Attock Cement Industry Annual Report

Attock Cement Pakistan Limited
Flying into
Future
Contents
Vision & Mission Company Information Board of Directors Core Values Quality Policy Environmental Policy Corporate Social Responsibility (CSR)
03 04 06 11 12 13 14
Corporate Strategy Management Chairmans Review Directors Report Notice of the Thirty-Third (33rd) Annual General Meeting
19 22 26 28 38
Statement of Compliance with the Code of Corporate Governance Review Report to the Members on Statement of Compliance with Best Practices of Code of Corporate Governance Auditors Report to the Members Balance Sheet Profit and Loss Account
40
Cash Flow Statement Statement of Changes in Equity Notes to the Financial Statements Six Years at a Glance
42 43 46 48
Pattern of Shareholding Events of the Year Proxy Form
49 50 51 77 78 80
The future cannot be seen without a proper vision. We take our inspirations from the falcon, being as a brand and symbol: this is an icon of vigilance and endurance. After sustaining the tough times, we are experiencing pride and joy of achievements. Both production and performance has been extraordinary. New goals are set and we are ready to fly into the future with zeal and confidence. Just like FALCON
Vision
To be the leading organization continuously providing high quality cement, excelling in every aspect of its business and to remain market leader in Cement Industry.
Mission
To be a premier and reputable cement manufacturing company dedicated to become an industry leader by producing quality products, providing excellent services, enhancing customer satisfaction and maximizing shareholders' value through professionalism and dedicated teamwork.
Company Information
Board of Directors
Dr. Ghaith R. Pharaon (Chairman) Laith G. Pharaon Wael G. Pharaon Shuaib A. Malik Abdus Sattar Babar Bashir Nawaz Fakhrul Islam Baig
Company Secretary
Irfan Amanullah
Bankers
Chief Executive
Babar Bashir Nawaz
Alternate Directors
Shuaib A. Malik Irfan Amanullah
Audit Committee of the Board

Abdus Sattar Shuaib A. Malik Fakhrul Islam Baig Chairman Member Member
Faysal Bank Limited MCB Bank Limited National Bank of Pakistan Ltd. Allied Bank Ltd. Bank Al-Habib JS Bank Limited NIB Bank Limited United Bank Limited Meezan Bank Limited Barclays Bank PLC, Pakistan The Bank of Punjab Habib Bank Limited Askari Bank Limited
HR & Remuneration Committee

Shuaib A. Malik Abdus Sattar Babar Bashir Nawaz Chairman Member Member
Auditors
A.F. Ferguson & Co. Chartered Accountants
Plant
Hub Chowki Lasbella Baluchistan
Cost Auditors
Naveed Zafar Ashfaq Jaffery & Co. Chartered Accountants
Legal Advisor
Sattar & Sattar Attorneys at Law
Registered Office
Share Registrar
D-70, Block-4, Kehkashan-5 Clifton, Karachi-75600 Tel: (92-21) 35309773-4 UAN: (92-21) 111 17 17 17 Fax: (92-21) 35309775 Email: [email protected] Website: www.attockcement.com
Technology Trade (Pvt) Limited Dagia House, 241-C, Block-2 PECHS, Off: Shahrah-e-Quaideen, Karachi. Tel: (92-21) 34391316-17 Fax: (92-21) 34391318
Board of Directors
Dr. Ghaith R. Pharaon (Chairman)
06
Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2
Laith G. Pharaon
Wael G. Pharaon
Shuaib A. Malik
Abdus Sattar
Babar Bashir Nawaz
Fakhrul Islam Baig
Flying into
Future
07
We term ATTOCK as a community rather than an organization. The growth of the Company as well as its people goes sideways. The Management has always given priority to its cordial relations with its employees, customers and stakeholders. This indeed is our key of success and we are flying high to achieve the new levels.
Flying together to Make a Difference
Core Values
Ethics
The Company follows highest standards of ETHICS with special reference to business integrity and process transparency. All our standards and processes can stand the test of scrutiny. We maintain the highest level of integrity both as individuals and as a corporate organization.
Quality
The Company is committed to provide its customers QUALITY products that provide them best value for their money. We promote high standard and timely delivery of quality products.
People
The Company ensures that it operates in a safe environment conducive to efficient productivity. The Company is committed to provide an environment free from discrimination for its people. Open communication, participative decision making approach and nurturing of the leadership qualities are the values followed by the Company. An employee reward system has been developed guided by a transparent system of recognition. We encourage and respect team spirit among our human resources.
Business Excellence
The Company believes in maximizing shareholders' value through strategic investment, sustainable growth and application of best available technology to achieve desired results.
Flying into
Future
11
Quality Policy
We are committed to produce high quality, FALCON CEMENT which not only meets but exceeds the international quality standards. We aim to maintain leadership of our Cement Industry providing premium quality products and excellent services to our consumers. We work as a team of dedicated Professionals who achieve excellence through training, development and continuous technological up-gradation. We aim to implement and continually improve the effectiveness of our Quality Management System. We provide safe and conducive work environment to our staff by ensuring stringent standards of safety and health. We make a contribution towards the uplift of our environment and inhabitants of the surroundings.
Environmental Policy
ACPL is committed to produce premium quality cement while maintaining minimal environmental impact. Every endeavor will be made to effectively maintain and continually improve our processes/activities with respect to environment and maintain greenery within and around plant premises. As a responsible organization, ACPL will fulfill all the applicable legal, social and moral obligations related to environmental control. ACPL aims at contributing generously towards mitigating pollution effects and thus save this world for future generations.
Corporate Social Responsibility

We define Corporate Social Responsibility (CSR) as our commitment to work as partners with all our stakeholders to effectively improve the quality of life of the members of our workforce, their families and the local communities around our facilities. CSR is locally managed and specific responsibilities have been assigned for coordinating local projects, communicating CSR activities internally and to external stakeholders, establishing stakeholders' dialogue and relations, as well as participating in corporate monitoring, evaluation and reporting. Our CSR approach focuses on six main pillarsbusiness conduct, employment practices, occupational health and safety (OH&S), community involvement, customer and supplier relations, and monitoring and reporting. Employment Practices Attock Cement counted 819 employees as at June 30, 2012. A large share of this number live in Communities where we are a major employer and source of income. We pay competitive wages and offer employees numerous benefits, including professional development opportunities through internal training and payment of tuition for approved external programs. Occupational Health & Safety We are committed to provide healthy and safe workplaces. Towards this end, we have embarked on a comprehensive assessment and renewal of our approach to the management of occupational health and safety and all production facilities are fully compliant with quality standards. The Company operates a 6 beds hospital in the area near its factory premises. The treatment is free for the local communities. Medical camps are also organised in nearby goths to provide general medical treatment and medicines to sick and needy people.
14
Community Relations We are committed to be responsible neighbours. This means operating in compliance with applicable regulations and being an integral part of the life of our communities. We accomplish this through support of local nonprofit organizations, providing access to our properties and engaging in constant dialogue with residents to inform them of our activities and listen and respond to their concerns. Through these and other actions, we seek to make a difference in our community. Our presence has a measurable positive economic impact on our community. Our products are essential to the construction industry, a key driver of economic activity that generates significant direct and indirect benefits in the value chain. Because our cement is generally consumed in proximity to their source, their utilization benefits local communities. Combined with the salaries and benefits, direct and indirect taxes that we pay annually, as well as our capital expenditures, our presence has a measurable positive economic impact not only on our communities but also on the country as a whole.
Education The Company currently operates a Primary level school that imparts education to children of both plant employees and also those from neighbouring villages. The Company sponsored TCF-Dr. Rachad Pharaon Campus, primary section has started its academic activities from April, 2010 under the supervision of The Citizen Foundation (TCF), a non profit organization. Primary section has the capacity of over 300 students, having ten class rooms. The second phase of TCF-Dr. Rachad Pharaon Campus i.e. Secondary section is under construction and will Insha-Allah start its academic activities from 2013. This school has been equipped with all modern facilities.
16
Corporate Strategy
Objectives
The Company follows a duly approved Corporate Obiectives, which consists of the following main points. To maintain its position as a leading manufacturer of quality products that surpass both national and international standards. Growth, expansion and sustained profitability are the guiding principles of ACPL's business model. Focusing on the strategic plans to grow the business beyond the borders, while enhancing the market share locally in South. To retain its lines of processes at highest level of operational efficiency. To achieve competitive operating margins with continuous growth both in productivity and profitability. To provide competitive rate of return to its shareholders on their investments. To remain committed in delivering quality and value to its customers and providing high quality cement products suitable for all construction purposes. To embrace consistency in high standards of service delivery. To continue with the commitment to provide a secure and innovative workplace for all its human resources. To remain committed by producing products in an environmentally and socially responsible manner. To achieve these strategic corporate objectives, the Company generally follows the following broad and approved strategy.
Strategy
The Company would continue to invest in the product quality by enhancing and upgrading its production and quality facilities through strategic investments in its plant operations and ensure that such investment results in cost-effective operations. The company would also invest in continuous product development pegged on changing global and national market trends, industrial and hi-tech progression and dynamic customer needs. The company is dedicated to discover and implement change to achieve continuous customer satisfaction. The Company would supply its products in diverse markets to achieve a healthy and growth oriented sales mix, focus towards a strong presence of its products in all the markets to achieve dynamic financial results, with maximum returns to all the stakeholders. The Company would continue to invest in projects which ensure a healthy and safer environment for its employees. It would also continue to demonstrate its commitment to better and brighten lives for the community by sponsoring a wide range of community development projects. ACPL has played a major role and it will continue its contribution in building the nation.
Flying into
Future
19
Flying into new Horizons
The Company's strategy is very well defined and explores different regional markets to sell 100% of its production. During the current year, the Company exported 517,992 M Tons (28%) of its sales to the Markets of Iraq, Sri Lanka and South Africa. This not only helped the company towards profitability but also contributed towards the Country's foreign exchange reserve.
Management
Management Committee
The Committee meets under the chairmanship of the Group Regional Chief Executive to coordinate the activities and operations of the Company.
Procurement Committee
The Procurement Committee is responsible for ensuring that procurement of assets, goods and services is made in accordance with Company policies and procedures on competitive and transparent terms.
Executive Committee
CEO leads the Executive Committee. The Committee is responsible for preparing the strategic plan for the future growth of the Company. The Committee also reviews major projects and formulates recommendations after evaluation from technical and commercial aspects.
Risk Management Committee

The Risk Management Committee is responsible for ensuring that procedures to identify and continuously update risks are in place. The Committee oversees the process of assessment of the possible impact and likelihood of occurrence of identified risks. The Committee is also responsible for formulating a risk management response to effectively address and manage risks.
22
IT Steering Committee
IT Steering Committee is responsible for developing and implementing an IT strategy for the Company. The Committee oversees the automation of processes and systems in line with latest technology. The Committee is also responsible for development of contingency and disaster recovery plans.
Safety Committee
The Safety Committee reviews and monitors company wide safety practices. It oversees the safety planning function of the Company and is responsible for safety training and awareness initiatives.
Budget Committee
The Budget Committee reviews and approves the annual budget proposals prior to being presented for the approval of the Board. The Committee also monitors utilization of the approved budget.
Flying into
Future
23
Besides improvement in Production and Sales target, the Company is always striving for healthy environment. The Company has re-engineered its plant that will help to reduce Carbon footprints and make the facilities more environment friendly. The company installed Waste Heat Recovery Plant, that is not only producing electricity but also recycled the Waste Heat from the kiln and thus reduced Carbon emissions.
Flying into a Green world
Chairmans Review
I welcome you all in the 33rd Annual General Meeting of the Company.
Overview of the Economy
The fiscal year 2011-2012 saw numerous challenges to the economy including a sharp increase in oil prices in international markets, recessionary trends in global markets, severe energy crisis in the country, heavy rains in Sindh and a hostile law and order situation. Despite these challenges the country's economy performed reasonably well and posted a modest GDP growth of 3.7%. The country managed to maintain its exports and also attracted record remittances from overseas Pakistanis but balance of payment remained a source of worry for the economic managers due to higher oil prices and discontinuation of coalition support fund on account of war on terror resulting in a devaluation of PKR against US $ by almost 6% in the last quarter of the fiscal year 2011-2012. This devaluation may further increase the existing inflationary trend in the economy.
26
Business & Industry Review

During the year under review the cement production capacity of the country increased to 44.2 million tones and because of lower local demand the industry remained focus in exploring the export markets. Afghanistan, Iraq, Sri Lanka, South Africa, India and other African and Middle Eastern markets remained the targets of the major cement players. Though the country has a great potential for local consumption to grow but combination of unstable security situation and deepening energy crises has hampered the growth in the sector. Between 2004 - 2008, the FDI in construction sector was very strong but since 2009 the investment in construction sector has been reduced considerably resulting in stagnant local cement consumption figures. This year the overall local demand was at 23.9 million tones though higher by 8% as compared to previous year but the industry is still waiting for major infrastructure initiatives from the Government which may boost the local demand and bridge the huge supply demand gap currently looming over the industry. Though on a smaller scale a construction boom has been witnessed in the second half of the year 2011-2012 and last six months of the fiscal year have shown promising trend in this sector but all this was because of private sector initiatives. On fiscal side a positive indication has already been given by the government through reduction of excise duty in the federal budget. This is a recognition of fact that local cement industry has high incidence of indirect taxation and such further relief measures would contribute favourably towards the overall growth of the sector.
Operational and Financial Performance

The Company has performed remarkably well under the most difficult circumstances both operationally and financially. With both lines working efficiently and achieving a capacity utilization of 106% and 101%, the financial results have also shown considerable improvements. During the year the Company was able to sell its entire production capacity both in local and export markets and local sales was recorded at 1,337,480 tones whereas the export sales reached 517,992 tones. The Company managed its sales mix in such a manner that its net retention increased by 24% as against net increase of 12% in cost of production. Major cost saving initiative, WHRS project, was completed in December 2011 and it is now contributing positively towards cost of production and increase in margins. Second major cost saving initiative, Alternate Fuel Project, is currently underway and it is anticipated that during the year 2012-2013 it will also be commissioned. This project would also enhance the overall margins of the company. Overall profit after tax of the company has, therefore, increased by Rs. 753 million (110%) due to increase in net retention and significant contribution from WHRS project.
Acknowledgement
The Company deeply acknowledges and expresses its gratitude for the efforts and dedication of its human resource that has enabled the Management to run the operation seamlessly. The Company also acknowledges the support it has received from CBA on various matters. I also take this opportunity to express my sincere thanks to the government both federal and provincial, local administration, our customers, bankers and suppliers for their continuing support, cooperation and patronage.
Dr. Ghaith R. Pharaon Chairman September 15, 2012 Dubai, U.A.E.
Flying into
Future
27
In the name of Allah, The Most Gracious, The Most Benevolent & The Most Merciful.
Directors Report
The Directors' of your Company have pleasure to present before you the Annual Report of your Company along with audited financial statements for the year ended June 30, 2012.
Production & Sales Statistics
During the year 2011-2012, the Company achieved production of over 100% of its rated capacity both in line 1 and line 2. Dispatches were also recorded at an all time high volume. The detailed data has been enumerated in the table below along with comparison with previous year: 2011 - 2012 2010 - 2011 --------------- Tons --------------Clinker Production Cement Production Cement Dispatches Capacity Utilization 1,756,843 1,849,176 1,855,472 103% 1,819,458 1,862,201 1,849,851 106%
28
During the year under review, the company achieved an average rated capacity of 103%, with line 1 operating at 106% of its rated capacity and Line 2 operating at 101% of its rated capacity. The volumetric sales was the highest ever achieved by the Company surpassing all previous records. This is a significant milestone keeping in view the highly uncertain economic and political conditions, energy crisis, poor law and order situation and significant slowdown in the regional markets.
07-08
1,359
08-09
1,719
09-10
1,807
10-11
1,850 1,819
10-11
11-12
Cement Sales
Thousand M. Tonnes
07-08
1,360
08-09
1,679
09-10
1,706
11-12
Clinker Production
Thousand M. Tonnes
Flying into
Future
1,757
1,855
29
During the year under review the Company sold 1,337,480 tons of Cement (72% of its total sales) in the local market with Karachi remaining the principal market for the Company's products, where despite extremely poor law and order situation the Company was able to sell 72% of its total sales as compared to 70% in the preceding year, followed by interior Sindh and Baluchistan markets. The performance is commendable as there is always stiff competition in this market among the south based plants due to better net retention. The balance 517,992 tons (28% of total cement despatches) was exported to the regional markets of Iraq, Sri Lanka and South Africa. While every effort was made to maximize local sales specially in the core 2011 - 2012
market of Karachi, the Company still had to rely on exports for about 30% of its total sales even though prices in export markets were significantly lower than the local market. However, over the last couple of years the Company is managing its sales mix in such a manner that it can achieve maximum sales revenue and also achieve 100% capacity utilization.
FINANCIAL PERFORMANCE
A comparison of the key financial results of your Company for the year ended June 30, 2012 with the same period last year is as under: Increase Increase % 2,084 1,216 1,001 753 8.69 24 70 97 110 110
2010 - 2011 Rs. in million
Net Sales Gross Profit Profit Before Tax Profit After Tax EPS in Rupees
10,638 1,2,947 2,035 1,437 16.59
8,554 1,731 1,034 684 7.90
(ii) Profitability
Company earned a net profit after tax of Rs. 1,437 million as compared to Rs. 684 million earned during the corresponding period, showing a significant increase of Rs. 753 million (110%). The gross and operating margins also improved from 20% and 12% to 28% and 19% respectively. Increase in net profit and margins are mainly attributable to the following factors: The average combined net retention improved by Rs. 1,109 (24%) per ton over corresponding period mainly due to higher net retention achieved in both local market as well as in rupee based export sales. Overall Production cost increased by Rs. 457 per ton as compared to same period last year mainly due to increase in fuel cost and diesel prices. Even though the prices of coal remain stable as compared to last year but were offset by the devaluation of Pak Rupee against US Dollar resulting in a higher cost for the Company. With the commencement of 12 MW Waste Heat Recovery System (WHRS) from December 2011, the per ton electricity cost also reduced significantly. The commissioning of this project has greatly helped the Company to control the production cost which was showing a rising trend in the backdrop of double digit inflation, massive increase in power tariff and diesel prices and devaluation of PKR against US $.
2008
5,001
The overall sales revenue increased by Rs. 2,084 million (24%) as compared to last year. This is mainly attributable to increase in average net retention by Rs. 1,109 per ton of cement sold as compared to same period last year. This is the highest ever sales achieved by the company in terms of revenue.
8,510
2009
2010
7,668
2011
8,554
2012
Net Sale Revenue

Rupees in million
Distribution of Total Revenue
71% Cost of Sales 10% Operating Expenses 6% Corporate Taxes 13% Retained Profit
Flying into
Future
10,638
(i) Sales Performance
31
4,891
5,734
4,244
4,625
154 120 78 24
3,561
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
Net Retention
Rupees per ton
Finance Cost
Rupees in million
(iii) Appropriation
The financial results for the year under review are as follows: 2011-2012 2010-2011 Rs. in 000
Profit after tax Un-appropriated profit b/f Profit available for appropriation Appropriation: Final Cash Dividend paid for the year 2011: Rs. 4.50 per share (2010: Rs 3.25 per share) Interim Cash Dividend paid for the year 2012: Rs. 2.50 per share (2011: Rs Nil per share) Un-appropriated profit c/f (389,679) (216,489) 5,762,938 (281,436) 4,932,457 1,436,649 4,932,457 6,369,106 684,429 4,529,464 5,213,893
The Board of Directors in its meeting held on September 15, 2012 proposed a final cash dividend of Rs 6.00 per share (2011: Rs 4.50 per share) amounting to Rs 519.6 million (2011: Rs 389.7 million) and proposed a transfer of Rs 129.9 million from unappropriated profit to reserve for issuance of bonus shares (2011: Rs Nil) for issuance of three bonus shares for every twenty shares held (2011: Nil) subject to the approval of the company in the forthcoming annual general meeting.
1,989 2,035
1,493
1,388
1,034
1,017
675
2008
2009
2010
2011
2012
2008
435
2009
2010
2011
684
2012
Profit Before Tax

Rupees in million
Profit After Tax

Rupees in million
32
1,437
12
CONTRIBUTION TO NATIONAL EXCHEQUER

The Company contributed Rs. 2,247 million during the year to the national exchequer as well as Rs. 49 million were outstanding on account of statutory levies. An amount of approximately Rs. 187 million was also paid as withholding income tax deducted by the Company from shareholders, employees, suppliers and contractors. In addition to that your Company earned precious foreign exchange of approximate US $ 30 million during the year under review from export sales.
important tasks without any external assistance which shows the quality of its manpower. The Company follows the principle of acknowledging and rewarding high performing individuals through a quality incentive program which not only keep the staff motivating but also attract quality talent from the market. Our Management Trainee Program is designed to attract fresh graduates who possess significant abilities, with willingness to learn and believe in developing themselves as a team player. The Company provides different learning and growth opportunities to the local people through its structured apprenticeship program. It helps in giving the deprived a fair chance to get employment and learn to develop themselves as respectable individuals of society. During the year under review the Company successfully concluded CBA agreement for the year 2012 and 2013.
MARKETING
The year 2011-2012 was a very tough year from marketing point of view as during most part of the year the core market of Karachi remained disturbed because of poor law and order situation. The situation in Sindh market also remained uncertain in the first six months of the fiscal year due to heavy monsoon rains. This coupled with ongoing energy crisis, higher interest rates, lesser investments in real estate sector and lower spending from the government on development program made it difficult to maintain sales in the local market. As a result, despite lower prices, the company had to rely on exports to the extent of almost 28% of its total sales. Despite the above challenges, the Company by the grace of Almighty Allah and with the support of our customers was able to achieve 100% capacity utilization as against an industry average capacity utilization of 74%. During the year under review, the company launched a new product by the name of FALCON BLOCK CEMENT in the core market of Karachi to cater the need of block makers. The product was an instant success and was able to capture a sizable market share. The product has now become immensely popular among the block makers due to its quick setting time and is contributing favourably in the overall sales revenue of the company.
CORPORATE SOCIAL RESPONSIBILITY

ACPL continues to contribute sizable amount in various CSR related activities foremost among them being education and health. The Company's commitment towards providing quality education, training opportunities to local youth and health care to local inhabitants of the area where the manufacturing facilities of the company are located attracted applaud from local dignitaries and intellectuals, media and other social organizations. The Company's major education initiative i.e. The Citizen Foundation School - Dr. Rachad Pharaon Campus continued to provide quality education free of cost to the children of local area. The school has 24 classrooms with a capacity of over 600 students and is equipped with all modern facilities. A complete Medical Centre with state of the art medical equipments, team of qualified doctors and nursing staff is operational round the clock at plant site and provides free treatment to the local people. The Company operates two Welfare Dispensaries, located at the Medical Centre and Goth Sakran, which provide free medicines to the poor and needy people of the area. During the year company arranged 3 medical camps where the people of the area were treated without any charge. The company also conducted free eye camp where 12 cataract operations were carried out without any fee.
HUMAN RESOURCES
The Company remained focus in providing best career development opportunities for its human resource capital through management development programs and innovative work assignments and projects. With the less availabilities of foreign experts at plant site, it was company's own manpower resources who performed some of the most
Flying into
Future
33
SAFETY, HEALTH AND ENVIRONMENT (SHE)

We, at ATTOCK, take all possible measures to ensure that all our employees as well as communities within which we operate remain safe at all time. Environmental protection is a top priority on company's SHE agenda. The company ensures that its production processes are eco friendly and efficient. We constantly try and improve energy efficiencies both at production facilities and in our offices.
Rupees in Million Provident Fund (audited) Gratuity Funds (unaudited) Pension Funds (unaudited) 309 145 189
Year Ended December 2011 June 2012 June 2012
i)
During the year, five (5) meetings of the Board of Directors were held. Attendance of Directors and Chief Executive is as follows:
Name of the Directors / Chief Executive Dr. Ghaith R. Pharaon Mr. Laith G. Pharaon Mr. Wael G. Pharaon Mr. Shuaib A. Malik Mr. Abdus Sattar Mr. Babar Bashir Nawaz Mr. Fakhrul Islam Baig Chairman/ Non Executive Director Non Executive Director Non Executive Director Non Executive Director Independent Director Executive Director Executive Director No. of meetings attended 5* 4* 5* 5 5 5 5
No.
COMPLIANCE WITH CODE OF CORPORATE GOVERNANCE

The Directors hereby confirm that: a) The annexed financial statements present fairly the state of the affairs of the Company, the result of its operations, cash flows and changes in equity; b) Proper books of accounts have been maintained by the Company; c) Appropriate accounting policies have been consistently applied in preparation of financial statements and accounting estimates are based on reasonable and prudent judgment; d) International Financial Reporting Standards, as applicable in Pakistan, have been followed in preparation of financial statements; e) The system of internal control is sound in design and has been effectively monitored and implemented; f) There are no significant doubts upon the Company's ability to continue as a going concern;
2 3 4 5 6 7
* Overseas directors attended the meetings either in person or through alternate directors.
Leave of absence was granted to those Directors who could not attend some of the Board Meetings due to their other preoccupations. j) During the year, four (4) meetings of the Audit committee were held. Attendance of members is as follows:
Name of the member Mr. Abdus Sattar Mr. Shuaib A. Malik Mr. Fakhrul Islam Baig Chairman/ Independent Director Non Executive Director Executive Director No. of meetings attended 4 4 4
No. 1 2 3
g) There has been no material departure from the best practices of corporate governance as detailed in the listing regulations; h) The following is the value of investments of terminal benefit schemes based on their respective latest accounts;
k) During the year 2011-12, following directors have attended the Directors training programs:
No. 1 2 Name of the Director / Chief Executive Mr. Babar Bashir Nawaz Mr. Irfan Amanullah Executive Director Alternate Director
34
l)
The details of shares transacted by Directors, Executives and their spouses and minor children during the year 2011-2012 have been given on page 79.
Judgmental areas; Significant adjustments resulting from the audit; Going concern assumption; Changes in accounting policies and practices; Compliance with applicable accounting standards; Compliance with the listing regulations and other statutory and regulatory requirements; and Significant related party transactions.
m) The key operating and financial data for the last 6 years has been set out on page 77.
PATTERN OF SHAREHOLDING
The pattern of shareholding of the Company as at June 30, 2012 has been given on page 78.
AUDITORS
The retiring auditors, Messrs A.F. Ferguson & Co., Chartered Accountants retire at the conclusion of the 33rd Annual General Meeting and offer themselves for reappointment. The Audit Committee has recommended for their reappointment.
4. Review of management letter issued by external auditors and management response thereto. 5. Ensuring coordination between the internal and external auditors. 6. Review of the scope and extent of internal audit and ensuring that the internal audit function has adequate resources and is appropriately placed. 7. Consideration of major findings of internal investigations of activities characterized by fraud, corruption and abuse of power and management's response thereto. 8. Ascertaining that the internal control system includes financial and operational controls, accounting systems for timely and appropriate recording of purchases and sales, receipts and payments, assets and liabilities and the reporting structure are adequate and effective. 9. Review of statement on internal control systems prior to the endorsement by the Board of Directors. 10. Instituting special projects, value for money studies or other investigations on any matters specified by the Board of Directors, in consultation with the Chief Executive and to consider remittance of any matter to the external auditors or to any other external body. 11. Determination of compliance with relevant statutory requirements.
Flying into
AUDIT COMMITTEE
The Board of Directors has established an Audit Committee in compliance with the Code of Corporate Governance with the following members:
Mr. Abdus Sattar Chairman Independent Director Non-Executive Director Executive Director
Mr. Shuaib A. Malik
Member
Mr. Fakhrul Islam Baig
Member
Terms of Reference
The broad terms of reference of Audit committee are as follows: 1. Determination of appropriate measures to safeguard the assets. 2. Review of preliminary announcements of results prior to publication. 3. Review of quarterly, half yearly and annual financial statements prior to the approval by the Board of Directors, major focus on;
Future
35
12. Consideration of any other issue or matter as may be assigned by the Board of Directors. 13. External Auditors Recommendations regarding the appointment of External Auditors. Resignation and removal of External Auditors. Audit fees. Provision by external auditors of any services to the company in addition to the audit of the Financial Statements. Facilitating external audit and discussion with external auditors on major observations arising from interim and final audits and any other matter that auditors wish to highlight.
Consideration and approval on recommendation of CEO on such matters for key management positions who report directly to CEO or COO.
Alternate Fuel Project

As reported earlier, the company is installing an Alternate Fuel Project which will allow the Company to use alternate fuels like Municipal Waste, Shredded Tyres, Biomass etc. in place of existing primary fuel source i.e. coal and gas. A contract for supply of dosing and feeding system was signed with a renowned European supplier and the project is currently under implementation and is expected to be completed by early 2013. With the use of alternate fuel, the Company would be able to reduce its production cost to some extent.
Certified Emission Reductions (CER's)

As earlier reported, the Waste Heat Recovery Project is able to generate around 25,000 ~ 35,000 CERs under United Nation Framework Convention for Climate Change (UNFCCC). The project has been uploaded for registration on UNFCCC website and we are now awaiting final approval from Executive Board (EB) of UNFCCC. Once the project gets approval from Executive board the company would able to sell CERs in European exchange market and would generate additional income.
HR & REMUNERATION COMMITTEE

The Board, in compliance with the new Code of Corporate Governance has formed HR & Remuneration Committee comprising of the following members:
Mr. Shuaib A. Malik Mr. Abdus Sattar Mr. Babar Bashir Nawaz Non- Executive Director / Chairman Independent Director Executive Director
FUTURE OUTLOOK
The current business environment is extremely challenging for the cement industry in general and for the company in particular. Double digit inflation, energy crisis prevailing in the country and security issues have imbalanced the equation posing significant business risk for the management to maintain the margins. With the key power and freight costs and rupee devaluation would continue to hurt the profitability and plant efficiencies and productivity being already at maximum levels, the survival will only be through cost saving initiatives. The management is fully focused on maintaining the margins through cost reduction. One such initiative i.e. Waste Heat Recovery System has already commenced its production and work on other project i.e. Alternate Fuel Project has already been initiated.
Terms of Reference
The broad terms of reference of this committee are as follows: Recommending Human Resource Management policies to the Board; Recommending to the Board the selection, evaluation, compensation (including retirement benefits) and succession planning of the CEO; Recommending to the Board the selection, evaluation, compensation (including retirement benefits) and succession planning of the COO, CFO , Company Secretary and Head of Internal Audit; and
36
The long term stability of the cement sector is fully dependent upon the economy of the country and how it attracts much needed investment in infrastructure and real estate projects. With more and more people moving towards urban cities and towns the need of massive investment in housing and infrastructure projects can trigger the cement demand in medium term which may help the company to pass on the impact of rising cost to the consumers and maintain its margins. An upsurge in cement demand has been witnessed during the last quarter of fiscal year 2011-12 and it is anticipated that with elections around the corner the government would invest massively in projects of public interest which would keep this demand momentum going in the year 2012-13. Besides this, sufficient funds have been allocated for the development of new dams in the budget and this can also increase the cement demand. With the un-utilized cement capacity of around 10~12 million tones per annum in the country, the
company is also exposed to capacity utilization risk and the unstable political and law & order situation may affect the business strategies. However, your management is continuously addressing this challenge by implementing an optimum sales mix of local and export sales to maximize its sales revenue and maintain healthy margins. On behalf of the Board
Babar Bashir Nawaz Chief Executive September 15, 2012 Dubai, U.A.E.
Flying into
Future
37
Notice of the Thirty-Third (33rd) Annual General Meeting

Notice is hereby given that the 33rd Annual General Meeting of Attock Cement Pakistan Limited will be held on Friday, October 19, 2012 at 03:00 p.m. at Sheraton Hotel & Towers, Karachi to transact the following: 1. 2. To receive, consider and adopt the Audited Accounts of the company for the year ended June 30, 2012 together with the Report of Auditors and the Directors thereon. To consider and if thought fit, approve final cash dividend of 60% (Rs. 6 per share) as recommended by the Board of Directors for the year ended June 30, 2012. This is in addition to the interim cash dividend of 25% (Rs. 2.50 per share) already paid during the year. To appoint auditors for the financial year 2012-2013 and to fix their remuneration.
3.
Special Business
4. To approve the issue of bonus shares in the ratio of three (03) bonus shares for every twenty (20) ordinary shares (15%) held by the shareholders as recommended by the Board of Directors. To give effect to the above, the Directors have recommended to consider and if thought fit, pass with or without modification the following resolution as an ordinary resolution, RESOLVED THAT a sum of Rs. 129,893,159 (Rupees One Hundred Twenty Nine Million Eight Hundred Ninty Three Thousand One Hundred Fifty Nine Only) be capitalized out of the unappropriated profit of the company and applied towards the issue of 12,989,316 ordinary shares of Rs. 10/- each as fully paid bonus shares to be allocated to the shareholders in proportion of three (03) shares for every twenty (20) existing ordinary shares held by the members of the Company who are registered on the books of the company on October 10, 2012 and that, after allotment, such new shares shall rank pari passu in all respect with the existing ordinary shares of the Company. These bonus shares will not be eligible for the final cash dividend of 60% for the year ended June 30, 2012. Fraction shares to be allotted as a result of distribution of Bonus Shares be consolidated with the Company Secretary for sale in the open market in due course and proceeds be donated to The Citizen Foundation (TCF). For the purpose of giving effect to the foregoing, the Chief Executive and the Company Secretary be and are hereby authorised to take all necessary actions under the law and to settle any questions or difficulties that may arise in the distribution of the said Bonus Shares or in the disposal of fractions and payment of proceeds thereof. 5. The Company in its 28th Annual General Meeting had obtained approval of the shareholders for investments under Section 208 of the Companies Ordinance, 1984 and accordingly the shareholders of the Company are presented with the statement under Section 160(1)(b) of the Companies Ordinance, 1984 in compliance with the SRO 865(I)/2000 dated December 06, 2000 in case of decisions to make investments that have been made by the shareholders previously and have not yet been implemented. A statement under SRO 865(I)/2000 dated December 06, 2000 is being enclosed with this notice. By Order of the Board
Karachi: September 28, 2012
IRFAN AMANULLAH Company Secretary
Notes:
1. 2. 3. The Register of Members and Share Transfer Books of the Company will remain closed from Thursday October 11, 2012 to Friday October 19, 2012 (both days inclusive). Only those members whose names appear in the register of members of the Company as on October 10, 2012 are entitled to attend and vote at the meeting. A member entitled to attend and vote may appoint any other person as his / her proxy to attend and vote on his / her behalf. Proxies must be received at the Registered Office of the Company duly signed not later than 48 hours before the time of holding the meeting. Form of proxy is enclosed herewith.
38
4. 5.
Members who desire to stop deduction of Zakat from their dividends may submit a declaration on nonjudicial stamp paper duly signed as required under the law. Members are requested to provide by mail or fax their Computerised National Identity Card (CNIC) number or passport number, if foreigner (unless it has been provided earlier) to enable the Company to comply with relevant laws. SECP has also directed vide SRO No. 779(I)2011 dated August 18, 2011 to issue dividend warrant only crossed as A/c Payee only and should bear the valid Computerized National Identity Card (CNIC) Number of the registered member. Members, who have not yet submitted photocopy of their valid CNIC are requested to send the same at the earliest directly to the Company's Share Registrar M/s. Technology Trade (Pvt) Limited, Dagia House 241-C, Block-2, PECHS, Off: Shahrah-e-Quaideen, Karachi. As directed by SECP vide Circular No.18 of 2012 dated June 5, 2012, we give the shareholders the opportunity to authorise the Company to directly credit in their bank account with cash dividend, if any, declared by the company in future. If they wish that the cash dividend if declared by the company be directly, credited into their bank account, instead of issuing a dividend warrant, please provide the following details. Title of Bank Account Bank Account Number Bank's Name Branch Name and Address Cell number of Shareholder Landline number of Shareholder, if any
6.
7.
8.
Members are requested to notify any changes in their addresses immediately. CDC Account Holders will have to further follow the under mentioned guidelines as laid down in Circular No. 1 dated January 26, 2000 issued by the Securities & Exchange Commission of Pakistan.
A. For attending the meeting: i) ii) In case of individuals, the account holder or sub-account holder shall authenticate his / her Original CNIC at the time of attending the meeting. In case of corporate entity, the Board of Directors' 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.
B. For appointing Proxies: i) ii) iii) iv) v) In case of individuals, the account holder or sub-account holder shall submit the proxy form as per the 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 CNIC or the passport of the beneficial owners shall be furnished with the proxy form. The proxy shall produce his / her original CNIC or original Passport at the time of meeting. In case of corporate entity, the Board of Directors' resolution / power of attorney with specimen signature shall be submitted (unless it has been provided earlier) along with proxy form to the Company.
STATEMENT UNDER SRO 865(I)/2000 DATED DECEMBER 06, 2000 In the 28th Annual General Meeting held on October 22, 2007 shareholders approved investments in following associated companies: Pakistan Oilfields Ltd. Attock Refinery Ltd. (POL) (ARL) Attock Petroleum Ltd. National Refinery Ltd. (APL) (NRL)
No investment so far has been made in any of the above-mentioned associated concerns. 1. Reasons for not making investment The company has invested surplus cash in Projects which would constitute favourably towards its cost of production. 2. Major Change in financial position of investee companies since the date of last resolution There has been no major change in financial position of POL, ARL, APL and NRL.
Flying into
Future
39
Statement of Compliance with the code of corporate governance

For the year ended June 30, 2012
This statement is being presented to comply with the Code of Corporate Governance contained in Regulation No. 35 of listing regulations of the Karachi Stock Exchange in Pakistan 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: Independent Director* Mr. Abdus Sattar Non-Executive Directors Dr. Ghaith R. Pharaon Mr. Laith G. Pharaon Mr. Wael G. Pharaon Mr. Shuaib A. Malik Executive Directors Mr. Babar Bashir Nawaz Mr. Fakhr-ul-Islam Baig Mr. Irfan Amanullah (Alternate Director)
*The independent director meets the criteria of independence under clause i(b) of the Code 2002 since the present Board was elected in October 2011, prior to issuance of the revised Code in April 2012. The Code 2012 requires atleast one independent director as per the definition of independent director, which would be applicable from next election of directors. 2. 3. The directors have confirmed that none of them is serving as a director on more than seven listed companies, including this company. 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 an NBFI or, being a member of a stock exchange, has been declared as a defaulter by that stock exchange. No casual vacancy occurred in the Board of Directors during the year June 30, 2012. The company has prepared a Code of Conduct and has ensured that appropriate steps have been taken to disseminate it throughout the company along with its supporting policies and procedures. The Board has developed a vision/mission statement, overall corporate strategy and significant policies of the company. A complete record of particulars of significant policies along with the dates on which they were approved or amended was destroyed in fire incident. However, the company's management has recompiled the policy manual. All the powers of the Board have been duly exercised and decisions on material transactions, including determination of remuneration and terms and conditions of employment of the CEO, other executive and non-executive directors, have been taken by the Board. The meetings of the Board were presided over by the Chairman and, in his 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 meetings were appropriately recorded and circulated. All the directors of the Board are fully conversant with the duties and responsibilities as directors of corporate bodies. The Board had previously arranged an orientation course of the Code of Corporate Governance for its directors to apprise them of their roles and responsibilities. Further, the booklet on the Code as published by the Securities and Exchange Commission of Pakistan (SECP) has been circulated amongst the directors of the Board.
4. 5. 6.
7.
8.
9.
40
10. 11. 12. 13. 14. 15. 16.
The Board has approved the appointment, remuneration, and terms and conditions of employment of the Head of Internal Audit and the CFO, who is also the Company Secretary. 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. The financial statements of the company were duly endorsed by 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. The Board has formed an Audit Committee. It comprises of three members, of whom two are nonexecutive directors including the chairman of the committee. The meetings of the audit committee were held at least once in 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 the committee for compliance. The Board has formed an HR and Remuneration Committee. It comprises of three members, of whom two are non-executive directors including the chairman of the committee. The Board has outsourced the internal audit function to Ernst & Young Ford Rhodes Sidat Hyder & Co., Chartered Accountants, who are considered suitably qualified and experienced for the purpose and are conversant with the policies and procedures of the company. The statutory auditors of the company have confirmed that they have been given a satisfactory rating under the quality control review program of the Institute of Chartered Accountants of Pakistan (ICAP), that they or any of the partners of the firm, their spouses and 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 ICAP. 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. The 'closed period', prior to the announcement of interim/final results, and business decisions, which may materially affect the market price of company's securities, was determined and intimated to directors, employees and stock exchange. Material/price sensitive information has been disseminated among all market participants at once through the stock exchange. The related party transactions have been placed before the audit committee and approved by the Board of Directors along with pricing methods. The transactions were carried out on terms equivalent to those that prevail in the arm's length transactions. We confirm that all other material principles enshrined in the Code have been complied with.
17. 18.
19.
20.
21.
22. 23.
24.
On behalf of the Board
Babar Bashir Nawaz Chief Executive September 15, 2012 Dubai, U.A.E.
Flying into
Future
41
Review Report To The Members

on statement of compliance with 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 Attock Cement Pakistan Limited to comply with the Listing Regulation No. 35 of the Karachi Stock Exchange 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 company's 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 have not carried out any special review of the internal control system to enable us to express an opinion as to whether the Board's statement on internal controls covers all controls and the effectiveness of such internal controls. Further, Listing Regulations 35 (x) of the Karachi Stock Exchange requires 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 arm's length transactions and transactions which are not executed at arm's 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 undertaken at arm's 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 company's 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 June 30, 2012.
A. F. Ferguson & Co. Chartered Accountants Karachi September 26, 2012
42
Auditors' Report To The Members

We have audited the annexed balance sheet of Attock Cement Pakistan Limited as at June 30, 2012 and the related profit and loss account, 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 company's 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) in our opinion, proper books of account have been kept by the company as required by the Companies Ordinance, 1984; (b) 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;
(ii) the expenditure incurred during the year was for the purpose of the company's business; and (iii) the business conducted, investments made and the expenditure incurred during the year were in accordance with the objects of the company. (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, 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 company's affairs as at June 30, 2012 and of the profit, its cash flows and changes in equity for the year then ended; and (d) in our opinion Zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980), was deducted by the company and deposited in the Central Zakat Fund established under section 7 of that Ordinance.
A. F. Ferguson & Co. Chartered Accountants Karachi September 26, 2012 Name of the engagement partner: Syed Fahim ul Hasan
Flying into
Future
43
Financial Statements
Balance Sheet As at June 30, 2012

Note 2012 2011 Rupees '000
SHARE CAPITAL AND RESERVES Authorised capital 125,000,000 ordinary shares of Rs 10 each Issued, subscribed and paid-up capital Unappropriated profit NON-CURRENT LIABILITIES Deferred taxation CURRENT LIABILITIES Trade and other payables Accrued mark-up Taxation 5 1,205,215 129,297 1,334,512 CONTINGENCY AND COMMITMENTS 6 1,311,132 3,980 63,267 1,378,379 4 938,078 566,358 3 1,250,000 865,955 5,762,938 6,628,893 1,250,000 865,955 4,932,457 5,798,412
8,901,483
7,743,149
46
Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 12
Note
2012 2011 Rupees '000
NON-CURRENT ASSETS Fixed assets Long-term investment Long-term loans and advances Long-term deposits CURRENT ASSETS Stores, spares and loose tools Stock-in-trade Trade debts - considered good Loans and advances Short-term deposits and prepayments Accrued interest Other receivables Investments Cash and bank balances 15 16 17 13 14 11 12 1,419,739 539,343 190,444 35,390 13,902 2,149 57,909 879,362 219,762 3,358,000 1,342,341 541,028 50,772 25,754 11,789 2,149 47,419 116,064 210,165 2,347,481 7 8 9 10 5,471,655 4,500 24,348 42,980 5,543,483 5,331,951 4,500 16,237 42,980 5,395,668
8,901,483
7,743,149
The annexed notes 1 to 34 form an integral part of these financial statements.
Babar Bashir Nawaz Chief Executive
Abdus Sattar Director
Flying into
Future
47
Profit and Loss Account For the year ended June 30, 2012
Note 2012 2011 Rupees '000 10,638,021 (7,691,421) 2,946,600 20 21 22 23 (705,125) (221,577) (119,173) 145,899 2,046,624 24 (11,593) 2,035,031 25 (598,382) 1,436,649 1,436,649 26 Rs 16.59 8,553,921 (6,823,346) 1,730,575 (512,936) (186,365) (76,722) 104,221 1,058,773 (24,287) 1,034,486 (350,057) 684,429 684,429 Rs 7.90
Net sales Cost of sales Gross profit Distribution cost Administrative expenses Other operating expenses Other operating income Operating profit Finance cost Profit before taxation Taxation Profit after taxation Other comprehensive income Total comprehensive income Earnings per share
18 19
48
Cash Flow Statement For the year ended June 30, 2012
Note 2012 2011 Rupees '000
CASH FLOWS FROM OPERATING ACTIVITIES Cash generated from operations Finance cost paid Income tax paid (Increase) / Decrease in long-term loans and advances Net cash from operating activities 28 1,944,836 (15,573) (160,632) (8,111) 1,760,520 693,318 (20,307) (368,198) 685 305,498
CASH FLOWS FROM INVESTING ACTIVITIES Fixed capital expenditure incurred Proceeds on disposal of operating assets Purchase of open ended mutual fund units Proceeds from sale of open ended mutual fund units Interest received Net cash used in investing activities (448,942) 1,747 (3,130,000) 2,409,458 22,408 (1,145,329) (1,403,212) 2,324 (630,000) 1,751,290 23,244 (256,354)
CASH FLOWS FROM FINANCING ACTIVITY Dividends paid Net increase / (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year 17 (605,594) 9,597 210,165 219,762 (281,088) (231,944) 442,109 210,165
Flying into
Future
49
Statement of Changes in Equity For the year ended June 30, 2012
Share capital Unappropriated profit Rupees '000
Total
Balance as at June 30, 2010 Final dividend for the year ended June 30, 2010 @ Rs 3.25 per share Profit after taxation for the year ended June 30, 2011 Balance as at June 30, 2011 Final dividend for the year ended June 30, 2011 @ Rs 4.50 per share Interim dividend for the year ended June 30, 2012 @ Rs 2.50 per share Profit after taxation for the year ended June 30, 2012 Balance as at June 30, 2012
865,955
4,529,464
5,395,419
(281,436)
(281,436)
865,955
684,429 4,932,457
684,429 5,798,412
(389,679)
(389,679)
(216,489)
(216,489)
865,955
1,436,649 5,762,938
1,436,649 6,628,893
50
Notes to the Financial Statements For the year ended June 30, 2012
1. THE COMPANY AND ITS OPERATIONS The company was incorporated in Pakistan on October 14, 1981 as a public limited company and is listed on Karachi Stock Exchange. Its main business activity is manufacturing and sale of cement. The company's cement manufacturing plant is located in Tehsil Hub, District Lasbella, Balochistan. 2. 2.1 2.1.1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of preparation 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 or directives of the Companies Ordinance, 1984 shall prevail. Changes in accounting standards, interpretations and pronouncements a) Standards, interpretations and amendments to published approved accounting standards effective in current year but not relevant Certain standards, amendments and new interpretations to existing approved accounting standards are applicable from the current year. However, as these did not affect the financial statements, these have not been detailed here. b) Standards, interpretations and amendments to published approved accounting standards that are not yet effective but relevant IAS 19 (Amendment) 'Employee Benefits' is effective for the periods beginning on or after January 1, 2013. This amendment requires an entity to recognise actuarial gains and losses (renamed as remeasurements) immediately in other comprehensive income. Actuarial gains and losses will no longer be deferred using the corridor approach or recognised in profit or loss. Past service costs will be recognised in the period of a plan amendment and will no longer be spread over a futureservice period. A curtailment now occurs only when an entity significantly reduces the number of employees. Curtailment gains / losses are accounted for as past-service cost. Further, presentation and disclosure requirements have also changed. The company is yet to assess the full impact of the amendments. IFRS 13, Fair value measurement, is effective for annual periods beginning on or after 1 January 2013. The standard aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRSs. The requirements do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within IFRSs.
2.1.2
Flying into
Future
51
2.2 Basis of measurement These financial statements have been prepared under the historical cost convention except where stated otherwise in the accounting policies below. 2.3 Staff retirement benefits Defined benefit plans The company operates approved funded gratuity and pension schemes for its certain management and non-management employees. Contributions to the schemes are based on actuarial valuations. The latest actuarial valuations of the schemes have been carried out as at June 30, 2012 using the Projected Unit Credit method. Cumulative net unrecognised actuarial gains and losses at the beginning of the year which exceed 10% of the greater of the present value of the obligations and the fair value of the respective fund's assets are amortised over the average remaining working life of the employees. Retirement benefits are payable to employees on completion of prescribed qualifying period of service under the schemes. Defined contribution plan The company also operates an approved provident fund for its permanent employees. Equal monthly contributions are made, both by the company and the employees, at the rate of 10% of basic salary. 2.4 Trade and other payables Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method. 2.5 Provisions Provisions are recognised in the balance sheet when the company has a legal or constructive obligation as a result of past events, it is probable that an outflow of 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 current best estimate. 2.6 Taxation Current The charge for current taxation is based on taxable income at the current rates of taxation after taking into account tax credits, rebates available, if any.
52
Deferred Deferred tax is accounted for using the balance sheet liability method on all temporary differences arising between tax base of assets and liabilities and their carrying amounts in the financial statements. Deferred tax liability is generally recognised for all taxable temporary differences and deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which the deductible temporary differences, unused tax losses and tax credits can be utilised. Deferred tax is charged or credited in the profit and loss account. 2.7 Fixed Assets - property, plant and equipment These are stated at cost less accumulated depreciation / amortisation and impairment losses (if any) except freehold land, capital work-in-progress and stores held for capital expenditures which are stated at cost. Depreciation is calculated using the straight-line method on all assets in use to charge off their cost excluding residual value, if not insignificant, over their estimated useful lives. Depreciation on acquisition is charged from the month of addition whereas no depreciation is charged in the month of disposal. Company accounts for impairment, where indications exist, by reducing its carrying value to the estimated recoverable amount. Maintenance and normal repairs are charged to income as and when incurred. Major renewals and improvements are capitalised and the assets so replaced, if any, are retired. Gains and losses on disposal of fixed assets are included in income currently. 2.8 Borrowings and their cost Borrowings are recognised initially at fair value and subsequently at amortised cost using the effective interest method. Borrowing costs are recognised as an expense in the period in which these are incurred except to the extent of borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset. Such borrowing costs are capitalised as part of the cost of that asset. Borrowings payable within next twelve months are classified as current liabilities. 2.9 Investments The company determines the appropriate classification of its investment at the time of purchase as follows: Long-term investments The investment in associated company is stated at cost. Impairment loss is recognised whenever the carrying amount of investment exceeds its recoverable amount. An impairment loss is recognised in income currently. The equity method of accounting has not been followed as the effect of applying this method is immaterial.
Flying into
Future
53
Investments - held to maturity These are investments with fixed or determinable payments and fixed maturity with the company having positive intent and ability to hold till maturity. These are stated at amortised cost. Investments - at fair value through profit or loss Investments held for trading are classified at fair value through profit or loss account. These are measured at fair value which is re-assessed at each reporting date. In case of investments in open ended mutual funds, fair value is determined on the basis of period end Net Asset Value (NAV) as announced by the Asset Management Company. Changes in fair value are recognised in profit and loss account. 2.10 Stores, spares and loose tools These are valued at monthly weighted average cost less provision for slow moving and obsolete stores, spares and loose tools. Items in transit are stated at cost. 2.11 Stock-in-trade Stock are valued at lower of cost and net realisable value except goods-in-transit which are stated at cost. Raw and packing materials, work-in-process and finished goods are valued at the weighted average cost. Cost of work-in-process and finished stocks comprise of direct costs and appropriate portion of production overheads. Net realisable value is determined on the basis of estimated selling price of the product in the ordinary course of business less costs of completion and costs necessarily to be incurred in order to make the sale. 2.12 Trade debts and other receivables Trade debts and other receivables are recognised and carried at original invoice amount less a provision for impairment. A provision for impairment is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of receivables. Trade debts and other receivables considered irrecoverable are written-off. 2.13 Cash and cash equivalents Cash and cash equivalents are carried in the balance sheet at cost. For the purposes of cash flow statement, cash and cash equivalents comprise of cash and cheques in hand and in transit, balances with banks on current and deposit accounts and finance under mark-up arrangements. 2.14 Foreign currencies Transactions in foreign currencies are recorded in Pakistan Rupee at the rates of exchange approximating those prevailing at the date of transaction. Monetary assets and liabilities in foreign currencies are
54
translated into Pakistan Rupee using the exchange rates approximating those prevailing at the balance sheet date. Exchange differences are included in income currently. The financial statements are presented in Pakistan Rupee, which is the company's functional and presentation currency. 2.15 Revenue recognition Revenue is measured at the fair value of the consideration received or receivable, and represents amount receivable for goods supplied, stated net of discounts, returns and value added taxes. Revenue from sale of goods is recognised on despatch of goods to customers i.e. when the significant risks and reward of ownership have been transferred to the customer. Interest income is recognised using the effective interest method. Dividend income is recognised when the right to receive payment is established. 2.16 Financial assets and liabilities All financial assets and liabilities are initially measured at cost, which is the fair value of the consideration given and received respectively. These financial assets and liabilities are subsequently measured at fair value, amortised cost or cost, as the case may be. Financial assets and liabilities are off set and the net amount is reported in the balance sheet if the company has a legal right to set off the transaction and also intends either to settle on a net basis or to realise the asset and settle the liability simultaneously. 2.17 Dividend Dividend distribution to shareholders is accounted for in the period in which the dividend is declared. 2.18 Significant 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 management to exercise its judgement in the process of applying the company's accounting policies. The matters involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are: (i) Taxation - notes 4.1 & 25 (ii) Staff retirement benefits - note 5.3 Estimates and judgements are continually evaluated and adjusted based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Flying into
Future
55
3. ISSUED, SUBSCRIBED AND PAID UP CAPITAL Ordinary shares of Rs 10 each 2011 2012 29,747,965 4,132,510 29,747,965 Shares allotted for consideration paid in cash 4,132,510 Shares allotted for consideration other than cash - plant and machinery Shares allotted as bonus shares
2012 2011 Rupees '000
297,480
297,480
41,325 527,150 865,955
41,325 527,150 865,955
52,714,964 86,595,439 3.1
52,714,964 86,595,439
As at June 30, 2012, Pharaon Investment Group Limited (Holding) S.A.L., Lebanon and its nominees held 72,795,426 (2011: 72,795,426) ordinary shares of Rs 10 each.
2012 2011 Rupees '000 4. DEFERRED TAXATION Credit balances arising in respect of accelerated tax depreciation allowances Debit balances arising in respect of provision for slow moving and obsolete stores and spares 942,439 (4,361) 938,078 570,655 (4,297) 566,358
4.1
Deferred tax liability is restricted to 77.90% of the total deferred tax liability based on the following assumptions: - export sales will continue to fall under Final Tax Regime; and - historical trend of export and local sales ratio will continue to be the same in foreseeable future.
56
Note 5. TRADE AND OTHER PAYABLES Creditors Accrued liabilities Electricity charges payable Royalty payable Sales tax payable Excise duty payable Advances from customers Retention money Security deposits Workers' Profits Participation Fund Workers Welfare Fund Payable to Pension Funds Payable to Gratuity Funds Payable to Provident Funds Taxes deducted at source and payable to statutory authorities Unclaimed dividend Others 5.1 194,622 449,457 189,767 71,009 21,673 5,828 31,988 74,839 29,057 107,749 11,424 27 9,356 2,041 6,378 1,205,215 174,840 393,011 173,349 71,427 90,525 140,095 164,457 15,585 55,610 21,159 1,562 1,133 225 1,467 6,687 1,311,132 2012 2011 Rupees '000
5.2 5.3 5.3
5.1
5.1
Creditors, accrued liabilities and other liabilities include Rs 12.1 million, Rs 3.41 million and Rs 5.76 million (2011: Rs 6.04 million, Rs 3.55 million and Rs 5.76 million) respectively in respect of amounts due to related parties. Note 2012 2011 Rupees '000
5.2
Workers Profits Participation Fund At the beginning of the year Allocation for the year Interest on funds utilised in company's business Less: amount paid to the Fund 55,610 107,749 163,359 768 164,127 56,378 107,749 74,588 55,610 130,198 983 131,181 75,571 55,610
22
24
Flying into
Future
57
2012 2011 Gratuity Pension Gratuity Pension Funds Funds Funds Funds Rupees '000
5.3 5.3.1
Retirement benefits Movement in liability / (asset) Balance at July 1 Charge for the year Payments to / on behalf of the fund Balance at June 30
1,562 12,437 (13,972) 27
1,133 15,630 (25,623) (8,860)
(1,794) 12,077 (8,721) 1,562
673 16,452 (15,992) 1,133
5.3.2
Balance sheet reconciliation as at June 30 Present value of obligations Less: Fair value of assets Unrecognised actuarial (loss) / gain Unrecognised past service cost 202,548 (187,047) 15,501 (7,259) (8,215) 27 147,995 (150,325) (2,330) (6,530) (8,860) 169,002 (167,023) 1,979 10,538 (10,955) 1,562 139,448 (123,914) 15,534 (14,401) 1,133
5.3.3
Movement in the present value of defined benefit obligations and fair value of plan assets The movement in the present value of defined benefit obligations during the year is as follows: Balance at July 1 Current service cost Interest cost Actuarial loss / (gain) Benefits paid Balance at June 30 169,002 9,498 23,578 6,086 (5,616) 202,548 139,448 12,639 19,524 (8,204) (15,412) 147,995 151,528 9,870 19,364 (5,793) (5,967) 169,002 130,580 9,976 16,497 (10,249) (7,356) 139,448
The movement in the fair value of plan assets during the year is as follows: Balance at July 1 Expected return on plan assets Actuarial (loss) / gain Employer contributions Benefits paid Balance at June 30 167,023 22,256 (10,588) 13,972 (5,616) 187,047 123,914 16,771 (571) 25,623 (15,412) 150,325 145,943 17,678 648 8,721 (5,967) 167,023 101,084 12,649 1,545 15,992 (7,356) 123,914
58
2012 2011 Gratuity Pension Gratuity Pension Funds Funds Funds Funds Rupees '000 9,498 23,578 (22,256) (1,122) 2,739 12,437 11,668 12,639 19,524 (16,771) 238 15,630 16,200 9,870 19,364 (17,678) (643) 1,164 12,077 18,326 9,976 16,497 (12,649) 2,628 16,452 14,194
5.3.4
Charge for the year Current service cost Interest cost Expected return on assets Net actuarial (gain) / loss recognised Past service cost recognised
5.3.5 5.3.6
Actual return on plan assets Principal actuarial assumptions Expected return on plan assets % per annum Expected rate of increase in salaries % per annum Discount factor used (% per annum) Retirement age (years)
12.5 10.5 12.5 60
12.5 10.5 12.5 60
13 11 14 60
13 11 14 60
As per actuarial recommendation, the expected return on plan assets was determined by considering the expected returns available on the assets underlying the current investment policy. 2012 Pension Gratuity Funds Funds % % 2011 Pension Gratuity Funds Funds % %
5.3.7
Plan assets Plan assets are comprised of the following: Equity Bonds Others
1.89 5.48 92.63 100.00
0.62 7.14 92.24 100.00
3.79 6.06 90.15 100.00
5.68 8.16 86.16 100.00
5.3.8
Based on actuarial advice for the year ending June 30, 2013 expected contribution to pension funds would be Rs 15.77 million and expected contribution to gratuity funds would be Rs 9.07 million.
Flying into
Future
59
2012 5.3.9 Comparison for five years Pension funds Fair value of plan assets Present value of defined benefit obligations (Deficit) / Surplus Experience (loss) / gain on plan liabilities Experience (loss) / gain on plan assets Gratuity funds Fair value of plan assets Present value of defined benefit obligations Surplus / (Deficit) Experience gain / (loss) on plan liabilities Experience (loss) / gain on plan assets 2011 2010 Rupees '000 2009 2008
187,047 (202,548) (15,501) (6,086) (10,588)
167,023 (169,002) (1,979) 5,793 648
145,943 (151,528) (5,585) (2,224) (12,658)
143,619 (121,278) 22,341 9,889 5,601
127,091 (107,665) 19,426 18,741 (1,300)
150,325 (147,995) 2,330 8,204 (571)
123,914 (139,448) (15,534) 10,249 1,545
101,084 (130,580) (29,496) (3,704) 665
80,393 (108,733) (28,340) (18,003) (2,727)
82,557 (89,322) (6,765) (16) (1,254)
The above information is based on actuarial advice. 6. 6.1 CONTINGENCY AND COMMITMENTS The Competition Commission of Pakistan (CCP) passed an order on August 27, 2009 levying penalty of Rs 374 million on the company alleging that it was involved with other cement manufacturing companies in price fixing arrangements. The company alongwith other cement manufacturers challenged the vires of CCP order before the Lahore High Court which directed the CCP not to take any adverse action against the company under the aforementioned order passed by CCP till the completion of the case proceedings in the Lahore High Court. Simultaneously, the company also filed a writ petition against CCP before the Sindh High Court contending that the CCP order is illegal, issued without lawful authority and is corum non-judice. The Sindh High Court has granted an ad-interim injunction suspending the operation of CCP order. The company has also filed an appeal against CCP's order in the Supreme Court of Pakistan. Based on the opinion of the company's legal advisors, the management is hopeful that the ultimate outcome of these petitions / appeal will be in favour of the company and hence no provision has been recognised in these financial statements for the aforementioned amount of penalty. 6.2 Commitments for capital expenditure outstanding as at June 30, 2012 amounted to Rs 416.60 million (2011: 166.93 million).
60
Note 7. FIXED ASSETS Operating assets Capital work-in-progress Stores held for capital expenditures 7.1 7.3 2012 2011 Rupees '000 4,897,742 135,762 438,151 5,471,655 3,670,788 1,281,828 379,335 5,331,951
7.1
Operating assets
Buildings Quarry and roads transport on Furniture Plant and and Office freehold and fittings machinery equipment equipments land Rupees '000
4,554 4,554 1,010,536 (310,677) 699,859 6,012,883 (3,146,089) 2,866,794 197,399 (146,261) 51,138 24,422 (15,004) 9,418 76,462 (65,720) 10,742 81,046 (52,763) 28,283 7,407,302 (3,736,514) 3,670,788
Freehold land
At July 01, 2011 Cost Accumulated depreciation Net book value Year ended June 30, 2012 Opening net book value Additions Disposals - note 7.2 Transfers to stores Depreciation charge Closing net book value At June 30, 2012 Cost Accumulated depreciation Net book value At July 01, 2010 Cost Accumulated depreciation Net book value Year ended June 30, 2011 Opening net book value Additions Disposals Transfers to stores Depreciation charge Closing net book value Rate of depreciation % 4,554 4,554 4,554 4,554 4,554 4,554 4,554 4,554
Vehicles
Total
699,859 210,922 (52,844) 857,937
2,866,794 1,341,012 (37,769) (226,802) 3,943,235
51,138 2,191 (9,337) 43,992
9,418 1,261 (3,681) 6,998
10,742 5,499 (5,575) 10,666
28,283 13,076 (839) (10,160) 30,360
3,670,788 1,573,961 (839) (37,769) (308,399) 4,897,742
1,221,458 (363,521) 857,937
7,313,547 (3,370,312) 3,943,235
199,586 (155,594) 43,992
25,683 (18,685) 6,998
81,959 (71,293) 10,666
85,810 (55,450) 30,360
8,932,597 (4,034,855) 4,897,742
1,005,560 (263,086) 742,474
5,827,020 (2,956,255) 2,870,765
189,372 (137,148) 52,224
22,616 (11,436) 11,180
70,997 (57,408) 13,589
79,129 (44,154) 34,975
7,199,248 (3,469,487) 3,729,761
742,474 4,976 (47,591) 699,859 5%
2,870,765 220,587 (34,724) (189,834) 2,866,794 5%
52,224 8,027 (9,113) 51,138 10%
11,180 1,806 (3,568) 9,418 20%
13,589 5,465 (8,312) 10,742 25%
34,975 5,458 (3,541) (8,609) 28,283 20%
3,729,761 246,319 (3,541) (34,724) (267,027) 3,670,788
Flying into
Future
61
7.2 The details of operating assets sold, having net book value in excess of Rs 50,000 each are as follows:
Description Cost Accumulated Net book depreciation value Rupees '000 559 62 Sale proceed Mode of disposal Particulars of purchaser
Vehicle
621
465
Tender
"
621
559
62
505
"
"
622
560
62
124
Company policy " " " " " " "
Mr. Saqlain Shah Ward No. 4, Mohalla Gorzyaanwala, Tehsil Kot Addu, District Muzaffargarh, Punjab Mr. Qamar Raza House No. A-79, Block-13, Gulistan-e-Johar, Karachi Mr. Ghazanfar Khan Suri - Ex-Employee Syed Agha Abbas - Employee Sheikh Tariq Jamil - Employee Mr. Khizar Hayat - Employee Syed M. Wasi Zaidi - Employee Mr. Masroor Pervaiz -Employee Mr. M. Nasir Khan - Employee Mr. Atta M. Shakir - Ex-employee
" " " " " " "
621 979 979 969 969 1,376 555 8,312
559 881 881 872 872 1,239 491 7,473
62 98 98 97 97 137 64 839
62 98 98 97 97 137 64 1,747
7.3
Capital work-in-progress Plant and machinery Civil works Electrical and mechanical work Advances to suppliers - plant and machinery - civil works - electrical and mechanical works Borrowing cost Others
2012 2011 Rupees '000 12,952 13,345 7,770 76,558 12,449 5,926 6,762 135,762 1,030,633 157,736 68,125 1,129 4,439 11,632 8,134 1,281,828
62
8.
LONG-TERM INVESTMENT Investment in related party (associated company) Attock Information Technology Services (Private) Limited - 450,000 (2011: 450,000) fully paid ordinary shares of Rs 10 each - at cost
2012 2011 Rupees '000
4,500
4,500
8.1
The company holds 10% (2011: 10%) of investee's total equity. The break-up value per share is Rs 20.36 (2011: Rs 18.18). Total assets and total liabilities of the investee as at June 30, 2012 amounted to Rs 97.32 million and Rs 5.70 million (2011: Rs 87.44 million and Rs 5.62 million) respectively. Note LONG-TERM LOANS AND ADVANCES Considered good Chief Executive Executives Other Employees Recoverable within one year Long term portion 13 2012 2011 Rupees '000 9,826 18,135 24,535 52,496 (28,148) 24,348 1,281 13,868 22,964 38,113 (21,876) 16,237
9.
9.1
Reconciliation of the carrying amount of loans and advances to Chief Executive and Executives: Chief Executive Executives 2012 2011 2012 2011 Rupees '000 1,281 3,842 13,868 11,590 11,411 16,883 9,985 (2,866) (2,561) (12,616) (7,707) 9,826 1,281 18,135 13,868
Opening balance Disbursements Repayments
9.2
Amounts receivable from Chief Executive and Executives represent house rent advances given according to the companys service rules. Executives and other employees are also provided with car, motor cycle, marriage and welfare loans. These loans and advances are recoverable in twelve to sixty monthly installments and are interest free. These loans and advances are secured against the retirement fund balances of employees. The maximum amounts due from Chief Executive and Executives at the end of any month during the year were Rs 11.09 million (2011: Rs 3.62 million) and Rs 18.14 million (2011: Rs 14.36 million) respectively.
9.3
Flying into
Future
63
10. LONG-TERM DEPOSITS These are security deposits held with The Karachi Electric Supply Company Limited (KESC) and carry interest at the rate of 5% (2011: 5%) per annum. 11. STORES, SPARES AND LOOSE TOOLS Bricks Coal (including in transit Rs 630.4 million; 2011: Rs 83.6 million) Stores and spares (including in transit Rs 17.6 million; 2011: Rs 28.3 million) Loose tools Less: Provision for slow moving and obsolete items 2012 2011 Rupees '000 42,130 1,071,554 320,065 1,986 1,435,735 15,996 1,419,739 44,900 976,226 336,968 1,490 1,359,584 17,243 1,342,341
12.
STOCK-IN-TRADE Raw materials Packing materials Work-in-process Finished goods 91,230 66,656 295,418 86,039 539,343 52,354 62,165 328,384 98,125 541,028
13.
LOANS AND ADVANCES - Considered good Current portion of long-term loans and advances Chief Executive and Executives Other Employees Other advances - employees Advances to suppliers 15,242 12,906 28,148 54 7,188 35,390 10,004 11,872 21,876 104 3,774 25,754
14.
SHORT-TERM DEPOSITS AND PREPAYMENTS Deposits - considered good Prepayments 3,288 10,614 13,902 3,736 8,053 11,789
64
Note 15. OTHER RECEIVABLES Sales tax recoverable Inland freight subsidy receivable Export rebate receivable Due from Gratuity Funds Due from Provident Fund Due from related parties Others 21,416 8,938 8,860 12,676 4,413 1,606 57,909 20,232 12,056 8,760 3,956 2,415 47,419 2012 2011 Rupees '000
5.3
16.
INVESTMENTS Investments - at fair value through profit and loss 16.1 879,362 116,064
16.1
These represent investments in open ended mutual funds (quoted). The details of investments are as follows:
2012 2011 --------------- Units --------------700,420 1,754,677 1,962,913 987,533 2,024,839 498,107 1,008,799 5,034,614 500,439 150,000 ABL Cash Fund Lakson Money Market Fund MCB Islamic Income Fund Askari Soverign Cash Fund First Habib Cash Fund HBL Money Market Fund IGI Money Market Fund MCB Cash Management Optimizer Meezan Cash Fund PICIC Income Fund
2012 2011 Rupees '000 70,806 177,295 201,969 100,239 202,715 24,935 101,403 879,362 50,492 50,534 15,038 116,064
16.1.1 The fair value of these investments is the Net Asset Value (NAV) as at June 30, 2012 as quoted by the respective Asset Management Company.
Flying into
Future
65
Note 17. CASH AND BANK BALANCES Cash at bank - On PLS saving accounts - On current accounts Cash and cheques in hand 17.1 129,798 89,549 415 219,762 155,423 54,581 161 210,165 2012 2011 Rupees '000
17.1
At June 30, 2012 the mark-up rates on PLS saving accounts ranging from 5% to 10.80% (2011: 5% to 11.30%) per annum. 2011 2012 Rupees '000
18.
NET SALES Local sales Export sales Sales tax Special excise duty Federal excise duty
10,038,613 2,647,024 12,685,637 (1,383,273) (664,343) (2,047,616) 10,638,021
8,311,061 2,445,639 10,756,700 (1,193,656) (93,131) (915,992) (2,202,779) 8,553,921
18.1
18.2
The revenue from customers which individually exceeded 10% of the net revenue, either in current year or prior year, amounted to Rs 2 billion, Rs 1.3 billion and Rs 0.03 billion (2011: Rs 1.9 billion, Rs 1.4 billion and Rs 1.3 billion) respectively. 2012 2011 Rupees '000 Export sales comprise of sale made in the following regions: Middle East Asia Africa Others 1,961,303 538,191 147,530 2,647,024 1,882,010 446,592 117,037 2,445,639
66
Note 19. COST OF SALES Raw materials consumed Packing materials consumed Cement packaging and loading charges Salaries, wages and benefits Fuel Electricity and water Stores and spares consumed Repairs and maintenance Insurance Vehicle running and maintenance Travelling and entertainment Communication Printing and stationery Security expenses Depreciation (Reversal of) / Provision for slow moving and obsolete stores, spares and loose tools Other expenses Add: Opening work-in-process Less: Closing work-in-process Cost of goods manufactured Add: Opening stock of finished goods Less: Closing stock of finished goods 705,275 699,998 17,857 751,486 3,076,756 1,520,706 318,950 73,857 45,909 77,712 6,572 779 2,334 48,961 300,241 (1,247) 223 7,646,369 328,384 (295,418) 7,679,335 98,125 7,777,460 (86,039) 7,691,421 646,211 663,606 17,526 582,731 2,691,772 1,647,920 270,187 51,449 28,822 63,987 3,825 932 2,356 44,544 262,930 868 2,969 6,982,635 221,139 (328,384) 6,875,390 46,081 6,921,471 (98,125) 6,823,346 2012 2011 Rupees '000
19.1
19.1
Salaries, wages and benefits include Rs 21.27 million and Rs 16.56 million (2011: Rs 21.03 million and Rs 13.23 million) in respect of charge for defined benefit plans and contributory provident fund respectively.
Flying into
Future
67
Note 20. DISTRIBUTION COST Salaries, wages and benefits Handling and other export related expenses Commission on local sales Commission on export sales Advertisement and sales promotion PSI marking fee Carriage outward - on local sales - on export sales Travelling and entertainment Vehicle running and maintenance Printing and stationery Communication Other expenses 20.1 50,174 216,475 134,123 42,391 364 10,639 9,743 235,270 4,772 793 27 175 179 705,125 43,804 206,709 50,210 695 8,559 9,410 189,784 2,404 723 226 126 286 512,936 2012 2011 Rupees '000
20.1
Salaries, wages and benefits include Rs 1.44 million and Rs 1.08 million (2011: Rs 1.72 million and Rs 1.06 million) in respect of charge for defined benefit plans and contributory provident fund respectively. Note 2012 2011 Rupees '000
21.
ADMINISTRATIVE EXPENSES Salaries, wages and benefits Travelling and entertainment Vehicle running and maintenance Depreciation Rent, rates and taxes Utilities Communication Insurance Repairs and maintenance Printing and stationery Advertising Subscription Legal and professional charges Auditors remuneration Donations Training Other expenses 21.1 149,562 6,669 6,458 8,158 8,255 3,720 4,302 3,237 3,141 4,787 1,287 1,282 7,501 2,372 3,997 616 6,233 221,577 115,498 6,207 5,827 8,681 7,945 4,312 3,635 9,279 2,942 4,568 1,461 744 4,584 2,187 5,595 320 2,580 186,365
21.2 21.3
68
21.1 Salaries, wages and benefits include Rs 5.36 million and Rs 3.82 million (2011: Rs 5.61 million and Rs 3.14 million) in respect of charge for defined benefit plans and contributory provident fund respectively. Auditors' remuneration Audit fee Fee for review of half yearly financial statements and Statement of Code of Corporate Governance Taxation services Other certifications, attestations and other services Out-of-pocket expenses 21.3 22. None of the Directors or their spouses had any interest in donees. Note OTHER OPERATING EXPENSES Workers' Profits Participation Fund Workers' Welfare Fund 23. OTHER OPERATING INCOME Income from financial assets Interest income on: - deposit accounts - PLS savings accounts - security deposit with KESC Gain on sale of open ended mutual fund units Gain on re-measurement of fair value of open ended mutual fund units Exchange gain Income from non-financial assets Gain on disposal of operating assets Others Export rebate Scrap sales Sales tax refund Reversal of provision for Workers' Welfare Fund Others 5.2 2012 2011 Rupees '000 107,749 11,424 119,173 55,610 21,112 76,722 2012 2011 Rupees '000 1,200 750 80 100 242 2,372 1,100 610 87 90 300 2,187
21.2
20,259 2,149 22,408 33,394 9,362 42,756 25,139
6,934 13,664 2,149 22,747 42,018 1,064 43,082 6,419
908
730
16,239 7,036 21,416 9,563 434 145,899

Flying into
15,767 14,638 838 104,221
Future
69
2012 2011 Rupees '000 24. FINANCE COST Mark-up on short term loan Mark-up on running finance Bank charges and commission Interest on Workers' Profits Participation Fund 25. TAXATION Current Deferred 25.1 Relationship between tax expense and accounting profit Profit before taxation Tax at the applicable rate of 35% Flood surcharge Effect of final tax regime 2,035,031 712,261 (113,879) 598,382 1,034,486 362,070 24,500 (36,513) 350,057 226,662 371,720 598,382 382,000 (31,943) 350,057 130 10,695 768 11,593 1,587 6,176 15,541 983 24,287
26.
EARNINGS PER SHARE Profit after taxation Number of ordinary shares outstanding at the end of year (in thousands) Earnings per share 1,436,649 86,595 Rs 16.59 684,429 86,595 Rs 7.90
26.1
Diluted earnings per share has not been presented as the company did not have any convertible instruments in issue as at June 30, 2012 and 2011 which would have any effect on the earnings per share if the option to convert is exercised. CREDIT FACILITIES The facilities for short term running finance available amounted to Rs 1.3 billion (2011: 1.23 billion). The rates of mark-up ranging between one month KIBOR minus 0.5% and 3 months KIBOR plus 0.25% (2011: one month KIBOR minus 0.5% and 3 months KIBOR plus 0.25%) per annum.
27.
70
The facilities for opening letters of credit and guarantee as at June 30, 2012 amounted to Rs 3.23 billion (2011: Rs 3.17 billion) of which unutilised balance at year end amounted to Rs 2.67 billion (2011: Rs 2.61 billion). The above arrangements are secured by way of charge over stocks and book debts and equitable mortgage of fixed assets. 2012 2011 Rupees '000 2,035,031 1,034,486
28.
CASH GENERATED FROM OPERATIONS Profit before taxation Add / (Less): Adjustments for non-cash charges and other items Depreciation Gain on disposal of operating assets Gain on sale of open ended mutual fund units Gain on re-measurement of fair value of open ended mutual fund units Interest income Finance cost Profit before working capital changes Effect on cash flow due to working capital changes (Increase) in current assets Stores, spares and loose tools Stock-in-trade Trade debts Loans and advances Short term deposits and prepayments Other receivables (Decrease) / Increase in current liabilities Trade and other payables
308,399 (908) (33,394) (9,362) (22,408) 11,593 253,920 2,288,951
271,611 (730) (42,018) (1,064) (22,747) 24,287 229,339 1,263,825
(77,398) 1,685 (139,672) (9,636) (2,113) (10,490) (237,624) (106,491) (344,115)
(695,847) (174,858) 4,594 20,378 (1,251) (18,583) (865,567) 295,060 (570,507) 693,318
Cash generated from operations
1,944,836
Flying into
Future
71
29. REMUNERATION TO CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES
The aggregate amounts charged in these financial statements for remuneration to Chief Executive, Directors and Executives are as follows:
Chief Executive 2012 2011 Executive Directors 2012 2011 Rupees '000 10,169 2,300 438 4,247 1,676 3,243 22,073 2 8,652 3,439 705 3,550 870 4,144 21,360 2 Executives 2012 2011 98,804 33,161 6,803 60,703 18,549 17,757 235,777 76 68,039 25,486 5,203 26,045 12,695 10,648 148,116 57
Managerial remuneration Housing allowance Utility allowance Bonus Retirement benefits Others
12,679 4,438 1,691 6,339 2,122 2,741 30,010 1
10,566 3,698 1,409 4,350 1,719 2,435 24,177 1
Number of person(s)
The Chief Executive, Executive Directors and certain executives are provided with free use of company maintained cars and are also provided with medical facilities in accordance with their entitlements. A sum of Rs 0.32 million (2011: Rs 0.32 million) was paid to a non-executive Director in respect of advisory services. In addition to the above, fee to two non-executive directors during the year amounted to Rs 1.17 million (2011: Rs 1.12 million).
30.
TRANSACTIONS WITH RELATED PARTIES Transactions with related parties during the year are as follows: Holding company Dividend paid Recovery of expenses Associated companies Purchases of goods Reimbursement of expenses Reimbursement of staff cost on secondment Recovery of expenses from related parties Recovery of staff cost on secondment Other related parties Payments made to retirement benefit funds Key management compensation Salaries and other short-term employee benefits Post-employment benefits
2012 2011 Rupees '000
509,568 825 253,639 3,492 513 8,832 1,055 96,294 59,340 4,275
236,585 765 216,235 3,740 405 8,152 763 42,686 53,054 3,429
The related party status of outstanding balances as at June 30, 2012 is included in other receivables, loans and advances and trade and other payables.
72
31. 31.1 FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES Financial risk factors The company's activities expose it to variety of financial risks namely market risk (including interest rate risk, currency risk and other price risk), credit risk and liquidity risk. The company's overall risk management programme focuses on having cost effective funding as well as manage financial risk to minimise earnings volatility and provide maximum return to shareholders. 31.2 Financial assets and liabilities by category and their respective maturities
Interest bearing Maturity up to one year Financial assets Loans and receivables Loans and advances Deposits Trade debts Interest accrued Other receivables Cash and bank balances Long term investment Fair value through profit or loss Investments June 30, 2012 June 30, 2011 Financial liabilities At amortised cost Trade and other payables June 30, 2012 June 30, 2011 On balance sheet date gap June 30, 2012 June 30, 2011 129,798 155,423 42,980 42,980 172,778 198,403 24,687 (728,365) 28,848 20,737 53,535 (707,628) 226,313 (509,225) 129,798 155,423 42,980 42,980 172,778 198,403 879,362 1,229,902 276,630 28,848 20,737 879,362 1,258,750 297,367 879,362 1,431,528 495,770 129,798 42,980 42,980 129,798 28,202 3,288 190,444 2,149 36,493 89,964 24,348 4,500 52,550 3,288 190,444 2,149 36,493 89,964 4,500 52,550 46,268 190,444 2,149 36,493 219,762 4,500 Maturity after one year Total Non-interest bearing Maturity up Maturity to one after one year year Rupees '000 Total Total
1,205,215 1,205,215 1,004,995
1,205,215 1,205,215 1,004,995
1,205,215 1,205,215 1,004,995
Flying into
Future
73
a) Market Risk (i) Interest rate risk Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in the market interest rates. As at June 30, 2012, the company is not exposed to interest rate risk as company's significant interest bearing assets are on fixed interest rates. (ii) Foreign exchange risk Foreign currency risk arises mainly where payables and receivables exist due to transactions in foreign currencies. At June 30, 2012, trade and other payables of Rs 79.04 million (2011: Rs 35.26 million) and trade debts of Rs 74.54 million (2011: Rs 6.10 million) are exposed to foreign currency risk. As at June 30, 2012, if the Pakistan Rupee had weakened / strengthened by 9% against US Dollar with all other variables held constant, profit before tax for the year would have been lower / higher by Rs 0.42 million (2011: Rs 2.74 million), mainly as a result of foreign exchange losses / gains on translation of US Dollar denominated trade and other payables, and trade debts. The sensitivity of foreign exchange rates looks at the outstanding foreign exchange balances of the company only as at the balance sheet date and assumes this is the position for a full twelvemonth period. The volatility percentages for movement in foreign exchange rates have been used due to the fact that historically (five years) rates have moved on average basis by the mentioned percentages per annum. (iii) Price risk Price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market prices, whether those changes are caused by factors specific to the fund, or its management company. The company limits price risk by maintaining a diversified portfolio and by continuous monitoring of developments in open ended income funds. In addition, the company actively monitors the key factors that affect the open ended income funds. The maximum exposure to price risk as at June 30, 2012 amounts to Rs 879 million (2011: Rs 116 million). As at June 30, 2012, if the prices of the open ended income funds had increased / decreased by 1% with all other variables held constant, profit before tax for the year would have been higher / lower by Rs 8.79 million (2011: Rs 1.16 million), mainly as a result of gains / losses on open ended income funds classified as fair value through profit and loss.
74
b) Credit risk Credit risk represents the accounting loss that would be recognised at the reporting date if counterparts failed to perform as contracted. The maximum exposure to credit risk is equal to the carrying amount of financial assets. Out of the total financial assets of Rs 1,432 million the financial assets exposed to the credit risk amounts to Rs 1,427 million. The carrying values of financial assets which are neither past due nor impaired are as under: 2012 2011 Rupees '000 Trade debts Deposits, loans, advances and other receivables Investments at fair value through profit or loss Bank balances 190,444 137,875 879,362 219,347 1,427,028 50,772 114,430 116,064 210,004 491,270
Trade debts of the company are not exposed to significant credit risk as the company trades with credit worthy third parties and obtains bank guarantees from its credit customers. As of June 30, 2012, secured and unsecured trade debts amounted to Rs 167 million and Rs 23 million (2011: Rs 41 million and Rs 10 million) respectively. Moreover, there is no past due or impaired balance and the carrying amount of trade debts relates to customers for whom there is no history of default. Deposits, loans, advances and other receivables are not exposed to any material credit risk as deposits of Rs 43 million are maintained with The Karachi Electric Supply Company Limited (KESC) and advances to employees amounting to Rs 53 million (2011: Rs 38 million) are secured against their retirement benefits. The fair value through profit or loss investments represent investments in open ended mutual funds. The company manages its credit and price risk by investing in income based diversified mutual funds. The cash and bank balances represent low credit risk as major balances are placed with banks having credit ratings of A or above as assigned by PACRA or JCR-VIS. c) Liquidity risk Liquidity risk reflects the company's inability in raising funds to meet commitments. The company manages liquidity risk by maintaining sufficient cash and bank balances and the availability of financing through banking arrangements. As at June 30, 2012 there is no maturity mismatch between financial assets and liabilities that expose the company to liquidity problems as described in maturity table. d) Fair values of the financial instruments The carrying value of all the financial instruments reflected in the financial statements approximate their fair values.
Flying into
Future
75
31.3 Capital Risk Management The company's objectives when managing capital are to safeguard company's ability to continue as a going concern in order to provide returns for shareholders and benefit for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. The company finances its operations and manages its working capital through equity. 2012 2011 (Metric tons) 32. CAPACITY AND PRODUCTION Production capacity - Clinker - Cement Actual production - Clinker - Cement 33. SUBSEQUENT EVENTS The Board of Directors in its meeting held on September 15, 2012 proposed a final cash dividend of Rs 6.00 per share (2011: Rs 4.50 per share) amounting to Rs 519.6 million (2011: Rs 389.7 million) and proposed a transfer of Rs 129.9 million from unappropriated profit to reserve for issuance of bonus shares (2011: Rs Nil) for issuance of three bonus shares for every twenty shares held (2011: Nil) subject to the approval of the company in the forthcoming annual general meeting. 34. DATE OF AUTHORISATION FOR ISSUE These financial statements were approved and authorised for issue by the Board of Directors on September 15, 2012. 1,756,843 1,849,176 1,819,458 1,862,201 1,710,000 1,795,500 1,710,000 1,795,500
76
Six years at a Glance

2011-12 Production and Sales Clinker production (in tonnes) Capacity utilization % Cement production (in tonnes) Cement sales (in tonnes) Profit & Loss Net sales Cost of sales Gross profit Other income Operating profit Profit before tax Profit after tax Balance Sheet Paid-up capital Unappropriated profit Long term & deferred liabilities Current liabilities Fixed assets less depreciation Other long term assets Current assets Key Financial Ratios Gross profit % Operating profit % Net profit after tax % Return on equity % Return on capital employed % No. of days in inventory No. of days in receivables Fixed assets turnover ratio (times) Current ratio (times) Price earning ratio (times) Dividend yield ratio % Dividend payout ratio % Dividend cover ratio (times) Debt: equity ratio Interest cover ratio (times) Shares and Earnings Market price / share as at June 30 (Rs.) Earnings per share (Rs.) Cash dividend per share Bonus shares issued % Break-up value per share 81 16.59 8.5 15 76.55 49 7.90 4.5 66.96 66 11.74 5.0 62.31 70 17.24 5.0 20 66.21 77 6.03 1.5 48.99 122 11.02 4.5 47.06 27.70 19.24 13.51 21.68 30.88 25.59 6.53 1.94 2.52 4.91 9.58 51.23 1.95 176.54 20.23 12.38 8.00 11.80 18.26 28.94 2.17 1.60 1.70 6.20 9.18 56.96 1.76 43.59 25.53 19.12 13.26 18.85 24.46 23.40 2.64 1.82 2.62 5.62 7.57 42.59 2.35 18.88 31.83 24.77 17.54 31.24 36.12 38.63 1.99 2.05 2.43 4.06 7.14 29.00 3.45 0.13 17.60 22.28 16.58 8.70 12.32 16.95 38.40 3.58 1.15 1.51 12.79 1.95 24.88 4.02 0.23 5.38 34.10 28.40 17.46 23.45 27.13 33.57 1.59 1.03 1.27 11.07 3.69 40.77 2.45 0.29 12.69 866 5,763 938 1,335 5,472 72 3,358 866 4,932 566 1,378 5,332 64 2,347 866 4,529 598 1,065 4,202 64 2,793 722 4,043 1,059 1,136 4,144 67 2,762 722 2,785 1,359 980 4,333 58 1,480 722 2,674 1,377 1,012 4,443 57 1,285 10,638 7,691 2,947 146 2,047 2,035 1,437 8,554 6,823 1,731 104 1,059 1,034 684 7,668 5,710 1,958 262 1,466 1,388 1,017 8,510 5,801 2,709 167 2,108 1,989 1,493 5,001 3,887 1,114 28 829 675 435 4,560 3,006 1,555 23 1,295 1,193 796 1,756,843 1,819,458 106 103 1,849,176 1,862,201 1,855,472 1,849,851 1,706,299 100 1,792,619 1,807,077 1,678,619 98 1,721,665 1,719,162 1,359,766 80 1,364,511 1,359,487 1,314,666 76 1,234,878 1,228,793 2010-11 2009-10 2008-09 2007-08 2006-07 Rupees in million unless otherwise stated
Flying into
Future
77
Pattern of Shareholding As on June 30, 2012

No. of Shareholders
215 178 228 207 58 22 11 6 8 4 6 2 3 1 2 1 1 3 2 5 2 1 1 1 3 1 1 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 994
Shareholdings From
1 101 501 1001 5001 10001 15001 20001 25001 30001 35001 40001 45001 55001 65001 70001 75001 80001 90001 95001 105001 110001 125001 130001 145001 155001 160001 180001 190001 205001 230001 255001 265001 295001 310001 325001 330001 390001 395001 405001 495001 595001 625001 675001 995001 1190001 72700001
To
100 500 1000 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000 60000 70000 75000 80000 85000 95000 100000 110000 115000 130000 135000 150000 160000 165000 185000 195000 210000 235000 260000 270000 300000 315000 330000 335000 395000 400000 410000 500000 600000 630000 680000 1000000 1195000 72800000
Total Shares Held

5,879 53,790 158,129 483,531 427,204 265,099 201,481 135,184 236,500 135,334 233,780 86,957 146,948 57,992 140,000 70,305 78,754 250,500 187,500 494,768 218,203 112,500 129,570 132,818 447,600 160,000 160,755 366,310 192,500 209,496 234,725 257,496 266,193 300,000 313,207 326,599 332,601 391,536 396,500 406,896 500,000 600,000 626,521 677,112 1,000,000 1,191,240 72,795,426 86,595,439
78
Categories of shareholder 1 2 3 4 DIRECTORS AND THEIR SPOUSE(S) AND MINOR CHILDERN ASSOCIATED COMPANIES, UNDERTAKINGS AND RELATED PARTIES EXECUTIVES BANKS, DEVELOPMENT FINANCIAL INSTITUTIONS, NON BANKING FINANCIAL INSTITUTIONS, INSURANCE COMPANIES, TAKAFUL AND MODARABAS MUTUAL FUNDS SHAREHOLDERS HOLDING 5% OR MORE OTHERS - Institutions - Public sector companies - Individuals
Shares held
Percentage
11 -
0.00 0.00 0.00
1,797,573 2,961,637 72,795,426 2,823,328 1,967,352 4,250,112 86,595,439
2.08 3.42 84.06 3.26 2.27 4.91 100
6 7 8
Shareholders holding Five Percent or more voting interest in the listed Company Total Paid-up Capital of the Company 5% of the paid-up capital of the Company 86,595,439 Shares 4,329,772 Shares
Name of Shareholders Pharaon Investment Group Limited, Holding S.A.L. Beirut, Lebanon
Description Falls in Category # 7
No. of Shares held 72,795,426
Percentage 84.06
No Shares were transacted by the Chief Executive, Directors, Executives and their spouses and minor Childern from July 01, 2011 to June 30, 2012 in the shares of the Company. However, on July 18, 2012 the Chief Executive of the Company has purchased 100,000 ordinary shares of the company. The transaction has been duly advised to the Karachi Stock Exchange vide letter dated July 19, 2012 to meet the requirements of Regulation No. 16(6) of the Listing Regulations of Karachi Stock Exchange.
Flying into
Future
79
Events of the Year
80
32nd Annual General Meeting
Flying into
Future
81
Annual Sales Convention
82
Long Service Award Ceremony
Flying into
Future
83
Alternate Fuel Project
84
Form of proxy AAAA
33rd Annual General Meeting of Attock Cement Pakistan Limited

I/We of. being a member(s) of Attock Cement Pakistan Limited holding ordinary shares as per share register folio No. or CDC participant ID No. and sub-account No. hereby appoint of Or failing him / her of as my / our Proxy in my / our absence to attend and vote for me / us and on my / our behalf at the 33rd Annual General Meeting of the Company to be held on October 19, 2012 and at any adjournment thereof. Signed this day of 2012.
Signature
(Signature must agree with the specimen signature registered with the Company)
Witness: 1. Name: Address: CNIC / Passport No.
2.
Name: Address: CNIC / Passport No.
Important: 1. This Proxy Form, duly completed and signed, must be received at the Registered Office of the Company, D-70, Block4, Kehkashan-5, Clifton, Karachi-75600, not less than 48 hours before the time of holding the meeting and must be duly signed and witnessed. A Proxy need not be a member of the Company. If a member appoints more than one proxy and more than one instrument of proxy are deposited by a member with the Company, all such instruments of proxy shall be rendered invalid.
2. 3.
For CDC Account Holders / Corporate Entities: 1. The proxy form shall be witnessed by two persons whose names, addresses and CNIC numbers shall be mentioned on the form. Attested copies of CNIC or the passport of the beneficial owners and the proxy shall be furnished with the proxy form. The proxy shall produce his/her original passport at the time of the meeting. In case of Government of Pakistan, State Bank of Pakistan, Corporate entity, the Board of Directors' resolution / power of attorney with specimen signature shall be submitted along with proxy form to the Company.
2. 3. 4.
Attock Cement Pakistan Limited

D-70, Block-4, Kehkashan-5 Clifton, Karachi-75600 Tel: (92-21) 35309773-4 UAN: (92-21) 111 17 17 17 Fax: (92-21) 35309775 Email: [email protected] Website: www.attockcement.com

Attock Cement Industry Annual Report

Uploaded by

Copyright:

Available Formats

Attock Cement Industry Annual Report

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Attock Cement Industry Annual Report

Uploaded by

Copyright:

Available Formats

Attock Cement Pakistan Limited

Pattern of Shareholding Events of the Year Proxy Form

Babar Bashir Nawaz

Audit Committee of the Board

HR & Remuneration Committee

A.F. Ferguson & Co. Chartered Accountants

Hub Chowki Lasbella Baluchistan

Naveed Zafar Ashfaq Jaffery & Co. Chartered Accountants

Sattar & Sattar Attorneys at Law

Dr. Ghaith R. Pharaon (Chairman)

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Babar Bashir Nawaz

Fakhrul Islam Baig

Flying together to Make a Difference

Corporate Social Responsibility

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Flying into new Horizons

Risk Management Committee

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Flying into a Green world

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Business & Industry Review

Operational and Financial Performance

Dr. Ghaith R. Pharaon Chairman September 15, 2012 Dubai, U.A.E.

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

2010 - 2011 Rs. in million

10,638 1,2,947 2,035 1,437 16.59

8,554 1,731 1,034 684 7.90

Net Sale Revenue

Distribution of Total Revenue

(i) Sales Performance

Profit Before Tax

Profit After Tax

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

CONTRIBUTION TO NATIONAL EXCHEQUER

CORPORATE SOCIAL RESPONSIBILITY

SAFETY, HEALTH AND ENVIRONMENT (SHE)

Year Ended December 2011 June 2012 June 2012

COMPLIANCE WITH CODE OF CORPORATE GOVERNANCE

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Mr. Shuaib A. Malik

Mr. Fakhrul Islam Baig

Alternate Fuel Project

Certified Emission Reductions (CER's)

HR & REMUNERATION COMMITTEE

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Notice of the Thirty-Third (33rd) Annual General Meeting

Karachi: September 28, 2012

IRFAN AMANULLAH Company Secretary

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

Statement of Compliance with the code of corporate governance

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2

10. 11. 12. 13. 14. 15. 16.

On behalf of the Board

Review Report To The Members

A. F. Ferguson & Co. Chartered Accountants Karachi September 26, 2012

Attock Cement Pakistan Limited A n n u a l R e p o r t 2 0 1 2