quarterly september, 2017 - · pdf filefaysal bank limited habib bank limted habib...

Registered Office:4th Floor, The Forum, Suite No. 416-422G-20, Block No. 9, Clifton,Khayaban-e-Jami, Karachi-75600, Pakistan.Tel: 92 21-3587 4047-49, 3583 1618 Fax: 92 21-3586 0251

www.tripack.com.pk QuarterlyReportSeptember, 2017

02 Company Information

03 Directors’ Review

04 Condensed Interim Balance Sheet (Un-audited)

05 Condensed Interim Profit and Loss Account (Un-audited)

06 Condensed Interim Cash Flow Statement (Un-audited)

07 Condensed Interim Statement of Changes in Equity (Un-audited)

08 Notes to and forming part of the Condensed Interim Financial Information (Un-audited)

14 Directors’ Review (Urdu Version)

Contents

BOARD OF DIRECTORS Syed Babar Ali (Chairman) Syed Hyder Ali* Kimihide Ando Khurram Raza BakhtayariYukio Hayasawa Syed Aslam MehdiAsif Qadir

CHIEF EXECUTIVE OFFICERNasir Jamal

AUDIT COMMITTEE Asif Qadir (Chairman)Kimihide Ando* Khurram Raza BakhtayariYukio Hayasawa

EXECUTIVE COMMITTEEKimihide Ando (Chairman) Syed Hyder Ali* Khurram Raza Bakhtayari Syed Aslam Mehdi

HUMAN RESOURCE ANDREMUNERATION COMMITTEEAsif Qadir (Chairman)Kimihide Ando* Khurram Raza Bakhtayari Syed Aslam Mehdi

HEAD OF FINANCEShafiq Afzal Khan

COMPANY SECRETARYAdi J. Cawasji

AUDITORS AND TAX ADVISORA. F. Ferguson & Co. Chartered Accountants

LEGAL ADVISORSSattar & Sattar Khan & Piracha

SHARES REGISTRAR FAMCO Associates (Pvt.) Ltd, 8-F,Next to Hotel Faran, Nursery, Block 6,P.E.C.H.S., Shahrah-e-Faisal,Karachi - 75400 Tel : (021) 34380101-2 Fax : (021) 34380106

WEBSITEwww.tripack.com.pk

REGISTERED OFFICE4th Floor, The Forum, Suite No. 416-422,G-20, Block No. 9, Clifton, Khayaban-e-Jami,Karachi - 75600, Pakistan. Tel: (021) 35874047-49, 35831618Fax: (021) 35860251

BANKERSAl-Baraka Bank (Pakistan) LimitedAllied Bank Limted Askari Bank Limited Bank Alfalah Limited Bank AL Habib LimitedBankIslami Pakistan LimitedDeutsche Bank AG Dubai Islamic Bank (Pakistan) LimitedFaysal Bank Limited Habib Bank LimtedHabib Metropolitan Bank LimitedMCB Bank LimitedMeezan Bank LimitedStandard Chartered Bank (Pakistan) LimitedThe Bank of Tokyo - Mitsubishi UFJ, LimitedUnited Bank Limited

REGIONAL SALES & HEAD OFFICE House No. 18, Sir Abdullah Haroon Road,Near Marriott Hotel, Karachi. Tel: (021) 35224336-37Fax: (021) 35224338

WORKS Plot No. G-1 to G-4,North Western Industrial Zone,Port Qasim Authority, Karachi. Tel : (021) 34720247-48Fax : (021) 34720245

WORKS & REGIONAL SALES OFFICE Plot No. 78/1, Phase IV,Hattar Industrial Estate, Hattar,Khyber Pakhtunkhwa. Tel: (0995) 617406-7Fax: (0995) 617054

REGIONAL SALES OFFICE Plot No. 5 FC. C, Maratib Ali Road,Gulberg II, Lahore.Tel: (042) 35716068-70Fax: (042) 35716071

* In alphabetical order by last name

Company Information

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Nine months period ended September 30

Nasir JamalChief Executive Officer Karachi, October 18, 2017

Directors’ ReviewThe Directors are pleased to present their review report together with the un-audited condensed interim financial information on the Company for the nine months ended September 30, 2017.

Compliance with Safety, Health and Environmental (SHE) requirements remained a priority during this period.

2017 2016Sales volume (Metric tonnes) 37,890 36,830Revenue (Rs million) 9,012 8,782Profit before tax (Rs million) 676 845Profit after tax (Rs million) 460 710Earnings per share (Rs) 11.87 19.19

Overall volumes during the nine months period were higher by 3% compared to same period last year on the back of high off take in domestic market. Exports remained low due to unattractive margin on account of low regional prices and continued supply overhang. Net revenue was higher by 3% compared to same period last year primarily on the back of high volumes.

Feedstock prices were higher by 11% compared to same period last year and supplies remained stable throughout the period. Despite the rise in feedstock prices, the prices of films in the region did not increase in the same proportion primarily due to supply overhang. The same situation was experienced in domestic market and as a result gross margins were lower compared to corresponding period last year. Administrative expenses were lower by 1% compared to same period last year whereas distribution expenses were higher by 14% in line with increased fuel prices and higher domestic volumes. Finance cost was lower by 31% despite a hit of Rs 34 million on account of exchange loss due to volatility of Pak Rupee against major currencies.

Profit before tax for the nine months ended was 20% lower at Rs 676 million against corresponding period last year. Profit after tax for the nine months ended was Rs 460 million compared to Rs 710 million in the corresponding period last year. Tax charge includes provision for super tax for the tax year 2017.

Future OutlookMarket is expected to maintain its growth momentum. We will endeavor to improve the performance of the Company. Pressure on value of Pak Rupee against major currencies is expected to increase going forward, which may impact pro�tability.

We remain grateful to all our stakeholders for their continued support.

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For the nine months period ended September 30, 2017

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ASSETS NON CURRENT ASSETS

Property, plant and equipment 4 6,140,032 6,346,761 Intangibles 4,643 2,897 Long term deposits 4,499 3,358 6,149,174 6,353,016 CURRENT ASSETS

Stores and spares 402,537 408,767 Stock-in-trade 1,321,152 1,380,062 Trade debts - net 1,633,677 1,508,480 Advances and prepayments 76,479 98,761 Refunds due from the government - sales tax 32,877 - Other receivables 95,598 119,261 Income tax - net 1,023,519 1,099,992 Cash and bank balances 132,562 176,741 4,718,401 4,792,064

TOTAL ASSETS 10,867,575 11,145,080

EQUITY AND LIABILITIESSHARE CAPITAL AND RESERVES Share capital 388,000 388,000 Share premium 999,107 999,107 Revenue reserves 2,486,149 2,413,711 3,873,256 3,800,818

LIABILITIES

NON CURRENT LIABILITIES Long term finances 1,790,893 2,544,408 Deferred taxation 264,511 185,146 Accumulated compensated absences 26,170 32,875 2,081,574 2,762,429 CURRENT LIABILITIES Trade and other payables 5 2,370,198 2,900,505 Accrued mark-up 53,541 49,019 Short term borrowings 6 1,368,622 511,925 Current maturity of long term finances 1,120,384 1,120,384 4,912,745 4,581,833TOTAL LIABILITIES 6,994,319 7,344,262 CONTINGENCIES AND COMMITMENTS 7TOTAL EQUITY AND LIABILITIES 10,867,575 11,145,080

The annexed notes 1 to 16 form an integral part of this condensed interim financial information.

(Un-audited)September 30

(Rupees in thousand)

2017 2016Note

(Audited)December 31

As at September 30, 2017Condensed Interim Balance Sheet

Chief Executive O�cerNasir Jamal

Chief Financial O�cerShafiq Afzal Khan

DirectorAsif Qadir

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DirectorAsif Qadir

For the quarter and nine months period ended September 30, 2017 - (unaudited)Condensed Interim Profit and Loss Account

Revenue 8 2,950,064 2,999,933 9,011,779 8,782,408

Cost of sales (2,561,295) (2,522,082) (7,609,226) (7,123,040)

Gross profit 388,769 477,851 1,402,553 1,659,368

Distribution costs (60,767) (70,605) (230,451) (202,879)

Administrative expenses (60,402) (81,014) (226,029) (228,749)

(121,169) (151,619) (456,480) (431,628)

Operating profit 267,600 326,232 946,073 1,227,740

Other income 12,145 23,726 30,733 50,293

279,745 349,958 976,806 1,278,033

Other expenses (8,805) (16,401) (46,072) (62,728)

Finance cost (97,689) (112,763) (255,009) (369,952)

(106,494) (129,164) (301,081) (432,680)

Profit before income tax 173,251 220,794 675,725 845,353

Income tax 10 (48,422) (39,527) (215,287) (135,433)

Profit for the period 124,829 181,267 460,438 709,920

Earnings per share - basic and

diluted (Rupees) 11 3.22 4.67 11.87 19.19

There are no other comprehensive income items during this period.

The annexed notes 1 to 16 form an integral part of this condensed interim financial information.

Nine months period ended September 30Quarter ended September 30


2017 20162017 2016Note

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Cash flows from operating activities Cash generated from operations 13 867,513 899,177 Payment on account of accumulated compensated absences (11,205) (4,392)Increase in long term deposits (1,141) (31)Staff retirement benefits paid (81,586) (42,778)Income taxes (paid)/refund (59,449) 36,210 Net cash generated from operating activities 714,132 888,186

Cash flows from investing activities Purchase of property, plant and equipment (256,984) (82,485)Purchase of intangible assets (8,380) (2,593)Profit received on bank balances 641 237 Sale proceeds on disposal of operating fixed assets 6,115 8,868 Net cash used in investing activities (258,608) (75,973)

Cash flows from financing activities Proceeds from rights issue - net of issuance cost - 1,087,107 Dividend paid (386,412) (148,124)Long term finances paid (753,515) (583,515)Short term financing - net 750,000 (800,000)Finance cost paid (216,473) (381,070)Net cash used in financing activities (606,400) (825,602)Net decrease in cash and cash equivalents (150,876) (13,389)Cash and cash equivalents at the beginning of the period 64,816 (104,864)Cash and cash equivalents at the end of the period 14 (86,060) (118,253) The annexed notes 1 to 16 form an integral part of this condensed interim financial information.



DirectorAsif Qadir

For the nine months period ended September 30, 2017 - (unaudited)Condensed Interim Cash Flow Statement


2017 2016NoteNine months period ended September 30

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DirectorAsif Qadir

For the nine months period ended September 30, 2017 - (unaudited)Condensed Interim Statement of Changes in Equity


Capital Revenue

ReservesIssued,

subscribed and paid up share capital

Unappro-priatedprofit

Share premium

General reserve

Total reserves

Total

Balance as at January 1, 2016 300,000 - 1,605,000 208,802 1,813,802 2,113,802

Issue of rights shares at premium 88,000 1,012,000 - - 1,012,000 1,100,000

Issuance cost of rights issue - (12,893) - - (12,893) (12,893) Final cash dividend for the year ended December 31, 2015 @ Rs 5.00 per share - - - (150,000) (150,000) (150,000) Total comprehensive income for the nine months period ended September 30, 2016

- Profit for the nine months period ended September 30, 2016 - - - 709,920 709,920 709,920 - Other comprehensive income for the nine months period ended September 30, 2016 - - - - - - - - - 709,920 709,920 709,920

Balance as at September 30, 2016 388,000 999,107 1,605,000 768,722 3,372,829 3,760,829 Balance as at January 1, 2017 388,000 999,107 1,605,000 808,711 3,412,818 3,800,818 Final cash dividend for the year ended December 31, 2016 @ Rs 10.00 per share - - - (388,000) (388,000) (388,000) Total comprehensive income for the nine months period ended September 30, 2017 - Profit for the nine months period ended September 30, 2017 - - - 460,438 460,438 460,438 - Other comprehensive income for the nine months period ended September 30, 2017 - - - - - - - - - 460,438 460,438 460,438 Balance as at September 30, 2017 388,000 999,107 1,605,000 881,149 3,485,256 3,873,256 The annexed notes 1 to 16 form an integral part of this condensed interim financial information.

Notes to and forming part of the Condensed InterimFinancial InformationFor the nine months period ended September 30, 2017 - (unaudited)

1. THE COMPANY AND ITS OPERATIONS

Tri-Pack Films Limited (the Company) was incorporated in Pakistan as a public company on April 29, 1993 under the Companies Ordinance, 1984 (the Ordinance) and is listed on the Pakistan Stock Exchange. It is principally engaged in the manufacturing and sale of Biaxially Oriented Polypropylene (BOPP) film and Cast Polypropylene (CPP) film. The registered office of the Company is situated at 4th floor, the Forum, Suite No. 416 to 422, G-20, Block-9, Khayaban-e-Jami, Clifton, Karachi.

2. BASIS OF PREPARATION This condensed interim financial information of the Company for the nine months period

ended September 30, 2017 has been prepared in accordance with the requirements of the International Accounting Standard 34 - "Interim Financial Reporting" and provisions of and directives issued under the Ordinance. In case where requirements differ, the provisions of or directives issued under the Ordinance have been followed.

This condensed interim financial information does not include all the information required for full financial statements and should be read in conjunction with the annual financial statements of the Company as at and for the year ended December 31, 2016.

The accounting policies and methods of computation adopted for the preparation of this condensed interim financial information are the same as those applied in the preparation of the annual financial statements of the Company for the year ended December 31, 2016.

Further, contractual borrowings are not part of cash and cash equivalents and are part of financing activities.

During the period, Companies Act, 2017 (the Act) has been enacted on May 30, 2017. However, as required by circular CLD/CCD/PR(11)/2017 dated October 4, 2017 issued by the Securities and Exchange Commission of Pakistan (SECP), this condensed interim financial information of the Company for the nine months ended September 30, 2017 has been prepared in accordance with the provisions of and directives issued under the Ordinance.

2.1 Changes in accounting standards, interpretations and pronouncements

Standards, interpretations and amendments to published approved accounting standards that are effective and relevant

IAS 7, 'Cashflow statements' - This amendment requires disclosure to explain changes in liabilities for which cashflows have been, or will be classified as financing activities in the statement of cashflows. The amendment is part of the IASB’s Disclosure Initiative. In the first

year of adoption, comparative information need not be provided.

3. ACCOUNTING ESTIMATES, JUDGEMENTS AND FINANCIAL RISK MANAGEMENT

The preparation of this condensed interim financial information requires management to make estimates, assumptions and use judgements that affect the application of policies and reported amounts of assets and liabilities and income and expenses. Estimates, assumptions

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and judgements are continually evaluated and are based on historical experience and other factors, including reasonable expectations of future events. Revisions to accounting estimates are recognised prospectively commencing from the period of revision.

Judgements and estimates made by the management in the preparation of this condensed

interim financial information are the same as those that were applied to financial statements as at and for the year ended December 31, 2016.

The Company's financial risk management objectives and policies are consistent with those disclosed in the financial statements as at and for the year ended December 31, 2016.

4. PROPERTY, PLANT AND EQUIPMENT

Operating assets 4.1 6,027,162 6,239,151 Capital work in progress 92,776 79,692 Major spare parts and stand-by equipment 20,094 27,918 6,140,032 6,346,761 4.1 Additions to and disposals from operating assets and major spare parts during the period are as

follows:

Lease hold land 2,427 - - - Building and other civil work on leasehold land 23,736 - - - Plant and machinery 207,864 87,942 - - Furniture and fixtures 9,622 3,281 69 1,096 Office and other equipment 8,075 2,461 - 155 Vehicles - - 5,566 6,203 Major spare parts and stand - by equipment 1,450 1,450 9,274 13,940 253,174 95,134 14,909 21,394

5. TRADE AND OTHER PAYABLES 5.1 This includes Rs Nil (December 31, 2016: Rs 597.61 million) in relation to letters of credit under

supplier financing arrangement. 5.2 This includes provision in respect of Gas Infrastructure Development Cess (GIDC) amounting to

Rs 582 million (December 31, 2016: Rs 452.96 million) which has not been paid due to stay order obtained by the Company in the Honourable High Courts of Sindh and Peshawar against demand and collection under GIDC Act 2015.

5.3 This includes amount in respect of cess for special maintenance and development of

infrastructure levied under the Sindh Finance Act, 1994 amounting to Rs 75.1 million (December 31, 2016: Rs 45.26 million) which has not been paid due to stay order obtained by

the Company in the Honourable High Court of Sindh.

Additions/Transfers from CWIP (at cost)

Disposals / Transfers(at net book value)

September 302017

September 302016


September 302017

September 302016

Note 20162017(Rupees in thousand)



Nine months period endedNine months period ended

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6. SHORT TERM BORROWINGS Secured Short term running finance 6.1 218,622 111,925 Short term money market loans 6.2 1,150,000 400,000 1,368,622 511,925

6.1 Short-term running finances have been obtained under mark-up arrangements from commercial banks payable on various maturity dates up to August 21, 2018. These facilities are secured by joint hypothecation by way of first floating charge over current assets including but not limited to stores and spares, stock in trade and trade debts. Rate of mark-up applicable to these facilities ranges between 6.09% to 6.80% (2016: 6.09% to 6.94%)

6.2 Short-term money market loans have been arranged as a sub-limit of the running finance facility.

Rate of mark-up applicable to these facilities ranges between 6.08% to 6.57% (2016: 6.06% to 6.69%) per annum. These facilities are available for the maximum period of one year from the date of agreement with the latest facility expiring on August 21, 2018.

6.3 Total facilities available under mark-up arrangements aggregated Rs 8.65 billion (December 31, 2016: Rs 8.65 billion) out of which the amount unavailed at the period end was

Rs 7.28 billion (December 31, 2016: Rs 8.14 billion).

7. CONTINGENCIES AND COMMITMENTS Contingencies

Guarantees issued by banks on behalf of the Company 354,605 329,605

Commitments - for purchase of raw materials and spares 546,407 471,000 - for capital expenditure 294,657 183,481

7.1 Aggregate commitments in respect of Ijarah arrangements of motor vehicles amounted to Rs 18.39 million (December 31, 2016: Rs 20.38 million.) 7.2 The facilities for opening of letter of credit and for guarantees as at September 30, 2017 amount

to Rs 11.5 billion (December 31, 2016: Rs 11.5 billion) and Rs 570 million (December 31, 2016: Rs 395 million) respectively, of which the amount remaining unutilised was Rs 9.57 billion

(December 31, 2016: Rs 9.69 million) and Rs 215.4 million (December 31, 2016: Rs 65.4 million) respectively.

7.3 There has been no change in the status of contingencies reported in the financial statements for

the year ended December 31, 2016.

20162017(Rupees in thousand)






Note

8. REVENUE

Sale of goods less returns: - Local 3,486,674 3,528,502 10,651,757 10,318,009

Less: Sales tax (505,146) (515,964) (1,546,860) (1,515,122) Discounts (90,134) (76,815) (253,217) (206,493) 2,891,394 2,935,723 8,851,680 8,596,394 - Export 58,670 64,210 160,099 186,014 2,950,064 2,999,933 9,011,779 8,782,408

9. RECLASSIFICATION

For better presentation, comparative information on certain administrative expenses have been reclassified to cost of sales and distribution costs.

10. TAXATION 10.1 Income tax expense is recognised based on management's estimate of the weighted average effective annual income tax rate expected for the full financial year. 10.2 This includes prior year charge for super tax amounting to Rs 26.3 million (September 30, 2016:

Nil) imposed for rehabilitation of temporarily displaced persons under section 4B of the Income Tax Ordinance, 2001.

11. EARNINGS PER SHARE- BASIC AND DILUTED Profit attributable to ordinary

shareholders 124,829 181,267 460,438 709,920

Weighted average number of ordinary shares outstanding at the

end of the period 38,800 38,800 38,800 36,991 Earnings per share - basic and diluted (Rupees) 3.22 4.67 11.87 19.19 11.1 There were no convertible dilutive potential ordinary shares outstanding on September 30, 2017

and 2016. 12. TRANSACTIONS WITH RELATED PARTIES The related parties comprise related group companies, companies in which directors are

interested, staff retirement benefit funds, directors, key management personnel and close members of the family of all the aforementioned related parties. The Company in the normal course of business carries out transactions with various related parties.

2017 2016(Rupees in thousand)

2017 2016

2017 2016(Rupees in thousand)

2017 2016

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(Un-audited) (Un-audited)Nine months period ended September 30Quarter ended September 30

(Un-audited) (Un-audited)Nine months period ended September 30Quarter ended September 30

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13. CASH GENERATED FROM OPERATIONS

Profit before income tax 675,725 845,353

Adjustment for non-cash charges and other items:

Depreciation 458,078 433,762 Amortisation 6,634 6,303 Provision for staff retirement benefits 44,035 65,596 Profit on bank balances (641) (237) Gain on disposal of operating fixed assets (480) (1,414) Provision for accumulated compensated absences 4,500 6,000 Exchange loss / (gain) - unrealised 4,356 (1,551) Finance cost 220,995 356,179 Working capital changes – note 13.1 (545,689) (810,814) 867,513 899,177

Nature of transaction Nature of relationship Purchase of goods and services Associated undertaking 260,210 258,501 Sale of goods and services Associated undertaking 852,753 785,326

Commission earned Associated undertaking 3,875 3,610

Dividend paid Associated undertaking and Directorship 257,848 97,800

Rights share subscription Associated undertaking

money received and Directorship - 717,237

Issue of rights shares Associated undertaking and Directorship - 57,379

Contributions to staff retirement benefit funds Retirement benefit funds 44,035 48,097

Salaries and other short Key management

term employees' benefits personnel 85,611 88,760

Transactions with related parties are as follows:


(Un-audited) (Un-audited)Nine months period ended September 30



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DirectorAsif Qadir

13.1 Working capital changes Decrease / (increase) in current assets:

Stores and spares 6,230 (127,946) Stock in trade 58,910 (276,201) Trade debts - net (125,197) (380,366) Advances and prepayments 22,282 (97,973) Refunds due from the government - sales tax (32,877) - Other receivables 23,663 13,310 (46,989) (869,176)

(Decrease) / increase in trade and other payables (498,700) 58,362 (545,689) (810,814)

14. CASH AND CASH EQUIVALENTS

Cash and bank balances 132,562 125,250 Short term running finances 6 (218,622) (243,503) (86,060) (118,253)

15. PLANT CAPACITY AND ACTUAL PRODUCTION

Operational capacity available during the period 62,850 62,850

Production 37,882 37,349

16. DATE OF AUTHORISATION FOR ISSUE

This condensed interim financial information was authorised for issue on October 18, 2017 by the Board of Directors of the Company.

Note





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Registered Office:4th Floor, The Forum, Suite No. 416-422G-20, Block No. 9, Clifton,Khayaban-e-Jami, Karachi-75600, Pakistan.Tel: 92 21-3587 4047-49, 3583 1618 Fax: 92 21-3586 0251

www.tripack.com.pk QuarterlyReportSeptember, 2017

quarterly september, 2017 - · pdf filefaysal bank limited habib bank limted habib...

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