3rd quarter report 2016 - Din...

CONTENTS CONTENTS

Corporate Information

Directors’ Report

Condensed Interim Balance Sheet

Condensed Interim Profit & Loss Account

Condensed Interim Statement of Comprehensive Income

Condensed Interim Statement of Cash Flow

Condensed Interim Statement of Changes in Equity

Selected Notes to the Condensed Interim Financial information

02

03

10

11

12

13

14

DIN GROUP

09

2

Board of Directors

CORPORATE INFORMATION

Company SecretaryMr. Islam Ahmed

Chief Financial OfficerMr. Shaukat Hussain Ch.

AuditorsNaveed Zafar Ashfaq Jaffery & Co.Chartered Accountants

Registered OfficeDin House, 35-A/1, Lalazar Area,

Opp: Beach Luxury Hotel, M. T. Khan Road, Karachi.

Mills

Websitewww.dingroup.com

Ba

nk

er

s

(ACA, CPFA, FPFA, CFC )

Chairman Director Chief Executive Director Director Director Director

Audit Commi�ee

Human Resource and Remunera�on Commi�ee

Shaikh Mohammad Pervez Shaikh Muhammad Tanveer Mr. Abdul Razzak

Chairman Member Member

Chairman Member Member

Shaikh Mohammad Muneer Shaikh Mohammad Pervez Shaikh Muhammad Tanveer Shaikh Mohammad Naveed Mr. Fawad Jawed Mr. Farhad Shaikh Mohammad Mr. Abdul Razzak

Mr. Abdul Razzak Shaikh Mohammad Pervez Mr. Farhad Shaikh Mohammad

Unit-I and II: Kot Akbar Khan, 70 Km Multan Road, Tehsil Pattoki, District Kasur, Punjab. Unit-III: Revenue Estate, Bhai Kot, Tablighi Chowk, Raiwind Road, Tehsil and Distt. Lahore - Punjab. Unit-IV: Dars Road,off Raiwind Manga Road, Bachuki Majha Distt.Kasur.

Allied Bank Ltd.

Bank Alfalah Limited Islamic

Bank Al-Habib Ltd.

Dubai Islamic Bank Pakistan Ltd.

Faysal Bank Ltd.

Habib Bank Ltd.

Habib Metropolitan Bank Ltd.

MCB Bank Ltd.

Meezan Bank Ltd.

National Bank of Pakistan

Standard Chartered Bank (Pakistan) Ltd.

The Bank of Punjab

3

Dear shareholders

Financial Results

DIRECTORS’ REPORT

General Market Conditions

31-Mar-16 Inc. / (Dec.) % age

Rupees in ‘000’Rupees in ‘000’Rupees in ‘000’Rupees in ‘000’PercentagePercentageRupees

Nine Months Ended

31-Mar-15

Sales Gross Profit Pre-tax Profit / (Loss) After Tax Profit / (Loss) Gross Profit After Tax Profit / (Loss) Earning / (Loss) per share

Pakistan has the inherent advantage of being the 4th largest producer of cotton in the world with a huge potential to further increase crop yield. The domestic availability of basic raw material is considered to be an added advantage for the success of any export led industry. In this context, Pakistan ranks as 3rd in the world in the field of yarn production. Pakistan is amongst the largest producers of cotton, with large spinning capacity in Asia. In fact Pakistan contributes 5% to the global spinning capacity after China and India. China and India are producing both cotton and MMF yarns and fabrics at comparatively lower energy cost. On the other hand, the textile industry in Pakistan is facing the highest energy cost in the region. One of the key issues which are affecting the economy of our country adversely is the terrorism and the lack of international investment. In fact terrorism is the main cause which has destructed the economy as due to fear of terrorism the international investors are avoiding any further investment in Pakistan even they are pulling those previous investment back, as Pakistan is a country who is fighting against terrorism so paying the cost for it. The national industries are also in horrible condition as the energy crises has also forced thousands of industries to shut down and the one who are

The Board of directors take great privilege to present the un-audited financial statements of the company along with observation on the performance of the company for the 3rd quarter ended March 31,2016. These statements have been prepared in compliance with IAS-34 and are being submitted under section 245 of The Companies Ordinance 1984.

During the 3rd quarter ended under review, your company has shown upward trend as compare to previous 3rd quarter ended:

5,740,374 493,265 165,263 100,196

8.59 1.75 4.47

6,610,072 292,445 (174,866) (275,435)

4.42 (4.17) (12.28)

(13) 69 195 136

The financial performance of the company during the 3rd quarter ended are shown upward although factors involve in shape of interrupted of power and gas. Competitive cotton prices and better marketing factors by the directors and all staff members have borne fruit.

4

still fighting against it are faced for downsizing and against it leaves thousand of people either unemployment or forced to leave their jobs.

The overall economic situation of Pakistan is under severe pressure like energy crises, heavy rain fall ,floods, continued economic, volatility, accelerating inflationary and the on going security law and order situation. Absence of exclusive areas dedicated to textiles production, energy has emerged as a major issue especially in the Punjab where approximately 65% of the industrial units are located. Skilled manpower is also significantly deficient with the result that the sector is suffering from low per capita productivity. The physical and institutional infrastructure, especially at sea and dry ports, requires revamping and reform. Likewise, numerous parallel and overlapping regulations add to management and production costs.

Chinese policies remain the biggest factor influencing international cotton prices. The Chinese government has procured up to 88% of this year’s production for the state cotton reserve, while Chinese cotton ending inventory is expected to increase to 42.6mn bales (125% of current year production) by the end of the current marketing year. The purchase of cotton for the Chinese state reserve has reduced the availability of cotton in the open market, where it was expected that Chinese textile mills would meet cotton requirements from government stockpiles. However, cotton made available through auction from the stockpiles was of low quality, where higher quality int’l cotton was available at roughly the same price. This drove demand for cotton imports by Chinese textile mills. In the absence of higher quality cotton being made available from the state reserves demand for int’l cotton is likely to continue supporting cotton prices. However, we could see a change in this dynamic if the Chinese Government starts making higher quality cotton available. The company will continue in streamlining our operation and further strengthen our focus on the positively enhancing the quality of life of the people of Pakistan through our people, product and planet and creating shared valued activities. Despite the challenges being faced on the country your company management is well aware of the challenges that are ahead and focusing on value added products to deal with the ongoing crises and will be making all efforts to ensure continue growth ,operational efficiency and optimal results for the company and its valued stakeholders in the days to come. We pray to God that all Muslims around the world especially Pakistani will be safe from any unsharpened seen in form of Terrorism, natural disaster , political issues etc. and Pakistan is now its path to progress. We will get benefit of all up coming project from road to energy and Insha Allah Pakistan will be achieved their goals in coming years.

The Board of directors would like to place on record their appreciation to the all our stakeholders for the loyalty they have shown us during these difficult times. We

Acknowledgment

Future Outlook

5

Karachi:

Dated :April 23, 2016

On behalf of the Board of Directors

SHAIKH MUHAMMAD TANVEER

Chief Executive

acknowledge the cooperation, support and loyalty of our employee, banks, shareholders, various governments bodies and board of directors. The company looks toward your continuous support as always to help us navigate through difficult economic conditions both locally and internationally.

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DIN TEXTILE MILLS LTD.

ACCOUNTS Financial Statements (Un-Audited)

3rd Quarter Ended March 31, 2016


9

(Amounts in Thousand)

Note 31-Mar-16 30-Jun-15

Rupees Rupees

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

5

7

6

NON CURRENT ASSETS

Property, plant and equipment

Long term deposits

Deferred tax assets

CURRENT ASSETS

Stores, spare parts and loose tools

Stock in trade

Trade debts

Loans and advances

Trade deposits and short term prepayments

Other receivables

CURRENT LIABILITIES

Trade and other payables

Accrued mark up / interest

Short term borrowings

Current portion of

Long term financing from banking companies - secured

Liabilities against assets subject to finance lease

WORKING CAPITAL

TOTAL CAPITAL EMPLOYED

NON CURRENT LIABILITIES

Long term financing from banking companies - secured Liabilities against assets subject to finance lease Deferred liabilities Staff retirement benefits - gratuity

CONTINGENCIES AND COMMITMENTS

Net Worth

Authorized capital

Net Worth Represented by: Issued, subscribed and paid up capital

Reserves

Condensed Interim Balance Sheet (Un-Audited) as at March 31, 2016

Karachi:Dated : April 23, 2016

SHAIKH MOHAMMAD MUNEER SHAIKH MUHAMMAD TANVEERChief Executive Chairman

EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES

8

Audited

77,100,000 ordinary shares of Rs. 10/- each

22,421,688 ordinary shares of Rs. 10/- each

Un-Audited

Tax refunds due from the Government

Cash and bank balances

771,000

2,651,988

14,965

76,947

2,743,900

262,740

1,489,054

914,777

162,923

1,644

52,499

502,240

33,507

3,419,384

2,807,113

69,601

229,057

431,809

3,343

3,540,923

(121,539)

2,622,361

695,319 3,043

102,172

800,534

1,821,827

771,000

224,217

1,597,610

1,821,827

2,611,547

14,943

102,944

2,729,434

224,443

1,166,746

866,157

34,648

1,540

38,309

480,752

36,720

2,849,315

1,554,288

39,760

963,952

322,464

4,166

2,884,630

(35,315)

2,694,119

865,601 2,805

104,081

972,487

1,721,632

224,217

1,497,415

1,721,632

10

(Amounts in Thousand except earning / (loss) per share)

31-Mar-16 Rupees

Condensed Interim Profit and Loss Account (Un-audited) For the quarter and 3rd quarter ended March 31, 2016

Nine Months Ended Quarter Ended

Note

9

31-Mar-15 Rupees

31-Mar-15 Rupees

31-Mar-16 Rupees

Sales

Cost of sales

Gross Profit

Distribution cost

Administrative expenses

Other operating expenses

Finance cost

Other operating income

Profit / (Loss) before taxation

Provision for taxation

Profit / (Loss) for the period

Earning / (Loss) per share-basic and diluted-Rupee per share

5,740,374

(5,247,109)

493,265

(41,755)

(94,609)

(8,870)

(182,808)

(328,042)

165,223

40

165,263

(65,067)

100,196

4.47

6,610,072

(6,317,627)

292,445

(71,246)

(103,319)

(107)

(293,984)

(468,656)

(176,211)

1,345

(174,866)

(100,569)

(275,435)

(12.28)

2,048,256

(1,849,682)

198,574

(14,363)

(31,170)

(4,003)

(72,976)

(122,512)

76,062

2

76,064

(35,708)

40,356

1.80

1,964,505

(1,887,353)

77,152

(21,733)

(35,942)

11

(93,622)

(151,286)

(74,134)

(334)

(74,468)

(2,778)

(77,246)

(3.45)




11


Condensed Interim Statement of Comprehensive Income (Un-Audited) For the quarter and 3rd quarter ended March 31, 2016

31-Mar-16 Rupees

Nine Months Ended Quarter Ended

31-Mar-15 Rupees

31-Mar-15 Rupees

31-Mar-16 Rupees

Profit / (Loss) for the period

Items that will be subsequently reclassified to profit and loss account

Available for sale investments

Unrealized gain on remeasurement of available for sale investments

Reclassification adjustments relating to gain realized on disposal of available for sale investments

Total comprehensive Income / (Loss) for the period

100,196

100,196

-

-

-

(275,435)

2

(14)

(12)

(275,447)

- -

- -

- -

40,356

40,356

(77,246)

(77,246)




31-Mar-16 Rupees


Rupees

Condensed Interim Cash Flow Statement (Un-Audited) for the 3rd quarter ended March 31, 2016

12

31-Mar-15

CASH FLOWS FROM OPERATING ACTIVITIES

Profit / (Loss) before taxation

Adjustments for

Depreciation

Staff retirement benefits - gratuity

Workers' profit participation fund

Finance cost

Profit before working capital changes

(Increase) / Decrease in current assets

Stores, spare parts and loose tools

Stock in trade Trade debts Loans and advances Trade deposits and short term prepayments

Other receivables Other financial assets

Increase / (Decrease) in current liabilities

Trade and other payables

Cash generated from operations

Finance cost paid

Taxes paid

Dividend paid

Workers' profit participation fund paid

Staff retirement benefits - gratuity paid

Net cash generated from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from sale of property, plant and equipment

Fixed capital expenditure

Long term deposits

Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Long term financing

Liabilities against assets subject to finance lease

Net cash (used in) / generated from financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents at the beginning of the period

Cash and cash equivalents at the end of the period

CASH AND CASH EQUIVALENTS

Cash and bank balances

Short term borrowings

(Gain) on disposal of available for sale investments

Loss / (Gain) on disposal of property, plant and equipment

165,263

195,726

31,230

8,698

182,808 -

139

418,601

583,864

(38,297) (322,308)

(48,620) (128,275)

-

(14,190) -

(551,690)

1,242,900

1,275,074

(152,966)

(58,967)

(365) -

(33,139)

1,029,637

2,870

(239,177)

(126)

(236,433)

(60,937)

(585)

(61,522)

731,682

(927,232)

(195,550)

33,507

(229,057)

(195,550)

(174,866)

175,561

28,569

-

293,984 (36)

(714)

497,364

322,498

151,183 (67,836)

270,102 (4,796)

4,229

(451)

108

352,539

(15,557)

659,480

(259,191)

(153,519)

(86)

(661)

(41,779)

204,244

1,651

(171,820)

3,485

(166,684)

243,525

(18,001)

225,524

263,084

(686,833)

(423,749)

6,944

(430,693)

(423,749)




13


ParticularsUnappropriated

profit

Sub total

General

Total

Rupees

Share capital

Condensed Interim Statement of Changes in Equity (Un-Audited)

for the 3rd quarter ended March 31, 2016

Balance as at July 01, 2014

Total comprehensive loss for the

3rd quarter ended March 31, 2015

Balance as at March 31, 2015

Balance as at July 01, 2015

Total comprehensive Income for the

3rd quarter ended March 31, 2016

Balance as at March 31, 2016

Revenue

Reserves

1,281,230

(275,447)

1,005,783

1,097,414

100,196

1,197,610

224,217

-

224,217

224,217

-

224,217

400,000

-

400,000

400,000

400,000

1,681,230

(275,447)

1,405,783

1,497,414

100,196

1,597,610

1,905,447

(275,447)

1,630,000

1,721,631

100,196

1,821,827




-

Selected Notes to the Condense Interim Financial Information (Un-Audited) for the 3rd quarter ended March 31, 2016

LEGAL STATUS AND NATURE OF BUSINESS The company is limited by shares, incorporated in Pakistan on June 13, 1988 and were previously quoted on stock exchanges at Karachi and Lahore. However, due to integration of these stock exchanges into Pakistan Stock Exchange effective January 11, 2016, the shares of the company are now quoted on Pakistan Stock Exchange. The registered office of the company is situated at 35-A/1, Lalazar area, opposite Beach Luxury Hotel, M. T. Khan road, Karachi in the province of Sind, Pakistan.

The principal business of the company is to manufacture and sale of yarn. The manufacturing units are located at Pattoki and Raiwind in the province of Punjab.

BASIS OF PREPARATION Statement of compliance

This condensed interim financial information is un-audited and has been prepared in accordance with the requirements of the International Financial Reporting Standard (IFRS) IAS 34 "Interim Financial Reporting" as applicable in Pakistan. This condensed interim financial information does not include all of the information and disclosures required for annual financial statements, and should be read in conjunction with the financial statements of the company as at and for the year ended June 30, 2015.

These condensed interim financial information are being submitted to the shareholders as required by the Listing regulations of Karachi and Lahore Stock Exchange and section 245 of the Companies Ordinance, 1984.

These condensed interim financial statements comprise of condensed interim balance sheet, condensed interim profit and loss account, condensed interim statement of comprehensive income, condensed interim cash flow statement and condensed interim statement of changes in equity together with the selected notes for the 3rd Quarter ended March 31, 2016 which have not been audited. These condensed interim financial statements also include condensed interim profit and loss, condensed interim statement of other comprehensive income for the quarter ended March 31, 2016.

SIGNIFICANT ACCOUNTING POLICIES

Accounting policies and methods of computation which have been used in the preparation of these condensed interim financial information are the same as those applied in preparation of the financial statements for the preceding year ended June 30, 2015.

1

1.1

1.2

2

2.1

14

3

3.1

15

3.2

4

31-Mar-16 30-Jun-15

4.1

(Un-Audited) (Audited)

PROPERTY, PLANT AND EQUIPMENT 5

Operating assets

Capital work in progress - at cost

5.1

5.2

-----------Rupees in '000'-----------

Amendments to certain existing standards and new interpretations on approved accounting standards effective during the period either were not relevant to the company's operations or did not have any impact on the accounting policies of the company.

ACCOUNTING ESTIMATES, JUDGEMENTS AND FINANCIAL RISK MANAGEMENT

The preparation of these condensed interim financial information in conformity with approved accounting standards requires management to make estimates, assumptions and use judgements that affect the application of policies and reported amounts of assets and liabilities and income and expenses. Estimates, assumptions and judgements are continually evaluated and are based on historical experience and other factors, including reasonable expectations of future events. Revisions to accounting estimates are recognized prospectively commencing from the period of revision.

Judgements and estimates made by management in the preparation of these condensed interim financial information are the same as those that were applied to the financial statements as at and for the year ended June 30, 2015.

The Company's financial risk management objectives and policies are consistent with those disclosed in the financial statements as at and for the year ended June 30, 2015.

4.2

2,641,625

10,363

2,651,988

2,603,759

7,788

2,611,547

Note

16

STOCK IN TRADE

Finished goods amounting to Rs. 88.167 million (June 30, 2015 : Rs. 53.115 million) stated at their net realizable value aggregating Rs.83.924 million (June 30, 2015 : Rs. 49.119 million). The amount charged to profit and loss in respect of stocks written down to their net realizable value is Rs. 4.243 million (June 30, 2015 : Rs. 3.996 million).

CONTINGENCIES AND COMMITMENTS

There has been no significant change in the contingencies and commitments since the last audited financial statements except as disclosed in note 7.1, 7.2 and 7.3 respectively.

The Company has issued post dated cheques amounting to Rs. 143.61 million (June 30, 2015: Rs. 94.95 million) in favor of Collector of Customs in lieu of

6

6.1

7

7.1

5.1

31-Mar-16 31-Mar-15Acquisition Disposal

Cost-----------Rupees in '000'-----------

Acquisition DisposalCost

-----------Rupees in '000'-----------

The cost of additions and deletions to property, plant and equipment during the 3rd quarter ended were as follows.

Owned Assets

Plant and machinery

Electric installation

Tools and equipment

Furniture and fixture

Office equipment

Computers

Vehicles

Leased Assets

Vehicles

5.2 CAPITAL WORK IN PROGRESS (Un-audited) (Audited)

31-Mar-16

30-Jun-15-------------Rupees in’000’------------

Building

Plant and machinery

Electric Installation

222,543

10,188

-

843

331

400

64

2,233

236,602

3,650

-

-

467

-

-

2,934

-

7,051

94,327

406

25

780

-

194

2,654

-

98,386

675

-

-

-

-

1,270

3,321

-

5,266

219

847

9,297

10,363

-

-

7,788

7,788

17

custom levies against various statutory notification. The indemnity bonds furnished by the company are likely to be released after the fulfillment of term of related SROs.

8 ISSUED, SUBSCRIBED AND PAID UP CAPITAL

7.2

7.3

Contingencies

Bills discounted with recourse

Bank guarantees issued in ordinary course of business

Commitments

Letters of credit for capital expenditure

Letter of credit for raw material

Letter of credit for stores and spares

-------------Rupees in’000’------------

(Un-audited) (Audited)

31-Mar-16 30-Jun-15

-------------Rupees in’000’------------


31-Mar-16 30-Jun-15 Number of Shares

31-Mar-16 30-Jun-15

124,864

148,911

97,374

61,332

72,842

13,479,600

1,962,334

6,979,754

22,421,688

Ordinary shares of Rs. 10 each allotted for consideration paid in cash

Ordinary shares of Rs. 10 each allotted for consideration of amalgamation of power plant

Ordinary shares of Rs. 10 each allotted as fully paid bonus shares

13,479,600

1,962,334

6,979,754

22,421,688

134,796

19,623

69,798

224,217

134,796

19,623

69,798

224,217

Associated company (Din Leather (Pvt.) Limited) held 7,260 (June 30, 2014 : 7,260) ordinary shares of the company. The shareholders' are entitled to receive all distributions to them including dividend and other entitlements in the form of bonus and right shares as and when declared by the company. All shares carry "one vote" per share withoutrestriction.

8.1

8.2

346,177

168,911

343,691

90,637

10,655

224,217

18

9

9.1

10

Nine Months ended Quarter ended

EARNING / (LOSS) PER SHARE-BASIC AND DILUTE-RUPEE PER SHARE

Profit / (Loss)for the period

Weighted average number of ordinary shares outstanding during the period

Earning / (Loss) per share - basic and diluted - Rupee per share

There is no dilutive effect on the basic earning per share of the company.

(Un-audited)

-------------Rupees in’000’------------

(Un-audited)

Transactions with related parties

MCB Bank Limited

Deposits

Withdrawals

Din Farm Product (Pvt) Limited

Relationship

Associated company

Associated company

31-Mar-16

Salaries and other employees benefits

Staff retirement benefits

Key management personnel

Key management personnel

31-Mar-15 Rupees

31-Mar-16 Rupees

31-Mar-16 Rupees

31-Mar-15 Rupees

31-Mar-15

TRANSACTIONS WITH RELATED PARTIES

Din Leather (Pvt) Limited

Associated company

Reimbursment of Expenses

---------------------Rupees in’000’---------------------

100,196

22,421,688

4.47

(275,435)

22,421,688

(12.28)

40,356

22,421,688

1.80

(77,246)

22,421,688

(3.45)

Din Industries Ltd.


Sale of Fixed


12 253

329

1,018

307

467

84,156

5,705

247,778 269,209

30

1,128

-

57,958

2,692

-

Associated company

19


-------------Rupees in’000’------------

31-Mar-16 30-Jun-15

Balances outstanding at the period end

11 DATE OF AUTHORIZATION FOR ISSUE

These condensed interim financial information have been authorized for issue on April 23, 2016 by the board of directors of the company.

GENERAL

Figures have been rounded off to the nearest thousand rupees.

12



MCB Bank Limited Din Farm Products (Pvt) Ltd . Din Industries Ltd .

984 - 196

1,254 - -


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