First Quarter Ended March 2011 - tripack.com.pk

First Quarter EndedMarch 2011

02 Company Information

03 Directors’ Report to the Shareholders

04 Balance Sheet

06 Profit and Loss Account

07 Statement of Changes in Equity

08 Cash Flow Statement

09 Notes to and Forming Part of the Financial Statements

Contents

Board of DirectorsSyed Babar Ali (Chairman)Shahid Hussain (Chief Executive)Khalid YacobKimihide AndoFaisal FaridSyed Hyder AliTetsuo Obana

Audit CommitteeKhalid Yacob (Chairman)Kimihide AndoFaisal FaridTetsuo Obana

Company SecretaryAdi J. Cawasji

Chief Financial OfficerAmjad Ali

Auditors and Tax AdvisorA. F. Ferguson & Co.Chartered Accountants

Legal AdvisorSattar & SattarKhan & Paracha

Websitewww.tripack.com.pk

Registered Office4th Floor, The Forum,Suite No. 416-422,G-20, Block No. 9, Clifton,Khayaban-e-Jami,Karachi - 75600, Pakistan.Tel: (021) 35874047-49

(021) 35831618Fax: (021) 35860251

BankersAskari Bank Limited

Bank Alfalah LimitedBank Al-Habib LimitedBank Islami Pakistan LimitedBarclays Bank PLC, PakistanCitibank N.A.Deutsche Bank A.G.Faysal Bank LimitedHabib Bank LimitedHSBC Bank Middle East LimitedMCB Bank LimitedMeezan Bank LimitedNIB Bank LimitedStandard Chartered Bank LimitedThe Bank of KhyberThe Bank of Tokyo-Mitsubishi UFJ, Ltd.

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

Works & Sales OfficeHattarPlot No. 78/1, Phase IV,Hattar Industrial Estate,Hattar, Khyber Pakhtunkhwa,(Formerly N.W.F.P.).Tel: (0995) 617406-7Fax: (0995) 617054

Regional Sales OfficesKarachi101-106, Marine Pride, Block 7,Clifton, Karachi - 75600.Tel: (021) 35871801-2Fax: (021) 35871803

LahoreB-70/1, Gulberg III, Behind KFC,MM Alam Road, Lahore.Tel: (042) 35716068-70Fax: (042) 35873659

Company Information

Tri-Pack Films Limited Quarterly Report 201102

Directors’ Report to the Shareholders

Growth is in our Nature 03

The Directors are pleased to present quarterly report and un-audited financialstatements of the Company for the quarter ended March 31, 2011.

Financial Performance

By the Grace of Almighty, your Company registered a substantial growth in its salesand net profit during the period under review. We successfully managed tough businessconditions in the country, as well as, adverse effects of increase in crude oil prices inthe international market.

Comparison of the financial results with the corresponding period of 2010 is as follows:

1st Quarter2011 2010

Sales Volume - (M. Tonnes) 9,545 8,573Sales Value - (Million Rs) 2,390 1,719Gross Profit - (Million Rs) 442 239Net profit - (Million Rs) 192 87EPS - (Rs per share) 6.41 2.91

The net sales during the 1st quarter 2011 registered a remarkable increase of 39percent over the same period last year. Net profit during the 1st quarter is Rs. 192million as compared to Rs. 87 million for the same period last year. This has been theresult of efficient operations, management team work, consistent efforts of our staff,and successful marketing strategies.

Future Outlook

Our success lies in the continuous improvement in the operational efficiencies; deliveringquality products and services to our customers focused team work of our highlymotivated staff and promotion of high value added products. We are, therefore,confident to achieve our targets for the remaining period of 2011 despite unfavorablebusiness conditions.

Acknowledgement

The Board would like to thank our extremely valued stakeholders, whose cooperationand support plays a vital role in improving our products and services.

On behalf of the board

Shahid HussainChief Exeucutive Karachi – April 26, 2011

Condensed Interim Balance SheetAs at March 31, 2011 (Un-audited - note 2.1)


Note March 31,2011

Rs ‘000

December 31,2010

Rs ‘000

SHARE CAPITAL AND RESERVES

Authorised capital 1,000,000 1,000,000

Issued, subscribed and paid-up capital 300,000 300,000

Reserves 1,383,526 1,491,125 1,683,526 1,791,125

NON-CURRENT LIABILITIES

Long-term finances 3 312,500 375,000

DEFERRED LIABILITIES

Deferred taxation 206,000 219,508

Accumulated compensated absences 15,363 13,016

CURRENT LIABILITIES AND PROVISIONS

Trade and other payables 5 1,824,937 1,443,822

Accrued mark-up 12,375 28,401

Short - term borrowings 4 550,000 295,873

Current portion of long-term finances 3 125,000 233,000 2,512,312 2,001,096

CONTINGENCIES AND COMMITMENTS 6 4,729,701 4,399,745

PROPERTY, PLANT AND EQUIPMENT 7 1,999,532 1,853,983

INTANGIBLES 16,009 17,836

LONG-TERM DEPOSITS 1,764 1,763

CURRENT ASSETS

Stores and spares 268,778 237,119

Stock-in-trade 1,337,752 1,052,338

Trade debts 8 876,997 767,252

Advances, prepayments and other receivables 85,766 39,313

Taxation 59,200 79,931

Cash and bank balances 83,903 350,210

2,712,396 2,526,163

4,729,701 4,399,745

The annexed notes 1 to 14 form an integral part of these condensed interim financialstatements.

Note March 31,2011

Rs ‘000

December 31,2010

Rs ‘000


Condensed Interim Balance SheetAs at March 31, 2011 (Un-audited - note 2.1)

Shahid HussainChief Exeucutive

Syed Hyder AliDirector



Sales 2,935,597 2,088,113Less: sales tax and special excise duty 545,242 369,274Net sales 2,390,355 1,718,839

Cost of sales 9 1,948,584 1,480,037Gross profit 441,771 238,802

Distribution cost 54,966 32,750Administrative expenses 36,518 24,155

91,484 56,905Operating profit 350,287 181,897

Other income 6,561 9,710 356,848 191,607

Finance cost 28,778 50,966Other expenses 32,878 9,704

61,656 60,670Profit before taxation 295,192 130,937

Taxation

-Current 116,299 57,229 -Deferred (13,508) (13,522)

102,791 43,707Profit after taxation 192,401 87,230

Earnings per share - basic and diluted (Rupees) 6.41 2.91

Note: The appropriations of profits are set out in the condensed interim statement ofchanges in equity.


Condensed Interim Profit and Loss AccountFor the first quarter ended March 31, 2011 (Un-audited - note 2.1)


Note Quarter endedMarch 31,

2011Rs ‘000

Quarter endedMarch 31,

2010Rs ‘000


Condensed Interim Statement of Changes in EquityFor the first quarter ended March 31, 2011 (Un-audited - note 2.1)

Balance at January 1, 2010 300,000 831,000 465,280 1,596,280

Transfer to general reserve - 164,000 (164,000) -

Dividend relating to the year ended December 31, 2009 @ 100% - - (300,000) (300,000)

Net profit for the first quarter ended March 31, 2010 - - 87,230 87,230

Balance at March 31, 2010 300,000 995,000 88,510 1,383,510

Balance at January 1, 2011 300,000 995,000 496,125 1,791,125

Transfer to general reserve - 194,000 (194,000) -

Dividend relating to the year ended December 31, 2010 @ 100% - - (300,000) (300,000)

Net profit for the first quarter ended March 31, 2011 - - 192,401 192,401

Balance at March 31, 2011 300,000 1,189,000 194,526 1,683,526


UnappropriatedProfit

Rs ‘000 Rs ‘000

TotalGeneralReserve

Rs ‘000

ShareCapital

Rs ‘000





Condensed Interim Cash Flow StatementFor the first quarter ended March 31, 2011 (Un-audited note 2.1)


Note Quarter endedMarch 31,

2011Rs ‘000


2010Rs ‘000

CASH FLOWS FROM OPERATING ACTIVITIES

Cash generated from operations 11 36,480 241,226Payment on account of accumulated compensated absences (503) (1,303)Long-term deposits (1) -Staff retirement benefits paid (5,776) (2,939)Income taxes paid (95,568) (91,763)Net cash (outflow) / inflow from operating activities (65,368) 145,221

CASH FLOWS FROM INVESTING ACTIVITIES

Fixed capital expenditure (241,721) (6,944)Profit on bank balances received 91 110Sale proceeds on disposal of fixed assets 1,890 3,157Net cash outflow from investing activities (239,740) (3,677)

CASH FLOWS FROM FINANCING ACTIVITIES

Finance costs paid (44,804) (70,471)Long-term finance paid (170,500) (108,000)Dividend paid (22) (25)Net cash outflow from financing activities (215,326) (178,496)

Net (decrease) in cash and cash equivalents (520,434) (36,952)

Cash and cash equivalents at the beginning of the period 54,337 (376,546)

Cash and cash equivalents at the end of the period 12 (466,097) (413,498)

The annexed notes 1 to 14 form an integral part of these condensed interim financial statements.


Notes to and Forming Part of the Financial StatementsFor the first quarter ended March 31, 2011 (Un-audited - note 2.1)

1. INTRODUCTION

Tri-Pack Films Limited (the Company) was incorporated in Pakistan as a publiccompany on April 29, 1993 under the Companies Ordinance, 1984 (the Ordinance)and is listed on all the stock exchanges in Pakistan. The registered office of theCompany is situated at 4th floor, the Forum, Suite No. 416 to 422, G-20, Block-9,Khayaban-e-Jami, Clifton, Karachi.

The Company is principally engaged in the manufacture and sale of BiaxiallyOriented Polypropylene (BOPP) film and Cast Polypropylene (CPP) film.

2. BASIS OF PRESENTATION

2.1 These condensed interim financial statements of the Company for the threemonths period ended on March 31, 2011 have been prepared in accordancewith the requirements of the International Accounting Standard No. 34 'InterimFinancial Reporting' and are being submitted to the shareholders as requiredunder section 245 of the Ordinance and the listing regulations of the Karachi,Lahore and Islamabad Stock Exchanges.

The condensed interim financial statements comprise of the condensed interimbalance sheet as at March 31, 2011 and the condensed interim profit and lossaccount, condensed interim statement of changes in equity and the condensedinterim cash flow statement for the quarter ended March 31, 2011.

The comparative balance sheet presented in these condensed interim financialstatements as at December 31, 2010 has been extracted from the auditedfinancial statements of the Company for the year ended December 31, 2010whereas the comparative condensed interim profit and loss account, condensedinterim statement of changes in equity and condensed interim cash flow statementare for the quarter ended March 31, 2010.

2.2 The accounting policies adopted in the preparation of these financial statementsare the same as those applied in the preparation of the financial statements ofthe Company for the year ended December 31, 2010.



March 31,2011

Rs ‘000

December 31,2010

Rs ‘000

3. LONG-TERM FINANCES

Secured

Finance 1 - note 3.1 - 100,000Finance 2 - note 3.2 - 8,000Finance 3 - note 3.3 437,500 500,000

437,500 608,000Less: Amounts payable within twelve months shown under current liabilities 125,000 233,000

312,500 375,000

3.1 The Company had obtained a long-term finance facility of Rs 1,000 million(December 31, 2010: Rs 1,000 million) from a commercial bank under mark-uparrangements. Mark-up was payable on quarterly basis at the rate of base rateplus 1% per annum. The base rate is the simple average of last three cut-offyields of six months treasury bills of the State Bank of Pakistan. The effectiverate of mark-up during the three months was 14.39% (December 31, 2010:13.34%) per annum. The principal amount was repayable in ten equal semi-annual installments commencing after thirty months inclusive of two years graceperiod from the date of first draw down. This facility was secured by first paripassu hypothecation/mortgage charge on all of the Company's present andfuture fixed assets including but not limited to land, buildings, plant and machinery,equipment, furniture and fixtures, etc. Last installment has been paid duringMarch 2011.

3.2 The Company had obtained a long-term finance facility of Rs 100 million (December31, 2010: Rs 100 million) from a commercial bank under mark-up arrangementsout of which the Company has availed Rs 80 million (December 31, 2010: Rs80 million). Mark-up was payable on quarterly basis at the rate of three monthsKarachi Inter Bank Offer Rate (KIBOR) plus 1% per annum. The effective rate ofmark-up during the three months was 14.46% (December 31, 2010: 13.50%)per annum. The principal amount was repayable in ten equal semi-annualinstallments commencing after thirty months inclusive of two years grace periodfrom the date of first draw down. This facility was secured by first pari passuhypothecation/mortgage charge on all of the Company's present and future fixedassets including but not limited to land, buildings, plant and machinery, equipment,furniture and fixtures, etc. Last installment has been paid during March 2011.

3.3 The Company had obtained a long-term finance facility of Rs 500 million (2010:Rs 500 million) from a commercial bank under mark-up arrangements. Mark-upis payable in arrears on a semi-annual basis at the rate of six months KIBORplus 0.50 percent per annum. The effective rate of mark-up during the threemonths was 13.38% (December 31, 2010: 13.11%) per annum. The principalamount is repayable in 8 equal installments commencing after six months witha grace period of two years from the date of first draw down. The facility issecured by first pari passu hypothecation/ mortgage charges on all the Company's



March 31,2011

Rs ‘000

December 31,2010

Rs ‘000

present and future assets including but not limited to land, buildings plant andmachinery, equipment, furniture and fixture etc.

3.4 The Company has signed agreements for long term finance facilities of Rs 4,000million (2010: Rs 2000 million) from commercial banks under mark-uparrangements. Mark-up is payable in arrears on a semi-annual basis at the rateof six months Karachi Inter Bank Offer Rate (KIBOR) plus 0.75 percent perannum. The Company had not drawn down any amount under this facility uptoMarch 31, 2011. The principal amount will be repayable in 10 equal semi-annualinstallments commencing after thirty months with a grace period of two yearsfrom the date of first draw down. This facility is secured by first pari passuhypothecation / mortgage charge on all of the Company's present and futurefixed assets including but not limited to land, buildings, plant and machinery,equipment, furniture and fixtures etc.

4. SHORT-TERM FINANCES - SECURED

Short-term finances are under mark-up arrangement with banks payable onvarious maturity dates upto September 15, 2011. These facilities are securedby joint hypothecation by way of first floating charge over current assets includingbut not limited to stores and spares, stock-in-trade and trade debts. Rate ofmark-up applicable to these facilities ranges between 13.45% to 15.03%(December 31, 2010: 12.80% to 14.14%) per annum. Total facilities availableunder mark-up arrangements aggregated Rs 3,000 million (December 31, 2010:Rs 3,000 million) out of which the amount unavailed at the period end was Rs2,450 million (December 31, 2010: Rs 2,704 million).

5. TRADE AND OTHER PAYABLES

These include Rs 5.206 million (December 31, 2010: Rs 3.564 million) payable torelated parties.

6. CONTINGENCIES AND COMMITMENTS

Contingencies

Guarantees issued by banks on behalf of the Company 75,872 58,227

CommitmentsLetter of credit for purchase of raw material

and spares 947,812 956,076Letters of credit for purchase of items of

plant and machinery 1,513,267 1,557,846



March 31,2011

Rs ‘000

December 31,2010

Rs ‘000


2011Rs ‘000


2010Rs ‘000


2011Rs ‘000


2010Rs ‘000

6.1 The facilities for opening of letter of credits and for guarantees as at March 31,2011 amount to Rs 6,776 million (December 31, 2010: Rs 6,776 million) andRs 210 million (December 31, 2010: Rs 210 million), of which the amountremaining unutilized was of Rs 4,222 million (December 31, 2010: Rs 3,198million) and Rs 134.128 million (December 31, 2010: Rs 151.773 million)respectively.

7. PROPERTY, PLANT AND EQUIPMENT

Operating fixed assets - note 7.1 1,771,394 1,844,554Capital work-in-progress 228,138 9,429

1,999,532 1,853,983

7.1 Operating fixed assets

Additions 23,013 6,903

Disposals [having a net book value of Rs.1,490 million (2010: Rs 1,193)] 2,657 4,202

8. TRADE DEBTS

Considered good

These include Rs. 72.204 million (December 31, 2010: Rs 22.009 million)receivable from related parties.

9. COST OF SALES

Opening stock of finished goods 11,994 36,544Cost of goods manufactured - note 9.1 1,958,329 1,474,201Less: Closing stock of finished goods (21,739) (30,708)

1,948,584 1,480,037



Quarterended

March 31,2011

Rs ‘000

Quarterended

March 31,2010

Rs ‘000

9.1 Cost of goods manufactured

Opening stock of work-in-process 75,308 126,043

Raw materials consumed - note 9.2 1,557,387 1,153,218

Manufacturing expenses 52,046 -

Salaries, wages and other benefits 64,100 46,316

Fuel, power and water 116,858 97,283

Packing material consumed 45,666 37,485

Repairs and maintenance 28,417 20,932

Insurance 7,418 8,336

Vehicle running and maintenance 5,075 3,838

Travelling 1,611 1,395

Staff retirements benefits 6,380 4,267

Depreciation 93,159 86,232

Others 357 326

2,053,782 1,585,671

Less: Closing stock of work-in-process (95,453) (111,470)

1,958,329 1,474,201

9.2 Raw materials consumed

Opening stock 954,619 640,419

Purchases 1,929,611 1,159,249

Closing stock (1,326,843) (646,450)

1,557,387 1,153,218

Purchases of goods and servicesIGI Insurance Limited Insurance services 36,761 43,567Mitsubishi Corporation, Japan Raw material 2,319 -Packages Limited Goods and services 7,679 6,878Siemens Pakistan EngineeringCompany Limited Goods and services 3,183 3,159

49,942 53,604

Sales of goods & servicesPackages Lanka (Private) Limited Supplies - 7,034Packages Limited Supplies 225,598 115,091Tetra Pak Pakistan Limited Supplies 3,284 1,425Nestle Pakistan Limited Supplies 459 -

229,341 123,550

Purchase of an assetTetra Pak Pakistan Limited Porta cabin office 2,640 -

Contributions to staff retirement benefit fundsGratuity fund Contribution 2,300 898Pension fund Contribution 3,294 2,087Provident fund Contribution 1,946 1,273

7,540 4,258CommissionIGI Insurance Limited Insurance commission - 3,949

Other IncomeIGI Insurance Limited Insurance claim - 179

Key management personnel-Salaries and other

short-term employees' benefits 10,244 9,079-Post retirement benefits 1,205 1,012

11,449 10,091



Nature oftransactions

Quarterended

March 31,2011

Rs ‘000

Quarterended

March 31,2010

Rs ‘000

Name and Particulars

10. TRANSACTIONS WITH RELATED PARTIES

Quarterended

March 31,2011

Rs ‘000

Quarterended

March 31,2010

Rs ‘000



11. CASH GENERATED FROM OPERATIONS

Profit before taxation 295,192 130,937

Adjustment for non cash charges and other items:Depreciation 96,509 87,640Provision written back - (174)Provision for retirement benefits 5,408 3,802Profit on bank balances (91) (110)Profit on disposal of fixed assets (400) (1,964)Provision for accumulated compensated absences 2,850 1,950Finance cost 28,778 50,966Working capital changes - note 11.1 (391,766) (31,821)

36,480 241,226

11.1 Working capital changes

(Increase) / decrease in current assets:

Stores and spares (31,659) (23,066)Stock-in-trade (285,414) 137,532Trade debts (109,745) (42,180)Advances, prepayments and other receivables (46,453) (28,293)

(473,271) 43,993Increase / (Decrease) in current liabilities:

Trade and other payables 81,505 (75,814)(391,766) (31,821)

March 31,2010

Rs ‘000



March 31,2011

Rs ‘000

Quarterended

March 31,2010

(Metric tonnes)

Quarterended

March 31,2011

(Metric tonnes)

Cash and bank balances 83,903 206,795Short term finances - note 4 (550,000) (620,293)

(466,097) (413,498)

13. PLANT CAPACITY AND ACTUAL PRODUCTION

Operational capacity available during the period 8,950 8,700Production 8,703 8,517

14. DATE OF AUTHORISATION FOR ISSUE

These financial statements were authorised for issue on April 26, 2011 by the boardof directors of the Company.

12. CASH AND CASH EQUIVALENTS



Registered Office4th Floor, The Forum, Suite No. 416-422G-20, Block No. 9, Clifton, Khayaban-e-Jami,Karachi-75600, Pakistan.Tel: 92 21-3587 4047-49, 3583 1618Fax: 92 21-3586 0251

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First Quarter Ended March 2011 - tripack.com.pk

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