National Foods Ltd - 2001
===================================================================================
BALANCE SHEET AS AT 30 JUNE, 2001
-----------------------------------------------------------------------------------
                                                              2001             2000
                                                Note        Rupees           Rupees
===================================================================================
CAPITAL AND RESERVES
Capital
Authorized Capital 5,000,000
(2000: 5,000,000) ordinary
Shares of Rs. 10 each                                   50,000,000       50,000,000
Issued, subscribed & paid-up capital             3      42,505,380       42,505,380
Reserves
Capital- share premium                                   6,102,100        6,102,100
Unappropriated profit                                   56,495,027       42,018,793
                                                        62,597,127       48,120,893
                                                       105,102,507       90,626,273
LONG TERM LIABILITIES
Liabilities against assets
 subject to finance lease - secured              4       7,365,475        8,808,729
Deferred tax                                             6,445,060        5,399,798
                                                        13,810,535       14,208,527
CURRENT LIABILITIES
Current portion of liabilities against
 assets subject to finance lease                 4       7,243,520        4,762,199
Finances utilized under mark-up
 arrangements - secured                          5      92,988,783      110,934,296
Creditors, accrued expenses & other liabilities  6      88,256,153       79,129,962
Proposed dividend                                       12,751,614        4,888,119
                                                       201,240,070      199,714,576
Contingencies & commitments                      7               -                -
                                                       320,153,112      304,549,376
-----------------------------------------------------------------------------------
PROPERTY AND ASSETS
Fixed Capital Expenditure
Fixed assets                                     8     106,434,420       84,479,673
Capital work-in progress                         9       2,775,867          457,969
                                                       109,210,287       84,937,642
Long term deposits                                       1,592,180        1,410,981
Deferred expenditure                            10               -        2,100,000
CURRENT ASSETS
Stock-in-trade                                  11     151,802,580      177,412,663
Trade debts - unsecured -
 considered good                                        32,882,300       23,847,224
Advances, deposits, prepayments
 and other receivables                          12      20,058,373       14,033,628
Cash and bank balances                          13       4,607,392          807,238
                                                       209,350,645      216,100,753
                                                       320,153,112      304,549,376
===================================================================================
===================================================================================
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 30 JUNE, 2001
-----------------------------------------------------------------------------------
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Sales                                           14     915,136,401      765,675,135
Less: Cost of sales                             15     675,226,208      578,471,953
Gross profit                                           239,910,193      187,203,182
Operating Expenses
Less: Administrative expenses                   16      22,912,327       20,458,873
Selling and distribution expenses               17     167,062,331      127,879,179
                                                       189,974,658      148,338,052
Operating profit                                        49,935,535       38,865,130
Add: Other income                               18       2,156,953          993,604
                                                        52,092,488       39,858,734
Less: Financial and other charges               19     (16,405,820)    (14,280,790)
Profit before taxation                                  35,686,668       25,577,944
Less: Taxation                                  20      (8,458,820)     (7,074,787)
Profit after taxation                                   27,227,848       18,503,157
Add: Unappropriated profit brought
 forward                                                42,018,793       32,654,293
Profit available for appropriation                      69,246,641       51,157,450
APPROPRIATIONS:
Interim dividend Nil (2000: 10%)                                 -        4,250,538
Proposed final dividend @ 30% (2000:11.5%)              12,751,614        4,888,119
                                                        12,751,614        9,138,657
Unappropriated profit carried forward                   56,495,027       42,018,793
Basic earnings per share                        21            6.41             4.35
===================================================================================
===================================================================================
CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE, 2001
-----------------------------------------------------------------------------------
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
CASH FLOW FROM OPERATING ACTIVITIES:
Profit before taxation                                  35,686,668       25,577,944
Adjustments for non cash charges and other items
Depreciation                                            13,748,139       11,962,515
Amortization of Deferred expenses                        2,100,000       -
Profit on sale of fixed assets                            (819,147)       (402,838)
Financial and other charges                             16,405,820       12,613,790
                                                        31,434,812       24,173,467
Operating profit before working capital changes         67,121,480       49,751,411
(Increase)/decrease in current assets
Stock in trade                                          25,610,083     (37,544,233)
Trade debts                                             (9,035,076)     (4,306,780)
Advances, deposits, prepayments and other receivables   (4,604,203)       1,658,467
                                                        11,970,804     (40,192,546)
Increase in current liabilities
Creditors, accrued and other liabilities                 9,504,787       15,757,171
                                                        88,597,071       25,316,036
Financial charges paid                                 (16,657,867)    (13,450,431)
Taxes paid                                              (8,834,100)     (5,436,435)
                                                       (25,491,967)    (18,886,866)
Net cash from operating activities                      63,105,104        6,429,170
CASH FLOW FROM INVESTING ACTIVITIES:
Capital expenditure                                    (33,632,260)     (8,053,080)
Sale proceeds of fixed assets                            4,151,539        1,641,270
Long term deposits                                        (181,199)       (145,000)
Deferred expenditure                                             -      (2,100,000)
Finance leased assets                                   (7,720,916)    (11,786,500)
Net cash used in Investing activities                  (37,382,836)    (20,443,310)
                                                        25,722,268     (14,014,140)
CASH FLOW FROM FINANCING ACTIVITIES:
Repayment of long term loan                             (6,682,849)     (3,006,824)
Dividend paid                                           (5,014,668)     (9,624,834)
Proceed from finance lease                               7,720,916       11,786,500
Net cash used in financing activities                   (3,976,601)       (845,158)
Net decrease in cash & Cash equivalent                  21,745,667     (14,859,298)
Cash & Cash equivalent at the beginning of the year   (110,127,058)    (95,267,760)
Cash & Cash equivalent at the end of the year          (88,381,391)   (110,127,058)
CASH & CASH EQUIVALENTS:
Cash & bank balance                                      4,607,392          807,238
Finance utilized under mark-up arrangements            (92,988,783)   (110,934,296)
                                                       (88,381,391)   (110,127,058)
===================================================================================
NOTES TO THE ACCOUNTS FOR THE YEAR ENDED 30 JUNE, 2001
3. ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
1,255,990 (2000: 1,255,990) Ordinary Shares
 of Rs. 10 each fully paid in cash                      12,559,900       12,559,900
2,994,548 (2000: 2,994,548) Ordinary Shares
 of Rs. 10 each issued as fully
 paid bonus shares                                      29,945,480       29,945,480
                                                        42,505,380       42,505,380
===================================================================================
4. LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE

The amount of future lease payments and the period in which these payments will become due are.
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Year ending June 30
2001                                                             -        6,762,534
2002                                                     9,234,880        6,134,000
2003                                                     7,241,918        4,141,038
2004                                                       880,087                -
                                                        17,356,885       17,037,572
Less: Financial charges allocated to future periods      2,747,890        3,466,644
                                                        14,608,995       13,570,928
Less: Current portion shown under current obligation     7,243,520        4,762,199
                                                         7,365,475        8,808,729
===================================================================================
The implicit rate used as the discounting factor is in range between 14.77% -19.08% per annum. Rentals are payable in equal monthly/quarterly installments.

At the end of lease period the ownership of assets will be transferred to the company on payment of residual value.

These are secured by demand promissory notes and security deposits.
5. FINANCE UTILIZED UNDER MARK-UP ARRANGEMENTS � SECURED
===================================================================================
                                                              2001             2000
                                             NOTE           Rupees           Rupees
===================================================================================
Bank Al-Habib Limited
Export refinance                              5.1       54,721,000       47,603,000
Running finance                               5.2       38,267,783       60,331,296
Advance against trust receipt                 5.3                -        3,000,000
                                                        92,988,783      110,934,296
                                                        92,988,783      110,934,296
===================================================================================
5.1.
===========================================================================================
LIMIT                       EXPIRY        RATE OF                                  SECURITY
Rupees                                    MARK-UP
-------------------------------------------------------------------------------------------
Rs. 54,721,000              31 Oct   8% to 9% per       The facility mentioned in note 5.1,
 (2000: Rs. 47,603,000)       2001          annum               5.2 and 5.3 are secured by:
                                                           i) Registered hypothecation over
                                                           stock & debtors to the extent of
===========================================================================================
5.2.
===========================================================================================
LIMIT                       EXPIRY        RATE OF                                  SECURITY
Rupees                                    MARK-UP
-------------------------------------------------------------------------------------------
Rs. 70,000,000              31 Oct       14% to 15%                   Rs. 185 million each.
 (2000: Rs. 71,770,000)       2001       per annum
                                                          ii) Registered equitable mortgage
                                                               over immovable to the extent
===========================================================================================
5.3.
===========================================================================================
LIMIT                       EXPIRY        RATE OF                                  SECURITY
Rupees                                    MARK-UP
-------------------------------------------------------------------------------------------
Rs. 3,000, 000              31 Oct       17.5% per                      of Rs. 117 million.
 (2000: Rs. 3,000,000)        2001           annum    iii) Personal guarantees of directors
                                                               amounting to Rs. 210 million
===========================================================================================
6. CREDITORS, ACCRUED AND OTHER LIABILITIES
===================================================================================
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Creditors                                               32,502,029       30,174,301
Accrued expenses                                        10,676,403        8,242,514
Advance from customers                                   6,696,644        9,913,146
Security deposits                                          106,200          159,700
Mark-up accrued on secured loans                         2,065,359        2,317,406
Unclaimed dividend                                         677,183          803,732
Due to associated undertakings                             267,245           37,440
Due to directors                                             7,463           52,365
Due to employees gratuity fund trust                     9,197,372        6,247,357
Payable to employees provident fund trust                3,394,394          984,784
Sales tax payable                                        6,051,658        3,912,652
Workers welfare fund                                       347,878        1,051,568
Workers profit participation fund              6.1       2,139,538        1,268,000
Other liabilities                                       14,126,787       13,964,997
                                                        88,256,153       79,129,962
===================================================================================
6.1. WORKERS PROFIT PARTICIPATION FUND
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Opening balance                                          1,268,000          826,628
Allocation for the year                                  1,908,704        1,208,000
                                                         3,176,704        2,034,628
Interest on funds utilized in
 company�s business                                        230,834           60,000
Payment to beneficiaries                                (1,268,000)       (826,628)
                                                         2,139,538        1,268,000
===================================================================================
7. CONTINGENCIES AND COMMITMENTS

7.1. Company has commitments against outstanding letters of credit established for import of goods amounting to Rs. 6,761,300 as on 30-06-2001 (2000: Rs. 6,840,000).

7.2. Company�s commitment with bank for payment against documents was Rs. 6,541,200 as on 30-06-2001 (2000: Rs. Nil).
8. FIXED ASSETS
====================================================================================================================================================
                                                 COST                                              DEPRECIATION
                                   As on    Additions/         As on    Rate       As on     Additions/         Charge        As on          Written
Particulars                      1, July   (Disposals)/      30 June              1 July    (Disposals)/       for the      30 June       Down value
                                    2000    Transfers           2001                2000     Transfers            year         2001            as on
                                           During the                                       During the                                  30 June 2001
                                                 Year/                                            Year
Owned assets                      Rupees       Rupees         Rupees       %       Rupees       Rupees          Rupees       Rupees           Rupees
====================================================================================================================================================
Leasehold Land                 1,450,235   11,339,000     12,789,235       -            -            -               -            -       12,789,235
Buildings on leasehold Land   33,604,652      158,626     33,763,278      10   15,813,280            -       1,795,000   17,608,280       16,154,998
Plant, Machinery,
Equipments & Generators       45,704,400    8,059,136     53,763,536      10   21,622,686            -       3,214,101   24,836,787       28,926,749
Office & Other Equipments     20,001,419    2,096,943     22,098,362      15   10,578,539            -       1,727,978   12,306,517        9,791,845
Laboratory Equipments          1,419,188      976,718      2,395,906      10      574,482            -         182,144      756,626        1,639,280
Motor Vehicles                21,600,517    6,589,191     26,608,528      20   10,751,476            -       3,412,601   12,958,153       13,650,375
                                           (3,319,180)                                      (2,054,068)
                                            1,738,000*                            848,144*
Furniture & Fixtures           9,023,080      356,748      9,379,828      10    3,441,441            -         593,849    4,035,260        5,344,568
                             132,803,491   29,576,362    160,798,673           62,781,874            -      10,925,673   72,501,623       88,297,050
                                           (3,319,180)                                      (2,054,068)
                                            1,738,000*                                         848,144*
Leased assets
Machinery                     11,570,000    3,660,000     15,230,000      10    1,535,000            -       1,369,500    2,904,500       12,325,500
Motor vehicles                 6,154,500    4,060,916      8,148,136      20    1,731,444     (848,144)*     1,452,966    2,336,266        5,811,870
                                             (329,280)
                                           (1,738,000)*
                              17,724,500    7,720,916     23,378,136            3,266,444     (848,144)�     2,822,466    5,240,766       18,137,370
                                             (329,280)
                                           (1,738,000)
TOTAL 2001:                  150,527,991   39,035,278    184,176,809           66,048,318   (2,054,068)     13,748,139   77,742,389      106,434,420
                                           (5,386,460)
TOTAL 2000           :       134,684,916   19,668,594    150,527,991           56,672,890   (2,587,087)     11,962,515   66,048,318       84,479,673
                                           (3,825,519)
====================================================================================================================================================
* Represents adjustment of assets transferred from leased assets to owned assets.

8.1. DEPRECIATION HAS BEEN ALLOCATED AS FOLLOWS
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Cost of Sales                                            9,249,133        7,343,464
Administrative expenses                                  1,778,075        2,273,363
Selling and distribution expenses                        2,720,931        2,345,688
                                                        13,748,139       11,962,515
===================================================================================
8.2. DISPOSAL OF FIXED ASSETS
===================================================================================================================================
Particulars                                        Cost      Accumulated         Book          Sold        Profit/          Mode of
                                                            Depreciation        Value           for         (Loss)         Disposal
                                                     Rs.              Rs.          Rs.           Rs.          Rs.
-----------------------------------------------------------------------------------------------------------------------------------
MOTOR VEHICLES
Suzuki Khyber 1000cc                            310,980          229,458       81,522       172,786       91,264        Negotiation
Reg. No. Z-1182
Mr. Nisar Ahmed Naseem Ali Khan
House No, II D 10/2, Nazimabad
Karachi.
Suzuki Khyber 993cc                             320,500          236,482       84,018       200,000      115,982        Negotiation
Reg. No. Z-9390
Mrs. Farhana Nisar Ahmed
House No. II D 10/2, Nazimabad
Karachi.
Mazda Pickup                                    285,000          246,748       38,252       230,000      191,748        Negotiation
Reg. Na. KE-8123
Mr. Mohammad Ayub Karam Elahi
House No. R-85-5, Gali Na, B 11/7
Bahawalpur Road, Lahore.
Yamaha YB-100                                    57,400           33,889       23,511        27,000        3,489        Negotiation
Reg. No, LXA-2191
Mr. Alfred Sadiq
House No. 1725/3497
Tippu Sultan Road
Madina Colony, Karachi
Suzuki Margalla                                 487,000          287,525      199,475       300,000      100,525        Negotiation
Reg. No. AAS-429
Mr. Mohammad all Rehmat Ali
Madina Hotel, Karimabad, Karachi.
Suzuki Swift 1000cc                             350,000          235,312      114,688       200,000       85,312        Negotiation
Reg. No, AB-429
Mr. Siraj Ahmed
House No. II D 10/2 Nazimabad
Karachi.
Suzuki Bolan 800cc                              320,000          215,142      104,858       185,200       80,342        Negotiation
Reg. No. CJ-9561
Mr. Nizar Mohammad Ali
Flat No. 40 Amina Corner,
Block-01. F.B. Area, Karachi.
KIA Pride 1100cc                                372,100          219,688      152,412       161,300        8,888        Negotiation
Reg. No. AAJ-590
Mr. Babar Ahmed Khan
House No. R-642, Sir Syed Town
Adam Town, Karachi.
Yamaha YB-100                                    49,000           36,155       12,845        30,922       18,077            Company
Reg. No. KCK-9451                                                                                                            Policy
Mr. Maratab All Rehmat Ali
Sajjad Gohar Manzil Noor Allahnoor
Masjid Gulistan Colony Tenery Road
Karachi.
Sub Total                                     2,551,980         1,740399      811,581     1,507,208      695,627
MOTOR VEHICLES
Honda Motorcycle CD-70                           51,000           37,630       13,370        32,185       18,815            Company
Reg. No. KCV-788                                                                                                             Policy
Mr. Majid Hussain
House No. 15/4, 1-E Nazimabad
Karachi.
Honda Motorcycle CD-70                           50,000           33,616       16,384        24,120        7,736            Company
Reg. NO. KCV-3125                                                                                                            Policy
Mr. Aurangzeb Ghori
House No. R-102, Sector 5B-1
North Karachi.
Honda Motorcycle CD-70                           50,000           33,616       16,384        24,120        7,736            Company
Reg. No. GAJ-5981                                                                                                            Policy
Mr. Sheraz Fakhar
House No. 29. Block Z, Street No. 6
Peoples Colony. Gujranwala.
Honda Motorcycle CD-70                           54,700           36,776       17,924        26,170        8,246            Company
Reg. No PRQ-6230                                                                                                             Policy
Mr. Asif-Ullah-Paracha
House No, 5 Armour Colony Macci
Shareef Road. Peshawar.
Honda Motorcycle CD-70                           54,500           36,642       17,858        26,135        8,277            Company
Reg. No, KCV-4122                                                                                                            Policy
Mr. Hamid Ali Mirza
House No. C-53, Block-D
North Nazimabad, Karachi.
Honda Motorcycle CD-70                           54,500           36,642       17,858        26,135        8,277            Company
Reg. NO. KCV-4123                                                                                                            Policy
Mr. Sher Ali Mohammad Jamil
House No. 158/1 5/E, New Karachi.
Honda Motorcycle CD-70                           55,000           36,978       18,022        26,466        8,444            Company
Reg. No. KCV-4496                                                                                                            Policy
Mr. Mohammad Naseem Akhter
House No. C-10, Apsara Apartment No. 5
F.C, Area, Karachi.
Honda Motorcycle CD-70                           59,500           35,129       24,371        50,000       25,629          Insurance
Reg. No. HDM-1693                                                                                                             Claim
E.F.U. General Insurance Limited
Yamaha Motorcycle YB-100                         66,600           13,320       53,280        67,000       13,720          Insurance
Reg. No. KCT-0618                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Yamaha Motorcycle YB-100                         66,600           13,320       53,280        68,000       14,720          Insurance
Peg. No. KCT-0736                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Sub Total                                       562,400          313,669      248,731       370,331      121,600
MOTOR VEHICLES
Yamaha Motorcycle YB-100                         67,500                -       67,500        68,000          500          Insurance
Reg. No, KCT-4384                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Honda Motorcycle CD-70                           69,000                -       69,000        69,000            -          Insurance
Reg. No. KCT-4946                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Honda Motorcycle CD-70                           68,300                -       68,300        69,000          700          Insurance
Reg. No. KCT-6834                                                                                                             Claim
Sub Total                                       204,800                -      204,800       206,000        1,200
                                              3,319,180        2,054,068    1,265,112     2,083,539      818,427
LEASED ASSETS
Motor Vehicles
Yamaha YB-100                                    65,856                -       65,856        66,000          144          Insurance
Reg. No. KCT-2706                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Yamaha YB-100                                    65,856          -             65,856        66,000          144          Insurance
Reg. No. KCT-2703                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Yamaha YB-100                                    65,856          -             65,856        66,000          144          Insurance
Reg. No. KCT-2704                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Yamaha YB-100                                    65,856          -             65,856        66,000          144          Insurance
Reg. No. KCT-2705                                                                                                             Claim
E.F.U. General Insurance Limited
Karachi.
Yamaha YB-100                                    65,856          -             65,856        66,000          144          Insurance
Reg. No. KCT-2708                                                                                                             Claim
E,F.U, General Insurance Limited
Karachi.
Sub Total                                       329,280          -            329,280       330,000          720
Total                                         3,648,460  2,054,068          1,594,392     2,413,539      819,147
===================================================================================================================================
9. CAPITAL WORK-IN-PROGRESS
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Building                                                 2,710,194          457,969
Plant and machinery                                         65,673                -
                                                         2,775,867          457,969
===================================================================================
10. DEFERRED EXPENDITURE
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Advertisement                                                    -        2,100,000
===================================================================================
11. STOCK-IN-TRADE
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Raw material                                            44,389,818       49,757,528
Work-in-process                                         52,364,848       56,686,745
Finished goods                                          22,102,549       33,688,638
Packing material                                        29,602,500       31,205,468
Goods in transit                                         2,155,280        5,027,606
General material                                         1,187,585        1,046,678
                                                       151,802,580      177,412,663
===================================================================================
12. ADVANCES, DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES
===================================================================================
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Advances
Staff - considered good                                  1,388,580        1,485,361
Income tax                                               5,926,305        4,505,763
Profit accrued on DSC Gratuity fund                      9,587,091        6,070,993
Other - considered good                                    739,110          343,988
                                                        17,641,086       12,406,105
Prepayments                                                362,335          150,185
Deposits                                                   114,400          114,400
Export rebate receivable                                   867,601          494,842
Due from associated undertakings              12.1          72,951          868,096
Sales tax refundable                          12.2       1,000,000                -
                                                        20,058,373       14,033,628
===================================================================================
12.1. Maximum aggregate balance due from associated undertakings at the end of any month during the year was Rs. 951,601(2000: 1,126,019).

12.2. This represents sales tax paid under protest against arbitrary levy on table salt and other spices amounting to Rs. 87.8 million (later reduced to 30.7 million). As a result of appeal the matter has been set aside by the Tribunal by accepting the appeal.

However, the department has preferred an appeal against the order of the Tribunal and for the stay of refund claimed by the company before the High Court.
13. CASH AND BANK BALANCES
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
In hand                                                    306,473          233,844
With banks in current accounts                           4,300,919          573,394
                                                         4,607,392          807,238
===================================================================================
13.1. Balance on current accounts include a separate account for deposits from dealers amounting to Rs. 112,034 (2000: Rs. 165,604).
14. SALES
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Local sales
Gross sales                                          1,059,358,411      907,304,014
Less: Discount                                         126,307,910      116,839,000
Cartage/freight                                         19,361,938       15,319,960
Sales tax                                              117,624,668       99,226,296
Sales returns                                           18,107,237       19,388,655
                                                       281,401,753      250,773,911
                                                       777,956,658      656,530,103
Export sales
Gross sales                                            151,955,108      119,717,657
Less: Freight                                           10,049,759        7,765,350
Forwarding charges                                       3,251,947        2,382,854
Discount/commission                                      1,473,659          424,421
                                                        14,775,365       10,572,625
                                                       137,179,743      109,145,032
                                                       915,136,401      765,675,135
===================================================================================
15. COST OF SALES
===================================================================================
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Opening stock of work in process                        56,686,745       46,398,396
Add: material consumed                        15.1     549,273,514      506,734,580
Direct wages                                            24,764,871       24,673,573
Factory overheads                             15.2      85,279,837       69,039,512
                                                       659,318,222      600,447,665
                                                       716,004,967      646,846,061
Less: Closing stock of work in process                 (52,364,848)    (56,686,745)
Cost of goods manufactured                             663,640,119      590,159,316
Add: Opening stock of finished goods                    33,688,638       22,001,275
Cost of goods available for sale                       697,328,757      612,160,591
Less: Closing stock of finished goods                  (22,102,549)    (33,688,638)
                                                       675,226,208      578,471,953
===================================================================================
15.1. MATERIAL CONSUMED
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Opening stock                                           80,962,996       68,927,894
Purchases during the year                              542,302,836      518,769,682
Less: Closing stock                                    (73,992,318)    (80,962,996)
                                                       549,273,514      506,734,580
===================================================================================
15.2. FACTORY OVERHEADS
===================================================================================
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Salaries, allowances and benefits                       36,891,770       29,355,681
Professional services                                    1,268,090        1,224,600
Bonus                                                    5,909,653        4,611,778
Gratuity                                                         -        1,208,760
Rent, rates and taxes                                    2,761,627        2,131,244
Insurance                                                1,331,726          964,808
Power, electricity, gas and water                       13,521,247       11,499,063
Depreciation                                   8.1       9,249,133        7,343,464
Repairs, maintenance, cartage
 and conveyance                                         13,071,663        9,702,542
Laboratory expenses, research
 & development                                           1,274,928          997,572
                                                        85,279,837       69,039,512
===================================================================================
16. ADMINISTRATIVE EXPENSES
===================================================================================
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Salaries, allowances and benefits                       10,237,823        8,422,258
Bonus                                                    2,542,954        2,139,280
Gratuity                                                         -          510,861
Scholarship and donations                     16.1         152,500           75,000
Travelling                                               1,532,602          940,907
Rent, rates and taxes                                      311,402          260,075
Insurance                                                  696,758          684,842
Depreciation                                   8.1       1,778,075        2,273,363
Entertainment                                              199,009          228,837
Legal and professional                                     663,185          391,417
Printing stationery, books & periodicals                   855,234          958,383
Postage, telephone & telegraph                             668,973          728,471
Repairs and maintenance                                    783,411          634,978
Motor vehicles running                                   1,315,991        1,312,564
Electricity                                                458,437          304,673
Auditors remuneration                         16.2          78,750           78,750
Fee & subscriptions                                        273,826          183,610
Registrar services                                         242,523          212,900
Others                                                     120,874          117,704
                                                        22,912,327       20,458,873
===================================================================================
16.1. The directors or their spouses did not have any interest in the donee�s fund

16.2. AUDITORS� REMUNERATION
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Audit fee                                                   50,000           50,000
Out of pocket expenses                                      28,750           28,750
                                                            78,750           78,750
===================================================================================
17. SELLING AND DISTRIBUTION EXPENSES
===================================================================================
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Salaries, allowances and benefits                       16,732,156       12,269,210
Bonus                                                    2,948,091        2,382,252
Gratuity                                                         -          596,325
Travelling & daily allowances                            6,794,340        5,561,516
Rent, rates and taxes                                      134,500            1,000
Insurance                                                1,054,649        1,055,440
Depreciation                                   8.1       2,720,931        2,345,688
Entertainment                                              243,383          295,204
Postage, telephone & telegraph                           2,133,488        1,722,523
Printing stationery, books & periodicals                   961,730          861,280
Repairs and maintenance                                    281,981          600,592
Motor vehicles running                                   2,541,729        2,161,503
Sales promotion, meetings & conferences                  6,384,619        3,773,900
Legal, professional, trademark and registration          2,938,143        1,064,465
                                                        45,869,740       34,690,898
Advertisement and artwork                              121,192,591       93,188,281
                                                       167,062,331      127,879,179
===================================================================================
18. OTHER INCOME
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Export rebate                                              951,008          590,766
profit on sale of fixed assets                             819,147          402,838
Insurance claim                                            386,798                -
                                                         2,156,953          993,604
===================================================================================
19. FINANCIAL AND OTHER CHARGES
===================================================================================
                                                              2001             2000
                                                            Rupees           Rupees
===================================================================================
Mark-up and interest on long term loans                  2,813,004        1,442,258
Mark-up and interest on short term loans                11,186,541       11,045,289
Bank charges                                               149,693          126,243
Workers� profit participation fund                       1,908,704        1,208,000
Workers� welfare fund                                      347,878          459,000
                                                        16,405,820       14,280,790
===================================================================================
20. TAXATION
===================================================================================
                                                              2001             2000
                                              Note          Rupees           Rupees
===================================================================================
Current year                                  20.1       7,413,558        5,674,989
Deferred                                                 1,045,262        1,399,798
                                                         8,458,820        7,074,787
===================================================================================
20.1. Income tax assessments of the company upto assessment year 2000-2001 have been finalized. Appeals relating to assessment year 1989-90 to 1997-98 are pending for hearing before the Income Tax Appellate Tribunal.

Appeal is also pending for hearing before the Commissioner of Income Tax in respect of assessment year 1998-99.
21. BASIC EARNINGS PER SHARE
===================================================================================
                                                              2001             2000
===================================================================================
Profit after taxation                                   27,227,848       18,503,157
Number of ordinary shares                                4,250,538        4,250,538
Basic earnings per share                                      6.41             4.35
===================================================================================
There were no diluted potential shares as at the balance sheet date.
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