Lucky Cement Limited Annual Report – Financial Statements Analysis
Cement Industry of Pakistan
Since the report is Spreadsheet based, for better formatting, below report can be downloaded in XLS [MS Excel] format here.
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Lucky Cement Limited |
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| Annual Report 1999 | |||||||||
| CONTENTS | |||||||||
| Company Information | |||||||||
| Notice of Meeting | |||||||||
| Directors’ Report | |||||||||
| Au
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| lance Sheet | |||||||||
| Profit & Loss Account | |||||||||
| Statement of Changes in Financial Position (Cash Flow) | |||||||||
| Notes to the Accounts | |||||||||
| Statement and Report under Section 237 of the Companies Ordinance, 1984 | |||||||||
| Lucky Powertech Limited | |||||||||
| Consolidated Accounts | |||||||||
| Pattern of Shareholding | |||||||||
| COMPANY INFORMATION | |||||||||
| BOARD OF DIRECTORS | |||||||||
| Abdul Razzak Tabba (Chairman/Chief Executive) | |||||||||
| Muhammad Yunus Tabba | |||||||||
| Samir Ahmed | |||||||||
| Haji Abdul Razzak | |||||||||
| Martyn S. Wells | |||||||||
| Muhammad Sohail Tabba | |||||||||
| Muhammad Ali Tabba | |||||||||
| Imran Yunus Tabba | |||||||||
| EXECUTIVE DIRECTOR | |||||||||
| Abdur Razzaq Thaplawala | |||||||||
| COMPANY SECRETARY &SR. MANAGER FINANCE | |||||||||
| Muhammad Abid Ganatra | |||||||||
| ACA. ACMA, ACIS | |||||||||
| AUDITORS | |||||||||
| M. Yousuf Adil Saleem & Co., | |||||||||
| Chartered Accountants | |||||||||
| BANKERS | |||||||||
| Metropolitan Bank Limited | |||||||||
| Muslim Commercial Bank Limited | |||||||||
| Soneri Bank Limited | |||||||||
| REGISTERED OFFICE/FACTORY | |||||||||
| Pezu, District Lakki Marwat | |||||||||
| N . W. F. P. | |||||||||
| HEAD OFFICE | |||||||||
| 6-A Muhammad Ali Housing Society, | |||||||||
| A. Aziz Hashim Tabba Street, | |||||||||
| Karachi -75350. | |||||||||
| UAN (021) 111-786-555 | |||||||||
| SALES OFFICES | |||||||||
| 26-B, Aibak Block | Aptma House, | ||||||||
| New Garden Town, Lahore. | Jamrud Road, Peshawar. | ||||||||
| UAN (042) 111-786-555 | UAN (091) 111-786-555 | ||||||||
| Gold Crest Plaza, 20 Azmat | Saddar Bazar, Bannu Road, | ||||||||
| Wasti Road, Near Chowk | Near Main Flying Coach Adda, | ||||||||
| Dera Adda, Multan | D.I. Khan. | ||||||||
| Tel · (061 ) 540021,510021 | UAN (0961) 111-786-555 | ||||||||
| 3rd Floor, Kulsum Plaza, | |||||||||
| 42 Blue Area, Islamabad. | |||||||||
| UAN (051 ) 111-786-555 | |||||||||
| SHARES DEPARTMENT | |||||||||
| 404, 4th Floor, Trade Tower | |||||||||
| Abdullah Haroon Road, Karachi. | |||||||||
| Tel. No. 5685930-5687839 | |||||||||
| NOTICE OF 6TH ANNUAL GENERAL MEETING | |||||||||
| Notice is hereby given that the 6th Annual General Meeting of the members of Lucky Cement | |||||||||
| Limited will be held on Wednesday, the 29th December, 1999 at 12:00 noon at the registered | |||||||||
| office of the Company situated at factory premises Pezu, District Lakki Marwat, N.W.F.P. to | |||||||||
| transact the following business: | |||||||||
| 1. To confirm the minutes of 5th Annual General Meeting held on 30th December, 1998. | |||||||||
| 2. To receive, consider and adopt the audited accounts for the year ended June 30, 1999 | |||||||||
| together with the Directors’ and Auditors’ report thereon. | |||||||||
| 3. To appoint Auditors and fix their remuneration for the year 1999-2000. The present Auditors, | |||||||||
| Messrs M. Yousuf Adil Saleem & Co., Chartered Accountants, retire and being eligible, | |||||||||
| offer themselves for reappointment. | |||||||||
| 4. To transact any other business with the permission of the Chair. | |||||||||
| By order of the Board | |||||||||
| Muhammad Abid Ganatra | |||||||||
| Karachi: December 7, 1999 | Company Secretary | ||||||||
| Notes: | |||||||||
| 1. The share transfer books of the Company will be closed from 21st December, 1999 to 29th | |||||||||
| December, 1999 (both days inclusive) for the purpose of 6th Annual General Meeting. | |||||||||
| 2. A member entitled to attend and vote may appoint another member as his/her proxy to | |||||||||
| attend and vote instead of him/her. Proxies must be received at the Registered Office of | |||||||||
| the Company not less than 48 hours before the time of holding the meeting. | |||||||||
| 3. The members are requested to notify change in their address, if any, to the Company’s | |||||||||
| shares department at 404, 4th Floor, Trade Tower, Abdullah Haroon Road, Karachi. | |||||||||
| DIRECTORS’ REPORT | |||||||||
| We have pleasure to present this Sixth Annual Report of the company alongwith the annual accounts | |||||||||
| for the year ended 30th June, 1999 and auditors report thereon. | |||||||||
| Demand Situation | |||||||||
| The demand of the cement in the country showed a marginal improvement during the year under | |||||||||
| review. The despatches of cement by the industry increased by about half a million tons during the | |||||||||
| year as compared to year ended on 30th June, 1998. As explained in our report for the year 1997-98, | |||||||||
| the consumption of cement per head of population in Pakistan is one of the lowest in the world. Let | |||||||||
| us hope that present stagnation in our economy will not last longer and economic development in the | |||||||||
| country will accelerate soon. | |||||||||
| Prices and Excise Duty | |||||||||
| The prices of cement during the year were fairly stable. The Federal Government converted the | |||||||||
| excise duty leviable at 40% of retail price to a specific duty per ton in April, 1999. Prior to | |||||||||
| April, 1999, the incidence of excise duty worked out between Rs. 1,600/= to Rs. 1,800/= per ton | |||||||||
| depending upon the prevailing retail price. Under the changed basis, the excise duty is now payable | |||||||||
| at a fiat rate of Rs. 1,400/= per ton irrespective of the retail price. As a consequence of the revision | |||||||||
| in the incidence of duty the ex-factory prices of cement were reduced by about Rs. 200.00 per ton | |||||||||
| under pressure from the authorities. | |||||||||
| Increase in Costs | |||||||||
| The price of Furnace Oil was increased from Rs. 5,520/= to Rs.6,090/= per ton in May, 1999. In the | |||||||||
| current year, the price was further increased to Rs. 6,980.00 per ton with effect from 16th August, | |||||||||
| 1999 due to levy of sales tax. A recent announcement of the Government has said that the electricity | |||||||||
| supplies will also be liable to 15% sales tax with effect from 16th August, 1999. The levy of sales tax | |||||||||
| on furnace oil and electricity will have very little effect on those industries whose end products are | |||||||||
| liable to .sales tax because of tax credit on inputs available to them. The cement is not chargeable to | |||||||||
| sales tax and therefore the cement industry will not be able get any credit for sales tax paid by it on | |||||||||
| the furnace oil & electricity. This will increase the cost of production by about Rs. 150/= per ton of | |||||||||
| cement. Unless the cement manufacturers are allowed to increase their prices by corresponding | |||||||||
| amount, the industry’s financial performance will be adversely affected. On our part, your company | |||||||||
| is trying to reduce the cost of inputs by taking measures to reduce the consumption of fuel oil and | |||||||||
| electricity on the one hand and increasing the production efficiency on the other hand. | |||||||||
| It may not be out of place to remind the shareholders that your company had decided to set-up it’s | |||||||||
| cement plant in a remote area of the NWFP on the basis of Government’s promise to exempt | |||||||||
| cement produced by it from sales tax upto June, 2001. This promise was backed by appropriate | |||||||||
| notification and the Protection of Economic Reforms Act 1992. Unfortunately, under pressure of | |||||||||
| some competitors, the Government did not honour its promise and extended the exemption from | |||||||||
| sales tax to the entire industry and increased excise duty simultaneously. This was obviously meant | |||||||||
| to circumvent the law and nullify the benefit of sales tax available to your company. This was also a | |||||||||
| violation of section ‘6’ of Protection of Economic Reforms Act, 1992 which reads: | |||||||||
| “The fiscal incentives for investment provided by the government through statutory orders listed | |||||||||
| in the schedule OR OTHERWISE NOTIFIED shall continue in force for the term specified thereon | |||||||||
| and SHALL NOT BE ALTERED TO THE DISADVANTAGE OF THE INVESTORS” | |||||||||
| No wonder that this and other ill-advised measures by the Government have shaken the confidence | |||||||||
| of investing public both in Pakistan & abroad. | |||||||||
| Operating Performance | |||||||||
| The company produced 682,032 tons of clinker or 51.66% of its rated capacity based on 330 days | |||||||||
| operation. In the preceding year, the clinker production was 526,184 tons or 39.86%. If the rated | |||||||||
| capacity is calculated on the basis of 300 working days per year which is the industry standard in | |||||||||
| Pakistan, our production in 1998-99 works out to 56.84% of the rated capacity. The following are | |||||||||
| the figures of cement production & despatches during the year under review: | |||||||||
| Cement Production 691,445 Tons | |||||||||
| Cement Despatches 709,106 Tons | |||||||||
| As you will see from the attached profit & loss accounts, the company earned a gross profit of | |||||||||
| Rs. 262.6 million on a net sales of Rs. 1,474.9 million yielding a Gross Profit percentage of 17.8% | |||||||||
| against 6.56% earned in the preceding year. Because of the location of the company’s plant in a | |||||||||
| .remote area, the company’s product had to bear higher transportation cost. However, inspire of | |||||||||
| higher transportation costs, you will be pleased to know that after charging the administration, selling | |||||||||
| ,and financial expenses, the year closed with a net profit of Rs. 55.4 million against a net loss of | |||||||||
| Rs. 119.2 million in the preceding year. The carry forward loss of Rs. 145.7 million has now been | |||||||||
| reduced to Rs. 90.33 million only. It is hoped that this loss will be wiped off during the current year | |||||||||
| if there is no major changes in cost of inputs or prices of cement. | |||||||||
| Balance Sheet | |||||||||
| The company’s balance sheet is still quite robust. It’s long term loans and liabilities for financial | |||||||||
| leases amounted to Rs. 484.74 million as on 30th June, 1999 against the equity of Rs. 3,349.67 | |||||||||
| million giving a debt equity ratio of 14.5:85.5. The break-up value of the company’s Rs. 10.00 equity | |||||||||
| share improved from Rs. 13.45 per share on 30th June, 1998 to Rs. 13.67 per share on 30th June, | |||||||||
| 1999. The company continued to discharge its repayment obligations of long term loans in time. | |||||||||
| Year 2000 problems in Computer System | |||||||||
| As reported in our previous report, we have taken adequate measures to protect the company | |||||||||
| against Y2K problems. | |||||||||
| Auditors | |||||||||
| The auditors, M. Yousuf Adil Saleem & Co, Chartered Accountants, retire and being eligible offer | |||||||||
| themselves for reappointment. | |||||||||
| Pattern of Shareholding | |||||||||
| The pattern of shareholding as on 30th June, 1999 is annexed to this report. | |||||||||
| Subsidiary | |||||||||
| The audited accounts of the Lucky Powertech Limited, the company’s wholly owned subsidiary, for | |||||||||
| the year ended 30th June, 1999 are annexed to this report. | |||||||||
| Acknowledgment | |||||||||
| The directors acknowledge the appreciation for the participation of Mr. Razi-ur-Rahman Khan in | |||||||||
| the board of directors meeting during the period of his directorship. Mr. Khan has resigned from the | |||||||||
| directorship and his place Mr. Samir Ahmed has been appointed for remaining period. | |||||||||
| Your directors acknowledge with appreciation, the efforts of company’s managers, technicians and | |||||||||
| workers and the support extended by the company’s bankers, leasing companies, dealers and stockists. | |||||||||
| By order of the Board | |||||||||
| ABDUL RAZZAK TABBA | |||||||||
| Karachi: December 7, 1999 | Chairman & Chief Executive | ||||||||
| AUDITORS’ REPORT TO THE MEMBERS | |||||||||
| We have audited the annexed balance sheet of Lucky Cement Limited as at June 30, 1999 and | |||||||||
| related profit and loss account and the 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 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, 1’984; | |||||||||
| 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 and 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 and the | |||||||||
| changes in financial position for the year then ended; and | |||||||||
| d. in our opinion, no zakat was deductible at source under the Zakat and Ushr Ordinance, 1980. | |||||||||
| M. YOUSUF ADIL SALEEM & CO., | |||||||||
| Karachi: December 7, 1999 | Chartered Accountants | ||||||||
| Annual Report 1999 | |||||||||
| BALANCE SHEET AS AT JUNE 30, 1999 | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in “000” | |||||||||
| SHARE CAPITAL AND RESERVE | |||||||||
| Authorized capital | |||||||||
| 300,000,000 Ordinary shares | |||||||||
| of Rs. 10/= each | 3,000,000 | 3,000,000 | |||||||
| =========== | =========== | ||||||||
| Issued, subscribed and paid-up capital | |||||||||
| 245,000,000 Ordinary shares of Rs. 10/= each | |||||||||
| fully paid in cash | 2,450,000 | 2,450,000 | |||||||
| Capital reserve | |||||||||
| Share premium | 990,000 | 990,000 | |||||||
| Accumulated loss | (90,330) | (145,761) | |||||||
| ——————– | ——————– | ||||||||
| 3,349,670 | 3,294,239 | ||||||||
| LONG TERM LOANS | 3 | 408,718 | 517,901 | ||||||
| LIABILITIES AGAINST ASSETS SUBJECT | |||||||||
| TO FINANCE LEASE | 4 | 76,022 | 106,709 | ||||||
| DEFERRED LIABILITIES | 5 | 75,994 | 124,589 | ||||||
| LONG TERM DEPOSITS | 6 | 16,139 | 19,234 | ||||||
| CURRENT LIABILITIES | |||||||||
| Short term finance | 7 | 175,143 | 221,156 | ||||||
| Short term loan – unsecured and interest free | |||||||||
| Associated Undertaking | 45,000 | ||||||||
| Current portion of long term liabilities | 8 | 13 4,105 | 114,529 | ||||||
| Creditors, accrued and other liabilities | 9 | 238,037 | 178,603 | ||||||
| Provision for taxation | 7,00 0 | 7,000 | |||||||
| ——————– | ——————– | ||||||||
| 599,285 | 521,288 | ||||||||
| CONTINGENCIES AND COMMITMENTS | 10 | — | — | ||||||
| ——————– | ——————– | ||||||||
| 4,525,828 | 4,583,960 | ||||||||
| =========== | =========== | ||||||||
| FIXED ASSETS – TANGIBLE | |||||||||
| Operating assets | 11 | 3,779,285 | 3,886,494 | ||||||
| Capital work-in-progress | 12 | 5,5 91 | 17,805 | ||||||
| ——————– | ——————– | ||||||||
| 3,784,876 | 3,904,299 | ||||||||
| LONG TERM INVESTMENT | 13 | 200,000 | 200,000 | ||||||
| LONG TERM DEPOSITS AND | |||||||||
| DEFERRED COSTS | 14 | 42,835 | 53,663 | ||||||
| CURRENT ASSETS | |||||||||
| Stores and spares | 15 | 171,221 | 114,451 | ||||||
| S toc k- in- trade | 16 | 65,73 5 | 63,125 | ||||||
| Trade debtors – secured | 5,681 | — | |||||||
| Advances, deposits, prepayments and | |||||||||
| other receivables | 17 | 231,030 | 233,283 | ||||||
| Cash and bank balances | 18 | 24,450 | 15,139 | ||||||
| ——————– | ——————– | ||||||||
| 498,117 | 425,998 | ||||||||
| ——————– | ——————– | ||||||||
| 4,525,828 | 4,583,960 | ||||||||
| =========== | =========== | ||||||||
| The annexed notes from 1 to 33 form an integral part of these accounts. | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| PROFIT AND LOSS ACCOUNT | |||||||||
| FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in “000” | |||||||||
| Sales – net | 19 | 1,474,964 | 1,010,006 | ||||||
| Cost of sales | 20 | 1,212,348 | 943,705 | ||||||
| ——————– | ——————– | ||||||||
| Gross profit | 262,616 | 66,301 | |||||||
| Operating expenses | |||||||||
| Administrative | 21 | 37,767 | 46,779 | ||||||
| Selling and distribution | 22 | 14,332 | 10,551 | ||||||
| ——————– | ——————– | ||||||||
| 52,099 | 57,330 | ||||||||
| ——————– | ——————– | ||||||||
| Operating profit | 210,517 | 8,971 | |||||||
| Other income | 23 | 626 | 629 | ||||||
| ——————– | ——————– | ||||||||
| 211,143 | 9,600 | ||||||||
| ——————– | ——————– | ||||||||
| Financial charges | 24 | 152,795 | 123,781 | ||||||
| Workers’ profit participation fund | 2,917 | 0 | |||||||
| ——————– | ——————– | ||||||||
| 155,712 | 123,781 | ||||||||
| ——————– | ——————– | ||||||||
| Profit/(loss) before taxation | 55,431 | -114,181 | |||||||
| Provision for taxation | 0 | (5,000) | |||||||
| ——————– | ——————– | ||||||||
| Net profit / (loss) after taxation | 55,431 | -109,181 | |||||||
| Accumulated loss brought forward | -145,761 | (26,580) | |||||||
| ——————– | ——————– | ||||||||
| Accumulated loss carried forward | -90,330 | -135,761 | |||||||
| =========== | =========== | ||||||||
| Earning per share | 29 | Rs.0.22 | Rs..23 | ||||||
| The annexed notes from 1 to 33 form an integral part of these accounts | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| STATEMENT OF CHANGES IN FINANCIAL POSITION | |||||||||
| (CASH FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| A. CASH FROM OPERATING ACTIVITIES | |||||||||
| Profit / (loss) before taxation | 55,431 | (114,181) | |||||||
| Adjustments for: | |||||||||
| Depreciation | 157,453 | 135,523 | |||||||
| Amortization of deferred cost | 11,838 | 11,636 | |||||||
| Gain / (loss) on disposal of fixed assets | 24 | (232) | |||||||
| Provision for gratuity | 1,965 | 2,304 | |||||||
| Payment for gratuity | (345) | — | |||||||
| Financial charges | 152,795 | 123,781 | |||||||
| ——————– | ——————– | ||||||||
| Profit before working capital changes | 379,161 | 158,831 | |||||||
| Working capital changes | |||||||||
| Increase / (Decrease) in current assets | |||||||||
| Stores and spares | (56,770) | 17,364 | |||||||
| Stock in trade | (2610) | (28,847) | |||||||
| Trade debtors | (5,681) | 37 | |||||||
| Advances, deposits, prepayments | |||||||||
| and other receivables | 2,253 | (78,563) | |||||||
| Increase / (Decrease) in current liabilities | |||||||||
| Creditors, accrued and other liabilities | 8,656 | 45,111 | |||||||
| ——————– | ——————– | ||||||||
| Cash generated from operation | 325,009 | 113,933 | |||||||
| Financial charges paid | (122,9 84) | (160,535) | |||||||
| ——————– | ——————– | ||||||||
| Net cash from / (used in) operating activities | 202,025 | (46,605) | |||||||
| ——————– | ——————– | ||||||||
| B. CASH FROM INVESTING ACTIVITIES | |||||||||
| Fixed capital expenditure | (38,093) | (173,387) | |||||||
| Sales proceed of fixed assets | 3 8 | 35,885 | |||||||
| Long term deposits | — | (1,750) | |||||||
| Deferred costs | (1,010) | (122) | |||||||
| ——————– | ——————– | ||||||||
| Net cash used in investing activities | (39,065) | (139,374) | |||||||
| ——————– | ——————– | ||||||||
| C. CASH FROM FINANCING ACTIVITIES | |||||||||
| Long term loan paid | (64,060) | (12,500) | |||||||
| Lease finance obtained | — | 35,000 | |||||||
| Lease finance paid | (15,744) | (446) | |||||||
| Deferred liabilities | (24,738) | 53,578 | |||||||
| Long term deposits | (3,095) | (5,533) | |||||||
| ——————– | ——————– | ||||||||
| Net cash from investing activities | (107,636) | 70,099 | |||||||
| ——————– | ——————– | ||||||||
| Net decrease in cash and cash equivalents (A+B+C) | 55,324 | (115,880) | |||||||
| Cash and cash equivalent at the beginning of the year | (206,017) | (90,137) | |||||||
| ——————– | ——————– | ||||||||
| Cash and cash equivalent at the end of the year | 150,693 | (206,017) | |||||||
| =========== | =========== | ||||||||
| Cash and cash equivalent | |||||||||
| Cash and bank balances | 24,450 | 15,139 | |||||||
| Short term finance | (175,143) | (221,156) | |||||||
| ——————– | ——————– | ||||||||
| 150,693 | 206,017 | ||||||||
| =========== | =========== | ||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| NOTES TO THE ACCOUNTS | |||||||||
| FOR THE YEAR ENDED JUNE 30,1999 | |||||||||
| 1. THE COMPANY AND ITS OPERATION | |||||||||
| Lucky Cement Limited was incorporated in Pakistan on September 18, 1993 under the Companies | |||||||||
| Ordinance, 1984. The shares of the Company are quoted on the Stock Exchanges of Pakistan. | |||||||||
| The principal activity of the Company is manufacture and sale of Cement. The project is located | |||||||||
| at District Lakki Marwar in North West Frontier Province. | |||||||||
| 2. SIGNIFICANT ACCOUNTING POLICIES | |||||||||
| 2.1 Accounting convention | |||||||||
| These accounts have been prepared under the ‘historical cost convention’. | |||||||||
| 2.2 Staff retirement benefit | |||||||||
| The Company operates an unfunded gratuity scheme for all its employees. Annual provisions | |||||||||
| are made in the accounts to cover this liability. | |||||||||
| 2.3 Taxation | |||||||||
| Current | |||||||||
| Provision for current taxation is based on current rates of tax after taking into account tax | |||||||||
| rebates and credits available, if any. | |||||||||
| Deferred | |||||||||
| The Company accounts for deferred tax on all material timing differences using the liability | |||||||||
| method. However, deferred tax is not provided if it can be established with reasonable | |||||||||
| certainty that these timing differences will not reverse in the foreseeable future. | |||||||||
| 2.4 Fixed assets and depreciation | |||||||||
| Operating assets | |||||||||
| These are stated at cost less accumulated depreciation except free hold land which is | |||||||||
| stated at cost. | |||||||||
| Depreciation is charged to income applying the straight line method on building and quarry | |||||||||
| equipment and on written down value on all other assets at the rates mentioned in the | |||||||||
| relevant note. On plant and machinery depreciation is charged on units of production | |||||||||
| method based on higher of estimated life and production. Full year’s depreciation is charged | |||||||||
| on additions while no depreciation is charge on assets deleted during the year. However, | |||||||||
| capitalization of project cost is depreciated proportionately for the period of use. Upto the | |||||||||
| year. 1997-98 depreciation on Vehicle, Furniture and Fixture, Office equipment and other | |||||||||
| assets was recorded on straight line method. Due to this change, depreciation for the year | |||||||||
| has been reduced by Rs. 3.5 million. | |||||||||
| Maintenance and normal repairs are charged to income as and when incurred. Major | |||||||||
| renewals and improvements are capitalized. | |||||||||
| Gains and losses on disposal of assets, if any, are included in income currently. | |||||||||
| Assets subject to finance lease | |||||||||
| Assets subject to finance lease are stated at the lower of present value of minimum lease | |||||||||
| payments under the lease agreements and fair value of the assets. The related obligations | |||||||||
| of the lease are accounted for as liabilities. Assets acquired under the finance leases are | |||||||||
| depreciated at the rates specified in relevant note. | |||||||||
| 2.5 Capital work in progress | |||||||||
| All cost/expenditure directly related to specific assets incurred during project implementation | |||||||||
| period are carried under this head. These are transferred to specific assets as and when | |||||||||
| assets are available for use. | |||||||||
| 2.6 Deferred Costs | |||||||||
| Deferred cost is amortized over a maximum period of five years beginning from the year | |||||||||
| of deferment. | |||||||||
| 2.7 Investments | |||||||||
| Long term investments are stated at cost. Provision is made for permanent diminution in | |||||||||
| value. | |||||||||
| 2.8 Stores and spares | |||||||||
| These are valued at moving average cost. Items in transit are stated at cost accumulated | |||||||||
| upto the balance sheet date. | |||||||||
| 2.9 Stock in trade | |||||||||
| These are valued at lower of cost or net realizable value. Cost signifies in relation to raw | |||||||||
| and packing material at average cost. In case of work in process and finished goods at | |||||||||
| average cost comprising prime cost and appropriate manufacturing overheads. | |||||||||
| 2.10 Foreign Currency Transactions | |||||||||
| Assets and liabilities in foreign currencies are translated into Pak Rupees at the rates of | |||||||||
| exchange prevailing at the balance sheet date, except those covered under the forward | |||||||||
| exchange contracts which are translated at cover rate. Exchange gains and losses on | |||||||||
| translation are included in income currently. | |||||||||
| 2.11 Revenue Recognition | |||||||||
| Sales are recorded on despatch of goods to customers. | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in “000” | |||||||||
| 3. LONG TERM LOANS | |||||||||
| Secured | |||||||||
| Banking Company | 3.1 | 464,500 | 520,500 | ||||||
| Investment Bank | 3.2 | 29,440 | 37,500 | ||||||
| Unsecured | |||||||||
| Sponsors | 3.3 | — | 45,000 | ||||||
| ——————– | ——————– | ||||||||
| 493,940 | 603,000 | ||||||||
| Less: Payable within one year shown | |||||||||
| under current liabilities | (85,222) | (85,099) | |||||||
| ——————– | ——————– | ||||||||
| 408,718 | 517,901 | ||||||||
| =========== | =========== | ||||||||
| 3.1 This loan is secured against first charge by way of equitable mortgage on the fixed assets, | |||||||||
| floating charge on books debts and hypothecation on plant / machinery and equipments | |||||||||
| other than of Line ~A’ and quarry equipments. The sanctioned amount of loan is | |||||||||
| Rs. 524.236 million and is repayable in monthly instalments. The mark-up rate is 45 paisas | |||||||||
| per Rs. 1,000/- per day. | |||||||||
| 3.2 This loan is secured against second charge upto Rs. 68 million on the plant and equipment | |||||||||
| other than of Line ‘A’. This loan is repayable in monthly installments and will be paid in full | |||||||||
| by October 2000. The rate of mark up is 21%per annum. | |||||||||
| 3.3 This loan has been transferred to short term loan. | |||||||||
| 4. LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE | |||||||||
| Opening balance | 13 6,13 9 | 101,585 | |||||||
| Transferred / obtained during the year | 4,510 | 35,000 | |||||||
| ——————– | ——————– | ||||||||
| 140,649 | 136,585 | ||||||||
| Paid during the year | (15,744) | (446) | |||||||
| ——————– | ——————– | ||||||||
| 124,905 | 136,139 | ||||||||
| Payable within one year shown under | |||||||||
| Current liabilities | (48,883) | (29,430) | |||||||
| ——————– | ——————– | ||||||||
| 76,022 | 106,709 | ||||||||
| =========== | =========== | ||||||||
| 4.1 Liabilities against assets subject to finance lease represent liabilities for finances obtained | |||||||||
| under sale and lease back arrangements from a commercial bank and leasing companies. | |||||||||
| Effective from June 1999 the discounting rate of bank is reduced to 15% from previous | |||||||||
| rate of 21%. The approximate discounting rate of leasing companies is 20.5%. | |||||||||
| 4.2 The amount of future lease payments to which the Company is committed as at June 30, | |||||||||
| 1999 are as under: | |||||||||
| Year ending June 30 | Amount in “000” | ||||||||
| 2000 | 66,742 | ||||||||
| 2001 | 64,964 | ||||||||
| 2002 | 13,055 | ||||||||
| 2003 | 11,467 | ||||||||
| ——————– | |||||||||
| 156,228 | |||||||||
| Less: Finance charges allocated | |||||||||
| to future periods | 31,323 | ||||||||
| ——————– | |||||||||
| 124,905 | |||||||||
| =========== | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 5. DEFERRED LIABILITIES | |||||||||
| Staff gratuity | 8,338 | 6,718 | |||||||
| Retention money | |||||||||
| Contractor – local | 5.1 | — | 49,552 | ||||||
| Plant and machinery – foreign suppliers | 5.2 | 11,477 | 12,140 | ||||||
| Encashment of performance | |||||||||
| guarantee (US$ 1,313,250) | 5.2 | 56,179 | 56,179 | ||||||
| ——————– | ——————– | ||||||||
| 75,994 | 124,589 | ||||||||
| =========== | =========== | ||||||||
| 5.1 This represented retention money of local contractors and balance amount is transferred | |||||||||
| to current liabilities. | |||||||||
| 5.2 These represent net retention money and proceed of encashment of performance | |||||||||
| guarantee. The encashment amount of performance guarantee is valued at the conversion | |||||||||
| rate prevailing at the date of encashment. These amounts are likely to be settled against | |||||||||
| the claims made by the company (refer note # 10.2). | |||||||||
| 6. LONG TERM DEPOSITS – Unsecured | |||||||||
| Cement Stockists | 6.1 | 4,109 | 6,704 | ||||||
| Transporters | 6.2 | 11,900 | 12,400 | ||||||
| Others | 130 | 130 | |||||||
| ——————– | ——————– | ||||||||
| 16,139 | 19,234 | ||||||||
| =========== | =========== | ||||||||
| 6.1 These represent interest free security deposits received from Stockists and are repayable | |||||||||
| on cancellation or withdrawal of stockistship and adjustable with unpaid amount of sales. | |||||||||
| 6.2 These represent interest free security deposits received from transporters and are repay able | |||||||||
| on cancellation or withdrawal of contracts. | |||||||||
| 7. SHORT TERM FINANCES – Secured | 175,143 | 221,156 | |||||||
| =========== | =========== | ||||||||
| 7.1 These represent running finance facilities from commercial banks. The amount sanctioned | |||||||||
| is Rs. 230 million. These facilities are subject to average mark-up @ 15% p.a. and are | |||||||||
| secured by way of charge on stores and spares and assets ranking pari passu with the | |||||||||
| charge created to secure long term loans. | |||||||||
| 8. CURRENT PORTION OF LONG TERM | |||||||||
| LIABILITIES | |||||||||
| Long term loans | 85,222 | 85,099 | |||||||
| Liability against assets subject to finance lease | 48,883 | 29,430 | |||||||
| ——————– | ——————– | ||||||||
| 134,105 | 114,529 | ||||||||
| =========== | =========== | ||||||||
| 9. CREDITORS, ACCRUED AND OTHER | |||||||||
| LIABILITIES | |||||||||
| Creditors | 114,484 | 99,290 | |||||||
| Accrued expenses | 11,833 | 14,342 | |||||||
| Markup on secured long term loans & short term finances | 71,233 | 45,932 | |||||||
| Advances from customers | 7,588 | 12,943 | |||||||
| Retention money | 29,326 | 5,333 | |||||||
| Workers’ profit participation fund | 2,917 | — | |||||||
| Withholding taxes | 3 8 0 | 674 | |||||||
| Others | 276 | 89 | |||||||
| ——————– | ——————– | ||||||||
| 238,037 | 178,603 | ||||||||
| =========== | =========== | ||||||||
| 10. CONTINGENCIES AND COMMITMENTS | |||||||||
| Contingencies | |||||||||
| 10.1 Under SRO 484(1 )/92 dated May 14, 1992 the plant and machinery not being manufactured | |||||||||
| locally was exempt from custom duty and sales tax, if imported before June 30, 1995. The | |||||||||
| Company obtained certificates from the Ministry of Industries and Central Board of | |||||||||
| Revenue (CBR) that the machinery being imported was not manufactured locally. In | |||||||||
| April 1995 the Central Board of Revenue advised the Custom authorities that the local | |||||||||
| industry was capable of manufacturing some of the equipment being imported by the | |||||||||
| Company, and that exemption from custom duty and sales tax on such equipments be | |||||||||
| denied. The Company has filed a writ petition against CBR’s instructions before the | |||||||||
| Peshawar High Court. The High Court was pleased to grant an ad interim injunction | |||||||||
| which was later on confirmed. The amount of levy is not ascertained at this stage. The | |||||||||
| case is pending with Peshawar High Court for final decision. | |||||||||
| 10.2 The company has field suits against the supplier of main plant and machinery in the Sindh | |||||||||
| High Court, Karachi on account of uneconomical operation, short supply of equipment and | |||||||||
| parts and supply of sub-standard/defective parts etc. The suits are pending with the High | |||||||||
| Court and the total amount of these claims are not determinable in monetary terms at this | |||||||||
| stage. | |||||||||
| 10.3 In January, 1995, the Chinese Supplier of the plant sent a shipment of certain equipment | |||||||||
| by air which were found to be short supplied at the time of erection. Since the equipment | |||||||||
| were part and parcel of the main plant, the supply was made free of charge. The custom | |||||||||
| authorities however, assessed the equipment to duties and taxes of Rs. 20,830,226/- which | |||||||||
| was paid in full. The Company disputed this levy and filed an appeal before the Customs, | |||||||||
| Excise and Sales Tax Appellate Tribunal. The Tribunal has set aside the impugned | |||||||||
| assessment, waived the fine and penalty of Rs. 3,650,000/- and Rs. 1,000,000/- respectively | |||||||||
| and directed the custom authorities to re-determine the value of the goods and assess the | |||||||||
| same at concessional rate of duty @ 25% of tariff rate as per SRO No.978(1)/95 dated | |||||||||
| October 4, 1995. | |||||||||
| 10.4 The Income Tax department has filed an appeal before the Income Tax Appellate Tribunal | |||||||||
| against an order passed by the Commission (Appeals) in favour of the Company with | |||||||||
| respect to levy of tax amounting to Rs. 85 million on certain pre operational earnings for | |||||||||
| the assessment years 1994-95, 1995-96 and 1996-97. No liability has been accounted for | |||||||||
| in these accounts in lieu of the relief granted by the Commissioner (Appeals). | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| Commitments in respect of | |||||||||
| Letters of credit | 21,279 | 12,600 | |||||||
| 11. OPERATING ASSETS | |||||||||
| Cost at | Addition / | Cost at | Accumulated | Depreciation | Rate | Accumulated | Book value | ||
| July 01 | (disposal) | June 30 | depreciation | /adjustment | % | depreciation | at June 30 | ||
| Particulars | 1998 | 1999 | at July 01 | for the year | p.a. | at June 30 | 1999 | ||
| 1998 | 1999 | ||||||||
| Land- free hold | 5,309 | 56 | 5,365 | — | — | — | — | 5,365 | |
| Building on free hold Land | 849,482 | 13,946 | 863,428 | 45,512 | 43,172 | 5 | 88,684 | 774,744 | |
| Plant and machinery | 2,848,938 | 32,769 | 2,881,707 | 101,612 | 96,057 | UPM | 197,669 | 2,684,038 | |
| Quarry equipment | 183,417 | 1,306 | 184,723 | 13,755 | 9,606 | 5 | 23,361 | 161,362 | |
| Vehicles | 18,088 | 393 | 18,481 | 11,521 | 1,392 | 20 | 12,913 | 5,568 | |
| Furniture and fixtures | 5,077 | 14 | 5,091 | 1,641 | 345 | 10 | 1,986 | 3,105 | |
| Office equipment | 18,927 | 718 | 19,520 | 5,932 | 1,365 | 10 | 7,235 | 12,285 | |
| (125) | (62) | ||||||||
| Other assets | 9,378 | l, 104 | 10,482 | 2,422 | 806 | 10 | 3,228 | 7,254 | |
| —————- | —————- | —————- | —————- | —————- | —————- | —————- | —————- | ||
| 3,938,616 | 50,306 | 3,988,797 | 182,395 | 152,743 | 335,076 | 3,653,721 | |||
| (125) | (62) | ||||||||
| Leased | |||||||||
| Plant and machinery | 135,000 | — | 135,000 | 5,778 | 4,500 | UPM | 10,278 | 124,722 | |
| Vehicles | 1,754 | — | 1,754 | 702 | 210 | 20 | 912 | 842 | |
| —————- | —————- | —————- | —————- | —————- | —————- | —————- | —————- | ||
| 136,754 | — | 136,754 | 6,480 | 4,710 | 11,190 | 125,564 | |||
| —————- | —————- | —————- | —————- | —————- | —————- | —————- | —————- | ||
| 4,075,370 | 50,306 | 4,125,551 | 188,875 | 157,453 | 346,266 | 3,779,285 | |||
| 1999 (Rupees in “000”) | (125) | (62) | |||||||
| ========= | ========= | ========= | ========= | ========= | ========= | ========= | ========= | ||
| 3,728,482 | 383,001 | 4,075,370 | 53,941 | 135,523 | 188,876 | 3,886,494 | |||
| 1998 (Rupees in “000”) | (36,113) | (588) | |||||||
| ========= | ========= | ========= | ========= | ========= | ========= | ========= | ========= | ||
| UPM = Unit of production method | |||||||||
| 11.1 A portion of land has been leased for twenty years to Lucky Powertech Limited, a wholly owned subsidiary company, for power | |||||||||
| plant. | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 11.2 Depreciation charge for the year | |||||||||
| has been allocated as follows: | |||||||||
| Cost of sales | 154,141 | 128,213 | |||||||
| Administration expenses | 3,159 | 7,127 | |||||||
| Selling expenses | 153 | 183 | |||||||
| —————- | —————- | ||||||||
| 157,453 | 135,523 | ||||||||
| ========= | ========= | ||||||||
| 11.3 Disposal’ of assets | |||||||||
| Particulars | Cost | Book | Sale | Mode of | Particulars | ||||
| Value | Proceeds | Disposal | of Buyers | ||||||
| Office equipment | 125 | 63 | 38 | Trade in | Khan Office Products, Karachi. | ||||
| ========= | ========= | ========= | |||||||
| 1999 (Rupees ‘000’) | 125 | 63 | 38 | ||||||
| ========= | ========= | ========= | |||||||
| 1998 (Rupees ‘000’) | 36,112 | 35,652 | 35,885 | ||||||
| ========= | ========= | ========= | |||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 12. CAPITAL WORK-IN-PROGRESS – at cost | |||||||||
| Building and civil works | 5,310 | 14,659 | |||||||
| Plant and machinery – Local | — | 1,990 | |||||||
| Quarry development | — | 1,018 | |||||||
| Electrification | 2 81 | 100 | |||||||
| Mechanical errection and installation | — | 38 | |||||||
| —————- | —————- | ||||||||
| 5,591 | 17,805 | ||||||||
| ========= | ========= | ||||||||
| 13. LONG TERM INVESTMENT | |||||||||
| Wholly owned subsidiary | |||||||||
| Lucky Powertech Limited – Unquoted | |||||||||
| 20,000,.000 fully paid Ordinary | |||||||||
| shares of Rs. 10/- each | 13.1 | 200,000 | 200,000 | ||||||
| ========= | ========= | ||||||||
| 13.1 No provision for diminution in value of investment has been considered necessary as the | |||||||||
| market value of this project at current rates is much higher than the book value and in the | |||||||||
| opinion of the Management such diminution is temporary in nature. | |||||||||
| Latest financial statements of subsidiary and statement under section 237 of Companies | |||||||||
| Ordinance, 1984, are enclosed | |||||||||
| 14. LONG TERM DEPOSITS AND | |||||||||
| DEFERRED COSTS | |||||||||
| Long term lease deposits | 12,924 | 12,924 | |||||||
| Deferred Costs | |||||||||
| Preliminary expenses | 2,507 | 2,507 | |||||||
| Expenses on issue of shares | 41,046 | 41,046 | |||||||
| Quarry development costs | 13,145 | 12,135 | |||||||
| Other deferred costs | 2,493 | 2,493 | |||||||
| —————- | —————- | ||||||||
| 59,191 | 58,181 | ||||||||
| Less · Amortization of deferred costs | (29,280) | (17,442) | |||||||
| —————- | —————- | ||||||||
| 29,911 | 40,739 | ||||||||
| —————- | —————- | ||||||||
| 42,835 | 53,663 | ||||||||
| ========= | ========= | ||||||||
| 15. STORES AND SPARES | |||||||||
| Stores | 28,059 | 23,800 | |||||||
| Spares | 128,757 | 87,417 | |||||||
| Spares in transit | 14,405 | 3,234 | |||||||
| —————- | —————- | ||||||||
| 171,221 | 114,451 | ||||||||
| ========= | ========= | ||||||||
| 16. STOCK-IN-TRADE | |||||||||
| Raw and. packing material | 8,358 | 7,659 | |||||||
| Work-in-process | 49,867 | 19,774 | |||||||
| Finished goods | 7,510 | 35,692 | |||||||
| —————- | —————- | ||||||||
| 65,735 | 63,125 | ||||||||
| ========= | ========= | ||||||||
| 17. ADVANCES, DEPOSITS, PREPAYMENTS | |||||||||
| AND OTHER RECEIVABLES | |||||||||
| Loans and advances | |||||||||
| Employees | 1,447 | 1,650 | |||||||
| Advance to wholly owned subsidiary | |||||||||
| for power supply | 123,021 | 129,889 | |||||||
| Advance income tax | 48,735 | 40,759 | |||||||
| Excise duty | 2,694 | 865 | |||||||
| Advance to suppliers and others | 20,804 | 29,437 | |||||||
| —————- | —————- | ||||||||
| 196,701 | 202,600 | ||||||||
| Deposits and prepayments | |||||||||
| Deposits | 3,840 | 3,858 | |||||||
| Prepayments | 492 | 331 | |||||||
| —————- | —————- | ||||||||
| 4,332 | 4,189 | ||||||||
| Other receivables – Considered goods | |||||||||
| Octroi refundable | 4,470 | 4,094 | |||||||
| Insurance claim | — | 330 | |||||||
| Freight | 3,743 | 102 | |||||||
| Custom duty | 20,83 0 | 20,830 | |||||||
| Others | 954 | 1,138 | |||||||
| —————- | —————- | ||||||||
| 29,997 | 26,494 | ||||||||
| —————- | —————- | ||||||||
| 231,030 | 233,283 | ||||||||
| ========= | ========= | ||||||||
| 18. CASH AND BANK BALANCES | |||||||||
| Bank balances | |||||||||
| Current accounts | 24,145 | 14,325 | |||||||
| PLS accounts | 262 | 768 | |||||||
| —————- | —————- | ||||||||
| 24,407 | 15,093 | ||||||||
| Cash in hand | 4 3 | 46 | |||||||
| —————- | —————- | ||||||||
| 24,450 | 15,139 | ||||||||
| ========= | ========= | ||||||||
| 19. SALES – net | |||||||||
| Sales | 2,542,973 | 1,791,561 | |||||||
| Less · Excise duty | 1,063,138 | 776,123 | |||||||
| Loading and other charges | 4,871 | 5,432 | |||||||
| —————- | —————- | ||||||||
| 1,068,009 | 781,555 | ||||||||
| —————- | —————- | ||||||||
| 1,474,9 64 | 1,010,006 | ||||||||
| ========= | ========= | ||||||||
| 20. COST OF SALES | |||||||||
| Raw material | 23,745 | 20,211 | |||||||
| Packing material | 167,948 | 122,853 | |||||||
| Fuel and power | 703,720 | 553,933 | |||||||
| Stores and spares | 42,646 | 31,100 | |||||||
| Salaries and wages | 60,720 | 57,577 | |||||||
| Repairs and maintenance | 3,278 | 7,921 | |||||||
| Depreciation | 154,741 | 128,213 | |||||||
| Insurance | 39,691 | 27,954 | |||||||
| Amortization of quarry development | 2,629 | 2,427 | |||||||
| Other manufacturing expenses | 15,741 | 15,568 | |||||||
| —————- | —————- | ||||||||
| 1,214,259 | 967,757 | ||||||||
| —————- | —————- | ||||||||
| Work-in-process | |||||||||
| Opening | 19,77 4 | 22,903 | |||||||
| Closing | (49,867) | (19,774) | |||||||
| —————- | —————- | ||||||||
| (30,093) | 3,969 | ||||||||
| —————- | —————- | ||||||||
| Cost of goods manufactured | 1,184,166 | 971,726 | |||||||
| Finished goods | |||||||||
| Opening | 35,692 | 7,671 | |||||||
| Closing | (7,510) | (35,692) | |||||||
| —————- | —————- | ||||||||
| 28,182 | (28,021) | ||||||||
| —————- | —————- | ||||||||
| 1,212,348 | 943,705 | ||||||||
| ========= | ========= | ||||||||
| 21. ADMINISTRATIVE EXPENSES | |||||||||
| Salaries and benefits | 11,317 | 14,091 | |||||||
| Communication | 2,883 | 3,092 | |||||||
| Amortization of deferred cost | 9,209 | 9,209 | |||||||
| Traveling and conveyance | 1,095 | 3,336 | |||||||
| Depreciation | 3,15 9 | 7,127 | |||||||
| Insurance | 1,229 | 94 | |||||||
| Vehicle running and maintenance | 952 | 795 | |||||||
| Advertisement | 3 5 7 | 1,150 | |||||||
| Printing and stationery | 764 | 1,830 | |||||||
| Security services | 25 3 | 620 | |||||||
| Entertainment | 3 7 7 | 201 | |||||||
| Legal and professional | 2,099 | 2,106 | |||||||
| Transportation and freight | 3 8 3 | 504 | |||||||
| Rent, rates and taxes | 720 | 752 | |||||||
| Utilities | 793 | 804 | |||||||
| Repair and maintenance | 5 9 8 | 198 | |||||||
| Auditors’ remuneration | 21. l | 17 3 | 100 | ||||||
| Charity and donation | 61 | 97 | |||||||
| Fees and subscription | 678 | 405 | |||||||
| Others | 667 | 268 | |||||||
| —————- | —————- | ||||||||
| 37,767 | 46,779 | ||||||||
| ========= | ========= | ||||||||
| 21.1 Auditors’ Remuneration | |||||||||
| Statutory audit fee | 100 | 100 | |||||||
| Cost audit fee | 60 | — | |||||||
| Out of pocket expenses | 13 | — | |||||||
| —————- | —————- | ||||||||
| 173 | 100 | ||||||||
| ========= | ========= | ||||||||
| 22. SELLING AND DISTRIBUTION EXPENSES | |||||||||
| Salaries and benefits | 6,972 | 4,274 | |||||||
| Communication | 2,190 | 2,522 | |||||||
| Travelling and conveyance | 45 5 | 389 | |||||||
| Printing and stationery | 2 4 0 | 301 | |||||||
| Utilities | 630 | 625 | |||||||
| Vehicle running and maintenance | 465 | 351 | |||||||
| Repairs and maintenance | 153 | 107 | |||||||
| Depreciation | 15 4 | 183 | |||||||
| Fees and subscription | 20 | 21 | |||||||
| Rent, rates and taxes | 864 | 622 | |||||||
| Advertisement | 5 41 | 369 | |||||||
| Entertainment | 2 2 0 | 156 | |||||||
| Insurance | 276 | 33 | |||||||
| Others | 1,152 | 598 | |||||||
| —————- | —————- | ||||||||
| 14,332 | 10,551 | ||||||||
| ========= | ========= | ||||||||
| 23. OTHER INCOME | |||||||||
| Gain / (loss) on sale of assets | (24) | 232 | |||||||
| Miscellaneous | 650 | 397 | |||||||
| —————- | —————- | ||||||||
| 626 | 629 | ||||||||
| ========= | ========= | ||||||||
| 24. FINANCIAL CHARGES | |||||||||
| Mark-up on | |||||||||
| Long term loans | 87,599 | 3,199 | |||||||
| Lease finances | 27,208 | 15,927 | |||||||
| Short term borrowings | 33,904 | 22,161 | |||||||
| Bank charges and commission | 4,084 | 2,494 | |||||||
| —————- | —————- | ||||||||
| 152,795 | 123,781 | ||||||||
| ========= | ========= | ||||||||
| 25. TAXATION | |||||||||
| Current | |||||||||
| Taxable income is worked out to be a tax loss. The company has not made provision for | |||||||||
| turnover tax of Rs. 7 Million u/s 80D of the Income Tax Ordinance 1979, as it has filed an | |||||||||
| appeal for allowing an exemption on account of clause 118C of the Second Schedule to the | |||||||||
| Income Tax Ordinance, 1979. | |||||||||
| Deferred | |||||||||
| In view of tax losses available to be carried forward there is no deferred tax liability. | |||||||||
| 26. REMUNERATION OF EXECUTIVES | |||||||||
| Remuneration | 13,460 | 14,116 | |||||||
| House rent allowance | 6,084 | 6,353 | |||||||
| Utilities allowance | 1,346 | 1,412 | |||||||
| Conveyance allowance | 1,282 | 1,412 | |||||||
| —————- | —————- | ||||||||
| 22,172 | 23,293 | ||||||||
| ========= | ========= | ||||||||
| Number of Persons | 77 | 80 | |||||||
| ========= | ========= | ||||||||
| No remuneration were paid to Chief Executive and/or Directors of the Company. The Chief | |||||||||
| Executive has voluntarily decided not to accept any remuneration for the year ended June 30, | |||||||||
| 1999. | |||||||||
| 27. AGGREGATE TRANSACTIONS WITH | |||||||||
| SUBSIDIARY COMPANY | |||||||||
| Purchase of power | 312,479 | 229,427 | |||||||
| Rent | 278 | 278 | |||||||
| 28. PRODUCTION CAPACITY | Metric tons | ||||||||
| Installed capacity (330 days) | 1,320,000 | 1,320,000 | |||||||
| Actual production | 682,032 | 526,184 | |||||||
| Reasons for short fall: Lack of demand. | |||||||||
| 29. EARNING PER SHARE | |||||||||
| There is no dilutive effect on the basic earning per share of the company which is based on:- | |||||||||
| Profit after tax (Rs. in million) | 55,431 | ||||||||
| Weighted average number of Ordinary shares | 245,000,000 | ||||||||
| Earning per share (Rupees) | 0.22 | ||||||||
| 30. FINANCIAL INSTRUMENTS | |||||||||
| AND RELATED DISCLOSURES | |||||||||
| Concentration of credit risk | |||||||||
| Credit risk represents the accounting loss that would be recognized at the reporting date if counter | |||||||||
| parties failed completely to perform as contracted. The Company applies credit limits to its | |||||||||
| customers and does not have significant exposure to any individual customer. | |||||||||
| Interest rate risk | |||||||||
| Interest rate risk arise from the possibility that changes in interest rates will effect the value of | |||||||||
| financial instruments. The Company is not exposed to interest rate risk. | |||||||||
| Fair values of financial instruments | |||||||||
| The carrying value of all the financial instruments reported in the financial statements approximate | |||||||||
| their fair value. | |||||||||
| 31. OWNERS’ EQUITY | |||||||||
| Movements in owner’s equity during the year are identified and adequately disclosed in the | |||||||||
| financial statements. | |||||||||
| 32. STATEMENT AND REPORT UNDER SECTION 237 | |||||||||
| OF THE COMPANIES ORDINANCE, 1984 FOR | |||||||||
| LUCKY POWERTECH LIMITED, | |||||||||
| WHOLLY OWNED SUBSIDIARY | |||||||||
| Statement under section (1) (e) of | |||||||||
| a) Extent of the interest of Lucky Cement Limited (the | |||||||||
| holding company) in the equity of its subsidiary as at | 100 % | ||||||||
| the end of the last date of the financial year of the | |||||||||
| subsidiary. | |||||||||
| b) The net aggregate amount of revenue/profits less losses | |||||||||
| of the subsidiary, company, so far as these concern | |||||||||
| members of the holding Company and has not been | |||||||||
| dealt with in the accounts of the holding Company’ for | |||||||||
| the year ended June 30, 1999 are: | |||||||||
| i) For the last financial year of’ the subsidiary | 30.523 million | ||||||||
| ii) For the previous years upto June 30, 1998 | (74.163 million) | ||||||||
| subsequent to the acquisition of the controlling | |||||||||
| interest by the holding company. | |||||||||
| c) The net aggregate amount of profits less losses of the | |||||||||
| subsidiary company so far as these have been dealt | |||||||||
| with or provision made for losses in the account of the | |||||||||
| holding company for the year ended June 30, 1999 | |||||||||
| i) For the last of the financial year of the subsidiary | Nil | ||||||||
| ii) For the previous years upto June 30, 1998 but | Nil | ||||||||
| subsequent to the acquisition of the controlling | |||||||||
| interest by the holding company | |||||||||
| 33. GENERAL | |||||||||
| Figures have been rounded off to the nearest thousand of Rupees. | |||||||||
| Corresponding figures have been rearranged and/or regrouped, whenever necessary for the | |||||||||
| purpose of comparison. | |||||||||
| Total number of permanent employees at the year end are 528. | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| STATEMENT AND REPORT UNDER | |||||||||
| SECTION 237 OF | |||||||||
| THE COMPANIES ORDINANCE, 1984 | |||||||||
| SUBSIDIARY | |||||||||
| LUCKY POWERTECH | |||||||||
| LIMITED | |||||||||
| Statement under section (1) (e) of | |||||||||
| a) Extent of the interest of Lucky Cement Limited (the holding | |||||||||
| company) in the equity of its subsidiary as at the end of the last | 100 % | ||||||||
| date of the financial year of the subsidiary. | |||||||||
| b) The net aggregate amount of revenue/profits less losses of | |||||||||
| the subsidiary company, so far as these concern members of | |||||||||
| the holding Company and has not been dealt with in the accounts | |||||||||
| of the holding Company for the year ended June 30, 1999 are: | |||||||||
| i) For the last financial year of the subsidiary | 30.523 million | ||||||||
| ii) For the previous years upto June 30, 1998 subsequent to | |||||||||
| the acquisition of the controlling interest by the holding | (74.163 million) | ||||||||
| company. | |||||||||
| c) The net aggregate amount of profits, less losses of the subsidiary | |||||||||
| company so far as these have been dealt with or provision | |||||||||
| made for losses in the account of the holding company for the | |||||||||
| year ended June 30, 1999 | |||||||||
| i) for the last financial year of the subsidiary | Nil | ||||||||
| ii) for the previous years upto June 30, 1998 subsequent to | |||||||||
| the acquisition of the controlling interest by the holding | Nil | ||||||||
| company | |||||||||
| LUCKY POWERTECH LIMITED | |||||||||
| WHOLLY OWNED SUBSIDIARY | |||||||||
| OF | |||||||||
| LUCKY CEMENT LIMITED | |||||||||
| DIRECTORS REPORT | |||||||||
| We are pleased to present the 5th Annual Report of the company together with the Audited Accounts | |||||||||
| for the year ended on June 30, 1999 and Auditors’ Report thereon. | |||||||||
| During the year under review, the company operated as a captive power plant and supplied electricity | |||||||||
| solely to Lucky Cement Limited which is its holding company. The total generation capacity of the | |||||||||
| company was drastically under-utilised due to the under capacity utilisation of cement plant owing to | |||||||||
| over supply position of cement in Pakistan. However, the gross sales of our company increased by | |||||||||
| 36% as compared to the last year. | |||||||||
| Despite of the under-capacity utilisation, your company managed to earn a gross profit of Rs.91.05 | |||||||||
| million for the current year which is 29% of the net sales as against the gross profit of Rs.41.7 | |||||||||
| million in the preceding year which was 18.4% of the net sales. The year closed with the net profit | |||||||||
| of Rs. 30.523 million against the net loss of Rs. 29.378 million in the preceding year. In view of net | |||||||||
| profit for the current year, the accumulated loss of Rs. 74.163 has been reduced to Rs. 43.640 | |||||||||
| million. The earning per shares for the current year was Rs. 1.53. | |||||||||
| Millennium Bug in Computer System | |||||||||
| We have taken adequate measures to protect the company against Y2K problems. | |||||||||
| Auditors | |||||||||
| The auditors, M. Yousuf Adil Saleem & Co. Chartered Accountants retire and being eligible offer | |||||||||
| themselves for reappointment. | |||||||||
| Acknowledgment | |||||||||
| Your directors acknowledge with appreciation, the efforts of the company’s managers, technicians | |||||||||
| and workers and the support extended by the company’s bankers and leasing companies. | |||||||||
| By order of the Board | |||||||||
| ABDUL RAZZAK TABBA | |||||||||
| Karachi: December 7, 1999 | Chairman & Chief Executive | ||||||||
| AUDITORS’ REPORT TO THE MEMBERS | |||||||||
| We have audited the annexed balance sheet of Lucky Powertech Limited as at June 30, 1999 and | |||||||||
| related profit and loss account and the 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 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 and 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 and the | |||||||||
| changes in financial position for the period then ended; and | |||||||||
| d. in our opinion, no zakat was deductible at source under the Zakat and Ushr Ordinance, 1980. | |||||||||
| M.YOUSUF ADIL SALEEM & CO., | |||||||||
| Karachi: December 7, 1999 | Chartered Accountants | ||||||||
| BALANCE SHEET AS AT JUNE 30, 1999 | |||||||||
| Note | 19 9 9 | 1998 | |||||||
| Amount in “000” | |||||||||
| SHARE CAPITAL | |||||||||
| Authorised | |||||||||
| 20,000,000 Ordinary shares of Rs. 10/- each | 200,000 | 200,000 | |||||||
| =========== | =========== | ||||||||
| Issued, subscribed and paid-up | |||||||||
| 20,000,000 Ordinary of Rs. 10/- each fully paid in cash | 200,000 | 200,000 | |||||||
| Accumulated loss | (43,640) | (74,163) | |||||||
| ——————– | ——————– | ||||||||
| 156,360 | 125,837 | ||||||||
| LONG TERM LOANS | 3 | 196,400 | 224,700 | ||||||
| LIABILITIES AGAINST ASSETS SUBJECT | |||||||||
| TO FINANCE LEASE | 4 | 21,771 | 86,139 | ||||||
| DEFERRED LIABILITIES | 5 | 40,535 | 105,607 | ||||||
| CURRENT LIABILITIES | |||||||||
| Current portion of long terms liabilities | 6 | 87,222 | 61,974 | ||||||
| Creditors, accrued and other liabilities | 7 | 205,239 | 143,735 | ||||||
| ——————– | ——————– | ||||||||
| 292,461 | 205,709 | ||||||||
| ——————– | ——————– | ||||||||
| 707,527 | 747,992 | ||||||||
| =========== | =========== | ||||||||
| FIXED ASSETS – TANGIBLE | |||||||||
| Operating assets | 8 | 666,123 | 704,375 | ||||||
| LONG TERM LEASE DEPOSITS AND | |||||||||
| DEFERRED COST | 9 | 22,220 | 22,283 | ||||||
| CURRENT ASSETS | |||||||||
| Stores and spares | 12,442 | 15,975 | |||||||
| Advances, deposits and other receivables | 10 | 5,491 | 4,697 | ||||||
| Bank balances | 11 | 1,251 | 662 | ||||||
| ——————– | ——————– | ||||||||
| 19,184 | 21,334 | ||||||||
| ——————– | ——————– | ||||||||
| 707,527 | 747,992 | ||||||||
| =========== | =========== | ||||||||
| The annexed notes from 1 to 22 form an integral part of these accounts. | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| PROFIT AND LOSS ACCOUNT | |||||||||
| FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in “000” | |||||||||
| Sales – net | 12 | 309,499 | 226,774 | ||||||
| Cost of generation | 13 | 218,451 | 185,062 | ||||||
| ——————– | ——————– | ||||||||
| Gross profit | 91,048 | 41,712 | |||||||
| Administrative expenses | 14 | 1,428 | 1,672 | ||||||
| ——————– | ——————– | ||||||||
| Operating profit | 89,620 | 40,040 | |||||||
| Financial charges | 15 | 5 7,491 | 69,418 | ||||||
| Workers’ profit participants fund | 1,606 | — | |||||||
| ——————– | ——————– | ||||||||
| 59,097 | 69,418 | ||||||||
| ——————– | ——————– | ||||||||
| Profit / (loss) for the year | 30,523 | (29,378) | |||||||
| Accumulated loss brought forward | (74,163) | (44,785) | |||||||
| ——————– | ——————– | ||||||||
| Accumulated loss carried forward | (43,640) | (74,163) | |||||||
| =========== | =========== | ||||||||
| Earning per share | 19 | Rs. 1.53 | |||||||
| The annexed notes from 1 to 22 form an integral part of these accounts | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| STATEMENT OF CHANGES IN FINANCIAL POSITION | |||||||||
| (CASH FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “‘000” | |||||||||
| A. CASH FROM OPERATING ACTIVITIES | |||||||||
| Profit / (loss) for the year | 30,523 | (29,378) | |||||||
| adjustments for: | |||||||||
| Depreciation | 38,252 | 38,251 | |||||||
| Provision for gratuity | 318 | 231 | |||||||
| Financial charges | 57,491 | 69,418 | |||||||
| Deferred cost | 63 | 62 | |||||||
| ——————– | ——————– | ||||||||
| Operating profit before working capital changes | 126,647 | 78,584 | |||||||
| Changes in working capital | |||||||||
| Increase / (Decrease) in current assets | |||||||||
| Stores and spares | 3,533 | (8,831) | |||||||
| Advances, deposits and other receivables | (794) | (2,304) | |||||||
| Increase / Decrease in current liabilities | |||||||||
| Creditors, accrued and other liabilities | 9,206 | 68,512 | |||||||
| ——————– | ——————– | ||||||||
| Cash generated from operation | 13 8,646 | 135,961 | |||||||
| Financial charges paid | (41,675) | (66,999) | |||||||
| ——————– | ——————– | ||||||||
| Net cash from operating activities | 96,971 | 68,962 | |||||||
| ——————– | ——————– | ||||||||
| B. CASH FROM INVESTING ACTIVITIES: | — | — | |||||||
| ——————– | ——————– | ||||||||
| C. CASH FROM FINANCING ACTIVITIES | |||||||||
| Long term loans paid | (15,500) | (23,070) | |||||||
| Lease finances paid | (51,920) | (37,699) | |||||||
| Deferred liabilities | (28,962) | (7,809) | |||||||
| ——————– | ——————– | ||||||||
| (96,382) | (68,578) | ||||||||
| ——————– | ——————– | ||||||||
| Net increase / (decrease) in cash and | |||||||||
| cash equivalents (A+B+C) | 589 | 384 | |||||||
| Bank balances at the beginning of the year | 662 | 278 | |||||||
| ——————– | ——————– | ||||||||
| Bank balances at the end of the year | 1,251 | 662 | |||||||
| =========== | =========== | ||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| NOTES TO THE ACCOUNTS | |||||||||
| FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| 1. THE COMPANY AND ITS OPERATION | |||||||||
| Lucky Powertech Limited was incorporated on June 26, 1994 under the Companies Ordinance | |||||||||
| 1984. The principal activity of the Company is to generate and provide electricity. The project is | |||||||||
| located at District Lakki Marwat in North West Frontier Province. The Company is a wholly | |||||||||
| owned subsidiary of Lucky Cement Limited.. | |||||||||
| 2. SIGNIFICANT ACCOUNTING POLICIES | |||||||||
| 2.1 Accounting convention | |||||||||
| These accounts have been prepared under the ‘historical cost convention’. | |||||||||
| 2.2 Staff retirement benefit | |||||||||
| The Company operates an unfunded gratuity scheme for all its employees. Annual provisions | |||||||||
| are made in the accounts to cover the liability, | |||||||||
| 2.3 Fixed assets and depreciation | |||||||||
| Operating assets | |||||||||
| These are stated at cost less accumulated depreciation. | |||||||||
| Depreciation is charged to income applying the straight line method at the rates mentioned | |||||||||
| in the relevant note except plant and machinery on which depreciation is charged on unit | |||||||||
| of production method based on higher of estimated life and production. Full year’s | |||||||||
| depreciation is charged on additions while no depreciation is charged on assets deleted, | |||||||||
| However, capitalization of project cost is depreciated proportionately for the period of | |||||||||
| use. | |||||||||
| Maintenance and normal repairs are charged to income as and when incurred. Major | |||||||||
| renewals and improvements are capitalized. | |||||||||
| Gains and losses on disposal of assets, if any, are included in income currently. | |||||||||
| 2.4 Assets subject to finance lease | |||||||||
| Assets subject to finance lease are stated at the lower of present value of minimum lease | |||||||||
| payments under the lease agreements and fair value of the assets. The related obligations | |||||||||
| of the lease are accounted for as liabilities. Assets acquired under the finance leases are | |||||||||
| depreciated at the rates specified in relevant note. | |||||||||
| 2.5 Deferred cost | |||||||||
| Deferred cost is amortized over a maximum period of five years beginning from the year | |||||||||
| of deferment. | |||||||||
| 2.6 Stores and spares | |||||||||
| These are valued at moving average cost. Item in transit are stated at cost accumulated | |||||||||
| upto the balance sheet date. | |||||||||
| 2.7 Taxation | |||||||||
| Profits and gains of the Company are exempt from levy of income tax under clause 176 | |||||||||
| of Part-I and Clause 20 of Part-IV of the Second Schedule to the Income Tax | |||||||||
| Ordinance, 1979. | |||||||||
| 2.8 Foreign Currency transactions | |||||||||
| Assets and liabilities in foreign currencies are translated into Pak Rupees at the rates of | |||||||||
| exchange ruling at the balance sheet date, except where forward exchange contracts | |||||||||
| have been entered into for payment of liabilities in which case the rate contracted for is | |||||||||
| used. Exchange gains and losses on translation are allocated to preproduction expenses | |||||||||
| till commercial production commences and thereafter to profit and loss account. | |||||||||
| 2.9 Revenue Recognition | |||||||||
| Revenue is recognized on the basis of electricity supplied to the consumer. | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 3. LONG TERM LOANS | |||||||||
| Secured | |||||||||
| Banking company | |||||||||
| Demand Finance – I | 3.1 | 134,500 | 150,000 | ||||||
| Demand Finance – II | 3.1 | 60,400 | 60,400 | ||||||
| Unsecured | |||||||||
| Sponsors | 3.2 | 14,300 | 14,300 | ||||||
| ——————– | ——————– | ||||||||
| 209,200 | 224,700 | ||||||||
| Payable within one year shown under | |||||||||
| current liabilities | 12,800 | — | |||||||
| ——————– | ——————– | ||||||||
| 196,400 | 224,700 | ||||||||
| =========== | =========== | ||||||||
| 3.1 The demand finance I and II are secured against mortgage on the fixed assets and | |||||||||
| hypothecation of plant and machinery and floating charge on book debts. These demand | |||||||||
| finances are subject to mark up @ 45 paisas per Rs. 1000/- per day. The sanctioned | |||||||||
| amount of loan is Rs. 232 million. The repayment of principal and mark up on these | |||||||||
| finances are on deferred payment basis and clubbed with the repayment of holding | |||||||||
| company. The substantial repayment for next financial year is likely to be made from the | |||||||||
| holding company. | |||||||||
| 3.2 This represents loan from sponsors and is interest free. | |||||||||
| 4. LIABILITIES AGAINST ASSETS | |||||||||
| SUBJECT TO FINANCE LEASE | |||||||||
| Opening balance | 148,113 | 185,812 | |||||||
| Paid during the year | (51,920) | (37,699) | |||||||
| ——————– | ——————– | ||||||||
| 96,193 | 148,113 | ||||||||
| Payable within one year shown under | |||||||||
| current liabilities | (74,422) | (61,974) | |||||||
| ——————– | ——————– | ||||||||
| 21,771 | 86,139 | ||||||||
| =========== | =========== | ||||||||
| 4.1 Liabilities against assets subject to finance lease represent liabilities for finance obtained | |||||||||
| under sale and lease back arrangement for diesel power generating sets from a commercial | |||||||||
| bank and leasing companies. Effective from June 1999 the discounting rate of bank is | |||||||||
| reduced to 15% from previous rate of 18.5%. Approximate discounting rate of leasing | |||||||||
| companies is 21% p.a. | |||||||||
| 4.2 The amount of future lease payments to which the Company is committed at June 30, | |||||||||
| 1999 are as under: | |||||||||
| Year ending June 30, | Amount in “000” | ||||||||
| 2000 | 74,933 | ||||||||
| 2001 | 36,006 | ||||||||
| ——————– | |||||||||
| 110,939 | |||||||||
| Less: Finance charges allocated to | |||||||||
| future periods | (14,746) | ||||||||
| ——————– | |||||||||
| 96,193 | |||||||||
| =========== | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in “000” | |||||||||
| 5. DEFERRED LIABILITIES | |||||||||
| Staff gratuity | 869 | 551 | |||||||
| Retention money | 5.1 | — | 64,925 | ||||||
| Accrued mark up | 5.2 | 39,666 | 40,131 | ||||||
| ——————– | ——————– | ||||||||
| 40,535 | 105,607 | ||||||||
| =========== | =========== | ||||||||
| 5.1 This represented retention money of supplier of power plant machinery and balance amount | |||||||||
| is transferred to current liabilities. | |||||||||
| 5.2 This represents accrued mark up on demand finance I & II. (Refer Note 3.1). | |||||||||
| 6. CURRENT PORTION OF LONG | |||||||||
| TERM LIABILITIES | |||||||||
| Long term loans | 12,800 | — | |||||||
| Liabilities against assets subject to finance lease | 74,422 | 61,974 | |||||||
| ——————– | ——————– | ||||||||
| 87,222 | 61,974 | ||||||||
| =========== | =========== | ||||||||
| 7. CREDITORS, ACCRUED AND | |||||||||
| OTHER LIABILITIES | |||||||||
| Advance against power supply | |||||||||
| from holding company | 123,021 | 129,889 | |||||||
| Advance from associated undertaking | 13,524 | — | |||||||
| Creditors | 3,467 | 1,808 | |||||||
| Accrued expenses | 2,697 | 2,587 | |||||||
| Retention money | 35,988 | 457 | |||||||
| Accrued markup | 21,594 | 5,313 | |||||||
| Workers’ profit participation fund | 1,60 6 | ||||||||
| Others | 3,342 | 3,681 | |||||||
| ——————– | ——————– | ||||||||
| 205,239 | 143,735 | ||||||||
| =========== | =========== | ||||||||
| 8. OPERATING ASSETS | |||||||||
| Cost at | Addition / | Cost at | Accumulated | Depreciation | Rate | Accumulated | Book value | ||
| July 01 | (disposal) | June 30 | depreciation | for the year | % | depreciation | at June 30 | ||
| Particulars | 1998 | 1999 | at July 01 | p.a. | at June 30 | 1999 | |||
| 1998 | 1999 | ||||||||
| Owned | |||||||||
| Building | 30,532 | – | 30,532 | 2,284 | 1,527 | 5 | 3,810 | 26,721 | |
| Plant and machinery | 508,065 | – | 508,065 | 38,107 | 25,403 | UPM | 63,510 | 444,555 | |
| Furniture and fixtures | 479 | – | 479 | 144 | 48 | 10 | 192 | 287 | |
| Office equipments | 1,388 | – | 1,388 | 415 | 139 | 10 | 554 | 834 | |
| Other assets | 1,026 | – | 1,026 | 257 | 103 | 10 | 360 | 666 | |
| ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ||
| 541,490 | – | 541,490 | 41,207 | 27,220 | 68,426 | 473,064 | |||
| Leased | |||||||||
| Plant and machinery | 220,639 | – | 220,639 | 16,548 | 11,032 | UPM | 27,580 | 193,059 | |
| ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ||
| 220,639 | – | 220,639 | 16,548 | 11,032 | 27,580 | 193,059 | |||
| ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ||
| 1999 (Rupees in “000”) | 762,129 | – | 762,129 | 57,754 | 38,252 | 96,005 | 666,123 | ||
| =========== | =========== | =========== | =========== | =========== | =========== | =========== | =========== | ||
| 998 (Rupees in “000”) | 761,877 | – | 762,129 | 19,503 | 38,251 | 57,754 | 704,375 | ||
| =========== | =========== | =========== | =========== | =========== | =========== | =========== | =========== | ||
| UPM = Unit of Production Method | |||||||||
| 8.1 The land on which the project is setup, has been obtained on lease of twenty years from Lucky Cement Limited, the holding company. | |||||||||
| 8.2 The Company has surplus power generation capacity after meeting the requirements of | |||||||||
| its holding company. The company is in process of finalizing arrangement with an associated | |||||||||
| company for selling power and has shifted one engine of 6.12 MW to the premises of | |||||||||
| Gadoon Textile Mills Limited. | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 8.3 Depreciation charge for the year | |||||||||
| has been allocated as follows · | |||||||||
| Cost of generation | 37,962 | 37,962 | |||||||
| Administrative expenses | 290 | 289 | |||||||
| ——————– | ——————– | ||||||||
| 38,252 | 38,251 | ||||||||
| =========== | =========== | ||||||||
| 9. LONG TERM LEASE DEPOSITS AND | |||||||||
| DEFERRED COST | |||||||||
| Long term lease deposits | 22,064 | 22,064 | |||||||
| Deferred cost | |||||||||
| Preliminary expenses | 312 | 312 | |||||||
| Amortization | |||||||||
| Opening balance | 9 3 | 31 | |||||||
| During the year | 63 | 62 | |||||||
| ——————– | ——————– | ||||||||
| 156 | (93) | ||||||||
| ——————– | ——————– | ||||||||
| 156 | 219 | ||||||||
| ——————– | ——————– | ||||||||
| 22,220 | 22,283 | ||||||||
| =========== | =========== | ||||||||
| 10. ADVANCES, DEPOSITS | |||||||||
| AND OTHER RECEIVABLES | |||||||||
| Advance to suppliers | 3,069 | 2,815 | |||||||
| Advance tax | 656 | 130 | |||||||
| Security deposits | 1,036 | 1,036 | |||||||
| Octroi refundable | 714 | 714 | |||||||
| Others | 16 | 2 | |||||||
| ——————– | ——————– | ||||||||
| 5,491 | 4,697 | ||||||||
| =========== | =========== | ||||||||
| 11. BANK BALANCES | |||||||||
| In current accounts | 901 | 312 | |||||||
| In PLS accounts | 350 | 350 | |||||||
| ——————– | ——————– | ||||||||
| 1,251 | 662 | ||||||||
| =========== | =========== | ||||||||
| 12. SALES – net | |||||||||
| Sales – net | 312,479 | 229,427 | |||||||
| Less: Electricity duty | (2,980) | (2,653) | |||||||
| ——————– | ——————– | ||||||||
| 309,499 | 226,774 | ||||||||
| =========== | =========== | ||||||||
| 13. COST OF GENERATION | |||||||||
| Oil and lubricants | 159,798 | 129,594 | |||||||
| Chemicals | 868 | 2,574 | |||||||
| Store and spares | 4,452 | 5,074 | |||||||
| Repair and maintenance | 5,777 | 664 | |||||||
| Salaries and wages | 7,911 | 7,277 | |||||||
| Depreciation | 37,9 62 | 37,962 | |||||||
| Insurance | 1,405 | 1,639 | |||||||
| Ground rent | 2 7 8 | 278 | |||||||
| ——————– | ——————– | ||||||||
| 218,451 | 185,062 | ||||||||
| =========== | =========== | ||||||||
| 14. ADMINISTRATIVE EXPENSES | |||||||||
| Communication | 4 41 | 457 | |||||||
| Boarding and lodging | 417 | 436 | |||||||
| Depreciation | 2 9 0 | 290 | |||||||
| Fees and subscription | 2 5 | 22 | |||||||
| Legal and professional | 14 | 127 | |||||||
| Audit fee | 5 0 | 50 | |||||||
| Amortization of deferred cost | 6 3 | 62 | |||||||
| Vehicle running and maintenance | 7 4 | 81 | |||||||
| Repair and maintenance | — | 30 | |||||||
| Travelling and conveyance | 4 5 | 60 | |||||||
| Others | 10 | 57 | |||||||
| ——————– | ——————– | ||||||||
| 1,428 | 1,672 | ||||||||
| =========== | =========== | ||||||||
| 15. FINANCIAL CHARGES | |||||||||
| Markup on | |||||||||
| Long term loans | 34,688 | 40,015 | |||||||
| Lease finances | 21,745 | 29,346 | |||||||
| Excise duty on lease finance-prior years | 1,052 | — | |||||||
| Bank commission and charges | 6 | 57 | |||||||
| ——————– | ——————– | ||||||||
| 57,491 | 69,418 | ||||||||
| =========== | =========== | ||||||||
| 16. REMUNERATION OF EXECUTIVES | |||||||||
| Remuneration | 2,257 | 2,497 | |||||||
| House rent allowance | 1,016 | 1,123 | |||||||
| Utilities allowance | 22 6 | 250 | |||||||
| Conveyance allowance | 226 | 250 | |||||||
| ——————– | ——————– | ||||||||
| 3,725 | 4,120 | ||||||||
| =========== | =========== | ||||||||
| Number of persons | 13 | 14 | |||||||
| =========== | =========== | ||||||||
| No remuneration were paid to Chief Executive and/or Directors of the Company. The Chief Executive | |||||||||
| has voluntarily decided not to accept any remuneration for the year ended June 30, 1999. | |||||||||
| 17. AGGREGATE TRANSACTIONS WITH | |||||||||
| HOLDING COMPANY | |||||||||
| Sale of power | 312,479 | 229,427 | |||||||
| Rent | 278 | 278 | |||||||
| 18. PRODUCTION CAPACITY | |||||||||
| MWHS | |||||||||
| Installed Capacity (330 days) | |||||||||
| Main generators | 247,199 | 247,199 | |||||||
| Stand by generator | 41,199 | 41,199 | |||||||
| Actual generation | 99,449 | 85,297 | |||||||
| Reason for short fall: Lack of demand. | |||||||||
| 19. EARNING PER SHARE | |||||||||
| There is no dilutive effect on the basic earning per share of the company which is based on: | |||||||||
| Profit after tax (Rs. in million) | 30,523 | ||||||||
| Weighted average number of Ordinary shares | 20,000,000 | ||||||||
| Earning per share (Rupees) | 1.53 | ||||||||
| 20. FINANCIAL INSTRUMENTS AND | |||||||||
| RELATED DISCLOSURES | |||||||||
| Concentration of credit risk | |||||||||
| Credit risk represents the accounting loss that would be recognized at the reporting date if | |||||||||
| counter parties failed completely to perform as contracted. The Company applies credit limits to | |||||||||
| its customers and does not have significant exposure to any individual customer. | |||||||||
| Interest rate risk | |||||||||
| Interest rate risk arise from the possibility that change in interest rates will effect the value of | |||||||||
| financial instruments. The Company is not exposed to interest rate risk. | |||||||||
| Fair values of financial instruments | |||||||||
| The carrying value of all the financial instruments reported in the financial statements approximate | |||||||||
| their value. | |||||||||
| 21. OWNERS’ EQUITY | |||||||||
| Movements in owner’s equity during the year are identified and adequately disclosed in the | |||||||||
| financial statements. | |||||||||
| 22. GENERAL | |||||||||
| Figures have been rounded off to the nearest thousand of rupees. | |||||||||
| Corresponding figures have been rearranged and/or regrouped, wherever necessary for the | |||||||||
| purpose of comparison. | |||||||||
| Total number of employees at the year end are 36. | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| Consolidated Accounts | |||||||||
| AUDITORS’ REPORT TO THE MEMBERS | |||||||||
| We have examined the annexed consolidated financial statements comprising consolidated Balance | |||||||||
| Sheet of LUCKY CEMENT LIMITED and its subsidiary company LUCKY POWERTECH | |||||||||
| LIMITED as at June 30, 1999 and the related consolidated Profit and Loss Account and Consolidated | |||||||||
| Cash Flow Statement together with the notes forming part thereof, for the year ended June 30, | |||||||||
| 1999. We have also expressed separate opinions on the financial statements of Lucky Cement | |||||||||
| Limited and its subsidiary company. These financial statements are the responsibility of the Holding | |||||||||
| Company’s management. Our responsibility is to express an opinion on these financial statements | |||||||||
| based on our examination. | |||||||||
| Our examination was made in accordance with International Standards on Auditing and accordingly | |||||||||
| included such tests of accounting records and such other auditing procedures as we considered | |||||||||
| necessary in the circumstances. | |||||||||
| In our opinion the consolidated financial statements examined by us present fairly the financial | |||||||||
| position of Lucky Cement Limited and its subsidiary company as at June 30, 1999 and the results of | |||||||||
| their operations for the year then ended. | |||||||||
| M.YOUSUF ADIL SALEEM & CO., | |||||||||
| Karachi: December 7, 1999 | Chartered Accountants | ||||||||
| CONSOLIDATED BALANCE SHEET AS AT JUNE 30, 1999 | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in “000” | |||||||||
| SHARE CAPITAL AND RESERVE | |||||||||
| Authorized capital | |||||||||
| 300,000,000 Ordinary shares | |||||||||
| of Rs. 10/: each | 3,000,000 | 3,000,000 | |||||||
| =========== | =========== | ||||||||
| Issued, subscribed and paid-up capital | |||||||||
| 245,000,000 Ordinary shares of Rs. 10/: each | |||||||||
| fully paid in cash | 2,450,000 | 2,450,000 | |||||||
| Capital reserve | |||||||||
| Share premium | 990,000 | 990,000 | |||||||
| Accumulated loss | (133,970) | (219,924) | |||||||
| ——————– | ——————– | ||||||||
| 3,306,030 | 3,220,076 | ||||||||
| LONG TERM LOANS | 3 | 605,118 | 742,601 | ||||||
| LIABILITIES AGAINST ASSETS SUBJECT | |||||||||
| TO FINANCE LEASE | 4 | 97,793 | 192,848 | ||||||
| DEFERRED LIABILITIES | 5 | 116,529 | 230,196 | ||||||
| LONG TERM DEPOSITS | 6 | 16,139 | 19,234 | ||||||
| CURRENT LIABILITIES | |||||||||
| Short term finance | 7 | 175,143 | 221,156 | ||||||
| Short term loan – unsecured and interest free | |||||||||
| Associated Undertaking | 45,000 | – | |||||||
| Current portion of long term liabilities | 8 | 221,327 | 176,503 | ||||||
| Creditors, accrued and other liabilities | 9 | 320,255 | 192,449 | ||||||
| Provision for taxation | 7,000 | 7,000 | |||||||
| ——————– | ——————– | ||||||||
| 768,725 | 597,108 | ||||||||
| CONTINGENCIES AND COMMITMENTS | 10 | – | – | ||||||
| ——————– | ——————– | ||||||||
| 4,910,334 | 5,002,063 | ||||||||
| =========== | =========== | ||||||||
| FIXED ASSETS – TANGIBLE | |||||||||
| Operating assets | 11 | 4,445,408 | 4,590,869 | ||||||
| Capital work-in-progress | 12 | 5,591 | 17,805 | ||||||
| ——————– | ——————– | ||||||||
| 4,450,999 | 4,608,674 | ||||||||
| LONG TERM DEPOSITS AND | |||||||||
| DEFERRED COSTS | 13 | 65,055 | 75,946 | ||||||
| CURRENT ASSETS | |||||||||
| Stores and spares | 14 | 183,663 | 130,426 | ||||||
| Stock-in-trade | 15 | 65,735 | 63,125 | ||||||
| Trade debtors | 5,681 | – | |||||||
| Advances, deposits, prepayments and | – | – | |||||||
| other receivables | 16 | 113,500 | 108,091 | ||||||
| Cash and bank, balances | 17 | 25,701 | 15,801 | ||||||
| ——————– | ——————– | ||||||||
| 394,280 | 317,443 | ||||||||
| ——————– | ——————– | ||||||||
| 4,910,334 | 5,002,063 | ||||||||
| =========== | =========== | ||||||||
| The annexed notes from I to 30 form an integral part of these accounts. | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| CONSOLIDATED PROFIT AND LOSS ACCOUNT | |||||||||
| FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in “000” | |||||||||
| Sales – net | 18 | 1,474,964 | 1,010,006 | ||||||
| Cost of sales / generation | 19 | 1,121,022 | 901,715 | ||||||
| ——————– | ——————– | ||||||||
| Gross profit | 353,942 | 108,291 | |||||||
| Operating expenses | |||||||||
| Administrative | 20 | 39,195 | 48,451 | ||||||
| Selling and distribution | 21 | 14,332 | 10,551 | ||||||
| ——————– | ——————– | ||||||||
| 53,527 | 59,002 | ||||||||
| ——————– | ——————– | ||||||||
| 300,415 | 49,289 | ||||||||
| Operating profit | — | — | |||||||
| Other income | 22 | 3 4 8 | 351 | ||||||
| ——————– | ——————– | ||||||||
| 300,763 | 49,640 | ||||||||
| Financial charges | 23 | 210,28 6 | 193,199 | ||||||
| Workers’ profit participation fund | 4,523 | – | |||||||
| ——————– | ——————– | ||||||||
| 214,809 | 193,199 | ||||||||
| ——————– | ——————– | ||||||||
| Profit / (loss) before taxation | 85,954 | (143,559) | |||||||
| Provision for taxation | – | (5,000) | |||||||
| ——————– | ——————– | ||||||||
| Net Profit/(loss) after taxation | 85,954 | (148,559) | |||||||
| Accumulated loss brought forward | (219,924) | (71,365) | |||||||
| ——————– | ——————– | ||||||||
| Accumulated loss carried forward | (133,970) | (219,924) | |||||||
| =========== | =========== | ||||||||
| Earning per share | 27 | 0.35 | |||||||
| The annexed note from 1 to 30 from an integral part of these accounts. | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| CONSOLIDATED STATEMENT OF CHANGES IN FINANCIAL POSITION | |||||||||
| (CASH FLOW STATEMENT) FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| A. CASH FROM OPERATING ACTIVITIES | |||||||||
| Profit / (loss) before taxation | 85,954 | (143,559) | |||||||
| Adjustments for: | |||||||||
| Depreciation | 195,705 | 173,774 | |||||||
| Amortization of deferred cost | 11,901 | 11,698 | |||||||
| (Gain) / loss on disposal of fixed assets | 24 | (232) | |||||||
| Provision for gratuity | 2,283 | 2,535 | |||||||
| Payment for gratuity | (345) | — | |||||||
| Financial charges | 210,286 | 193,199 | |||||||
| ——————– | ——————– | ||||||||
| Operating profit before working capital changes | 505,808 | 237,415 | |||||||
| Changes in working capital: | |||||||||
| (Increase) / decrease in current assets | |||||||||
| Stores and spares | (53,237) | 8,533 | |||||||
| Stock in trade | (2,610) | (28,847) | |||||||
| Trade debtors | (5,681) | 37 | |||||||
| Advances, deposits, prepayments | |||||||||
| and other receivables | (5,409) | (80,867) | |||||||
| Increase / (Decrease) in current liabilities | |||||||||
| Creditors, accrued and other liabilities | 24,781 | 113,623 | |||||||
| ——————– | ——————– | ||||||||
| Cash generated from operation | 463,652 | 249,894 | |||||||
| Financial charges paid | (164,659) | (227,534) | |||||||
| ——————– | ——————– | ||||||||
| Net cash from operating activities | 298,993 | 22,360 | |||||||
| ——————– | ——————– | ||||||||
| B. CASH FROM INVESTING ACTIVITIES | |||||||||
| Fixed capital expenditure | (38,093) | (173,387) | |||||||
| Sales proceed of fixed assets | 38 | 35,885 | |||||||
| Long term deposits | – | (1,750) | |||||||
| Deferred costs | (1,010) | (122) | |||||||
| ——————– | ——————– | ||||||||
| Net cash used in investing activities | (39,065) | (139,374) | |||||||
| ——————– | ——————– | ||||||||
| C. CASH FROM FINANCING ACTIVITIES | |||||||||
| Long term loan paid | (79,560) | (35,570) | |||||||
| Lease finances obtained | 35,000 | ||||||||
| Lease finances paid | (67,664) | (38,145) | |||||||
| Deferred liabilities | (53,699) | 45,769 | |||||||
| Long term deposits | (3,095) | (5,533) | |||||||
| ——————– | ——————– | ||||||||
| Net cash used in investing activities | (204,018) | 1,521 | |||||||
| ——————– | ——————– | ||||||||
| Net decrease in cash and cash equivalents (A+B+C) | 55,910 | (115,493) | |||||||
| Cash and cash equivalent at the beginning of the year | (205,352) | (89,859) | |||||||
| ——————– | ——————– | ||||||||
| Cash and cash equivalent at the end of the year | (149,442) | (205,352) | |||||||
| =========== | =========== | ||||||||
| Cash and cash equivalent | |||||||||
| Cash and bank balances | 25,701 | 15,801 | |||||||
| Short term finance | (175,143) | (221,156) | |||||||
| ——————– | ——————– | ||||||||
| 149,442 | 205,355 | ||||||||
| =========== | =========== | ||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | |||||||||
| FOR THE YEAR ENDED JUNE 30, 1999 | |||||||||
| 1. THE GROUP AND ITS OPERATIONS | |||||||||
| Lucky Cement Limited, the parent company and its wholly owned subsidiary company, Lucky | |||||||||
| Powertech Limited are incorporated in Pakistan as public limited companies under the Companies | |||||||||
| Ordinance, 1984. The shares of the parent company are quoted on the stock exchanges of Pakistan | |||||||||
| and its principal business is manufacture and sale of cement. The subsidiary company is unquoted | |||||||||
| and its principal business is generation and sale of electricity. Both parent and subsidiary companies | |||||||||
| are located at District Lakki Marwar N.W.F.P. | |||||||||
| 2. SIGNIFICANT ACCOUNTING POLICIES | |||||||||
| 2.1 Basis of consolidation | |||||||||
| The consolidated financial statements include the accounts of Lucky Cement Limited, the | |||||||||
| parent company and its subsidiary company, Lucky Powertech Limited. The subsidiary | |||||||||
| company is wholly owned by parent company in lieu of its 100% equity ownership. Material | |||||||||
| inter-company transactions are eliminated in the consolidated financial statements. | |||||||||
| 2.2 Accounting convention | |||||||||
| These consolidated financial statements have been prepared under the ‘historical cost | |||||||||
| convention. | |||||||||
| 2.3 Staff retirement benefits | |||||||||
| The parent and subsidiary company operate an unfunded gratuity scheme for all their | |||||||||
| employees. Annual provisions are made in the accounts to cover this liability. | |||||||||
| 2.4 Taxation | |||||||||
| Current | |||||||||
| Provision for current taxation of the parent company is based on taxable income at the | |||||||||
| current rates of tax after taking into account tax rebates and credits available, if any. | |||||||||
| Deferred | |||||||||
| The parent company accounts for deferred tax on all material timing differences using the | |||||||||
| liability method. However, deferred tax is not provided if it can be established with reasonable | |||||||||
| certainty that these timing differences will not reverse in the foreseeable future. | |||||||||
| 2.5 Fixed assets and depreciation | |||||||||
| Operating assets | |||||||||
| These are stated at cost less accumulated depreciation except free hold land which is | |||||||||
| stated at cost. | |||||||||
| Depreciation is charged to income applying the straight line method on building and quarry | |||||||||
| equipment and on written down value on all other assets at the rates mentioned in the | |||||||||
| relevant note. On plant and machinery depreciation is charged on units of production method | |||||||||
| based on higher of estimated life and production. | |||||||||
| Full year’s depreciation is charged on additions while no depreciation is charge on assets | |||||||||
| deleted during the year. However, capatilization of project cost is depreciated proportionately | |||||||||
| for the period of use. Upto the year 1997-98 depreciation on Vehicle, Furniture and Fixture, | |||||||||
| Office equipment and other assets was recorded on straight line method. Due to this change, | |||||||||
| depreciation for the year has been reduced by Rs. 3.5 million. | |||||||||
| Maintenance and normal repairs are charged to income as and when incurred. Major | |||||||||
| renewals and improvements are capitalized. | |||||||||
| Gains and losses on disposal of assets, if any, are included in income currently. | |||||||||
| Assets subject to finance lease | |||||||||
| Assets subject to finance lease are stated at the lower of present value of minimum lease | |||||||||
| payments under the lease agreements or fair value of the assets. The related obligations of | |||||||||
| the lease are accounted for as liabilities. Assets acquired under the finance lease are | |||||||||
| depreciated at the rate specified in relevant note. | |||||||||
| 2.6 Capital work in progress | |||||||||
| All cost/expenditure directly related to specific assets incurred during project implementation | |||||||||
| period are carried under this head. These are transferred to specific assets as and when | |||||||||
| assets are available for use. | |||||||||
| 2.7 Deferred Costs | |||||||||
| Deferred cost is amortized over a maximum period of five years beginning from the year of | |||||||||
| deferment. | |||||||||
| 2.8 Stores and spares | |||||||||
| These are valued at moving average cost. Items in transit are stated at cost accumulated | |||||||||
| upto the balance sheet date. | |||||||||
| 2.9 Stock in trade | |||||||||
| These are valued at lower of cost or net realizable value. Cost signifies in relation to raw | |||||||||
| and packing material at average cost. In case of work in process and finished goods at | |||||||||
| average cost comprising prime cost and appropriate manufacturing overhead. | |||||||||
| 2.10 Foreign Currency Transactions | |||||||||
| Assets and liabilities in foreign currencies are translated into Pak Rupees at the rates of | |||||||||
| exchange prevailing at the balance sheet date, except those covered under the forward | |||||||||
| exchange contracts which are translated at cover rate. Exchange gains and losses on translation | |||||||||
| are included is income currently. | |||||||||
| 2.11 Revenue Recognition | |||||||||
| Sales of the parent company are recorded on despatch of goods to customers. Energy sales | |||||||||
| of the subsidiary company are recognized on the basis of electricity supplied to the consumer. | |||||||||
| Note | 1999 | 1998 | |||||||
| Amount in ‘000’ | |||||||||
| 3. LONG TERM LOANS | |||||||||
| Secured | |||||||||
| Banking Company | |||||||||
| Demand Finance – I | 3.1 | 599,000 | 670,500 | ||||||
| Demand Finance – II | 3.1 | 60,400 | 60,400 | ||||||
| Investment Bank | 3.2 | 29,440 | 37,500 | ||||||
| Unsecured | |||||||||
| Sponsors | 3.3 | 14,300 | 59,300 | ||||||
| ——————- | ——————- | ||||||||
| 703,140 | 827,700 | ||||||||
| Less: payable within one year shown | |||||||||
| Under current liabilities | (98,022) | (85,099) | |||||||
| ——————- | ——————- | ||||||||
| 605,118 | 742,601 | ||||||||
| =========== | =========== | ||||||||
| 3.1 This loan is secured against first charge by way of equitable mortgage on the fixed assets, | |||||||||
| floating charge on book debts and hypothecation on plant / machinery and equipment | |||||||||
| other than of Line ‘A’ and quarry equipments. The sanctioned amount of loan is | |||||||||
| Rs. 756.236 million and is repayable is monthly installments. The mark up rate of these | |||||||||
| finances is 45 paisas per Rs. 1,000/- per day. | |||||||||
| 3.2 This. loan is secured against second charge upto Rs. 68 million on the plant and equipment | |||||||||
| other than of Line ‘A’. This loan is repayable in monthly installments and will be paid in | |||||||||
| full by October 2000. The rate of mark up is 21% per annum. | |||||||||
| 3.3 The loan related to parent company has been transferred to short term loan. | |||||||||
| 4. LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE | |||||||||
| Opening balance | 284,252 | 287,397 | |||||||
| Transferred / obtained during the year | 4,510 | 35,000 | |||||||
| ——————- | ——————- | ||||||||
| 288,762 | 322,397 | ||||||||
| Paid during the year | (67,664) | (38,145) | |||||||
| ——————- | ——————- | ||||||||
| 221,098 | 284,252 | ||||||||
| Payable within one year shown under | |||||||||
| Current liabilities | (123,305) | (91,404) | |||||||
| ——————- | ——————- | ||||||||
| 97,793 | 192,848 | ||||||||
| =========== | =========== | ||||||||
| 4.1 Liabilities against assets subject to finance lease represent liabilities for finances obtained | |||||||||
| under sale and lease back arrangements from a commercial bank and leasing companies. | |||||||||
| Effective from June 1999 the discounting rate of bank is reduced to 15% from previous | |||||||||
| rates of 21% and 18.5%. Approximate discounting rate of leasing companies is 21%. | |||||||||
| 4.2 The amount of future lease payments to which the Company is committed as at June 30, | |||||||||
| 1999 are as under: | |||||||||
| Amount in ‘000’ | |||||||||
| Year ending June 30 | |||||||||
| 2000 | 141,675 | ||||||||
| 2001 | 100,970 | ||||||||
| 2002 | 13,055 | ||||||||
| 2003 | 11,467 | ||||||||
| ——————- | |||||||||
| 267,167 | |||||||||
| Less: Finance charges allocated to future period | (46,069) | ||||||||
| ——————- | |||||||||
| 221,098 | |||||||||
| =========== | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 5. DEFERRED LIABILITIES | |||||||||
| Staff gratuity | 9,207 | 7,269 | |||||||
| Retention money | |||||||||
| Contractors – local | 5.1 | – | 49,552 | ||||||
| Plant and machinery – foreign supplier | 5.2 | 11,477 | 77,065 | ||||||
| Encashment of performance | – | ||||||||
| guarantee (US$ 1,313,250) | 5.2 | 56,179 | 56,179 | ||||||
| Accrued markup | 39,666 | 40,131 | |||||||
| ——————- | ——————- | ||||||||
| 116,529 | 230,196 | ||||||||
| =========== | =========== | ||||||||
| 5.1 This represented retention money of local contractors of parent company. The balance | |||||||||
| amount is transferred to current liabilities. | |||||||||
| 5.2 These represent net retention money and proceed of encashment of performance | |||||||||
| guarantee. The encashment amount of performance guarantee is valued at conversion | |||||||||
| rate prevailing at the date of encashment. These amounts are likely to be settled against | |||||||||
| the claims made by the parent company (refer note # 10.2). | |||||||||
| 6. LONG TERM DEPOSITS – Unsecured | |||||||||
| Cement Stockists | 6.1 | 4,109 | 6,704 | ||||||
| Transporters | 6.2 | 11,900 | 12,400 | ||||||
| Others | 130 | 130 | |||||||
| ——————- | ——————- | ||||||||
| 16,139 | 19,234 | ||||||||
| =========== | =========== | ||||||||
| 6.1 These represent interest free security deposits received from Stockists and are repayable | |||||||||
| on cancellation or withdrawal of stockistship and adjustable with unpaid amount of sales. | |||||||||
| 6.2 These represent interest free security deposits received from transporters and are repayable | |||||||||
| on cancellation or withdrawal of contracts. | |||||||||
| 7. SHORT TERM FINANCES – Secured | 175,143 | 221,156 | |||||||
| =========== | =========== | ||||||||
| 7.1 These represents running finance facilities of the parent company from commercial banks. | |||||||||
| The amount sanctioned is Rs. 230 million. These facilities are subject to average mark-up | |||||||||
| @ 15% p.a. and are secured by way of charge on stores and spares and assets ranking | |||||||||
| pari passu with the charge created to secure long term loans. | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 8. CURRENT PORTION OF LONG TERM LIABILITIES | |||||||||
| Long term loans | 85,099 | 98,022 | |||||||
| Liabilities against assets subject to finance lease | 91,404 | 123,305 | |||||||
| ——————- | ——————- | ||||||||
| 221,327 | 176,503 | ||||||||
| =========== | =========== | ||||||||
| 9. CREDITORS, ACCRUED AND OTHER LIABILITIES | |||||||||
| Creditors | 117,951 | 101,098 | |||||||
| Accrued expenses | 14,530 | 16,929 | |||||||
| Advance from associated undertaking | 13,524 | – | |||||||
| Markup on secured long term loans | |||||||||
| and short term finances | 92,827 | 51,245 | |||||||
| Advances from customers | 7,588 | 12,943 | |||||||
| Retention money | 65,314 | 5,790 | |||||||
| Workers’ profit participation fund | 4,523 | – | |||||||
| Withholding taxes | 380 | 674 | |||||||
| Others | 3,618 | 3,770 | |||||||
| ——————- | ——————- | ||||||||
| 320,255 | 192,449 | ||||||||
| =========== | =========== | ||||||||
| 10. CONTINGENCIES AND COMMITMENTS | |||||||||
| Contingencies | |||||||||
| 10.1 Under SRO 484( 1 )/92 dated May 14, 1992 the plant and machinery not being manufactured | |||||||||
| locally was exempt from custom duty and sales tax, if imported before June 30, 1995. The | |||||||||
| Company obtained certificates from the Ministry of Industries and Central Board of | |||||||||
| Revenue (CBR) that the machinery being imported was not manufactured locally. In | |||||||||
| April 1995 the Central Board of Revenue advised the Custom authorities that the local | |||||||||
| industry was capable of manufacturing some of the equipment being imported by the | |||||||||
| Company and that exemption from custom duty and sales tax on such equipments be | |||||||||
| · denied. The Company has filed a writ petition against CBR’s instructions before the | |||||||||
| Peshawar High Court. The High Court was pleased to grant an ad interim injunction | |||||||||
| which was later on confirmed. The amount of levy is not ascertained at this stage. The | |||||||||
| case is pending with Peshawar High Court for final decision. | |||||||||
| 10.2 The company has field suits against the supplier of main plant and machinery in the Sindh | |||||||||
| High Court, Karachi on account of uneconomical operation, short supply of equipment and | |||||||||
| parts and supply of sub-standard/defective parts etc. The suits are pending with the High | |||||||||
| Court and the total amount of these claims are not determinable in monetary terms at this | |||||||||
| stage. | |||||||||
| 10.3 In January, 1995, the Chinese Supplier of the plant sent a shipment of certain equipment | |||||||||
| by air which were found to be short supplied at the time of erection. Since the equipment | |||||||||
| were part and parcel of the main plant, the supply was made free of charge. The custom | |||||||||
| authorities however, assessed the equipment to duties and taxes of Rs. 20,830,226/- which | |||||||||
| was paid in full. The Company disputed this levy and filed an appeal before the Customs, | |||||||||
| Excise and Sales Tax Appellate Tribunal. The Tribunal has set aside the impugned | |||||||||
| assessment, waived the fine and penalty of Rs. 3,650,000/- and Rs. 1,000,000/- respectively | |||||||||
| and directed the custom authorities to re-determine the value of the goods and assess the | |||||||||
| same at concessional rate of duty @ 25% of tariff rate as per SRO No.978(1)/95 dated | |||||||||
| October 4, 1995. | |||||||||
| 10.4 The Income Tax department has filed an appeal before the Income Tax Appellate Tribunal | |||||||||
| against an order passed by the Commission (Appeals) in favour of the Company with | |||||||||
| respect to levy of tax amounting to Rs. 85 million on certain pre operational earnings for | |||||||||
| the assessment years 1994-95, 1995-96 and 1996-97. No liability has been accounted for | |||||||||
| in these accounts in lieu of the relief granted by the Commissioner (Appeals). | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| Commitments in respect of | |||||||||
| Letters of credit | 21,279 | 12,600 | |||||||
| 11. OPERATING ASSETS | |||||||||
| Cost at | Cost at | Accumulated | Depreciation/ | Rate | Accumulated | Book value | |||
| Particulars | Jul-01 | Addition/ | Jun-30 | depreciation | adjustment | % | depreciation at | at June30 | |
| 1998 | (disposal) | 1999 | at July 01 1998 | for the year | p.a. | June30,1999 | 1999 | ||
| Owned | |||||||||
| Land-free hold | 5,309 | 56 | 5,365 | — | — | — | — | 5,365 | |
| Building on free hold Land | 880,014 | 13,946 | 893,960 | 47,796 | 44,699 | 5 | 92,495 | 801,465 | |
| Plant and machinery | 3,357,003 | 32,769 | 3,389,772 | 139,718 | 121,459 | UPM | 261,177 | 3,128,595 | |
| Quary equipment | 183,417 | 1,306 | 184,723 | 13,755 | 9,606 | 5 | 23,361 | 161,362 | |
| Vehicles | 18,088 | 393 | 18,481 | 11,521 | 1,392 | 20 | 12,913 | 5,568 | |
| Furniture and fixtures | 5,556 | 14 | 5,570 | 1,785 | 393 | 10 | 2,178 | 3,392 | |
| Office equipment | 20,315 | 718 | 20,908 | 6,347 | 1,504 | 10 | 7,789 | 13,119 | |
| (125) | (62) | ||||||||
| Other assets | 10,404 | 1,104 | 11,508 | 909 | 10 | 3,588 | 7,920 | ||
| ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ||
| 4,480,106 | 50,306 | 4,530,287 | 223,601 | 179,962 | 408,501 | 4,126,786 | |||
| (62) | |||||||||
| Leased | |||||||||
| Plant and machinery | 355,639 | — | 355,639 | 22,236 | 15,532 | UPM | 37,858 | 317,781 | |
| Vehicles | 1,754 | — | 1,754 | 702 | 210 | 20 | 912 | 842 | |
| ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ||
| 357,393 | — | 357,393 | 23,028 | 15,742 | 38,770 | 318,623 | |||
| ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ——————– | ||
| 1999 (Rupees in “000”) | 4,837,499 | 50,306 | 4,887,680 | 246,629 | 195,704 | 442,271 | 4,445,408 | ||
| (125) | (62) | ||||||||
| =========== | =========== | =========== | =========== | =========== | =========== | =========== | =========== | ||
| 1998 (Rupees in “000”) | 4,490,359 | 383,001 | 4,075,370 | 73,444 | 173,774 | 246,630 | 4,590,869 | ||
| (36,113) | (588) | ||||||||
| =========== | =========== | =========== | =========== | =========== | =========== | =========== | =========== | ||
| UPM= Unit of production method | |||||||||
| 1999 | 1998 | ||||||||
| Amount in “000” | |||||||||
| 11.1 A portion of land has been leased for twenty years to Lucky Powertech Limited, a wholly | |||||||||
| owned subsidiary company, for Power Plant. | |||||||||
| 11.2 Depreciation charge for the year has been allocated as follows: | |||||||||
| Cost of sales | 192,103 | 166,175 | |||||||
| Administrative expenses | 3,449 | 7,416 | |||||||
| Selling expenses | 15 3 | 183 | |||||||
| ——————– | ——————– | ||||||||
| 195,705 | 173,774 | ||||||||
| =========== | =========== | ||||||||
| 11.3 Disposal of assets | |||||||||
| Particulars | Cost | Book | Sale | Mode of | Particulars | ||||
| Value | Proceeds | Disposal | of Buyers | ||||||
| Office equipment | 125 | 63 | 38 | Trade in | Khan Office Products, Karachi. | ||||
| ——————– | ——————– | ——————– | |||||||
| 1999 (Rupees ‘000’) | 125 | 63 | 38 | ||||||
| ——————– | ——————– | ——————– | |||||||
| 1998 (Rupees ‘000’) | 36,112 | 35,885 | 35,885 | ||||||
| =========== | =========== | =========== | |||||||
| 12 CAPITAL WORK-IN-PROGRESS – at cost | |||||||||
| Building and civil works | 5,310 | 14,659 | |||||||
| Plant and Machinery – Local | – | 1,990 | |||||||
| Quarry development | – | 1,018 | |||||||
| Electrification | 281 | 100 | |||||||
| Mechanical erection and installation | – | 38 | |||||||
| ——————– | ——————– | ||||||||
| 5,591 | 17,805 | ||||||||
| =========== | =========== | ||||||||
| 13. LONG TERM DEPOSITS AND | |||||||||
| DEFERRED COSTS | |||||||||
| Long term lease deposits | 34,988 | 34,988 | |||||||
| Deferred costs | |||||||||
| Preliminary expenses | 2,819 | 2,819 | |||||||
| Expenses on issue of shares | 41,046 | 41,046 | |||||||
| Quarry development costs | 13,145 | 12,135 | |||||||
| Other deferred costs | 2,493 | 2,493 | |||||||
| ——————– | ——————– | ||||||||
| 59,503 | 58,493 | ||||||||
| Less · Amortization of deferred costs | (29,436) | (17,535) | |||||||
| ——————– | ——————– | ||||||||
| 30,067 | 40,958 | ||||||||
| ——————– | ——————– | ||||||||
| 65,055 | 75,946 | ||||||||
| =========== | =========== | ||||||||
| 14. STORES AND SPARES | |||||||||
| Stores | 38,939 | 39,775 | |||||||
| Spares | 130,319 | 87,417 | |||||||
| Spares in transit | 14,405 | 3,234 | |||||||
| ——————– | ——————– | ||||||||
| 183,663 | 130,426 | ||||||||
| =========== | =========== | ||||||||
| 15. STOCK-IN-TRADE | |||||||||
| Raw’ and packing material | 8,358 | 7,659 | |||||||
| Work in process | 49,867 | 19,774 | |||||||
| Finished goods | 7,510 | 35,692 | |||||||
| ——————– | ——————– | ||||||||
| 65,735 | 63,125 | ||||||||
| =========== | =========== | ||||||||
| 16. ADVANCES, DEPOSITS, PREPAYMENTS | |||||||||
| AND OTHER RECEIVABLES | |||||||||
| Loans and advances | |||||||||
| Employees | 1,447 | 1,650 | |||||||
| Advance income tax | 49,391 | 40,889 | |||||||
| Excise duty | 2,694 | 865 | |||||||
| Advance to suppliers and others | 23,873 | 32,252 | |||||||
| ——————– | ——————– | ||||||||
| 77,405 | 75,656 | ||||||||
| Deposits and prepayments | |||||||||
| Deposits | 4,876 | 4,894 | |||||||
| Prepayments | 492 | 331 | |||||||
| ——————– | ——————– | ||||||||
| 5,368 | 5,225 | ||||||||
| Other receivables – Considered good | |||||||||
| Octroi refundable | 5,184 | 4,808 | |||||||
| Insurance claim | – | 330 | |||||||
| Freight | 3,743 | 102 | |||||||
| Custom duty | 20,830 | 20,830 | |||||||
| Others | 970 | 1,140 | |||||||
| ——————– | ——————– | ||||||||
| 30,727 | 27,210 | ||||||||
| ——————– | ——————– | ||||||||
| 113,500 | 108,091 | ||||||||
| =========== | =========== | ||||||||
| 17. CASH AND BANK BALANCES | |||||||||
| Bank balances | |||||||||
| Current accounts | 25,046 | 14,637 | |||||||
| PLS accounts | 612 | 1,118 | |||||||
| ——————– | ——————– | ||||||||
| 25,658 | 15,755 | ||||||||
| Cash in hand | 43 | 46 | |||||||
| ——————– | ——————– | ||||||||
| 25,701 | 15,801 | ||||||||
| =========== | =========== | ||||||||
| 18. SALES – net | |||||||||
| Sales | 2,542,973 | 1,791,561 | |||||||
| Less · Excise duty | 1,063,138 | 776,123 | |||||||
| Loading and other charges | 4,871 | 5,432 | |||||||
| ——————– | ——————– | ||||||||
| 1,068,009 | 781,555 | ||||||||
| ——————– | ——————– | ||||||||
| 1,474,964 | 1,010,006 | ||||||||
| =========== | =========== | ||||||||
| 19. COST OF SALES / GENERATION | |||||||||
| Raw material | 23,745 | 20,211 | |||||||
| Chemical | 868 | 2,574 | |||||||
| Packing material | 167,948 | 122,853 | |||||||
| Fuel, oil and lubricant | 551,039 | 454,100 | |||||||
| Stores and spares | 47,098 | 36,174 | |||||||
| Salaries and wages | 68,631 | 64,854 | |||||||
| Repairs and maintenance | 9,055 | 8,585 | |||||||
| Depreciation | 192,103 | 166,175 | |||||||
| Insurance | 41,09 6 | 29,593 | |||||||
| Amortization of quarry development | 2,629 | 2,427 | |||||||
| Other manufacturing expenses | 18,721 | 18,221 | |||||||
| ——————– | ——————– | ||||||||
| 1,122,933 | 925,767 | ||||||||
| Work-in-process | |||||||||
| Opening | 19,774 | 22,903 | |||||||
| Closing | (49,867) | (19,774) | |||||||
| ——————– | ——————– | ||||||||
| (30,093) | 3,969 | ||||||||
| ——————– | ——————– | ||||||||
| Cost of goods manufactured | 1,092,840 | 929,736 | |||||||
| Finished goods | |||||||||
| Opening | 35,692 | 7,671 | |||||||
| Closing | ( 7,510 ) | (35,692) | |||||||
| ——————– | ——————– | ||||||||
| 28,182 | (28,021) | ||||||||
| ——————– | ——————– | ||||||||
| 1,121,022 | 901,715 | ||||||||
| =========== | =========== | ||||||||
| 20. ADMINISTRATIVE EXPENSES | |||||||||
| Salaries and benefits | 11,317 | 14,091 | |||||||
| Communication | 3,324 | 3,549 | |||||||
| Amortization of deferred cost | 9,272 | 9,271 | |||||||
| Travelling and conveyance | 1,140 | 3,396 | |||||||
| Depreciation | 3,448 | 7,416 | |||||||
| Insurance | 1,229 | 94 | |||||||
| Vehicles running and maintenance | 1,026 | 876 | |||||||
| Boarding and lodging . | 417 | 436 | |||||||
| Advertisement | 357 | 1,150 | |||||||
| Printing and stationery | 764 | 1,830 | |||||||
| Security services | 253 | 620 | |||||||
| Entertainment | 377 | 201 | |||||||
| Legal and professional | 2,113 | 2,233 | |||||||
| Transportation and freight | 383 | 504 | |||||||
| Rent, rates and taxes | 720 | 752 | |||||||
| Utilities | 793 | 804 | |||||||
| Repairs and maintenance | 598 | 228 | |||||||
| Auditors remuneration | 20.1 | 223 | 150 | ||||||
| Charity and donation | 61 | 97 | |||||||
| Fees and subscription | 703 | 427 | |||||||
| Others | 677 | 326 | |||||||
| ——————– | ——————– | ||||||||
| 39,195 | 48,451 | ||||||||
| =========== | =========== | ||||||||
| 20.1 Auditors’ Remuneration | |||||||||
| Statutory audit fee | 150 | 150 | |||||||
| Cost audit fee | 60 | – | |||||||
| Out of pocket expenses | 13 | – | |||||||
| ——————– | ——————– | ||||||||
| 223 | 150 | ||||||||
| =========== | =========== | ||||||||
| 21. SELLING AND DISTRIBUTION EXPENSES | |||||||||
| Salaries and benefits | 6,972 | 4,274 | |||||||
| Communication | 2,190 | 2,522 | |||||||
| Travelling and conveyance | 455 | 389 | |||||||
| Printing and stationery | 240 | 301 | |||||||
| Utilities | 630 | 625 | |||||||
| Vehicles running and maintenance | 465 | 351 | |||||||
| Repairs and maintenance | 153 | 107 | |||||||
| Depreciation | 154 | 183 | |||||||
| Fees and subscription | 20 | 21 | |||||||
| Rent rates and taxes | 864 | 622 | |||||||
| Advertisement | 541 | 369 | |||||||
| Entertainment | 220 | 156 | |||||||
| Insurance | 276 | 33 | |||||||
| Others | 1,152 | 598 | |||||||
| ——————– | ——————– | ||||||||
| 14,332 | 10,551 | ||||||||
| =========== | =========== | ||||||||
| 22. OTHER INCOME | |||||||||
| Gain / (loss) on sale of assets | (24) | 232 | |||||||
| Miscellaneous | 372 | 119 | |||||||
| ——————– | ——————– | ||||||||
| 348 | 351 | ||||||||
| =========== | =========== | ||||||||
| 23. FINANCIAL CHARGES | |||||||||
| Mark-up on | |||||||||
| Long term loans | 122,287 | 123,214 | |||||||
| Lease finances | 48,953 | 45,273 | |||||||
| Excise duty on borrowings – prior year | 1,052 | – | |||||||
| Short term borrowings | 33,904 | 22,161 | |||||||
| Bank charges and commission | 4,090 | 2,551 | |||||||
| ——————– | ——————– | ||||||||
| 210,286 | 193,199 | ||||||||
| =========== | =========== | ||||||||
| 24. TAXATION | |||||||||
| Current | |||||||||
| Taxable income is worked out to be a tax loss. The company has not made provision for turnover | |||||||||
| tax of Rs. 7 Million u/s 80D of the Income Tax Ordinance 1979, as it has filed an appeal for | |||||||||
| allowing an exemption on account of clause 118C of the Second Schedule to the Income Tax | |||||||||
| Ordinance, 1979. | |||||||||
| Profits and gains of the subsidiary company are exempt from the levy of income tax under | |||||||||
| clause 176 of Part-I and clause 20 of Part-IV of the Second Schedule to the Income Tax | |||||||||
| Ordinance 1979. | |||||||||
| Deferred | |||||||||
| In view of tax losses available to be carried forwards there is no deferred tax liability | |||||||||
| 25. REMUNERATION OF EXECUTIVES | |||||||||
| Remuneration | 15,717 | 16,613 | |||||||
| House rent allowance | 7,100 | 7,476 | |||||||
| Utilities allowance | 1,572 | 1,662 | |||||||
| Conveyance allowance | 1,508 | 1,662 | |||||||
| ——————– | ——————– | ||||||||
| 25,897 | 27,413 | ||||||||
| =========== | =========== | ||||||||
| Number of Persons | 90 | 94 | |||||||
| =========== | =========== | ||||||||
| No remuneration were paid to Chief Executive and/or Directors of the Company. The Chief | |||||||||
| Executive has voluntarily decided not to accept any remuneration for the year ended June 30, | |||||||||
| 1998. | |||||||||
| 1999 | 1998 | ||||||||
| Metric tons | |||||||||
| 26. PRODUCTION CAPACITY | |||||||||
| Holding Company | |||||||||
| Installed capacity (330 days) | 1,320,000 | 1,320,000 | |||||||
| Actual production | 682,032 | 526,184 | |||||||
| Subsidiary Company | MWHS | ||||||||
| Installed capacity (330 days) | |||||||||
| Main generators | 247,199 | 247,199 | |||||||
| Standby generator | 41,199 | 41,199 | |||||||
| Actual generation | 99,449 | 85,297 | |||||||
| Reason for short fall: Lack of demand | |||||||||
| 27. EARNING PER SHARE | |||||||||
| There is no dilutive effect on the basic earning per share of the company which is based on:- | |||||||||
| Profit after tax (Rupees in million) | 85,954 | ||||||||
| Weighted average number of Ordinary shares | 245,000,000 | ||||||||
| Earning per share (Rupees) | 0.35 | ||||||||
| 28. FINANCIAL INSTRUMENTS | |||||||||
| AND RELATED DISCLOSURES | |||||||||
| Concentration of credit risk | |||||||||
| Credit risk represents the accounting loss that would be recognized at the reporting date if | |||||||||
| counter parties failed completely to perform as contracted. The Company applied credit limits to | |||||||||
| its customers and does not have significant exposure to any individual customer. | |||||||||
| Interest rate risk | |||||||||
| Interest rate risk arise from the possibility that changes in interest rates will effect the value of | |||||||||
| financial instruments. The Company is not exposed to interest rate risk. | |||||||||
| Fair values of financial instruments | |||||||||
| The carrying value of all the financial instruments reported in the financial statements approximate | |||||||||
| their fair value. | |||||||||
| 29. OWNERS’ EQUITY | |||||||||
| Movement in owners’ equity during the year are identified and adequately disclosed in the | |||||||||
| financial statements. | |||||||||
| 30. GENERAL | |||||||||
| Figures have been rounded off to the nearest thousand Rupees. | |||||||||
| Corresponding figures have been rearranged and/or regrouped wherever necessary for the | |||||||||
| purpose of comparison. | |||||||||
| Total number of permanent employees at the year end are 564. | |||||||||
| Muhammad Yunus Tabba | Abdul Razzak Tabba | ||||||||
| Director | Chief Executive | ||||||||
| Annual Report’ | |||||||||
| 1999 | |||||||||
| 1 | |||||||||
| LUCKY CEMENT LIMITED | |||||||||
| PATTERN OF SHAREHOLDING AS AT JUNE 30, 1999 | |||||||||
| NUMBER OF SHARE HOLDING TOTAL SHARES | |||||||||
| SHAREHOLDERS FROM TO HELD | |||||||||
| 543 | 1 | — | 100 | 54,300 | |||||
| 32,367 | 101 | — | 500 | 15,954,600 | |||||
| 442 | 501 | — | 1000 | 385,700 | |||||
| 560 | 1001 | — | 5000 | 1,680.95 | |||||
| 240 | 5001 | — | 10000 | 2,106,900 | |||||
| 72 | 10001 | — | 15000 | 941,900 | |||||
| 55 | 15001 | — | 20000 | 1,017,800 | |||||
| 40 | 20001 | — | 25000 | 971,800 | |||||
| 26 | 25001 | — | 30000 | 750,800 | |||||
| 8 | 30001 | — | 35000 | 258,500 | |||||
| 9 | 35001 | — | 40000 | 344,500 | |||||
| 2 | 40001 | — | 45000 | 89,900 | |||||
| 11 | 45001 | — | 50000 | 542,500 | |||||
| 5 | 50001 | — | 55000 | 264,900 | |||||
| 6 | 55001 | — | 60000 | 345,500 | |||||
| 1 | 60001 | — | 65000 | 62,800 | |||||
| 2 | 65001 | — | 70000 | 137,700 | |||||
| 9 | 70001 | — | 75000 | 667,500 | |||||
| 5 | 75001 | — | 80000 | 396,400 | |||||
| 2 | 80001 | — | 85000 | 164,400 | |||||
| 2 | 85001 | — | 90000 | 175,500 | |||||
| 2 | 90001 | — | 95000 | 183,400 | |||||
| 9 | 95001 | — | 100000 | 896,400 | |||||
| 2 | 105001 | — | 110000 | 214,600 | |||||
| 3 | 115001 | — | 120000 | 351,400 | |||||
| 1 | 120001 | — | 125000 | 125,000 | |||||
| 2 | 125001 | — | 130000 | 255 | |||||
| 6 | 135001 | — | 180000 | 953,000 | |||||
| 3 | 195001 | — | 200000 | 778,500 | |||||
| 2 | 205001 | — | 210000 | 413,500 | |||||
| 1 | 225001 | — | 230000 | 230,000 | |||||
| 1 | 240001 | — | 245000 | 242,000 | |||||
| 3 | 245001 | — | 250000 | 749,800 | |||||
| 2 | 265001 | — | 270000 | 537,000 | |||||
| 2 | 275001 | — | 280000 | 276,900 | |||||
| 5 | 290001 | — | 365000 | 1,631,400 | |||||
| 3 | 395001 | — | 400000 | 1,200,000 | |||||
| 1 | 400001 | — | 405000 | 404,000 | |||||
| 1 | 410001 | — | 415000 | 412,500 | |||||
| 1 | 425001 | — | 430000 | 425,800 | |||||
| 1 | 435001 | — | 440000 | 435,600 | |||||
| 1 | 440001 | — | 445000 | 442,000 | |||||
| 1 | 495001 | — | 500000 | 1,500,000 | |||||
| 3 | 535001 | — | 1345000 | 8,020,900 | |||||
| 9 | 1345001 | — | 1415000 | 4,045,200 | |||||
| 3 | 1425001 | — | 1430000 | 1,430,000 | |||||
| 1 | 1945001 | — | 1950000 | 1,949,700 | |||||
| 1 | 2065001 | — | 2070000 | 2,070,000 | |||||
| 1 | 2270001 | — | 2275000 | 2,272,720 | |||||
| 1 | 2495001 | — | 2500000 | 5,000,000 | |||||
| 2 | 2545001 | — | 2550000 | 5,100,000 | |||||
| 2 | 2575001 | — | 2580000 | 2,575,100 | |||||
| 1 | 3045001 | — | 3050000 | 6,100,000 | |||||
| 2 | 3990001 | — | 4365000 | 3,993,800 | |||||
| 1 | 3995001 | — | 3995000 | 3,999,200 | |||||
| 1 | 4360001 | — | 4365000 | 4,360,300 | |||||
| 1 | 4495001 | — | 4500000 | 4,500,000 | |||||
| 1 | 4995001 | — | 5000000 | 10,000,000 | |||||
| 1 | 6410001 | — | 6415000 | 6,411,500 | |||||
| 1 | 6695001 | — | 6700000 | 6,700,000 | |||||
| 1 | 8330001 | — | 8335000 | 8,333,350 | |||||
| 1 | 14250001 | — | 14150000 | 14,146,600 | |||||
| 1 | 19170001 | — | 19175000 | 19,171,600 | |||||
| 2 | 21210001 | — | 21215000 | 42,424,240 | |||||
| 1 | 42420001 | — | 42425000 | 42,424,240 | |||||
| ——————- | ——————- | ——————- | ——————- | ——————- | |||||
| 34,499 | 245,000,000 | ||||||||
| ——————- | ——————- | ——————- | ——————- | ——————- | |||||
| CATEGORIES OF | NUMBER OF | TOTAL | PERCENTAGE | ||||||
| SHAREHOLDERS | SHAREHOLDERS | SHARES HELD | |||||||
| Individuals | 34,428 | 86,898,920 | 35.46 | ||||||
| Investment Companies | 23 | 98,647,480 | 40.26 | ||||||
| Insurance Companies | 5 | 1,471,900 | 0.6 | ||||||
| Joint Stock Companies | 20 | 27,201,500 | 11.1 | ||||||
| Financial Institutions | 9 | 29,468,700 | 12.02 | ||||||
| Modaraba Company | 6 | 673,200 | 0.27 | ||||||
| Charitable Trust | 2 | 20,000 | 0.04 | ||||||
| Others | 6 | 618,300 | 0.25 | ||||||
| ——————- | ——————- | ——————- | |||||||
| Total | 34,499 | 2,451,100,000 | 100 | ||||||
| ——————- | ——————- | ——————- | |||||||
