| Attock Petroleum Limited - 2005 |
===================================================================================== BALANCE SHEET AS AT JUNE 30, 2005 ===================================================================================== 2005 2004 Notes Rupees Rupees ===================================================================================== SHARE CAPITAL AND RESERVES: Authorised capital 750,000,000 750,000,000 75,000,000 ordinary shares of Rs 10 each (2004: 75,000,000 ordinary shares of Rs 10 each) Issued, subscribed and paid up capital 3 400,000,000 300,000,000 Revenue reserve Unappropriated profit 613,130,878 372,681,909 1,013,130,878 672,681,909 NON CURRENT LIABILITIES: Long term deposits 4 84,099,000 59,650,000 Deferred income tax liability 5 14,000,000 14,050,000 98,099,000 73,700,000 CURRENT LIABILITIES: Trade and other payables 6 1,336,684,794 587,353,181 Contingencies and commitments 7 2,447,914,672 1,333,735,090 Property, plant and equipment 8 302,973,257 279,665,577 Capital work in progress 9 32,229,183 8,911,034 335,202,440 288,576,611 Long term investments 10 90,848,704 2,250,000 CURRENT ASSETS: Stores and spares 601,429 234,793 Stock in trade 11 10,076,276 21,456,954 Trade debts 12 277,118,491 233,105,279 Advances, deposits, prepayments and other receivables 13 291,401,912 82,044,769 Income tax refundable 75,591,219 75,762,661 Short term investments 14 - 34,980,000 Cash and bank balances 15 1,267,074,201 595,324,023 2,021,863,528 1,042,908,479 2,447,914,672 1,333,735,090 ===================================================================================== ===================================================================================== PROFIT AND LOSS ACCOUNTS FOR THE YEAR ENDED JUNE 30, 2005 ===================================================================================== 2005 2004 Notes Rupees Rupees ===================================================================================== Sales 16 11,196,458,434 8,556,958,784 Less: Sales tax 1,286,776,404 970,755,402 Net sales 9,909,682,030 7,586,203,382 Cost of products sold 17 9,478,638,868 7,093,923,043 Gross profit 431,043,162 492,280,339 Administrative and marketing expenses 18 131,139,762 94,416,403 Other operating expenses 19 33,704,941 31,501,726 164,844,703 125,918,129 266,198,459 366,362,210 Other operating income 20 293,673,841 167,201,691 Profit before taxation 559,872,000 533,563,901 Provision for taxation 21 99,423,331 197,800,000 Profit for the year 460,448,969 335,763,901 Basic earnings per share 22 11.51 8.39 ===================================================================================== =====================================================================================
CASH FLOW STATEMENT FOR THE YEAR ENDED JUNE 30, 2005
=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
CASH FLOWS FROM OPERATING ACTIVITIES:
Profit before taxation 559,872,300 533,563,901
Adjustment for Depreciation 32,117,769 22,962,382
Gain on sale of items of property, plant and equipment (824,234) -
Income on bank deposits and investments (29,459,963) (14,591,557)
561,705,872 541,934,726
MOVEMENT IN WORKING CAPITAL:
(Increase)/decrease in stores and spares (366,636) 120,936
(Increase)/decrease in stock in trade (88,619,322) 5,530,266
(Increase) in trade debts (44,013,212) (153,913,747)
(Increase) in advances, deposits, prepayments
and other receivables (208,154,447) (72,395,035)
Increase in trade and other payables 749,331,613 137,901,776
Taxes paid (99,301,889) (86,444,728)
Net cash provided by operating activities 870,581,979 372,734,194
CASH FLOWS FROM INVESTING ACTIVITIES:
Fixed capital expenditure (79,091,619) (55,171,974)
Proceeds from sale of property, plant and equipment 1,172,255 -
Long term investments (88,598,704) -
Short term investments 34,980,000 14,990,000
Income received on bank deposits and investments 28,257,267 14,643,295
Net cash used in investing activities (103,280,801) (25,538,679)
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid (120,000,000) (96,187,500)
Long term deposits received (24,449,000) 13,550,000
Net cash used in financing activities (95,551,000) (82,637,500)
Increase in cash and cash equivalents 671,750,178 264,558,015
Cash and cash equivalents at beginning of the year 595,324,023 330,766,008
Cash and cash equivalents at end of the year 1,267,074,201 595,324,023
=====================================================================================
===============================================================================================================
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED JUNE 30, 2005
===============================================================================================================
Share capital Reserve for Unappropriated
issue of profit
bonus shares Total
Rupees Rupees Rupees Rupees
===============================================================================================================
Balance as at June 30, 2003
- as previously reported 135,000,000 33,750,000 210,355,508 379,105,508
Change in accounting policy for dividend 54,000,000 54,000,000
Balance as at June 30, 2003 - restated 135,000,000 33,750,000 264,355,508 433,105,508
Final dividend @ 40% relating to 2002-2003 (54,000,000) (54,000,000)
Interim dividend @ 25% relating to 2003-2004 (42,187,500) (42,187,500)
Issue of bonus shares 165,000,000 (33,750,000) (131,250,000) -
Profit for the year 335,763,901 335,763,901
Balance as at June 30, 2004 300,000,000 - 372,681,909 672,681,909
Balance as at June 30, 2004
- as previously reported 300,000,000 - 252,681,909 552,681,909
Change in accounting policy for dividend 120,000,000 120,000,000 -
Balance as at June 30, 2004 - restated 300,000,000 - 372,681,909 672,681,909
Final dividend @ 40% relating to 2003-2004 (120,000,000) (120,000,000)
Issue of bonus shares 100,000,000 (100,000,000) -
Profit for the year 460,448,969 460,448,969
Balance as at June 30, 2005 400,000,000 - 613,130,878 1,013,130,878
===============================================================================================================NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 20051. LEGAL STATUS AND OPERATIONS Attock Petroleum Limited was incorporated in Pakistan as a public limited Company on December 3, 1995, commenced its operations in 1998 and listed on Karachi Stock Exchange on March 7, 2005. The company is engaged in marketing of petroleum products. Pharaon Commercial Investment Group Limited has a controlling interest in the company. 2. SIGNIFICANT ACCOUNTING POLICIES 2.l. BASICS OF PREPARATION These financial statements have been prepared under the historical cost convention and in accordance with approved accounting standards as applicable in Pakistan and the requirements of the Companies Ordinance, 1984. Approved accounting standards comprise of such International Accounting Standards as notified under the provisions of the Companies Ordinance, 1984. Wherever, the requirements of the Companies Ordinance, 1984 or directives issued by the Securities and Exchange Commission of Pakistan differ with the requirements of these standards, the requirements of Companies Ordinance, 1984 or the requirements of the said directives take precedence. 2.2. The Fourth Schedule to the Companies Ordinance 1984 has been amended during the year. This has resulted in the change in accounting policy pertaining to the recognition of dividends proposed after the balance sheet date but before the financial statements are authorised for issue. Previously such dividends were accounted for as a liability at the balance sheet date. From the current year, such dividend has not recognised as a liability at the balance sheet date. The change in accounting policy has been accounted for retrospectively and the comparative figures have been restated. The effect of change in accounting policy has been reflected in the statement of changes in equity. The change in accounting policy has not resulted in any change in the profit. 2.3. RETIREMENT BENEFITS The Company operates: (i) approved defined benefit funded pension plan for all eligible employees. The expense is recognised on the basis of actuarial valuation. Net actuarial gains and losses are recognised over the expected remaining service life of the employees. The latest actuarial valuation was carried out as at June 30, 2005. The details of the valuation are given in note 24. (ii) approved contributory provident fund for all employees for which contributions of Rs 933,556 (2004: Rs 750,986) were charged to income for the year. 2.4. TAXATION Provision for current taxation is based on taxable income at the current rate of tax. Deferred income tax is accounted for using the liability method in respect of all timing differences arising between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax is calculated at the rates that are expected to apply to the period when the differences reverse based on the tax rates that have been enacted. Deferred tax is charged to income currently. 2.5. PROVISIONS Provisions are recognised when the Company has a legal or constructive obligation as a result of past events, when it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made. 2.6. TRADE AND OTHER PAYABLES Liabilities for trade and other amounts payable are carried at cost which is the fair value of the consideration to be paid in future for goods and services received. 2.7. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are stated at cost less accumulated depreciation, except for freehold land and capital work in progress which are stated at cost. Depreciation is provided on the straight-line method to write off the cost of an asset over its estimated useful life at the rates specified in note 8. Full year's depreciation is charged on additions during the year, while no depreciation is charged on assets deleted during the year. 2.8. INVESTMENTS Investment in associated company is carried at cost less impairment losses. Investments with fixed payments and maturity, that the company has the intent and ability to hold to maturity are classified as held-to-maturity investments and are carried at cost less impairment losses. 2.9. STORES AND SPARES These are stated at moving average cost less any provision for obsolete and slow moving items. 2.10. STOCK IN TRADE Stock in trade is valued at the lower of cost, calculated on a first-in first-out basis, and net realisable value. Charges such as excise duty and similar levies incurred on unsold stock of products are added to the value of the stock and carried forward. Net realisable value signifies the sale price in the ordinary course of business less costs necessary to make the sale. 2.11. REVENUE RECOGNITION Sales are recorded on despatch of goods to customers. Commission and handling income is recognised on shipment of products. Income on investments and bank deposits is recognised on accrual basis. 2.12. FOREIGN CURRENCY TRANSACTIONS Transactions in foreign currencies are converted into rupees at the rates of exchange ruling on the date of the transaction. All assets and liabilities in foreign currencies are translated at exchange rates prevailing at the balance sheet date. Exchange gains and losses are taken to income currently. 2.13. FINANCIAL ASSETS AND LIABILITIES Financial assets and liabilities are recognised when the company becomes a party to the contractual provisions of the instrument and de-recognised when the company loses control of the contractual rights that comprise the financial assets and when the obligation specified in the contract is discharged, cancelled or expires. All financial assets and liabilities are initially measured at cost, which is the fair value of the consideration given and received respectively. These are subsequently measured at fair value, amortised cost or cost, as the case may be. 2.14. CASH AND CASH EQUIVALENTS For the purpose of cash flow statement, cash and cash equivalents consist of cash in hand, balances in banks and highly liquid short term investments. 3. ISSUED, SUBSCRIBED AND PAID UP CAPITAL =====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
SHARES ISSUED FOR CASH:
5,000,000 ordinary shares of Rs 10 each 50,000,000 50,000,000
(2004: 5,000,000 ordinary shares of Rs 10 each)
SHARES ISSUED AS FULLY PAID BONUS SHARES:
At beginning of the year 250,000,000 85,000,000
Shares issued during the year 100,000,000 165,000,000
35,000,000 (2004: 25,000,000) ordinary shares 350,000,000 250,000,000
40,000,000 (2004: 30,000,000) ordinary shares of Rs 10 400,000,000 300,000,000
=====================================================================================4. LONG TERM DEPOSITSThese represent interest free security deposits received from distributors, retailers and contractors and are refundable on cancellation of respective contracts or termination of related services. 5. DEFERRED INCOME TAX LIABILITY Deferred income tax liability represents temporary differences between accounting and tax depreciation. 6. TRADE AND OTHER PAYABLES =====================================================================================
2005 2004
Notes Rupees Rupees
=====================================================================================
Creditors 347,652,935 43,457,537
Due to related parties - unsecured 6.1 604,686,537 287,817,027
Accrued liabilities 100,124,938 77,867,024
Retention money 2,673,797 3,012,626
Advance from customers 252,079,624 147,369,935
Workers' profit participation fund 6.2 29,466,963 27,729,240
Staff Pension fund - 99,792
1,336,684,794 587,353,181
=====================================================================================6.1. THE AMOUNT DUE TO RELATED PARTIES COMPRISES OF=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Attock Refinery Limited 588,083,657 283,061,677
Pakistan Oilfields Limited 14,014,082 3,311,206
Attock Oil Company 2,320,301 1,444,144
Attock Cement Pakistan Limited 268,497 -
604,686,537 287,817,027
=====================================================================================6.2. WORKERS' PROFIT PARTICIPATION FUND=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Balance at beginning of the year 27,729,240 15,646,929
Allocation for the year 29,466,963 28,082,311
Amount paid to fund's trustees (27,729,240) (16,000,000)
Balance at end of the year 29,466,963 27,729,240
=====================================================================================7. CONTINGENCIES AND COMMITMENTS(i) Claims for Government levies not accepted by the Company Rs 47.391 million (2004: Rs 32.832 million). (ii) Capital expenditure commitments outstanding at June 30, 2005 amounted to Rs 57.543 million (2004: Rs 38.867 million). (iii) Commitment for long term investment in shares of National Refinery Limited Rs 235.516 million (2004: Rs Nil). 8. PROPERTY, PLANT AND EQUIPMENT ======================================================================================================================================
Cost Depreciation Written down Annual
At July 1, Additions/ At June 30, At July 1, Charge At June 30, value at rate of
2004 (deletions) 2005 2004 for the year/ 2005 June 30, depreciation
(on deletions) 2005
Rupees Rupees Rupees Rupees Rupees Rupees Rupees %
======================================================================================================================================
Freehold land 172,667,262 172,667,262 - - 172,667,262 -
Buildings on
Leasehold land 16,558,693 1,437,598 17,996,291 3,057,943 899,815 3,957,758 14,038,533 5
Pipelines, pumps,
tanks and meters 72,613,073 7,324,498 79,937,571 27,227,994 8,040,420 35,268,414 44,669,157 10
Equipment - signage 52,733,935 32,132,643 84,323,328 19,533,133 16,677,165 35,968,593 48,354,735 20
(543,250) (241,705)
Electrical and fire
fighting equipment 11,056,124 325,540 11,381,664 4,053,170 1,152,254 5,205,424 6,176,240 10
Furniture, fixture and
equipment 2,967,549 1,956,761 4,911,085 1,310,623 491,109 1,801,732 3,109,353 10
(13,225)
Computer and
auxiliary equipment 4,191,921 1,261,652 5,420,323 3,033,895 704,303 3,738,198 1,682,125 20
(33,250)
Motor vehicles 14,286,710 11,334,778 24,717,478 9,192,932 4,152,703 12,441,626 12,275,852 20
(904,010) (904,009)
Total 2005 347,075,267 55,773,470 401,355,002 67,409,690 32,117,769 98,381,745 302,973,257
(1,493,735) (1,145,714)
Total 2004 257,665,141 89,410,126 347,075,267 44,447,308 22,962,382 67,409,690 279,665,577
======================================================================================================================================8.1. Cost of assets held by a large number of dealers of retail outlets of the Company are as follows:============================================================================================
2005 2004
============================================================================================
Equipment - Signage Rupees Rupees
Pipelines, pumps, tanks and meters 82,951,488 52,273,515
16,942,220 11,660,755
============================================================================================Due to large number of dealers it is impracticable to disclose the name of each person having possession of these assets, as required under para 5 of Part 1 of the 4th Schedule to the Companies Ordinance 1984.8.2. Items of property, plant and equipment disposed off during the year include the following: ================================================================================================================
Original cost Book value Sale proceeds Mode of disposal Particulars of purchaser
Rupees Rupees Rupees
================================================================================================================
Equipment - signage 543,250 301,545 462,000 Insurance claim Efu General Insurance Co.
Furniture, fixture and
equipment 13,225 13,225 13,225 Insurance claim Efu General Insurance Co.
Computer and auxiliary
equipment 33,250 33,250 33,250 Insurance claim Efu General Insurance Co.
Motor vehicles 904,010 1 663,780 Tender Ch. Mohammad Saleem
================================================================================================================9. CAPITAL WORK IN PROGRESS=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Pumps, tanks and equipment 29,377,605 6,356,101
Advances to contractors 2,851,578 2,554,933
32,229,183 8,911,034
=====================================================================================10. LONG TERM INVESTMENTS - AT COST=====================================================================================
2005 2004
Notes Rupees Rupees
=====================================================================================
Investment in associated company 10.1 4,500,000 2,250,000
Advance against purchase of share
of a listed company 10.2 86,348,704 -
90,848,704 2,250,000
=====================================================================================10.1. This represents investment in 10% shares of Attock Information Technology Services (Private) Limited.A total investment of Rs 4.5 million was approved by the shareholders in 8th General Meeting of the Company held on June 16, 2001 of which Rs 2.25 million was subscribed for against right issue of shares in October 2004. 10.2. This represents advance against purchase of 666,388 shares of National Refinery Limited (NRL) from the Government at Rs 483 per share, as part of consortium of Attock Oil Group of Companies to purchase 51% shares of NRL. The company's share of total purchase price was Rs 321.865 million, out of which Rs 86.349 million was paid before the balance sheet date and the balance amount of Rs 235.516 million has been paid subsequent to the year end. The ownership of shares has been transferred to the Company subsequent to the year's end. 11. STOCK IN TRADE =====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Petroleum products 107,792,134 20,339,575
Packing material 2,284,142 1,117,379
110,076,276 21,456,954
=====================================================================================12. TRADE DEBTS, CONSIDERED GOOD=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Secured 157,487,311 207,769,786
Unsecured 87,198,981 19,884,871
DUE FROM RELATED PARTIES:
Attock Refinery Limited 421,172 -
Pakistan Oilfields Limited 26,638,011 3,071,120
Attock Cement Pakistan Limited 5,373,016 2,379,502
277,118,491 233,105,279
=====================================================================================13. ADVANCES, DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
LOANS AND ADVANCES - CONSIDERED GOOD:
Advances to suppliers 17,595,835 10,305,646
Advances to employees against expenses 67,851 92,950
17,663,686 10,398,596
DEPOSITS, PREPAYMENTS AND CURRENT ACCOUNT BALANCES
WITH STATUTORY AUTHORITIES:
Security deposits 419,952 364,952
Prepayments 1,977,871 2,347,551
Sales tax refundable 157,380,093 45,795,174
159,777,916 48,507,677
ACCRUED INCOME:
Income on bank deposits and short term investment 1,742,243 542,547
Indenting commission on exports - 7,124,329
1,745,243 7,666,876
Price Differential Claim receivable from the Government 100,693,508 -
Claims receivable 10,401,467 14,032,502
DUE FROM RELATED PARTIES - UNSECURED:
Attock Information Technology Services (Private) Limited 475,917 550,637
Staff provident fund 325,244 360,120
Staff pension fund 126,000 -
Freight pool - 475,361
Others 192,931 53,000
291,401,912 82,044,769
=====================================================================================14. SHORT TERM INVESTMENTS=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
HELD TO MATURITY INVESTMENTS:
Investment in Term Finance Certificates - 24,980,000
Investment in Carry Over Transactions - 10,000,000
- 34,980,000
=====================================================================================15. CASH AND BANK BALANCES=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Cash in hand 226,760 164,776
Balance with bank
On savings account 1,266,842,955 595,154,761
(includes US $ 108,011; 2004: US $ 7,483) 4,486 4,486
On current account
1,267,074,201 595,324,023
=====================================================================================15.1. Deposits of Rs 33.658 million (2004: Rs 33.267 million) were held with banks under line to secure bank guarantees against advance received from customers.15.2. Bank balances on savings account carried interest ranging between 2.15% to 6.50% per annum (2004: 0.5% to 4% per annum). 16. SALES =====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Gross Sales 11,217,026,156 8,563,204,650
Less: Rebates/Discount (20,567,722) (6,245,866)
11,196,458,434 8,556,958,784
=====================================================================================17. COST OF PRODUCTS SOLD=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Opening stock 21,456,954 26,987,220
Add: Purchase of petroleum products
and packing material 9,249,379,148 6,429,244,479
Excise duty 242,472,038 224,377,272
Development surcharge 75,407,004 434,771,026
9,567,268,190 7,088,392,777
Closing stock (110,076,276) (21,456,954)
9,478,638,868 7,093,923,043
=====================================================================================18. ADMINISTRATIVE AND MARKETING EXPENSES=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Salaries and benefits 48,889,192 43,506,974
Rent, taxes and other fees 7,636,545 2,518,820
Repairs and maintenance 4,597,174 2,741,218
Communication 2,657,102 1,968,862
Insurance 1,484,656 1,118,243
Travelling and staff transport 8,189,868 5,400,775
Transportation expenses 1,187,816 1,708,758
Printing and stationery 2,462,204 1,026,189
Consultancy charges 1,164,903 2,879,356
Legal and professional charges 2,502,048 1,193,356
Electricity, gas and water 2,773,832 2,764,864
Advertising and publicity 9,658,540 1,433,724
Depreciation 32,117,769 22,962,382
Subscription and fees 1,305,990 1,514,104
Other expenses 4,069,582 1,211,843
Auditor's remuneration and expenses
Statutory audit 225,000 180,000
Half yearly audit, special
certifications and audit of staff fund 188,600 269,035
Out-of-pocket expenses 28,941 17,900
442,541 466,935
131,139,762 94,416,403
=====================================================================================19. OTHER OPERATING EXPENSES=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Workers' profit participation fund 29,466,963 28,082,311
Bank charges 3,554,434 3,415,730
Exchange loss 683,544 3,685
33,704,941 31,501,726
=====================================================================================20. OTHER OPERATING INCOME=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Commission and handling income 260,022,429 151,702,268
Income on bank deposits 22,263,239 8,238,523
Income on Term Finance Certificates 1,445,760 6,353,034
Income from Carry Over Transactions 5,750,964 862,981
Tender and joining fee 1,549,000 -
Gain on sale of items of property, plant and equipment 824,234 -
Others 1,818,215 44,885
293,673,841 167,201,691
=====================================================================================21. PROVISION FOR TAXATION=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Current - for the year 167,000,000 192,200,000
- for prior years (67,526,669) 550,000
Deferred - for the year (50,000) 5,050,000
99,423,331 197,800,000
=====================================================================================21.1. RECONCILIATION OF TAX CHARGE FOR THE YEAR=====================================================================================
% %
=====================================================================================
Applicable tax rate 35.00 41.00
Add: Tax effect of export sales which are
taxable @ 1% of sales (5.09) (3.84)
Tax effect of amounts that are not
deductible for tax purposes 0.13 0.04
Tax effect of prior year tax (12.06) 0.10
Tax effect of deferred tax due to reduced tax rate (0.22) (0.23)
Average effective tax rate charged to income 17.76 37.07
=====================================================================================22. BASIC EARNINGS PER SHARE=====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Profit after tax (Rupees) 460,448,969 335,763,901
Number of Ordinary Shares outstanding 40,000,000 40,000,000
Basic earnings per share (Rupees) 11.51 8.39*
===================================================================================== * Basic earnings per share for 2004 of Rs 11.19 has been restated for 10 million bonus shares issued during the year ended June 30, 2005.22.1. The Board of Directors in its meeting held on September 11, 2005 proposed a final dividend of Rs 5 per share for the year ended June 30, 2005, amounting to Rs 200 million for approval of the members at the Annual General Meeting to be held on October 17, 2005. These financial statements do not include the effect of this proposed dividend. 23. FINANCIAL INSTRUMENTS 23.1. FINANCIAL ASSETS AND LIABILITIES ===============================================================================================================================
2005 2004
Interest/ Non-interest/ Interest/ Non-interest/
mark-up mark-up mark-up mark-up
bearing bearing Total bearing bearing Total
Notes Rupees Rupees Rupees Rupees Rupees Rupees
===============================================================================================================================
FINANCIAL ASSETS
Maturity up to one year
Trade debts - 277,118,491 277,118,491 - 233,105,279 233,105,279
Advances, deposits and
other receivables - 271,760,355 271,760,355 - 69,298,622 69,298,622
Short term investments 14 - - - 34,980,000 - 34,980,000
Cash and bank balances 15
Foreign currency - US $ 6,438,560 - 6,438,560 430,786 - 460,786
Local currency 1,260,404,395 231,246 1,260,635,641 594,723,975 169,262 594,893,237
Maturity after one year
Long term investments - 90,848,704 90,848,704 - 2,250,000 2,250,000
1,266,842,955 639,958,796 1,906,801,751 630,134,761 304,823,163 934,957,924
FINANCIAL LIABILITIES
Maturity up to one year
Trade and other payables - 1,084,605,170 1,084,605,170 - 439,983,246 439,983,246
Maturity after one year
Long term deposits - 84,099,000 84,099,000 - 59,650,000 59,650,000
OFF BALANCE SHEET ITEMS:
Commitments 7 - 293,059,890 293,059,890 - 38,867,046 38,867,046
===============================================================================================================================23.2. CREDIT RISKCredit risk represents the accounting loss that would be recognised at the reporting date if counter parties failed completely to perform as contracted. The Company's credit risk is primarily attributable to its trade debts, investments and balances at banks. Credit sales are against letters of credit/bank draftsgreements and to other Oil Marketing Companies or reputable organizations. The management does not expect these oganizations to fail to meet their obligations, therefore credit risk against trade debts is minimal. The credit risk on bank balances and investments is limited because the counter parties are banks/companies with reasonably high credit ratings. 23.3. FOREIGN EXCHANGE RISK Financial assets of Rs 27.30 million (2004: Rs 7.55 million) and financial liabilities of Rs 60.78 million (2004: Rs 43.07 million) were in foreign currency and subject to foreign exchange risk. 23.4. FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES The carrying value of financial assets and liabilities approximate their fair value except for short term investments and long term investments which are stated at cost. 24. RETIREMENT BENEFITS The details of actuarial valuation of defined benefit funded pension plan are as follows: =====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
RECONCILIATION OF PAYABLE TO / (RECOVERABLE FROM)
DEFINED BENEFIT PLAN:
Present value of defined benefit obligation 5.714
Fair value of plan assets (6.110)
Net actuarial gains not recognised 0.270
(0.126)
MOVEMENT IN NET LIABILITY/(ASSET):
Opening net liability 0.099
Expense 1.378
Benefits paid (1.603)
Closing net (asset) (0.126)
CHARGE / (INCOME) FOR THE DEFINED BENEFIT PLAN:
Current service cost 1.372
Interest cost 0.265
Expected return on plan assets (0.259)
1.378
=====================================================================================The Projected Unit Credit Method using the following significant assumptions was used for the valuation of the plan:Valuation discount rate: 10% p.a. Salary increase rate: 10% p.a. Expected return on plan assets: 6.10% p.a. Pension indexation: 0% p.a. 25. TRANSACTIONS WITH RELATED PARTIES Aggregate transactions with related parties, other than remuneration to the chief executive, directors and executives of the Company under their terms of employment, were as follows: =====================================================================================
2005 2004
Rupees Rupees
=====================================================================================
Purchase of petroleum products 8,229,595,491 5,828,323,283
Sale of petroleum products 245,039,291 101,181,493
Commission and handling income 246,030,356 123,916,179
Administrative services expense 22,805,264 18,326,634
Investment in associated company 2,250,000 -
=====================================================================================Transactions with related parties are at arm's length prices determined in accordance with the prescribed methods.The prices for purchase and sale of regulated products are based on prices notified by the Government. The prices for other products and commission and handling income are based on the principles of normal commercial practices between independent businesses. Administrative services expense is based on allocated cost. 26. REMUNERATION OF CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES ============================================================================================================
Chief Executive Directors * Executives
2005 2004 2005 2004 2005 2004
Rupees Rupees Rupees Rupees Rupees Rupees
============================================================================================================
Managerial remuneration 4,568,973 4,568,973 2,261,060 2,770,202 1,449,306 -
Bonus 2,704,921 2,704,921 886,720 701,500 158,000 -
Company's contribution to
provident and pension funds 685,584 685,584 371,263 484,200 343,866 -
Housing and utilities 1,485,432 1,485,432 486,189 538,800 749,677 -
Leave passage 380,880 380,880 421,693 241,753 149,604 -
9,825,790 9,825,790 4,426,925 4,736,455 2,850,453 -
No of persons, including those
who worked part of the year 1 1 2 2 2 -
============================================================================================================26.1. The above includes amount charged by an associated company for share of chief executive's and 1 director's remuneration as approved by Board of Directors of the company.One of the directors, who worked as executive director upto February 2005, was provided with use of company maintained car, medical facilities and unfurnished accommodation as per company policy. Executives were also provided with use of company maintained cars and medical facilities as per company policy. 26.2. The definition of executive under the Companies Ordinance, 1984 was revised during the year with respect to the minimum basic salary requirement from Rs 100,000 to Rs 500,000 in a financial year. The 2004 figures have been restated for the purpose of comparison. 27. NUMBER OF EMPLOYEES Total number of employees at the end of the year were 84 (2004: 63). 28. CORRESPONDING FIGURES Previous year's figures have been rearranged, wherever necessary, for the purpose of comparison. Major changes of presentation are as follows: =============================================================================================
Reclassification from Reclassification to Nature Rupees
=============================================================================================
Net sales Cost of products sold Excise duty and development 659,148,298
surcharge
Other operating income Cost of products sold Product shortages claims 3,777,113
realised
Other operating expenses Administrative and Employee retirement benefits 2,093,848
marketing expenses
=============================================================================================29. DATE OF AUTHORIZATION FOR ISSUEThese financial statements were authorised for issue by the Board of Directors of the company on September 11, 2005. |