Shareholders |
|
| Individuals |
|
2,255 |
4,255,900 |
93.43 |
|
| Joint
Stock Companies |
|
2 |
12,200 |
0.27 |
|
| Financial
Institutions |
|
1 |
21,700 |
0.48 |
|
| Investment
Companies |
|
3 |
265,200 |
5.82 |
|
|
|
------------------ |
------------------ |
------------------ |
|
|
2,261 |
4,554,100 |
100.00 |
|
|
========== |
========== |
========== |
|
|
| AUDITORS'
REPORT TO THE MEMBERS |
|
|
| We
have audited the annexed Balance Sheet of PLASTOBAG LIMITED as at June 30,
1999 and the |
|
| related
profit and loss account and statement of changes in financial position,
together with the notes |
|
| forming
part thereof, for the year then ended and we state that we have obtained all
the information and |
|
| explanation
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 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 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, investment 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 and profit and loss account and the statement of changes in
financial position, |
|
| 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
and deposited by the Company in the Central Zakat Fund established under
Section |
|
| 7
of the Ordinance. |
|
|
|
|
|
|
|
| Karachi: |
|
|
RAHIM IQBAL RAFIQ AND CO. |
|
| Dated:
3rd December, 1999. |
|
Chartered Accountants. |
|
|
|
| BALANCE
SHEET AS AT JUNE 30, 1999 |
|
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
|
|
| SHARE
CAPITAL |
|
|
|
| AUTHORISED |
|
|
|
| 5,000,000
(1998: 5,000,000) |
|
|
|
| Ordinary
Shares of Rs. 10/- each |
|
|
50,000,000 |
50,000,000 |
|
|
|
|
========== |
========== |
|
|
|
|
|
|
| Issued,
subscribed and paid-up: |
|
3 |
45,541,000 |
45,541,000 |
|
| Reserve
for issue of Bonus Shares |
|
|
4,098,690 |
-- |
|
| Unappropriated
profit |
|
|
28,190,790 |
15,284,281 |
|
|
|
|
------------------ |
------------------ |
|
|
|
4 |
77,830,480 |
60,825,281 |
|
| SURPLUS
ON REVALUATION OF FIXED ASSETS |
5 |
92,519,760 |
92,519,760 |
|
| REDEEMABLE
CAPITAL |
|
6 |
35,954,981 |
40,403,887 |
|
| LONG
TERM LOANS |
|
7 |
-- |
1,701,000 |
|
| LIABILITY
AGAINST ASSETS SUBJECT |
|
|
|
| TO
FINANCE LEASE |
|
8 |
17,240,020 |
128,556 |
|
|
|
|
|
| CURRENT
LIABILITIES |
|
|
|
|
| Current
portion of long term liabilities |
|
9 |
9,815,139 |
5,887,839 |
|
| Short
term finances |
|
10 |
14,797,661 |
4,517,519 |
|
| Creditors,
accrued and other liabilities |
|
11 |
30,516,028 |
28,248,705 |
|
| Unclaimed
Dividend |
|
|
295,984 |
-- |
|
| Proposed
Dividend |
|
|
-- |
4,554,100 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
55,424,812 |
43,208,163 |
|
| CONTINGENCIES
AND COMMITMENTS |
|
12 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
278,970,053 |
238,786,647 |
|
|
|
|
========== |
========== |
|
|
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
|
|
| FIXED
CAPITAL EXPENDITURE |
|
|
| Operating
fixed assets |
|
13 |
180,379,666 |
187,771,038 |
|
| Capital
work-in-progress |
|
14 |
21,343,273 |
-- |
|
| Un-allocated
capital expenditure |
|
15 |
3,527,535 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
205,250,474 |
187,771,038 |
|
|
|
|
| LONG
TERM SECURITY DEPOSITS |
|
16 |
4,017,633 |
692,740 |
|
|
|
|
|
| DEFERRED
COSTS |
|
17 |
-- |
408,590 |
|
|
|
|
|
| CURRENT
ASSETS |
|
|
|
| Spares
and loose tools |
|
18 |
15,568,272 |
11,347,330 |
|
| Stock-in-trade |
|
19 |
30,147,343 |
21,561,235 |
|
| Trade
debts - unsecured considered good |
|
|
12,537,357 |
8,228,818 |
|
| Advances,
prepayments and other receivables |
|
20 |
7,184,622 |
6,209,364 |
|
| Cash
and bank balances |
|
21 |
4,264,352 |
2,567,532 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
69,701,946 |
49,914,279 |
|
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
278,970,053 |
238,786,647 |
|
|
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of financial statements. |
|
|
|
HUSSAIN JAMIL |
|
|
AHSAN JAMIL |
|
|
Chief Executive |
|
|
Deputy Managing Director |
|
|
|
| PROFIT
AND LOSS ACCOUNT |
|
| FOR
THE YEAR ENDED JUNE 30, 1999 |
|
|
|
|
|
1999 |
1998 |
|
|
NOTE |
RUPEES |
RUPEES |
|
|
|
|
| SALES |
|
|
|
143,991,033 |
131,088,122 |
|
|
|
|
|
| COST
OF GOODS SOLD |
|
22 |
(95,577,791) |
(99,698,447) |
|
|
|
|
------------------ |
------------------ |
|
| GROSS
PROFIT |
|
|
48,413,242 |
31,389,675 |
|
|
|
|
|
|
|
| OPERATING
EXPENSES |
|
|
|
|
| Administration |
|
23 |
8,854,704 |
7,607,665 |
|
| Selling
& Distribution |
|
24 |
7,548,926 |
6,143,081 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
16,403,630 |
13,750,746 |
|
|
|
|
|
------------------ |
------------------ |
|
| OPERATING
PROFIT |
|
|
32,009,612 |
17,638,929 |
|
| OTHER
INCOME / (EXPENSES) |
