GRAYS OF CAMBRIDGE (PAKISTAN) LIMITEDgocpak.com/download/310312.pdf · The sales for the nine months decreased by 28.63% to Rupees 102.014 million as against Rupees 142.928 million

GRAYS OF CAMBRIDGE (PAKISTAN) LIMITED

CONDENSED INTERIM FINANCIAL INFORMATIONFOR THE NINE MONTHS ENDED

31 MARCH 2012(UN-AUDITED)

CORPORATE INFORMATION


CONDENSED INTERIM FINANCIAL INFORMATION



03

DIRECTORS’ REPORT

Sialkot: 26 April 2012 Khawar Anwar Khawaja

Chief Executive

For and on behalf of the Board

It gives me great pleasure to present, on behalf of the Board of Directors, the condensed interim financial information (un-audited) for the quarter and nine months ended 31 March 2012.

The sales for the nine months decreased by 28.63% to Rupees 102.014 million as against Rupees 142.928 million for the corresponding period. It is due to decrease in sales of composite sticks and cricket balls. Company earned gross profit of Rupees 23.731 million as compared to Rupees 48.437 million for the corresponding period. The loss per share increased by Rupees 0.96 to Rupees 1.12 against Rupees 0.16 for the corresponding period. The trend of decline in the sales of wooden sticks is continued because of the introduction of composite sticks and is likely to continue in future especially in the top and medium end.

The share of loss of associated company, Grays Leasing Limited, was recorded at Rupees 1.923 million against Rupees 14.152 millions for the corresponding period.

Keeping in view the present market situation the directors are satisfied with the results and express their commitment to further improve the business of the company.

The Board places on record its profound gratitude for its valued shareholders, banks and customers, whose cooperation, continued support and patronage have enabled the company to strive for constant improvement. During the period under review, relations between the management and employees remained cordial and we wish to place on record our appreciation for the dedication, perseverance and diligence of the staff and workers of the company.



04

CONDENSED INTERIM BALANCE SHEET AS AT 31 MARCH 2012

Un-audited Audited31 March 30 June

2012 2011Note Rupees Rupees

NON-CURRENT ASSETSProperty, plant and equipment 4 36,649,214 37,269,351Long term investments 5 25,869,206 28,183,889Long term placement 6 500,000 2,000,000Long term deposits 626,248 554,785

63,644,668

68,008,025

CURRENT ASSETS

Stores and spares 1,481,969

1,774,167Stock-in-trade 115,970,965

90,143,639Trade debts 8,209,118

23,150,361Current portion of long term placement 2,000,000

2,000,000Advances 10,033,287

16,765,058Trade deposits and short term prepayments 636,210

314,303Other receivables 4,857,693

5,191,178Cash and bank balances 4,443,014

5,366,650147,632,256

144,705,356

CURRENT LIABILITIES

Trade and other payables 31,722,952

23,812,957Accrued mark-up 194,148

-Short term borrowing 7 7,000,000

-Provision for taxation 1,500,927

2,490,23840,418,027

26,303,195NET ASSETS 170,858,897

186,410,186

REPRESENTED BY:Share capital and reservesAuthorized share capital10,000,000 (30 June 2011:10,000,000) ordinary shares of Rupees 10 each 100,000,000

100,000,000

Issued, subscribed and paid up share capital7,349,341 (30 June 2011:7,349,341) ordinary shares of Rupees 10 each 73,493,410 73,493,410Reserves 97,365,487 112,916,776TOTAL EQUITY 170,858,897 186,410,186

Contingencies and commitments 8

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

KHAWAR ANWAR KHAWAJA MUHAMMAD TAHIR BUTT

CHIEF EXECUTIVE DIRECTOR



05

CONDENSED INTERIM PROFIT AND LOSS ACCOUNT (Un-audited)FOR THE NINE MONTHS ENDED 31 MARCH 2012



31 March 31 March 31 March 31 March2012 2011 2012 2011

Note Rupees Rupees Rupees Rupees

SALES 102,014,125 142,927,568 37,067,346 49,270,295

COST OF SALES 9 (78,283,461) (94,490,281) (25,336,422) (33,731,023)

GROSS PROFIT 23,730,664 48,437,287 11,730,924 15,539,272

DISTRIBUTION COST (13,589,142) (17,195,088) (4,887,843) (6,271,476)

ADMINISTRATIVE EXPENSES (13,778,601) (13,598,222) (4,547,664) (4,757,326)

OTHER OPERATING EXPENSES (1,124,466)

(2,938,866)

(373,961) (1,731,304)

(28,492,209) (33,732,176) (9,809,468) (12,760,106)

(4,761,545) 14,705,111 1,921,456 2,779,166

OTHER OPERATING INCOME 768,253 939,855 170,486 113,816

PROFIT / (LOSS) FROM OPERATIONS (3,993,292) 15,644,966 2,091,942 2,892,982

FINANCE COST (526,482) (420,787) (308,566) (136,536)

(4,519,774) 15,224,179 1,783,376 2,756,446

SHARE OF PROFT / (LOSS) OF ASSOCIATE (1,923,315)

(14,152,505)

1,894,423 (1,548,027)

PROFIT / (LOSS) BEFORE TAXATION (6,443,089) 1,071,674 3,677,799 1,208,419

PROVISION FOR TAXATION

-Current (1,367,491) (1,827,216) (459,187) (505,055)

-Share of tax of associate (399,776) (399,083) (98,090) (107,950)

(1,767,267) (2,226,299) (557,277) (613,005)

PROFIT / (LOSS) AFTER TAXATION (8,210,356) (1,154,625) 3,120,522 595,414

EARNINGS / (LOSS) PER SHARE - BASIC AND DILUTED (1.12) (0.16) 0.42 0.08


Nine Months Ended Quarter Ended



06

CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME (Un-audited)

FOR THE NINE MONTHS ENDED 31 MARCH 2012




Rupees Rupees Rupees Rupees

PROFIT / (LOSS) AFTER TAXATION (8,210,356)

(1,154,625)

3,120,522 595,414

OTHER COMPREHENSIVE INCOME

8,408

(24,826)

(23,482) (23,954)

TOTAL COMPREHENSIVE INCOME / (LOSS) FOR THE PERIOD (8,201,948) (1,179,451) 3,097,040 571,460


Surplus / (deficit) arising on re-measurement of available for sale investment

Quarter EndedNine Months Ended



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08

CONDENSED INTERIM CASH FLOW STATEMENT (Un-audited) FOR THE NINE MONTHS ENDED 31 MARCH 2012

31 March 31 March2012 2011

CASH FLOWS FROM OPERATING ACTIVITIES Rupees Rupees

Profit / (Loss) before taxation (6,443,089) 1,071,674Adjustment for:

Depreciation on property, plant and equipment 2,973,182 3,328,489Profit on placement and deposit accounts (614,703) (937,105)Dividend income (7,219) (2,750)Share of loss in associated company 1,923,315 14,152,505(Gain) / loss on disposal of property, plant and equipment (146,331) 773Finance cost 526,482

420,787

4,654,726

16,962,699

Cash (used in) / generated from operating activities before working capital changes (1,788,363)

18,034,373

Decrease / (increase) in current assetsStores and spares 292,198

(436,814)Stock in trade (25,827,326)

(15,842,509)Trade debts 14,941,243

7,498,282Advances 5,818,705

256,456Trade deposits and short term prepayments (321,907)

(285,856)Other receivables 278,231

829,168

(4,818,856)

(7,981,273)Increase in current liabilities

Trade and other payables 8,491,255

10,367,897

Cash generated from operations 1,884,036 20,420,997

Finance cost paid (332,334)

(420,787)Income tax paid (1,425,561)

(2,229,158)

Net increase in long term deposits (71,463)

-

(1,829,358)

(2,649,945)Net cash generated from operating activities 54,678

17,771,052

CASH FLOWS FROM INVESTING ACTIVITIESCapital expenditure on property, plant and equipment (2,407,139)

(4,203,058)Proceeds from disposal of property, plant and equipment 200,425

1,200Net decrease in placement 1,500,000

1,000,000

Profit on short term placement 669,957

886,371Dividend income 7,219 2,750

Net cash used in investing activities (29,538) (2,312,737)

CASH FLOWS FROM FINANCING ACTIVITIESShort term borrowing-net 7,000,000 -Dividend paid (7,948,776) (17,841,875)

Net cash used in financing activities (948,776) (17,841,875)Net decrease in cash and cash equivalents (923,636) (2,383,560)Cash and cash equivalents at the beginning of the period 5,366,650 8,241,182Cash and cash equivalents at the end of the period 4,443,014 5,857,622






09

SELECTED NOTES TO THE FINANCIAL INFORMATION (Un-audited) CONDENSED INTERIM FOR THE NINE MONTHS ENDED 31 MARCH 2012

1. THE COMPANY AND ACTIVITIES

2.

3.

3.1

3.2


2012 2011Rupees Rupees

4. PROPERTY, PLANT AND EQUIPMENT

Operating fixed assets (Note 4.1) 36,434,832 37,108,294Capital work-in-progress -Tools & Equipment 214,382 161,057

36,649,214 37,269,351

4.1 OPERATING FIXED ASSETS Opening book value 37,108,294 36,016,224Add: Cost of additions during the period / year (Note 4.1.1) 2,353,814 5,434,758

39,462,108 41,450,982

Book value of deletions during the period / year (Note 4.1.2) (54,094) (23,886)

39,408,014 41,427,096

Depreciation charge for the period / year (2,973,182) (4,318,802)Closing book value

36,434,832 37,108,294

4.1.1 Cost of additions during the period / year

Factory building on freehold land - 152,680Plant and machinery 1,591,423 2,245,394Tools and equipment 294,425 851,375Electric installations 43,712 71,984Furniture and fixtures 83,940 89,000Vehicles 68,300 1,869,900Computers 272,014 154,425

2,353,814 5,434,758

4.1.2 Book value of deletions during the period / year

Plant and machinery 17,471 -Vehicles 25,437 -Computers 11,186 23,886

54,094 23,886

Judgments and estimates made by the management in the preparation of this condensed interim financialinformation are the same as those applied to the audited annual published financial statements for the yearended 30 June 2011.

Grays of Cambridge (Pakistan) Limited was incorporated in Pakistan on June 02, 1964 as a privatecompany limited by shares under the Companies Act, 1913 ( Now Companies Ordinance, 1984) andconverted into a public limited company on April 17, 1986. The Company's shares are quoted on theKarachi and Lahore Stock Exchanges. The registered office of the company is situated at Small IndustriesEstate, Sialkot. The Company is engaged in manufacturing and sale of hockey sticks, cricket ball and otherquality sports goods.

BASIS OF PREPARATION

This condensed interim financial information is un-audited and is being submitted to shareholders asrequired by section 245 of the Companies Ordinance, 1984 and has been prepared in accordance with theInternational Accounting Standard (IAS) - 34 "Interim Financial Reporting" as applicable in Pakistan andnotified by The Securities and Exchange Commission of Pakistan (SECP). This condensed interim financialinformation should be read in conjunction with the audited annual published financial statements of theCompany for the year ended 30 June 2011.

ACCOUNTING POLICIES

The accounting policies and method of computation adopted for the preparation of this condensed interim

financial information are the same as applied in the preparation of the preceding audited annual published

financial statements of the Company for the year ended 30 June 2011.



10

SELECTED NOTES TO THE FINANCIAL INFORMATION (Un-audited)CONDENSED INTERIM FOR THE NINE MONTHS ENDED 31 MARCH 2012


2012 2011Rupees Rupees

5. LONG TERM INVESTMENTS

Under equity method (Note 5.1) 25,745,517 28,068,608Available for sale (Note 5.2) 123,689 115,281

25,869,206 28,183,889

5.1 UNDER EQUITY METHOD

GRAYS LEASING LIMITED - ASSOCIATED COMPANY7,999,999 (30 June 2011 : 7,999,999) ordinary shares of Rupees 10 each equity held 37.21% (30 June 2011: 37.21%)

Share in net assets at the beginning of the period / year 28,068,608 44,504,329

Add: Share in loss before taxation for the period / year (1,923,315) (15,816,417) Share of surplus on revaluation of building disposed of during the year - 6,452,443 Share of transfer from surplus on revaluation of buildings on account of incremental depreciation - 253,417 Share in taxation (399,776) (619,304) Share in change in surplus on revaluation of buildings - (6,705,860)

(2,323,091) (16,435,721)

Share in net assets at the end of the period / year 25,745,517 28,068,608

5.1.1

5.2 AVAILABLE FOR SALE

SITARA CHEMICAL INDUSTRIES LIMITED1,155 ordinary shares of Rupees 10 each including810 bonus shares (30 June 2011: 1,100 shares of Rupees 10 each including 755 bonus shares) 10,215 10,215Surplus on revaluation (Note 5.2.1) 113,474 105,066

123,689 115,281

5.2.1 SURPLUS ON REVALUATION

Opening balance 105,066 138,208

Surplus / (deficit) on re-measurement of available for sale investment 8,408 (33,142)

113,474 105,066

6. LONG TERM PLACEMENTKASB Bank Limited 2,500,000 4,000,000Current portion shown under current assets (2,000,000) (2,000,000)

500,000 2,000,000

7. SHORT TERM BORROWING

8. CONTINGENCIES AND COMMITMENTSContingencies:

Post dated cheques issued to the Custom Authorities 7,172,500 6,912,500Bank guarantee given to the Custom Authorities 50,000 50,000

7,222,500 6,962,500

Commitments Nil Nil

Investments in associated company has been tested for impairment under IAS 36 'Impairment of Assets'. The financial statements / condensed interim financial

information of the investee company have not been prepared on going concern basis. Break up value per share of the investee company comes to Rupees 3.22 as on

31 March 2012 based on historical cost convention. Whereas, value per share is Rupees 6.74 on the basis of estimated realizable (settlement) values of assets andliabilities respectively of the investee company. The reason for difference in value per share calculated on the basis of two different accounting conventions is the factthat potential lease losses is recognized under historical cost convention on the basis of time based criteria prescribed by Securities and Exchange Commission of

Pakistan. Whereas, under the other accounting convention, potential lease losses against finance lease receivables is made by the investee company based on

estimated realizable value of the lease portfolio. Hence the management believes that the recoverable amount of investment in equity method accounted for

associated company is higher than its carrying value and resultantly no impairment loss has been incorporated in this condensed interim financial information.

This represents Export Refinance Part-II facility obtained during the period from Habib Metropolitan Bank Limited carrying interest at the rate of 11% per annum and secured against personal guarantees of the directors of the Company.



11

SELECTED NOTES TO THE FINANCIAL INFORMATION (Un-audited)CONDENSED INTERIM FOR THE NINE MONTHS ENDED 31 MARCH 2011




Rupees Rupees Rupees Rupees9. COST OF SALES

Raw materials consumed 60,865,632 65,905,642 18,570,496 23,513,897

Salaries, wages and other benefits 26,915,616 26,417,708 9,130,540 9,155,578

Stores and spare consumed 686,280 543,156 317,093 257,355

Repair and maintenance 1,893,129 1,470,536 703,991 532,068

Fuel and power 5,089,136 3,983,846 2,104,671 1,576,430

Vehicles running 515,783 401,395 203,330 151,763

Insurance 681,558 534,582 225,534 175,968

Other factory overheads 206,249 153,303 71,075 48,505

Depreciation 1,916,919 2,064,319 657,341 719,171

98,770,302 101,474,487 31,984,071 36,130,735 Work - in - process:

Opening Inventory 49,862,722

52,671,133

56,404,884 54,085,300

Closing Inventory (58,287,118)

(57,235,172)

(58,287,118) (57,235,172)

(8,424,396)

(4,564,039)

(1,882,234) (3,149,872)

Cost of goods manufactured 90,345,906

96,910,448

30,101,837 32,980,863

Finished goods :

Opening Inventory 15,796,641

10,143,064

23,093,671 13,313,391

Closing Inventory (27,859,086)

(12,563,231)

(27,859,086) (12,563,231)

(12,062,445)

(2,420,167)

(4,765,415) 750,160

78,283,461

94,490,281

25,336,422 33,731,023

10. TRANSACTIONS WITH RELATED PARTIES

31 March 31 March2012 2011

Associated companiesSale of goods 52.371 65.786

Purchases of goods 0.035 -

OthersKey management personnel 5.322 4.516

Contribution to provident fund 0.717 0.645

11. FINANCIAL RISK MANAGEMENT

12. AUTHORIZATION FOR ISSUE

13. CORRESPONDING FIGURES

This condensed interim financial information was approved by the Board of Directors and authorized for issue on 26 April 2012.

Un-audited

There are no material reclassifications of comparative figures.

(Rupees in Million)

Nine Months Ended Quarter Ended

Nine Months Ended

Transactions and contracts with the related parties are carried out at arm's length prices determined in accordance with comparable uncontrolled

price method except in circumstances where it is in the interest of the company to do so with prior approval of the Board of Directors.

The related parties comprise associated companies, directors of the company, key management personnel and staff retirement fund. Detail of

transactions with the related parties is as follows:

Un-audited

The Company's financial risk management objectives and policies are consistent with those disclosed in the preceding audited annual

published financial statements of the Company for the year ended 30 June 2011.

BOOK POST

UNDERPOSTAL

CERTIFICATE

If undelivered please return to:

GRAYS OF CAMBRIDGE (PAKISTAN) LTD.Small Industries Estate, Sialkot 51310E-mail: [email protected], [email protected]: (052) 3563051 3563052Fax: (052) 3551252

Documents

GRAYS OF CAMBRIDGE (PAKISTAN) LIMITEDgocpak.com/download/310312.pdf · The sales for the nine months decreased by 28.63% to Rupees 102.014 million as against Rupees 142.928 million