Vision of today is Tomorrow's Achievement Vision of today is Tomorrow's Achievement Condensed Interim

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  • Vision of today is

    Tomorrow's Achievement

    Condensed Interim Financial Information

    for the Half Year ended December 31, 2016

    National Refinery Limited

  • NATIONAL REFINERY LIMITED NATIONAL REFINERY LIMITEDPB 1

    Contents 02 Corporate Information

    03 Directors’ Review – English

    04 Directors’ Review – Urdu

    05 Auditors’ Report

    06 Condensed Interim Balance Sheet

    07 Condensed Interim Profit & Loss Account

    08 Condensed Interim Statement of Comprehensive Income

    09 Condensed Interim Cash Flow Statement

    10 Condensed Interim Statement of Changes in Equity

    11 Notes to the Condensed Interim Financial Information

  • NATIONAL REFINERY LIMITED NATIONAL REFINERY LIMITED2 3

    Bankers

    Bank Al-Habib Limited United Bank Limited Allied Bank Limited Bank Alfalah Limited Faysal Bank Limited Habib Bank Limited National Bank of Pakistan Samba Bank Limited MCB Bank Limited Askari Bank Limited Habib Metropolitan Bank Limited

    Registered Office

    7-B, Korangi Industrial Area, P.O. Box 8228, Karachi-74900 UAN: +92-21-111-675-675 PABX: +92-21-35064981-86 +92-21-35064977-79 Fax: +92-21-35054663 +92-21-35066705 Website: www.nrlpak.com E-mail: info@nrlpak.com

    Share Registrar

    THK Associates (Pvt.) Ltd., 1st Floor, 40-C, Block 6, P.E.C.H.S., KARACHI-75400. UAN: +92-21 111-000-322 Direct: +92-21 34168270 Fax: +92-21 34168271 Email: secretariat@thk.com.pk Website: www.thk.com.pk

    Board of Directors

    Laith G. Pharaon - Chairman Alternate Director: Jamil A. Khan Wael G. Pharaon Alternate Director: Babar Bashir Nawaz Shuaib A. Malik Zaki Mohamad Mansoer Muhammad Naeem Tariq Iqbal Khan Abdus Sattar

    Chief Executive Officer

    Shuaib A. Malik

    Chief Financial Officer

    Anwar A. Shaikh

    Company Secretary

    Nouman Ahmed Usmani

    Audit Committee

    Tariq Iqbal Khan Chairman

    Abdus Sattar Member

    Babar Bashir Nawaz Member Alternate to Wael G. Pharaon

    Shaikh Ather Ahmed Secretary

    Human Resource and Remuneration (HR&R) Committee Abdus Sattar Chairman

    Babar Bashir Nawaz Member Alternate to Wael G. Pharaon

    Shuaib A. Malik Member

    Nouman Ahmed Usmani Secretary Auditors

    A. F. Ferguson & Co. Chartered Accountants

    Solicitors

    Ali Sibtain Fazli & Associates

    Corporate Information

  • NATIONAL REFINERY LIMITED NATIONAL REFINERY LIMITED2 3

    Directors’ Review

    Assalam-u-Alaikum!

    On behalf of the Board of Directors, I present a brief review of the un-audited financial statements of your Company for the half year ended December 31, 2016.

    During the period, your Company earned profit after tax of Rs. 3,968 million resulting in earnings per share of Rs. 49.62, compared to profit after tax of Rs. 2,884 million resulting in earnings per share of Rs. 36.07 in the same period last year.

    Fuel segment of the Company earned profit after tax of Rs. 1,890 million as compared to profit after tax of Rs. 119 million in the corresponding period of last year. Increase in sales volume of premier products and improved production yield contributed towards higher margins in fuel segment. Furthermore, stability in Pak Rupee vs US Dollar resulted in net exchange loss of Rs. 62 million only as compared to Rs. 222 million in same period last year. The profitability of fuel segment includes the impact of tax credit on investments on Isomerization and Diesel Hydro desulphurization projects amounting to Rs. 1,140 million.

    Recently Government decided to introduce 92 Research Octane Number (RON) Premier Motor Gasoline (PMG) and through a policy parameter directed refineries to produce 90/87 RON PMG. Oil Marketing Companies would import 92 RON PMG, blend the same with the local production and market 90/92 RON PMG. According to pricing mechanism, NRL would be entitled to 90 RON PMG price; which would be higher than present 87 RON PMG price. The difference in price between 92 and 90 RON will be payable to the Government Treasury.

    Lube Segment earned profit after tax of Rs. 2,078 million compared to Rs. 2,765 million during the same period last year. Sales volume in Lube segment increased, however, profitability was affected due to decline in lube segment product prices.

    During the period company reduced its financing facility with consortium of banks from Rs. 24.2 billion to Rs. 12.1 billion as most of the project is financed by company’s own resources. The company has obtained long term loan of Rs. 766 million in November 2016 from the above facility.

    The projects of Diesel Desulphurization and Naphtha Isomerization are progressing smoothly. Although, the mechanical completion has been delayed by six weeks, your company is making all efforts to complete the projects before 30 June, 2017.

    The Board, on behalf of all of the directors, shareholders and employees of the Company, would like to put on record its sincere gratitude to respected Chairman Attock Group of Companies, Dr. Ghaith R. Pharaon who breathed his last on January 06, 2017. It was his vision, guidance, trust and confidence which enabled a moderate business set up to become one of the leading business groups of the country and thereby contributing significantly towards economic development of the country. May Allah rest him in eternal peace and give fortitude and courage to his family to bear this loss. Ameen.

    The Board appreciates the continuous cooperation, support and confidence of all the stakeholders of the company.

    On behalf of the Board

    Rawalpindi Laith G. Pharaon January 27, 2017 Chairman

  • NATIONAL REFINERY LIMITED NATIONAL REFINERY LIMITED4 5

  • NATIONAL REFINERY LIMITED NATIONAL REFINERY LIMITED4 5

  • NATIONAL REFINERY LIMITED NATIONAL REFINERY LIMITED6 7

    CONDENSED INTERIM BALANCE SHEET AS AT DECEMBER 31, 2016

    Chief Executive Director

    The annexed notes 1 to 23 form an integral part of this condensed interim financial information.

    NATIONAL REFINERY LIMITED

    CONDENSED INTERIM BALANCE SHEET AS AT DECEMBER 31, 2016 Unaudited Audited

    December 31, June 30, Note 2016 2016

    ASSETS NON-CURRENT ASSETS

    Fixed assets 5 34,382,906 23,627,920 Long term investment - - Long term loans 6 42,327 40,918 Long term deposits 7 30,189 30,189 Retirement benefit prepayments 1,686 4,917

    34,457,108 23,703,944 CURRENT ASSETS

    Stores, spares and chemicals 826,278 907,495 Stock-in-trade 8 9,763,493 11,252,503 Trade debts 5,452,604 5,297,198 Loans and advances 9 103,671 84,718 Trade deposits and short-term prepayments 10 116,414 10,576 Interest accrued 29,933 28,778 Other receivables 304,714 504,421 Taxation - payments less provisions 398,192 - Cash and bank balances 11 9,053,335 11,870,898

    26,048,634 29,956,587 TOTAL ASSETS 60,505,742 53,660,531

    EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES

    Share capital 799,666 799,666

    Reserves 38,391,360 36,022,777

    39,191,026 36,822,443 LIABILITIES

    NON - CURRENT LIABILITIES Long-term borrowing 12 766,100 - Retirement benefit obligations 473,797 462,173 Deferred taxation 118,009 135,369

    1,357,906 597,542 CURRENT LIABILITIES

    Trade and other payables 13 19,844,449 15,030,594 Provisions 112,361 112,361 Taxation - provisions less payments - 1,097,591

    19,956,810 16,240,546 TOTAL LIABILITIES 21,314,716 16,838,088

    CONTINGENCIES AND COMMITMENTS 14

    TOTAL EQUITY AND LIABILITIES 60,505,742 53,660,531

    (Rupees in thousand)

  • NATIONAL REFINERY LIMITED NATIONAL REFINERY LIMITED6 7

    Chief Executive Director

    CONDENSED INTERIM PROFIT AND LOSS ACCOUNT FOR THE HALF YEAR ENDED DECEMBER 31, 2016 (UNAUDITED)

    NATIONAL REFINERY LIMITED

    CONDENSED INTERIM PROFIT AND LOSS ACCOUNT FOR THE HALF YEAR ENDED DECEMBER 31, 2016 (UNAUDITED)

    Note December 31, December 31, December 31, December 31, 2016 2015 2016 2015

    Gross sales 15 37,544,611 44,041,564 74,076,094 79,034,133

    Trade discounts, taxes, duties, levies and price differential 16 (10,941,092) (14,219,999) (21,736,177) (24,421,482)

    Net sales 26,603,519 29,821,565 52,339,917 54,612,651

    Cost of sales (24,133,057) (25,938,364) (47,630,230) (49,956,658)

    Gross profit 2,470,462 3,883,201 4,709,687 4,655,993

    Distribution cost (197,190) (192,591) (359,210) (341,848)

    Administrative expenses (219,919) (215,366) (412,579) (378,865)

    Other income 17 197,473 366,359 425,176 733,333

    Other operating expenses (156,044) (262,907) (300,193) (309,327)

    Operating profit 2,094,782 3,578,696 4,062,881 4,359,286

    Finance cost 18 (16,780) (40,495) (62,680) (230,242)