SHAHZAD TEXTILE MILLS LIMITED
CONTENTS
1st Quarterly Report September 30, 2017
Company’s Information
Directors’ Report - English
Directors’ Report - Urdu
Balance Sheet
Profit and Loss Account
Statement of Comprehensive Income
Cash Flow Statement
Statement of Changes in Equity
Notes to the Accounts
1
2
3
4
5
6
7
8
9-11
SHAHZAD TEXTILE MILLS LIMITED01
COMPANY’S INFORMATION
1st Quarterly Report September 30, 2017
Board of Directors
Mian Parvez Aslam Chairman
Mr. Imran Aslam Chief Executive
Mr. Irfan Aslam
Syed Raza Ali Bokhari
Mr. Humayun Bakht
Mr. Ahsan Ahmad Khan
Mr. Maqsood Shahid Najmi
Chief Financial Officer
Mr. Humayun Bakht
Company Secretary
Mr. Hassan-ud-Din Ansari
Auditors Horwath Hussain Chaudhry & Co. Chartered Accountants
Audit Committee
Syed Raza Ali Bokhari Chairman
Mr. Irfan Aslam Member
Mr. Maqsood Shahid Najmi Member
Human Resource &
Remuneration Committee
Syed Raza Ali Bokhari Chairman
Mr. Imran Aslam Member
Mr. Ahsan Ahmad Khan Member
Bankers
Habib Metropolitan Bank Ltd.J S Bank Ltd.National Bank of Pakistan.Meezan Bank Limited.United Bank Limited.Bank Al-Falah (Islamic Banking)
Share Registrar Hameed Majeed Associates (Pvt) Ltd.H.M. House, 7-Bank Square, Lahore.
Registered Office19-A Off. Zafar Ali Road,Gulberg-V, Lahore.Ph: +92 (42) 35754024-27Fax: +92 (42) 35712313E-mail: [email protected]: www.shahzadtex.com
MillsUnits # 1,3 & 434th KM Lahore Sheikhupura Road,Sheikhupura
Unit # 27th KM Sheikhupura FaisalabadRoad, Sheikhupura.
1st Quarterly Report September 30, 2017
CONDENSED INTERIM FINANCIAL INFORMATION
OF
SHAHZAD TEXTILE MILLS LIMITED
FOR THE 1ST QUARTER ENDED
SEPTEMBER 30, 2017
SHAHZAD TEXTILE MILLS LIMITED02
DIRECTORS’ REPORT
1st Quarterly Report September 30, 2017
On behalf of the directors of Shahzad Textile Mills Limited It is my great pleasure to present the un-audited financial statement for the first quarter ended September 2017. The company’s pretax profit is Rs. 17.877 million as compared to Profit of Rs.17.094 million in corresponding quarter of previous year. Company’s sales of yarn for the current quarter is also increased to Rs. 1,227.556 million from sales of Rs. 1,062.199 million in corresponding period of previous year. In the current quarter company, by the grace of Allah Almighty, have portrayed positive results by exhibiting profit as apparent from the above financial data. Favorable conducive local market conditions and Government’s fiscal measures in country have helped us to achieve these impressive financial results. The prices of Raw material if averagely seen remained strengthened which are currently rotating around Cotton Rs. 6,425/- per maund. Polyester Rs. 134 per kg and viscose Rs. 238/- per kg accordingly. FUTURE PROSPECTUS As we have extensively discussed in the annual directors’ report 2017 that the Management has worked out a plan for smooth supply of fuel and power to Mills i.e. replacement of five (5) existing generator and execute major overhauling of balance two generator for which all major parts have already been imported. One portion of this plan i.e. replacement of Five (5) generators have been already successfully completed by replacement of new imported generators which are efficiently functioning at mills. The remaining two generators are under process of major overhauling which shall hopefully be completed by end of December 2017 and shall be the part of currently functioning generators. Earning per share Rs. 0.28 as compared to Profit per share Rs. 0.46 in corresponding period of previous year. We are thankful and appreciate the efforts of valued customers, bankers, share holders who have actively participated in smooth functioning of company’s routine work and also mention staff members who have dedicatedly worked to run all business activities of the company and strived hard to maintain cordial relation by creating pleasant working environment.
For and on behalf of the board
Lahore. Dated : 23-10- 2017 Imran Aslam Chief Executive Offic
SHAHZAD TEXTILE MILLS LIMITED04
CONDENSED INTERIM BALANCE SHEET
AS AT SEPTEMBER 30, 2017
1st Quarterly Report September 30, 2017
2017Note
September,
(Un-audited)
June 30,2016
(Audited)
------------- Rupees in thousand -------------CAPITAL AND LIABILITIES
Share Capital and ReservesAuthorized capital:
40,000,000 (June 2017: 40,000,000) ordinary shares of Rs. 10 each
Issued, subscribed and paid up capital17,971,372 (June 2017: 17,971,372) ordinary shares of Rs. 10 each
Reserves
Surplus on Revaluation of Property, Plant and EquipmentNon Current LiabilitiesLong term financingStaff retirement benefitsDeferred tax liability
Current Liabilities
Trade and other payables Accrued mark upShort term borrowingsCurrent portion of long term financingProvision for taxation
Contingencies and Commitments
ASSETS
Non Current AssetsProperty, plant and equipmentLong term investment in associateLong term deposits
Current AssetsStores and sparesStock in tradeTrade debtsAdvances, trade deposits, prepayments and other receivablesShort term investmentsTax refunds due from the GovernmentCash and bank balances
The annexed notes form an integral part of this condensed interim financial information (un-audited).
400,000
179,714
1,098,780
1,278,494 475,909
4 88,592 98,076
202,743
389,411
344,644 4,195
128,539 40,740 59,775
577,893
5 -
2,721,707
6 1,650,015 376,947 13,970
2,040,932
70,723 298,127 84,021 96,261
857 81,438 49,348
680,775
2,721,707
400,000
179,714
1,088,787
1,268,501 483,511
98,777 91,187
201,866
391,830
263,575 8,631
406,847 40,740 45,167
764,960
-
2,908,802
1,684,984 370,635 13,970
2,069,589
71,792 478,374 92,684 51,055
821 84,147 60,340
839,213
2,908,802
CHIEF EXECUTIVE CHIEF FINANCIAL OFFICER DIRECTOR
SHAHZAD TEXTILE MILLS LIMITED 05
CONDENSED INTERIM PROFIT AND LOSS ACCOUNT (UN-AUDITED)
FOR THE 1ST QUARTER ENDED SEPTEMBER 30, 2017
1st Quarterly Report September 30, 2017
SalesCost of sales
Gross Profit
Operating expenses:Selling and distribution -
- Administrative expenses
Operating Profit
Finance costOther operating expensesOther income Share of net profit of associate
Profit before Taxation
Taxation
Net Profit for the Period
Earnings per Share - Basic
The annexed notes form an integral part of this condensed interim financial information (un-audited).
Note ---- Rupees in thousand ----
1,227,556 7 (1,170,458)
57,098
(6,643) (29,518)
(36,161)
20,937
(7,344) (2,351)
323 6,312
(3,060)
17,877
(12,839)
5,038
0.28
September 31, 2017
1,062,199 (998,910)
63,289
(14,175) (28,602)
(42,777)
20,512
(7,690) (1,457)
213 5,516
(3,418)
17,094
(8,905)
8,189
0.46
September 31, 2016
CHIEF EXECUTIVE CHIEF FINANCIAL OFFICER DIRECTOR
SHAHZAD TEXTILE MILLS LIMITED06
CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME (UN-AUDITED)
FOR THE 1ST QUARTER ENDED SEPTEMBER 30, 2017
1st Quarterly Report September 30, 2017
Net Profit for the Period 5,038
Other Comprehensive Income for the Period
Items that may be reclassified subsequently to profit and (loss)
Total Comprehensive Income for the Period 5,038
The annexed notes form an integral part of this condensed interim financial information (un-audited).
September 30, 2017
September 30, 2016
---- Rupees in thousand ----
8,189
8,189
CHIEF EXECUTIVE CHIEF FINANCIAL OFFICER DIRECTOR
SHAHZAD TEXTILE MILLS LIMITED07
CONDENSED INTERIM CASH FLOW STATEMENT (UN-AUDITED)
FOR THE 1ST QUARTER ENDED SEPTEMBER 30, 2017
1st Quarterly Report September 30, 2017
CASH FLOW FROM OPERATING ACTIVITIES
Profit before taxation 17,877
Adjustments for:Depreciation 28,081 Share of net profit of associate (6,312) Loss on disposal of property, plant and equipment - Net 1,013 Surplus on revaluation of short term investments at fair value through profit or loss (36) Provision for gratuity 12,250 Exchange (gain) / loss (3) Provision for workers' profit participation fund 961 Provision for workers' welfare fund 377 Finance cost 5,506
41,837 Operating Profit before Working Capital Changes 59,714
Decrease / (Increase) in current assets- Stores and spares 1,068 - Stock in trade 180,247 - Trade debts 8,665 - Advances, trade deposits, prepayments, and other receivables (41,149) - Tax refunds due from the Government 2,709
Increase in current liabilities- Trade and other payables 79,732
231,272 Net Cash generated from Operations 290,986
Income tax paid (4,057) Gratuity paid (5,361) Finance cost paid (9,942) Net Cash generated from Operating Activities 271,626
CASH FLOW FROM INVESTING ACTIVITIES
Property, plant and equipment purchased -Proceeds from disposal of property, plant and equipment 10,000 Capital work in progress (4,125) Net Cash generated from / (used) in Investing Activities 5,875
CASH FLOW FROM FINANCING ACTIVITIES
LTF - Loan repaid (10,185) Loan repaid to directors (40,000) Short term borrowings (238,308) Net Cash used in Financing Activities (288,493)
Net Decrease in Cash and Cash Equivalents (10,992)
Cash and cash equivalents at the beginning of the period 60,340
Cash and Cash Equivalents at the End of the three Months Ended 49,348 10,998
The annexed notes form an integral part of this condensed interim financial information (un-audited).
--- Rupees in thousand ---
September 30, 2017
17,094
21,373(5,516)
- -
8,650171 919 368
6,28332,24849,342
5,032118,977(24,902)(24,328)(6,724)
12,31380,368
129,710
(4,801)(7,167)(6,450)
111,292
(6,689)- -
(6,689)
-
(181,756)(181,756)
(77,153)
88,151
--- Rupees in thousand ---
September 30, 2016
CHIEF EXECUTIVE CHIEF FINANCIAL OFFICER DIRECTOR
SHAHZAD TEXTILE MILLS LIMITED08
CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY (UN-AUDITED)
FOR THE 1ST QUARTER ENDED SEPTEMBER 30, 2017
1st Quarterly Report September 30, 2017
CHIEF EXECUTIVE CHIEF FINANCIAL OFFICER DIRECTOR
Balance as at June 30, 2016 179,714 5,796 1,023,529
Total comprehensive Income for the first quarter - - 8,189
Transferred from surplus on revaluation ofproperty, plant and equipment on incrementaldepreciation charged in current period (net ofdeferred tax) - - 3,925
Transaction with owners
Dividend paid during the period - - -
Balance as at September 30, 2016 179,714 5,796 1,035,643
Balance as at June 30, 2016 179,714 5,796 1,082,991
Total comprehensive Income for the first quarter - - 5,038
Transferred from surplus on revaluation ofproperty, plant and equipment on incrementaldepreciation charged in current period (net ofdeferred tax) - - 3,417
Surplus realized on disposal of revaluedproperty, plant and equipment (net of deferred tax) transferred to retained - - 1,537
earnings
Transaction with owners
Dividend paid during the period - - -
Balance as at September 30, 2017 179,714 5,796 1,092,984
The annexed notes form an integral part of this condensed interim financial information (un-audited).
ParticularsShare
Capital
Share Premium Reserve
Unappropriated Profit
1,209,039
8,189
3,925
-
1,221,153
1,268,501
5,038
3,417
1,537
-
1,278,494
-------------------------- Rupees in thousand ---------------------
Total Equity
SHAHZAD TEXTILE MILLS LIMITED 09
1st Quarterly Report September 30, 2017
NOTES TO AND FORMING PART OF THE CONDENSED
INTERIM FINANCIAL INFORMATION (UN-AUDITED)FOR THE 1ST QUARTER ENDED SEPTEMBER 30, 2017
Note 1The Company and its Operations
Note 2Basis of Preparation
2.1
2.2
Note 3Accounting Policies
Note 4Long Term Financing September 31,
2017(Un-audited)
LTF loan - Secured 129,332 Current portion of LTF loan (40,740)
88,592
4.1
This condensed interim financial statements have been prepared in accordance with the directives issued bythe Securities & Exchange Commission of Pakistan (SECP) and is in compliance with the InternationalAccounting Standard - 34 (Interim Financial Reporting).
This condensed interim financial information is presented in Pak rupees, which is the Company's functional andpresentational currency. Figures have been rounded off to nearest thousand rupees, unless stated otherwise.This condensed financial information does not include all the information required for annual financialstatements and therefore, should be read in conjunction with the annual financial statements for the yearended June 30, 2017.
The accounting policies and methods of computation of this condensed interim financial information is the same as thosefollowed in the preparation of annual financial statements for the preceding financial year ended on June 30, 2017.
These represent LTF loans obtained from banking companies during the period against specific and exclusivecharge on relevant fixed assets of the Company. The tenure of facility is from 3 to 5 years starting fromFebruary 2017 and ends in February 2022. Mark up on these facilities is charged at SBP rate payable quarterly.
Rupees in thousand
Shahzad Textile Mills Limited is a Public Limited Company incorporated in Pakistan under the Companies Act, 1913 (now the Companies Ordinance, 1984) Its Shares are quoted on Pakistan Stock Exchange (PSX). The Company manufactures and deals in all types of yarn. The registered office of the Company is situated at 19-A, Off. Zafar Ali Road, Gulberg - V, Lahore.
June 30,2017
(Audited)
139,517(40,740)98,777
Note 5Contingencies and Commitments
Contingencies
-
September 31,2017
(Un-audited)
- Sui Northern Gas Pipeline Limited 69.32 69.32
-
The Company has provided bank guarantees in favour of following parties:
Rupees in Million
The Company is contingently liable for Rs. 17.438 million (June 2017: Rs. 16.367 million) on account ofelectricity duty on self generation. However the company has not admitted the said duty and case is pendingbefore the Supreme Court of Pakistan.
June 30,2017
(Audited)
69.32 69.32
SHAHZAD TEXTILE MILLS LIMITED10
1st Quarterly Report September 30, 2017
Commitments
-
September 31,2017
(Un-audited)
Foreign bills of exchange purchased 77.92 Letters of credit 25.04
102.96
Note 6Property, Plant and Equipment September 31,
2017(Un-audited)
Operating fixed assets 1,645,890 Capital work in progress 4,125
1,650,015
6.1 Operating fixed assets
Opening written down value 1,609,826 Additions during the period / year (at cost) 75,158
1,684,984
Disposals during the period / year (at written down value) (11,013)
The Company's outstanding commitments / contracts as at the balance sheet date are as under:
Rupees in Million
---- Rupees in thousand ----
June 30,2017
(Audited)
89.08 6.10 95.18
June 30,2017
(Audited)
1,609,826 75,158
1,684,984
1,576,075 140,989
1,717,064
(19,099)
1,673,971 Depreciation charged for the period / year (28,081)
1,645,890
1,697,966(88,140)
1,609,826
Note 7Cost of Sales
September 30, 2017
Raw materials consumed 816,535 Stores and spares consumed 17,646 Packing materials consumed 26,339 Salaries, wages and other benefits 129,097 Fuel and power 148,131 Insurance 1,876 Repairs and maintenance 1,849 Other manufacturing expenses 2,470 Depreciation 25,538
1,169,481 Opening work in process 33,324 Closing work in process (37,170)
(3,846) Cost of goods manufactured 1,165,635
Opening finished goods 55,108 Closing finished goods (50,285)
4,823 1,170,458
September 30, 2016
664,761 21,091 22,980
119,566 132,408
2,052 7,699 2,989
18,352 991,898 29,336
(28,548) 788
992,686
52,961 (46,737)
6,224 998,910
---- (Un-audited) -------- Rupees in thousand ----
SHAHZAD TEXTILE MILLS LIMITED 11
1st Quarterly Report September 30, 2017
CHIEF EXECUTIVE CHIEF FINANCIAL OFFICER DIRECTOR
Note 8Transactions with Related Parties
Transaction during the period September 30,2017
Related party Relationship Nature of Transaction
Sargodha Jute Mills Associate Purchase of materials,Limited goods and services 88
Sale of materials, goods andservices 73
The related parties comprise associated companies, staff retirement funds, directors and key management personnel.The Company in the normal course of business carries out transactions with various related parties. The Company entersinto transactions with related parties on the basis of mutually agreed terms. Significant transactions with related partiesare as follows:
---- (Un-audited) -------- Rupees in thousand ----
September 30,2016
79
612
---- (Un-audited) -------- Rupees in thousand ----
Rent received / receivable 120
Directors Sponsor loan repaid 40,000
Mark up on loan from directors -
Note 9Authorization of Interim Financial Information
Note 10General
This condensed interim financial information (un-audited) is authorized for issue on October 23, 2017 by the Board ofDirectors of the Company.
Corresponding figures have been re-arranged / reclassified, wherever necessary, to facilitate comparison. No significantre-arrangements have been made in this condensed interim financial information (un-audited).
-
610