CONTENTS Company Information Core Values Our Equities and Initiatives Notice of Annual General Meeting Financial Summary Directors Report Statement of Value Added Statement of Compliance with the Code of Corporate Governance Review Report to the Members on Statement of Compliance with best Practices of Code of Corporate Governance Auditors Report to the Members Balance Sheet Profit and Loss Account Statement of Changes in Equity Cash Flow Statement Notes to and Forming Part of the Financial Statements Pattern of Shareholding Operating and Financial Highlights Form of Proxy 1 2 3 4 10 12 13 17 18 20 21 22 23 24 25 26 56 58 colgate.E.T. Aziz H. I.pk Chairman Chairman Chief Executive 2 . Chundrigar Road. Lahore WEBSITE www. Building No. Sarwar Shaheed Road. Chartered Accountants REGISTERED OFFICE Lakson Square. Chartered Accountants INTERNAL AUDITORS BDO Ebrahim & Co. 2. F. Karachi. FACTORIES G-6.COMPANY INFORMATION BOARD OF DIRECTORS Iqbal Ali Lakhani Amin Mohammed Lakhani Tasleemuddin Ahmed Batlay Jerome Graham Webb Derrick Samuel A.I.I. Kotri District Jamshoro (Sindh) 217.com. 1st Floor. Karachi-74200 Pakistan SHARES REGISTRAR FAMCO Associates (Private) Limited State Life Building No. Ferguson & Co. Ebrahim Zulfiqar Ali Lakhani ADVISOR Sultan Ali Lakhani AUDIT COMMITTEE Iqbal Ali Lakhani Amin Mohammed Lakhani Tasleemuddin Ahmed Batlay COMPANY SECRETARY Mansoor Ahmed AUDITORS A. Sundar Industrial Estate Raiwind Road. 1-A. S.. 3 . 4 . 5 . 6 7 8 9 . 1984 in the above matter including draft of the ordinary resolution to be passed pertaining to item No.47.Chundrigar Road. Karachi upto September 05. Members who have not yet submitted photocopy of their Computerized National Identity Cards (CNIC) are requested to send the same to our Shares Registrar at the earliest. 2011. Karachi not later than 48 hours before the time of the meeting. both days inclusive. 2011 at 10:00 a. Forms of proxy to be valid must be properly filled-in/executed and received at the Company's Registered Office at Lakson Square. Rs. Karachi to transact the following business: ORDINARY BUSINESS 1. 2011 will be considered in time for entitlement of the dividend and bonus shares. To receive. 2011 together with the Directors' and Auditors' Reports thereon. 4 is annexed. 3. must bring his/her participant's ID number and account/sub-account number alongwith original Computerized National Identity Card (CNIC) or original Passport at the time of attending the meeting. 5.10 each and if thought fit to pass an ordinary resolution in the matter. Form of Proxy is enclosed herewith.10 each and by way of issue of fully paid bonus shares @ 15% i. 7.e.NOTICE OF ANNUAL GENERAL MEETING NOTICE IS HEREBY GIVEN that the 33rd Annual General Meeting of COLGATE-PALMOLIVE (PAKISTAN) LIMITED will be held on Monday. I. 2. at Avari Towers Hotel.1-A. A member who has deposited his/her shares into Central Depository Company of Pakistan Limited. 4.290 by way of issue of 4. Fatima Jinnah Road. FAMCO Associates (Private) Limited. To appoint auditors and fix their remuneration. 6. State Life Building No.386. A member entitled to attend and vote at the general meeting may appoint another member as his/her proxy to attend.14 per share of Rs.2.738. 10 .629 fully paid bonus shares of Rs. By Order of the Board KARACHI: August 12. Sarwar Shaheed Road. 1st Floor. To consider. A statement under section 160 of the Companies Ordinance. in the proportion of three shares for every twenty shares held by the members as recommended by the Board of Directors. subject to declaration of the final dividend as above. 2011 NOTES: MANSOOR AHMED Company Secretary 1. 2011 to September 12. speak and vote instead of him/her. To declare final dividend in cash @ 140% i.m. Transfers received in order by the Shares Registrar of the Company M/s. 3. The share transfer books of the Company will remain closed from September 06.e. Building No.I. 2. September 12. Members are requested to notify the Shares Registrar of the Company promptly of any change in their addresses. capitalization of a sum of Rs. consider and adopt the audited financial statements for the year ended June 30. SPECIAL BUSINESS 4. in the proportion of 3 shares for every 20 existing shares held by the members and that such new shares shall rank pari passu in all respects with the existing ordinary shares of the Company. 2011 be capitalized and applied in making payment in full of 4. the Directors be and are hereby authorized to take all necessary steps in the matter and to settle any question or difficulties that may arise in regard to the distribution of the said new shares as they think fit.47. 1984 PERTAINING TO ITEM NO. ii) iii) for the purpose of giving effect to the above. the resolution as under will be considered to be passed by the members as an ordinary resolution: "RESOLVED THAT: i) a sum of Rs.386.629 ordinary shares of Rs. 2011.STATEMENT UNDER SECTION 160 OF THE COMPANIES ORDINANCE. 11 ." The Directors are interested in this business only to the extent of their entitlement of dividends and bonus shares as ordinary shareholders.4 The Board of Directors has recommended to the members of the Company to declare final dividend in cash @ 140% and by way of issue of fully paid bonus shares @ 15% for the year ended June 30. Subject to approval of the Board of Directors' recommendation as above. the fractional entitlements of shares of such members shall be consolidated into whole new shares and the Directors of the Company be and are hereby authorized to arrange sale of the shares constituted thereby in such manner as they may think fit and to pay the proceeds of the sale to such of the members according to their entitlement. in the event of any member holding less than 20 shares or a number of shares which is not an exact multiple of 20. however. 2011 @ 15% i.290 out of the profit for the year ended June 30. they will not qualify for the final cash dividend declared for the year ended June 30.738. 2011.10 each and that the said shares be allotted as fully paid up bonus shares to those members of the Company whose names appear in the register of members on September 12.e. 000 6.500 4.000 2.5% 2011 18.500 1.132 4.6% 53.00 2.00 25.995 1.000 16.) Shareholders' Equity 2009 13. 2011 Gross sales Rs in million 20.95 4.000 3.000 1.FINANCIAL SUMMARY Year Ended June 30.45 36.45 3.132 1.195 750 23.000 500 Shareholders' equity Rs in million Earnings Per Share Rupees 4.000 4.000 14.000 12.3% 12 .00 5.577 40.00 10.4% 1.00 2009 2010 2011 2009 2010 2011 23.796 1.restated (Rs.00 15.995 14.500 2.000 18.000 2.374 % Change 24.00 35.5% 32.584 18.00 20.95 Year ended June 30 Rupees in million except EPS Gross Sales Operating Income Net Profit After Tax Earnings per share .2% 1.000 10.000 2009 2010 2011 13.2% 48.700 2010 14.4% 22.500 3.775 1.167 36.3% 1.374 3.700 30.000 8.74 2.152 36.5% 53.577 % Change 4.584 1.74 36. 7% respectively.167 8.150 4. mainly due to increased sales volume of the Company coupled with increased fuel prices.9%.80% 1.584 11.2%) due to higher raw material prices. In absolute terms.3% and 22. 2011. Company's gross and net revenue increased by 24. Despite substantial increase in manufacturing cost and reduction in gross profit percentage. due to tough market conditions.2% 36. To defend and sustain this increased volume.2% 1.95 2009-10 Rs.3% 22. Company's gross profit increased in absolute terms by 8.7% 8.132 14.6% and 11.95 in current year. 'selling and distribution costs' and 'administrative expenses' increased by 14.2% and 1. depreciation increased by 40. and to consolidate market share of our brands. mainly due to strong volume growth. in terms of percentage to net sales.529 3. 2010: 16. in million 14. Additionally during the year. Other Overheads: In spite of various challenges which included acute electricity shortages.796 1. Gross Profit: Gross profit remained under pressure.4%.4% -1.830 33.2% 1.4% 1. and dropped by 3.4% from Rs.45 Increased By 24.0% 36.6%.1%.4% 13 . 2010: 1. However.2%). the Company 's management has been successful in reducing overall 'selling and distribution costs' (2011: 14.161 29.8 percent due to major capital investments in plant and machinery.6% -3. Selective price increases during the year enabled the Company to support brand margins. OPERATING RESULTS Revenue: During the year ended June 30. This increase is noticeably on a lower side compared to persistent inflationary pressures.45 in prior year to Rs. 2011.36. attributed by strong volume growth across all categories. Earnings per Share also increased marginally by 1.152 10. 2010: 33. In 'selling and distribution costs'.80 percent compared to last year (2011: 29.4% respectively.DIRECTORS REPORT The Directors are pleased to present the Annual Report with the audited financial statements of the Company for the year ended June 30. Company's advertising and sales promotion expenses are also on the rise. A brief financial analysis is presented as under: Operating Results Gross Revenue Net Revenue Gross Profit Gross Profit % Operating Profit Profit After Tax Profit After Tax (% to sale) Earnings per Share .36. this increase was not sufficient to fully offset the effect of the rising costs.1% respectively. freight expenses have shown a major increase. Operating Profit & NPAT: Company's operating profit and net profit increased by 1. in million 18. This has been achieved through continual improvement of controls as well as prudent spending. deteriorating law and order situation and a fragile economy.Rupees 2010-11 Rs.0%) and 'administrative expenses' (2011: 1. energy costs and freight charges.775 1.80% 1. 000 4. specialized oral health programs such as 'Bright Smile Bright Future' have continued. Company's achievements and overall performance have been recognized by the Management Association of Pakistan and was awarded "Corporate Excellence Award" at the 27th Corporate Excellence Award Ceremony. 14 .CSR The Company continued with its efforts for the betterment of the community as a whole by sponsoring various events throughout the year.Profit and Appropriations 2010-11 Rs. net cash and bank balances dropped by Rs. This shows management's continued commitment and dedication in achieving the desired operating results and in promoting the Company's image and goodwill.930 1. In order to increase awareness about oral health and hygiene. Reserve for proposed issue of bonus shares @ of 15% i. whereby every entrant gets a chance to win a Colgate Scholarship. The Karachi Stock Exchange also recognized your Company's performance in the financial year under report and was among the recipients of 'Top 25 Companies Awards'. STRIVING TOWARDS A HEALTHIER SOCIETY----------.50 per share). RECOGNITION For the 6th time. 3 shares for every 20 shares (2010.e.310 Profit After Tax Un-appropriated profit brought forward Profit available for appropriation Appropriations: Proposed Cash Dividend @ 140% i. Towards honoring its corporate social responsibility.e. 13. the Company had actively participated and contributed for the relief efforts of "Flood Victims" as well as for internally displaced persons (IDPs). 3 shares for every 20 shares).e.380 6.167.651 During the year.469 million mainly due to capital expending on plant & machinery and increased working capital requirement.174. @ 15% i.. An additional oral care health program "Seekho aur Jeeto Scholarship" was introduced with the objective of increasing awareness of Oral Hygiene by educating youth on healthy oral care tips.00 per share (2010. Rs. in thousand 1.14. A significant proportion of the investment was financed through internal cash generation. This is the 5th consecutive time that the Company has been presented this award. @ 135% i. Rs.e. HUMAN RESOURCES The Company offers its employees training courses on a continual basis and also offers them the opportunity to receive training in other Colgate Subsidiaries. Transfer to General Reserve Un-appropriated profit carried forward CASH FLOWS 442.386 680.273 47. Power outages will remain a big challenge to the progress of the manufacturing sector in Pakistan. The management remains focused to achieve these objectives through integration of all business strategies along with efficient cost curtailing measures.068 15 · · · · · . in million Provident Fund Gratuity Fund 298. The Company has maintained proper books of accounts. CORPORATE AND FINANCIAL REPORTING FRAMEWORK The Directors are pleased to state that the Company is compliant with the provisions of the Code of Corporate Governance as required by Securities & Exchange Commission of Pakistan (SECP). The summary of key operating and financial data of the Company of the last six years is annexed in this report. International Accounting Standards. have been followed. There are no doubts upon the Company's ability to continue as a going concern. the results of its operations. as detailed in the listing regulations. The process of monitoring Internal Controls will continue as an ongoing process with the objective to further strengthen the controls and bring in improvements in the system. All these above factors are likely to adversely affect the results of the Company during the ensuing financial year. The system of internal control is sound in design. its cash flows and its changes in equity. Appropriate accounting policies have been consistently applied in preparation of financial statements and accounting estimates are based on reasonable and prudent judgment. accurately present its state of affairs. Following are the statements on Corporate and Financial Reporting Frame Work: · · · · · The financial statements prepared by the management of the Company. The valuation of investment made by the staff retirement benefit funds based on their respective accounts are as follows: 2010-11 Rs. pressures on Company's gross margins are likely to intensify in light of further expected increase in raw material prices. management of your company remains to be committed to overcoming above challenges through sharp focus on assessing the needs of our consumers and bringing improved operational efficiencies and synergies through optimization of capital investments undertaken during the current year. Persistent inflation and increasing unemployment impacting disposable income will also be factors to reckon with. The system is being continuously monitored by an Internal Audit function and through other such monitoring procedures.717 107. Continued focus on product quality & innovation and developing & enhancing our volume base through aggressive marketing programs will remain our core objective in the ensuing year. In preparation of these financial statements. There has been no material departure from the best practices of corporate governance. as applicable in Pakistan. Information about taxes and levies is given in the notes to the accounts. However.CHALLENGES AND PROSPECTS Although Company has registered a strong growth with respect to volumes during the current year. AUDITORS The Auditors. Jerome Graham Webb Mr. We also value the support and cooperation of our customers. other employees and staff for their continued commitment to the success of the Company. A. 2011 IQBAL ALI LAKHANI Chairman 16 . Bieng eligible. Zulfiqar Ali Lakhani Mr.. ACKNOWLEDGMENTS We take pleasure by thanking members of the management. bankers and all stakeholders and wish to record our thanks and gratitude. Iqbal Ali Lakhani Mr. suppliers. Messrs A. Aziz Ebrahim Mr. Chartered Accountants. retire at the conclusion of the 33rd Annual General Meeting. 2011 is included in the report. Derrick Samuel Attendance 3 4 2 4 3 3 3 Nominee of CP-USA Nominee of CP-USA Leave of absence was granted to directors who could not attend some of the Board meetings. On behalf of Board of Directors Karachi: July 28. Ferguson & Co. they have offered themselves for re-appointment. Amin Mohammed Lakhani Mr.· The board held four (4) meetings during the year. Tasleemuddin Ahmed Batlay Mr. F. Attendance by each Director was as follows: Mr. PATTERN OF SHAREHOLDINGS A statement showing pattern of shareholding of the Company and additional information as at June 30. 612 489 12 857 5.4% 70.218 11.610 5.STATEMENT OF VALUE ADDED Year Ended June 30 2011 2010 (Rs.879 9.873 412 11 867 4.0% 30.4% 8.0% 10.0% 40. benefits and other costs To Government Income tax.0% 15.7% 0.0% 0. in million) Wealth Generated Total revenue net of discount and allowances Bought-in-material and services 17.608 13.608 547 2.0% 60.710 Wealth Distributed To Employees Salaries.0% 50. sales tax To Providers of Capital Dividend to shareholders Mark up/interest expenses on borrowed funds Retained for Reinvestment and Growth Depreciation and Retained Profits 638 3.2% To Government Depreciation & Retained Profit To Employees To Shareholders To Lenders 17 .710 64.0% 20.3% 11.169 4. 4. were circulated at least seven days before the meetings. The directors' report for this year has been prepared in compliance with the requirements of the Code and fully describes the salient matters required to be disclosed. The directors have confirmed that none of them is serving as a director in more than ten listed companies. Internal Audit function of the Company was outsourced with the approval of the Board. this year one of the Director of the Company Mr.I for the Certification of Directors under 'the Board Development Series' Program managed by the Pakistan Institute of Corporate Governance (PICG). The Board also arranged one orientation course for its directors during the year to apprise them of their duties and responsibilities and briefed them regarding amendments in the Companies Ordinance/Corporate Laws. The Company encourages the representation of independent non-executive directors on its board. The Company has prepared a 'Statement of Ethics and Business Practices'. 7. xiv of the Code of Corporate Governance of the amended Listing Regulations of the Stock Exchanges. All the resident directors of the Company are registered as taxpayers and none of them has defaulted in payment of any loan to a banking company. by a director elected by the Board for this purpose and the Board met at least once in every quarter. in his absence. including this Company. The remuneration and terms & conditions in case of future appointment on this position will be approved by the Board. which has been signed by all the directors and employees of the Company at the time of joining and subsequently confirmed by the departmental heads. have been taken by the Board. alongwith agenda and working papers. No casual vacancy occurred in the Board during the current year. Batlay has participated in the Corporate Governance Leadership Skill Program -part. while two represent the joint venture Company and the remaining two are non-executive. The meetings of the Board were presided over by the Chairman and. 6. 11. The minutes of the meetings were appropriately recorded and circulated. whereby a listed company is managed in compliance with the best practices of corporate governance. All the powers of the Board have been duly exercised and decisions on material transactions. Mr. including appointment and determination of remuneration and terms and conditions of employment of the CEO and other executive director. 3. 18 . The Company has applied the principles contained in the Code in the following manner: 1. The Board has developed a vision/mission statement. Mansoor Ahmed was assigned the responsibilities of Company Secretary of Colgate-Palmolive (Pakistan) Limited in addition to his responsibilities in other Group Companies. The Chief Financial Officer was appointed prior to the implementation of the Code of Corporate Governance. a DFI or an NBFI. one of them is the chairman. 10. 2011 This statement is being presented to comply with the Code of Corporate Governance (Code) contained in listing regulations of Karachi and Lahore Stock Exchanges for the purpose of establishing a framework of good governance. There are five non-executive directors. 9. A complete record of particulars of significant policies alongwith the dates on which they were approved or amended has been maintained. Tasleemuddin A.STATEMENT OF COMPLIANCE WITH THE CODE OF CORPORATE GOVERNANCE FOR THE YEAR ENDED JUNE 30. 2. 8. In compliance of the clause No. Written notices of the Board meetings. 5. and significant policies of the Company as part of overall corporate strategy. The Board comprises of seven directors including two executive directors. 18. 14. that they or any of the partners of the firm. 21. 13. The financial statements of the Company were duly endorsed by CEO and CFO before approval of the Board. 16. 2011 19 . 20. The terms of reference of the committee have been formed and advised to the committee for compliance. their spouses and minor children do not hold shares of the Company and that the firm and all its partners are in compliance with International Federation of Accountants (IFAC) guidelines on code of ethics as adopted by Institute of Chartered Accountants of Pakistan. 15. The Board has formed an audit committee. The directors. 17. CEO and executives do not hold any interest in the shares of the Company other than that disclosed in the pattern of shareholding. The Board has outsourced internal audit function of the Company to a firm of Chartered Accountants. The statutory auditors of the Company have confirmed that they have been given a satisfactory rating under the quality control review programme of the Institute of Chartered Accountants of Pakistan. The related party transactions have been placed before the audit committee and approved by the Board of Directors with necessary justification for non arm's length transactions and pricing methods for transactions that were made on terms equivalent to those that prevail in the arm's length transactions only if such terms can be substantiated. The Company has complied with all the corporate and financial reporting requirements of the Code. It comprises of two non-executive directors and one executive director.12. The statutory auditors or the persons associated with them have not been appointed to provide other services except in accordance with the listing regulations and the auditors have confirmed that they have observed IFAC guidelines in this regard. 19. We confirm that all other material principles contained in the Code have been complied with. The Chairman of the committee is a non-execute director. The meetings of the audit committee were held at least once every quarter prior to approval of interim and final results of the Company. Zulfiqar Ali Lakhani Chief Executive Tasleemuddin Ahmed Batlay Director Karachi: July 28. 35 of Karachi and Lahore Stock Exchanges requires the company to place before the Board of Directors for their consideration and approval related party transactions distinguishing between transactions carried out on terms equivalent to those that prevail in arm's length transactions and transactions which are not executed at arm's length price recording proper justification for using such alternate pricing mechanism.O. A review is limited primarily to inquiries of the company's personnel and review of various documents prepared by the company to comply with the Code. Tel: +92 (51) 2273457-60.com/pk> Lahore: 23-C. Chartered Accountants A. Gulberg V. a member firm of the PwC network State Life Building No. 2011 A. I. Behind Cinema Bariqot. REVIEW REPORT TO THE MEMBERS ON STATEMENT OF COMPLIANCE WITH BEST PRACTICES OF CODE OF CORPORATE GOVERNANCE We have reviewed the Statement of Compliance with the best practices contained in the Code of Corporate Governance for the year ended June 30. 3rd Floor. We are only required to check the approval of the related party transactions by the Board of Directors and placement of such transactions before the audit committee.F. Nahar-e-Darsan.Box 3021. all such transactions are also required to be separately placed before the audit committee. Sub-Regulation (xiii a) of Listing Regulation No. Tel: +92 (42) 35715864-71.. 2011. The responsibility for compliance with the Code of Corporate Governance is that of the Board of Directors of the company. Chartered Accountants. Our responsibility is to review. F. nothing has come to our attention which causes us to believe that the Statement of Compliance does not appropriately reflect the status of the company's compliance. As part of our audit of financial statements we are required to obtain an understanding of the accounting and internal control systems sufficient to plan the audit and develop an effective audit approach. 1. Karte-4. Further. +93 (799) 315320 20 . Shahrah-e-Quaid-e-Azam. 1916. Further. Tel: +93 (779) 315320. FERGUSON & CO. Karachi-74000. Fax: +92 (42) 35715872 Islamabad: PIA Building.I Chundrigar Road. Based on our review. Aziz Avenue. Canal Bank. July 28. We have not carried out any special review of the internal control system to enable us to express an opinion as to whether the Board's statement on internal control covers all controls and the effectiveness of such internal controls. to the extent where such compliance can be objectively verified. Afghanistan. P. F. 35 of the Karachi and Lahore Stock Exchanges where the company is listed. Islamabad-44000. Fax: +92 (21) 32415007/32427938.A. Karachi. Lahore-54660. P. Street No. FERGUSON & CO. 1-C.Box 39.O.O. Fax: +92 (51) 2277924 Kabul: House No. <www. Pakistan Tel: +92 (21) 32426682-6/32426711-5.pwc. Kabul. in all material respects. 49 Blue Area. Fazl-ul-Haq Road. We have not carried out any procedures to determine whether the related party transactions were undertaken at arm's length price or not. P. with the best practices contained in the Code of Corporate Governance as applicable to the company for the year ended June 30. FERGUSON & CO. whether the Statement of Compliance reflects the status of the company's compliance with the provisions of the Code of Corporate Governance and report if it does not. 2011 prepared by the Board of Directors of Colgate-Palmolive (Pakistan) Limited (the company) to comply with the Listing Regulation No. Box 4716. zakat deductible at source under the Zakat and Ushr Ordinance. Karte-4. Fax: +92 (21) 32415007/32427938. We conducted our audit in accordance with the auditing standards as applicable in Pakistan. Chartered Accountants A. statement of changes in equity and cash flow statement together with the notes forming part thereof conform with approved accounting standards as applicable in Pakistan. Pakistan Tel: +92 (21) 32426682-6/32426711-5. Box 4716. the expenditure incurred during the year was for the purpose of the company's business.O. in our opinion(i) the balance sheet and profit and loss account together with the notes thereon have been drawn up in conformity with the Companies Ordinance.O. Tel: +92 (51) 2273457-60. 1. P. 2011 Audit Engagement Partner: Saad Kaliya A. 1916. and (ii) (iii) the business conducted. Tel: +92 (42) 35715864-71.pwc. as well as. +93 (799) 315320 21 . <www. Canal Bank.I Chundrigar Road. FERGUSON & CO. Fazl-ul-Haq Road. the balance sheet. and give the information required by the Companies Ordinance. evidence supporting the amounts and disclosures in the above said statements. Behind Cinema Bariqot. investments made and the expenditure incurred during the year were in accordance with the objects of the company. FERGUSON & CO. 2011 and the related profit and loss account. AUDITORS' REPORT TO THE MEMBERS We have audited the annexed balance sheet of Colgate-Palmolive (Pakistan) Limited as at June 30. Islamabad-44000. and prepare and present the above said statements in conformity with the approved accounting standards and the requirements of the Companies Ordinance. on a test basis. Kabul. Street No. Tel: +93 (779) 315320. 1-C. proper books of account have been kept by the company as required by the Companies Ordinance. to the best of our knowledge and belief.. evaluating the overall presentation of the above said statements. 1980 was deducted by the company and deposited in the Central Zakat Fund established under section 7 of that Ordinance. Lahore-54660. Our responsibility is to express an opinion on these statements based on our audit. 3rd Floor. 1984. we report that(a) (b) in our opinion. P. 1984. and in our opinion. F. F. a member firm of the PwC network State Life Building No.O. 1984. statement of changes in equity and cash flow statement together with the notes forming part thereof. July 28. 2011 and of the profit. and are in agreement with the books of account and are further in accordance with accounting policies consistently applied. were necessary for the purposes of our audit. We believe that our audit provides a reasonable basis for our opinion and. 1984.Box 39. Afghanistan.Box 3021. Shahrah-e-Quaid-e-Azam. for the year then ended and we state that we have obtained all the information and explanations which. Nahar-e-Darsan. after due verification. Aziz Avenue. FERGUSON & CO. An audit includes examining. I. Fax: +92 (51) 2277924 Kabul: House No. Fax: +92 (42) 35715872 Islamabad: PIA Building.F. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the above said statements are free of any material misstatement. 49 Blue Area. Gulberg V. It is the responsibility of the company's management to establish and maintain a system of internal control. (c) in our opinion and to the best of our information and according to the explanations given to us. in the manner so required and respectively give a true and fair view of the state of the company's affairs as at June 30. its changes in equity and cash flows for the year then ended. (d) Karachi. Chartered Accountants.A. P. profit and loss account. Karachi-74000. An audit also includes assessing the accounting policies and significant estimates made by management.com/pk> Lahore: 23-C. 873.972 4.191 3.144 1.675 400.224 3.687.010.766 4.BALANCE SHEET AS AT JUNE 30.410.133 1.779 105.843 3.461 58 625 1.155 16.418 1.938 321.704 3.073 92.280 1.237 316.088.909 4.473 13 174.775 13.667.370.945 368.570 2011 2010 (Rupees in 000) 22 Zulfiqar Ali Lakhani Chief Executive Tasleemuddin Ahmed Batlay Director .916 124 1.000 315. 23 6. plant and equipment Intangible assets Long term loans Long term security deposits CURRENT ASSETS Stores and spares Stock in trade Trade debts Loans and advances Trade deposits and short term prepayments Other receivables Profit receivable from banks Taxation Cash and bank balances TOTAL ASSETS EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES Authorised share capital Issued.700 4.133 4.870 18.806.322.865 6.805 1.668.373.036.363 15.181 2.784 18.722.925 50.631 6.011.146 4 5 6 7 8 9 10 11 12 13 14 15 2.057.302.268 36.473 13.570 18 19 20 21 354.229.118 32.528 9.458 212. subscribed and paid-up share capital Reserves LIABILITIES NON-CURRENT LIABILITIES Deferred taxation Long term deposits CURRENT LIABILITIES Trade and other payables Accrued mark-up Current maturity of long term loan TOTAL LIABILITIES CONTINGENCIES AND COMMITMENTS TOTAL EQUITY AND LIABILITIES The annexed notes 1 to 41 form an integral part of these financial statements.108 1.806.353 2.424 16 16 17 400.573 618.410.966 1.877.021 2.928. 2011 Note ASSETS NON-CURRENT ASSETS Property.442 3.674 22.577.000 6.680.040 2.000 274.280 218. 021) (156.749) (164.95 36.206) 89.167.936 (2.989.644 1.583.778.796.057 (2. Zulfiqar Ali Lakhani Chief Executive Tasleemuddin Ahmed Batlay Director 23 .553) 1.564 25 26 27 28 (2.846.784.142.273) (794.297) 11.829.807) (986.192 (612.699.529.restated 31 36.573 1.639 Turnover Sales tax Special excise duty Trade discounts Net turnover Cost of sales Gross profit Selling and distribution costs Administrative expenses Other operating expenses Other operating income Profit from operations Finance cost Profit before taxation Taxation Profit after taxation Earnings per share (rupees) .114 29 (11.801) 1.420 24 (9.775.310 (7.193) (157.181 30 (616.882) 14.115.036) 1.PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED JUNE 30.081) 72.098) (142.856) 4.160.150.380 14.948) (215.151.056) (118.764.933) 1.909 (1. 2011 Note 2011 2010 (Rupees in 000) 18.132.45 The annexed notes 1 to 41 form an integral part of these financial statements.401) 3.228 (11. 873 13.174.205) (412. 2011 Transactions with owners Final dividend for the year ended June 30. subscribed and paid up share capital Capital reserve share premium Revenue reserves General reserve (Rupees in 000) Balance as at July 1.000 (740.167.000 740.380) 1.056) 1.151.704 13.000) 711.STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED JUNE 30.211) Unappropriated profit Total The annexed notes 1 to 41 form an integral part of these financial statements.704) (35. 2011 41.167.373.205 41.851) 4.000) (740.456 2.310) (370.130.205 315. 2009 (Rs 11.000) 427.675) 740.167.151.000 757.380) 1.851) (41.50 per share) Bonus shares issued at the rate of three shares for every twenty shares held Total transactions with owners Balance as at June 30.831 274.000) (440.380) 1.000 (274.690.639) 238.851) (370.158.000 440.870.456 1.146) 440.882) 2. 2010 Comprehensive income for the year Net profit for the year ended June 30.535) 1. 2009 Comprehensive income for the year Net profit for the year ended June 30. 2010 Transactions with owners Final dividend for the year ended June 30.000 (440.000 (370.909 13.151.831 35.639) 1.704) 3.704) (274.639) 1.380) 35. 2011 Issued. 2010 (Rs 13.456 2.577. 2010 Other comprehensive income Transfer to general reserve Total other comprehensive income Total comprehensive income for the year ended June 30.700.000 440.831) (310.639) 1.50 per share) Bonus shares issued at the rate of three shares for every twenty shares held Total transactions with owners Balance as at June 30.986) (274. 2011 Other comprehensive income Transfer to general reserve Total other comprehensive income Total comprehensive income for the year ended June 30. 24 Zulfiqar Ali Lakhani Chief Executive Tasleemuddin Ahmed Batlay Director .000 740. 229) 32 1.500) (274.843 (2.355 1.145) (659.491 2011 2010 (Rupees in 000) 15 The annexed notes 1 to 41 form an integral part of these financial statements.407) (276.475 (11.021 (994.694) (14.828 (11.220 (928.907) 63.088. Zulfiqar Ali Lakhani Chief Executive Tasleemuddin Ahmed Batlay Director 25 .106.926) 2.329 74.795) (200.024.087 210.CASH FLOW STATEMENT FOR THE YEAR ENDED JUNE 30.776.867) (838.420) (371.415 48. 2011 Note CASH FLOWS FROM OPERATING ACTIVITIES Cash generated from operations Finance costs paid Taxes paid Long term loans Long term security deposits Long term deposits Net cash inflow from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Fixed capital expenditure Purchase of intangible assets Purchase of short term investment Sale proceeds on disposal of property.665 830.021 618.061) (5.485.820) 12.539) 613 (535) 622 1.088.734 1.888 68 (766.000) 9. plant and equipment Profit received on savings and term deposit accounts Profit received on a term deposit receipt Sale proceeds on disposal of short term investment Net cash outflow from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Long term loan Dividend paid Net cash outflow from financing activities Net (decrease) / increase in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year (625) (370.867) (650.666 1.267 3.215) 7.045) (469.178) 1.249 (2. 13. amendments to approved accounting standards and interpretations that are not yet effective and have not been early adopted by the Company: IAS 24 (Revised). Standards. 2011 but are considered not to be relevant or do not have any significant effect on the Company's operations and are. therefore.3 Property. Related party disclosures. therefore. 1984 (the Ordinance) and the approved accounting standards as applicable in Pakistan. 2. The Company is listed on the Karachi and Lahore Stock Exchanges. 2010 but are considered not to be relevant or to have any significant effect on the Company's operations and are. Karachi. This revised standard supersedes IAS 24. 26 . Building No. personal care and other related products. 2. 2011: There are certain new approved accounting standards. Approved accounting standards comprise of such International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board as are notified under the Ordinance and the requirements of and directives issued under that Ordinance. 1990 when the Company entered into a Participation Agreement with Colgate-Palmolive Company. if any. amendments to approved accounting standards and interpretations that are mandatory for accounting periods beginning on or before January 1. 2. 1977 as a public limited company with the name of National Detergents Limited. USA. There are certain amendments to the standards and interpretations that are mandatory for accounting periods beginning on or after January 1.NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30. except for leasehold land and capital work in progress which are stated at cost. issued in 2003. issued in November 2009. the requirements of and the directives issued under that Ordinance have been followed where those requirements are not consistent with the requirements of the IFRSs. 2011. The registered office of the Company is situated at Lakson Square. as notified under the Ordinance. The name of the Company was changed to Colgate-Palmolive (Pakistan) Limited on March 28. not disclosed in these financial statements. 2. amendments to approved accounting standards and new interpretations becoming effective during the year ended June 30. 2011 1. not detailed in these financial statements.2 Statement of compliance These financial statements have been prepared in accordance with the requirements of the Companies Ordinance. IAS 24 (Revised) is mandatory for periods beginning on or after January 1. The revision is not expected to have a material impact on the Companys financial statements. Standards.1 SIGNIFICANT ACCOUNTING INFORMATION AND POLICIES Accounting convention These financial statements have been prepared under the historical cost convention except for the recognition of certain employee retirement benefits at present value in accordance with the actuarial recommendations as referred to in note 2. The revised standard clarifies and simplifies the definition of a related party and removes the requirement for government-related entities to disclose details of all transactions with the government and other government-related entities. 2. Related party disclosures. THE COMPANY AND ITS OPERATIONS Colgate-Palmolive (Pakistan) Limited (the Company) was initially incorporated in Pakistan on December 5. Pakistan. The Company is mainly engaged in the manufacture and sale of detergents. plant and equipment These assets are stated at cost less accumulated depreciation and accumulated impairment losses. Sarwar Shaheed Road. However. Depreciation is charged to income applying the straight line method by applying rates (as stated in note 4. at each balance sheet date and adjusted if the impact of amortisation is significant.1).4 Intangible assets An intangible asset is an identifiable non-monetary asset without physical substance. These are transferred to specific assets as and when assets are available for use. Loose tools are charged to income as and when purchased as their inventory is generally not significant. All other assets are charged to income in the year when acquired. plant and equipment and intangible assets may be impaired. is based on their condition as at the balance sheet date depending upon the management's judgement. technical and commercial obsolescence. 2. physical wear and tear. legal and similar limits on the use of the assets and other similar factors.5 Impairment The Company assesses at each balance sheet date whether there is any indication that property. Normal repairs and maintenance are charged to income as and when incurred. No depreciation is charged if the asset's residual value exceeds its carrying amount. Major renewals and improvements are capitalised. 2. Useful lives are determined by the management based on the expected usage of assets.Assets having cost exceeding the minimum threshold as determined by the management are capitalised. Provision for obsolete items. Residual values are determined by the management as the amount it expects it would receive currently for an item of property. 2. if any. Residual values and the useful lives are reviewed at each balance sheet date and adjusted if expectations differ significantly from previous estimates.e. 27 . plant and equipment if it was already of the age and in the condition expected at the end of its useful life based on the prevailing market prices of similar assets already at the end of their useful lives. Depreciation on additions is charged from the month in which the asset is put to use and on disposal upto the month of disposal at the rates stated in note 4. Costs associated with maintaining computer software are recognised as an expense as and when incurred. Intangible assets are stated at cost less accumulated amortisation and accumulated impairment losses. Profit or loss on disposal of assets is recognised in income currently. computer software) includes purchase cost and directly attributable expenses incidental to bring the asset for its intended use. Amortisation is charged over the estimated useful life of the asset on a systematic basis applying the straight line method.1.1 Capital work in progress All expenditure connected with specific assets incurred during installation and construction period are carried under capital work in progress.1. assets are written down to their recoverable amounts and the differences are recognised in income currently.1. 2.3.6 Stores and spares Stores and spares are valued at lower of cost using the moving average method and estimated net realisable value. Cost of the intangible asset (i. Useful lives of intangible operating assets are reviewed. If such indication exists. Where carrying values exceed recoverable amounts. if any. Intangible assets are recognised when it is probable that the expected future economic benefits will flow to the entity and the cost of the asset can be measured reliably. the carrying amounts of such assets are reviewed to assess whether they are recorded in excess of their recoverable amounts. Items in transit are valued at cost as accumulated upto the balance sheet date. 2. Cost is determined as follows: Stages of stock in trade Raw and packing material Raw and packing material in bonded warehouse and in transit Work in process and finished goods Trading goods Basis of valuation . considered irrecoverable. 2. For the purpose of the cash flow statement. 2.10 Cash and cash equivalents Cash and cash equivalents are carried in the balance sheet at cost. Deferred tax assets and liabilities are measured at the tax rate that are expected to apply to the year when the asset is utilised or the liabiltiy is settled.Moving average cost .8 Trade debts and other receivables Trade debts are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method less provision for impairment. Significant financial difficulties of the debtor. construction or production of a qualifying asset are recognised as part of the cost of that asset. and tax paid on presumptive basis.2.7 Stock in trade Stock in trade is valued at the lower of cost and estimated net realisable value. if any. A provision for impairment of trade debts and other receivables is established when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivable. as and when identified. cash and cash equivalents comprise of cash in hand. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised. deposits held with banks and running finances under markup arrangement. and default or delinquency in payments are considered indicators that the trade receivable is impaired.Cost of direct materials and appropriate portion of production overheads . based on the tax rates that have been enacted or substantially enacted at the balance sheet date.Cost accumulated upto the balance sheet date . All other borrowing costs are recognised as an expense in the period in which these are incurred.9 Taxation Current Provision for current taxation is based on taxable income for the year at the current rates of taxation after taking into account tax credits and tax rebates available. Deferred Deferred tax is recognised using the balance sheet liability method on all temporary differences between the carrying amount of the assets and liabilities and their tax bases. Debts. are written off. 28 . The carrying amount of the deferred tax asset is reviewed at each balance sheet date and is recognised only to the extent that it is probable that future taxable profits will be available against which the assets may be utilised. Unrecognised deferred income tax assets are reassessed at each balance sheet date and are recognised to the extent that it becomes probable that future taxable profit will allow deferred tax asset to be recovered.Moving average cost Net realisable value is determined on the basis of estimated selling price of the product in the ordinary course of business less estimated costs of completion and the estimated costs necessary to be incurred for its sale. probability that the debtor will enter bankruptcy or financial reorganisation.11 Borrowing costs Borrowing costs relating to the acquisition. Deferred tax liabilities are recognised for all major taxable temporary differences. Deferred tax assets are recognised for all major deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary differences can be utilised. 2. Appropriations of profit are reflected in the statement of changes in equity in the period in which such appropriations are approved.2.16 Dividend and other appropriations Dividend is recognised as a liability in the period in which it is declared. an approved funded gratuity scheme for all its permanent employees subject to attainment of retirement age and minimum service of prescribed period. Management determines the classification of its financial assets at the time of initial recognition. Contributions are made to the fund on the basis of actuarial recommendations. Actuarial valuation is carried out using the projected unit credit method. 2.15 Foreign currency translation Transactions in foreign currencies are translated in Pakistan rupees (functional and presentation currency) at the exchange rate prevailing on the date of transaction. at the beginning of the year. Assets in this category are classified as current assets. Equal monthly contributions are made. 2. A financial asset is classified as held for trading if acquired principally for the purpose of selling in the short term.14 Revenue recognition Sales are recognised on despatch of goods to customers. 29 . available-for-sale and held to maturity. it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed periodically and adjusted to reflect the current best estimates. loans and receivables. Profit on bank balances are recognised on a time proportion basis on the principal amount outstanding and at the applicable rate.e. a) Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss are financial assets held for trading and financial assets designated upon initial recognition as at fair value through profit and loss.1 Financial assets The Company classifies its financial assets in the following categories: at fair value through profit or loss. Monetary assets and liabilities in foreign currencies are translated into Pakistan rupees at the rates of exchange approximating those prevalent at the balance sheet date. Insurance commission income is recognised as and when received. both by the company and its employees. Compensated absences The liability in respect of compensated absences of employees is accounted for in the period in which the absences accrue.13 Staff retirement benefits Defined benefit plan The Company operates a defined benefit plan i. to the fund at the rate of 9 percent of the basic salaries of employees.17 Financial instruments 2. 2. Defined contribution plan The Company operates an approved funded provident fund scheme for all its permanent employees. are amortised over average future service of the employees. 2.12 Provisions Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events. 2. Actuarial gains / losses exceeding 10 percent of the higher of the present value of the defined benefit obligation and fair value of plan assets. Exchange differences are charged to income currently.17. The classification depends on the purpose for which the financial assets were acquired. Available-for-sale financial assets and financial assets at fair value through profit and loss are subsequently carried at fair value. 2. If the market for a financial asset is not active (for unlisted securities). except for maturities for greater than twelve months after the balance sheet date. Interest on available-for-sale securities calculated using effective interest method is recognised in the profit and loss account. deposits. Financial liabilities. The Company assesses at each balance sheet date whether there is objective evidence that a financial asset or group of financial assets is impaired. d) Held to maturity Financial assets with fixed or determinable payments and fixed maturity. the cumulative loss is removed from equity and recognised in the profit and loss account.17. or the terms of an existing liability are substantially modified. the accumulated fair value adjustments recognised directly in equity are included in the profit and loss account as gains and losses from investment securities. They are included in current assets.2 Financial liabilities All financial liabilities are recognised at the time when the Company becomes a party to the contractual provisions of the instrument. Financial assets carried at fair value through profit and loss are initially recognised at fair value and transaction costs are expensed in the profit and loss account. 30 . if any. Dividends on available-for-sale equity intruments are recognised in the profit and loss account when the Company's right to receive payments is established. c) Available-for-sale financial assets Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investments within twelve months from the balance sheet date. A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expired. loans and advances.b) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.e. Where an existing financial liability is replaced by another from the same lender on substantially different terms. other receivables and profit receivable from banks in the balance sheet. The fair values of quoted investments are based on current prices. Available-for-sale financial assets are classified as short term investments in the balance sheet. the Company measures the investments at cost less impairment in value. All financial assets are recognised at the time when the company becomes a party to the contractual provisions of the instrument. Regular purchases and sales of investments are recognised at trade date i. where management has the intention and ability to hold till maturity are carried at amortised cost. If any such evidence exists for 'available-for-sale' financial assets. are measured at amortised cost using the effective yield method. such an exchange and modification is treated as a derecognition of the original liability and the recognition of a new liability. When securities classified as available-for-sale are sold or impaired. which are classified as non-current assets. other than those at fair value through profit or loss. Consistent with prior years. 'Loans and receivables' and 'held to maturity' investments are carried at amortised cost using effective interest rate method. the date on which the Company commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the assets have expired or have been transferred and the Company has transferred substantially all risks and rewards of ownership. loans and receivables with less than twelve months maturities are classified as trade debts. Changes in fair value of securities classified as available-for-sale are recognised in equity. and the difference in respective carrying amounts is recognised in the profit and loss account. Financial assets are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit and loss. Impairment losses recognised in the profit and loss account on equity instruments are not reversed through the profit and loss account. assumptions and estimates used in calculating the provision for impairment for trade debts (note 10). Estimates and judgements are continually evaluated and are based on historical experience and other factors.047 1.873.19 Contingent liabilities Contingent liability is disclosed when: there is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company. or there is present obligation that arises from past events but it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation or the amount of the obligation cannot be measured with sufficient reliability.2 31 .18 Transactions with related parties Consistent with prior years.2. including expectation of future events that are believed to be reasonable under the circumstances.640 2. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of financial statements in conformity with approved accounting standards requires the use of certain critical accounting estimates. the Company enters into transactions with related parties for sale or purchase of goods and services on mutually agreed prices. assumptions and estimates used in accounting for defined benefit plan (note 39).071 555.088. assumptions and estimates used in writing down items of stock in trade to their net realisable value (note 9). The areas involving a higher degree of judgement or complexity.3 Off-setting of financial assets and financial liabilities A financial asset and a financial liability is offset and the net amount is reported in the financial statements if the Company has a legally enforceable right to set-off the transaction and also intends either to settle on a net basis or to realise the asset and settle the liability simultaneously. residual values and useful lives of property.144 592. plant and equipment (note 4). PROPERTY. assumptions and estimates used in determining the useful lives and residual values of intangible assets (note 5).318. and assumptions and estimates used in disclosure and assessment of provision for contingencies (note 23).680. PLANT AND EQUIPMENT Note 2011 2010 (Rupees in 000) 2. 4. It also requires management to exercise its judgement in the process of applying the Companys accounting policies. assumptions and estimates used in the recognition of deferred taxation (note 18).1 4. 2. 2.17. - 3.784 1. or areas where assumptions and estimates are significant to the financial statements are as follows: a) b) c) d) e) f) g) Assumptions and estimates used in determining the recoverable amount.118 Operating fixed assets Capital work in progress 4. 149) (95.312) 28.783) 40.024) (21. 2009 Cost Accumulated depreciation Net book value Year ended June 30.710) 78.055) (474) (732) 635) (97) (522) 420) (102) (7.190) 104.514) 7.735) 8.327) 130.694) (8.973 133. 2011 Additions Transfers from capital work in progress during the year Transfers with in fixed assets Cost Depreciation Net book value Disposals (note 4.452) 99.7) Cost Depreciation Net book value Write offs (note 4.184) 3.943) 19.552) 14.3) Cost Depreciation Net book value Depreciation charge for the year (note 4.769) 48.663 587 305.548) 30.636 442.386) 40. 2010 Additions Transfers from capital work in progress during the year Disposals (note 4.848) - (21.013) 31.1.717) 7.804) (5.452) (8.088.307) (13.959) 596) 20.048) 1.482) (3.448) (6.529) 2.502) (4.149) (127.668.093 1.701) 1. 2011 (518) 409) (109) (1.735) 8.815) 55.778) 191.608) 1.3) Cost Depreciation Net book value Depreciation charge for the year (note 4.572) 43.386) 338) (1.498) 41.187) (10.298) 8.621) 618.050) 3.720) 1.430) 811.621) (7) 61) (756) 22.759) (15.265) 57.931) 1.308) 26.465) 258.382) (4.853) (1.1 Operating fixed assets Electric Factory Gas Furniture Tools and Computers and Office Leasehold building on Plant and fittings and leasehold machinery installation installation and fixtures equipment Vehicles accessories equipment land land 40.366) 154) (86) 68) 7.067) 5.345) 24.1.321) 26.168) (6.017) 76.972) (20.722) 27.448) (6.140) 17.975) (6.318.099) 7.110) 328.144) 32 .422) 1.985) (437) 1. 2010 (467) 374) (93) (23) 5) (18) (490) 379) (111) (14.071) Year ended June 30.1.864) 41.071) 822.389) (312) (17) 12) (5) (1.559) (16.061) 805) 7.1.287) (14.199) (178.966) 134) (120) 14) (1.024.160) 2.8) Net book value as at June 30.287) 978) 34.738) 25.070) (35.216) 17.218) 6.206) 2.048) (7) (4.478) (14.278) 2.1 The following is a statement of operating fixed assets: Total -------------------------------------------------------------------------(Rupee'000)---------------------------------------------------------------------At July 1.235) 4.293) 36.045) 123.1.927) 4.023) (377.466) 2.351) 144.278) 68.579) (10.873) 54) 46.677) (644.644) 996.765) (69.011) 2.204.946) 24.346) 7.549) 2.1.236) (3.295) (98.1.214) (13.973 228.160) 6.320 73.048) 933) (115) (2.8) Net book value as at June 30.294) (4.7) Cost Depreciation Net book value Write offs (note 4.243) (250) 191) (59) (46) 2) (44) (13.973 154.447 4.4.645) 71.588) (86.997) (8.031 412.226) 26.312) 4.277) 3.269) (3. 2 Included in fixed assets are few items having cost of Rs 29.873) 154) (100) 54) 55.000 were disposed off during the year: 33 . the possession of which had been transferred to the company.278) 68.636 442.803) 71.474) 225.6 No impairment relating to operating fixed assets has been recognised in the current year.865) 55.067 million (2010: Rs 0.467) 98.1.778) (109.016.147) (94.1.973 264.204.389) 129.502) (16. in accordance with the terms of the allotment letter issued to the company by the local development and management company.071) Electric Factory Gas Furniture Tools and Computers and Office Leasehold building on Plant and fittings and leasehold machinery installation installation and fixtures equipment Vehicles accessories equipment land land Total 10 10 10 10 10 15 15 20 33 15 10 10 10 10 10 15 15 20 33 15 4.197) 46.318.279) 66.431 million) held by third parties for manufacturing certain products of the company.236) 41.973 154.744.823) 233.821) (762.281 million.1.035) (928.997) 99. These fixed assets are free of lien and the company has full rights of repossession of these assets. the company has identified certain items of property.269. However. 4.409) (447.647) 40. 4.710) 78.3 During the year.214 million (2010: Rs 0.482) 36.734) 24.045) 123.088.1.422) 1.5 Included in plant and machinery are assets which are secured with a bank against pari passu charge over plant and machinery of the company and the charge was not vacated as at June 30.676) 25.045 million (2010: Rs 40.052) (44.946) 62. 2011. 4.679) (51. plant and equipment from which further economic benefits are no longer being derived.327) 130.358) 27.954) (38.4 Leasehold land includes land situated in Lahore costing Rs 61.490 million) and net book value of Rs 1.-------------------------------------------------------------------------(Rupee'000)---------------------------------------------------------------------At June 30. 4. the project has been completed during the year and the process of issuance of sale deed is in progress. 4. 2010 Cost Accumulated depreciation Net book value Annual rates of depreciation (%) 2010 At June 30.720) 1.805) (11.174) 1. Further.143) (8.1.160) 2.065) 1.189) (29.722) 43.268) (109.187) 51. Therefore.621) 154) (93) 61) 28.043) (24. assets having cost of Rs 7.636 577.7 The following operating fixed assets with a net book value exceeding Rs 50.195) 3.676) (134.033) 22.066 million) held by related parties and of Rs 42.243) 2.111 million) have been retired from active use and have been written off in these financial statements.144) 40.1.232) 24.765) 822. the sale deed of land shall be executed upon the completion of the project.345) (540. These items do not include any assets which have been fully depreciated in prior years.030) (5.080.375 million (2010: Rs 29.158) (25. 2011 Cost Accumulated depreciation Net book value Annual rates of depreciation (%) 2011 71. (Rupees in 000) -----------------------245 215 277 701 215 215 651 596 624 518 326 434 119 143 345 405 174 167 394 8 5 11 6. Lakson Square Building No 3.465 950 265) 484) 264) 294) 94) (116) 266) 393) 175) 167) 4) 1) 8) 2.514 14. Karachi Century Insurance Company Limited.166 180 120 105 290 342 105 105 318 290 577 1. Employee of the company Altaf Hussain. Employee of the company Ahmed Rauf Rehmani. Sahiwal Syed Ahmed Iqbal. Employee of the company Waqar Hyder Zaidi.299) 770) Accumulated Net book depreciation value Particulars of purchasers Vehicles Maturity Of Company's Car Scheme --do---do---do---do---do---do---do-Maturity of Company's Maintained Car Scheme Bid --do---do---do-Negotiation --do---do---do---do---do-Insurance claim --do---do-- 365 320 567 1.359 504 595 240 1. Employee of the company Syed Hasan Mehdi Kazmi . Liaquatabad.329 3. Lakson Square Building No 3. Colony. House # D-712. Employee of the company Nadeem Ahmed . Usman Ghani. Garibabad. North Nazimabad.043 320 320 969 886 936 1.Particulars Mode of disposal Cost Sale proceeds / Gain / receivable from (loss) insurance company ----------------------.788 380 120 105 290 342 105 105 318 290 312 841 178 161 121 926 159 590 250 242 531 60 63 57 6.325 442 455 215 810 425 983 425 409 531 64 64 65 8. 50. Karachi Mohammad Ali. Ex-Employee of the company Mohammad Rafi. Karachi Others Items having Various net book value of less than Rs. Employee of the company Century Insurance Company Limited. Sarwar Shaheed Road. House # 14K. Block-R.069) 6. Employee of the company Maqsood S/O Mehboob Khan.954 560 Zubair Uddin Khan. Employee of the company Pervaiz Mallick. Sarwar Shaheed Road.287 9.168 8. Block-2.000 each 2011 2010 Various 13. Employee of the company Rehan Mirza.735 7. Sarwar Shaheed Road. Employee of the company Muhammad Rajal Irshad Khan. Ex-Employee of the company Mohsin Ali Bhojani. Employee of the company Kaleem Ishrat .069 504 995 424 409 925 68 68 68 12.415 12. Karachi Century Insurance Company Limited. Lakson Square Building No 3. Karbala Road.042) 34 . Karachi Muhammad Farooq. Ex-Employee of the company Mohammad Ramazan Fattani.448 6.346 6. Employee of the company Mumtaz Ahmed . House # 71. Ex-Employee of the company Sana Wasay. 118) 15.1 The following is a statement of capital work in progress: Leasehold Land Factory building on leasehold land 25. the possession of which had been transferred to the company.8 Depreciation charge for the year has been allocated as follows: Note Cost of sales Selling and distribution costs Administrative expenses 24.767 178.2 The aforementioned leasehold land is situated in Kotri.2. 2009 Capital expenditure incurred during the year Capital expenditure charged off during the year Transfers Transfers to operating fixed assets (note 4. the transfer deed has not been executed and its execution process is in progress.848) Balance as at June 30.278) (63.2.1) Balance as at June 30. 2010 Capital expenditure incurred during the year Capital expenditure charged off during the year Transfers Transfers to operating fixed assets (note 4.449) (328. however.1.594) 604.037) - (349) - (89) - (34.545) 849.1) - 2.157) (811.1.865) 592.962) (190) - - (305.124) Electric fittings and installation (Rupees in 000) 114.552) 161.159) 34.688) (36) - (10) (4.000 15.733) 538.047) 10.584) - (688) (89) 1.1 25 26 2011 2010 (Rupees in 000) 142.959) 20. 2011 10.226) 555.069) 506.320) (412.924) 12.645 4.579) Plant and machinery Other assets Total Balance as at July 1.953) (258.995) 739.033) 26.047 14.549) 362.361) 26.459) 71.568 13.631) - (144) 21.4.345 4.650) (16.483 127.310 22. 35 .779) (28.166) 9.2 Capital work in progress 101.778) - 172.000 137.969) 143.640) 4.866) (6.815 11.1.093) (31.106) 1. 282 18.775 52.2 5.978) 32.1.333 (16.074 14.262 25.155 5.321 48. 2010 Year ended June 30.133 (21.257) 11.3 6.775 96.000 (39.310 (6.006 24.206 17. 6.500 (43.774) 6.500) - 5. it is still in active use.due from executives .978 Selling and distribution costs Administrative expenses 6.5 Goodwill represents amount paid on acquisition of the brand Sparkle from Transpak Corporation Limited.4 5.761) 54.331 26.262 14.775 25. 2010.795 37.700) 5.935) 32.031 (41.1 Reconciliation of carrying amount of loans to executives: Opening balance as at July 1. 2011 Additions Amount charged off Transfers Amortisation for the year Net book value as at June 30.800) 43.206 .500 (82.500) 43. 2011 At June 30.892 21.269 (4.800 Computer Software software implementation (Rupees in 000) 15.761) (37.760) 13. INTANGIBLE ASSETS At July 1.086 10. 2005.411) 9.2 5.795 37.800 (5.155 58.307 7.178) 32.5 5.282 8. Amortisation charge for the year has been allocated as follows: Note 25 26 2011 2010 (Rupees in 000) 5.950 (19. The trade mark was fully amortised during the year ended June 30.889 19.820 (2.175 11.155 5.5 million in respect of the brand Sparkle purchased on January 4.850 (4.288 (10.957) 42.500 (37.2 & 6. The intangible assets included a trade mark costing Rs 1. This represents cost of SAP software implemented during the year ended June 30.225) 18.950 (19. 2001. 2010 / 2009 Disbursements Repayments Closing balance as at June 30 37 6. 2010 Additions Amount charged off Transfers Amortisation for the year Net book value as at June 30. 2010 Cost Accumulated amortisation Net book value At June 30. Computer softwares are being amortised over a useful life of 3 years. 2011 Cost Accumulated amortisation Net book value Note Goodwill 43.820 (2.725) 18.175) 18.2 11 6.286 13.155 101.321) - Total 84. However.537 (9. 2009 Cost Accumulated amortisation Net book value Year ended June 30.012 37.775 5.3 5.5 5.206 1.5. LONG TERM LOANS Considered good .090 (63.due from other employees Recoverable within one year 6.175) 18.435) 32.590 (20.906) 16.1 5.631 9.500 (43.528 9. in bonded warehouse . 2012 at which time the management intends to rollover the TDR.in hand .1 & 7.819 9.410 129.862 1.963 18.761 million).881 773.181 6.225 84.4 7.399 312.1 7.966 7. Any outstanding loan due from an employee at the time of leaving the service of the company is adjustable against final settlement of staff provident fund.712 73.in transit 24.322.353 8.3 26.534 36.1.1 37 .344 1.in hand .370.842 9.2 24.175 397.084 383 109.576 million (2010: Rs 0.096 1.410 million) representing amount deposited with Water and Power Development Authority (WAPDA) for enhancement in electricity load for detergent unit at Kotri.989 68.in hand .173 81.237 24.1.261 1.704 18.263 132.6.399 199. This TDR has been issued to provide security to a banking company for issuance of guarantee against a lien on the TDR.with third parties Work in process Finished goods .1 810.in hand . This includes a Term Deposit Receipt (TDR) amounting to Rs 1.084 million (2010: Rs 9.992 107.664 3.1 9.811 million ).209 358. The TDR carries profit at the rate of 7. 8. STOCK IN TRADE Raw materials .226% (2010: 4%) per annum and shall mature on September 1. STORES AND SPARES Stores Spares 8. The maximum aggregate amount of loans due from executives at the end of any month during the year was Rs 10. Long term loans have been carried at cost as the effect of carrying these balances at amortised cost would not be material.927 2.1.329 40.in transit .480 173. Note 2011 2010 (Rupees in 000) 6.3 6. These loans are to be repaid over a period of two to five years in equal monthly installments.132 412.7 million (2010: Rs 1.in transit Trading goods .2 This includes amount of Rs 4.7 million) issued by a banking company.in transit Packing materials .912 314.194 91 191.1 24. This includes spares in transit amounting to Rs 0.938 500.565.2 9. LONG TERM SECURITY DEPOSITS Long term security deposits 7.2 These loans are interest free and have been given to executives and other employees of the company for purchase of house.119 3. vehicles or for personal use in accordance with their terms of employment.410 million (2010: Rs 4.069 341 412.805 8. 5 As at June 30.407 21.654 124.269 million (2010: Rs 57.743 10.779 21.083 43.297 80.594 million (2010: Rs 21.3 & 10.382 7.169 million (2010: Rs 124.781 (3. TRADE DEBTS Considered good .2 2011 2010 (Rupees in 000) 718 320.169 62.092 21.628 10.966 30.others Less: Provision for impairment 10. trade receivables of Rs 30.628 8. LOANS AND ADVANCES Considered good Current portion of long term loans .674 3.5 10.760 9.073 30.628 338. These relate to a number of independent customers for whom there is no recent history of default.594 321. The ageing of these receivables is as follows: One year to five years Five years and over 23.836 85.4 As at June 30. The ageing analysis of these trade receivables is as follows: Upto 1 month 1 to 6 months More than 6 months 12.to contractors and suppliers 6 11.003 316.594 7.210) 21.899 72.367 35.779 Trade debts include the following amounts due from related parties: Merit Packaging Limited Clover Pakistan Limited Century Paper and Board Mills Limited Tetley Clover (Private) Limited Hasanali Karabhai Foundation SIZA Services (Private) Limited Television Media Network (Private) Limited Cyber Internet Services (Private) Limited SIZA Foods (Private) Limited 25 23 555 4 3 99 9 718 42 384 247 46 4 3 44 6 776 10.337 6.073 776 316. 2011.835 26.Note 10. 2011.015 92.789 24.1 11.817 million).621 105.1 10.594 351.due from other employees Advances .others Considered doubtful .536 7.due from executives .856 million) were past due but not impaired.to employees .355 321.628 million) were impaired and provided for.212 30.057 17.594 14.569 9.856 10. trade receivables of Rs 80.due from related parties .628 316.628 11.2 3.906 9.667 30. Provision for impairment Balance as at the July 1 Provision made during the year Amounts written off (against provision) Balance as at the June 30 27 21.363 38 .017 7.3 10.1 & 10.2 The maximum aggregate amount of receivable due from related parties at the end of any month during the year was Rs 53. 11.1 15.Current accounts . OTHER RECEIVABLES Receivable from related parties Federal excise duty claimable Claims receivable from an insurance company Sales tax refundable Others 13.938 million (2010: Rs 10.972 13. TRADE DEPOSITS AND SHORT TERM PREPAYMENTS Security deposits Prepayments 5.190 34 3.149 564. The rate of profit on this term deposit account is nil per annum (2010: 11.2 The range of rates of profit on these savings accounts is between 5.948 237 1. The maturity period of the term deposit account is one month from the date of original issue.930 106 362 6 9 3.172 15.224 14. CASH AND BANK BALANCES With banks on: .780 17.376 258 618.191 13.2 The maximum aggregate amount receivable from related parties at the end of any month during the year was Rs 20.930 500 41.088.000 1. 39 .060 424.1 Advances to employees are provided to meet business expenses and are settled as and when the expenses are incurred.00% to 11.201 million).Term deposit account Cheques in hand Cash in hand 140.996 352 352 11.843 117.2 Advances include the following amounts due from related parties: Century Insurance Company Limited Television Media Network (Private) Limited Century Publication (Private) Limited Rollins Industries (Private) Limited 12.Savings accounts .1 15.75% per annum (2010: 5% to 11% per annum).2 7.925 3.021 15.50% per annum).989 200.1 Other receivables include the following amounts due from related parties: Century Insurance Company Limited Clover Pakistan Limited Colgate-Palmolive Philippine Rollins Industries (Private) Limited Tetley Clover (Private) Limited 134 742 7.145 22. 15.992 2.439 604 50. Note 2011 2010 (Rupees in 000) 393 611 1.1 & 13.209 54.847 741.490 13.836 27.2 15.473 3.054 7. PROFIT RECEIVABLE FROM BANKS Profit on savings and term deposit accounts Profit on a term deposit receipt 3 10 13 3.007 3.490 379 322 4.800 12.059. 3) 27.670 94.000 1.882 12.792 63.2 Issued.590.583.547 bonus shares of Rs 10 each (2010: 3.456 2.000 1.3 20.945 5.708.3 257.302. These deposits are interest free and are not refundable during the subsistence of relationship with the company.214 19.882.174 12.174.766 13.120.545 2.318 58.353 Ordinary shares of Rs 10 each fully paid in cash Ordinay shares of Rs 10 each 21.441 262.605 17.Others 13. 16. TRADE AND OTHER PAYABLES Trade creditors Accrued liabilities Bills payable Amounts due to distributors Special excise duty payable Sales tax payable Royalty payable to an associated undertaking Workers profits participation fund Workers welfare fund Retention money payable Unclaimed dividend Others 20.395 596.775 500 5 6.821 36.456 2.Share premium reserve Revenue reserve .1 20.085 bonus shares of Rs 10 each) issued by the company during the current year.148) (10.587.880 274.865 16.000 16.909 215.Transporters .870.000 Ordinary shares of Rs 10 each 2011 2010 (Rupees in 000) 400.667.470.440 500 5 13.16.074 (4.461 20.280 19.085 315.012 104.904 1.473 224.000 40.882.999 95.360 2.1 SHARE CAPITAL Authorised Capital 2011 2010 Number of shares 40.192 49.801 7.000. LONG TERM DEPOSITS Security deposits obtained from: .512 31.310 4. RESERVES Capital reserve .824 25.428 332.Distributors .709 35.000 400.1 20.412 9.Unappropriated profit 2011 2010 (Rupees in 000) 13.2 485.760 89.442 17.708) 354.329 (5.629 8.158.4 40 .916 331.504) (7.057.986 3.965 issued as fully paid bonus shares (note 16.000 19.284 7.704 These shares include 4. 18.348 1.570) 212.824 58. subscribed and paid-up capital 5.010.353 5.130.General reserve .000. DEFERRED TAXATION Credit / (debit) balances arising in respect of timing differences relating to: Accelerated tax depreciation allowance Provision for compensated absences Provision for impairment of trade debts 370. 2012.084 3. stores and spares.072 277 1.212 84 36.709 95.254.601 61.264 million and Rs 11.3 Workers' profits participation fund Balance at the beginning of the year Allocation for the year 27 20.709 95. trade debts.351 186 14.140 million (2010: Rs 1.36% to 17.140 million). which can be interchangeably utilised as running finance facilities or import credit facilities. The facilities for opening letters of credit and guarantee as at June 30. 2011 to June 30.091 million and Rs 9 million (2010: Rs 2.517 2.821 1.359 467 142 1.528 94. The renewed facilities are available for various periods expiring between August 15.175 million and Rs 30 million (2010: Rs 3.493 908 2.528 94.954.556 4.00%) per annum.821 190. The arrangements are secured by a joint hypothecation of stocks. 2011 aggregated Rs 3.1 SHORT TERM RUNNING FINANCES The company has arranged short-term borrowing facilities from various banks on mark-up basis to the extent of Rs 1.696 1.709 20.4 These balances include the following amounts due to related parties: Colgate-Palmolive Pakistan Limited Employees Contributory Provident Fund Trust Colgate-Palmolive (Thailand) Limited Colgate-Palmolive (Hong Kong) Limited 3. These facilities expired during the year and were renewed subsequently.2 22.Note 20. 22. 41 22.575 94.720.25 million and Rs 30 million) respectively of which the amounts remaining unutilised at the year end were Rs 2.00% (2010: 13.603 20.3 .237 61.27% to 16. The mark-up on short-term running finance facilities ranges between 14.7 million) respectively.1 These balances include the following amounts due to related parties: Hasanali Karabhai Foundation Princeton Travels (Private) Limited Merit Packaging Limited Century Insurance Company Limited Century Publication (Private) Limited Century Paper & Board Mills Limited Television Media Network (Private) Limited Tetley Clover (Private) Limited 2011 2010 (Rupees in 000) 603 11.781.Short term borrowings 124 124 15 43 58 22.Long term loan .709 156.500 4.460 24.530 Less: Payments during the year Balance at the end of the year 94.349 21.397 299 3. other current assets and second charge on immovable assets of the company.2 These balances include the following amounts due to related parties: Century Paper & Board Mills Limited Clover Pakistan Limited Merit Packaging Limited 580 995 1. ACCRUED MARK-UP Accrued mark-up on: . 004 million (2010: Rs 519.528 million).401 2011 2010 (Rupees in 000) 42 .23.989. Subsequently.092 million). 23.2 Outstanding letters of credit and acceptances amount to Rs 759.667.2 Cases have been filed against the company by some employees claiming approximately Rs 1.410.2. the Octroi Contractor had also filed an appeal requesting to enhance the amount of decree.1 Commitments in respect of capital expenditure amount to Rs 101.517 8. based on the advice of its legal counsel handling the subject cases. 23.027 million (2010: Rs 8.898 million (2010: Rs 58.455 million alongwith interest at the rate of thirteen percent (13%) per annum filed by the Octroi Contractor against the Government of Sindh.1. based on the advice of its legal counsel handling the subject matter.337 9.4 Contingent liabilities in respect of indemnities given to financial institutions for guarantees issued by them on behalf of the company in the normal course of business aggregate Rs 21 million (2010: Rs 18.8 million) in aggregate.3 Post dated cheques have been issued to custom authorities as a security in respect of duties and taxes amounting to Rs 382.336 million in favour of Octroi Contractor. the Honorable Senior Judge issued a decree of Rs 7. KATI had filed an appeal in the High Court of Sindh. In the event the goods are not cleared from custom warehouse within the prescribed time period. The relevant case has been dismissed by the Senior Civil Judge in favour of KATI. 23.1.468. Subsequently the Octroi contractor has filed an appeal in the District Court Jamshoro against the dismissal.150 million) payable at the time of exbonding of imported goods. COST OF SALES Opening stock of finished goods (including trading goods) Cost of goods manufactured Purchases of trading goods Less: Closing stock of finished goods (including trading goods) 24.541 million (2010: Rs 1.535.1 As a result of a recovery suit of Rs 31.918 398. 23.743 million).445 8.324 million (2010: Rs 114. cheques issued as security shall be encashable. Note 24.856 347. whereas. If the contractor's appeal is decided in its favour.919 10. is of the opinion that matters shall be decided in the companys favour. no provision has been made in the financial statements on this account. being a member of KATI. 23.1 CONTINGENCIES AND COMMITMENTS Contingencies 23.340.3 Outstanding duties leviable on clearing of stocks amount to Rs 16.393 1. Accordingly. is confident that the appeal will be decided in favour of KATI. 23.699. Provision has not been made in these financial statements for the aforementioned amounts as the management of the company.193 545. then the company. the case was transferred to the Additional District Judge Kotri by the High Court of Sindh.097.1 9 398. Union Council Bulari and Kotri Association of Trade and Industries (KATI) in the Civil Court.517 7. would be required to pay its share as determined by the Court out of the total decree amount.3 million). The District Judge allowed the appeal in favour of KATI and remanded the case to Senior Civil Judge Kotri for adjudication.1.2 Commitments 23.757 1.080 6.2.2. The management of the company.1. 23. 8 2011 2010 (Rupees in 000) 4.429 54.992 4.410 6.244 16.539 1.638 1.Raw materials .1.784.792 40.297 142.536.380.836.705 18.329 1.628.1 Raw materials consumed Opening stock Purchases Less: Closing stock 24.399 5.804 5.861 24.659 1.1 & 24.900 584.2 & 24.536.081 24.268.315.1.190 7.805 47.151 2.805 22.889 68.219 9.757 105.989 1.1.468.383.992 6.531 773.138 26.505.132 8.1 Cost of goods manufactured Opening stock of work in process Raw materials consumed Packing materials consumed Stores and spares consumed Salaries.1.2 24.841 17.521 1.329 1.991 6.3 Stores and spares consumed Opening stock Purchases Less: Closing stock 8 18.746 1.340.118 1.480 5.503 720 1. wages and other benefits Staff retirement gratuity Provident fund Power and fuel Repairs and maintenance Rent.686 22.958 5.397 209.2 Packing materials consumed Opening stock Purchases Less: Closing stock 9 9 773.126 7.Note 24.Finished Goods 1.976.836.360.3 39.078 10.366 6.047 33. rates and taxes Insurance Laboratory expenses Cartage Depreciation Other manufacturing expenses Less: Recovery from related parties Insurance claims against fire damages Less: Closing stock of work in process 9 24.242 36.784.250.668 29.889 321.089.539 91.310 26.686 24.861 29.Packing materials .747 8.248 101.457 4.393 24.889 15.837 79.539 4.2 Cost of sales includes amounts written off during the year in respect of the following: .250.565.315.060 4.478 1.867.015 109.1.402.1.1.670 5.356 1.8 40.900 261.074 5.453 - 43 .850 191.638 109.2 24.437 66.567 41.399 6.889 8.353 29.661 169. 081 94.150 4. telephone and internet charges Rent.291 88.652 3.151 3.written off Donations Advances to ex-employees written off Provision for impairment .670 10.288 4.768 3. ADMINISTRATIVE EXPENSES Salaries.057 1.859.084 49.214 17.630 5.603 2.454 11.749 71.850 2.trade debts Net exchange loss 20. OTHER OPERATING EXPENSES Workers profits participation fund Workers welfare fund Auditors remuneration Property.3 27.123 1. telephone and internet charges Rent.206 44 .709 35.268 164.417 92 389.815 11.086 6.966 3.483 10.477 22.1 4. rates and taxes Printing and stationery Subscription and membership Legal and professional Freight Electricity Insurance Security service charges Depreciation Amortisation Other expenses Less: Recovery from related parties 26.821 36.151 63.486 6.699 3.481 732 157.729 3.133 5.3 95.594 1.410 5.629 2.870 12.867 2.003 5.557 33.776 2.984 3.440 2.1.8 2011 2010 (Rupees in 000) 204.253 6.386 2.412 1.365 142.2 10.393 1.802 1. SELLING AND DISTRIBUTION COSTS Salaries.667 2.892 1. wages and other benefits Staff retirement gratuity Provident fund Travelling and conveyance Repairs and maintenance Vehicle running expenses Advertising and sales promotion Royalty on sale of licensed products Postage.973 5.891 3.841 3.753 732 142.115.8 5.Note 25.479 2 503. plant and equipment .781 635 156.161 2.846.287 31.767 13. rates and taxes Printing and stationery Subscription and membership Legal and professional Electricity Insurance Security service charges Depreciation Software amortisation Others Less: Recovery from related parties 39.098 4.646 13.033 1.719 5.127.1.491 13. wages and other benefits Staff retirement gratuity Provident fund Travelling and conveyance Repairs and maintenance Vehicle running expenses Postage.999 10.743 3.568 3.193 184.747 7.129 5.808 13.8 39.308 3.021 27.974 14.735 37 17.898 13.357 2.495 1.021.5 4.260 4.846 16.889 480 158.799 3.724 5.902 7.120.948 78.8 5.931 2.677 2.179 6.1.1 27.343 8.286 13.568 5.051 14.284 914 111 6.5 78. Note: Mr Zulfiqar Ali Lakhani. 10 Beaumont Road. Korangi Road.7 4.220 3.2 Donations include the following in which a director is interested: Name of director Mr Iqbal Ali Lakhani Interest in donee Name and address of donee 600 450 (See note below) Special Olympics Pakistan. 5.1 Auditors remuneration Audit fee Fee for half yearly review and other certifications Out of pocket expenses 2011 2010 (Rupees in 000) 480 470 107 1. 28.042 1.080 3.057 400 425 89 914 27.955 6.500 13. DHA. Karachi. Mr Zulfiqar Ali (See note below) Donation made to Swat IDPs Lakhani. plant and equipment Sale of scrap Profit on sale of material 45. his spouse and children are trustees of the donee organisation.115 72. Mr Iqbal Ali Lakhani (See note below) Pakistan Business Council. Off. Mr Amin through Hasanali Karabahi Mohammed Lakahni Foundation.662 3.069 77. Expressway. Sunset Tower. Mr Zulfiqar Ali Lakhani (See note below) Zulfiqar & Fatima Foundation. 9 Khayaban-e-Ghazi. Phase-II. M-02 Mezzanine Floor.573 3.767 46 89.069 3. DHA. Karachi. Plot No. Note: Spouse of Mr Iqbal Ali Lakhani is the Program Chief Executive of the donee organisation. Sunset Boulevard. Beaumont Plaza.200 6. Note: Mr Sultan Ali Lakhani is the trustee of donee organization. OTHER OPERATING INCOME Income from financial assets / liabilities Profit on savings and term deposit accounts Profit on a term deposit receipt Profit on short term investment Gain on disposal of short term investments Liabilities no longer payable written back Income from non-financial assets Insurance commission Gain on disposal of property.1.000 Note: Mr Iqbal Ali Lakhani is a common director.644 45 . 150 1. Mr Sultan Ali Lakhani (See note below) Express Helpline Trust.063 295 10.275 68 491 2. PhaseV. 205.Note 27. Karachi.023 - 4. Karachi. and Mr Iqbal Ali Lakhani Note: The above mentioned directors are trustees of the Hasanali Karabahi Foundation. plant and equipment written off Capital work-in-progress charged off Intangibles charged off Working capital changes 2011 2010 (Rupees in 000) 1.933 3.000 612.45 31.553 30.828 1.167.51) 0.275) (68) 11.590.Long term loan .Note 29.restated 2011 2010 (Rupees in 000) 1.95 31.761 (97. 2011 2010 Percentage Applicable tax rate Tax effect of income that is not taxable in determining tax liability Tax effect of income assessed under presumptive tax regime Tax effect of income tax provision relating to prior year Tax effect of surchage 35. CASH GENERATED FROM OPERATIONS Profit before taxation Adjustment for non-cash charges and other items: Depreciation and amortisation expense Gain on sale of property.08 1.639 (Number of shares) 31.936 1.865 (Rupees) 36.57 35. There are no dilutive potential ordinary shares outstanding as at June 30. EARNINGS PER SHARE Profit after taxation Weighted average number of ordinary shares outstanding during the year .080) (3.933 237 1.1 32.764.036 635 11.353 306 9.966 (45.475 32.for prior years' Deferred 2011 2010 (Rupees in 000) 7 622 363 10.063) (10.04 34.941 11.72 31.380 1.for the year .181 197. 2011 and 2010.865 36.09) (1.784.restated Earnings per share .140 11.00 (0.trade debts Advances to employees written off Profit on savings and term deposit accounts Profit on a term deposit receipt Profit on disposal of short term investment Finance costs Net exchange loss Stocks written off Property. FINANCE COST Markup on: .268 2.473 616.042) 17.069) 8.00 (0.513 111 89 2.776. plant and equipment Provision for impairment .1 46 .1 Reconciliation between the average effective tax rate and the applicable tax rate.590.618) 1.323 (6.801 560.436 142.485.220) 11.214 190 (463.151.32) 0.036 472.09 34. TAXATION Current .800 753 51.192 149.892 1.781 37 (77.248) 1.Short term borrowings Guarantee commission Bank commission and other charges 30.820 (3. 543 (6. bonus issue of 4.400 5.889 (463.937 17 721 15 99 21 1 594.1 Working capital changes (Increase) in current assets: Stores and spares Stock in trade Trade debts Loans and advances Trade deposits and short term prepayments Other receivables Increase in current liabilities: Trade and other payables 2011 2010 (Rupees in 000) (17.148 (97.273 million (2010: Rs 370.930 54.051. 2011.084 6 78 20 79 512.651 47 .1 RELATED PARTY DISCLOSURES Disclosure of transactions between the company and related parties The related parties comprise associated companies. services provided and reimbursement of expenses Century Paper & Board Mills Limited Clover Pakistan Limited Merit Packaging Limited Rollins Industries (Private) Limited Tetley Clover (Private) Limited Cyber Internet Services (Private) Limited Hasanali Karabhai Foundation SIZA Services (Private) Limited Televison Media Network (Private) Limited Siza Foods (Private) Limited Lakson Business Solution Limited Note Relationship with the Company 2011 2010 (Rupees in 000) Associate Associate Associate 34. Significant balances and transactions with related parties are as follows: Nature of transaction Sale of goods.851 million).282) (1.588 9.260) 13.640 423 22.5 per share) for the year ended June 30. The company in the normal course of business carries out transactions with various related parties. amounting to Rs 442. staff retirement funds. directors and key management personnel.318) 4.32. 34.122.637) (13.121 million shares) at the rate of three shares for every twenty shares held (2010: three shares for every twenty shares held) and transfer to general reserve of Rs 680 million (2010: Rs 740 million) subject to the approval of members at the annual general meeting to be held on September 12.143 113 571.479 82 484.548) (1.953) (46.202 6.618) 33.137) 658. 34. PROPOSED DIVIDEND The Board of Directors at their meeting held on July 28.766) 34.739 million shares (2010: 4.3 Related party Associate Associate Associate Associate Associate Associate Associate 371 15. 2011 have proposed a cash dividend of Rs 14 per share (2010: Rs 13.667) (205.752 7.949 (131.248) (3. 2011. 093 47.800.340 2.235.014 931 54. plant and equipment SIZA Services (Private) Limited Clover Pakistan Limited Merit Packaging Limited 210.817 70.048 670 2.619 Rent.235 36.314 259 2.118 1.999 49.654 1.032 14.335 706 43.523 2.085 438 14.000 - Sale proceeds on redemption of short term investments Lakson Investments Limited Associate Profit on short term investments Lakson Investments Limited Royalty charges Colgate-Palmolive Company USA Sale of property.752 2.144 750 2.219 - Associate 296 - Joint venture company 63.437 3.025 95.389 7. allied and other charges Hasanali Karabhai Foundation SIZA Services (Private) Limited Reliance Chemicals (Private) Limited Century Paper & Board Mills Limited Associate Associate Associate Associate 15. services received and reimbursement of expenses Century Insurance Company Limited Century Paper & Board Mills Limited Century Publication (Private) Limited Clover Pakistan Limited Colgate-Palmolive China Colgate-Palmolive (Vietnam) Limited Colgate-Palmolive Company USA Colgate-Palmolive (Hong Kong) Limited Colgate-Palmolive (Thailand) Limited Cyber Internet Services (Private) Limited Lakson Business Solution Limited Merit Packaging Limited Princeton Travels (Private) Limited Pakistan Business Council Rollins Industries (Private) Limited 34.670 Associate Associate Associate 25 25 150 260 410 48 .149 18.448 9.106 6.037 63.693.646 68.064 710 2.002.329 153.697 16.743 137.103 24 30 6 2.179 233 18.984 8.992 10.824 61.186 16.3 SIZA (Private) Limited SIZA Foods (Private) Limited SIZA Services (Private) Limited Sybird (Private) Limited Tetley Clover (Private) Limited Television Media Network (Private) Limited Associate Associate Associate Associate Subsidiary of CP-USA Subsidiary of CP-USA Joint venture company Subsidiary of CP-USA Subsidiary of CP-USA Associate Associate Associate Associate Common Director Related party Associate Associate Associate Associate Associate Associate 84.470 270.548 46.867 Purchase of short term investments Lakson Investments Limited Associate 200.512 1.Nature of transaction Note Relationship with the Company 2011 2010 (Rupees in 000) Purchase of goods.803 2. 492 3.3 35.483 Joint venture company Associate Associate Associate Associate Associate Related party 34. loans and advances (note 11) and trade and other payables (note 20).288 450 6.2 Related party Associate Associate Common Director Related party Compensation paid to key management personnel Short-term employee benefits including compensated absences Key management personnel Post employment benefits --do-Insurance claims received Century Insurance Company Limited Insurance commission income Century Insurance Company Limited Purchase of property.666 27.662 3.434 111. 35. including certain benefits to the chief executive.196 600 1.917 16. are as follows: 34.2 The related party status of outstanding balances as at June 30.Nature of transaction Note Relationship with the Company 2011 2010 (Rupees in 000) Contribution to staff retirement benefits Colgate-Palmolive (Pakistan) Limited Employees Contributory Provident Fund Colgate-Palmolive (Pakistan) Limited Employees Gratuity Fund Donations Special Olympics Pakistan Hasanali Karabhai Foundation Zulfiqar & Fatima Foundation Pakistan Business Council Express Helpline Trust Employees fund Employees fund 15. Rollins Industries (Private) Limited is a third party whose manufacturing process is dependent on the company. 2011 are included in trade debts (note 10 ).049 30.541 1.094 104.778 Associate Associate 4.502 6.579 25. other receivables (note 13).721 10.551 77.600 27.023 17.323 13.006 29.255 136 60.420 82.870 25.411 101 44.365 55 6.955 Associate Associate Associate 82 32.2 27.371 30.449 21.264 15 339.362 33.200 2.2 27.500 13.732 34.055 2.2 27.2 27.381 11 251.1 49 .834 17.287 65 32. REMUNERATION OF CHIEF EXECUTIVE. plant and equipment Tetley Clover (Private) Limited Clover Pakistan Limited Lakson Investments Limited Dividend paid Colgate-Palmolive Company USA Century Insurance Company Limited Premier Fashions (Private) Limited SIZA (Private) Limited SIZA Services (Private) Limited SIZA Commodities (Private) Limited Rollins Industries (Private) Limited 27. the director and executives of the company.000 150 6. DIRECTOR AND EXECUTIVES The aggregate amount charged in these financial statements for remuneration. 542 129.1. the financial assets that are subject to credit risk amounted to Rs 997. including trade receivables and committed transactions.224 1.248 12.249 million (2010: Rs 1.659 5. The companys overall risk management focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the companys financial performance.522.507 FINANCIAL LIABILITIES Financial liabilities at amortised cost Long term loan Long term deposits Trade and other payables Accrued mark-up 16.085 335 546 188 938 195 218 4.430 13 618.975 million).800 3.975 13.458.592 9.727 77 Chief executive.966 316.280 769.279 367 578 206 1. credit risk and liquidity risk.507 million (2010: Rs 1.939 6.528 9. Such financial risks emanate from various factors that include.1 Credit risk and concentration of credit risk Credit risk represents the accounting loss that would be recognised at the reporting date if counter parties fail completely to perform as contracted.026 212 237 4. Risks measured and managed by the company are explained in notes 37.905 1 2. derivative financial instruments and deposits with banks and financial institutions. FINANCIAL INSTRUMENTS BY CATEGORY FINANCIAL ASSETS Loans and receivables at amortised cost Long term loans Long term security deposits Trade debts Loans and advances Trade deposits Other receivables Profit receivable from banks Cash and bank balances 2011 2010 (Rupees in 000) 13.3 below: 37.458.398 5.614 809 528 8. 50 .887 58 776. Credit risk arises from cash and cash equivalents. market risk.1. Out of the total financial assets of Rs 997.436 28.073 20.711 12.2 and 37.090 124 1.238 1.088.505 1 2011 Executives 2010 64.949 36.333 1 Director 2011 2010 (Rupees in 000) 2.382 1.850 37.1 FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES The companys activities expose it to certain financial risks.503 Number of persons 35.742 3.945 1.812 3. 37.855 10.500 11.1.021 1.382 1.630 58 85.1.2 36.Chief Executive 2011 2010 Managerial remuneration Bonus / commission Staff retirement gratuity Provident fund Housing Utilities Motor vehicles Others 5.631 6. but not limited to. a working director and the executives of the company are also provided with company maintained cars.212 1. as well as credit exposures to customers.652 6.508.738 million). 37.843 997.181 321.159 625 6.458.1.780 8. 1 5.614 899 608 8.779 19.085 163. 37.779 19.396 10.585 997.812 3.747 337.784 1. internal risk assessments process determines the credit quality of the customer. 2011.780 8.631 Out of Rs 350.073 20. taking into account its financial position.249 The bank balances along with credit ratings are tabulated below: Credit ratings A-1+ A-1 A2 F1+ F1 551. 51 .594 million (2010: 21.996 2.631 million).825 2.127 564. the company has provided Rs 30.181 321.949 million (2010: 337. The management believes that it is not exposed to any significant level of liquidity risk.738 Due to the companys long standing business relationships with these counterparties and after giving due consideration to their strong financial standing.800 3. Accordingly the credit risk is minimal and the company also believes that it is not exposed to major concentration of credit risk.224 1.044.2 Liquidity risk Liquidity risk is the risk that an enterprise will encounter difficulties in raising funds to meet commitments associated with financial instruments.362 1.458. This involves monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans. The breakup of amount due from customers other than related parties as stated in note 10 is presented below: Due from customers other than related parties Institutional customers Distributors 233.884 116.949 220. For trade receivables.638 1. Individual risk limits are fixed based on internal or external ratings in accordance with limits set by the management.324 1.The maximum exposure to credit risk as at June 30.836 16.515 350.059.628 million) as the amounts being doubtful to be recovered from them. The management forecasts the liquidity of the company on basis of expected cash flow considering the level of liquid assets necessary to meet such risk. past experience and other factors. The utilisation of credit limits is regularly monitored.742 3.377 9. along with comparative is tabulated below: Financial assets Long term loans Long term security deposits Trade debts Loans and advances Trade deposits Other receivables Profit receivable from banks Cash and bank balances 2011 2010 (Rupees in 000) 13.434 117. management does not expect non-performance by these counter parties on their obligations to the company.1.966 316.430 13 618.087.659 5.209 1.528 9.631 6. The Company does not have financial instruments dependent on market prices.1. or factors affecting all similar financial instruments traded in the market. Consequently. 2010 (Rupees in 000) 625 625 769. The company places its funds in banks having good credit ratings as also stated in note 37. between knowledgeable willing parties in an arm's length transaction.280 6. or a liability settled.945 6.945 1.508. 2011 (Rupees in 000) 1.887 58 776.159 13.225 625 6.945 13. 37.887 58 776. 52 . 2011 the company's financial instruments mainly affected due to changes in the interest rates are balances placed on deposits with banks where changes in interest rates may have impact on the future profits / cash flows.159 Financial liabilities Long term loan Long term deposits Trade and other payables Accrued mark-up 37. The company primarily has foreign currency exposures in US Dollars (USD).4 Fair value of financial instruments Fair value is an amount for which an asset could be exchanged. At June 30.945 1.280 769. 2011 the net fair value of all financial assets and financial liabilities are estimated to approximate their carrying values.522. 2011. At June 30.090 124 1.1.945 13.280 769. This will mainly result due to foreign exchange gains / losses on translation of USDdenominated bank balances and bills payables.214 13.887 58 769.508.Financial liabilities in accordance with their contractual maturities are presented below : Interest/mark-up bearing Non.508.090 124 1. Other price risk Other price risk is the risk that the fair value or future cash flows from a financial instrument will fluctuate due to changes in market prices (other than those arising from interest rate risk or currency risk).508.interest/mark-up bearing Maturity Maturity Sub-total Maturity Maturity Sub-total within one after one within one after one year year year year Total Financial liabilities Long term deposits Trade and other payables Accrued mark-up June 30. if the currency had weakened / strengthened by 5% against the USD with all other variables held constant.1. pre-tax profit for the year would have been higher / lower by approximately Rs 30 million (2010: approximately Rs 6 million ). differences may arise between the carrying value and the fair value estimates.090 124 1.3 Market Risk Currency Risk 625 625 June 30.850 Foreign currency risk arises mainly where receivables and payables exist due to transactions entered into foreign currencies. The effects of changes in interest rates on the future profits arising on the balances placed on deposits with banks is not considered to be material.1. whether those changes are caused by factors specific to the individual financial instrument or its issuer. Interest rate risk Interest / mark-up rate risk arises from the possibility that changes in interest / mark-up rates will affect the value of financial instruments.522. As at June 30.280 6. 38. 39.3 53 .1 38.14 are based on the information included in the actuarial valuation report as of June 30. The company does not have transactions with any external customer which amount to 10 percent or more of the entity's revenues.4 Information about major customers Information about major customers constitutes information relating to revenues from transactions with any single external customer which amount to 10 per cent or more of an entity's revenues. 2011 and 2010.Discount rate . Revenues from external customers attributed to foreign countries in aggregate are not material.per annum 13 11 .per annum compound 14 12 .2 DEFINED BENEFIT PLAN (Staff Retirement Gratuity) The disclosures made in notes 39. Home Care and Others.Expected rate of return on plan assets . Information about products The company's principal classes of products accounted for the following percentages of sales: 2011 Personal Care Home Care Others 24% 73% 3% 100% 38. the company may adjust the amount of dividends paid to shareholders. 38.2 to 39.3 Information about geographical areas The company does not hold non-current assets in any foreign country. Debt is calculated as total borrowings ('long term loan' and 'current maturity of the long term loan' as shown in the balance sheet). 38.1 39. As at June 30. return capital to shareholders or issue new shares or sell assets to reduce debt. the company manages its capital risk by monitoring its debt levels and liquid assets and keeping in view future investment requirements and expectation of the shareholders.per annum 14 12 Mortality rate The rates assumed were based on the EFU 61-66 mortality table. 2011. 39.2 ENTITY-WIDE INFORMATION The company constitutes of a single reportable segment. Total capital comprises shareholders equity as shown in the balance sheet under 'share capital and reserves'.1. In order to maintain or adjust the capital structure. The projected unit credit method using the following significant assumptions was used for this valuation: 2011 2010 Percentage . the principal classes of products of which are Personal Care. the company had surplus cash reserves to meet its requirements and there was no net debt position. 2011. Consistent with others in the industry. The actuarial valuation of gratuity plan was carried out as at June 30. 2010 23% 74% 3% 100% 39.37.Expected rate of increase in salaries .5 Capital risk management The companys objectives when managing capital are to safeguard the companys ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure. 962 (22.465 23.924 11.511) - 112.5 39.4 The amounts recognised in the balance sheet are as follows: Present value of defined benefit obligation Fair value of plan assets Deficit Unrecognised net actuarial losses Unrecognised past service cost Payable to the gratuity fund 39.371 (1.431 10. 2010 / 2009 Actuarial loss/(gain) on obligations Actuarial loss/(gain) on assets Subtotal Actuarial gain/(loss) recognised 54 Unrecognised actuarial (gain) / loss as at June 30 22.7 Movement in net liability in the balance sheet is as follows: Charge for the year Contributions made during the year to the fund Closing balance of net liability 39.10 Unrecognised actuarial losses Net unrecognised actuarial (gains)/losses at July 1.871 3.955 3.336 (871) 22.752 (1.954 9.371 10.305 16. 2010 / 2009 Current service cost Interest cost Actuarial losses Transfer of an employee Benefits paid Present value as at June 30 39.068 17.544) 135.962 16.924 82.561) 112.059 13.544) 107.137) 22.6 Movement in fair value of plan assets Fair value as at July 1.1 25 26 39.948 3.990 (3.990 64 (6.362 13.899 6.347) - 112.948) 16. 2010 / 2009 Expected return on plan assets Actuarial Gain Company contributions Transfer of an employee Benefits paid Fair value as at June 30 39.059 13.962 9.958 2.973 3.561) 82.6 2011 2010 (Rupees in 000) 135.362 9.366 3.924 82.440 16.431 10.551 3.743 17.371) - 10.186 (3.269) 23.253 3.9 24.186 (1.068 27.615 3.955) 17.362 64 (6.615 .962 29.137 (6.269 17.8 39.044 90.551 1.044 107.914 1.371 (16.362 (17.836 871 (9.224 39.371 9.8 Charge for the year has been allocated as under: Cost of sales Selling and distribution costs Administrative expenses 39.976 (22.253 The following amounts have been charged to income in respect of the gratuity plan: Current service cost Interest cost Past service cost non vested Actuarial loss charge Expected return on plan assets Actual return on plan assets 11.5 Movement in defined benefit obligation Present value of defined benefit obligation as at July 1.305) 23.837 1.Note 39.914 3.465) (5.362) - 57.615) (7. 95 3.899) 33.82 (8.962) 29.781) 19. 2011 by the board of directors of the company.679 16.068) 27.597 3.79 73.924 (82. present value of the defined benefit obligation and the deficit arising thereon are as follows: 2011 As at June 30 Present value of defined benefit obligation Fair value of plan assets Deficit Experience adjustment: Gain / (loss) on plan assets (as percentage of plan assets) Loss on obligations (as a percentage of obligation) 2010 2009 (Rupees in 000) 2008 2007 135.05 2.83 (4.72 100.28 5. PLANT CAPACITY AND ACTUAL PRODUCTION 2011 2010 (Quantities in tons) Capacity Production The underutilisation of capacity was due to market constraints.550 78.32) 5.281 million (2011: Rs 17.149) 23.839 107.378 (42.962 90.055 72.460 135.75 8.14 Expected contribution to post employment benefit plan for the year ending June 30.954 (57.976 112.13 The expected return on plan assets is based on the market expectations and depends upon the asset portfolio of the company. 208.12 Plan assets comprise of the following: 2011 (Rupees in 000) Percentage 11.962 12.044 (107.94 39.447 2. 41.49 15.93 100.505 (49. 40.362 million).426 144.11 Amounts for the current period and previous four annual periods of the fair value of plan assets.00 Shares and units of mutual funds Debt Cash 39.055 70.344 Zulfiqar Ali Lakhani Chief Executive Tasleemuddin Ahmed Batlay Director 55 .068 10.46) 4.39. 39.98 2. DATE OF AUTHORISATION FOR ISSUE These financial statements were authorised for issue on July 28. for returns over the entire life of related obligation. 2012 is Rs 19.460 82.460 117.00 2010 (Rupees in 000) Percentage 10.48 84.59 2.356 62. at the beginning of the period. 921.413 39.000 95.000 15. and their spouses and minor children Associated Companies.042 21. Foreign From 1 101 501 1.102.42 1.005832 No of shareholders 338 159 68 84 6 5 1 1 1 1 1 2 1 1 1 1 1 1 1 674 Categories of shareholders Directors.920. 2011 Incorporation Number K-5010 OF 1997-78 CUIN Registration NO. 56 .110.001 30.621 1.510.252 31.000 1.656.918.185 2.001 9.480.001 10.000 10.802 410 8.904 11.74 30.587 9. Chief Executive Officer.001 105.001 8.21 0.574 16.102 28.478.001 25.000 To Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Shares Total shares held 6.000 110.920.001 240.308 57.001 Total Shareholdings 100 500 1. Local b.915. Non Banking Financial Institutions Insurance Companies Modarabas and Mutual Funds Shareholders holding 10% General Public a.000 20.923 214.000 9.001 1.757 40.000 30.352 2.477.423 549.001 40.001 5.580 8.001 2.000 8. Development Financial Institutions.115.000 35.184 32.80 0.475.13 66.655.253 43.000 45.PATTERN OF SHAREHOLDING Held by the Shareholders as at June 30.001 15.000 2.176 Percentage 1.480.570.764 1.000 2.111.000 5.566 171.475.218 43.001 0.001 90.779 5.925.001 5.001 2.942 23.000 5.180 92.29 Zulfiqar Ali Lakhani Chief Executive Some of the shareholders are reflected in more than one category.006 74.591 9.590.04 0.863 shares held 357. undertakings and related parties NIT and ICP Banks.660.882 240.000 245. 590. 11. Gulbanoo Lakhani Mr.918.863 57 . Natasha Lakhani Miss Anushka Zulfiqar Lakhani Miss Anika Amin Lakhani SHARES HELD 2. NON-BANKING FINANCIAL INSTITUTIONS.661 623 380 326 126 288 418 NIT AND ICP 1. Tasleemuddin Ahmed Batlay Director Mr.478. 6.252 h) INDIVIDUALS AND OTHER THAN THOSE MENTIONED ABOVE 614. Ebrahim Director Mr. Trustee Deptt. Iqbal Ali Lakhani Chairman/Director Mr. Colgate-Palmolive Co. 14. 3.656. 12. Amin Mohammed Lakhani 3. National Bank of Pakistan. Shaista Sultan Ali Lakhani Mr. Bilal Ali Lakhani Mr.477. Aziz H. USA Mrs. SIZA Commodities (Pvt) Limited M/s. 15. Babar Ali Lakhani Mr. 7.111.580 11. Jerome Graham Webb Nominee of Colgate-Palmolive Company.032 3..764 205 407 28.327 31. 5. 8.322 240. 6. 7.184 NIL d) e) f) EXECUTIVES PUBLIC SECTOR COMPANIES AND CORPORATIONS BANKS. MODARABAS AND MUTUAL FUNDS: [Other than those reported at a(5)] SHAREHOLDERS HOLDING 10% OR MORE M/s. Premier Fashions (Pvt) Limited M/s.556 1.846 g) 9. 9.921. 8. 10.779 5. INSURANCE COMPANIES.466 1. Sultan Ali Lakhani Mrs. SIZA (Pvt) Limited M/s. Zulfiqar Ali Lakhani Director/Chief Executive Mr.DETAILS OF PATTERN OF SHAREHOLDING AS PER REQUIREMENTS OF CODE OF CORPORATE GOVERNANCE a) ASSOCIATED COMPANIES. 9. 13. 2. Mr. 4.185 518 354 1. DEVELOPMENT FINANCIAL INSTITUTIONS. 2. SIZA Services (Pvt) Limited M/s. Derrick Samuel Nominee of Colgate-Palmolive Company. 5. Danish Ali Lakhani Miss Sanam Iqbal Lakhani Mrs. Saira Amin Lakhani W/o.352 8. Investment Corporation of Pakistan 257 153 c) DIRECTORS.591 2. Zulfiqar Ali Lakhani Mrs. Ronak Iqbal Lakhani W/o. 10. USA.621 1. 2. b) M/s. Fatima Lakhani W/o. Iqbal Ali Lakhani Mrs. [Other than those reported at a(2)& a(4)] 10. 4. UNDERTAKINGS AND RELATED PARTIES 1.290 106. CEO AND THEIR SPOUSES AND MINOR CHILDREN 1. 3. A. Century Insurance Company Limited Mrs. Amin Mohammed Lakhani Director Mr. USA Mr. 035.093 218.626 11.468 2.235 (1.781.879 1.867 1.139 749.151.801 896.677 8.146 238.994.582 818.784.304.445.755 986.072.281 23.098 1.450 ) 1.706 899.949 ) 1.160.764.036.367 1.795.795.605 291.494 963.034 124.380 14.310 7.942 ) (164.293 7.297 3.832.553.364.785.681 ) 1.750.709 2.936 2.796.144 ) (61.553 1.775 22.141.114 11.146.021.373 1.716 679.738 ) (112.085 368.867.468 (853.882 3.994.442 3.926 1.921 (1.175.751 6.337.832.527 ) 34.155 1.450 932.426 2008-2009 2007-2008 (Rupees in 000) 1.075 2005-2006 739.965 124.989.490 162.283 167.573 (2.245 201 2.877.680.556 3.050.965 1.211 191.933 1.856 834.825 4.138.019.875 1.156.189 ) 118.401 3.011.001 ) (59.040.081 ) 72.309 769.333 270.115.110 122.144 1.155 23.235.543 PROFIT AND LOSS ACCOUNT Turnover Less : Sales tax & sed : Trade discounts Net turnover Cost of sales Gross profit Administrative.256 42.508 ) 53.909 4.329 794.534 774.009 341.935 1.854 604.240 14.687.304.929.268 3.192 612.029 11.587 1.140 5.642 13.297 (1.298.118 32.702 (877.237 581.355 878.054.742.966 8.873.373.150.411.950.829.756 2.093 2009-2010 1.680 4.948 637.plant and equipment Intangible assets Long term loans and security deposits Current assets Current liabilities TOTAL ASSETS EMPLOYED REPRESENTED BY Equity Paid-up capital Reserves Surplus on revaluation of investments Non-Current liabilities Liabilities against assets subject to finance leases Long term loans.502 112.792 2.855 58 .418 368.067 1.928.934 (1.057 2.700.715 21.870 2.704 3.302.478 498.286 1.972 48.411.953 3.637 14.105 396.175 7.418 4.290 1.543 1.801 1.114.054.984.402 461.057.200 11.784 18.228 11.583.767 424.400 17.866.148.420 9.742.040 2.544 152.411 (1.406 14.074 24.597 1.820 1.707.363 5.191.746 1.167.335 357.181 616.280 3.018.766 4.837 17.490 2.538 1.390.280 218.566 2.956 2010-2011 2.528 1.826 ) 782.639 13.260.264.943 1.286.988.644 (2.700 1.206 ) 89.036 1.426 167.132 1.586.795 ) 61.402 5.015 1.265 2.018.482.461.564 (2.259 (1.513 999.075 111.856 4.494 162.909 (1.283 2.699.668.577.272.529.119 ) (156.168.461.194.705.776 455 1.303 1.976.865 1.selling and distribution cost Other operating expenses Other operating income Profit from operations Finance costs Profit before taxation Taxation Profit after taxation 18.884 19.351 ) 1.722.229 2.873 2.775.128 2.132.867.730.deposits and deferred taxation 315.034 2006-2007 864.527.421 ) (119.338 2.981.706 2.054.660.235.OPERATING AND FINANCIAL HIGHLIGHTS BALANCE SHEET Property.675 274.485 1.476 699.528 ) 911.632.323.304.773 1. 50 41 5 11.74 689.47 1:99 0.restated Break-up value .301 140 15 36.00 371. plant and equipment turnover INVESTMENT MEASURES PER ORDINARY SHARE Earnings per share .008.restated Operating profit to sales .50 36 3 16.00 470.1:1 1.restated Post tax profit to sales .738 100 25 19.9:1 1.Cash Dividend .06 67.25 24.09 113.47 0:100 0.8:1 1.Bonus shares Rs Rs % % times Rs Rs Rs Rs Rs in Mn % % 36.3:1 2.OPERATING AND FINANCIAL HIGHLIGHTS-CONTINUED 2010-2011 FINANCIAL RATIOS RATE OF RETURN Pre tax return on equity Post tax return on equity Return on average capital employed Interest cover PROFITABILITY Gross profit margin .55 54.55 1:99 0.74 11.47 261.82 138.restated LIQUIDITY Current Ratio Quick ratio FINANCIAL GEARING Debt equity ratio Gearing ratio CAPITAL EFFICIENCY Debtors turnover Inventory turnover Total assets turnover Property.99 586.79 19.8:0 2.00 10.restated Pre tax profit to sales .525 135 15 23.930 160 25 days days times times 8 67 2 5 10 58 2 6 11 46 3 9 9 65 2 7 9 63 2 7 8 62 2 7 ratio times 0:100 0.45 556.00 8.5:1 2.50 10.2:1 1.90 280.845 115 15 21.18 769.5:1 1.79 16.restated Dividend cash (including proposed) Dividend payout (including bonus) Dividend yield Price earning ratio .26 658.0:1 % % % % 29 13 13 8 33 15 15 10 25 11 10 7 30 14 14 9 32 15 15 10 33 15 15 10 % % % times 41 27 27 151 49 32 35 161 42 28 29 24 48 32 33 52 53 35 37 62 59 38 40 59 2009-2010 2008-2009 2007-2008 2006-2007 2005-2006 59 .12 175.34 0:100 0.restated Market value .00 57 5 21.79 430 825 624.45 13.00 47 4 24.91 41.00 35 2 29.23 277.6:1 1.40 18.14 16.01 1.63 ratio ratio 2.848 160 25 15.high Market value .04 325.79 85.2:1 0.15 346.46 0:100 0.5:1 2.00 14.year end Market capitalization -restated Dividend .low Market value .00 480.95 14 42 2 20. Signed this Folio No. Address Notes: 1. of Shares held Signature over Revenue Stamp Witness 1 Signature Name CNIC No. 4. If a proxy is granted by a member who has deposited his/her shares in Central Depository Company of Pakistan Limited. day of CDC Participant ID No. The instrument of Proxy properly completed should be deposited at the Registered Office of the Company not less that 48 hours before the time of the meeting. 3. the proxy must be accompanied with participants ID number and CDC account/sub-account number alongwith attested photocopies of Computerized National Identity Card (CNIC) or the Passport of the beneficial owner. The signature must tally with the specimen signature/s registered with the Company. 2011. 2. The proxy must be a member of the Company.FORM OF PROXY I/We of a member of COLGATE-PALMOLIVE (PAKISTAN) LIMITED hereby appoint of or failing him of who is/are also member/s of Colgate-Palmolive (Pakistan) Limited to act as my/our proxy and to vote for me/us and on my/our behalf at the Annual General Meeting of the shareholders of the Company to be held on the 12th day of September 2011 and at any adjournment thereof. No. Representatives of corporate members should bring the usual documents required for such purpose. . Address Witness 2 Signature Name CNIC No. CDC Account/ Sub-Account No. Sarwar Shaheed Road. Karachi. Building No. 2. Phone: 35698000 Fold Here Fold Here Fold Here Fold Here Fold Here .Fold Here AFFIX CORRECT POSTAGE Company Secretary COLGATE-PALMOLIVE (PAKISTAN) LIMITED Lakson Square.74200.