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  • Shabbir Tiles and Ceramics Limited Condensed Interim Financial Statements

    For the Half Year Ended December 31, 2014 (Un-audited)

  • CONTENTS

    Company Information 1

    Directors’ Report 2

    Auditors’ Report 3

    Condensed Interim Balance Sheet 4

    Condensed Interim Profit and Loss Account 5

    Condensed Interim Statement of Comprehensive Income 6

    Condensed Interim Cash Flow Statement 7

    Condensed Interim Statement of Changes in Equity 8

    Notes to the Condensed Interim Financial Statements 9

    Shabbir Tiles and Ceramics Limited

  • COMPANY INFORMATION

    1

    BOARD OF DIRECTORS RAFIQ M HABIB Chairman RAZA ANSARI Chief Executive Officer ALI SULEMAN HABIB Director ALIREZA M. ALLADIN Director ABDUL HAI M. BHAIMIA Director SALIM AZHAR Director MUHAMMAD FAISAL Director

    AUDIT COMMITTEE MUHAMMAD FAISAL Chairman ABDUL HAI M. BHAIMIA Member SALIM AZHAR Member

    HUMAN RESOURCES AND SALIM AZHAR Chairman REMUNERATION COMMITTEE MUHAMMAD FAISAL Member ALIREZA M. ALLADIN Member

    COMPANY SECRETARY AZIZ AHMED

    AUDITORS ERNST & YOUNG FORD RHODES SIDAT HYDER Chartered Accountants

    LEGAL ADVISOR M. Akram Zuberi & Co. Advocate Supreme Court

    BANKERS Habib Metropolitan Bank Limited Faysal Bank Limited National Bank of Pakistan Habib Bank Limited Dubai Islamic Bank Pakistan Limited Allied Bank Limited

    REGISTERED OFFICE 15th Milestone, National Highway, Landhi, Karachi-75120 Phone: (021) 35015024-25, 35014044-45 Fax: (021) 35015545 / 35022920 E-mail: info@stile.com.pk URL: http://www.stile.com.pk

    KARACHI DISPLAY CENTRE Makro Cash & Carry, CAA, & SALES OFFICE Near Star Gate, Main Shahrah-e-Faisal, Karachi. Phone: (021) 34601372-74 Fax( (021) 34601375

    LAHORE SALES OFFICE Plot No. 523, Block # 15, Sector B-1, Quaid-e-Azam Town, (College Road), Lahore Phone: (042) 35117521-24 Fax: (042) 35117520

    ISLAMABAD SALES OFFICE 9th & 10th Lower Ground Floor, Aries Tower, Shamsabad, Muree Road, Rawalpindi. Phone: (051) 4575316-17 Fax: (051) 4575319

    PESHAWAR SALES OFFICE 3-Siyal Flats Opposite Kuwait Hospital, Abdara Chowk University Road, Peshawar. Phone: (091) 5846010/12 Fax: (091) 5846011

    REGISTRAR AND SHARE Noble Computer Services (Pvt.) Limited TRANSFER OFFICE First Floor, Siddiqsons Towers, House of Habib Building, 3-Jinnah Cooperative Housing Society, Main Shahrah-e-Faisal, Karachi Phone: (021) 34325482-84 Fax: 34325442

    FACTORY: UNIT-I 15th Milestone, National Highway, Landhi, Karachi-75120 Phones: (021) 35015024-25 / 35014044-45

    UNIT-II Deh Khanto, Tappo Landhi, District Malir, Bin Qasim Town, Karachi. Phones: (021) 34102702 Fax: (021) 34102709

    Shabbir Tiles and Ceramics Limited

  • DIRECTORS’ REPORT TO THE SHAREHOLDERS FOR THE HALF YEAR ENDED DECEMBER 31, 2014

    Dear Shareholders The Directors take pleasure in presenting their half yearly report along with reviewed condensed interim financial statements of the Company for the six months period ended December 31, 2014. The country continues to face extraordinary challenges on many fronts, be it Political power struggle coupled with the sit-ins and strikes, floods in the central region in the first quarter, which had a dampening effect on the demand for tiles. Further erosion of market share due to severe competition from Chinese/Iranian tiles created strong challenges for the Company and had a quite negative impact on the Company’s performance. The local industry as a whole and your company also had to tackle the large increase in gas Cess which created further inflationary impact on the local industry, which is facing severe competition against the cheap imported/smuggled tiles. The Company recorded a loss after taxation of Rs. 48.037 million compared to Rs. 56.406 million of the same period last year. The sales volume dropped by 11% as compared to last year period due to the factors mentioned above. The financial performance for the half year ended December 31, 2014 is summarized below

    July – December 2014 2013 Rupees in ‘000 Turnover – net 2,027,111 2,327,799 Earnings before interest, tax and depreciation 221,682 232,646 Loss before tax (39,681) (23,209) Loss after tax (48,037) (56,406) Loss per share (Rs.) (0.32) (0.37)

    Future outlook and challenges: Recently, National Tariff Commission rejected the plea of the tile industry to impose anti-dumping duty on tiles imported from China, Malaysia, Spain, UAE etc. However, the management is considering filing an appeal in the appellate tribunal of NTC in this regard. Recently the ITP of tiles from all Middle East/Iran region was further decreased which enabled the importers to clear out the stocks at port at very low rates causing serious injuries to local industry. The ceramic industry and your company has approached the relevant government ministry, to review the decision so as to ascertain the correct valuation of imported tiles so that the local industry will have space to compete. Despite the above facts, the management of the Company is taking serious steps to increase the volume and is introducing new innovative products of Floor tiles in the months to come. The construction industry in Pakistan is showing great growth prospects and the Company will try to take advantage of the same. Further, with the issue of right shares, the finance cost would decrease which will make the bottom line healthier. We take this opportunity to thank all stakeholders for their continued support.

    On behalf of the Board

    RAZA ANSARI Karachi : February 17, 2015. Chief Executive Officer

    2

    Shabbir Tiles and Ceramics Limited

  • AUDITORS’ REPORT TO THE MEMBERS ON REVIEW OF INTERIM FINANCIAL INFORMATION

    Introduction

    We have reviewed the accompanying condensed interim balance sheet of Shabbir Tiles and Ceramics Limited (the Company) as at 31 December 2014, the related condensed interim profit and loss account, condensed interim statement of comprehensive income, condensed interim cash flow statement, and condensed interim statement of changes in equity and notes to the accounts for the six-month period then ended (here-in-after referred to as “interim financial information”). Management is responsible for the preparation and presentation of this interim financial information in accordance with approved accounting standards as applicable in Pakistan for interim financial reporting. Our responsibility is to express a conclusion on this interim financial information based on our review.

    Scope of Review

    We conducted our review in accordance with International Standard on Review Engagements 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity.” A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

    Conclusion

    Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim financial information is not prepared, in all material respects, in accordance with approved accounting standards as applicable in Pakistan for interim financial reporting.

    Chartered Accountants Review Engagement Partner: Khurram Jameel Date: 17th February 2015 Place: Karachi

    3

    Shabbir Tiles and Ceramics Limited

  • December 31, June 30, Note 2014 2014 (Un-audited) (Audited) (Rupees in ‘000) ASSETS NON-CURRENT ASSETS Property, plant and equipment 4 2,852,482 2,945,072 Investment property 46 100 Long-term loans 45 90 Long-term deposits 9,479 9,355 2,862,052 2,954,617

    CURRENT ASSETS Stores and spare parts 134,987 141,099 Stock-in-trade 647,998 552,836 Trade debts 5 1,109,180 941,554 Loans, advances, deposits, prepayments and other receivables 26,516 16,768 Taxation - net 51,706 38,263 Cash and bank balances 99,727 124,444

    2,070,114 1,814,964

    TOTAL ASSETS 4,932,166 4,769,581

    EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES Authorised Capital 1,200,000 1,200,000

    Issued, subscribed and paid-up capital 757,341 757,341 Reserves 886,891 936,296 1,644,232 1,693,637

    NON-CURRENT LIABILITIES

    Long-term finance 6 1,000,000 447,649 Deferred tax liability 172,298 184,839

    1,172,298 632,488

    CURRENT LIABILITIES Trade and other payables 788,265 525,094 Accrued mark-up 81,351 58,456 Current maturity of long-term finance 444,266 506,766 Current maturity of liabilities against assets subject to finance lease 654 2,682 Short-term borrowings 765,130 1,303,697 Sales tax payable 35,970 46,761

    2,115,636 2,443,456 CONTINGENCIES AND COMMITMENTS 7

    TOTAL EQUITY AND LIABILITIES 4,932,166 4,769,581

    The annexed notes from 1 to 11 form an integral part of these condensed interim financial statements.

    CONDENSED INTERIM BALANCE SHEET AS AT DECEMBER 31, 2014

    4

    Shabbir Tiles and Ceramics Limited

    RAZA ANSARI Chief Executive Officer

    ABDUL HAI M. BHAIMIA Director

  • CONDENSED INTERIM PROFIT AND LOSS ACCOUNT FOR THE HALF YEAR ENDED DECEMBER 31, 2014