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Contents

01 02 03 04 07 08 10 11 12 14 15 16 17 18 39 Vision & Mission Notice of Meeting Brief History of the Company Directors Report to the Members Chief Executives Message Statement of Compliance with CCG Review Report to the Members Auditors Report to the Members Balance Sheet Profit and Loss Account Statement of Comprehensive Income Cash Flow Statement Statement of Changes in Equity Notes to the Financial Statements Pattern of Shareholding Form of Proxy

Vision & Mission


Vision Statement
To develop into an institution delivering extra value through superior product quality and professionally principled management. To stay abreast of technological advancements and human resource development to meet the changing and challenging requirements of our customers.

Mission Statement
To provide an uninterrupted supply of quality products through a continuous process of sourcing, developing, implementing and improving the best leadingedge technology, work force and innovative ideas. To create and sustain a workplace where employer and employees are committed to promote change towards patterns of economic development that are environmentally sustainable and socially equitable.

Human Resource Development


Employee development is one of the pivotal areas for Organizational development. The organizational competence levels, new training programs encompassing Performance Management, Leadership and Competency Development are introduced. SAMIN is setting process benchmarks across all areas and utilizing it as a management system to execute its strategic objectives. Employees will drive improvements in other areas; speed, innovation, perfection and in becoming world class professionals. It helps ensure that SAMIN sustains its promise of delivering high quality products and services to its customers on time, every time. The learning does not stop here. The Company has a range of additional training programs, both core management and technical, which are used on a regular basis to develop skills and knowledge. In addition, specific oneoff programs may be developed on a need basis. Alternatively, individuals may attend externally run programs and there may be cases where learning by planned job experience is the best answer. Employees contributions to assessing their own training needs are welcomed as the suggestions for suitable programs.

Kaizen
Kaizen is a Japanese word meaning gradual and orderly continuous improvement. The Kaizen business strategy involves everyone in an organization working together to make improvements without large capital investments. SAMIN is implementing Kaizen by the lower / middle management and the workers, with the encouragement and direction of the top. The top management is cultivating a KAIZEN working climate and culture in the organization. All processes, from preparation to quality assurance to packaging, are undertaken employing stateoftheart technology and equipment. Therefore, we take great pride in the fact that SAMIN is the only textile unit in Pakistan that has the following international certifications of quality and prestige:

OE 100 Standard of the Organic Exchange/Textile Exchange

ISO 14001:2004 Environmental Management System

ISO 9001:2008 Quality Management System

Oeko-Tex Standard 100 Product Class II - Products with direct contact to skin)

for the year ended June 30, 2011

Financial Statements

Notice of 22nd Annual General Meeting


Notice is hereby given that the 22nd Annual General Meeting of the shareholders of Samin Textiles Limited (the Company) will be held on Saturday, 15th October 2011 at 3:00 pm at the registered office of the Company, 50C Main Gulberg, Lahore, to transact the following business: v). Members who have deposited their shares into Central Depository Company of Pakistan limited (CDC) will further have to follow the under mentioned guidelines as laid down by the Securities and Exchange Commission of Pakistan. For Attending the Meeting In case of Individuals, the account holder and /or subaccount holder and their registration details are uploaded as per the CDC Regulations, shall authenticate his/her identity by showing his/ her original CNIC or original passport at the time of attending the Meeting. In case of corporate entity, the Boards resolution / power of attorney with specimen signature of the nominee shall be produced (unless it has been provided earlier) at the time of the meeting. For Appointing Proxies In case of Individuals, the account holder and /or subaccount holder and their registration details are uploaded as per the CDC Regulations, shall submit the proxy form as per above requirements. The proxy form shall be witnessed by two persons, whose names, addresses and CNIC numbers shall be mentioned on the form. Attested copies of the CNIC or the passport of beneficial owners and the proxy shall be furnished with proxy form. The proxy shall produce his original CNIC or original passport at the time of the Meeting. In case of corporate entity, the Boards resolution / power of attorney with specimen signature shall be furnished (unless it has been provided earlier) along with proxy form to the Company.

Ordinary Business
i) ii) To confirm the minutes of last AGM held on October 29, 2010. To receive, consider and adopt the Audited Financial Statements of the Company for the year ended June 30, 2011 together with the Directors and Auditors Reports there on. To appoint auditors of the Company for the year ending June 30, 2012 and fix their remuneration. The retiring auditors M/S Anjum Asim Shahid Rahman, Chartered Accountants, being eligible, offer themselves for reappointment. To elect seven Directors of the company as fixed by the Board of Directors under Section 178 of the Companies Ordinance 1984. The names of the retiring Directors are: i) ii) iii) iv) v) vi) vii) Mr. Sarmad Amin Mr. Jehanzeb Amin Mr. Jamil Masud Mr. Safder Hussain Tariq Mr. Tariq Ali Mr. Tariq Jillani Mr. Asad Ahmad Jan

A. a)

iii)

b)

iv)

B. a)

b) c) d) e)

All the retiring directors shall be eligible to offer themselves for re-election. In terms of section 178(3) of the Companies Ordinance1984, any person who seeks to contest an election to the office of director, whether he is a retiring director or otherwise, shall file with the company not later than fourteen (14) days before the date of the meeting, a notice of his intention to offer himself for election as a director. v) To transact any other business with the permission of the chairman. By order of the Board

Lahore: September 23, 2011

Safder Hussain Tariq Company Secretary

Notes:
i) ii) The share transfer books of the Company will remain closed from October 07th, 2011 to October 15th, 2011 (both days inclusive). Shareholders are requested to promptly notify any change in their addresses to the Companys Share Registrar, M/s Corplink (Private) Limited, Wings Arcade, 1K, Commercial, Model Town, Lahore.

iii). A member entitled to attend and vote at this meeting may appoint any other member as his/her proxy to attend and vote instead of him/her. iv). The instrument appointing a proxy and the power of attorney or other authority under which it is signed or a notarially attested copy of the power of attorney must be deposited at the Registered Office of the Company at least 48 hours before the time of the meeting.

Samin Textiles Limited

Brief History of the Company


Samin Textiles Limited is a weaving unit with an average annual production capacity of 23.00 million running meters of the best quality greige cloth based on three shifts a day and 360 working days per annum. At its inception Samin was primarily involved with the manufacture of narrow width commodity textiles that were easy to produce and easy to sell in the export market. The narrow width business has seen a significant change in the product mix as well as the targeted customers. From simple twills and drills, Samin has shifted to the manufacture of specialized and niche items such as abrasive fabric for industrial use, mechanical stretch items for specialized work wear and corduroy and dyedyarn fabric for the high end fashion market. With these changes in product range, so has the customer base shifted from the FarEast to Europe and whenever else in the world our top quality fabric is required. Furthermore, in 2003 Samin expanded its production capacities to include wider width fabric. This comprises Samins Home textile division which concentrates on all sorts of fabric for the Home Textiles market including specialized dobby and dyed yarn items. In the twenty one year period of its existence, Samin has established itself as an internationally renowned greige fabric specialist giving priority to quality and unparalleled service. Samin has set up its own gas fired generators and installed WAPDA connection for backup. and is now self sufficient in power generation having constant supply of un-interrupted electricity.

The Board of Directors of the Company comprises of the leading businessmen / professionals of Pakistan. They are:
Mr. Sarmad Amin Mr. Jehanzeb Amin Mr. Safder Hussain Tariq Mr. Tariq Ali Mr. Tariq Jillani Mr. Asad Ahmad Jan Mr. Jamil Masud Chairman Chief Executive Director Director Director Director Director

for the year ended June 30, 2011

Financial Statements

Directors Report to the Members


On behalf of the Board of Directors the undersigned takes pleasure to present before you the twenty second Annual report for the financial year ended June 30, 2011 along with Auditors Report there on. Operating Financial Results During the financial year under review, Companys sales have crossed land mark of three billion and posted record high of Rs. 3.096 billion as compared to Rs. 1.810 billion of the corresponding last year. The said phenomenal increase is in both areas, volumetric and also in price. Volumetric increase is due to the fact that this year we had stand by Wapda connection and the plant managed to achieve 79% of its rated capacity as compared to 60% during last year. Aforementioned situation helped us to bring a turn around and the posted a net profit after tax of Rs. 45.822M as compared to a net loss of Rs.29M during the corresponding period of last year. The under noted chart explains the turn around story itself:-

For the Year Ended 30 June 2011

For the Year Ended 30 June 2010

Corresponding Increase(%)

Sales Gross Profit Operating Profit /(Loss) Finance Cost Profit Before Tax Profit After Tax Net Profit Margin ROE ROA

3,096,483,739 291,286,099 184,874,831 139,209,503 61,763,140 45,822,132 1.48% 5.77% 1.92%

1,810,676,592 81,503,246 (476,306) 141,489,153 (13,547,095) (29,468,257) -1.63% -4.88% -1.29%

71.01% 257.39% 3,8914.33% -1.61% 555.91% 255.50% 190.75% 217.95% 248.41%

The textile industry is facing both, internal and external challenges. On internal fronts, availability of energy and its rising cost, scarce availability of borrowing and its high cost, volatile yarn prices and its availability due to closure of many spinning mills has made the survival of the industry more difficult. On external fronts, recession in major international economies has reduced the demand of our finished products which has badly hurt the prices and compound with adverse local market conditions, a situation of unhealthy competition and high risk business environment has been created. Key to survival under the given circumstances is controlling costs at all levels and under each head coupled with optimizing production efficiencies. Charts of Significant Ratios 2011 (Rupees in Million) Sales Profit / (Loss) after tax Reserves Gross Profit Ratio Net Profit / (Loss) Ratio Break-up Value /Share Current Ratio Debt/Equity Ratio Dividend pay Out% Earning/(Loss) per Share Fixed Assets Long Term Liabilities 3,096.48 45.822 527.45 9.40% 1.48% 37.72 1.43 1:99 Nil 2.28 789.657 10.898 1,810.68 (29.468) 470.35 4.50% (1.63%) 62.01 1.38 2:98 Nil (2.21) 837.842 19.566 1,585.78 (76.210) 662.317 7.04% (4.81%) 64.55 1.68 6:94 Nil (5.70) 631.361 59.590 1,687.14 (20.08) 854.772 2.84% (1.19%) 78.94 1.85 6:94 5% (1.50) 678.626 77.513 1,687.50 4.39 61.487 8.97% 0.26% 19.59 0.68 24:76 Nil 0.33 733.698 120.78 1,613.88 35.10 57.094 11.82% 2.17% 19.26 0.80 32:68 Nil 2.63 745.533 184.079 2010 2009 2008 2007 2006

Samin Textiles Limited

Directors Report to the Members


(Rs. in Million)
3500
3,096

Sales

Pro t / (Loss) after tax


50 40 30 20
45.82

(Rs. in Million)

35.10

3000

2500

10 0

4.39

2000
1,811 1,586 1,687 1,688

-10 -20
1,614 -20.08 -29.47

1500

-30 -40 -50 -60 -70

1000

500

2011 2010 2009 2008 2007 2006

-80

-76.21

2011

2010

2009

2008

2007

2006

Earning/ (Loss) Per Share


3
2.28

Debt Equity Ratio


2.63

(in Rupee)

100

99

98

94

94

2 1 0 60 -1 -2
-2.21 -1.5

80
0.33

76 68

40
32 24

-3 -4 -5 -6
-5.7

20
6 6

2011

2010

2009 Equity

2008

2007

2006

2011

2010

2009

2008

2007

2006 Debt

EXPANSION PLAN Company has finalized the financing arrangements for its proposed expansion plan of 25 looms, one compressor, knotting machine, overhead cleaners and AC equipment. L/C for AC equipment has been opened and for rest of the machinery will be opened very shortly. The said expansion plan will help the company in reducing its fixed cost of production and also bring versatility in our product range of finished goods. INVESTMENTS Company has the following investments as on June 30, 2011:(i) Security General Insurance Company Ltd (10,214,914 shares@Rs.81.899 each) (ii) Onetel Pakistan Private Ltd (100,000 shares@Rs.10 each) (Share Deposit Money) Rs. 836,600,968

CORPORATE GOVERNANCE The Board of Directors of Samin Textiles and its management are fully conversant with its responsibilities as formulated in Code of Corporate Governance as incorporated in the listing regulations of stock exchanges issued by the SECP. The prescribed practices are effectively under implementation in the company and there has been no material departure from the best practices of Corporate Governance as detailed in the listing regulations. The statements as required by the Code of Corporate Governance are given below: 1. PRESENTATION OF FINANCIAL STATEMENT The financial statements, prepared by the management of the company, fairly present its state of affairs, the results of its operations, cash flows and changes in equity. BOOKS OF ACCOUNTS The company has maintained proper books of Accounts. ACCOUNTING POLICIES Appropriate accounting policies have been consistently applied in preparation of financial statements and accounting estimates are based on reasonable and prudent judgment.
Financial Statements

Rs. 1,000,000 Rs. 1,150,000 Rs. 2,150,000

23.

The management is confident that the said investments will bring the company a good dividend yield and capital gain.

for the year ended June 30, 2011

Directors Report to the Members


4. INTERNATIONAL ACCOUNTING STANDARDS (IAS) International Accounting Standards, as applicable in Pakistan, have been followed in preparation of financial statements. ACCOUNTING YEAR The accounting year of the company is from 1st July to 30th June. AUDIT COMMITTEE The Board of Directors in compliance to the Code of Corporate Governance has established an Audit Committee and the following non-executive directors are its members: Mr. Jamil Masud Mr Tariq Jillani Mr. Asad Ahmad Jan Miss Saila Siddique 7. Chairman Member Member Secretary 15. BOARD MEETINGS During the year under review, four meeting of Board of Directors were held and the attendance of Directors was as under:Mr. Sarmad Amin Mr. Jehanzeb Amin Mr. Jamil Masud Mr. Safder Hussain Tariq Mr. Tariq Ali Mr. Tariq Jillani Mr. Asad Ahmad Jan 04 Nos. 03 Nos 01 Nos. 04 Nos. 01 Nos. 02 Nos. 02 Nos.

5. 6.

(However, leave of absence was granted to the Directors who could not attend the Board Meetings due to their preoccupations.) 16. AUDITORS The Auditors of the Company shall be appointed in the forthcoming AGM for the next year 2011-12 and fix their remuneration. STAFF RETIREMENT BENEFITS The Company is operating a provident fund scheme for its employees, which is kept in a separate PLS bank account PATTERN OF SHAREHOLDING AND INFORMATION UNDER CLAUSE XVI (J) OF THE CODE OF CORPORATE GOVERNANCE The information under this head as on June 30, 2011 is annexed. KEY OPERATING AND FINANCIAL DATA The key operating and financial data for last six years is annexed. DISCLOSURE TO MEMBERS OF DIRECTORS INTEREST AS PER PROVISION OF SECTION 218 (1) OF THE COMPANIES ORDINANCE, 1984. In pursuance of the provision of section 218 (1) of the Companies Ordinance, 1984, the members of the Company are notified that the Board of Directors of the Company in their meeting held on 30th August 2011 has revised the remunerations of the Chief Executive and whole time directors and the Company Secretary by giving an annual increment of 10% p.a. in accordance with the approved service rules of the Company. The revised remunerations of the Chief Executive and whole time directors and the Company Secretary are as follows:
Designation Chairman/Director Chief Executive Director/Secretary Director 2010-11 250,000 250,000 131,250 136,475 2011-12 275,000 275,000 144,485 150,123

SAFETY AND ENVIRONMENTS The Company strictly complies with the standards of the safety rules and regulations. It also follows environmental friendly policies. GOING CONCERN There is no significant doubt upon the Companys ability to continue as a going concern. INTERNAL CONTROL SYSTEM The system of internal control is sound in design and has been effectively implemented and monitored. The review will continue in future for the improvement in controls. TRADING COMPANYS SHARES The information under this head is disclosed in pattern of shareholding. OUTSTANDING STATUTORY DUES Detail of outstanding statutory dues is given in note No. 10 to the Accounts. DIVIDEND Since the profit declared is not in the shape of realized profit, therefore, dividend will be declared in subsequent period when the accounting profit is actually realized. QUALITY CONTROL To ensure implementation of the Management System, Internal Quality Audits, Surveillance audits and Management review meetings are conducted regularly. COMMUNICATION Communication with the shareholders is given high priority. Annual, Half Yearly and Quarterly Accounts are distributed to them within the time specified in the Companies Ordinance, 1984. Every opportunity is given to the individual shareholders to attend and freely ask questions about the company operations at the Annual General Meeting.

17.

8.

18.

9.

19. 20.

10.

11.

12.

13.

S.No. Name 1 2 3 4 Mr. Sarmad Amin Mr. Jehanzeb Amin Mr. Safder Hussain Tariq Mr. Tariq Ali

14.

There is no change in other terms and conditions of their appointment in which any director of the Company is in any way, whether directly or indirectly, concerned or interested. ACKNOWLEDGEMENT The Board is pleased and appreciates the continued dedication and support of all the employees of the company. For and on behalf of the Board

Lahore: August 30, 2011

Sarmad Amin Chairman / Director

Samin Textiles Limited

Chief Executives Message


Cotton started to crash all over the world, and yarn followed closely. Cotton prices fell from 13500/mound to 6000/mound in a period of 5 months. Fabric buyers had sufficient stocks to be cautious in their buying and sales started to plummet. Finishers are still looking to reduce their purchasing cost and buying has been minimal during the third and fourth quarters. We expect normal purchasing from Europe to resume after the summer holidays in October. Another major cause for concern was the energy situation. Today Pakistan faces an energy shortfall of more than 4000 MW. Most mills, including Samin have invested in multiple captive energy sources over the years. Starting with diesel, we moved to furnace oil and then to gas.
Jehanzeb Amin
CEO

Currently there is a shortfall in gas supplies of 220mmcfd in Punjab and we have had to install a connection with the national grid. Electricity supply from the grid is also unreliable with average load shedding of up to 17%. Not only this is having a catastrophic effect on our costs, but timely deliveries and quality of product is also at risk. However Samin, has been communicating with WAPDA through APTMA and working through the crisis in the most efficient manner. Moreover our energy efficiency initiative is now bearing fruit and energy savings as a result are helping to ease the pressure of the energy crunch. A very positive achievement for Samin during this financial year was the successful implementation of the fist phase of an ERP system by industry leaders, SAP. The second and final phase is scheduled to be implemented by the end of the first quarter. To take maximum advantage and fully utilize the ERP system, Samin has also been undergoing the implementation of a supply chain department. This will help the company to plan the allocation of its resources in the most efficient manner along with refining supplier relationship, product quality and customer satisfaction.

The year under review was a rollercoaster year for the international textile industry, with cotton prices remaining unpredictable and volatile. The international textile industry was adversely affected by the 2009 global financial crisis, and weaving was no exception. 2010 saw a major recovery for the spinning sector in Pakistan and this prompted international buyers to secure fabric orders as well. As a result Samin also saw very positive developments in fabric sales during the period, with an increase of about 40 %. Towards the end of November, final users of fabric had incorporated the increase in prices, so we were expecting very positive final two quarters of the financial year ending June 2011. The situation was positive till January, but then it started taking a downturn.

for the year ended June 30, 2011

Financial Statements

Statement of Compliance
with the Code of Corporate Governance for the Year Ended June 30, 2011
This statement is being presented to comply with the Code of Corporate Governance contained in Regulation No. 35 of listing regulations of Karachi Stock Exchange (Guarantee) Limited for the purpose of establishing a framework of good governance, whereby a listed company is managed in compliance with the best practices of corporate governance. The Company has applied the principles contained in the Code in the following manner: 1. The Company encourages representation of independent non executive directors and directors representing minority interests on its board of Directors. At present the Board includes three independent nonexecutive directors. 2. The directors have confirmed that none of them is serving as a director in more than ten listed companies, including this Company. 3. All the resident directors of the Company are registered as taxpayers and none of them has defaulted in payment of any loan to a banking company, a DFI or NBFI or, being a member of a stock exchange, has been declared as a defaulter by that stock exchange. 4. The company has prepared a Statement of Ethics and Business Practices, which has been signed by all the directors and employees of the Company. 5. The Board has developed a vision / mission statement, overall corporate strategy and formulated significant policies of the Company. A complete record of particulars of significant policies along with the dates on which they were approved or amended has been maintained. 6. All the powers of the board have been duly exercised and decisions on material transactions, including appointment and determination of remuneration and terms and conditions of employment of the CEO have been taken by the board. 7. The meetings of the Board were presided over by the Chairperson and, in her absence, by a director elected by the Board for this purpose and the Board met at least once in every quarter. Written notices of the board meetings, along with agenda and working papers, were circulated at least seven days before the meeting. The minutes of the meeting were appropriately recorded and circulated. 17. The Statutory auditors of the company have confirmed that they have been given a satisfactory rating under the quality control review programme of the Institute of Chartered Accountants of Pakistan. That they or any of the partners of the firm, their spouses and the minor children do not hold shares of the company and that the firm and all its partners are in compliance with international federation of Accountants (IFAC) guidelines on code of ethics as adopted by the Institute of Chartered Accountants of Pakistan. 16. The Board has setup an effective internal audit function. 15. 14. The Board has formed an audit committee. It comprises three members, of whom two are nonexecutive directors. The meeting of the audit committee were held at least once every quarter prior to approval of interim and final results of the company and as required by the Code. The terms of reference of the committee have been formed and advised to committee for compliance. 13. 12. 11. The financial statements of the company were duly endorsed by the CEO and CFO before approval of the Board. The directors, CEO and executives do not hold any interest in the shares of the company other than that disclosed in the pattern of shareholding. The company has complied with all the corporate and financial reporting requirements of the Code. 10. The directors report for this year has been prepared in compliance with the requirements of the Code and fully describes the salient matters required to be disclosed. 9. The Board had approved appointment of CFO, company Secretary and head of internal Audit, including their remuneration and terms and conditions of employment, as determined by the CEO. 8. The board arranges orientation course for its directors as and when needed to apprise them of their duties and responsibilities.

Samin Textiles Limited

Statement of Compliance
with the Code of Corporate Governance for the Year Ended June 30, 2011
18. The statutory auditors or the persons associated with them have not been appointed to provide other services except in accordance with the listing regulations and the auditors have confirmed that they have observed IFAC guidelines in this regard. 19. The company maintains a list of related parties which is updated on a regular basis. All transactions with related parties are placed before the Board of Audit committee on a quarterly basis and are approved by the Board of Directors along with the method of pricing. 20. We confirm that all the other material principles contained in the Code have been complied with. On behalf of the Board of Directors.

Lahore: August 30, 2011.

Sarmad Amin Chariman

for the year ended June 30, 2011

Financial Statements

REVIEW REPORT TO THE MEMBERS ON STATEMENT OF COMPLIANCE WITH THE BEST PRACTICES OF CODE OF CORPORATE GOVERNANCE
We have reviewed the Statement of Compliance with the best practices contained in the Code of Corporate Governance prepared by the Board of Directors of Samin Textiles Limited (the Company) to comply with the Listing Regulations of Karachi and Lahore Stock Exchanges where the company is listed. The responsibility for compliance with the Code of Corporate Governance is that of the Board of Directors of the Company. Our responsibility is to review, to the extent where such compliance can be objectively verified, whether the Statement of Compliance reflects the status of the Companys compliance with the provisions of the Code of Corporate Governance and report if it does not. A review is limited primarily to inquiries of the Company personnel and review of various documents prepared by the Company to comply with the Code. As part of our audit of financial statements we are required to obtain an understanding of the accounting and internal control systems sufficient to plan the audit and develop an effective audit approach. We are not required to consider whether the Boards statement on internal control covers all risks and controls, or to form an opinion on the effectiveness of such internal controls, the Companys corporate governance procedures and risks. Further, Listing Regulations of the Karachi and Lahore Stock Exchanges require the Company to place before the Board of Directors for their consideration and approval related party transactions distinguishing between transactions carried out on terms equivalent to those that prevail in arms length transactions and transactions which are not executed at arms length price recording proper justification for using such alternate pricing mechanism. Further, all such transactions are also required to be separately placed before the audit committee. We are only required and have ensured compliance of requirement to the extent of approval of related party transactions by the Board of Directors and placement of such transactions before the audit committee. We have not carried out any procedures to determine whether the related party transactions were under taken at arms length price or not. Based on our review, nothing has come to our attention which causes us to believe that the Statement of Compliance does not appropriately reflect the Companys compliance, in all material respects, with the best practices contained in the Code of Corporate Governance as applicable to the Company for the year ended 30 June 2011.

CHARTERED ACCOUNTANTS Engagement Partner: Asim Iftikhar Dated: August 30, 2011 Lahore

10

Samin Textiles Limited

AUDITORS REPORT TO THE MEMBERS


We have audited the annexed balance sheet of Samin Textiles Limited as at June 30, 2011 (the Company) and the related profit and loss account, statement of comprehensive income, cash flow statement and statement of changes in equity 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. It is the responsibility of the Companys management to establish and maintain a system of internal control, and prepare and present the above said statements in conformity with the approved accounting standards and the requirements of the Companies Ordinance, 1984. Our responsibility is to express an opinion on these statements based on our audit. We conducted our audit in accordance with the auditing standards as applicable in Pakistan. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the above said statements are free of any material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the above said statements. An audit also includes assessing the accounting policies and significant estimates made by management, as well as, evaluating the overall presentation of the above said statements. We believe that our audit provides a reasonable basis for our opinion and, after due verification, we report that: a) b) in our opinion, proper books of account have been kept by the Company as required by the Companies Ordinance, 1984; 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; the expenditure incurred during the year was for the purpose of the Companys business; and the business conducted, investments made and the expenditure incurred during the year were in accordance with the objects of the Company;

(ii) (iii)

c)

in our opinion and to the best of our information and according to the explanations given to us, the balance sheet, profit and loss account, statement of comprehensive income, cash flow statement and statement of changes in equity together with the notes forming part thereof conform with approved accounting standards as applicable in Pakistan and 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 Companys affairs as at June 30, 2011 and of the profit, total comprehensive income, its cash flows and changes in equity for the year then ended; and in our opinion no Zakat was deductible at source under the Zakat and Ushr Ordinance, 1980.

d)

CHARTERED ACCOUNTANTS Engagement Partner: Asim Ifitkhar Lahore Dated: August 30, 2011

for the year ended June 30, 2011

Financial Statements

11

Balance Sheet
as at June 30, 2011
June 30, 2011 Note Rupees June 30, 2010 Rupees

EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES Issued, subscribed and paidup capital Reserves 4 5 267,280,000 527,451,412 794,731,412 133,640,000 470,351,231 603,991,231

Surplus on revaluation of property, plant and equipment Subordinated loan unsecured NON CURRENT LIABILITIES Longterm financing Liabilities against assets subject to finance lease Deferred tax and other liabilities

6 7

213,482,180 10,411,566

224,760,229 133,072,075

8 9 10

3,436,163 7,461,439 248,898,965 259,796,567

11,436,163 8,120,054 266,358,647 285,914,864

CURRENT LIABILITIES Trade and other payables Accrued markup Short term borrowings Current portion of long term borrowings 11 12 13 14 350,184,392 47,073,533 694,198,185 20,293,165 1,111,749,275 265,099,671 41,051,115 649,022,903 82,951,466 1,038,125,155

CONTINGENCIES AND COMMITMENTS

15 2,390,171,000 2,285,863,554

The annexed notes 1 to 44 form an integral part of these financial statements.

Lahore August 30, 2011

Jahanzeb Amin Chief Executive

12

Samin Textiles Limited

June 30, 2011 Note Rupees

June 30, 2010 Rupees

ASSETS NON CURRENT ASSETS Property, plant and equipment INVESTMENT IN EQUITY ACCOUNTED INVESTEE LONG TERM DEPOSITS CURRENT ASSETS Stores, spares and loose tools Stock in trade Trade debts Loans and advances Trade deposits Investments Other receivables unsecured considered good Cash and bank balances 19 20 21 22 23 24 25 26 53,612,243 356,977,304 241,417,670 69,633,242 8,266,563 836,600,968 6,625,194 20,953,343 1,594,086,527 44,386,029 330,998,134 109,438,047 84,278,694 8,266,563 836,600,968 7,538,791 16,490,911 1,437,998,137 16 17 18 789,657,734 2,150,000 4,276,739 837,842,504 2,150,000 7,872,913

2,390,171,000 The annexed notes 1 to 44 form an integral part of these financial statements.

2,285,863,554

Safder Hussain Tariq Director


for the year ended June 30, 2011

Financial Statements

13

Profit and Loss Account


for the year ended June 30, 2011
June 30, 2011 Note Rupees June 30, 2010 Rupees

Sales net Cost of goods sold Gross profit Other operating income Distribution cost Administrative expenses Other operating expenses

27 28

3,096,483,739 2,805,197,640 291,286,099

1,810,676,592 1,729,173,346 81,503,246 135,141,530 39,170,176 42,809,376 6,723,166 88,702,718 141,489,153 (13,547,095) (15,921,162) (29,468,257)

29 30 31 32

27,110,111 60,586,945 45,824,323 11,012,299 117,423,567

Finance cost Profit / (loss) before taxation Provision for taxation Profit / (loss) after taxation

33 34

139,209,503 61,763,140 (15,941,008) 45,822,132

EARNINGS / (LOSS) PER SHARE BASIC AND DILUTED The annexed notes 1 to 44 form an integral part of these financial statements.

36

2.28

(2.21)

Lahore August 30, 2011

Jehanzeb Amin Chief Executive

Safder Hussain Tariq Director

14

Samin Textiles Limited

Statement of Comprehensive Income


for the year Ended June 30, 2011
June 30, 2011 Note Rupees June 30, 2010 Rupees

Profit / (loss) after taxation Other comprehensive income: Diminution in value on remeasurement of investments classified as available for sale Gain on revaluation of property, plant and equipment Reclassification adjustment relating to gains/(losses) realized on disposal of available for sale investment securities

45,822,132

(29,468,257)

(40,831,561) 158,110,492

Impairment loss on available for sale investment securities Other comprehensive income / (loss) for the year Total comprehensive income / (loss) for the year The annexed notes 1 to 44 form an integral part of these financial statements. 45,822,132

(81,804,140) (39,862,304) (4,387,514) (33,855,771)

Lahore August 30, 2011

Jehanzeb Amin Chief Executive

Safder Hussain Tariq Director


for the year ended June 30, 2011

Financial Statements

15

Cash Flow Statement


for the year ended June 30, 2011
June 30, 2011 Note Rupees June 30, 2010 Rupees

CASH FLOWS FROM OPERATING ACTIVITIES Cash generated from operations Finance cost paid Employee benefits paid Payment of Workers Profit Participation Fund Taxes paid 38 198,550,654 (133,187,085) (117,400) (15,375,723) (33,283,289) (181,963,497) Net cash from / (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES Long term investment in associate Long term deposits Proceeds from disposal of property, plant and equipment Purchase of property, plant and equipment Proceeds from investments Dividend received Net cash from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Short term borrowings Net repayment of long term financing Repayment of finance lease liabilities Subscription received against right shares Net cash used in financing activities Effects of exchange rate changes on cash and cash equivalents Net increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year The annexed notes 1 to 44 form an integral part of these financial statements. 26 45,175,282 (70,658,301) (658,615) 10,979,491 (15,162,143) (725,727) 4,462,432 16,490,911 20,953,343 (5,951,385) (3,337,503) (22,265,091) (31,553,979) (1,619,044) 8,023,346 8,467,565 16,490,911 3,596,174 1,753,405 (27,123,719) 25,537,285 3,763,145 (1,150,000) (1,618,654) 13,340,000 (46,482,183) 132,370,000 22,564,828 119,023,991 16,587,157 72,004,441 (126,635,037) (137,300) (8,776,729) (14,282,997) (149,832,063) (77,827,622)

Lahore August 30, 2011

Jehanzeb Amin Chief Executive

Safder Hussain Tariq Director

16

Samin Textiles Limited

Statement of Changes in Equity


for the year ended June 30, 2011
Surplus on revaluation of investment to fairvalue Unappropriated profit / (accumulated loss) Rupees Surplus on revaluation of property, plant

Issued, subscribed and paidup capital

Sub Total

Total

Balance as at July 01, 2009 Loss after taxation for the year Other comprehensive income / (loss) for the year Balance as at June 30, 2010 Profit after taxation for the year Right shares issued during the year Transfer from surplus on revaluation of property, plant and equipmentnet of tax Balance as at June 30, 2011

133,640,000 133,640,000 133,640,000

703,806,442 (162,498,006) 541,308,436

(41,488,948) (29,468,257) (70,957,205) 45,822,132

795,957,494 (29,468,257) (162,498,006) 603,991,231 45,822,132 133,640,000

66,649,737 158,110,492 224,760,229

862,607,231 (29,468,257) (4,387,514) 828,751,460 45,822,132 133,640,000

267,280,000

541,308,436

11,278,049 (13,857,024)

11,278,049 794,731,412

(11,278,049) 213,482,180

1,008,213,592

The annexed notes 1 to 44 form an integral part of these financial statements.

Lahore August 30, 2011

Jehanzeb Amin Chief Executive

Safder Hussain Tariq Director


for the year ended June 30, 2011

Financial Statements

17

Notes to the Financial Statements


for the year ended June 30, 2011
1 STATUS AND ACTIVITIES Samin Textiles Limited (the Company) was incorporated in Pakistan on November 27, 1989 as a public limited company under the Companies Ordinance, 1984. The registered office of the Company is situated at 50C, Main Gulberg, Lahore and the plant is located at 8th kilometer, Manga Raiwand road, Kasur. The Company is currently listed on Karachi and Lahore stock exchanges in Pakistan. The principal business of the Company is manufacturing and sale of cloth. 2 BASIS OF PREPARATION 2.1 Statement of compliance These financial statements have been prepared in accordance with approved accounting standards as applicable in Pakistan. Approved accounting standards comprise of such International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board as are notified under the Companies Ordinance, 1984, provisions of and directives issued under the Companies Ordinance, 1984. In case requirements differ, the provisions of and directives issued under the Companies Ordinance, 1984 shall prevail. 2.2 Standards, amendments or interpretations that became effective during the year During the year, certain amendments to existing standards and a new interpretation IFRIC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments became effective; however, they did not have any material effect on the financial statements of the Company. 2.3 New / revised accounting standards, amendments to published accounting standards, and interpretations that are not yet effective The following standards, amendments and interpretations of approved accounting standards are only effective for annual periods beginning from the dates specified below. These standards are either not relevant to the Companys operations or are not expected to have significant impact on the Companys financial statements, other than increased disclosures in certain cases: IFRS 9 Financial Instruments: effective for annual periods beginning on or after 1 January 2013. IFRS 10 Consolidated Financial Statements: effective for annual periods beginning on or after 1 January 2013. This IFRS supersedes the requirements relating to consolidated financial statements in IAS 27 Consolidated and Separate Financial Statements (as amended in 2008) and also supersedes SIC12 Consolidation Special Purpose Entities. IFRS 11 Joint Arrangements: effective for annual periods beginning on or after 1 January 2013. This IFRS supersedes IAS 31 Interests in Joint Ventures and SIC 13 Jointly Controlled Entities Non Monetary Contributions by Venturers. IFRS 12 Disclosure of Interests in Other Entities: effective for annual periods beginning on or after 1 January 2013. IFRS 13 Fair Value Measurement: effective for annual periods beginning on or after 1 January 2013. Amendments to IAS 1 Presentation of Financial Statements: these amendments regarding presentation of items of other comprehensive income are effective for annual periods beginning on or after 1 July 2012. IAS 19 Employee Benefits (amended 2011): effective for annual periods beginning on or after 1 January 2013. IAS 24 Related Party Disclosures (revised 2009): effective for annual periods beginning on or after 1 January 2011. IAS 27 Separate Financial Statements (revised 2011): effective for annual periods beginning on or after 1 January 2013. IAS 28 Investments in Associates and Joint Ventures (revised 2011): effective for annual periods beginning on or after 1 January 2013. Amendments to IFRIC 14 IAS 19 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction: effective for annual periods beginning on or after 1 January 2011.

2.4

Accounting convention These accounts have been prepared under the historical cost convention, except for revaluation of free hold land, building on freehold land, and investments at fair value.

2.5

Critical accounting estimates and judgments The preparation of financial statements in conformity with approved accounting standards requires the use of certain critical accounting estimates. It also requires the management to exercise its judgment in the process of applying the Companys accounting policies. Estimates and judgments are continually evaluated and are based on historical experience, including expectation of future events that are believed to be reasonable under the circumstances. The areas where various assumptions and estimates are significant to the Companys financial statements or where judgments were exercised in application of accounting policies are discussed in note 41.

2.6

Functional and presentation currency These financial statements are presented in Pakistani Rupees which is the Companys functional and presentation currency.

18

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
3 SIGNIFICANT ACCOUNTING POLICIES 3.1 Employee benefits Defined contribution plan The Company operates unapproved funded contributory provident fund for all its employees who have completed minimum qualifying period of service as defined under the respective scheme. Equal monthly contributions are made both by the Company and the employees at the rate of 8.33% of basic salary. 3.2 Taxation Current The charge for current taxation is based on taxable income at the current rate of taxation after taking into account applicable tax credit, rebates and exemption available, if any, and tax paid on presumptive basis. Deferred Deferred tax is provided using the balance sheet liability method for all temporary differences at the balance sheet date between tax bases of assets and liabilities and their carrying amount for financial reporting purposes. In this regard the effects on deferred taxation of the portion of income subject to final tax regime is also considered in accordance with the requirement of Technical Release 27 issued by the Institute of Chartered Accountants of Pakistan. Deferred income tax asset is recognized for all deductible temporary differences and carry forward of unused tax losses , if any , to the extent that it is probable that taxable profit will be available against which such temporary differences and tax losses can be utilized. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred tax is charged or credited to the income statements, except in the case of items credited or charged to equity in which case it is included in equity. 3.3 Property, plant and equipment Property, plant and equipment except freehold land and building on freehold land are stated at cost less accumulated depreciation and impairment in value. Freehold land and building on freehold land are stated at revalued amount. Capital work in progress and stores held for capital expenditure are stated at cost less impairment loss, if any. Cost also includes borrowing cost as referred in the relevant accounting policy. Depreciation is charged to income applying the reducing balance method over the estimated useful life at the rates specified in property, plant and equipment note 16. Depreciation on additions is charged from the month the asset is available for use while no depreciation is charged in the month in which the asset is disposed off. The assets residual values and useful lives are reviewed at each financial year end, and adjusted if impact on depreciation is significant. Maintenance and normal repairs are charged to income as and when incurred. Major renewals and improvements are capitalized and the assets so replaced, if any, are retired. Gain or loss on disposal of property, plant and equipment is taken to profit or loss. All expenditure connected with specific assets incurred during installation and construction period are carried under capital work in progress. These are transferred to specific assets as and when these assets are available for use. Any surplus arising on revaluation of property, plant and equipment is credited to the Surplus on revaluation of property, plant and equipment account. Revaluation is carried out sufficiently to ensure that the carrying amount of assets does not differ materially from the fair value. The surplus on revaluation on these assets can only be utilized in the manner specified in section 235 of the Companies Ordinance, 1984 and Notification No. S.R.O.45(I)/2003 dated 13th January, 2003. Capital work in progress is stated at cost less identified impairment loss, if any, and includes the expenditure on material, labour and appropriate overheads directly attributable to the project. These costs are transferred to property, plant and equipment as and when assets are available for their intended use. 3.4 Accounting for finance lease Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. Assets held under finance leases are recognized as assets of the Company at their fair value or, if lower, at the present value of the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the balance sheet as liabilities against assets subject to finance lease. Lease payments are appropriated between finance costs and reduction of the liabilities against assets subject to finance lease so as to achieve a constant rate of interest on the remaining balance of the liability. Finance costs are
for the year ended June 30, 2011

Financial Statements

19

Notes to the Financial Statements


for the year ended June 30, 2011
charged directly against income, unless they are directly attributable to qualifying assets, in which case they are capitalized in accordance with the Companys general policy on borrowing costs. Assets so acquired are amortized over their expected useful life at the rates specified in property, plant and equipment note 16. 3.5 Foreign currencies Transactions in currencies other than Pak rupee are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the balance sheet date except where forward exchange contracts have been entered into wherein the rates contracted for are used. Gains and losses arising on retranslation are included in net profit or loss for the period. 3.6 Markup bearing borrowings and borrowing costs Mark up bearing borrowings are recognised initially at cost, less attributable transaction costs. Subsequent to initial recognition, mark up bearing borrowings are stated at original cost less subsequent repayments, while the difference between the cost (reduced for periodic payments) and redemption value is recognised in the profit or loss over the period of borrowings on an effective mark up basis. Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, if any, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowings, if any, pending their expenditure on qualifying asset is deducted from the borrowing costs eligible for capitalization. All other borrowing costs are recognized as expense in the period in which they are incurred. 3.7 Investments (Availableforsale) Investments intended to be held for an indefinite period of time, which may be sold in response to need for liquidity, or changes to interest rates or equity prices are classified as availableforsale. After initial recognition, investments which are classified as available forsale are measured at fair value. Gains or losses on availableforsale investments are recognized through other comprehensive income until the investment is sold or derecognized, at which time the cumulative gain or loss previously reported is included in profit or loss. All purchases and sales of investments are recognized on the trade date which is the date that the Company commit to purchase or sell the investment. Available for sale investments are subcategorized as under: Quoted For investments that are actively traded in organized capital markets, fair value is determined by reference to stock exchange quoted market bids at the close of business on the balance sheet date. Unquoted These are carried at fair value determined on the basis of appropriate valuations techniques as allowed by IAS 39 Financial Instruments: Recognition and Measurement. 3.8 Investments in associate equity method Entities in which the Company has significant influence but not control and which are neither its subsidiaries nor joint ventures are associates and are accounted for by using the equity method of accounting. These investments are initially recognized at cost, thereafter the carrying amount is increased or decreased to recognize the Companys share of profit or loss of associates. Share of post acquisition profit or loss of associates is accounted for in the Companys profit or loss. Distribution received from investee, reduces the carrying amount of investment. The Companys share of changes in the associates equity which have not been recognized in the associates profit or loss, are recognized directly in the equity of the Company. 3.9 Trade debts and other receivables Trade debts and other receivables are carried at original invoice amount less an estimate made for doubtful receivables based on review of outstanding amounts at period end. Balances considered bad and irrecoverable are written off when identified. 3.10 Cash and cash equivalents Cash and cash equivalents are carried at cost in the balance sheet. For the purpose of cash flow statement, cash and cash equivalents comprise cash in hand, demand deposits and other short term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value. 3.11 Trade and other payables Liabilities for trade and other payables are carried at their cost which is the fair value of the consideration to be paid in the future for goods and services received whether billed to the Company or not. 3.12 Financial instruments Financial assets and liabilities are recognized at the fair value of the consideration given or received at the time when the Company becomes a party to the contractual provisions of the instrument by following the trade date accounting. A financial asset or part thereof is derecognized when the Company loses control of the contractual rights that comprise the financial asset or part thereof. Such control is deemed to be lost if the Company realizes the rights to the benefits specified in the contracts, the right expires or the Company surrenders those rights. A

20

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
financial liability or part thereof is removed from the balance sheet when it is extinguished i.e. when the obligation specified in the contract is discharged, cancelled or expired. A financial asset and financial liability is offset and the net amount is reported in the balance sheet if the Company has a legal enforceable right to set off the transaction and also intends either to settle on a net basis or to realize the asset and settle the liability simultaneously. The particular recognition methods adopted by the Company are disclosed in the individual policy statements associated with each item of financial instruments. 3.13 Noncurrent assets held for sale Noncurrent assets classified as assets held for sale are stated at the lower of carrying amount and fair value less costs to sell if their carrying amount is recoverable principally through a sale transaction rather than through a continuing use. 3.14 Stores, spares and loose tools These are valued at moving average cost except goods in transit, which are valued at cost comprising invoice value plus other charges incurred thereon. 3.15 Stock in trade These are valued at the lower of cost and net realizable value applying the following basis: Raw material Work in process Finished goods Packing material Waste Weighted Average Average manufacturing cost Average manufacturing cost Weighted Average Net realizable value

Raw material in transit is stated at invoice price plus other charges paid thereon up to the balance sheet date. Average manufacturing cost in relation to work in process and finished goods consists of direct material and labor and a proportion of manufacturing overheads based on normal capacity. Net realizable value signifies the estimated selling price in the ordinary course of business less estimated costs of completion and estimated costs necessary to make the sale. 3.16 Revenue recognition Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business. Export sales are accounted for on shipment basis and exchange differences, if any on account of export proceeds are adjusted in the period of realization. Local sales are recorded on dispatch of goods to customers. Rebate income is recognized on accrual basis. Dividend income is recognized when the Companys right to receive payment is established. Interest income is recognized on time proportion basis.

3.17 Provisions Provisions are recognized when the Company has a present legal or constructive obligation as a result of past events and it is probable that out flow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate of the amount can be made. However, provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. 3.18 Related party transactions Transactions with related parties are priced on arms length basis. Prices for these transactions are determined on the basis of comparable uncontrolled price method, which sets the price by reference to comparable goods and services sold in an economically comparable market to a buyer unrelated to the seller. 3.19 Impairment The carrying amounts of the assets are reviewed at each balance sheet date to determine whether there is any indication of impairment of any asset or group of assets. If any such indication exits, the recoverable amount of that asset or group of assets is estimated and impairment loss is recognized in the profit or loss.

for the year ended June 30, 2011

Financial Statements

21

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

ISSUED, SUBSCRIBED AND PAIDUP CAPITAL 4.1 Authorized share capital 30,000,000 ordinary shares of Rs. 10 each 4.2 Issued, subscribed and paidup capital 26,728,000 (2010: 13,364,000) ordinary shares of Rs. 10 each fully paid in cash 267,280,000 267,280,000 4.3 Reconciliation of issued, subscribed and paid up capital Opening balance at 1 July Right shares issued during the year 4.4 13,364,000 13,364,000 26,728,000 4.4 13,364,000 13,364,000 133,640,000 133,640,000 300,000,000 300,000,000

( Number of shares )

This includes 12.266 million shares issued against subordinated loan of directors and remaining 1.098 million shares issued against cash to general public.
Note 2011 Rupees 2010 Rupees

RESERVES Surplus on remeasurement of investment Less: Deferred tax on remeasurement of investment Surplus on remeasurement of investment net of tax Accumulated loss 733,977,541 (192,669,105) 541,308,436 (13,857,024) 527,451,412 733,977,541 (192,669,105) 541,308,436 (70,957,205) 470,351,231

SURPLUS ON REVALUATION OF PROPERTY, PLANT AND EQUIPMENT The surplus on revaluation of property, plant and equipment represents surplus over book value resulting from revaluation of freehold land and building on freehold land. There are two revaluations, both were carried out by an independent valuer M/s Unit 3 consultants. First revaluation had been carried out of freehold land as on March 15, 2006 on the basis of market value, especially in forced sale situation. Second revaluation was carried out of freehold land and building on freehold land as on June 30, 2010 on the basis of market value, especially in forced sale situation. It can only be utilized in the manner specified in section 235 of the Companies Ordinance, 1984 and Notification No. S.R.O.45(I)/2003 dated 13th January, 2003.
Note 2011 Rupees 2010 Rupees

6.1

The revaluation resulted in the followings: Opening balance net of deferred tax Increase in carrying value of freehold land Gross Increase in carrying value of building on freehold land Gross

224,760,229

66,649,737 45,330,000 173,508,449 218,838,449 (60,727,957) 224,760,229

Less: Deferred tax on revaluation surplus building on freehold land Less: Transfer from surplus on revaluation of property, plant and equipmentnet of tax

(11,278,049) 213,482,180

22

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

SUBORDINATED LOAN UNSECURED Opening balance at July 01 Converted into share capital during the year 133,072,075 (122,660,509) 10,411,566 133,072,075 133,072,075

These are interest bearing loans from directors of the Company and are subordinated to the main lenders. The loan was designated as an interest bearing loan with effect from 1st July 2010. During the year, loan amounting to Rs. 122.660 million was converted into share capital.
Note 2011 Rupees 2010 Rupees

LONG TERM FINANCING From banking companies Less: Payable within next twelve months 8.1 14 13,436,163 (10,000,000) 3,436,163 8.1 Salient terms and conditions are as follows:
Description Interest Security Payment Term Amount 2011 (Rupees) Amount 2010 (Rupees)

47,217,923 (35,781,760) 11,436,163

National Bank of Pakistan Demand Finance I Six month average KIBOR ask rate plus 2.5% per annum reset semiannually on the last working day before start of calendar semi annual period. First charge over fixed assets of the Company for Rs. 340 million. 2nd joint Pari Passu charge of Rs. 100 million over fixed assets of the Company and personal guarantee of Mr. Sarmad Amin (sponsoring director of the Company). First charge over fixed assets of the Company for Rs. 340 million. 2nd joint Pari Passu charge of Rs. 100 million over fixed assets of the Company and personal guarantee of Mr. Sarmad Amin (sponsoring director of the Company). Bank had allowed a Moratorium period of twelve months in repayment of principal starting from 112009 to 31092009. After wards the outstanding loan was to be paid in six quarterly installments of Rs. 6.946 million. Maturity date was March 31, 2011. 10 quarterly installments of Rs. 2 million with a grace period of 6 months. 27,781,760

Demand Finance II

Three month average KIBOR ask rate plus 2.5% per annum reset at the beginning of each calender quarter.

13,436,163

19,436,163

Total

13,436,163

47,217,923

LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE This represents plant and machinery obtained under finance lease from various leasing companies. The financing rates used as discounting factor range from 7 % to 18.62% (2010: 7 % to 17.76% ) per annum. Taxes, repairs, replacements and insurance costs are born by the Company. The Company intends to exercise its option to purchase the above assets upon completion of lease period.
Note 2011 Rupees 2010 Rupees

Present value of minimum lease payments Less: current portion

14

17,754,604 (10,293,165) 7,461,439

55,289,760 (47,169,706) 8,120,054

for the year ended June 30, 2011

Financial Statements

23

Notes to the Financial Statements


for the year ended June 30, 2011
The reconciliation between gross minimum lease payments, future financial charges and present value of minimum lease payments is as under:
Particulars Upto one year From one to five year Total 2011 Upto one year From one to five years Total 2010

Rupees
Minimum lease payments Future financial charges Present value of minimun lease payments Less: Current portion shown under current liabilities 11,779,103 (1,485,938) 10,293,165 8,511,805 (1,050,366) 7,461,439 20,290,908 (2,536,304) 17,754,604 (10,293,165) 7,461,439 2011 Rupees 50,897,730 (3,728,024) 47,169,706 9,073,455 (953,401) 8,120,054 59,971,185 (4,681,425) 55,289,760 (47,169,706) 8,120,054 2010 Rupees

Note

10

DEFERRED TAX AND OTHER LIABILITIES Deferred tax Staff gratuity 10.1 10.2 247,324,265 1,574,700 248,898,965 264,666,547 1,692,100 266,358,647

10.1 This represents deferred tax liability arising on surplus on revaluation of property and equipment and remeasurement of available for sale investments to fair value. No provision for deferred tax on temporary differences was considered necessary as the Companys future tax liability is expected to be limited to tax under section 169 and section 113 of the Income Tax Ordinance 2001. Deferred tax asset of Rs. 35.594 arising on account of temporary differences mainly for property and equipment and finance lease liabilities has not been accounted for due to uncertainty regarding its recoverability in the foreseeable future. 10.2 The Company had operated an unfunded gratuity scheme up to the year ended September 30, 1999 covering all its employees who had completed prescribed qualifying period of service. The unfunded gratuity scheme has been substituted by Provident Fund scheme operated by the Company for all employees as defined in note 3.1. This balance of gratuity payable represents the entitlement of current employees as at September 30, 1999, as reduced by the payments made to employees who have left the Company.
Note 2011 Rupees 2010 Rupees

11

TRADE AND OTHER PAYABLES Creditors for goods for supplies for services Accrued expenses Advances from customers Security deposits Withholding tax payable Workers Profit Participation Fund Workers Welfare Fund Provident fund payable Unclaimed dividend 144,441,298 47,342,815 49,633,128 241,417,241 58,836,896 17,927,707 1,313,630 2,858,182 20,133,792 1,891,540 517,120 5,288,284 350,184,392 11.1 Workers Profit Participation Fund Balance at the beginning of the year Paid during the year Interest on funds utilized in Companys business Provision for the year 30,547,238 (15,375,723) 3,072,093 1,890,184 20,133,792 11.2 Mark up on Workers Profit Participation Fund has been provided @ 15 % (2010: 15%) per annum. 34,219,845 (8,776,729) 5,104,122 30,547,238 94,228,263 27,895,437 43,046,472 165,170,172 51,888,073 8,656,207 1,313,630 964,212 30,547,238 631,068 640,787 5,288,284 265,099,671

11.1

11.2

24

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

12

ACCRUED MARKUP Markup accrued on: Long term financing Liabilities against assets subject to finance lease Short term borrowings Interest on sponsors loan 827,013 2,506,995 25,777,912 17,961,613 47,073,533 2,073,674 1,183,164 23,512,454 14,281,823 41,051,115

13

SHORT TERM BORROWINGS From banking companies : Preshipment own sources Postshipment own sources Cash finance 13.2 13.3 389,971,717 46,388,000 257,838,468 694,198,185 370,586,213 18,661,085 259,775,605 649,022,903

13.1 The securities registered with SECP against short term borrowing from one financial institution is utilized for various facilities sanctioned by the said financial institution. 13.2 These are secured against first joint pari passu charge on current assets, second joint pari passu charge on fixed assets of the Company, lien on export bills and personal guarantee of the sponsoring director of the Company and carries markup at the rate, ranging from three to six months KIBOR plus 2.25 % to 3 % per annum (2010: three to six months KIBOR plus 2.25% to 3% per annum). The facilities expire on various dates from September 30, 2011 to November 30, 2011. 13.3 The facility is secured against first joint pari passu charge over present and future assets of the Company for Rs. 260 million and personal guarantee of sponsoring directors of the Company and carries markup at the rate of six month KIBOR average ask rate plus 2.5% per annum (2010: six month KIBOR average ask rate plus 2.5% per annum).
Note 2011 Rupees 2010 Rupees

14

CURRENT PORTION OF LONGTERM BORROWINGS Long term financing Liabilities against assets subject to finance lease 8 9 10,000,000 10,293,165 20,293,165 35,781,760 47,169,706 82,951,466

15

CONTINGENCIES AND COMMITMENTS 15.1 Contingencies The Company through APTMA has obtained a stay order against levy of central excise duty on advances by financial institutions. The case was decided in the High Court in favour of the Company. However, the case is pending for decision in the Honorable Supreme Court of Pakistan and in view of the Companys expectation of a favorable result, the amount deducted in this respect amounting to Rs. 4,367,366 (2010: Rs.4,367,366) has been treated as excise duty receivable. ii) A suit for declaration with consequential relief and damages has been filed against the Company to challenge the purchase of land at Rousa Kasur. The same is pending adjudication before Civil Judge, Kasur. iii) A petition has been filed by the Company challenging calculation and demand of electricity duty. The matter of revised calculations made by the Electricity Inspector of Lahore region is still pending adjudication before the Honorable Lahore High Court, Lahore. iv) A petition has been filed by an exemployee of the Company for reinstatement in service. There is no likelihood of any financial liability there under. The matter is pending adjudication before the Honorable Labour Court, Lahore. v) A petition is pending execution before the Civil Court, Lahore. The Company is making an effort to recover the pending amount from judgment debtors in the said proceedings. vi) During the year, an order u/s 161/205 of the Income Tax Ordinance, 2001 was received from Deputy Commissioner Inland Revenue, RTO I, Lahore for recovery of tax arrears amounting to Rs. 70.868 million for the tax year 2004. The Company is contesting the above order in appeal before the Honorable Appellate Tribunal Inland Revenue, Lahore and is hopeful of the favorable outcome of the case. vii) Guarantees of Rs. 23.3 million (2010: Rs. 23.3 million ) have been given by the banks of the Company to Sui Northern Gas Pipelines Company Limited against gas connection. viii) A petition is pending in the Honorable Lahore High Court, Lahore for waiver of security amounting Rs. 5,355,000 (2010: Rs. 5,355,000) demanded by WAPDA. 15.2 Commitments i) ii) Commitments against foreign bills purchased by bank is Rs. 194.11 million (2010: Rs. 47.6 million). Commitment against irrevocable letters of credit for import of stores and spares is Rs. 0.485 million (2010: Rs. 4.2 million ) at the year end.
for the year ended June 30, 2011

i)

Financial Statements

25

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

16

PROPERTY, PLANT AND EQUIPMENT Operating fixed assets Intangible assets Capital work in process 16.1 Property, plant and equipment 2011
COST As at July 01, 2010 Additions/ (Deletions) Transfers/ adjustments Revaluation Adjustents As at June 30, 2011 Rate % As at July 01, 2010 DEPRECIATION For the year/ Adjustment Transfers/ Ajustments Revaluation Adjustments As at June 30, 2011 Net book value

16.1 & 16.2 16.6 16.7

786,308,845 388,889 2,960,000 789,657,734

835,532,504 2,310,000 837,842,504

DESCRIPTION

Rupees Owned Assets Freehold land Building on freehold land Plant and machinery Furniture and fittings Office equipment Vehicles Electric installation Tube well Arms and ammunition June 30, 2011 127,080,000 224,169,522 868,952,683 6,174,055 23,278,265 27,172,226 25,405,504 786,423 5,500 1,303,024,178 202,646 19,886,291 8,100 1,458,360 2,356,965 (4,972,050) 189,700 24,102,062 (4,972,050) 127,080,000 224,372,168 888,838,974 6,182,155 24,736,625 24,557,141 25,595,204 786,423 5,500 1,322,154,190 10 10 10 10 20 10 10 10 498,946,713 3,436,838 10,508,669 15,959,598 8,959,544 585,102 4,532 538,400,996 22,427,082 38,229,440 273,833 1,332,539 2,176,770 (1,711,196) 1,661,991 20,136 96 66,121,887 (1,711,196)

Rupees

22,427,082 537,176,153 3,710,671 11,841,208 16,425,172 10,621,535 605,238 4,628 602,811,687

127,080,000 201,945,086 351,662,821 2,471,484 12,895,417 8,131,969 14,973,669 181,185 872 719,342,503

Leased Plant and machinery Vehicles Electric Instalation 99,821,877 8,290,000 5,050,000 113,161,877 1,416,186,055 4,261,252 4,261,252 28,363,314 (4,972,050) 99,821,877 12,551,252 5,050,000 117,423,129 1,439,577,319 10 20 10 40,699,555 1,384,668 168,332 42,252,555 580,653,551 5,912,232 1,803,828 488,172 8,204,232 74,326,119 (1,711,196) 46,611,787 3,188,496 656,504 50,456,787 653,268,474 53,210,090 9,362,756 4,393,496 66,966,342 786,308,845

June 30, 2011

16.1 Property, plant and equipment 2010


COST As at July 01, 2009 Additions/ (Deletions) Transfers/ adjustments Revaluation Adjustents As at June 30, 2010 Rate % As at July 01, 2009 DEPRECIATION For the year/ Adjustment Transfers/ Ajustments Revaluation Adjustments As at June 30, 2010 Net book value

DESCRIPTION

Rupees Owned Assets Freehold land Building on freehold land Plant and machinery Furniture and fittings Office equipment Vehicles Electric installation Tube well Arms and ammunition June 30, 2010 81,750,000 131,342,707 838,598,809 6,108,561 19,983,087 35,909,580 (11,154,583) 11,611,613 (5,050,000) 786,423 5,500 1,126,096,280 19,550,391 65,494 3,295,178 2,417,229 18,843,891 44,172,183 (16,204,583) 10,803,483 10,803,483 45,330,000 92,826,815 (3,066,277) 138,156,815 127,080,000 224,169,522 868,952,683 6,174,055 23,278,265 27,172,226 25,405,504 786,423 5,500 1,303,024,178 10 10 10 10 20 10 10 10 75,052,626 455,060,478 3,137,346 9,235,558 16,070,317 8,155,055 562,734 4,424 567,278,538 5,629,008 39,249,456 299,492 1,273,111 2,955,558 804,489 22,368 108 50,233,590 (3,066,277)

Rupees

4,636,779 4,636,779

(80,681,634) (80,681,634)

498,946,713 3,436,838 10,508,669 15,959,598 8,959,544 585,102 4,532 538,400,996

127,080,000 224,169,522 370,005,970 2,737,217 12,769,596 11,212,628 16,445,960 201,321 968 764,623,182

Leased Plant and machinery Vehicles Electric Instalation 110,625,360 8,290,000 5,050,000 110,625,360 June 30, 2010 1,236,721,640 13,340,000 57,512,183 (16,204,583) (10,803,483) 10,803,483 99,821,877 8,290,000 5,050,000 113,161,877 1,416,186,055 10 20 10 38,081,998 38,081,998 605,360,536 7,254,336 1,384,668 168,332 8,807,336 59,040,926 (3,066,277) (4,636,779) (4,636,779) (80,681,634) 40,699,555 1,384,668 168,332 42,252,555 580,653,551 59,122,322 6,905,332 4,881,668 70,909,322 835,532,504

138,156,815

26

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

16.3 Depreciation for the year has been allocated as under: Cost of goods sold Administrative expenses 28 31 70,542,977 3,783,142 74,326,119 54,512,765 4,528,161 59,040,926

16.4 Had there been no revaluation, the cost, accumulated depreciation, and book value of the revalued property, plant and equipment as on June 30, 2011 would have been as follows:
Cost as at June 30, 2011 Accumulated depreciation as at June 30, 2011 Book value as at June 30, 2011

Owned Freehold land Building on freehold land 127,080,000 224,372,168 351,452,168 16.5 Disposal of property, plant and equipment
Cost Description Rupees Accumulated depreciation Net book value Proceeds from Gain on disposal disposal property, plant and equipment Mode of disposal Particulars of buyer

22,427,082 22,427,082

127,080,000 201,945,086 329,025,086

Vehicles Suzuki Cultus LZX 993 Suzuki Baleno LZH 303 Honda Civic LWQ 108 June 30, 2011 Rupees 641,000 774,000 1,289,050 2,704,050 428,405 545,386 737,405 1,711,196 212,595 228,614 551,645 992,854 450,000 600,000 725,000 1,775,000 237,405 371,386 173,355 782,146 Negotiation Negotiation Negotiation Mr. Tahir Usman Mr. Shahid Mr. Syed Wasi

Note

2011 Rupees

2010 Rupees

16.6 Intangible Assets Licenses Acquired during the year Less: Amortized during the year The license is amortized on its useful life of three years on a straight line basis. 16.7 Capital work in process SAP implementation phase Opening Addition during the year Closing balance 2,310,000 650,000 2,960,000 2,310,000 2,310,000 400,000 (11,111) 388,889

This represents the amount paid to the consultant for the implementation of SAP Enterprise Resource Planning (ERP) solution.
Note 2011 Rupees 2010 Rupees

17

INVESTMENT IN EQUITY ACCOUNTED INVESTEE Onetel Pakistan Private Limited 18.1 2,150,000 2,150,000

17.1 This represents the Companys investment in the associated company, Onetel Pakistan (Private) Limited. The Company has common directorship with the associate and hold 24% equity in the associate while Rs. 1,150,000 is held as share deposit money. The associated company has not yet commenced operations and the breakup value per share based on the unaudited accounts works out to Rs. 10 per share at 30th June 2011 (2010: Rs. 10).

for the year ended June 30, 2011

Financial Statements

27

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

18

LONG TERM DEPOSITS Long term deposits 18.1 Long term deposits represent security deposits against the finance leases. 18.1 4,276,739 7,872,913

19

STORES, SPARES AND LOOSE TOOLS Stores and spares 19.1 53,612,243 44,386,029

19.1 Stores and spares include items which may result in fixed capital expenditures but are not distinguishable.
Note 2011 Rupees 2010 Rupees

20

STOCK IN TRADE Raw materials Work in process Finished goods 31,169,162 16,286,729 309,521,413 356,977,304 44,682,284 9,163,006 277,152,844 330,998,134

20.1

20.1 This includes goods in transit amounting to Rs. Nil (2010: Rs. 43,729,183). At the year end, stock in trade has been valued at net realizable value.
Note 2011 Rupees 2010 Rupees

21

TRADE DEBTS Export secured against export documents Local unsecured considered good Less: Provision for doubtful debts 196,690,289 48,770,492 245,460,781 (4,043,111) 241,417,670 49,966,108 63,515,050 113,481,158 (4,043,111) 109,438,047

22

LOANS AND ADVANCES Advances to: Staff secured Suppliers and for services unsecured considered good Letters of credit Advance income tax Sales tax refundable 812,658 12,083,328 489,266 29,485,158 26,762,832 69,633,242 916,873 9,236,835 2,211,918 31,839,052 40,074,016 84,278,694

23

TRADE DEPOSITS Security deposits 8,266,563 8,266,563

24

INVESTMENTS (AvailableforSale) Security General Insurance Company Limited 10,214,914 fully paid ordinary shares 24.1 836,600,967 836,600,967 24.1 This is madeup as under: Transferred from investment in associates Transferred from noncurrent assets classified as held for sale in 2008 Add: Adjustment arising from measurement to fair value 91,085,164 11,538,263 733,977,541 836,600,968 24.2 As the management intends to sell this investment, this has been classified under current assets. 24.3 Fair value of available for sale unquoted investment is determined by using appropriate valuation techniques as permissible under IAS 39 (Financial Instruments: Recognition and Measurement). 836,600,968 836,600,968 91,085,164 11,538,263 733,977,541 836,600,968

28

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
24.4 The investee is associate of the Company due to common directorship. The Company holds 15% (2010: 15%) of the investee companys total equity. This has not been accounted for using equity method as the Company does not have significant influence over the investee.
Note 2011 Rupees 2010 Rupees

25

OTHER RECEIVABLES UNSECURED CONSIDERED GOOD Export rebate receivable Excise duty receivable Other receivables 1,916,480 4,479,873 228,841 6,625,194 1,518,409 4,456,128 1,564,254 7,538,791

26

CASH AND BANK BALANCES Cash with banks on: current accounts PLS accounts foreign currency accounts 17,765,947 1,078,776 1,564,730 20,409,453 Cash in hand 543,890 20,953,343 26.1 The effective rate of return in respect of PLS and foreign currency account ranges from 3% to 5% (2010: 3% to 5%).
Note 2011 Rupees 2010 Rupees

26.1

6,315,880 7,562,178 1,564,730 15,442,788 1,048,123 16,490,911

27

SALES net Export: Cloth Rebate Local gross Cloth Waste 959,783,792 6,742,616 966,526,408 Commission 3,120,234,385 (23,750,646) 3,096,483,739 878,783,874 3,751,000 882,534,874 1,824,106,127 (13,429,535) 1,810,676,592 2,153,079,130 628,847 2,153,707,977 941,304,012 267,241 941,571,253

for the year ended June 30, 2011

Financial Statements

29

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

28

COST OF GOODS SOLD Raw materials consumed Power and fuel Stores, spares and loose tools consumed Salaries, wages and other benefits Processing charges Repairs and maintenance Communication Insurance Depreciation Traveling and conveyance Other expenses Adjustment of work in process Opening work in process Closing work in process 9,163,006 (16,286,729) (7,123,723) 2,834,300,169 Adjustment of finished goods Opening stock Fabric purchases Closing stock 277,152,844 3,266,040 (309,521,413) (29,102,529) 2,805,197,640 28.1 Raw materials consumed Opening stock Purchases Closing stock 44,682,284 2,351,823,789 2,396,506,073 (31,169,162) 2,365,336,911 28.2 This includes employees benefits amounting to Rs. 1,180,300 (2010: Rs. 1,870,330). 48,627,112 1,375,780,987 1,424,408,099 (44,682,284) 1,379,725,815 285,351,617 (277,152,844) 8,198,773 1,729,173,346 11,242,169 (9,163,006) 2,079,163 1,720,974,573 28.1 2,365,336,911 146,191,796 145,196,489 93,737,697 3,054,502 4,200,788 341,534 1,736,633 70,542,977 1,307,042 9,777,523 2,841,423,892 1,379,725,815 91,866,908 97,459,789 71,710,055 5,188,319 5,415,855 372,930 2,474,507 54,512,765 998,401 9,170,066 1,718,895,410

28.2

16.1

29

OTHER OPERATING INCOME Income from financial assets Profit on PLS and foreign currency accounts Income from investments Profit on realization of investment Dividend income Income from assets other than financial assets Gain on disposal of property, plant and equipment Other income 782,146 64,953 27,110,111 201,694 1,298,566 135,141,530 25,537,285 110,920,868 22,564,828 725,727 155,574

30

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

30

DISTRIBUTION COST Salaries and other benefits Outward freight Cloth export expenses Traveling and conveyance Communication Vehicle running and maintenance Other selling expenses 30.1 10,363,347 37,697,817 606,031 8,987,010 798,248 1,313,031 821,461 60,586,945 30.1 This includes employees benefits amounting to Rs. 811,521 ( 2010: Rs. 668,484). 8,655,523 20,113,842 495,921 7,073,746 741,577 1,612,543 477,024 39,170,176

31

ADMINISTRATIVE EXPENSES Salaries, wages and other benefits Office rent Repairs and maintenance Insurance Printing and stationery Communication Electricity, gas and water Traveling and conveyance Entertainment Fee and subscription Legal and professional Vehicle running and maintenance Provision for doubtful debts Auditors remuneration Depreciation Amortization Miscellaneous 31.1 22,233,411 900,000 1,139,787 3,619,733 1,073,021 647,037 1,305,267 2,371,090 344,436 4,147,600 1,005,595 339,319 650,000 3,783,142 11,111 2,253,774 45,824,323 31.1 This includes employees benefits amounting to Rs. 417,312 ( 2010: Rs. 400,457). 31.2 Auditors remuneration includes services for audit of annual financial statements, limited review of condensed interim financial statements for the sixmonth period, review report on Statement of Compliance with Best Practices of Code of Corporate Governance and other certifications.
Note 2011 Rupees 2010 Rupees

31.2 16.1

18,287,567 900,000 893,317 3,492,190 805,133 631,902 1,321,098 1,186,588 152,793 1,326,746 1,755,850 606,944 4,043,111 650,000 4,528,161 2,227,976 42,809,376

32

OTHER OPERATING EXPENSES Interest on Workers Profit Participation Fund Foreign currency translation differences Donations Provision for Workers Profit Participation Fund Provision for Workers Welfare Fund 11.1 32.1 3,072,093 4,664,550 125,000 1,890,184 1,260,472 11,012,299 32.1 No director or his spouse had any interest in the donee. 5,104,122 1,619,044 6,723,166

33

FINANCE COST Mark up on: Long term financing Liabilities against assets subject to finance lease Short term borrowings Bank charges and others Interest on sponsors loan 4,796,807 5,188,873 106,428,595 13,289,049 9,506,179 139,209,503 6,949,070 6,977,815 98,449,621 8,136,635 20,976,012 141,489,153
Financial Statements

for the year ended June 30, 2011

31

Notes to the Financial Statements


for the year ended June 30, 2011
Note 2011 Rupees 2010 Rupees

34

PROVISION FOR TAXATION For the year Current Deferred 33,283,289 (17,342,281) 15,941,008 15,921,162 15,921,162

34.1 The Company is under the ambit of final tax up to the extent of export sales under section 169 of Income Tax Ordinance, 2001. Provision for income tax is made accordingly. Income tax provision for income which is not subject to final tax under section 169 of Income Tax Ordinance, 2001 has been calculated in accordance with section 113 of the Income Tax Ordinance, 2001 as the Company has assessed tax losses. No provision for deferred tax has been charged except as explained in note: 10. The relationship between tax expense and accounting profit has not been presented in these financial statements as the total income falls under: (a) turnover tax provided under section 113; (b) tax on dividend income under section 5 of the Income Tax Ordinance, 2001. 35 REMUNERATION OF CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES
CHIEF EXECUTIVE June 30, 2011 June 30, 2010 DIRECTORS June 30, 2011 Rupees June 30, 2010 EXECUTIVES June 30, 2011 June 30, 2010

Remuneration Utilities House rent Total Number of person (s)

1,920,000 217,800 862,200 3,000,000 1

1,920,000 217,800 862,200 3,000,000 1

4,904,712 516,271 2,056,085 7,477,068 3

5,231,008 523,101 2,092,403 7,846,512 4

8,177,626 817,763 3,271,050 12,266,439 12

5,456,088 545,609 2,182,435 8,184,132 8

35.1 In addition, chief executive, directors and executives are provided with free use of company owned and maintained cars. 35.2 Provident fund contribution are made by the Company @ 8.33% (2010: 8.33%) on the basic salary of directors and executive. 35.3 Chief executive is provided with mobile phone, private security guard at residence and medical facilities.
Note 2011 Rupees 2010 Rupees

36

EARNING / (LOSS) PER SHARE BASIC AND DILUTED Earnings per share is calculated by dividing profit / (loss) after tax for the period by weighted average number of shares outstanding during the period as follows: Profit / (loss) after tax Weighted average number of ordinary shares Earnings / (loss) per share basic and diluted 45,822,132 20,100,920 2.28 (29,468,257) 13,364,000 (2.21)

No figure for diluted earnings per share has been presented as the Company has not issued any instruments carrying options which would have an impact on earnings per share when exercised. 37 FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES The Companys exposure to interest rate risk on its financial assets and liabilities at the balance sheet date based on contractual repricing or maturity dates, whichever is earlier are summarized as follows:

32

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
37.2 Financial assets and liabilities
Interest / markup bearing Maturity upto one year Maturity after one year Sub total Non interest / markup bearing Maturity up to one year Rupees Maturity after one year Subtotal Grand total 2011

Financial assets Trade debts Investments Other receivables Cash and bank balances 1,078,776 1,078,776 Financial liabilities Long term financing Liabilities against assets subject to finance lease Trade and other payables Accrued markup Short term borrowings 10,000,000 10,293,165 694,198,185 714,491,350 On balance sheet gap 2011 Off balance sheet items Commitment against bills purchased Letters of credit for import of stores and spares Off balance sheet gap 2011 194,110,000 485,883 194,595,883 194,110,000 485,883 194,595,883 194,110,000 485,883 194,595,883 (713,412,574) 3,436,163 7,461,439 10,897,602 (10,897,602) 13,436,163 17,754,604 694,198,185 725,388,952 (724,310,176) 306,059,541 47,073,533 353,133,074 749,032,082 10,411,566 10,411,566 (10,411,566) 10,411,566 306,059,541 47,073,533 363,544,640 738,620,516 23,847,729 17,754,604 306,059,541 47,073,533 694,198,185 1,088,933,592 14,310,340 1,078,776 1,078,776 245,460,781 836,600,967 228,841 19,874,567 1,102,165,156 245,460,781 836,600,967 228,841 19,874,567 1,102,165,156 245,460,781 836,600,967 228,841 20,953,343 1,103,243,932

Interest / markup bearing Maturity upto one year Maturity after one year Sub total

Non interest / markup bearing Maturity up to one year Rupees Maturity after one year Subtotal Grand total 2010

Financial assets Trade debts Investments Other receivables Cash and bank balances 7,562,178 7,562,178 Financial liabilities Long term financing Liabilities against assets subject to finance lease Trade and other payables Accrued markup Short term borrowings 35,781,760 47,169,706 649,022,903 731,974,369 On balance sheet gap 2010 Off balance sheet items Commitment against foreign bill purchased Letters of credit for import of stores and spares and plant and machinery Off balance sheet gap 2010 47,000,000 4,273,532 51,273,532 47,000,000 4,273,532 51,273,532 47,000,000 4,273,532 51,273,532 (724,412,191) 11,436,163 8,120,054 19,556,217 (19,556,217) 47,217,923 55,289,760 649,022,903 751,530,586 (743,968,408) 222,987,316 41,051,115 264,038,431 696,536,681 133,072,075 133,072,075 (133,072,075) 133,072,075 222,987,316 41,051,115 397,110,506 563,464,606 180,289,998 55,289,760 222,987,316 41,051,115 649,022,903 1,148,641,093 (180,503,802) 7,562,178 7,562,178 113,481,158 836,600,968 1,564,254 8,928,733 960,575,113 113,481,158 836,600,968 1,564,254 8,928,733 960,575,113 113,481,158 836,600,968 1,564,254 16,490,911 968,137,291

for the year ended June 30, 2011

Financial Statements

33

Notes to the Financial Statements


for the year ended June 30, 2011
EFFECTIVE INTEREST RATES Financial liabilities Long term financing Liabilities against leased assets Short term borrowings Financial assets Cash with banks on saving accounts 3% to 5% per annum 14.87% to 16.12% per annum 7% to 18.62% per annum 14.83% to 18.62% per annum

The Company has exposures to the following risks from its use of financial instruments: Credit risk Liquidity risk Market risk The Board of Directors have overall responsibility for the establishment and oversight of Companys risk management framework. The Board is also responsible for developing and monitoring the Companys risk management policies. Credit risk and concentration of credit risk Credit risk represents the accounting loss that would be recognized at the reporting date if counter parties fail completely to perform as contracted. Credit risk arises from cash and cash equivalents, deposits with banks and financial institution, as well as credit exposures to customers, including trade receivables and committed transactions. Out of total financial assets of Rs. 1,103.243 million (2010: Rs. 968.137 million), the financial assets that are subject to credit risk amounted to Rs. 266.099 million (2010: Rs. 130.488 million). For trade receivables, internal risk assessments process determines the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal and external ratings in accordance with the limits set by the management. The utilization of credit limit is regularly monitored. Accordingly, the credit risk is minimal and the Company also believes that it is not exposed to major concentration of credit risk. Concentration of the credit risk arises when the number of counter parties are engaged in similar business activities or have similar economic features that would cause their abilities to meet contractual obligation to be similarly effected by the changes in economic, political or other conditions. The Company believes that it is not exposed to major concentration risk. The carrying amount of the financial assets represents the maximum credit exposure before any credit enhancements. The maximum exposure to credit risk at the reporting date is:
Note 2011 Rupees 2010 Rupees

Trade debts Other receivables Bank balances

245,460,781 228,841 20,409,453 266,099,075

113,481,158 1,564,254 15,442,788 130,488,200

The breakup of amount due from customers other than related parties as stated in note 21 is presented below. Due from foreign customers Due from local customers 196,690,289 48,770,492 245,460,781 No provision for doubtful debt has been made during the year for foreign and local customers. Liquidity risk Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Companys approach to managing liquidity is to ensure as far as possible to always have sufficient liquidity to meet its liabilities when due. The Company is not materially exposed to liquidity risk as substantially all obligations / commitments of the Company are short term in nature and are restricted to the extent of available liquidity. In addition, the Company has obtained running finance facilities from various commercial banks to meet any deficit, if required to meet the short term liquidity commitments. Market risk Market risk is the risk that changes in market price, such as foreign exchange rates, interest rates and equity prices will affect the Companys income or the value of its holdings of financial instruments. 49,966,108 63,515,050 113,481,158

34

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
Currency risk The Company is exposed to currency risk on import of raw materials and stores and spares and export of goods mainly denominated in US dollars and on foreign currency bank accounts. The Companys exposure to foreign currency risk for US Dollars is as follows:
Note 2011 Rupees 2010 Rupees

Foreign debtors Foreign currency bank account Gross balance sheet exposure Letters of credit Net exposure The following significant exchange rates have been applied: 2011 USD to PKR Sensitivity analysis 85.52 Average rate

196,690,289 1,564,730 198,255,019 489,266 198,744,285

49,966,108 1,564,730 51,530,838 2,211,918 53,742,756 Reporting date rate 2011 85.63 2010 85.40

2010 84.03

At reporting date, if the PKR had strengthended by 10% against the US Dollar with all other variables held constant, posttax profit for the year would have been higher by the amount shown below, mainly as a result of net foreign exchange gain on translation of foreign currency bank account and foreign creditors. Effect on profit or loss
2011 Rupees 2010 Rupees

USD

466,455

161,904

The weakening of the PKR against US Dollar would have had an equal but opposite impact on the post tax profit for the year. The sensitivity analysis prepared is not necessarily indicative of the effects on profit for the year and assets / liabilities of the Company. Interest rate risk At the reporting date the interest rate profile of the Companys significant interest bearing financial instruments was as follows: 2011 Effective rate in percentage Financial liabilities Variable rate instruments Long term loans and lease Short term borrowings Cash flow sensitivity analysis for variable rate instruments A change of 100 basis points in interest rates at the reporting date would have decreased / (increased) profit for the year by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis is performed on the same basis for 2010. Profit and loss 100 bp Increase As at 30 June 2011 Cash flow sensitivityVariable rate financial liabilities As at 30 June 2010 Cash flow sensitivityVariable rate financial liabilities 8,846,027 (8,846,027) 7,358,005 (7,358,005) decrease 7 to 18.62 14.83 to 18.62 7 to 15.25 14.83 to 17.54 41,602,333 694,198,185 235,579,758 649,022,903 2010 2011 Carrying amount Rupees 2010

The sensitivity analysis prepared is not necessarily indicative of the effects on profit for the year and assets / liabilities of the Company.

for the year ended June 30, 2011

Financial Statements

35

Notes to the Financial Statements


for the year ended June 30, 2011
Fair value of financial instruments The carrying values of the financial assets and financial liabilities approximate their fair values. Fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arms length transaction. Capital risk management The Companys objectives when managing capital are to safeguard the entitys ability to continue as a going concern, so that it can continue to provide adequate returns for shareholders and benefits for other stakeholders; and to maintain a strong capital base to support the sustained development of its businesses. The Company manages its capital structure which comprises capital and reserves by monitoring return on net assets and makes adjustments to it in the light of changes in economic conditions. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividend paid to shareholders, appropriation of amounts to capital reserves and/or issue new shares. Consistent with others in the industry, the Company manages its capital risk by monitoring its debt levels and liquid assets and keeping in view future investment requirements and expectations of the shareholders. Debt is calculated as total borrowings (long term loan and short term borrowings as shown in the balance sheet). Total capital comprises shareholders equity as shown in the balance sheet under share capital and reserves and net debt. The salient information relating to capital risk management of the Company as of June 30, 2011 and 2010 were as follows:
Note 2011 Rupees 2010 Rupees

Total borrowings Less: Cash and cash equivalents Net debt Total equity Total capital Gearing ratio

735,800,518 20,953,343 714,847,175 794,731,412 1,509,578,587 47.35


2011 Rupees

884,602,661 16,490,911 868,111,750 603,991,232 1,472,102,982 58.97


2010 Rupees

Note

38

CASH GENERATED FROM OPERATIONS Profit / (loss) before taxation Adjustments for noncash charges and other items: Depreciation on property, plant and equipment Amortization Gain on disposal of property, plant and equipment Gain on disposal of investment Markup on Workers Profit Participation Fund Provision of Workers Profit Participation Fund Provision of Workers Welfare Fund Dividend income Foreign exchange differences Finance cost Working capital changes 38.1 Working capital changes (Increase) / decrease in current assets Stores, spares and loose tools Stock in trade Trade debts Trade deposits Loans and advances Other receivables Decrease in current liabilities Trade and other payables 74,326,119 11,111 (782,146) 3,072,093 (25,537,285) 725,727 139,209,503 (54,237,608) 198,550,654 59,040,926 (201,694) (110,920,868) 5,104,122 (22,564,828) 1,619,044 141,489,153 11,985,680 72,004,441 61,763,140 (13,547,095)

38.1

(9,226,215) (25,979,170) (131,979,623) 14,645,452 913,597 (151,625,959) 97,388,351 (54,237,608)

(3,672,494) 14,222,764 8,661,915 (5,355,000) (5,049,456) (1,534,478) 7,273,250 4,712,431 11,985,680

36

Samin Textiles Limited

Notes to the Financial Statements


for the year ended June 30, 2011
39 TRANSACTIONS WITH RELATED PARTIES Related parties comprise associated undertaking, companies where directors also held directorship, directors and key management personnel. Transactions with associated undertakings and other related parties other than remuneration and benefits to key management personnel under the terms of their employment as disclosed in Note 35 are as follows:
Note 2011 Rupees 2010 Rupees

Onetel Pakistan (Private) Limited Investment Security General Insurance Company Limited Investment Dividend income MCB Bank Limited Interest income Mrs. Mehwish Amin Office rent Areva T & D (Pakistan) Pvt. Limited Purchase of electrical equipment

2,150,000 836,600,967 25,537,285 32,403 900,000

2,150,000 836,600,968 22,564,828 155,574 900,000 5,660,999

39.1 Transactions with related parties are carried out at arms length price determined in accordance with comparable uncontrolled price method.
2011 2010

40

CAPACITY INSTALLED AND ACTUAL PRODUCTION Number of looms installed Number of looms worked Shifts per day No. of days actually worked Rated capacity (running meters) per annum Actual commercial production (running meters) 189 189 3 360 24,193,067 19,167,084 189 189 3 360 23,869,561 14,351,638

It is difficult to determine precisely the production / rated capacity in the textile industry since it fluctuates widely depending on various factors such as speed, width and construction of the cloth, etc. The reasons for increase in actual commercial production include factors like manufacturing different qualities, speed, width and construction of the cloth, etc. 41 ACCOUNTING ESTIMATES AND JUDGEMENTS Income taxes In making the estimates for income taxes currently payable by the Company, the management looks at the current income tax law and the decisions of appellate authorities on certain issues in the past. Trade debts and other receivables Impairment loss against doubtful trade and other debts is made on a judgment basis, which provisions may differ in the future years based on the actual experience. The difference in provision if any, is recognized in the future period. Property, plant and equipment The Companys management determines the estimated useful lives and related depreciation charge for its plant and equipment. The estimates for revalued amounts of different classes of property, plant and equipment are based on valuation performed by external professional values and recommendations of technical teams of the Company. The said recommendation also include estimates with respect to residual values and depreciable lives. Further, the Company reviews the values of the assets for possible impairment on an annual basis. Any change in the estimate in the future years might affect the carrying amounts of the respective item of property, plant and equipment with a corresponding affect on the depreciation charge and impairment. Stock in trade and stores, spares and loose tools The Companys management reviews the net realizable value (NRV) and impairment of stock in trade and stores and spares to access any diminution in the respecting carrying values and wherever required provision for NRV / impairment is made. The difference in provision, if any, is recognised in the future period.

for the year ended June 30, 2011

Financial Statements

37

Notes to the Financial Statements


for the year ended June 30, 2011
2011 2010

42

NUMBER OF EMPLOYEES Number of employees at year end. 620 605

43

DATE OF AUTHORIZATION FOR ISSUE These financial statements have been approved by the Board of Directors of the Company and authorized for issue on August 30, 2011.

44

GENERAL Figures have been rounded off to the nearest rupee. Corresponding figures have been rearranged where ever considered necessary for the purpose of better presentation.

Lahore August 30, 2011

Jehanzeb Amin Chief Executive

Safder Hussain Tariq Director

38

Samin Textiles Limited

Pattern of Shareholding
1. 2. 3. 4. Incorporation Number Name of the Company

The Companies Ordinance, 1984 (Section 236(1) and 464)

SAMIN TEXTILES LIMITED 30062011 Shareholding From To 100 500 1,000 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 55,000 65,000 105,000 120,000 140,000 165,000 185,000 270,000 380,000 460,000 500,000 575,000 700,000 855,000 900,000 1,100,000 1,605,000 3,550,000 12,525,000 Shares Held 1,893 103,332 68,365 289,297 199,993 162,963 144,486 142,370 279,155 66,800 120,000 81,167 142,720 51,000 61,476 310,572 119,749 139,945 164,500 181,000 267,500 376,160 458,764 1,000,000 573,044 697,000 854,000 898,300 1,095,067 1,604,838 3,548,933 12,523,611 26,728,000 Share held 18,530,504 0 143,549 2,146,869 1,551,000 0 16,572,544 3,355,274 Percentage 69.3299% 0.0000% 0.5371% 8.0323% 5.8029% 0.0000% 62.0044% 12.5534% 1 101 501 1,001 5,001 10,001 15,001 20,001 25,001 30,001 35,001 40,001 45,001 50,001 60,001 100,001 115,001 135,001 160,001 180,001 265,001 375,001 455,001 495,001 570,001 695,001 850,001 895,001 1,095,001 1,600,001 3,545,001 12,520,001

Pattern of holding of the shares held by the shareholders as at No. of Shareholdings 59 214 70 99 25 13 8 6 10 2 3 2 3 1 1 3 1 1 1 1 1 1 1 2 1 1 1 1 1 1 1 1 536

5. 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8

Categories of Shareholders Directors, Chief Executive Officers, and their spouse and minor childern Associated Companies, undertakings and related parties. NIT and ICP Banks Development Financial Institutions, Non Banking Financial Institutions. Insurance Companies Modarabas and Mutual Funds Share holders holding 10% General Public a. Local b. Foreign Others (to be specified) Joint Stock Companies Signature of Company Secretary Name of Signatory Designation NIC Number Date 30

5.9 6. 7. 8. 9. 10

1,000,804 SAFDER HUSSAIN TARIQ Company Secretary 06 2011

3.7444%

for the year ended June 30, 2011

Financial Statements

39

Categories of Shareholders
As Required Under C.C.G. As on June 30, 2011
S. No. 1 2 3 4 5 6 7 8 NAME MR. SARMAD AMIN MR. SARMAD AMIN (CDC) MR. SARMAD AMIN (CDC) MR. SAFDER HUSSAIN TARIQ MR. JEHANZEB AMIN (CDC) MR. ASAD AHMED JAN MR. TARIQ JILLANI MR. JAMIL MASUD MR. TARIQ ALI MRS. MEHVASH AMIN W/O SARMAD AMIN MRS. MEHVASH AMIN W/O SARMAD AMIN (CDC) MRS. MEHVASH AMIN W/O SARMAD AMIN (CDC) HOLDING 3,548,933 12,523,611 500,000 500 181,000 500 500 500 500 898,300 500,000 376,160 18,530,504 0 3,604 139,945 143,549 % AGE 13.2780% 46.8558% 1.8707% 0.0019% 0.6772% 0.0019% 0.0019% 0.0019% 0.0019% 3.3609% 1.8707% 1.4074% 69.3299% 0.0000% 0.0135% 0.5236% 0.5371% DIRECTORS, CEO THEIR SPOUSES & MINOR CHILDREN

ASSOCIATED COMPANIES NIT & ICP 1 2 NATIONAL INVESTMENT TRUST LIMITED. (CDC) NATIONAL BANK OF PAKISTAN TRUSTEE DEPTT.(CDC)

BANKS, DEVELOPMENT FINANCE INSTITUTIONS, NON BANKING FINANCE INSTITUTIONS 1 2 3 4 5 THE BANK OF PUNJAB TREASURY DIVISION. (CDC) NATIONAL BANK OF PAKISTAN.(CDC) NATIONAL BANK OF PAKISTAN.(CDC) HABIB BANK AG ZURICH, ZURICH, SWITZERLAND (CDC) SAUDI PAK INV. CO. (CDC) 29,945 13,322 1,604,838 40,000 458,764 2,146,869 0.1120% 0.0498% 6.0043% 0.1497% 1.7164% 8.0323%

INSURANCE COMPANIES 1 2 EFU GENERAL INSURANCE LIMITED. (CDC) EFU LIFE ASSURANCE LTD. (CDC) 854,000 697,000 1,551,000 0 3.1952% 2.6078% 5.8029% 0.0000%

MODARABAS & MUTUAL FUNDS JOINT STOCK COMPANIES 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 ALI HUSAIN RAJABALI LTD. (CDC) B & B SECURITIES (PVT.) LIMITED. (CDC) DARSON SECURITIES (PVT) LIMITED (CDC) DARSON SECURITIES (PVT) LIMITED (CDC) DOSSLANIS SECURITIES (PVT) LTD. (CDC) FAIR EDGE SECURITIES (PVT) LTD. (CDC) FAIRTRADE CAPITAL SECURITIES (PVT.)LTD. (CDC HK SECURITIES (PVT) LTD. (CDC) INVEST CAPITAL MARKETS LTD. (CDC) JAMSHAID & HASAN SECURITIES (PVT) LTD.(CDC) KOHINOOR MILLS LIMITED KOHINOOR TEXTILE MILLS LIMITED (CDC) KSR STOCK BROKERAGE (PVT) LTD. (CDC) MONEY LINE SECURITIES (PVT) LIMITED (CDC) MOONACO SECURITIES (PVT) LTD. (CDC) MUHAMMAD AHMAD NADEEM SECURITIES (SMCPVT) LTD. (CDC) PEARL SECURITIES LIMITED. (CDC) PROGRESIVE SECURITIES (PVT) LTD. (CDC) S.Z. SECURITIES (PVT) LTD. (CDC) SEVEN STAR SECURITIES (PVT) LTD. (CDC) STOCK MASTER SECURITIES (PVT) LTD. (CDC)

19,996 500 1,002 498 15,000 1,000 1,000 500 5,500 1,000 500 30,000 51,000 573,044 25,000 1,000 164,500 3,998 475 104,791 500 1,000,804 3,355,274 26,728,000

0.0748% 0.0019% 0.0037% 0.0019% 0.0561% 0.0037% 0.0037% 0.0019% 0.0206% 0.0037% 0.0019% 0.1122% 0.1908% 2.1440% 0.0935% 0.0037% 0.6155% 0.0150% 0.0018% 0.3921% 0.0019% 3.7444% 12.5534% 100.0000%

SHARES HELD BY THE GENERAL PUBLIC TOTAL: SHAREHOLDERS HOLDING 10% OR MORE OF TOTAL CAPITAL 1 MR. SARMAD AMIN

16,572,544 16,572,544

62.0044% 62.0044%

During the financial year the trading in shares of the company by the Directors, CEO, CFO, Company Secretary and their spouses and minor children is as follows S. No. 1 2 NAME MR. SARMAD AMIN MRS. MEHWISH AMIN W/O SARMAD AMIN SALE PURCHASE 2,190,133 RIGHT SHARES 12,523,611 376,160

40

Samin Textiles Limited

Form of Proxy
Samin Textiles Limited

I/We of at Folio No. ordinary shares hereby appoint Mr./Mrs./Miss who is also a member of the Company, as my/our proxy in my/our absence to attend and vote for me/us and on my/our behalf at the 22nd Annual General Meeting of the Company at the Registered Office of the Company, 50C, Main Gulberg, Lahore on Saturday, October 15, 2011 at 3:00 p.m. or at any adjournment thereof. being member(s) of SAMIN TEXTILES LIMITED registered holder of

As witness my/our hand this signed by the said

day of 2011 in the presence of

1. Witness: Signature Name Address

Affix Revenue Stamps of Rs. 5/

Signature of Member

2. Witness: Signature Name Address Shareholders Folio No. CDC Participant I.D/Sub A/c # CNIC No.

NOTES: 1. 2. 3. Proxies, in order to be effective, must be received at the Companys Registered Office 50C, Main Gulberg, Lahore, not less than 48 hours before the time for holding the meeting and must be duly stamped, signed and witnessed. Signature must agree with the specimen signature registered with the Company. An individual beneficial owner of CDC, entitled to attend an vote at this meeting, must bring his/her NIC/Passport to prove his/her identity, and in case of proxy must enclosed an attested copy of his/her NIC/Passport. Representative of corporate members should bring the original usual documents required of such purpose. No person shall act as proxy unless he is member of the Company.

4.

Board of Directors Mr. Sarmad Amin Chairman Mr. Jehanzeb Amin Chief Executive Mr. Safder Hussain Tariq Mr. Tariq Ali Mr. Tariq Jillani Mr. Asad Ahmad Jan Mr. Jamil Masud Chief Financial Officer Mr. Safder Hussain Tariq Company Secretary Mr. Safder Hussain Tariq Chief Internal Auditor Mr. Muhammad Zubair Auditors Anjum Asim Shahid Rahman Chartered Accountants Legal Advisors Imtiaz Siddiqui & Associates Audit Committee Mr. Jamil Masud Mr. Tariq Jilani Mr. Asad Ahmad Jan Miss Saila Siddique Chairman Member Member Secretary

Bankers National Bank of Pakistan Askari Bank Limited Bank Alfalah Limited My Bank Limited NIB Bank Limited Allied Bank Limited PakKuwait Investment Co. Limited Orix Leasing Pakistan Limited Share Registrars Corplink (Pvt) Limited Wings Arcade, 1K, Commercial Model Town, Lahore, Pakistan. Tel: 92 42 35839182 Fax: 92 42 35869037 Registered/Head Office 50C, Main Gulberg, Lahore, Pakistan. Tel: 92 42 35753761 Fax: 92 42 35753688 Mills 8th Kilometer, MangaRaiwaind Road, District Kasur, Pakistan. Tel: 0334 4285016 042 353925935 Fax: 042 35392592