Professional Documents
Culture Documents
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CONTENTS
CORPORATE INFORMATION
BUSINESS PRINCIPLE
HISTORY
BRANDS
BOARD OF DIRECTORS
COMPANY ANALYSIS
INCOME STATEMENT
GRAPHS
BALANCE SHEET
GRAPHS
MARKET ANALYSIS
ECONOMIC ANALYSIS
FUTURE OUTLOOK
CONCLUSION
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CORPORATE INFORMATION
REGISTERED OFFICE Telephone: +92 (51)
2273457-60 Fax: +92 (51)
Pakistan Tobacco Company 2277924
Limited Dubai Plaza, Plot
No. 5 Street 20, Salman SHARE REGISTRAR
Market, F-11/2 P.O. Box
2549 Islamabad-44000 FAMCO Associates (Pvt.)
Telephone: +92 (51) Ltd.
2083200, 2083201 State Life Building No. 2-A,
Fax: +92 (51) 2111913 4th Floor Wallace Road, Off
Web: www.ptc.com.pk I.I. Chundrigar Road
Karachi
COMPANY SECRETARY
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128/129- G, Commercial Fax: +92 (61) 4542921
Area, Phase- 1, Defence
Housing Authority, Lahore. SINDH &
Telephone: +92 (42) 5899351 BALOCHISTAN
Fax: +92 (42) 5899356 8th Floor, N.I.C. Building,
Abbasi Shaheed Road,
SOUTHERN PUNJAB Karachi.
House No. 93, Street No.3, Telephone: +92 (21)
Meherban Colony, MDA 5635490-5
Chawk, Multan. Fax: +92 (21) 5635500
Telephone: +92(61) 4512553,
4584376
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OVERVIEW OF THE COMPANY
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"Develop a superior product" - is as relevant today as
it was then.
BUSINESS PRINCIPLE
Our Company follows three fundamental Business
Principles:
• Mutual Benefit
• Responsible Product Stewardship
• Good Corporate Conduct
• MUTUAL BENEFIT
The principle of Mutual Benefit is the basis on
which we build our relationships with our
stakeholders.
We are primarily in business to build long term
shareholder value and we believe the best way to
do this is to understand and take account of the
needs and desires of all our stakeholders.
CORE BELIEFS
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• RESPONSIBLE PRODUCT
STEWARDSHIP
CORE BELIEFS
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• GOOD CORPORATE CONDUCT
CORE BELIEFS
HISTORY
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packaging PTC has evolved and grown with
Pakistan. However, what is significant about these
fifty-seven years is the effort that PTC has
demonstrated in the development of the country. By
being instrumental in the campaign for modern
agricultural and industrial practices, we have helped
in the development and progress of the agricultural &
industrial sector in the country.
OUR BRANDS
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• BENSON & HEDGES
• CAPSTAN
Capstan has a rich heritage, originating in Britain in
the 19th century. The brand was created under the
auspices of W.D. & H.O. WILLS at Bristol and
London.
• GOLD FLAKE
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took off when it was repositioned in the value for
money segment and later a 'hinge lid' variant was
introduced in 2000.
• WILLS
• EMBASSY
BOARD OF DIRECTORS
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MUEEN AFZAL
NICHOLAS STEWART HALES
CHAIRMAN AND NON- EXECUTIVE DIRECTOR
MANAGING DIRECTOR AND CEO
MUBASHER RAZA
DEPUTY MANAGING DIRECTOR
AND FINANCE DIRECTOR
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MIRZA REHAN BAIG
AHMED ZEB
MARKETING DIRECTOR
SUPPLY CHAIN DIRECTOR
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FEROZ AHMED
LT. GEN. (RETD.) ALI
NON- EXECUTIVE DIRECTOR
KHAN LHULLI
NON-
EXECUTI
VE
DIRECTO
R
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BEN WILLIAM FORTE TOH AH WAH
NON- EXECUTIVE DIRECTOR NON- EXECUTIVE
DIRECTOR
D
I
R
E
C
T
O
R
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COMPANY ANALYSIS
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FINANCIAL HIGHLIGHTS
(2003-2008)
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Profit & Loss 2008 2007 2006 2005 2004 2003
Volume Million Sticks 41,469 37,188 34,549 30,620 26,846 24,861
Gross Turnover Rs Million 49,054 40,889 35,715 30,615 25,453 22,572
Excise & Sales Tax Rs Million 30,208 24,846 21,824 18,783 15,693 13,849
Net Turnover Rs Million 18,846 16,043 13,891 11,832 9,760 8,723
Gross Profit Rs Million 7,277 6,516 5,534 4,530 3,483 2,872
Operating Profit Rs Million 4,415 3,984 3,048 2,378 1,445 1,010
Profit Before Tax Rs Million 3,894 3,725 2,861 2,082 1,056 615
Profit After Tax Rs Million 2,532 2,420 1,905 1,322 665 321
Earning before interest,taxes,depreciation,
Amortization Rs Million 4,542 4,313 3,394 2,554 1,483 1,051
Dividends Rs Million 2,466 2,529 1,405 946 511 –
Balance Sheet
Paid up capital Rs Million 2,555 2,555 2,555 2,555 2,555 2,555
Shareholders’ Funds Rs Million 3,608 3,705 4,139 3,639 3,263 2,853
Reserves Rs Million 1,053 1,150 1,584 1,084 708 554
Property, Plant & Equipment Rs Million 5,600 5,154 4,529 3,798 3,564 3,411
Net Current Assets /(Liabilities) Rs Million (471) (182) 423 532 297 40
Capital Employed Rs Million 5,184 5,003 4,984 4,364 3,887 3,479
Capital Expenditure during the year Rs Million 1,073 1,191 1,238 717 598 854
Long Term / Deferred Liabilities Rs Million 1,576 1,299 845 725 624 371
Investor Information
Gross profit ratio % 14.83 15.93 15.49 14.80 13.70 12.70
Earnings per share After Tax Rs 9.91 9.47 7.46 5.17 2.60 1.26
EBITDA Margin % 9.26 10.55 9.50 8.34 5.83 4.65
Inventory Turnover Ratio 2.85 2.38 6.69 6.10 7.00 5.90
Fixed Assets Turnover Ratio 8.76 7.93 7.89 8.06 7.10 6.60
Total Assets Turnover Ratio 4.72 4.16 4.09 3.84 3.60 3.10
Break-up value per share Rs 14.12 14.50 16.20 14.24 12.77 12.17
Market value per share at year end Rs 106.30 155.50 72.00 68.95 61.50 27.00
Highest Market value per share during the year Rs 161.00 198.30 80.00 77.00 61.50 39.00
Lowest Market value per share during the year Rs 106.30 74.50 60.45 47.55 46.40 19.50
Price-Earning Ratio Rs 10.73 16.42 9.66 13.33 23.60 21.40
Dividend Per Share Rs 9.65 9.90 5.50 3.70 2.00 -
Dividend yield ratio % 9.08 6.37 7.64 5.37 3.25 -
Dividend payout ratio % 97.39 104.50 73.75 71.56 76.90 -
Return on Capital Employed % 48.84 48.37 38.22 30.29 17.10 9.20
Debt to Equity Ratio 0.16 0.28 0.31 0.30 0.31 0.50
6000
5000
4000
3000
2000
1000
0
2008 2007 2006 2005 2004 2003
GROSSPROFIT
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
2008 2007 2006 2005 2004 2003
INCOME STATEMENT
For the year ended December 31, 2008
2008 Restated
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Rs. 000 2007
Rs.000
Gross turnover 49,053,92 40,889,27
8 5
Excise duty 23,378,44 19,311,94
0 6
Sales tax 6,829,699 5,534,452
Turnover- net of sales & excise duty 18,845,78 16,042,87
9 7
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GRAPHS- INCOME
STATEMENT
2008 2007
Rs. 000 Rs.000
19,000,000
18,000,000
17,000,000 TURNOVER- NET
16,000,000 OFSALES&
EXCISEDUTY
15,000,000
14,000,000
2008 2007
2008 2007
Rs.000 Rs.000
12,000,000
10,000,000
8,000,000
6,000,000
Cost ofsales
4,000,000
2,000,000
0
2008 2007
2008 2007
Rs.000 Rs.000
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7,400,000
7,200,000
7,000,000
6,800,000
6,600,000 Grossprofit
6,400,000
6,200,000
6,000,000
2008 2007
2008 2007
Rs.000 Rs.000
1,000,000
800,000
600,000
Administrative
400,000 expense
200,000
0
2008 2007
2008 2007
Rs.000 Rs.000
4,600,000
4,400,000
4,200,000
Operating
4,000,000
profit
3,800,000
3,600,000
2008 2007
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2008 2007
Rs.000 Rs.000
3,900,000
3,850,000
3,800,000
3,750,000 Profit before
3,700,000 taxation
3,650,000
3,600,000
2008 2007
2008 2007
Rs.000 Rs.000
2,550,000
2,500,000
2,450,000 Profit for
2,400,000 the year
2,350,000
2008 2007
2008 2007
Rs.000 Rs.000
10
9.8
Earningsper
9.6
share- basic
9.4 anddiluted
9.2
2008 2007
BALANCE SHEET
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As at December 31, 2008
Restated
2008 2007
Rs. 000 Rs.000
Property, plant & equipment 5,559,758 5,154,326
Long term investment in subsidiary 5,000 5,000
company
Long term loan 9,244 12,513
Long term deposit & prepayments 41,172 13,025
CURRENT ASSETS
Stock in trade 4,059,063 3,998,181
Stores and spares 190,646 140,777
Trade debts 2,666 2,386
Loans and advances 65,917 38,580
Short term prepayments 105,728 64,887
Other receivables 246,675 229,891
Cash & bank balance 69,172 166,666
4,739,867 4,641,368
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2008 2007
Rs.000 Rs.000
Property, plant & equipment 5,559,758 5,154,326
5,600,000
5,400,000
5,200,000 Property, plant
& equipment
5,000,000
4,800,000
2008 2007
2008 2007
Rs.000 Rs.000
Long term loan 9,244 12,513
14,000
12,000
10,000
8,000
6,000 Longtermloan
4,000
2,000
0
2008 2007
2008 2007
Rs.000 Rs.000
Long term deposit & prepayments 41,172 13,025
50,000
40,000
30,000 Longterm
20,000 deposit &
prepayments
10,000
0
2008 2007
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2008 2007
Rs.000 Rs.000
Stock in trade 4,059,063 3,998,181
4,060,000
4,040,000
4,020,000
4,000,000 Stockintrade
3,980,000
3,960,000
2007 2008
2008 2007
Rs.000 Rs.000
Stores and spares 190,646 140,777
200,000
150,000
100,000
Storesandspares
50,000
0
2008 2007
2008 2007
Rs.000 Rs.000
Trade debts 2,666 2,386
2,700
2,600
2,500
2,300
2,200
2008 2007
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2008 2007
Rs.000 Rs.000
Loans and advances 65,917 38,580
80,000
60,000
40,000 Loansand
advances
20,000
0
2008 2007
2008 2007
Rs.000 Rs.000
Short term prepayments 105,728 64,887
150,000
100,000
50,000
0
2008 2007
2008 2007
Rs.000 Rs.000
Other receivables 246,675 229,891
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2007
2008
2008
29%
2007
71%
2008 2007
Rs.000 Rs.000
Cash & bank balance 69,172 166,666
2008 2007
Rs.000 Rs.000
Total assets 4,739,867 4,641,368
2007 2008
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4,500,000
4,000,000 Trade & other
3,500,000 payables
3,000,000
Accrued interest &
2,500,000
mark up
2,000,000
1,500,000 Short term
1,000,000 borrowings
500,000 Income tax
0 payable
2008 2007
ANALYSIS
MARKET ANALYSIS
In terms of volume alone, PTC managed to sell 41.5
billion cigarette sticks, an increase of 12%. Compared
to sales volume of the tobacco industry, which
increased by only 2.4%, sales volume growth of PTC
was remarkable. Due to
ECONOMIC ANALYSIS
PTC managed to post a strong performance in FY08 in
spite of adverse economic situation prevalent in the
country during the time. Factors such as inflation,
rupee devaluation, high fuel costs, damage to company
property and operations due to terrorism, and an overall
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recessionary trend did not dampen the sales of PTC. In
fact, the sales turnover reached a new high of Rs 49
billion in FY08, up from Rs 41 billion in FY07. The
gross profit was Rs 7.28 billion, an upsurge of 11.8%
from the previous year's Rs 6.52 billion. The profit for
the year increased by 4.9% to Rs 2.53 billion from Rs 2.42
billion a year earlier.
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Aside from these, administrative expenses included
great upward movement in repair and maintenance
and travelling, accounted for by the relocation and
repair costs borne by the PTC due to destruction of its
head office in the Marriott bombings. Secondly, a lower
profit margin for FY08 was also due to a surge of
other expenses by a whopping 89%. Furthermore,
nearly half of other expenses are made up of costs of
business restructuring, which the company is going
through at the moment.
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growth was little over 2%. In fact, due to the slow
growth, current ratio now constitutes 45.6% of all
assets, while previously they formed 47.23%. The
main head making over 85% of current assets is that of
stocks-in-trade, which only grew at 1.5%, bringing down
the growth rate of current assets.
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down from 36.46 days in FY07.
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deteriorated the TIE ratio to its current level.
FUTURE OUTLOOK
The ratification of Framework Convention for
Tobacco Control (FCTC) by Pakistan, coupled with
marketing restrictions of various kinds has not bid
well for tobacco manufacturers. Furthermore, there
have been increased taxes and duties levied by the
government on tobacco products and producers. In
fact, in February 2009, the government increased the
Federal Excise Duty on tobacco products.
Considering that the cost of doing business will not
subside in the near future for manufacturers due to
prevalence of high inflation and fuel costs, these
factors would hurt the future earnings of PTC.
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manufacturing facilities.
CONCLUSION
Pakistan Tobacco Company Limited (PTC) is part of
British American Tobacco - the world's most
international tobacco group - with brands sold in 180
markets around the world. The company produces
high quality tobacco products to meet the diverse
preferences of millions of consumers, and it works in
all areas of the business - from seed to smoke.
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net and operating profits, with the operating profits
growing by 28% and net profit growing by 44% in
2006 compared to the previous year. The strong
financial performance is attributed to higher sales
volume, improved margins in all brands, and
continued control over cost through a focus on
operational efficiencies and other initiatives.
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