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Interim Financial Report
for the nine months ended September 30, 2015
Pak Elektron Limited
CONTENTS
Pak Elektron Limited
Corporate InformationDirectors’ Review
0203
STAKEHOLDERS’ INFORMATION
Condensed Interim Consolidated Balance SheetCondensed Interim Consolidated Profit and Loss Account / Statement of Comprehensive IncomeCondensed Interim Consolidated Cash Flow StatementCondensed Interim Consolidated Statement of Changes in EquityCondensed Interim Notes to the Consolidated Financial Information
CONDENSED INTERIM CONSOLIDATED FINANCIAL INFORMATION
0608
091011
CONDENSED INTERIM SEPARATE FINANCIAL INFORMATION
Condensed Interim Balance SheetCondensed Interim Profit and Loss Account / Statement of Comprehensive IncomeCondensed Interim Cash Flow StatementCondensed Interim Statement of Changes in EquityCondensed Interim Notes to the Financial Information
2022
232425
CONTENTS
Pak Elektron Limited
Corporate InformationDirectors’ Review
0203
STAKEHOLDERS’ INFORMATION
Condensed Interim Consolidated Balance SheetCondensed Interim Consolidated Profit and Loss Account / Statement of Comprehensive IncomeCondensed Interim Consolidated Cash Flow StatementCondensed Interim Consolidated Statement of Changes in EquityCondensed Interim Notes to the Consolidated Financial Information
CONDENSED INTERIM CONSOLIDATED FINANCIAL INFORMATION
0608
091011
CONDENSED INTERIM SEPARATE FINANCIAL INFORMATION
Condensed Interim Balance SheetCondensed Interim Profit and Loss Account / Statement of Comprehensive IncomeCondensed Interim Cash Flow StatementCondensed Interim Statement of Changes in EquityCondensed Interim Notes to the Financial Information
2022
232425
Pak Elektron Limited | Interim Financial Report September 30, 2015
Board of Directors
Audit Committee
Company Secretary
Chief Financial Officer
Mr. M. Naseem Saigol
Chairman - Executive
Mr. M. Murad Saigol
Chief Executive - Executive/Certified (DTP)
Mr. M. Azam Saigol
Director - Non Executive
Mr. Muhammad Zeid Yousuf Saigol
Director - Executive/Certified (DTP)
Mr. Haroon Ahmad Khan
Director - Executive/Certified (DTP)
Syed Manzar Hassan
Director - Executive
Syed Zubair Ahmad Shah
Director - NIT Nominee/Independent
Mr. Wajahat A. Baqai
Director - NBP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Akbar Hassan Khan
Director - NBP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Usman Shahid
Director - NBP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Khalid Siddiq Tirmizey
Director - BOP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Munaf IbrahimDirector - Independent
Mr. M. Azam Saigol
Chairman/Member
Mr. Usman Shahid
Member
Syed Zubair Ahmad Shah
Member
Mr. Haroon Ahmad KhanMember
Muhammad Omer Farooq
Syed Manzar Hassan, FCA
HR & Remuneration Committee
Auditors
Legal Advisor
Share Registrar
Bankers
Mr. M. Azam Saigol
Chairman/Member
Mr. Haroon Ahmad Khan
Member
Syed Zubair Ahmad Shah
Member
Syed Manzar HassanMember
M/s Rahman Sarfaraz Rahim Iqbal Rafiq Chartered Accountants
M/s Hassan & Hassan Advocates
Corplink (Private) Limited
Wings Arcade, 1-K Commercial Model Town, Lahore.
Tel: 042-35839182, 35887262
Fax: 042-35869037
Albaraka Islamic Bank
Askari Bank Limited
Bank Alfalah Limited
Bank of Khyber
Bank of Punjab
Burj Bank Limited
Faysal Bank Limited
Bank Islami Pakistan
MCB Bank Limited
National Bank of Pakistan
NIB Bank Limited
Pak Brunei Investment Company Limited
Pak Libya Holding Company (Private) Limited
Silk Bank Limited
Soneri Bank Limited
Standard Chartered Bank
Summit Bank Limited
CORPORATE INFORMATION DIRECTORS’ REVIEW
Registered Office
Works
Transformer Facility
Karachi
Islamabad
China
17-Aziz Avenue, Canal Bank, Gulberg V, Lahore.
Tel: 042-35718274-6
Fax: 042-35762707
Email: shares@saigols.com
14-K.M. Ferozepur Road, Lahore.
Tel: 042-35920151-9 (9 Lines)
34-K.M. Ferozepur Road, Keath Village, Lahore.
Tel: 042-35935151-2
Kohinoor Building, 25-West Wharf Road, Karachi.
Tel: 021-32200951-4
Fax: 021-32310303
Room # 301, 3rd Floor, Green Trust Tower, Blue Area, Islamabad.
Tel: 051-2824543, 2828941
Fax: 051-2273858
206, No. 1007, Zhong Shan Naun Er Road, Shanghai, China.
Tel: 86-21-64567713
Fax: 86-21-54109971
Nine month ended up to Rupees in thousandsSeptember 30, 2015 September 30, 2014
Increase /(Decrease)
Sales
Gross Profit
Profit before tax
Profit after tax
Earnings per share - Rupees
21,956,250
6,119,251
3,170,490
2,660,427
6.60
18,507,755
4,839,566
1,931,982
1,614,204
4.52
3,448,495
1,279,685
1,238,508
1,046,223
02 03
Dear Shareholders
Your directors are pleased to present the un-audited interim financial information of the Company for the nine months period ended September 30, 2015. The Company has registered positive sales growth of 18.63% as compared to the corresponding period of last year. In absolute terms, sales revenue was reported at Rs. 21.956 billion against Rs.18.508 billion of the corresponding period of last year. The company continued to make center of its efforts on disciplined cost management which resulted in gross profit expansion to Rs.1.280 billion. The positive improvement in the gross margin has trickled down to the bottom line resulting in enhanced net profit after tax & Earnings per share. Profit after tax achieved is Rs. 2.660 billion against Rs.1.614 billion of the respective period of last year, showing a growth of 64.81 %. EPS achieved is Rs. 6.60 as compared to Rs. 4.52 of corresponding period of last year showing a growth of 46.02%.
Summarized results are as below:
During the period under review, overall economy of the country has illustrated a growing trend. In the wake of the energy crisis, and the need for investment in distribution network besides generation, the present government is expected to remain steadfast in providing a feasible market business atmosphere in the country.
The Company continued to surpass its previous records in the nine months ended September 30, 2015 against comparative volume of previous corresponding period. Appliances Division has achieved sales of Rs 12.762 billion against sale of Rs.10.572 billion of corresponding period of last year. Robust marketing and advertising strategies, persistent cost cutting focus and major R & D initiatives have been the main drivers of consistent growth in appliances division. Sales have also grown up for deep freezers and split ACs. PEL Deep Freezer is well received among the corporate customers as well as at domestic level. Customization according to the requirement of the corporate customer is the Strength of PEL. By following international standards & Protocols, Product Quality and Strong After sales Service, PEL has created strong Good will with Customers Like Unilever (Walls), Engro Foods (O'more), Pakistan Dairies (Igloo) and PEPSI etc. PEL split A.C is well received in market due to its durability, quality, brand equity and after sales services backup. To sum up, there has been a moderate growth of home appliances products produced by the company during this period.
Power Division sales have witnessed a decent growth against the prior period, primarily on the back of higher number of sales orders from WAPDA and EPC division. Sales achieved during the period are Rs. 9.194 billion i.e. 16 % higher as compared to the corresponding period of previous year. The Company's strategic focus to cater the demand pertaining to expansion requirement & strengthening of distribution network and infrastructure in the country is main driver of the volumetric growth in orders. This has also enabled the Company to secure a market leading position in the production of Distribution Transformer, Power Transformer, Switch Gear and as an EPC Contractor.
In the wake of the above-mentioned factors, the Company aims to operate at its optimal efficiency to achieve further growth by employing working capital management, cost containment measures and improved processes.
APPLIANCES DIVISION
POWER DIVISION
Pak Elektron Limited | Interim Financial Report September 30, 2015
Board of Directors
Audit Committee
Company Secretary
Chief Financial Officer
Mr. M. Naseem Saigol
Chairman - Executive
Mr. M. Murad Saigol
Chief Executive - Executive/Certified (DTP)
Mr. M. Azam Saigol
Director - Non Executive
Mr. Muhammad Zeid Yousuf Saigol
Director - Executive/Certified (DTP)
Mr. Haroon Ahmad Khan
Director - Executive/Certified (DTP)
Syed Manzar Hassan
Director - Executive
Syed Zubair Ahmad Shah
Director - NIT Nominee/Independent
Mr. Wajahat A. Baqai
Director - NBP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Akbar Hassan Khan
Director - NBP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Usman Shahid
Director - NBP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Khalid Siddiq Tirmizey
Director - BOP Nominee U/S 182 of the Ordinance/Non Executive
Mr. Munaf IbrahimDirector - Independent
Mr. M. Azam Saigol
Chairman/Member
Mr. Usman Shahid
Member
Syed Zubair Ahmad Shah
Member
Mr. Haroon Ahmad KhanMember
Muhammad Omer Farooq
Syed Manzar Hassan, FCA
HR & Remuneration Committee
Auditors
Legal Advisor
Share Registrar
Bankers
Mr. M. Azam Saigol
Chairman/Member
Mr. Haroon Ahmad Khan
Member
Syed Zubair Ahmad Shah
Member
Syed Manzar HassanMember
M/s Rahman Sarfaraz Rahim Iqbal Rafiq Chartered Accountants
M/s Hassan & Hassan Advocates
Corplink (Private) Limited
Wings Arcade, 1-K Commercial Model Town, Lahore.
Tel: 042-35839182, 35887262
Fax: 042-35869037
Albaraka Islamic Bank
Askari Bank Limited
Bank Alfalah Limited
Bank of Khyber
Bank of Punjab
Burj Bank Limited
Faysal Bank Limited
Bank Islami Pakistan
MCB Bank Limited
National Bank of Pakistan
NIB Bank Limited
Pak Brunei Investment Company Limited
Pak Libya Holding Company (Private) Limited
Silk Bank Limited
Soneri Bank Limited
Standard Chartered Bank
Summit Bank Limited
CORPORATE INFORMATION DIRECTORS’ REVIEW
Registered Office
Works
Transformer Facility
Karachi
Islamabad
China
17-Aziz Avenue, Canal Bank, Gulberg V, Lahore.
Tel: 042-35718274-6
Fax: 042-35762707
Email: shares@saigols.com
14-K.M. Ferozepur Road, Lahore.
Tel: 042-35920151-9 (9 Lines)
34-K.M. Ferozepur Road, Keath Village, Lahore.
Tel: 042-35935151-2
Kohinoor Building, 25-West Wharf Road, Karachi.
Tel: 021-32200951-4
Fax: 021-32310303
Room # 301, 3rd Floor, Green Trust Tower, Blue Area, Islamabad.
Tel: 051-2824543, 2828941
Fax: 051-2273858
206, No. 1007, Zhong Shan Naun Er Road, Shanghai, China.
Tel: 86-21-64567713
Fax: 86-21-54109971
Nine month ended up to Rupees in thousandsSeptember 30, 2015 September 30, 2014
Increase /(Decrease)
Sales
Gross Profit
Profit before tax
Profit after tax
Earnings per share - Rupees
21,956,250
6,119,251
3,170,490
2,660,427
6.60
18,507,755
4,839,566
1,931,982
1,614,204
4.52
3,448,495
1,279,685
1,238,508
1,046,223
02 03
Dear Shareholders
Your directors are pleased to present the un-audited interim financial information of the Company for the nine months period ended September 30, 2015. The Company has registered positive sales growth of 18.63% as compared to the corresponding period of last year. In absolute terms, sales revenue was reported at Rs. 21.956 billion against Rs.18.508 billion of the corresponding period of last year. The company continued to make center of its efforts on disciplined cost management which resulted in gross profit expansion to Rs.1.280 billion. The positive improvement in the gross margin has trickled down to the bottom line resulting in enhanced net profit after tax & Earnings per share. Profit after tax achieved is Rs. 2.660 billion against Rs.1.614 billion of the respective period of last year, showing a growth of 64.81 %. EPS achieved is Rs. 6.60 as compared to Rs. 4.52 of corresponding period of last year showing a growth of 46.02%.
Summarized results are as below:
During the period under review, overall economy of the country has illustrated a growing trend. In the wake of the energy crisis, and the need for investment in distribution network besides generation, the present government is expected to remain steadfast in providing a feasible market business atmosphere in the country.
The Company continued to surpass its previous records in the nine months ended September 30, 2015 against comparative volume of previous corresponding period. Appliances Division has achieved sales of Rs 12.762 billion against sale of Rs.10.572 billion of corresponding period of last year. Robust marketing and advertising strategies, persistent cost cutting focus and major R & D initiatives have been the main drivers of consistent growth in appliances division. Sales have also grown up for deep freezers and split ACs. PEL Deep Freezer is well received among the corporate customers as well as at domestic level. Customization according to the requirement of the corporate customer is the Strength of PEL. By following international standards & Protocols, Product Quality and Strong After sales Service, PEL has created strong Good will with Customers Like Unilever (Walls), Engro Foods (O'more), Pakistan Dairies (Igloo) and PEPSI etc. PEL split A.C is well received in market due to its durability, quality, brand equity and after sales services backup. To sum up, there has been a moderate growth of home appliances products produced by the company during this period.
Power Division sales have witnessed a decent growth against the prior period, primarily on the back of higher number of sales orders from WAPDA and EPC division. Sales achieved during the period are Rs. 9.194 billion i.e. 16 % higher as compared to the corresponding period of previous year. The Company's strategic focus to cater the demand pertaining to expansion requirement & strengthening of distribution network and infrastructure in the country is main driver of the volumetric growth in orders. This has also enabled the Company to secure a market leading position in the production of Distribution Transformer, Power Transformer, Switch Gear and as an EPC Contractor.
In the wake of the above-mentioned factors, the Company aims to operate at its optimal efficiency to achieve further growth by employing working capital management, cost containment measures and improved processes.
APPLIANCES DIVISION
POWER DIVISION
DIRECTORS’ REVIEW
CONDENSED INTERIM
CONSOLIDATED FINANCIAL INFORMATION
M. MURAD SAIGOL
Chief Executive Officer
on behalf of the Board of Directors
LahoreOctober 27, 2015
04
FUTURE OUTLOOK
The macroeconomic outlook looks positive for Pakistan with electricity self-sufficiency being one of the top priorities for the present Government. There are a lot of untapped market opportunities for PEL.On the appliances front, the company has built its brand equity in the past years out of which the company is likely to continue to derive monetary benefits in the form of higher revenue generation in the future.
Prevailing market statistics and PEL's strategic market presence depict national and international opportunities to focus during the fourth quarter of the year, primarily in the power division. The adoption of underground electrification throughout the country, augmentation of Transmission and Distribution sector and export opportunities will enable us to continue the upward trajectory in financial and operational growth of the company and economy as a whole.
We take this opportunity to thank all our stakeholders for their patronage and look forward to their continued support.
DIRECTORS’ REVIEW
CONDENSED INTERIM
CONSOLIDATED FINANCIAL INFORMATION
M. MURAD SAIGOL
Chief Executive Officer
on behalf of the Board of Directors
LahoreOctober 27, 2015
04
FUTURE OUTLOOK
The macroeconomic outlook looks positive for Pakistan with electricity self-sufficiency being one of the top priorities for the present Government. There are a lot of untapped market opportunities for PEL.On the appliances front, the company has built its brand equity in the past years out of which the company is likely to continue to derive monetary benefits in the form of higher revenue generation in the future.
Prevailing market statistics and PEL's strategic market presence depict national and international opportunities to focus during the fourth quarter of the year, primarily in the power division. The adoption of underground electrification throughout the country, augmentation of Transmission and Distribution sector and export opportunities will enable us to continue the upward trajectory in financial and operational growth of the company and economy as a whole.
We take this opportunity to thank all our stakeholders for their patronage and look forward to their continued support.
CONDENSED INTERIM
CONSOLIDATED BALANCE SHEET
AS AT SEPTEMBER 30, 2015
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
06 07
(Un-Audited) (Audited)
September 302015
December 312014Rupees in thousands
Note
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorized Capital 4
Issued, subscribed and paid up capital 5
Reserves
Unappropriated profit
SURPLUS ON REVALUATION
NON-CURRENT LIABILITIES
Redeemable Capital 6
Long-term financing 7
Liabilities against assets subject to finance lease 8
Deferred taxation
Deferred income
CURRENT LIABILITIES
Trade and other payables
Interest/ mark-up accrued on loans and payables
Short-term borrowings 9
Current Portion of Non Current Liabilities:
Long term loans
Liabilities against assets subject finance lease
Contingencies and Commitments 10
6,000,000
4,431,029
1,293,858
8,118,008
13,842,895
4,412,331
4,061,112
1,809,163
96,876
2,012,183
43,465
891,526
485,619
4,848,986
2,054,765
72,996
8,353,892
-
34,631,917
6,000,000
4,431,029
1,293,858
5,301,554
11,026,441
4,568,357
4,826,469
2,442,807
74,715
2,394,344
45,158
881,429
500,528
4,243,261
1,462,760
60,395
7,148,373
-
32,526,664
(Un-Audited) (Audited)
September 302015
December 312014Rupees in thousands
Note
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 11
Intangible assets
Long-term investments 12
Long-term deposits
CURRENT ASSETS
Stores, spare parts and loose tools
Stock-in-trade
Trade debts
Advances
Trade deposits and short-term prepayments
Other receivables
Other financial assets
Income tax refundable
Cash and bank balances
14,096,816
340,397
14,437,213
75,163
188,191
491,047
7,648,338
8,861,982
1,346,626
991,573
185,542
19,354
11,140
375,749
19,931,350
34,631,917
14,466,890
344,008
14,810,898
63,890
192,808
462,140
6,316,868
7,702,272
1,256,100
853,209
187,730
21,596
319,067
340,086
17,459,068
32,526,664
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
Pak Elektron Limited | Interim Financial Report September 30, 2015
CONDENSED INTERIM
CONSOLIDATED BALANCE SHEET
AS AT SEPTEMBER 30, 2015
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
06 07
(Un-Audited) (Audited)
September 302015
December 312014Rupees in thousands
Note
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorized Capital 4
Issued, subscribed and paid up capital 5
Reserves
Unappropriated profit
SURPLUS ON REVALUATION
NON-CURRENT LIABILITIES
Redeemable Capital 6
Long-term financing 7
Liabilities against assets subject to finance lease 8
Deferred taxation
Deferred income
CURRENT LIABILITIES
Trade and other payables
Interest/ mark-up accrued on loans and payables
Short-term borrowings 9
Current Portion of Non Current Liabilities:
Long term loans
Liabilities against assets subject finance lease
Contingencies and Commitments 10
6,000,000
4,431,029
1,293,858
8,118,008
13,842,895
4,412,331
4,061,112
1,809,163
96,876
2,012,183
43,465
891,526
485,619
4,848,986
2,054,765
72,996
8,353,892
-
34,631,917
6,000,000
4,431,029
1,293,858
5,301,554
11,026,441
4,568,357
4,826,469
2,442,807
74,715
2,394,344
45,158
881,429
500,528
4,243,261
1,462,760
60,395
7,148,373
-
32,526,664
(Un-Audited) (Audited)
September 302015
December 312014Rupees in thousands
Note
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 11
Intangible assets
Long-term investments 12
Long-term deposits
CURRENT ASSETS
Stores, spare parts and loose tools
Stock-in-trade
Trade debts
Advances
Trade deposits and short-term prepayments
Other receivables
Other financial assets
Income tax refundable
Cash and bank balances
14,096,816
340,397
14,437,213
75,163
188,191
491,047
7,648,338
8,861,982
1,346,626
991,573
185,542
19,354
11,140
375,749
19,931,350
34,631,917
14,466,890
344,008
14,810,898
63,890
192,808
462,140
6,316,868
7,702,272
1,256,100
853,209
187,730
21,596
319,067
340,086
17,459,068
32,526,664
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
Pak Elektron Limited | Interim Financial Report September 30, 2015
1,931,982
1,626,894
3,558,876(2,319,644)
1,239,232
(1,965,743)
(6,199)(170,064)
(2,142,006)
(902,774)
(243,980)
109,797
(50,219)
(44,536)
(228,938)
1,702,386
(61,631)(489,075)
1,151,68019,968
277,804
297,772
(Un-Audited)
September 302015
September 302014Rupees in thousands
21,956,250
3,149,331
18,806,919
12,687,668
6,119,251
25,978
6,145,229
971,678
568,360
109,389
1,321,367
(3,946)
3,170,490
510,062
2,660,427
-
2,660,427
6.60
18,507,755
2,805,571
15,702,184
10,862,618
4,839,566
15,967
4,855,533
913,206
526,396
60,913
1,417,916
(5,120)
1,931,982
317,778
1,614,204
-
1,614,204
4.52
Gross Sales
13
13
Sales Tax and discount
Net Sales
Cost of Sales 14
Gross Profit
Other Operating Income
Distribution Cost
Administrative Cost
Other Operating Expenses
Finance Cost
Share of (loss) / profit of associate
Profit Before Tax
Provision for Taxation
Profit after taxation
Other Comprehensive income
Total the period
Comprehensive income for
Earnings per share - Rupees Basic & diluted 15
September 302014
September 302015
5,846,260
863,9804,982,280
3,539,6841,442,596
9,706
1,452,302
299,336
151,547
23,078
377,400
(1,230)
599,712
66,179
533,532
-
533,532
1.31
5,440,378
823,843
4,616,535
3,242,187
1,374,348
616
1,374,964
287,679
182,666
18,325
382,064
761
504,991
48,829
456,162
-
456,162
1.27
Nine months ended Quarter Ended
September 302014
September 302015
Note
CONDENSED INTERIM
CONSOLIDATED PROFIT AND LOSS ACCOUNT / STATEMENT OF COMPREHENSIVE INCOME
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
Rupees in thousands
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
CONDENSED INTERIM
CONSOLIDATED CASH FLOW STATEMENT
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
08 09
Cash flows from operating activities
Profit before taxation
Adjustments for non cash and other items
Cash generated from operations before working capital changesWorking capital changes
Cash generated from operations
Finance cost paidCompensated absence paidIncome tax paid
Net cash generated / used in operating activities
Cash flows from investing activitiesPurchase of property, plant and equipmentProceeds from disposal of property, plant and equipmentPurchase of other financial assets(Increase) / decrease in long-term deposits
Net cash used in investing activities
Cash flows from financing activitiesIncrease / (Decrease) in Long Term FinancingIncrease/ (Decrease) in liabilities against finance leaseIncrease / (Decrease) in Short Term BorrowingNet cash (used in) / generated from financing activitiesNet increase in cash and cash equivalentsCash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
3,170,490
1,873,159
5,043,649
(3,138,497)
1,905,152
(1,336,276)(9,163)
(178,926)
(1,524,365)
380,787
(222,812)
73,061
-4,617
(145,134)
(806,996)
1,281
605,725
(199,990)35,663
340,086
375,749
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
(Un-Audited)
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
Pak Elektron Limited | Interim Financial Report September 30, 2015
1,931,982
1,626,894
3,558,876(2,319,644)
1,239,232
(1,965,743)
(6,199)(170,064)
(2,142,006)
(902,774)
(243,980)
109,797
(50,219)
(44,536)
(228,938)
1,702,386
(61,631)(489,075)
1,151,68019,968
277,804
297,772
(Un-Audited)
September 302015
September 302014Rupees in thousands
21,956,250
3,149,331
18,806,919
12,687,668
6,119,251
25,978
6,145,229
971,678
568,360
109,389
1,321,367
(3,946)
3,170,490
510,062
2,660,427
-
2,660,427
6.60
18,507,755
2,805,571
15,702,184
10,862,618
4,839,566
15,967
4,855,533
913,206
526,396
60,913
1,417,916
(5,120)
1,931,982
317,778
1,614,204
-
1,614,204
4.52
Gross Sales
13
13
Sales Tax and discount
Net Sales
Cost of Sales 14
Gross Profit
Other Operating Income
Distribution Cost
Administrative Cost
Other Operating Expenses
Finance Cost
Share of (loss) / profit of associate
Profit Before Tax
Provision for Taxation
Profit after taxation
Other Comprehensive income
Total the period
Comprehensive income for
Earnings per share - Rupees Basic & diluted 15
September 302014
September 302015
5,846,260
863,9804,982,280
3,539,6841,442,596
9,706
1,452,302
299,336
151,547
23,078
377,400
(1,230)
599,712
66,179
533,532
-
533,532
1.31
5,440,378
823,843
4,616,535
3,242,187
1,374,348
616
1,374,964
287,679
182,666
18,325
382,064
761
504,991
48,829
456,162
-
456,162
1.27
Nine months ended Quarter Ended
September 302014
September 302015
Note
CONDENSED INTERIM
CONSOLIDATED PROFIT AND LOSS ACCOUNT / STATEMENT OF COMPREHENSIVE INCOME
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
Rupees in thousands
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
CONDENSED INTERIM
CONSOLIDATED CASH FLOW STATEMENT
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
08 09
Cash flows from operating activities
Profit before taxation
Adjustments for non cash and other items
Cash generated from operations before working capital changesWorking capital changes
Cash generated from operations
Finance cost paidCompensated absence paidIncome tax paid
Net cash generated / used in operating activities
Cash flows from investing activitiesPurchase of property, plant and equipmentProceeds from disposal of property, plant and equipmentPurchase of other financial assets(Increase) / decrease in long-term deposits
Net cash used in investing activities
Cash flows from financing activitiesIncrease / (Decrease) in Long Term FinancingIncrease/ (Decrease) in liabilities against finance leaseIncrease / (Decrease) in Short Term BorrowingNet cash (used in) / generated from financing activitiesNet increase in cash and cash equivalentsCash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
3,170,490
1,873,159
5,043,649
(3,138,497)
1,905,152
(1,336,276)(9,163)
(178,926)
(1,524,365)
380,787
(222,812)
73,061
-4,617
(145,134)
(806,996)
1,281
605,725
(199,990)35,663
340,086
375,749
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
(Un-Audited)
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
Pak Elektron Limited | Interim Financial Report September 30, 2015
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
Share capital TotalRupees in thousands
Premium on
issue of shares
Capital reserves Revenue reserves
Unappropriated profit
CONDENSED INTERIM
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
NOTES TO THE CONDENSED INTERIM
CONSOLIDATED FINANCIAL INFORMATION
10 11
Balance as at December 31, 2013 (Audited)
Total comprehensive income for the period
Issue of bonus shares
Incremental depreciation
Balance as at September 30, 2014 (Un-Audited)
Total comprehensive income for the period
Issue of right ordinary shares
Incremental depreciation
Balance as at December 31, 2014 (Audited)
Total comprehensive income for the period.
Incremental depreciation
Balance as at September 30, 2015 (Un-Audited)
3,130,689
-
268,111
-
3,398,800
-
1,032,229
-
4,431,029
-
-
4,431,029
529,740
-
(268,111)
-
261,629
-
1,032,229
-
1,293,858
-
-
1,293,858
2,885,041
1,614,204
159,336
4,658,581
627,265
-
15,708
5,301,554
2,660,427
156,027
8,118,008
6,545,470
1,614,204
--
159,336
8,319,010
627,265
2,064,458
15,708
11,026,441
2,660,427
156,027
13,842,895
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
1 REPORTING ENTITY
2 BASIS OF PREPARATION
The group comprises of the following companies
Parent Company
Pak Elektron Limited ("PEL" or "the Company") was incorporated in Pakistan on March 03, 1956 as a public limited company under the Companies Act, 1913 (replaced by the Companies Ordinance, 1984). Registered office of the Company is situated at 17 - Aziz Avenue, Canal Bank, Gulberg - V, Lahore. PEL is currently listed on all three Stock Exchanges of Pakistan. The principal activity of PEL is manufacturing and sale of electrical capital goods and domestic appliances.
PEL is currently organized into two main operating divisions - Power Division & Appliances Division. PEL's activities are as follows:
Power Division: manufacturing and distribution of transformers, switchgears, energy meters, power transformers, construction of grid stations and equipment procurement and construction (EPC).
Appliances Division: manufacturing, assembling and distribution of refrigerators, air conditioners, deep freezers, microwave ovens and other home appliances.
Subsidiary Company
PEL marketing ( Private ) Limited ( PMPL) was incorporated in Pakistan on August 11, 2011 as a private limited company under the companies ordinance 1984. Registered office of PMPL is situated at 17 Aziz Avenue, canal bank Gulberg V, Lahore. The principal activity of PMPL is sale of electrical capital goods and domestic appliances. PMPL is wholly owned subsidiary of PEL.
This interim consolidated financial information is not audited and has been presented in condensed form and does not include all the information and disclosures as are required to be provided or made in a full set of annual financial statements. This condensed interim consolidated financial information should be read in conjunction with the audited financial statements of the Group for the year ended December 31, 2014.
The comparative interim consolidated balance sheet as at December 31, 2014 and the related notes to the condensed interim consolidated financial information are based on audited financial statements. The comparative interim consolidated profit and loss account/statement of comprehensive income, interim consolidated cash flow statement, interim consolidated statement of changes in equity and related notes to the condensed interim consolidated financial information for the nine months ended September 30, 2014 are based on unaudited interim financial information.
2.1 Statement of compliance
This condensed interim consolidated financial information has been prepared in accordance with the requirements of International Accounting Standard 34 - Interim Financial Reporting, and provisions of and directives issued under the Companies Ordinance, 1984. In case where requirements differ, the provisions of and directives issued under the Companies Ordinance, 1984 have been followed.
Pak Elektron Limited | Interim Financial Report September 30, 2015
The annexed notes from 1 to 18 form an integral part of this condensed interim consolidated financial information.
Share capital TotalRupees in thousands
Premium on
issue of shares
Capital reserves Revenue reserves
Unappropriated profit
CONDENSED INTERIM
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
NOTES TO THE CONDENSED INTERIM
CONSOLIDATED FINANCIAL INFORMATION
10 11
Balance as at December 31, 2013 (Audited)
Total comprehensive income for the period
Issue of bonus shares
Incremental depreciation
Balance as at September 30, 2014 (Un-Audited)
Total comprehensive income for the period
Issue of right ordinary shares
Incremental depreciation
Balance as at December 31, 2014 (Audited)
Total comprehensive income for the period.
Incremental depreciation
Balance as at September 30, 2015 (Un-Audited)
3,130,689
-
268,111
-
3,398,800
-
1,032,229
-
4,431,029
-
-
4,431,029
529,740
-
(268,111)
-
261,629
-
1,032,229
-
1,293,858
-
-
1,293,858
2,885,041
1,614,204
159,336
4,658,581
627,265
-
15,708
5,301,554
2,660,427
156,027
8,118,008
6,545,470
1,614,204
--
159,336
8,319,010
627,265
2,064,458
15,708
11,026,441
2,660,427
156,027
13,842,895
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
1 REPORTING ENTITY
2 BASIS OF PREPARATION
The group comprises of the following companies
Parent Company
Pak Elektron Limited ("PEL" or "the Company") was incorporated in Pakistan on March 03, 1956 as a public limited company under the Companies Act, 1913 (replaced by the Companies Ordinance, 1984). Registered office of the Company is situated at 17 - Aziz Avenue, Canal Bank, Gulberg - V, Lahore. PEL is currently listed on all three Stock Exchanges of Pakistan. The principal activity of PEL is manufacturing and sale of electrical capital goods and domestic appliances.
PEL is currently organized into two main operating divisions - Power Division & Appliances Division. PEL's activities are as follows:
Power Division: manufacturing and distribution of transformers, switchgears, energy meters, power transformers, construction of grid stations and equipment procurement and construction (EPC).
Appliances Division: manufacturing, assembling and distribution of refrigerators, air conditioners, deep freezers, microwave ovens and other home appliances.
Subsidiary Company
PEL marketing ( Private ) Limited ( PMPL) was incorporated in Pakistan on August 11, 2011 as a private limited company under the companies ordinance 1984. Registered office of PMPL is situated at 17 Aziz Avenue, canal bank Gulberg V, Lahore. The principal activity of PMPL is sale of electrical capital goods and domestic appliances. PMPL is wholly owned subsidiary of PEL.
This interim consolidated financial information is not audited and has been presented in condensed form and does not include all the information and disclosures as are required to be provided or made in a full set of annual financial statements. This condensed interim consolidated financial information should be read in conjunction with the audited financial statements of the Group for the year ended December 31, 2014.
The comparative interim consolidated balance sheet as at December 31, 2014 and the related notes to the condensed interim consolidated financial information are based on audited financial statements. The comparative interim consolidated profit and loss account/statement of comprehensive income, interim consolidated cash flow statement, interim consolidated statement of changes in equity and related notes to the condensed interim consolidated financial information for the nine months ended September 30, 2014 are based on unaudited interim financial information.
2.1 Statement of compliance
This condensed interim consolidated financial information has been prepared in accordance with the requirements of International Accounting Standard 34 - Interim Financial Reporting, and provisions of and directives issued under the Companies Ordinance, 1984. In case where requirements differ, the provisions of and directives issued under the Companies Ordinance, 1984 have been followed.
Pak Elektron Limited | Interim Financial Report September 30, 2015
4. AUTHORIZED CAPITAL
500,000,000 500,000,000 5,000,000 5,000,000
62,500,000 62,500,000 625,000 625,000
37,500,000 37,500,000 375,000 375,000
100,000,000 100,000,000 1,000,000 1,000,000
600,000,000 600,000,000 6,000,000 6,000,000
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10/- each
‘A’ class preference shares of Rs. 10 each
‘B’ class preference shares of Rs. 10 each
12 13
2.2 Basis of measurement
This condensed interim consolidated financial information has been prepared under the historical cost convention except for property, plant and equipment at revalued amounts and certain financial instruments at fair value/amortized cost. In this financial information, except for the amounts reflected in the statement of cash flows, all transactions have been accounted for on accrual basis.
2.3 Functional currency
This financial information is prepared in Pak Rupees which is the Group's functional currency.
The accounting policies and the methods of computation adopted in the preparation of this condensed interim financial information are the same as those applied in the preparation of the financial statements for the year ended December 31, 2014.
3 ACCOUNTING POLICIES AND METHODS OF COMPUTATION
6 REDEEMABLE CAPITAL
Long term finances
Short term borrowing
Paid during the period/year
Less : Current maturity
As at beginning of the period/ year
Issued during the period /year against:
2,464,286
2,103,438
1,062,252
3,165,690
-
803,507
5,629,976
-
-
-
425,326
1,143,538
4,061,112 4,826,469 As at end of the period / Year
Debt equity swap transaction agreed between the group and National Bank of Pakistan (NBP) whereby 40 Million ordinary shares were supposed to be issued by the company to redeem the outstanding Privately Placed Term Finance certificate (PPTFC) has been withdrawn. PPTFC shall be redeemed as per the redemption plan mutually agreed between PEL and NBP.
5 ISSUED, SUBSCRIBED AND PAID UP CAPITAL
273,214,754 273,214,754 Issued for cash
Other than cash:
2,732,148
137,500 137,500 - against machinery 1,375
408,273 408,273 - issued on acquisition of PELAppliances Limited 4,083
6,040,820
6,040,820 - issued against conversion of
preference shares 60,408 118,343,841 118,343,841 - as bonus shares 1,183,439
398,145,188 398,145,188 3,981,453
Fully paid A class preference shares ofRs. 10 each
44,957,592 44,957,592 In cash 449,576
443,102,780 443,102,780
2,732,148
1,375
4,083
60,408
1,183,439
3,981,453
449,576
4,431,029 4,431,029
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10 eachfully paid
Pak Elektron Limited | Interim Financial Report September 30, 2015
4. AUTHORIZED CAPITAL
500,000,000 500,000,000 5,000,000 5,000,000
62,500,000 62,500,000 625,000 625,000
37,500,000 37,500,000 375,000 375,000
100,000,000 100,000,000 1,000,000 1,000,000
600,000,000 600,000,000 6,000,000 6,000,000
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10/- each
‘A’ class preference shares of Rs. 10 each
‘B’ class preference shares of Rs. 10 each
12 13
2.2 Basis of measurement
This condensed interim consolidated financial information has been prepared under the historical cost convention except for property, plant and equipment at revalued amounts and certain financial instruments at fair value/amortized cost. In this financial information, except for the amounts reflected in the statement of cash flows, all transactions have been accounted for on accrual basis.
2.3 Functional currency
This financial information is prepared in Pak Rupees which is the Group's functional currency.
The accounting policies and the methods of computation adopted in the preparation of this condensed interim financial information are the same as those applied in the preparation of the financial statements for the year ended December 31, 2014.
3 ACCOUNTING POLICIES AND METHODS OF COMPUTATION
6 REDEEMABLE CAPITAL
Long term finances
Short term borrowing
Paid during the period/year
Less : Current maturity
As at beginning of the period/ year
Issued during the period /year against:
2,464,286
2,103,438
1,062,252
3,165,690
-
803,507
5,629,976
-
-
-
425,326
1,143,538
4,061,112 4,826,469 As at end of the period / Year
Debt equity swap transaction agreed between the group and National Bank of Pakistan (NBP) whereby 40 Million ordinary shares were supposed to be issued by the company to redeem the outstanding Privately Placed Term Finance certificate (PPTFC) has been withdrawn. PPTFC shall be redeemed as per the redemption plan mutually agreed between PEL and NBP.
5 ISSUED, SUBSCRIBED AND PAID UP CAPITAL
273,214,754 273,214,754 Issued for cash
Other than cash:
2,732,148
137,500 137,500 - against machinery 1,375
408,273 408,273 - issued on acquisition of PELAppliances Limited 4,083
6,040,820
6,040,820 - issued against conversion of
preference shares 60,408 118,343,841 118,343,841 - as bonus shares 1,183,439
398,145,188 398,145,188 3,981,453
Fully paid A class preference shares ofRs. 10 each
44,957,592 44,957,592 In cash 449,576
443,102,780 443,102,780
2,732,148
1,375
4,083
60,408
1,183,439
3,981,453
449,576
4,431,029 4,431,029
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10 eachfully paid
Pak Elektron Limited | Interim Financial Report September 30, 2015
11.1.1 Additions during the period / year
Plant and machinery 193,955 330,587
Office equipment and furniture 6,456 3,738
Computer hardware and allied items 16,002 10,912
Vehicles 36,477 58,757
252,890 403,994
14 15
7 LONG-TERM FINANCING - SECURED
3,102,060 3,628,291 Obtained during the period / year 1,562,633 1,850,000
Paid / settled during the period / year 1,944,303
2,376,231
Current portion 911,227
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
659,253
1,809,163
2,442,807
8 LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE
Present value of minimum lease payments 169,872
135,110
Current maturity 72,996
60,395
96,876
74,715
As at beginning of the period/ year
9 SHORT TERM BORROWING
10 CONTINGENCIES AND COMMITMENTS
These facilities have been obtained from various banks under mark-up arrangements for working capital requirements. These facilities are secured against the pledge/hypothecation of raw material and components, work-in-process, finished goods, machinery, spare parts, charge over book debts, shares of public companies and other assets of the company.
There is no material changes in contingencies and commitments as disclosed in the notes to the financial statements for the year ended December 31, 2014.
11 PROPERTY, PLANT AND EQUIPMENT
Operating assets 11.1 14,033,670
14,407,147
Capital work-in-progress 63,146
59,743
14,096,816
14,466,890
11.1 Operating assets
Written down value at beginning of the period / year 14,407,147
14,764,490
Additions during the period / year 11.1.1 252,890 403,994
14,660,037 15,168,484
Written down value of the assets disposed off / adjustments
Depreciation charged during the period / year
73,061 10,109
553,306 751,228
14,033,670 14,407,147
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
Note
55,740 -
-
50,219
5,598
5,521
SILK BANK LIMITED- un quoted
17,698,489 preference shares of Rs. 2.5 each
As at beginning of the period/year
Acquired during the period/year
Amortization for the period/year
As at end of the period/year 61,338
55,740
12 LONG-TERM INVESTMENTS
13,825 8,150
Other Investments 61,338 55,740
75,163 63,890
Kohinoor Power Company Limited
Ownership interest % 23.10 23.10
54,701
54,701
8,183
12,129
62,884
66,830
Cost of investment
2,910,600 shares (December 31, 2014: 2,910,600 shares)
Share of post acquisition profit- net of dividend received
Less: provision for impairment in value of investment 49,059
58,680
13,825
8,150
Investment in related parties - Quoted
Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited)
Note
Pak Elektron Limited | Interim Financial Report September 30, 2015
12.1
12.1
12.2
12.2
11.1.1 Additions during the period / year
Plant and machinery 193,955 330,587
Office equipment and furniture 6,456 3,738
Computer hardware and allied items 16,002 10,912
Vehicles 36,477 58,757
252,890 403,994
14 15
7 LONG-TERM FINANCING - SECURED
3,102,060 3,628,291 Obtained during the period / year 1,562,633 1,850,000
Paid / settled during the period / year 1,944,303
2,376,231
Current portion 911,227
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
659,253
1,809,163
2,442,807
8 LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE
Present value of minimum lease payments 169,872
135,110
Current maturity 72,996
60,395
96,876
74,715
As at beginning of the period/ year
9 SHORT TERM BORROWING
10 CONTINGENCIES AND COMMITMENTS
These facilities have been obtained from various banks under mark-up arrangements for working capital requirements. These facilities are secured against the pledge/hypothecation of raw material and components, work-in-process, finished goods, machinery, spare parts, charge over book debts, shares of public companies and other assets of the company.
There is no material changes in contingencies and commitments as disclosed in the notes to the financial statements for the year ended December 31, 2014.
11 PROPERTY, PLANT AND EQUIPMENT
Operating assets 11.1 14,033,670
14,407,147
Capital work-in-progress 63,146
59,743
14,096,816
14,466,890
11.1 Operating assets
Written down value at beginning of the period / year 14,407,147
14,764,490
Additions during the period / year 11.1.1 252,890 403,994
14,660,037 15,168,484
Written down value of the assets disposed off / adjustments
Depreciation charged during the period / year
73,061 10,109
553,306 751,228
14,033,670 14,407,147
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
Note
55,740 -
-
50,219
5,598
5,521
SILK BANK LIMITED- un quoted
17,698,489 preference shares of Rs. 2.5 each
As at beginning of the period/year
Acquired during the period/year
Amortization for the period/year
As at end of the period/year 61,338
55,740
12 LONG-TERM INVESTMENTS
13,825 8,150
Other Investments 61,338 55,740
75,163 63,890
Kohinoor Power Company Limited
Ownership interest % 23.10 23.10
54,701
54,701
8,183
12,129
62,884
66,830
Cost of investment
2,910,600 shares (December 31, 2014: 2,910,600 shares)
Share of post acquisition profit- net of dividend received
Less: provision for impairment in value of investment 49,059
58,680
13,825
8,150
Investment in related parties - Quoted
Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited)
Note
Pak Elektron Limited | Interim Financial Report September 30, 2015
12.1
12.1
12.2
12.2
1716
13 REVENUE
Sales - local 19,967,034
18,167,298
4,241,468
5,370,157
Sales - export 1,989,216
340,457
1,604,792
70,221
21,956,250
18,507,755
5,846,260
5,440,378
Less: - sales tax and excise duty 2,501,317
1,985,693
644,757
685,484
- trade discounts 648,014
819,878
219,223
138,359
3,149,331
2,805,571
863,980
823,843
18,806,919
15,702,184
4,982,280
4,616,535
14 COST OF SALES
Raw material consumed 10,146,993
8,889,578
2,109,790
2,491,970
Direct wages 479,880
465,903
168,754
163,839
Factory overhead 1,386,611
1,343,628
441,614
439,703
12,013,484
10,699,109
2,720,158
3,095,512
Work-in-process
-at beginning of period 1,262,830
1,043,870
1,017,814
908,450
-at end of period (719,142)
(688,310)
(719,142)
(688,310)
543,688
355,560
298,672
220,140
Cost of goods manufactured 12,557,171 11,054,669 3,018,830 3,315,652
Finished goods
-at beginning of period 877,488 385,437 1,267,846 504,023
-at end of period (746,992) (577,488) (746,992) (577,488)
130,496 (192,051) 520,854 (73,465)
Cost of sales 12,687,668 10,862,618 3,539,684 3,242,187
Rupees in thousands
September 30
2015
(Un-audited)
September 30
2015
(Un-audited)
Nine months ended Quarter Ended
September 30
2014
(Un-audited)
September 30
2014
(Un-audited)
15
Earnings 2,660,427 1,614,204
Less: dividend on preference shares 32,032 32,032
2,628,395 1,582,172
Number of shares
398,145,188
349,840,423
349,840,423
398,145,188
Basic Profit per share (Rupees) 6.60
Weighted average number of ordinary shares.
EARNINGS PER SHARE - BASIC AND DILUTED
(Number)
Rupees in thousands
September 30
2015
(Un-audited)
Six months ended
September 30
2014
(Un-audited)
Basic and diluted Profit per share have been calculated through dividing Profit as stated above by weighted average number of ordinary shares.
4.52
32,846
1,894
Other related parties:
130,658
Key Management Personnel Short-term employee benefits
Post employment benefits
Associated companies Services acquired
Relationship Nature of transaction
16 TRANSACTIONS WITH RELATED PARTIES
Related parties from the Group's perspective comprise associated companies, post employment benefit plans and key management personnel. Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, and includes the Chief Executive and Directors of the Company.
Transactions with key management personnel are limited to payment of short term employee benefits only. The Group in the normal course of business carries out various transactions with other related parties and continues to have a policy whereby all such transactions are carried out on commercial terms and conditions which are equivalent to those prevailing in an arm's length transaction.
Details of transactions with related parties are as follows:
Rupees in thousands
September 302015
September 302014
(Un-audited)
(Un-audited)
30,542
1,634
107,047
16.1 All transactions with related parties have been carried out on commercial terms and conditions.
Pak Elektron Limited | Interim Financial Report September 30, 2015
1716
13 REVENUE
Sales - local 19,967,034
18,167,298
4,241,468
5,370,157
Sales - export 1,989,216
340,457
1,604,792
70,221
21,956,250
18,507,755
5,846,260
5,440,378
Less: - sales tax and excise duty 2,501,317
1,985,693
644,757
685,484
- trade discounts 648,014
819,878
219,223
138,359
3,149,331
2,805,571
863,980
823,843
18,806,919
15,702,184
4,982,280
4,616,535
14 COST OF SALES
Raw material consumed 10,146,993
8,889,578
2,109,790
2,491,970
Direct wages 479,880
465,903
168,754
163,839
Factory overhead 1,386,611
1,343,628
441,614
439,703
12,013,484
10,699,109
2,720,158
3,095,512
Work-in-process
-at beginning of period 1,262,830
1,043,870
1,017,814
908,450
-at end of period (719,142)
(688,310)
(719,142)
(688,310)
543,688
355,560
298,672
220,140
Cost of goods manufactured 12,557,171 11,054,669 3,018,830 3,315,652
Finished goods
-at beginning of period 877,488 385,437 1,267,846 504,023
-at end of period (746,992) (577,488) (746,992) (577,488)
130,496 (192,051) 520,854 (73,465)
Cost of sales 12,687,668 10,862,618 3,539,684 3,242,187
Rupees in thousands
September 30
2015
(Un-audited)
September 30
2015
(Un-audited)
Nine months ended Quarter Ended
September 30
2014
(Un-audited)
September 30
2014
(Un-audited)
15
Earnings 2,660,427 1,614,204
Less: dividend on preference shares 32,032 32,032
2,628,395 1,582,172
Number of shares
398,145,188
349,840,423
349,840,423
398,145,188
Basic Profit per share (Rupees) 6.60
Weighted average number of ordinary shares.
EARNINGS PER SHARE - BASIC AND DILUTED
(Number)
Rupees in thousands
September 30
2015
(Un-audited)
Six months ended
September 30
2014
(Un-audited)
Basic and diluted Profit per share have been calculated through dividing Profit as stated above by weighted average number of ordinary shares.
4.52
32,846
1,894
Other related parties:
130,658
Key Management Personnel Short-term employee benefits
Post employment benefits
Associated companies Services acquired
Relationship Nature of transaction
16 TRANSACTIONS WITH RELATED PARTIES
Related parties from the Group's perspective comprise associated companies, post employment benefit plans and key management personnel. Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, and includes the Chief Executive and Directors of the Company.
Transactions with key management personnel are limited to payment of short term employee benefits only. The Group in the normal course of business carries out various transactions with other related parties and continues to have a policy whereby all such transactions are carried out on commercial terms and conditions which are equivalent to those prevailing in an arm's length transaction.
Details of transactions with related parties are as follows:
Rupees in thousands
September 302015
September 302014
(Un-audited)
(Un-audited)
30,542
1,634
107,047
16.1 All transactions with related parties have been carried out on commercial terms and conditions.
Pak Elektron Limited | Interim Financial Report September 30, 2015
CONDENSED INTERIM
FINANCIAL INFORMATION
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
18
17 DATE OF AUTHORIZATION FOR ISSUE
18 OTHERS
This condensed interim financial information has been approved by the Board of Directors of the Company and authorized for issue on October 27, 2015.
There are no other significant activities since December 31, 2014 affecting this condensed interim financial information.
CONDENSED INTERIM
FINANCIAL INFORMATION
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
18
17 DATE OF AUTHORIZATION FOR ISSUE
18 OTHERS
This condensed interim financial information has been approved by the Board of Directors of the Company and authorized for issue on October 27, 2015.
There are no other significant activities since December 31, 2014 affecting this condensed interim financial information.
HAROON A. KHANDirector
21
CONDENSED INTERIM
BALANCE SHEET
AS AT SEPTEMBER 30, 2015
M. MURAD SAIGOLChief Executive Officer
Rupees in thousandsNote
(Un-Audited) (Audited)
September 302015
December 312014 Rupees in thousands
Note
(Un-Audited) (Audited)
September 302015
December 312014
20
4
5
6
7
8
9
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorized Capital
Issued, subscribed and paid up capital
Reserves
Unappropriated profit
SURPLUS ON REVALUATION
NON-CURRENT LIABILITIES
Redeemable Capital
Long-term financing
Liabilities against assets subject to finance lease
Deferred taxation
Deferred income
CURRENT LIABILITIES
Trade and other payables
Interest/ mark-up accrued on loans and payables
Short-term borrowings
Current Portion of Non Current Liabilities:
Long term loans
Liabilities against assets subject finance lease
CONTIGENCIES AND COMMITMENTS 10
6,000,000
4,431,029
1,293,858
5,157,369
10,882,256
4,412,331
4,061,112
1,809,163
96,876
1,666,778
43,465
822,942
485,619
4,848,986
2,054,765
72,996
8,285,308
-
31,257,289
6,000,000
4,431,029
1,293,858
3,876,195
9,601,082
4,568,357
4,826,469
2,442,807
74,715
2,048,938
45,158
817,486
500,528
4,240,947
1,462,760
60,395
7,082,116
-
30,689,642
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 11 14,096,816 14,466,890
Intangible assets 340,397 344,008
14,437,213 14,810,898
Long-term investments 12 75,263 63,990
Long-term deposits 188,191 192,808
CURRENT ASSETS
Stores, spare parts and loose tools 491,047 462,140
Stock-in-trade 7,058,928 6,140,170
Trade debts 5,770,947 6,025,103
Advances 1,346,626 1,256,100
Trade deposits and short-term prepayments 991,573 853,209
Other receivables 185,543 187,730
Other financial assets 19,354 21,596
Income tax refundable 367,165 387,963
Cash and bank balances 325,440 287,935
16,556,623 15,621,946
31,257,289 30,689,642
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
Pak Elektron Limited | Interim Financial Report September 30, 2015
HAROON A. KHANDirector
21
CONDENSED INTERIM
BALANCE SHEET
AS AT SEPTEMBER 30, 2015
M. MURAD SAIGOLChief Executive Officer
Rupees in thousandsNote
(Un-Audited) (Audited)
September 302015
December 312014 Rupees in thousands
Note
(Un-Audited) (Audited)
September 302015
December 312014
20
4
5
6
7
8
9
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Authorized Capital
Issued, subscribed and paid up capital
Reserves
Unappropriated profit
SURPLUS ON REVALUATION
NON-CURRENT LIABILITIES
Redeemable Capital
Long-term financing
Liabilities against assets subject to finance lease
Deferred taxation
Deferred income
CURRENT LIABILITIES
Trade and other payables
Interest/ mark-up accrued on loans and payables
Short-term borrowings
Current Portion of Non Current Liabilities:
Long term loans
Liabilities against assets subject finance lease
CONTIGENCIES AND COMMITMENTS 10
6,000,000
4,431,029
1,293,858
5,157,369
10,882,256
4,412,331
4,061,112
1,809,163
96,876
1,666,778
43,465
822,942
485,619
4,848,986
2,054,765
72,996
8,285,308
-
31,257,289
6,000,000
4,431,029
1,293,858
3,876,195
9,601,082
4,568,357
4,826,469
2,442,807
74,715
2,048,938
45,158
817,486
500,528
4,240,947
1,462,760
60,395
7,082,116
-
30,689,642
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 11 14,096,816 14,466,890
Intangible assets 340,397 344,008
14,437,213 14,810,898
Long-term investments 12 75,263 63,990
Long-term deposits 188,191 192,808
CURRENT ASSETS
Stores, spare parts and loose tools 491,047 462,140
Stock-in-trade 7,058,928 6,140,170
Trade debts 5,770,947 6,025,103
Advances 1,346,626 1,256,100
Trade deposits and short-term prepayments 991,573 853,209
Other receivables 185,543 187,730
Other financial assets 19,354 21,596
Income tax refundable 367,165 387,963
Cash and bank balances 325,440 287,935
16,556,623 15,621,946
31,257,289 30,689,642
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
Pak Elektron Limited | Interim Financial Report September 30, 2015
CONDENSED INTERIM
CASH FLOW STATEMENT
September 302015Rupees in thousands
23
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
CONDENSED INTERIM
PROFIT AND LOSS ACCOUNT / STATEMENT OF COMPREHENSIVE INCOME
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
22
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
Gross Sales 13
16,132,326
13,991,401
Sales Tax and discount 13
2,501,317
2,126,693
Net Sales 13,631,009
11,864,708
Cost of Sales 14
10,683,985
9,494,139
Gross Profit 2,947,024
2,370,569
Other Operating Income 16,357
11,865
2,963,381
2,382,434
Distribution Cost 269,894
249,159
Administrative Cost 338,049
320,347
Other Operating Expenses 109,389
61,931
Finance Cost 896,920
949,177
Profit Before Taxation 1,349,129 801,820
Provision for Taxation 223,981
206,384
Profit For the year after Taxation 1,125,148 595,436
Other Comprehensive Income -
-
Total Comprehensive Income for the Period 1,125,148 595,436
Earnings per share Basic & diluted 15
2.75
1.61
3,718,763
644,757
3,074,006
2,362,955
711,051
3,848
714,899
62,977
102,628
23,078
306,784
219,432
20,155
199,277
-
199,277
0.47
4,473,032
826,484
3,646,548
2,829,212
817,336
3,646
820,982
97,945
137,904
18,091
332,815
234,227
89,787
144,440
-
144,440
0.38
Note
September 30 September 30
2015 2014
Nine months ended Quarter Ended
Rupees in thousand
September 30 September 30
2015 2014
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
Cash flows from operating activities
Profit before taxation
Adjustments for non cash items
Cash generated from operations before working capital changes
Working capital changes
Cash generated from operations
Finance cost paid
Compensated absence paid
Income tax paid
Net cash generated from / (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Purchase of other financial assets
(Increase) / decrease in long-term deposits
Net cash used in investing activities
Cash flows from financing activities
Increase / (Decrease) in Long Term Financing
Increase/ (Decrease) in liabilities against finance lease
Increase / (Decrease) in Short Term Borrowing
Net cash from (used in) granted from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
1,349,129
1,446,793
2,795,922
(1,317,608) 1,478,314
(911,829)
(7,243)
(178,927)
(1,097,999)
380,315
(222,812)
73,061
-
4,617
(145,134)
(806,996)
1,281
608,039
(197,676)
37,505
287,935
325,440
September 302014
801,820
1,516,594
2,318,414
(1,233,110) 1,085,304
(1,855,443)
(6,198)
(170,064)
(2,031,705)
(946,401)
(243,980)
109,797
(50,219)
(44,536)
(228,938)
1,702,386
(61,632)
(476,967)
1,163,787
(11,552)
259,488
247,936
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
(Un-Audited) (Un-Audited)
Pak Elektron Limited | Interim Financial Report September 30, 2015
CONDENSED INTERIM
CASH FLOW STATEMENT
September 302015Rupees in thousands
23
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
CONDENSED INTERIM
PROFIT AND LOSS ACCOUNT / STATEMENT OF COMPREHENSIVE INCOME
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
22
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
Gross Sales 13
16,132,326
13,991,401
Sales Tax and discount 13
2,501,317
2,126,693
Net Sales 13,631,009
11,864,708
Cost of Sales 14
10,683,985
9,494,139
Gross Profit 2,947,024
2,370,569
Other Operating Income 16,357
11,865
2,963,381
2,382,434
Distribution Cost 269,894
249,159
Administrative Cost 338,049
320,347
Other Operating Expenses 109,389
61,931
Finance Cost 896,920
949,177
Profit Before Taxation 1,349,129 801,820
Provision for Taxation 223,981
206,384
Profit For the year after Taxation 1,125,148 595,436
Other Comprehensive Income -
-
Total Comprehensive Income for the Period 1,125,148 595,436
Earnings per share Basic & diluted 15
2.75
1.61
3,718,763
644,757
3,074,006
2,362,955
711,051
3,848
714,899
62,977
102,628
23,078
306,784
219,432
20,155
199,277
-
199,277
0.47
4,473,032
826,484
3,646,548
2,829,212
817,336
3,646
820,982
97,945
137,904
18,091
332,815
234,227
89,787
144,440
-
144,440
0.38
Note
September 30 September 30
2015 2014
Nine months ended Quarter Ended
Rupees in thousand
September 30 September 30
2015 2014
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
Cash flows from operating activities
Profit before taxation
Adjustments for non cash items
Cash generated from operations before working capital changes
Working capital changes
Cash generated from operations
Finance cost paid
Compensated absence paid
Income tax paid
Net cash generated from / (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Purchase of other financial assets
(Increase) / decrease in long-term deposits
Net cash used in investing activities
Cash flows from financing activities
Increase / (Decrease) in Long Term Financing
Increase/ (Decrease) in liabilities against finance lease
Increase / (Decrease) in Short Term Borrowing
Net cash from (used in) granted from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
1,349,129
1,446,793
2,795,922
(1,317,608) 1,478,314
(911,829)
(7,243)
(178,927)
(1,097,999)
380,315
(222,812)
73,061
-
4,617
(145,134)
(806,996)
1,281
608,039
(197,676)
37,505
287,935
325,440
September 302014
801,820
1,516,594
2,318,414
(1,233,110) 1,085,304
(1,855,443)
(6,198)
(170,064)
(2,031,705)
(946,401)
(243,980)
109,797
(50,219)
(44,536)
(228,938)
1,702,386
(61,632)
(476,967)
1,163,787
(11,552)
259,488
247,936
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
(Un-Audited) (Un-Audited)
Pak Elektron Limited | Interim Financial Report September 30, 2015
NOTES TO THE CONDENSED INTERIM
FINANCIAL INFORMATION
25
Balance as at December 31, 2013 (Audited)
Total comprehensive income for the period
Issue of bonus shares
Incremental depreciation
Balance as at September 30, 2014 (Un-Audited)
Total comprehensive income for the period
Issue of right ordinary shares
Incremental depreciation
Balance as at December 31, 2014 (Audited)
Total comprehensive income for the period.
Incremental depreciation
Balance as at September 30, 2015 (Un-Audited)
3,130,689
-
268,111
-
3,398,800
-
1,032,229
-
4,431,029
-
-
4,431,029
529,740
-
(268,111)
-
261,629
-
1,032,229
-
1,293,858
-
-
1,293,858
2,473,853
595,436
159,336
3,228,625
631,862
-
15,708
3,876,195
1,125,148
156,026
5,157,369
6,134,282
595,436
-
159,336
6,889,054
631,862
2,064,458
15,708
9,601,082
1,125,148
156,026
10,882,256
CONDENSED INTERIM
STATEMENT OF CHANGES IN EQUITY
Share capital TotalRupees in thousands
Premium on
issue of shares
Capital reserves Revenue reserves
Unappropriated profit
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
24
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
1 REPORTING ENTITY
2 BASIS OF PREPARATION
Pak Elektron Limited ("PEL" or "the Company") was incorporated in Pakistan on March 03, 1956 as a public limited company under the Companies Act, 1913 (replaced by the Companies Ordinance, 1984). Registered office of the Company is situated at 17 - Aziz Avenue, Canal Bank, Gulberg - V, Lahore. The Company is currently listed on all three Stock Exchanges of Pakistan. The principal activity of the Company is manufacturing and sale of electrical capital goods and domestic appliances.
The Company is currently organized into two main operating divisions - Power Division & Appliances Division. The Company's activities are as follows:
Power Division: manufacturing and distribution of transformers, switchgears, energy meters, power transformers, construction of grid stations and equipment procurement and construction (EPC).
Appliances Division: manufacturing, assembling and distribution of refrigerators, air conditioners, microwave ovens and other home appliances.
This interim financial information is not audited and has been presented in condensed form and does not include all the information and disclosures as are required to be provided or made in a full set of annual financial statements. This condensed interim financial information should be read in conjunction with the audited financial statements of the company for the year ended December 31, 2014.
The comparative interim balance sheet as at December 31, 2014 and the related notes to the condensed interim financial information are based on audited financial statements. The comparative interim profit and loss account/statement of comprehensive income, interim cash flow statement, interim statement of changes in equity and related notes to the condensed interim financial information for the nine months ended September 30, 2014 are based on unaudited interim financial information.
2.1 Statement of compliance
This condensed interim financial information has been prepared in accordance with the requirements of International Accounting Standard 34 - Interim Financial Reporting, and provisions of and directives issued under the Companies Ordinance, 1984. In case where requirements differ, the provisions of and directives issued under the Companies Ordinance, 1984 have been followed.
2.2 Basis of measurement
This condensed interim financial information has been prepared under the historical cost convention except for property, plant and equipment at revalued amounts and certain financial instruments at fair value/amortized cost. In this financial information, except for the amounts reflected in the statement of cash flows, all transactions have been accounted for on accrual basis.
Pak Elektron Limited | Interim Financial Report September 30, 2015
-
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
NOTES TO THE CONDENSED INTERIM
FINANCIAL INFORMATION
25
Balance as at December 31, 2013 (Audited)
Total comprehensive income for the period
Issue of bonus shares
Incremental depreciation
Balance as at September 30, 2014 (Un-Audited)
Total comprehensive income for the period
Issue of right ordinary shares
Incremental depreciation
Balance as at December 31, 2014 (Audited)
Total comprehensive income for the period.
Incremental depreciation
Balance as at September 30, 2015 (Un-Audited)
3,130,689
-
268,111
-
3,398,800
-
1,032,229
-
4,431,029
-
-
4,431,029
529,740
-
(268,111)
-
261,629
-
1,032,229
-
1,293,858
-
-
1,293,858
2,473,853
595,436
159,336
3,228,625
631,862
-
15,708
3,876,195
1,125,148
156,026
5,157,369
6,134,282
595,436
-
159,336
6,889,054
631,862
2,064,458
15,708
9,601,082
1,125,148
156,026
10,882,256
CONDENSED INTERIM
STATEMENT OF CHANGES IN EQUITY
Share capital TotalRupees in thousands
Premium on
issue of shares
Capital reserves Revenue reserves
Unappropriated profit
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
24
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2015 (Un-Audited)
1 REPORTING ENTITY
2 BASIS OF PREPARATION
Pak Elektron Limited ("PEL" or "the Company") was incorporated in Pakistan on March 03, 1956 as a public limited company under the Companies Act, 1913 (replaced by the Companies Ordinance, 1984). Registered office of the Company is situated at 17 - Aziz Avenue, Canal Bank, Gulberg - V, Lahore. The Company is currently listed on all three Stock Exchanges of Pakistan. The principal activity of the Company is manufacturing and sale of electrical capital goods and domestic appliances.
The Company is currently organized into two main operating divisions - Power Division & Appliances Division. The Company's activities are as follows:
Power Division: manufacturing and distribution of transformers, switchgears, energy meters, power transformers, construction of grid stations and equipment procurement and construction (EPC).
Appliances Division: manufacturing, assembling and distribution of refrigerators, air conditioners, microwave ovens and other home appliances.
This interim financial information is not audited and has been presented in condensed form and does not include all the information and disclosures as are required to be provided or made in a full set of annual financial statements. This condensed interim financial information should be read in conjunction with the audited financial statements of the company for the year ended December 31, 2014.
The comparative interim balance sheet as at December 31, 2014 and the related notes to the condensed interim financial information are based on audited financial statements. The comparative interim profit and loss account/statement of comprehensive income, interim cash flow statement, interim statement of changes in equity and related notes to the condensed interim financial information for the nine months ended September 30, 2014 are based on unaudited interim financial information.
2.1 Statement of compliance
This condensed interim financial information has been prepared in accordance with the requirements of International Accounting Standard 34 - Interim Financial Reporting, and provisions of and directives issued under the Companies Ordinance, 1984. In case where requirements differ, the provisions of and directives issued under the Companies Ordinance, 1984 have been followed.
2.2 Basis of measurement
This condensed interim financial information has been prepared under the historical cost convention except for property, plant and equipment at revalued amounts and certain financial instruments at fair value/amortized cost. In this financial information, except for the amounts reflected in the statement of cash flows, all transactions have been accounted for on accrual basis.
Pak Elektron Limited | Interim Financial Report September 30, 2015
-
The annexed notes from 1 to 18 form an integral part of this condensed interim financial information.
27
Debt equity swap transaction agreed between the company and National Bank of Pakistan (NBP) whereby 40 Million ordinary shares were supposed to be issued by the company to redeem the outstanding Privately Placed Term Finance certificate (PPTFC) has been withdrawn. PPTFC shall be redeemed as per the redemption plan mutually agreed between PEL and NBP.
26
2.3 Functional currency
This financial information is prepared in Pak Rupees which is the Company's functional currency.
The accounting policies and the methods of computation adopted in the preparation of this condensed interim financial information are the same as those applied in the preparation of the financial statements for the year ended December 31, 2014.
3 ACCOUNTING POLICIES
4. AUTHORIZED CAPITAL
500,000,000 500,000,000 5,000,000 5,000,000
62,500,000 62,500,000 625,000 625,000
37,500,000 37,500,000 375,000 375,000
100,000,000 100,000,000 1,000,000 1,000,000
600,000,000 600,000,000 6,000,000 6,000,000
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10/- each
‘A’ class preference shares of Rs. 10 each
‘B’ class preference shares of Rs. 10 each
5 ISSUED, SUBSCRIBED AND PAID UP CAPITAL
273,214,754 273,214,754 Issued for cash
Other than cash:
2,732,148
137,500 137,500 - against machinery 1,375
408,273 408,273 - issued on acquisition of PELAppliances Limited 4,083
6,040,820
6,040,820 - issued against conversion of
preference shares 60,408 118,343,841 118,343,841 - as bonus shares 1,183,439
398,145,188 398,145,188 3,981,453
Fully paid A class preference shares ofRs. 10 each
44,957,592 44,957,592 In cash 449,576
443,102,780 443,102,780
2,732,148
1,375
4,083
60,408
1,183,439
3,981,453
449,576
4,431,029 4,431,029
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10 eachfully paid
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
6 REDEEMABLE CAPITAL
Long term finances
Short term borrowing
Paid during the period/year
Current maturity
As at beginning of the period/ year
Issued during the period /year against:
2,464,286
2,103,438
1,062,252
3,165,690
-
803,507
5,629,976
-
-
-
425,326
1,143,538
4,061,112 4,826,469 As at end of the period / Year
7 LONG-TERM FINANCING - SECURED
3,102,060 3,628,291 Obtained during the period / year 1,562,633 1,850,000 Paid / settled during the period / year 1,944,303
2,376,231
Current portion 911,227 659,253
1,809,163
2,442,807
8 LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE
Present value of minimum lease payments 169,872
135,110
Current maturity 72,996
60,395
96,876
74,715
As at beginning of the period/ year
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
9 SHORT TERM BORROWINGS
These facilities have been obtained from various banks under mark-up arrangements for working capital requirements. These facilities are secured against the pledge/hypothecation of raw material and components, work-in-process, finished goods, machinery, spare parts, charge over book debts, shares of public companies and other assets of the company.
Pak Elektron Limited | Interim Financial Report September 30, 2015
27
Debt equity swap transaction agreed between the company and National Bank of Pakistan (NBP) whereby 40 Million ordinary shares were supposed to be issued by the company to redeem the outstanding Privately Placed Term Finance certificate (PPTFC) has been withdrawn. PPTFC shall be redeemed as per the redemption plan mutually agreed between PEL and NBP.
26
2.3 Functional currency
This financial information is prepared in Pak Rupees which is the Company's functional currency.
The accounting policies and the methods of computation adopted in the preparation of this condensed interim financial information are the same as those applied in the preparation of the financial statements for the year ended December 31, 2014.
3 ACCOUNTING POLICIES
4. AUTHORIZED CAPITAL
500,000,000 500,000,000 5,000,000 5,000,000
62,500,000 62,500,000 625,000 625,000
37,500,000 37,500,000 375,000 375,000
100,000,000 100,000,000 1,000,000 1,000,000
600,000,000 600,000,000 6,000,000 6,000,000
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10/- each
‘A’ class preference shares of Rs. 10 each
‘B’ class preference shares of Rs. 10 each
5 ISSUED, SUBSCRIBED AND PAID UP CAPITAL
273,214,754 273,214,754 Issued for cash
Other than cash:
2,732,148
137,500 137,500 - against machinery 1,375
408,273 408,273 - issued on acquisition of PELAppliances Limited 4,083
6,040,820
6,040,820 - issued against conversion of
preference shares 60,408 118,343,841 118,343,841 - as bonus shares 1,183,439
398,145,188 398,145,188 3,981,453
Fully paid A class preference shares ofRs. 10 each
44,957,592 44,957,592 In cash 449,576
443,102,780 443,102,780
2,732,148
1,375
4,083
60,408
1,183,439
3,981,453
449,576
4,431,029 4,431,029
September 302015
December 312014
Number of shares Rupees in thousands
September 302015
December 312014
(Un-audited) (Audited) (Audited)(Un-audited)
Ordinary shares of Rs. 10 eachfully paid
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
6 REDEEMABLE CAPITAL
Long term finances
Short term borrowing
Paid during the period/year
Current maturity
As at beginning of the period/ year
Issued during the period /year against:
2,464,286
2,103,438
1,062,252
3,165,690
-
803,507
5,629,976
-
-
-
425,326
1,143,538
4,061,112 4,826,469 As at end of the period / Year
7 LONG-TERM FINANCING - SECURED
3,102,060 3,628,291 Obtained during the period / year 1,562,633 1,850,000 Paid / settled during the period / year 1,944,303
2,376,231
Current portion 911,227 659,253
1,809,163
2,442,807
8 LIABILITIES AGAINST ASSETS SUBJECT TO FINANCE LEASE
Present value of minimum lease payments 169,872
135,110
Current maturity 72,996
60,395
96,876
74,715
As at beginning of the period/ year
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
9 SHORT TERM BORROWINGS
These facilities have been obtained from various banks under mark-up arrangements for working capital requirements. These facilities are secured against the pledge/hypothecation of raw material and components, work-in-process, finished goods, machinery, spare parts, charge over book debts, shares of public companies and other assets of the company.
Pak Elektron Limited | Interim Financial Report September 30, 2015
2928
10 CONTINGENCIES AND COMMITMENTS
There is no material changes in contingencies and commitments as disclosed in the notes to the financial statements for the year ended December 31, 2014.
11 PROPERTY, PLANT AND EQUIPMENT
Operating assets 11.1 14,033,670
14,407,147
Capital work-in-progress 63,146
59,743
14,096,816
14,466,890
11.1 Operating assets
Written down value at beginning of the period / year 14,407,147
14,764,490
Additions during the period / year 11.1.1 252,890 403,994
14,660,037 15,168,484
Written down value of the assets disposed off / adjustments 73,061 10,109
Depreciation charged during the period / year 553,306 751,228
14,033,670 14,407,147
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
Note
11.1.1 Additions during the period / year
Plant and machinery 193,955 330,587
Office equipment and furniture 6,456 3,738
Computer hardware and allied items 16,002 10,912
Vehicles 36,477 58,757
252,890 403,994
12 LONG-TERM INVESTMENTS
100 100
12.1
12.2
13,825 8,150
Investments in related parties
Wholly owned subsidiary - Unquoted
Pel Marketing Private Limited
10,000 shares (December 31, 2014: 10,000 shares) of Rs. 10 eachOwnership interest: ordinary shares held 100% (December 31, 2014: 100%)
Associate - Quoted
SILK Bank Limited - Un Quoted 61,338 55,740
75,263 63,990
12.1
12.2
Kohinoor Power Company Limited
Ownership interest % 23.10 23.10
Cost of investment
2,910,600 shares (December 31, 2014: 2,910,600 shares) 54,701
54,701
Less: provision for impairment in value of investment 40,876
46,551
13,825
8,150
SILK BANK LIMITED
17,698,489 preferemce shares of Rs. 2.5 each
As at begining of the period/year 55,740
-
Acquired during the period/year -
50219
Amortization for the period/year 5598 5521
As at end of the year 61,338
55,740
Investment in associate at cost - Quoted
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
13 REVENUE
Sales - local 14,143,110
13,650,944
2,113,971
4,402,811
Sales - export 1,989,216
340,457
1,604,792
70,221
16,132,326
13,991,401
3,718,763
4,473,032
Less: - sales tax and excise duty 2,501,317
2,501,317
2,126,693
2,126,693
644,757
644,757
826,484
- trade discounts - - - -
826,484
13,631,009 11,864,708 3,074,006 3,646,548
Rupees in thousands
September 30
2015
(Un-audited)
September 30
2015
(Un-audited)
Nine months ended Quarter Ended
September 30
2014
(Un-audited)
September 30
2014
(Un-audited)
Pak Elektron Limited | Interim Financial Report September 30, 2015
2928
10 CONTINGENCIES AND COMMITMENTS
There is no material changes in contingencies and commitments as disclosed in the notes to the financial statements for the year ended December 31, 2014.
11 PROPERTY, PLANT AND EQUIPMENT
Operating assets 11.1 14,033,670
14,407,147
Capital work-in-progress 63,146
59,743
14,096,816
14,466,890
11.1 Operating assets
Written down value at beginning of the period / year 14,407,147
14,764,490
Additions during the period / year 11.1.1 252,890 403,994
14,660,037 15,168,484
Written down value of the assets disposed off / adjustments 73,061 10,109
Depreciation charged during the period / year 553,306 751,228
14,033,670 14,407,147
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
Note
11.1.1 Additions during the period / year
Plant and machinery 193,955 330,587
Office equipment and furniture 6,456 3,738
Computer hardware and allied items 16,002 10,912
Vehicles 36,477 58,757
252,890 403,994
12 LONG-TERM INVESTMENTS
100 100
12.1
12.2
13,825 8,150
Investments in related parties
Wholly owned subsidiary - Unquoted
Pel Marketing Private Limited
10,000 shares (December 31, 2014: 10,000 shares) of Rs. 10 eachOwnership interest: ordinary shares held 100% (December 31, 2014: 100%)
Associate - Quoted
SILK Bank Limited - Un Quoted 61,338 55,740
75,263 63,990
12.1
12.2
Kohinoor Power Company Limited
Ownership interest % 23.10 23.10
Cost of investment
2,910,600 shares (December 31, 2014: 2,910,600 shares) 54,701
54,701
Less: provision for impairment in value of investment 40,876
46,551
13,825
8,150
SILK BANK LIMITED
17,698,489 preferemce shares of Rs. 2.5 each
As at begining of the period/year 55,740
-
Acquired during the period/year -
50219
Amortization for the period/year 5598 5521
As at end of the year 61,338
55,740
Investment in associate at cost - Quoted
Rupees in thousandsSeptember 30
2015December 31
2014
(Un-audited) (Audited)
13 REVENUE
Sales - local 14,143,110
13,650,944
2,113,971
4,402,811
Sales - export 1,989,216
340,457
1,604,792
70,221
16,132,326
13,991,401
3,718,763
4,473,032
Less: - sales tax and excise duty 2,501,317
2,501,317
2,126,693
2,126,693
644,757
644,757
826,484
- trade discounts - - - -
826,484
13,631,009 11,864,708 3,074,006 3,646,548
Rupees in thousands
September 30
2015
(Un-audited)
September 30
2015
(Un-audited)
Nine months ended Quarter Ended
September 30
2014
(Un-audited)
September 30
2014
(Un-audited)
Pak Elektron Limited | Interim Financial Report September 30, 2015
31
15 EARNINGS PER SHARE - BASIC AND DILUTED
Rupees in thousands
September 30
2015
(Un-audited)
Six months ended
September 30
2014
(Un-audited)
30
Rupees in thousands
September 30
2015
(Un-audited)
September 30
2015
(Un-audited)
Nine months ended Quarter Ended
September 30
2014
(Un-audited)
September 30
2014
(Un-audited)
14 COST OF SALES
Raw material consumed 7,738,632
7,451,094
1,115,518
2,042,761
Direct wages 479,880
465,903
168,754
163,839
Factory overhead 1,386,610
1,343,628
441,614
439,703
9,605,122
9,260,625
1,725,886
2,646,302
Work-in-process
-at beginning of period 1,262,830
1,043,870
1,017,814
908,450
-at end of period (719,142)
(688,310)
(719,142)
(688,310)
543,688
355,560
298,672
220,140
Cost of goods manufactured 10,148,810 9,616,185 2,024,558 2,866,442
Finished goods
-at beginning of period 700,790 278,744 504,012 363,560
-at end of period (165,616) (400,790) (165,616) (400,790)
535,174 (122,046) 338,396 (37,230)
Cost of sales 10,683,984 9,494,139 2,362,954 2,829,212
The calculation of basic and diluted profit per ordinary share isbased on the following data:
Profits for the period 1,125,148
595,436
Less: dividend payable on preference shares 32,032
32,032
Profit attributable to ordinary shares 1,093,116
563,404
Number of shares
398,145,188
349,840,423
349,840,423398,145,188
(Number)Weighted average number of ordinary shares
outstanding during the period
Basic and diluted profit per share have been calculated through dividing profit as stated above by weighted average number of ordinary shares.
Rupees in thousands
September 30
2015
(Un-audited)
Six months ended
September 30
2014
(Un-audited)
Basic and Diluted Earnings per share (Rupees) 2.75
1.61
Pak Elektron Limited | Interim Financial Report September 30, 2015
Relationship Nature of transaction
16 TRANSACTIONS WITH RELATED PARTIES
plans and key management personnel. Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, and includes the Chief Executive and Directors of the Company.
Transactions with key management personnel are limited to payment of short term employee benefits only. The company in the normal course of business carries out various transactions with other related parties and continues to have a policy whereby all such transactions are carried out on commercial terms and conditions which are equivalent to those prevailing in an arm's length transaction.
Details of transactions with related parties are as follows:
Related parties from the company's perspective comprise associated companies, post employment benefit
Rupees in thousands
September 302015
September 302014
(Un-audited)
(Un-audited)
Subsidiary:
8,790,548 7,218,123
-
32,846 30,542
1,894 1,634
Other related parties:
130,658 107,047
Sales of services
PEL Marketing Private Limited Sales of goods and services
Key Management Personnel Short-term employee
Post employment benefits
Red Communication Art Private
Limited
Purchase of services
-
17 DATE OF AUTHORIZATION FOR ISSUE
This condensed interim financial information has been approved by the Board of Directors of the Company and authorized for issue on October 27, 2015.
31
15 EARNINGS PER SHARE - BASIC AND DILUTED
Rupees in thousands
September 30
2015
(Un-audited)
Six months ended
September 30
2014
(Un-audited)
30
Rupees in thousands
September 30
2015
(Un-audited)
September 30
2015
(Un-audited)
Nine months ended Quarter Ended
September 30
2014
(Un-audited)
September 30
2014
(Un-audited)
14 COST OF SALES
Raw material consumed 7,738,632
7,451,094
1,115,518
2,042,761
Direct wages 479,880
465,903
168,754
163,839
Factory overhead 1,386,610
1,343,628
441,614
439,703
9,605,122
9,260,625
1,725,886
2,646,302
Work-in-process
-at beginning of period 1,262,830
1,043,870
1,017,814
908,450
-at end of period (719,142)
(688,310)
(719,142)
(688,310)
543,688
355,560
298,672
220,140
Cost of goods manufactured 10,148,810 9,616,185 2,024,558 2,866,442
Finished goods
-at beginning of period 700,790 278,744 504,012 363,560
-at end of period (165,616) (400,790) (165,616) (400,790)
535,174 (122,046) 338,396 (37,230)
Cost of sales 10,683,984 9,494,139 2,362,954 2,829,212
The calculation of basic and diluted profit per ordinary share isbased on the following data:
Profits for the period 1,125,148
595,436
Less: dividend payable on preference shares 32,032
32,032
Profit attributable to ordinary shares 1,093,116
563,404
Number of shares
398,145,188
349,840,423
349,840,423398,145,188
(Number)Weighted average number of ordinary shares
outstanding during the period
Basic and diluted profit per share have been calculated through dividing profit as stated above by weighted average number of ordinary shares.
Rupees in thousands
September 30
2015
(Un-audited)
Six months ended
September 30
2014
(Un-audited)
Basic and Diluted Earnings per share (Rupees) 2.75
1.61
Pak Elektron Limited | Interim Financial Report September 30, 2015
Relationship Nature of transaction
16 TRANSACTIONS WITH RELATED PARTIES
plans and key management personnel. Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, and includes the Chief Executive and Directors of the Company.
Transactions with key management personnel are limited to payment of short term employee benefits only. The company in the normal course of business carries out various transactions with other related parties and continues to have a policy whereby all such transactions are carried out on commercial terms and conditions which are equivalent to those prevailing in an arm's length transaction.
Details of transactions with related parties are as follows:
Related parties from the company's perspective comprise associated companies, post employment benefit
Rupees in thousands
September 302015
September 302014
(Un-audited)
(Un-audited)
Subsidiary:
8,790,548 7,218,123
-
32,846 30,542
1,894 1,634
Other related parties:
130,658 107,047
Sales of services
PEL Marketing Private Limited Sales of goods and services
Key Management Personnel Short-term employee
Post employment benefits
Red Communication Art Private
Limited
Purchase of services
-
17 DATE OF AUTHORIZATION FOR ISSUE
This condensed interim financial information has been approved by the Board of Directors of the Company and authorized for issue on October 27, 2015.
18 OTHERS
There are no other significant activities since December 31, 2014 affecting this condensed interim financial information.
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
17-Aziz Avenue, Canal Bank, Gulberg-V, Lahore.Ph: (042) 35718274-5, 35717364-5
www.pel.com.pk
32
18 OTHERS
There are no other significant activities since December 31, 2014 affecting this condensed interim financial information.
M. MURAD SAIGOLChief Executive Officer
HAROON A. KHANDirector
17-Aziz Avenue, Canal Bank, Gulberg-V, Lahore.Ph: (042) 35718274-5, 35717364-5
www.pel.com.pk
32
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